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Shares of Dutch Bros Inc. fell sharply after hours on Wednesday after the coffee chain forecast full-year sales that were below expectations and said it currently had “no plans” to raise its prices this year.
The company — known for its less formal approach to service than standard coffee shops, with an emphasis on an array of flavoring options — said it expected 2023 sales of between $950 million and $1 billion. The midpoint of that forecast was below FactSet estimates for $981.1 million.
Management for Dutch Bros
BROS,
said it expected “low-single digits” same-store sales for the year. That compared with FactSet forecasts for 2%.
But as customers feel the pinch from higher prices — which helped boost sales elsewhere in the take-out world and pleased investors — executives said they would lay off on any further hikes this year.
“At this point we have no plans to take additional menu pricing in 2023,” they said. “We expect low-single digits growth from pricing to roll-over into 2023 from menu pricing taken in 2022.”
Shares slid 7% after hours on Wednesday.
Food prices have risen over the past year, helping juice grocery-store profits. Within restaurants, executives at Starbucks Corp.
SBUX,
have said that coffee was an “affordable luxury” that customers were willing to still pay more for. And other food company executives have said people were still willing to pay up.
For the fourth quarter, Dutch Bros’s results were mixed. The chain reported a net loss of $2.8 million, or a penny a share, compared with $8.2 million, or 3 cents a share, in the same quarter in 2021. Revenue increased 44.1% to $201.8 million, compared with $140.1 million in the prior-year quarter.
Adjusted for share-based compensation and other expenses, Dutch Bros earned 3 cents a share.
Analysts polled by FactSet expected adjusted earnings per share of 8 cents, on revenue of $196.4 million.
Joth Ricci, Dutch Bros’s chief executive officer, said that sales gains for 2022 were driven by 133 shop openings nationwide.
Shares of Dutch Bros have fallen 21.1% over the past 12 months. The S&P 500 index
SPX,
has slipped 7.3% over that period.
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