Comp sales at the Sonic drive-in chain rose 4.9 percent year over year in the fourth quarter, rising on increases in customer traffic and check averages across all dayparts, executives noted on an earnings call Monday.
The chain’s five-daypart strategy has been a strong growth driver, CEO Cliff Hudson said, adding that breakfast is of particular interest as a vehicle for future gains.
“In the coming months, you will see more in different breakfast offerings than we’ve had historically or had previously,” he said.
Despite breakfast’s growing role at the chain, which serves its full menu all day, he implied that McDonald’s debut of all-day breakfast won’t be a major threat to sales.
“What's important to (Sonic customers) is to be able to have choices and flexibility,” CFO Claudia San Pedro added, noting that a “bigger factor” for the chain’s customers is being able to order a cheeseburger at breakfast, rather than the ability to order breakfast anytime.
Execs did note that the industry is becoming more competitive, adding that one unnamed competitor—not McDonald’s—had begun to “pick up their game” sales-wise.
“A major competitor is getting their act back together,” Hudson said. “I don’t know how—whether they’ll sustain it and these other industry segments will be more competitive I’m sure.”
Revenues at the 3,500-unit chain rose 6.6 percent year over year, to $175.3 million.