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Noodles & Co.: Bomb cyclone forced 1-day closure of 60 Colo. stores

The chain, which reported 4% comps growth in Q4 but fell short of expectations, is increasingly shifting to an off-premise focus.
Photograph: Shutterstock

This week’s powerful “bomb cyclone” storm that hit much of the country forced Noodles & Co. to close all 60 of its Colorado units for a day, the company revealed in a call with analysts Thursday.

It’s too soon to determine the impact of that shutdown on the fast-casual chain’s 2019 sales, but shares of the company’s stock were down more than 15% midday Friday on weaker-than-forecasted earnings news for the quarter ended Jan. 1.

The Broomfield, Colo.-based company reported same-store sales growth of 4% for the quarter as well as revenue growth of 0.4%, to $113.2 million.

Much of the chain’s future growth hinges on two major initiatives, executives said: expansion of the company’s zucchini noodles menu offerings and an increased focus on off-premise innovation.

The chain plans to expand its better-for-you-platform in May with gluten-free items as well as enhanced marketing around the zucchini noodle, or zoodle, options.

But perhaps the chain’s biggest initiatives for the coming months center on boosting efficiency in off-premise operations. Off-premise could eventually account for 60% to 65% of the chain’s sales, if not more, executives said.

Off-premise grew to 54% of sales in the fourth quarter, company officials said, a 400-basis point increase year over year. Online ordering grew to 16% of sales during the quarter, representing a 450 basis-point jump over the previous year.

“During 2019, we will begin testing improvements to eliminate friction for in-restaurant pickup of online orders,” Noodles & Co. CEO Dave Boennighausen said during the earnings call.

Pickup windows are being added in the remodeling process at select units, and 75% of new locations will include the windows.

“In the limited number of restaurants that currently have windows, we are seeing great adaption and appreciation from our guests to be able to pick up their order without having to leave the car,” Boennighausen said.

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