First Watch Restaurant Group (FWRG) 47th Annual Raymond James Institutional Investor Conference summary

Company overview and growth strategy

• Operates over 600 daytime-only restaurants focused on breakfast, brunch, and lunch, with a reputation for fresh, high-quality ingredients and no deep fryers or microwaves.

• Maintains low double-digit unit growth, entering five new markets in the past year and continuing to lead the daytime dining segment.

• New unit openings consistently outperform expectations, with 2025's class performing 19% above underwriting targets.

• Growth strategy includes expanding in both new and core markets, with a robust real estate and talent pipeline.

• Plans to reach operational efficiency in new markets by clustering four to five restaurants per area.

Menu, marketing, and guest experience initiatives

• Launched a new core menu for the first time in 10 years, following extensive testing, alongside five seasonal menus annually.

• Expanded digital marketing initiatives from one-third to 75% of the system in 2026, leveraging consumer and third-party data for targeted campaigns.

• Investments in guest experience include increased portion sizes and digital guest-facing tools to reduce friction.

• Operational technology upgrades aim to simplify processes for both customers and staff, enhancing service quality.

• Focus remains on consistency and high-quality execution rather than discount-driven promotions.

Financial outlook and pricing strategy

• 2026 guidance includes same-restaurant sales comps up 1%-3%, with no price increases taken in January and a mid-year review planned.

• Pricing philosophy is to cover permanent inflation, having taken about 15% less price than peers since 2019.

• Store margins expected to remain flat, with commodity inflation guided at 1%-3% and labor inflation at 3%-5%.

• Commodity basket sees deflation in eggs and avocados, but inflation in bacon and coffee, the latter due to premium sourcing.

• Focus on maintaining value through experience and quality rather than aggressive pricing.