Del Taco Restaurants announced the third quarter 2015 financial results. Total revenue was $98.6 million, an increase of 6.7% compared to $92.4 million in the fiscal third quarter of 2014.
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The growth in revenue was driven by a 6.7% increase in company restaurant sales and a 6.8% increase in franchise revenue.
Comparable restaurant sales increased 5.6% system-wide for the fiscal quarter ended September 8, 2015 compared to the 5.6% gain in the prior year fiscal third quarter, for a two-year growth rate of 11.2%. The Del Taco system has now generated comparable restaurant sales growth for eight consecutive quarters.
Company-owned comparable restaurant sales increased 5.4% and included a 0.6% gain in traffic, marking the thirteenth consecutive quarter of comparable restaurant sales growth. Average check growth contributed meaningfully to the comparable restaurant sales increase as guests responded favorably to the introduction of new premium products that embed Del Taco’s QSR+ positioning. Franchise comparable restaurant sales increased 5.8%.
Restaurant contribution, a non-GAAP financial measure, increased 15.6% year-over-year to $18.7 million. As a percentage of company restaurant sales, restaurant contribution increased approximately 150 basis points year-over-year to 19.7%. The increase was driven by a 100 basis point improvement in labor and related expenses, a 40 basis point improvement in occupancy and other operating expenses, and a 10 basis point improvement in food and paper costs.
Adjusted EBITDA, a non-GAAP financial measure, was $15.3 million, an increase of 9.6% from $13.9 million in the previous year’s fiscal third quarter. A reconciliation between adjusted EBITDA and the nearest GAAP financial measure is included in the accompanying financial data.
Income from operations increased 17.0% to $10.2 million compared to $8.7 million in the prior year fiscal third quarter.
Net income was $2.4 million during the two weeks ended June 30, 2015 (predecessor) and net loss was $2.2 million during the ten weeks ended September 8, 2015 (successor) and included $12.0 million of transaction-related costs, compared to net income of $0.9 million in the fiscal third quarter of 2014 (predecessor). ■