Wendy's CEO expects to hit 10% digital sales goal in 2021, three years ahead of schedule
- The coronavirus pandemic sped up Wendy's digital sales goals by three years, CEO Todd Penegor told CNBC's Jim Cramer.
- "We didn't think we'd get to 10% until 2024, pre-pandemic," he said of the company's share of revenues that come from online ordering.
- "The breakfast business is doing quite well in the face of the pandemic," he added.
The coronavirus pandemic pushed American businesses to leverage the internet to reach consumers and the same can be said for Wendy's.
With the help of its loyalty program, the fast-food chain's digital arm is on its way to make up a larger share of the company's total sales well ahead of schedule, according to CEO Todd Penegor, who appeared on CNBC Wednesday.
The company now expects digital to make up 10% of sales in 2021.
"We didn't think we'd get to 10% until 2024, pre-pandemic," Penegor told Jim Cramer in a "Mad Money" interview. "What we're doing is driving a lot of active users into our app and people are engaging in the app. We're seeing a lot more mobile ordering and it's really because there's a benefit."
Wendy's also found success in the breakfast menu it launched last year. While fewer Americans commuted to the office during the pandemic, disrupting their odds of stopping at a restaurant for a morning breakfast sandwich or coffee, breakfast sales made up about 7% of total sales last year, the company said.
Penegor remained optimistic about being competitive with other restaurants in the morning rush. He expects the breakfast menu to account for 10% of sales by the end of 2022.
"The breakfast business is doing quite well in the face of the pandemic," he said. "For us to be able to deliver a 7% sales mix on our breakfast day part is quite remarkable and super encouraging. ... What we're seeing is strong repeat."
Earlier Wednesday, Wendy's reported fourth-quarter results that missed Wall Street's estimates on both the top and bottom lines. The company posted total revenues of $474.3 million for the quarter, up 11% from $427.2 the year prior, and net income of $38.7 million, up 46% from $26.5 million. According to FactSet, analysts were looking for revenues of about $476.6 million and net income of $39.9 million.
For the full year, Wendy's recorded $1.73 million in revenue, a 1.5% increase, and $117.8 million, down 14% from 2019.
U.S. same-restaurant sales increased 5.5% in the quarter and 2% for the full year.
Shares in Wendy's declined more than 5% Wednesday to a close of $20.12.
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