Slide 1: Third Quarter 2019 Supplemental Earnings Slides
THIRD QUARTER 2019 SUPPLEMENTAL EARNINGS SLIDES NOVEMBER 4, 2019 SHAKE = SHACK =, on ZA es etairie, Louisian
Slide 2: Cautionary note on forward-looking statements
Cautionary note on forward-looking statements This presentation contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995 ("PSLRA"), which are subject to known and unknown risks, uncertainties and other important factors that may cause actual res
Slide 3: Q3 2019 financial highlights
Q3 2019 financial highlights +2.0% +32% YoY +35% YoY Growth in Total Revenue Shack System-wide Sales2 Same-Shack $157.8M $239.1M Sales1 $4.2M $23.3M 17 $35.1M Average Adjusted New Domestic Shack-Level Unit Volume3 EBITDA4 Company-Operated Operating Profit4 +9% YoY and Licensed Shacks +17% YoY opened
Slide 4: Business highlights
Business highlights On track to exceed original targets of Increased development focus on filling in Grubhub now fully integrated directly at least 200 domestic company- existing markets, build deeper brand into our point of sale, expect some operated and 120 licensed Shacks awareness and extend abi
Slide 5: Domestic development on track to exceed 2020 targets
Domestic development on track to exceed 2020 targets • Opened 11 domestic company-operated Shacks in Q3, on track Domestic company-operated Shacks to open 38 to 40 Shacks for the full year 2019 (At Fiscal Year End) • Plan to open between 40 and 42 new Shacks in 2020, across a strategic mix of urban,
Slide 6: Record year for licensed business with key new market entries
Record year for licensed business with key new market entries • New markets entered in 2019: Mainland China, Mexico, the Licensed Shacks Philippines, and Singapore (At Fiscal Year End) • 6 licensed Shacks opened in Q3, including Mexico City, third Shack in Osaka, Japan and our first in Busan, Korea
Slide 7: Guidance
Guidance These forward-looking projections are subject to known and unknown risks, uncertainties and other important factors that may cause actual results to be materially different. Factors that might cause such differences include, but are not limited to, those discussed in Part I, Item 1A of the
Slide 8: Appendix Including GAAP & Non-GAAP Measures
Appendix Including GAAP & Non-GAAP Measures 8
Slide 9: Impact of new lease accounting standard
Impact of new lease accounting standard Balance Sheet changes Balance Sheet impact from the adoption of the new Right-of-use asset & lease liabilities lease accounting standard • Net increase to total assets of $218 million Landlord funded assets & deemed landlord financing liabilities • Net increas
Slide 10: Definitions
Definitions “Adjusted EBITDA,” a non-GAAP measure, is defined as EBITDA (as defined above), excluding equity-based compensation expense, deferred lease costs, losses on the disposal of property and equipment, amortization of cloud-based software implementation assets, as well as certain non-recurrin
Slide 11: Income statement
Income statement Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2019 September 26, 2018 September 25, 2019 September 26, 2018 Shack sales $ 152,366 96.6% $ 115,882 96.9% $ 428,811 96.8% $ 324,869 97.0% Licensing revenue 5,396 3.4% 3,765 3.1% 14,273 3.2% 10,176 3.0% TOTAL REVENUE 157,762
Slide 12: Shack-level operating profit definitions
Shack-level operating profit definitions Shack-Level Operating Profit Shack-level operating profit is defined as Shack sales less Shack-level operating expenses, including food and paper costs, labor and related expenses, other operating expenses and occupancy and related expenses. How This Measure
Slide 13: Shack-level operating profit
Shack-level operating profit Thirteen Weeks Ended Thirty-Nine Weeks Ended (dollar amount in thousands) September 25, 2019 September 26, 2018 September 25, 2019 September 26, 2018 Operating income $ 8,164 $ 9,343 $ 25,197 $ 28,875 Less: Licensing revenue 5,396 3,765 14,273 10,176 Add: General and adm
Slide 14: Adjusted EBITDA definitions
Adjusted EBITDA definitions EBITDA and Adjusted EBITDA EBITDA is defined as net income before interest expense (net of interest income), income tax expense and depreciation and amortization expense. Adjusted EBITDA is defined as EBITDA (as defined above) excluding equity-based compensation expense,
Slide 15: Adjusted EBITDA
Adjusted EBITDA Thirteen Weeks Ended Thirty-Nine Weeks Ended (dollar amounts in thousands) September 25, 2019 September 26, 2018 September 25, 2019 September 26, 2018 Net income $ 11,423 $ 6,946 $ 26,201 $ 22,496 Depreciation expense 10,474 7,439 29,239 20,905 Interest expense, net 133 591 302 1,762
Slide 16: Adjusted pro forma effective tax rate
Adjusted pro forma effective tax rate Thirteen Weeks Ended Thirteen Weeks Ended Thirteen Weeks Ended Thirty-Nine Weeks Ended March 27, 2019 June 26, 2019 September 25, 2019 September 25, 2019 Income Tax Income Before Income Tax Income Before Income Tax Income Before Effective Tax Income Tax Income B
Slide 17: Adjusted pro forma effective tax rate
Adjusted pro forma effective tax rate Thirteen Weeks Ended Thirteen Weeks Ended Thirteen Weeks Ended Thirteen Weeks Ended Fiscal Year Ended March 28, 2018 June 27, 2018 September 26, 2018 December 26, 2018 December 26, 2018 Income Tax Income Before Effective Tax Income Tax Income Before Effective Ta
Slide 18: Investor Contact / Media Contact
Investor Contact: Mei Kuo 646-747-0540 mkuo@shakeshack.com Melissa Calandruccio, ICR Michelle Michalski, ICR (844) Shack-04 (844-742-2504) investor@shakeshack.com Media Contact: Kristyn Clark, Shake Shack 646-747-8776 kclark@shakeshack.com 18