Arcos Dorados: Reports Strong Q1-2024 Financial Results

Montevideo / UY. (arc) Arcos Dorados Holdings Inc., Latin America’s largest restaurant chain and the world’s largest independent McDonald’s franchisee, reported unaudited results for the three months ended March 31, 2024. First quarter 2024 highlights:

Chief Executive’s Commentary

CEO Marcelo Rabach: «The strength of these results demonstrate how far we have come as a company over the last decade. The Arcos Dorados business model delivered solid US dollar growth to start 2024, despite a challenging economic environment in one of our main markets. Importantly, by operating responsibly and managing the business with a long-term mindset, we built our strongest ever Brand reputation among Latin America’s quick service restaurant (QSR) customers.

«Over the last ten years we diversified our business to reduce our exposure to any single country. While Brazil remains our biggest market, both NOLAD and SLAD now contribute significantly to sales and Ebitda. NOLAD generates results in hard or very stable currencies while high growth potential markets in SLAD, such as Chile, Colombia and Uruguay, have also increased their contributions to consolidated results.

«The business model and the Three-D’s strategy (Digital, Delivery and Drive-thru) are working well together. We are focused on generating sustainable profitability growth over the long term. Our balanced approach to managing pricing, product mix and guest volumes is driving above-inflation comparable sales growth throughout our operations. Guest volumes are key to driving sustainable sales growth, and the McDonald’s Brand captures the highest volume per restaurant in our region.

«We see significant growth potential in Latin America and the Caribbean, and we are accelerating restaurant openings. We expect investments in the McDonald’s Brand to foster a virtuous cycle of growth in our communities and local economies. A more robust local economy should, in turn, support our long-term expansion plans while insulating the business from short-term volatility.

«Before closing, I want to express how saddened we are by the severe flooding in Brazil’s southernmost state: Rio Grande do Sul. Since this is an ongoing situation, it is too early to estimate the long-term human and environmental impacts of this natural disaster. In the meantime, we are actively supporting our people, suppliers, sub-franchisees and the communities we serve.

«Our efforts are focused on our employees and their families, including by providing basic necessities and by guaranteeing their job security during this difficult period. We have also begun distributing food within the communities we serve as well as to first responders. Our restaurant spaces have been made available to people seeking shelter, food or even just a place to charge their cell phones. Moving forward we will be working on several initiatives, in coordination with local governments and NGO’s to continue supporting our people and to aid in reconstruction.

«Finally, as we think about the future of Arcos Dorados, we believe all the levers we pulled to generate the strong results of the first quarter and, indeed, the last several years, will continue to drive results into the future. This is why we are confident we will be able to generate significant shareholder value for many more years to come.»