The Wendy’s Company: Initiation Of Coverage – Expansion Of Footprint In UK & US

This is our first report on Wendy’s Company. In Q4, Wendy’s global systemwide sales grew over 3%, supported by global same-restaurant sales growth and the benefit of global net unit growth. U.S. company-operated restaurant sales grew due to higher average check figures driven by cumulative pricing of around 4.5%. The U.S. company-operated restaurant margin contracted due to customer count declines, labor inflation, and mid-single-digit commodity inflation. This was partially offset by higher franchise royalty revenue, a decrease in the company’s incremental investment in breakfast advertising, and lower G&A expense.