The San Diego fast-food chain on Wednesday reported same-store sales rose 7.2 percent at company-owned Qdoba Mexican Grill restaurants, and 7.5 percent system-wide. It was the second consecutive quarter of sales growth in the 7 percent range for Qdoba outlets, which compete with fast-casual chains such as Chipotle and Panera. There is one Qdoba in San Diego, behind the security check in Terminal 2 of the San Diego International Airport.
Qdoba's continued progress in the third quarter was due in part to menu innovations and less discounting, said Jack in the Box CEO Leonard Comma in Thursday's earnings call. Fewer discounts meant average check size, which was $10.43 in 2013, continues to go up.
The number of transactions also grew 2.7 percent, twice as fast as they did in the second quarter, thanks to more repeat visits.
Meanwhile, double-digit growth in catering sales, "which benefited from Cinco de Mayo celebrations and graduation parties," Comma said, also helped drive the division forward.
The recent sales increases herald new expansion and rebranding efforts as the company gears up to change the look of the restaurants and add new flavors on the menu, along the lines of its 3-Cheese Queso and Mango Salsa, that will help make it stand out from the competition.
In 2013, the company shared plans to sell off most of its Jack restaurants to franchisees while increasing its ownership of Qdoba. That year, it announced plans to close 67 of the lowest-performing Qdoba stores but promised more openings of the Mexican grill outlets in the near future. In the meantime, it put remodels at its estimated 600 remaining stores on hold until it had finished repositioning the brand.
The repositioning is nearly finished, said Chief Financial Officer Jerry Rebel, and Jack in the Box plans to open about 60 new Qdoba stores in 2015, roughly half of them company restaurants that will open later in the year with a fresh new design. The company's long-term plan is to operate 2,000 Qdoba restaurants nationwide.