Arcos Dorados (ARCO) Q4 2024 earnings summary

Executive summary

• Achieved record revenues of $4.5B and adjusted EBITDA of $500M in 2024, with an all-time high EBITDA margin of 11.2% despite challenging macroeconomic conditions and currency depreciations.

• Q4 2024 revenue reached $1.1B, adjusted EBITDA was $147.4M (12.9% margin), and net income was $58.4M ($0.28/share).

• Systemwide comparable sales grew 21.5% in Q4 and 32.8% for the year, outpacing inflation in all divisions, with four consecutive years of guest volume growth.

• Digital, Delivery, Drive-through, and Development (Four D's) strategy drove sales and operational efficiencies, with digital sales up 18% year-over-year and contributing 57–58% of total sales.

• Loyalty program members surged to 15.8M at year-end, up 12.6M from prior year, with expansion to Argentina and Colombia.

Financial highlights

• Adjusted EBITDA margin was 12.9% in Q4 (up 160 bps) and 11.2% for the year (up 30 bps), both record highs.

• Digital sales grew 18% in USD, with Mobile App sales up 25% and delivery sales up 17%.

• Off-premise sales (delivery and drive-through) accounted for about 44% of total sales.

• Food and paper costs were flat or lower as a percentage of sales in all divisions; G&A expenses declined year-over-year.

• 85 new restaurants opened in 2024, with 67% EOTF penetration and over 150 modernizations.

Outlook and guidance

• 2025 guidance includes 90–100 new restaurant openings and $300M–$350M in capital expenditures.

• Comparable sales growth anticipated to be at or above inflation for 2025 in most markets, with Q1 expected to be the low point due to tough comparables and currency weakness.

• Board declared a $0.24/share cash dividend for 2025, payable in four installments.