Comparable sales trends accelerated in the month of March at a positive 8.0% – DRH announced that its franchisor exercised its right of first refusal on planned acquisition
Diversified Restaurant Holdings, Inc. (Nasdaq: SAUC), one of the largest franchisees for Buffalo Wild Wings with 64 stores across five states, announced preliminary unaudited sales results for the first quarter ended March 31, 2019. DRH also announced that its franchisor, Buffalo Wild Wings, Inc., has exercised its right of first refusal to acquire the assets of nine BWW restaurants located in the Chicago market that were previously subject to its Asset Purchase Agreement dated February 22, 2019.
David G. Burke, President and CEO, stated, “The sales momentum that we enjoyed in the prior quarter has continued into 2019, with comparable sales up 4.2% for the first quarter. After layering on the latest brand enhancing initiatives launched in mid-March, which included a significant strategic media and marketing push around March Madness, we saw an additional measurable improvement in sales and traffic in March, with comparable sales up 8.0%.”
Mr. Burke added, “While we are disappointed that our franchisor has elected to take this transaction, we are excited about the positive momentum in our core business and believe that it is a reflection of the investments we have made in focusing on guest experience, loyalty attachment and strong execution of the delivery channel. We believe these investments, coupled with the brand enhancements being continuously rolled out by BWW, leave DRH well positioned to achieve strong long-term growth and earnings performance.”
Preliminary Q1 2019 Sales Results
Total revenue for the 2019 first quarter was $40.6 million, up from $39.5 million in the first quarter of 2018, despite one fewer restaurant. First quarter comparable sales were up 4.2%, the second consecutive positive quarter. While sales were negatively impacted by significant weather-related headwinds in the Company’s Midwest markets early in the year, these impacts were largely offset by the shift in timing of the Easter holiday from the first quarter of 2018 to the second quarter of 2019.
Preliminary results remain subject to the completion of normal quarter-end accounting procedures and are subject to change. The Company expects to release financial and operating results for its first quarter in early May.