Customers arrive at a Cava restaurant in New York City on June 22, 2023.<\/p>\n
Brendan Mcdermid | Reuters<\/p>\n
Cava<\/a> on Tuesday lowered its full-year forecast for same-store sales growth after a disappointing second quarter.<\/p>\n For the full year, Cava now anticipates same-store sales growth of 4% to 6%, down from its prior range of 6% to 8%.<\/p>\n Shares of the company plunged more than 20% in extended trading. The stock has fallen 40% this year, including the after-hours move.<\/p>\n Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:<\/p>\n The restaurant company reported second-quarter net income of $18.4 million, or 16 cents per share, down from $19.7 million, or 17 cents per share, a year earlier.<\/p>\n Net restaurant sales\u00a0<\/strong>climbed\u00a020% to $278.2 million, largely thanks to new restaurant openings.<\/p>\n The chain’s same-store sales, a metric that\u00a0only tracks the performance of restaurants\u00a0that have been\u00a0open at least a year, rose 2.1% during the quarter. While Cava managed to buck the industry trend of same-store sales declines, Wall Street was projecting growth of 6.1%, according to StreetAccount estimates.<\/p>\n Cava said its quarterly traffic was “roughly flat.” A year earlier, the company’s same-store sales climbed<\/a> 14.4%, fueled by nearly double-digit traffic growth. At the time, Cava CEO and co-founder Brett Schulman credited the introduction of its grilled steak option as one reason customers kept coming to restaurants during the quarter.<\/p>\n CFO Tricia Tolivar told CNBC on Tuesday that the second quarter started off with strong same-store sales growth, which led the company to reiterate its prior outlook when it reported its first-quarter results<\/a>. However, she said, once the chain celebrated the one-year launch of grilled steak, it saw that growth slow.<\/p>\n Rival fast-casual chains have also struggled this quarter with slumping sales. Chipotle Mexican Grill<\/a> reported same-store sales<\/a> declines of 4%, while salad chain Sweetgreen<\/a> saw its stock plummet<\/a> after the company cut its outlook for the second straight quarter.<\/p>\n Aside from lowering its same-store sales forecast, Cava reiterated other key financial projections for the full year. The company still anticipates adjusted earnings before interest, taxes, depreciation and amortization of $152 million to $159 million. Cava also maintained its forecast for restaurant-level profit margins of 24.8% to 25.2%.<\/p>\n\n