FOR THE FULL COMMENTARY AND COMPANY ANALYSIS, BE ON THE LOOKOUT FOR OUR AUGUST RESTAURANT INDUSTRY WORKBOOK. INVITE GOING OUT SOON...
Industry Same-Store Sales were down -0.3% YoY in August, a 190bps sequential increase, from being down -2.3% YoY in July. Despite the month-over-month jump, this is the 3rd consecutive month of negative Industry SSS. Fine Dining (+1.5%), Upscale Casual (+1.2%), and Fast Casual (+0.6%) all posted positive growth, while QSR (-0.7%), Casual Dining (-0.7%), and Family Dining (-0.9%) all remained negative, year-over-year. We saw a significant bounce back, as many regions made up ground on poor growth in July. All segments saw positive revisions in both Sales and Traffic MoM, excluding Quick-Service, which saw a 20bps drop in Same-Store Sales.
Industry Traffic was down 3.6% YoY in August, marking the 18th consecutive month of negative Traffic on a year-over-year basis. Despite this, there was a significant deceleration in this decline, as sequentially Traffic rose 100bps. Almost all segments posted negative Traffic, with Fine Dining being the only outlier, logging a mere 0.1% growth YoY. Family Dining (-4.5%) had the largest decline in Traffic on a YoY basis, with QSR (-4.0%) and Casual Dining (-3.9%) not far behind. Sequentially, all segments captured positive Traffic growth except for QSR, which posted a 50bps decline.
Industry-wide, California was one of two regions to post positive Same-Store Sales (+1.6%) YoY, up 220bps MoM. New England was the only other region that had positive SSS in August. Florida was the worst region for Same-Store Sales in the month, down 2.0% YoY, but up 140bps sequentially. Florida also saw Traffic down 5.3% YoY. All regions, at the industry level, displayed negative Traffic growth, YoY, however all regions, excluding New York/New Jersey and New England, improved sequentially.
Year-over-year Same-Store Sales declined -0.7% within Quick-Service. The segment was pulled downward by declines in the Western region (-2.0%), Florida (-2.3%), and the Mountain Plains (-2.5%) on an annual basis. Out of the three, Florida and the Western region both experienced sequential declines in SSS. Texas, the Midwest, and Mid-Atlantic regions all recorded positive Same-Store Sales at 0.6%, 0.5%, and 0.1% respectively. For the 7th consecutive month, California posted the largest QSR Per-Ticket Average—up 8.2% YoY. However, this was a slight sequential decline by 10bps. As for Traffic, a slightly similar story to last month’s continued downswing. There were 0 Regions in QSR that had positive YoY Traffic in August – this was also reflected in July. California recorded the lowest QSR Traffic, down -7.9% YoY, also yielding insight to the heightened check within California QSR's. The New York/New Jersey region experienced the largest MoM deceleration in Traffic—a 200bps move downwards.
Fast Casual fared well in August, with 7/11 regions displaying positive SSS YoY growth. California led all regions, posting 3.8% SSS growth, YoY. This was a 2.3% sequential increase from July. California Fast Casual's raised Ticket by 3.9% YoY, while also displaying positive Traffic at 0.6% YoY. Heading due east, NY/NJ experienced the largest decline, a -8.0% drop in Same-Store Sales, YoY. NY/NJ was up 370bps sequentially, from a heinous July, this was the largest MoM increase out of any region in QSR. The Empire State/Garden State combo takes the crown this with largest decline in traffic as well. The region experienced a 9.1% decline in Traffic YoY. This was deceleration of 240bps from a terrible July. While NY/NJ as a region have displayed prolonged dips in both Sales and Traffic – both declines are decelerating against July numbers.
Casual Dining was one of the worst segments in July; it was hard to get much worse. All regions saw significant sequential improvements in both Sales and Traffic. Sequential Sales across the board improved an average of 3.7% and Sequential Traffic, an average of 3.3%. California posted impressive Same-Store Sales figures, up almost 3% YoY. Conversely, Florida was the worst region by almost a full percent and was down 3.0% YoY. Staying in state, California Traffic improved 430bps in August to 0.0% YoY. Florida fared much worse, experiencing a 6.2% YoY drop in Traffic, although up from -8.4% YoY in July.
