First Watch Restaurant Group (FWRG) investor relations material

Executive summary

• Total revenues rose 17.3% year-over-year to $331.0 million in Q1 2026, with system-wide sales up 13.8% to $367.6 million and same-restaurant sales growth of 2.8%, while same-restaurant traffic declined 2.0%.

• Opened 16 new restaurants in Q1 2026, bringing the total to 648 locations across 32 states, with 572 company-owned and 76 franchise-owned units.

• Net loss widened to $2.7 million ($0.04 per diluted share) from $0.8 million ($0.01 per share) in Q1 2025.

• Rolled out a new core menu system-wide, driving higher check averages and positive customer response.

• Accelerated digital marketing now covers 75% of restaurants, yielding positive ROI and increased brand engagement.

Financial highlights

• Adjusted EBITDA increased 22.2% to $27.8 million, with margin up to 8.4% from 8.1% year-over-year.

• Restaurant-level operating profit margin improved to 18.5% from 16.5% in Q1 2025.

• Food and beverage expense declined to 22.6% of sales, aided by 4% carried pricing and 1.6% commodity deflation.

• Labor expenses improved to 33.7% of sales, a 90 basis point improvement year-over-year, despite 3.7% wage inflation.

• General and administrative expenses rose 32.2% to $39.9 million, reflecting higher compensation, a leadership conference, and marketing.

Outlook and guidance

• Fiscal 2026 guidance: same-restaurant sales growth of 1%–3%, total revenue growth of 12%–14%, and adjusted EBITDA of $133–$140 million.

• Expecting 59–63 net new system-wide restaurants in 2026, with 53–55 company-owned and 9–11 franchise-owned.

• Capital expenditures projected at $150–$160 million, focused on new units and remodels.

• Full-year commodity inflation expected at 1%–3%; labor cost inflation at 3%–5%.

• Guidance raised for adjusted EBITDA due to strong Q1 performance and completed acquisitions.