Short answer
Wendy's Co (WEN) filed its fiscal 2018 10-K annual report with the SEC on Feb 27, 2019. It reported revenue of $1.6B (+30.0% year over year) and net income of $460M.
- Top risk flagged: Cybersecurity litigation: 2016 franchisee malware incident triggered consolidated customer and financial-institution class actions
FY2018 key financial metrics · XBRL
- Revenue
- $1.6B
- +30.0% YoY
- Net income
- $460M
- +137.1% YoY
- Operating margin
- 15.7%
- −1.8 pp YoY
- EPS (diluted)
- $1.88
- +144.2% YoY
- ROE
- 71.0%
- +37.1 pp YoY
- Operating cash flow
- $224M
- −10.9% YoY
Source: XBRL data from the Wendy's Co (WEN) FY2018 10-K on SEC EDGAR. USD.
Wendy's Co FY2018 10-K analysis
AI summary of each section, grounded in the filing text
Business Overview
- Franchise-led quick-service hamburger system, with royalties, advertising contributions, rents and franchise fees as core revenue sources
- August 2018 development incentive program, offering incremental royalty and advertising reductions for qualifying franchisee expansion
- Delivery available at more than 60% of North American restaurants, highlighting intensified digital and convenience positioning
- System expanded to 6,711 restaurants from 6,634, while Company-operated locations remained approximately 5% of the network
- $450.0 million sale of Wendy’s remaining 12.3% Inspire Brands stake, ending indirect ownership of Arby’s and Buffalo Wild Wings brands
Management Discussion & Analysis
- Revenue $1,589.9M, up $366.5M YoY, including $326.0M advertising funds revenue from new accounting guidance
- Operating profit $249.9M, operating margin 15.7% vs 17.6%; restaurant margin 15.8% vs 16.8%
- Best performer: international franchised systemwide sales $518.9M, up 13.0% constant currency; weakest: international franchised AUV $1,082.7K vs $1,104.5K
- Operating cash flow $224.2M; capex $69.9M; buybacks $270.2M; dividends paid $80.5M
- 2019 outlook: capex $75.0M to $80.0M, dividends up to $92.1M, buybacks up to $225.0M; risks include higher labor and commodity costs
Risk Factors
- Cybersecurity litigation: 2016 franchisee malware incident triggered consolidated customer and financial-institution class actions
- Supply concentration: four processors across five facilities supplied all U.S. beef as of December 30, 2018
- Digital disruption: competitors with greater resources could outpace Wendy’s digital ordering and delivery capabilities
- Franchise dependence: approximately 95% of restaurants operated by franchisees, affecting royalty revenue and brand execution
- Leverage: approximately $2.8 billion debt outstanding as of December 30, 2018, limiting financial flexibility
Generated from the filing text; verify against the original. How to read a 10-K
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