NOODLES & Co Q4 FY2024 earnings call

• Q4 sales improved compared to Q3 and year to date, driven by traffic, new menu items, media, and promotions. Q1 2025 comp sales growth over 3% with positive traffic. - Key priorities: operations excellence, stimulating noodle desire via limited-time offers and menu transformation, and renewed third-party delivery strength. - Menu transformation phases completed, with nine new dishes to be introduced next week, including new mac and cheese lineup and reimagined recipes. - Enhanced training process with additional hands-on training before and after menu rollout. - New brand strategy 'We Know Noodles' with marketing phases: tease, launch, and sustain. - Announced Joe Cristina as President and COO.

In the fourth quarter, total revenue decreased 2% to $121.8 million. System-wide comparable restaurant sales increased 0.8%, with company-owned restaurants seeing a 0.5% increase and franchise restaurants a 1.9% increase. Company comp traffic decreased 0.1%, while average check increased 0.6%. Restaurant-level contribution margin was 11.2% in the fourth quarter of 2024, down from 14.7% in the same period of 2023.

• Full-year 2025 total revenue expected $503-$512M with mid-single-digit comp restaurant sales growth. - Restaurant contribution margin 12.5%-14.0% (includes 100 basis point food cost investment for March menu rollout). - G&A expenses $49-$52M. - Open 2 new company-owned restaurants, close 12-15 company-owned and 4 franchise restaurants. - Capital expenditures $11-$13M, anticipate debt reduction in back half of 2025.

Q: Wondering what areas you're kind of seeing the most movement in on the guest satisfaction scores and how that's informing upcoming decisions A: The main areas are overall satisfaction, taste of food, accuracy, and value, as these relate to traffic growth and are showing significant improvement Q: Any help on same-store sales guidance, how to get to mid-single digits for full year A: First quarter over 3%, second quarter has Easter shift impact, most benefit to mid-single-digit growth expected in Q3 and Q4 Q: Quantify comps in last three weeks, impact of weather, and margin impact from menu rollout A: Don't break out month-by-month, but 3%+ in Q1 is sustainable. Marketing investment increased for launch, food cost investment of 100 basis points is permanent quality investment