Thursday June 20, 2019, 00:00:00
PZZA 2019 Franchise Disclosure Document Review for Papa John’s
Not too long ago, Papa John’s (PZZA; Buy) filed its Franchise Disclosure Document (FDD) for 2019. In this report, we cite some of the highlights from that document following our review of it, including our review of it in comparison to last year’s Franchise Disclosure Document. For example, we would note that the On-Line Transaction Fee for 2019 is “1.75% of Net Sales via Internet on-line ordering,” as compared to the 2018 FDD which shows that fee as “1.5% of Net Sales via Internet online ordering” at that time. Also, the 2019 FDD shows that — for company-owned restaurants only — food costs represented 29.7% of sales, while labor costs/taxes represented another 21.6% of sales. The average pre-tax cash flow for a companyowned restaurant in 2018 was $131,859, or 12.3% of sales. We maintain our Buy rating on PZZA and note the following:
