Yahoo Finance Papa John's is all in on stuffed crust pizza — CEO shares why
Papa John's CEO Rob Lynch isn't thinking of his new "epic stuffed crust pizza" as the typical limited-time fast food offering, but rather a platform from which to innovate in 2021 and drive extra sales.
"We have been really happy with the launch of stuffed crust pizza. It has been something that our customers have been asking for for a number of years, and now we are able to deliver it in a unique way that only Papa John's can," Lynch told Yahoo Finance Live.
Added Lynch, "We have had positive comparable sales for the last five quarters. We have had double-digit growth the last three quarters. And stuffed crust is continuing to propel that growth both on transaction and check. So we are going to continue driving stuffed crust, making that we are creating awareness that Papa John's has stuffed crust. We are excited about what the future holds."
Papa John's debuted its stuffed crust pizza in late December, challenging the long-time leader in the space in Yum! Brands-owned Pizza Hut. After working out the kinks in making the more complicated pizza in restaurants, Papa John's has started to see the fruits of its labor.
Lynch told analysts on a late February earnings conference call that stuffed crust customers tend to order more frequently and have higher average tickets (checks).
After a sizzling 2020 for Papa John's as more people ordered food at home during the pandemic, a new platform in stuffed crust pizza will help the chain keep growth elevated this year as it cycles tough comparisons.
Papa John's saw global comparable store sales surge 12.6% in 2020. Operating profits rose 268% from a year ago to $90.2 million. Earnings per share rose to $1.40 from $0.03 a year earlier.
Shares of Papa John's are up 55% over the past year, compared to a 7% gain for rival Domino's Pizza. Yum! Brands shares have increased 23%. Papa John's shares have fallen some 20% in the past month, however, as analysts dinged the company last month for not providing 2021 guidance due to COVID-19 related uncertainties.
"We're excited for the success of the vaccine. We are excited that people are going to be able to return to normal. And we know we are a show me story. We know that we had a couple tough years. And we had an unbelievable year throughout the pandemic. We fundamentally believe that what we built is built to last," Lynch said of the company's outlook.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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