Papa John’s is getting sales growth on top of strong sales growth and that’s getting operators to build more units.
The Louisville, Ky.-based pizza chain said on Thursday that its same-store sales rose 5.2% in the second quarter in North America—even though consumers have been leaving their homes more frequently and dining at other types of restaurants.
On a two-year stacked basis, Papa John’s same-store sales are up 33%.
After generating record sales during the pandemic, CEO Rob Lynch told investors on Thursday, “We have successfully held onto those customers. We anticipate more growth in the back half of 2021.”
Lynch said sales are coming from its Epic Stuffed Crust pizzas, which has generated “significant increases in ticket and traffic” since its introduction in the first quarter. The chain’s Parmesan Crusted Papadias sandwich, priced at $1 more than the $6 typical Papadia, also drove sales.
The chain, which operates more than 5,500 global locations, said that it is getting more unit growth this year. It opened a record 123 net new locations in the first half of the year as sales growth prompts more openings and pandemic-related bottlenecks ease.
Much of that growth has been in international locations—though domestic operators are opening more locations, and the chain grew by 11 units in the quarter to more than 3,300 North America locations.
The success led the company to increase its projections for new unit growth this year. The company announced a 220-unit development deal in Latin America with its largest operator, Drake Food Service International.
Internationally, same-store sales rose 21.2% on top of 5.3% growth in the same period a year ago.
More than half of Papa John’s sales in the second quarter came from its Papa Rewards members, now numbering 20 million. The loyalty program has added 500,000 members per month since the start of the year.
Revenues in the company’s fiscal second quarter ended June 27 rose 11.8% to $515 million. The company recorded a loss of nearly $80 million, largely related to a repurchase of preferred shares from big investor Starboard Value.
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