Burger chain Shake Shack posts bigger-than-expected quarterly loss

(Reuters) – Shake Shack Inc (SHAK.N) posted a bigger-than-expected quarterly loss on Thursday, as the burger chain temporarily closed some restaurants and limited working hours due to COVID-19 lockdowns and civil unrest that gripped several U.S. cities.

Shares of New York-based company were down 5% in extended trading.

Restaurants have been forced to bank heavily on sales from online orders and drive-thrus and also identify new ways to serve customers, as they battle constantly changing dynamics and consumer behaviors brought on by the health crisis.

Industry bellwether McDonald’s on Tuesday said that drive-thru accounted for nearly 90% of its quarterly sales, while urban-centric Shake Shack has only started the design process for its first ever drive-thru location, planned to open in 2021.

The restaurant chain said same-store sales fell about 49% in the quarter ended June 24, as traffic more than halved. Total quarterly revenue fell to $91.8 million from $152.7 million, below average analysts’ estimate of $93 million.

Digital sales accounted for three-fourths of the company’s sales.

Excluding one-time items, Shake Shack posted a loss of 45 cents per share, compared with market estimates of 37 cents, according to IBES data from Refinitiv.

It also said same-store sales decreased 39% between June 24 and July 22, with rural restaurants outperforming the urban ones.

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