facebook pixal

Pollo Tropical starts the year off with more customers and better profits

The fast-casual chicken restaurant chain said its traffic has improved so far this year, as did its profit margins.
Pollo Tropical sales
Pollo Tropical says it saw traffic and sales growth in January and February. / Photograph: Shutterstock.

Fiesta Restaurant Group, the parent company of Pollo Tropical, started 2023 with more customers and better profits.

Transactions are up so far this year, the company said on Thursday. That’s an improvement from December, when they were down 2.4%, according to the company’s fourth fiscal quarter earnings report. Transaction growth was especially strong in the company’s South Florida Markets.  

Same-store sales at the 169-unit chain rose 11% in the fourth quarter compared to the year prior and were up 10.2% in January.

“Our accelerating comp transaction momentum was the direct result of the actions we shared previously to improve staffing, expand our sales growth initiatives and continue our successful pairing of value item pricing with check-accretive limited-time offers,” said Dirk Montgomery, Fiesta Restaurant Group interim CEO, in a call to investors.

Montgomery said improved staffing helped drive sales. He said that hourly team staffing levels improved in the fourth quarter compared with the first half of 2022 and have continued to further improve in 2023. Hourly turnover rate was also down, he said.

Pricing also helped, Montgomery said. Fiesta is pairing lower price increases on high-value items to maintain a value-oriented perception from consumers.

“We are clearly seeing that our coordinated efforts to balance menu innovation, promotional activity and analytic-based pricing is helping to build revenue and win back traffic. In the fourth quarter, we saw a positive impact on check averages from the pricing action of 4% in September, while maintaining a higher value perception level compared to our peer group,” said Montgomery.

Fiesta’s restaurants have improved in profitability too. Restaurant-level operating profit margins increased to 16.2% of revenues compared with third-quarter 2022 margins of 14.1%

Montgomery said that this year, Fiesta is aiming for restaurant-level operating margins of 18%, which it plans to accomplish with the combination of transaction growth and pricing.

Montgomery was named interim CEO in December. Since then, he’s focused on improving operations and profit margins while driving traffic growth at the chain.

Pollo Tropical has also refreshed 32 of its restaurants, which have generated an average sales lift of 4%, the company said in its earnings report.

The company has improved training, focusing on speed and service. It has also worked to simplify the operating model and increase productivity during peak periods, among other things. “We feel extremely confident about our prospects and our ability to harvest the potential this brand clearly has,” Montgomery said.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.


Exclusive Content


Zume Pizza and the folly of trying to replicate Amazon

Tech Check: The demise of the former delivery startup shows the dangers of pushing a good idea too far.

Emerging Brands

Longtime Applebee's and Panera operator gives Jinya Ramen Bar a try

Doherty Enterprises has signed on to bring the Asian concept to the Greater New York City area.


At Subway, a very public auction draws to a close

The Bottom Line: The company has reportedly narrowed its list of buyers and the price tag is down. But the deal is taking a while to get over the finish line, and here’s why.


More from our partners