El Pollo LoCo (LOCO) Q3 2026 Earnings Report

The call was predominantly positive, supported by four consecutive quarters of positive comparable sales, 5% system-wide same-store sales growth, improving traffic, strong digital and loyalty engagement, menu innovation, an expanding development pipeline, and maintained full-year guidance. The main challenges were lower reported earnings and adjusted EBITDA, higher G&A and operating costs, commodity inflation, increased debt after quarter-end borrowing, and the need to balance value investments with margin discipline.

For full year 2026, El Pollo Loco expects system-wide comparable store sales growth of approximately 4.5%, G&A expenses between $52.5 million and $53.5 million, excluding onetime charges and including approximately $6.5 million in stock compensation expense, capital spending between $33 million and $35 million, the opening of at least 3 to 4 company-operated restaurants and 15 to 16 franchise-operated restaurants, adjusted EBITDA between $68 million and $70 million with the expectation it will finish near the middle of the range based on current trends, and an estimated effective income tax rate of approximately 29% to 29.5% before discrete items; it expects restaurant contribution margin between 18.25% and 18.5%, commodity inflation to be a little over 3%, and wage inflation of approximately 1%; it expects to open 18 to 20 new restaurants this year and 25 to 30 new restaurants in 2027.