El Pollo Loco: Fire-Grilled Chicken Chain Set to Report Q4 and Full Year 2024 Results

El Pollo Loco Holdings, Inc. (LOCO) is set to report its fourth quarter and full year 2024 financial results on Thursday, March 6, 2025. Investors and analysts will be closely watching the company's performance, particularly in light of the challenging operating environment and the company's strategic shift towards franchising. Here's what to expect from El Pollo Loco's upcoming earnings report.



El Pollo Loco's strategic shift towards franchising has had both positive and negative impacts on its financial performance and growth prospects. On the positive side, the company has seen an increase in franchise revenue, which grew by 10.5% to $11.3 million in the third quarter of 2024 compared to the same period in 2023. This increase was primarily due to a franchise comparable restaurant sales increase of 2.7%, three franchise-operated restaurant openings, and the sale of 19 company-operated restaurants to existing franchisees. Additionally, the company has made progress in reducing the cost of its prototype to stimulate future unit growth.

However, the shift towards franchising has also led to a decrease in company-operated restaurant revenue, which fell to $101.2 million in the third quarter of 2024 from $102.7 million in the same period in 2023. This decrease was mainly due to the sale of 19 company-operated restaurants to franchisees, which resulted in a $5.3 million decrease in revenue. While this decrease was partially offset by an increase in company-operated comparable restaurant revenue of $2.7 million and additional sales from restaurants opened during or after the third quarter of 2023, the overall impact on company-operated revenue was negative.

In terms of growth prospects, the expansion of franchise operations could improve long-term profitability for El Pollo Loco. However, the near-term impact on revenue growth may be limited due to the decrease in company-operated restaurant revenue. The company's focus on reducing prototype costs for future unit growth shows strategic planning for expansion, though current new restaurant openings remain modest with only 5-6 planned units.



El Pollo Loco's focus on reducing prototype costs for future unit growth has been a strategic move to stimulate expansion and improve long-term profitability. The company has been working on reducing the cost of its prototype to make new restaurant openings more affordable and feasible. This focus on cost reduction is part of the company's broader strategy to become the national fire-grilled chicken brand and ignite further growth in 2025 and beyond. The expected outcomes of this focus on reducing prototype costs include increased affordability for new restaurant openings, improved long-term profitability, faster expansion, and enhanced competitiveness in the restaurant industry.

In conclusion, El Pollo Loco's upcoming earnings report will provide valuable insights into the company's financial performance and growth prospects. Investors and analysts will be closely watching the company's results, particularly in light of the challenging operating environment and the company's strategic shift towards franchising. The company's focus on reducing prototype costs for future unit growth is expected to lead to increased affordability for new restaurant openings, improved long-term profitability, faster expansion, and enhanced competitiveness in the restaurant industry. As El Pollo Loco continues to navigate the competitive restaurant landscape, its strategic initiatives and financial performance will be crucial factors in determining its long-term success.