Wendy’s said Friday it plans restructuring __ and possible corporate layoffs __ in an effort to speed up decision-making and invest more in new restaurant development.
The news comes just a week after rival McDonald’s announced a similar corporate reorganization that also plans to speed up restaurant openings and improve efficiency. McDonald’s has announced that it will provide more details about the layoffs to employees by April 3. Wendy’s has not set a date.
Dublin, Ohio-based Wendy’s, the third-largest U.S. burger chain behind McDonald’s and Burger King, said Friday it expects its full-year revenue to grow 10.5% in 2022 to 2.1 billion dollars. That would be higher than Wall Street’s expectations. The company plans to release fourth-quarter and full-year earnings on March 1.
Wendy’s Chairman and CEO Todd Penegore said on a conference call with investors that the company is starting its restructuring from a position of strength, with 12 consecutive years of global same-store sales growth, or sales at restaurants open at least 15 months. U.S. business picked up in the fourth quarter with promotions such as mint-flavored Frosty and a $5 Biggie bag that combines a sandwich, chicken nuggets, fries and a drink.
But Penegor said Wendy’s needs to focus more on global store growth and digital sales. Wendy’s has nearly 6,000 restaurants in the United States and just over 1,000 in 31 foreign countries.
Penegor stressed that Wendy’s will limit its focus to traditional stores, not just options or other experimental designs. He also wants the company to continue its momentum in the fast-growing breakfast segment __ which it re-entered in 2020 __ and improve store operations.
“As you take some of the layers out of the organization and allow us to make decisions faster, it can drive focus, efficiency and productivity,” he said.
Shares of Wendy’s rose 6% to close at $23.08.
Wendy’s announced Friday that it has eliminated Kurt Kane, its U.S. president and chief commercial officer, who will be leaving the company. Leigh A. Burnside, the company’s chief accounting officer and senior vice president, also announced his departure.
The company also said its board authorized repurchasing up to $500 million in stock and doubled its quarterly dividend to 25 cents a share.