Shake Shack To Close Nine Company-Owned Shacks In California, Ohio, And Texas; Closure Plan Communicated On August 27 With Completion Expected By September 25; Reaffirms Fiscal Q3 And FY24 Guidance; Management Offered Positions In Neighboring Shacks, Hourly Team Members Eligible For Rehire; Expects Q3 Pretax Charges Between $28M - $30M
Portfolio Pulse from Benzinga Newsdesk
Shake Shack plans to close nine company-owned locations in California, Ohio, and Texas by September 25. Despite the closures, the company reaffirms its fiscal Q3 and FY24 guidance. Management is offered positions in nearby locations, and hourly team members are eligible for rehire. The company expects Q3 pretax charges between $28M and $30M.
August 27, 2024 | 8:22 pm
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Shake Shack is closing nine locations in California, Ohio, and Texas, with completion expected by September 25. The company reaffirms its fiscal Q3 and FY24 guidance despite these closures. Management is offered positions in nearby locations, and hourly team members are eligible for rehire. The company anticipates Q3 pretax charges between $28M and $30M.
The closure of nine locations could be seen as a negative operational move, but the reaffirmation of fiscal guidance suggests that the company is managing its financials well. The impact on the stock price is likely neutral as the market may have already priced in these closures, and the guidance reaffirmation provides stability.
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