Today, European Wax Center, Inc. (NASDAQ: EWCZ), the largest and
fastest-growing franchisor and operator of out-of-home waxing
services in the United States, provides an update ahead of its
presentation at the 26th Annual ICR Conference.
David Willis, Chief Executive Officer of European Wax Center,
Inc., stated: “In 2023, we delivered another year of strong unit
growth with 100 net new center openings, 18 of which opened in the
fourth quarter. The continued commitment of our franchise partners
to growing the European Wax Center brand allows us to enter 2024
with a strong development pipeline and reinforces our confidence in
our underlying business model. Additionally, we are pleased with
our execution of driving guest reservations during the fourth
quarter. Our core guests, which include both Wax Pass and routine
guests, continue to choose European Wax Center for their personal
care needs, representing a recurring revenue stream for our
franchisees, and in turn, our business. We remain focused on
expanding our leadership position in out-of-home hair removal and
creating additional value for our franchisees and
shareholders.”
The Company reports preliminary fiscal 2023 results of:
- 100 net new center
openings, at high end of previous outlook of 98 to
100
Fiscal 2023 Outlook
The Company updates its previous fiscal 2023 outlook for the
following metrics:
|
Fiscal 2023 Outlook (Current) |
Fiscal 2023 Outlook (Previous) |
System-Wide Sales |
$952 million to $955 million |
$945 million to $955 million |
Total Revenue |
$218 million to $219 million |
$217 million to $219 million |
Same-Store Sales |
2.5% to 2.8% |
1.5% to 2.5% |
|
|
|
The Company reiterates its previous fiscal 2023 outlook for the
following metrics:
|
Fiscal 2023 Outlook (Current) |
|
Adjusted Net Income |
$20.5 million to $21.5 million |
|
Adjusted EBITDA |
$74.5 million to $76.0 million |
|
|
|
|
The Company also repurchased approximately 1.7 million shares
for $23.5 million during the fourth quarter of 2023 and has
cumulatively repurchased the full $40 million authorized under its
current share repurchase program.
The Company notes that its fiscal 2023 financial results are
subject to quarter and year-end closing procedures, including a
financial statement audit. The Company expects to publish its
audited financial results for the fiscal year ended January 6, 2024
in early March 2024.
Management is scheduled to participate in a fireside chat at the
ICR Conference 2024 today, Monday, January 8, 2024, at 9:00 a.m.
EST. The live audio webcast can be accessed at the Company’s
investor relations website, https://investors.waxcenter.com. A
replay of the broadcast will remain on the Company’s investor
relations website for one year.
About European Wax Center, Inc.
European Wax Center, Inc. (NASDAQ: EWCZ) is the largest and
fastest-growing franchisor and operator of out-of-home waxing
services in the United States. European Wax Center locations
perform more than 22 million services per year, providing guests
with an unparalleled, professional personal care experience
administered by highly trained wax specialists within the privacy
of clean, individual waxing suites. The Company continues to
revolutionize the waxing industry with its innovative Comfort Wax®
formulated with the highest quality ingredients to make waxing a
more efficient and relatively painless experience, along with its
collection of proprietary products to help enhance and extend
waxing results. By leading with its values – We Care About Each
Other, We Do the Right Thing, We Delight Our Guests, and We Have
Fun While Being Awesome – the Company is proud to be Certified™ by
Great Place to Work®. European Wax Center, Inc. was founded in 2004
and is headquartered in Plano, Texas. Its network, which now
includes more than 1,000 centers in 45 states, generated sales of
nearly $900 million in fiscal 2022. For more information, including
how to receive your first wax free, please visit:
https://waxcenter.com.
Forward-Looking Statements
This press release includes “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements in this press release include but
are not limited to European Wax Center, Inc.’s strategy, outlook
and growth prospects, its operational and financial outlook for
fiscal 2023, its long-term targets and algorithm and statements by
European Wax Center’s executives. Words including “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “intend,”
“may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,”
“should,” “will,” or “would,” or, in each case, the negative
thereof or other variations thereon or comparable terminology are
intended to identify forward-looking statements. In addition, any
statements or information that refer to expectations, beliefs,
plans, projections, objectives, performance or other
characterizations of future events or circumstances, including any
underlying assumptions, are forward-looking.
These forward-looking statements are based on current
expectations and beliefs. These statements are neither promises nor
guarantees, but involve known and unknown risks, uncertainties and
other important factors that may cause the Company’s actual
results, performance or achievements to be materially different
results, performance or achievements expressed or implied by the
forward-looking statements, including, but not limited to: the
operational and financial results of its franchisees; the ability
of its franchisees to enter new markets, select appropriate sites
for new centers or open new centers; the effectiveness of the
Company’s marketing and advertising programs and the active
participation of franchisees in enhancing the value of its brand;
the failure of its franchisees to participate in and comply with
its agreements, business model and policies; the Company’s and its
franchisees’ ability to attract and retain guests; the effect of
social media on the Company’s reputation; the Company’s ability to
compete with other industry participants and respond to market
trends and changes in consumer preferences; the effect of the
Company’s planned growth on its management, employees, information
systems and internal controls; the Company’s ability to retain of
effectively respond to a loss of key executives; a significant
failure, interruptions or security breach of the Company’s computer
systems or information technology; the Company and its franchisees’
ability to attract, train, and retain talented wax specialists and
managers; changes in the availability or cost of labor; the
Company’s ability to retain its franchisees and to maintain the
quality of existing franchisees; failure of the Company’s
franchisees to implement business development plans; the ability of
the Company’s limited key suppliers, including international
suppliers, and distribution centers to deliver its products;
changes in supply costs and decreases in the Company’s product
sourcing revenue; the Company’s ability to adequately protect its
intellectual property; the Company’s substantial indebtedness; the
impact of paying some of the Company’s pre-IPO owners for certain
tax benefits it may claim; changes in general economic and business
conditions; the Company’s and its franchisees’ ability to comply
with existing and future health, employment and other governmental
regulations; complaints or litigation that may adversely affect the
Company’s business and reputation; the seasonality of the Company’s
business resulting in fluctuations in its results of operations;
the impact of global crises, such as the COVID-19 pandemic on the
Company’s operations and financial performance; the impact of
inflation and rising interest rates on the Company’s business; the
Company’s access to sources of liquidity and capital to finance its
continued operations and growth strategy and the other important
factors discussed under the caption “Risk Factors” in the Company’s
Annual Report on Form 10-K for the year ended December 31, 2022
filed with the Securities and Exchange Commission (the “SEC”), as
such factors may be updated from time to time in its other filings
with the SEC, accessible on the SEC’s website at www.sec.gov and
Investors Relations section of the Company’s website at
www.waxcenter.com.
These and other important factors could cause actual results to
differ materially from those indicated by the forward-looking
statements made in this press release. Any forward-looking
statement that the Company makes in this press release speaks only
as of the date of such statement. Except as required by law, the
Company does not have any obligation to update or revise, or to
publicly announce any update or revision to, any of the
forward-looking statements, whether as a result of new information,
future events or otherwise.
Disclosure Regarding Non-GAAP Financial
Measures
In addition to the financial measures presented in this release
in accordance with U.S. Generally Accepted Accounting Principles
(“GAAP”), the Company has included certain non-GAAP financial
measures in this release, including Adjusted net income and
Adjusted EBITDA. Management believes these non-GAAP financial
measures are useful because they enable management, investors, and
others to assess the operating performance of the Company.
We define Adjusted net income (loss) as net income (loss)
adjusted for the impact of certain additional non-cash and other
items that we do not consider in our evaluation of ongoing
performance of our core operations. These items include exit costs
related to leases of abandoned space, IPO-related costs, non-cash
equity-based compensation expense, corporate headquarters office
relocation, debt extinguishment costs, non-cash gains and losses on
remeasurement of our tax receivable agreement liability,
transaction costs and other one-time expenses.
We define Adjusted EBITDA as net income (loss) before interest,
taxes, depreciation and amortization, adjusted for the impact of
certain additional non-cash and other items that we do not consider
in our evaluation of ongoing performance of our core operations.
These items include exit costs related to leases of abandoned
space, IPO-related costs, non-cash equity-based compensation
expense, corporate headquarters office relocation, non-cash gains
and losses on remeasurement of our tax receivable agreement
liability, transaction costs and other one-time expenses. Please
refer to the reconciliations of non-GAAP financial measures to
their GAAP equivalents located in our most recent earnings release
dated November 8, 2023.
This release includes forward-looking guidance for certain
non-GAAP financial measures, including Adjusted EBITDA and Adjusted
net income. These measures will differ from net income (loss),
determined in accordance with GAAP, in ways similar to those
described in our most recent earnings release dated November 8,
2023. We are not able to provide, without unreasonable effort,
guidance for net income (loss), determined in accordance with GAAP,
or a reconciliation of guidance for Adjusted EBITDA and Adjusted
net income (loss) to the most directly comparable GAAP measure
because the Company is not able to predict with reasonable
certainty the amount or nature of all items that will be included
in net income (loss).
Investor Contact European Wax Center,
Inc.Bethany JohnsIR@myewc.com469-270-6888
Edelman Smithfield for European Wax CenterEWCIR@edelman.com
Media Contact Creative Media Marketing
Carolanne Coviello Ewc@cmmpr.com212-979-8884 ext 209
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