The following is a summary of the Arcos Dorados Holdings Inc. (ARCO) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Arcos Dorados reported a rise in total revenue by 9.1% in Q1 2024, indicating a robust performance.

• The revenue rise was powered by system-wide comparable sales which increased above inflation in nearly all markets.

• The company's digital channel sales contributed significantly as they grew by 30% in U.S. dollars, constituting 55% of system-wide sales.

• The Q1 adjusted EBITDA growth went hand in hand with revenue growth, demonstrating a resilient business model and cost structure.

• The EBITDA for the first quarter experienced a nearly 27% growth from $59.5 million in Q1 2023 to $75.4 million in Q1 2024.

• Gross margin improvement was witnessed in multiple areas, primarily in Food, Paper and G&A.

Business Progress:

• Arcos Dorados continued its focus on the 3D strategy (Digital, Delivery Drive-thru), with digital channels contributing to the majority of system-wide sales.

• They inked a regional sponsorship agreement with Formula One to enhance their brand presence across Latin America.

• Mobile app, delivery, and self-order kiosks contributed enormously to sales growth, making up 55% of company-wide sales.

• The company witnessed an acceleration in restaurant openings with 22 units added during the first quarter.

• The Arcos Dorados Loyalty Program has seen a significant gain in registered members, going from 3.2 million at the end of 2023 to over 8 million by April 2024.

• Delivery services have outperformed expectations, constituting approximately 20% of system-wide sales in Brazil while growing by 27% in the US.

• The company plans to spur further growth through operational execution, innovations in digital capabilities and targeted marketing initiatives.

• The CapEx expansion has accelerated with the opening of 22 new restaurants in the first quarter compared to 8 in the previous year.

More details: Arcos Dorados IR

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