El Pollo Loco (LOCO) 27th Annual ICR Conference 2025 summary

Business performance and turnaround

• Achieved strong profitability and cash flow, focusing on margin improvement in year one of a three-year turnaround.

• Year two centers on modernizing the brand, driving innovation, and increasing sales and transactions.

• Franchise partners are eager to grow, contingent on improved unit economics and reduced build costs.

• New prototype introduced with a $1.8M target build cost and a smaller, more efficient footprint.

• Remodel program aims to refresh about half the system over the next two years, with expected mid-single-digit sales lifts.

Menu strategy, pricing, and innovation

• Value offerings like $5 Pollo Loco and Taco Tuesday have resonated, with a focus on value across the menu.

• Innovation and value are combined, with new products in the $7-$9 range planned for 2025.

• Menu pricing increased by 7.75% in 2024 to offset minimum wage hikes, with moderate increases planned for 2025.

• Five new marketing windows in 2025 will feature entirely new products, including Mango Habanero Chicken and Fresca Wraps.

• New agency partnership to support brand repositioning, with new campaigns expected mid-2025.

Operational improvements and technology

• Kiosk rollout to be completed in company restaurants by Q1 2025, with half the system adopting kiosks this year.

• Kiosks expected to drive productivity, upselling, and order accuracy, with labor savings realized over time.

• Standardization and retraining initiatives have reduced turnover and improved operational consistency.

• Focus on total cost to serve, with supply chain optimization and productivity investments like salsa machines and holding cabinets.

• Targeting 18%-20% margins over time, with 2%-3% annual growth needed to support these goals.