Buffalo Wild Wings Drop 9% On 'high' Chicken Wing Costs

Shares of Buffalo Wild Wings Inc. fell more than 9% late Wednesday after the restaurant chain blamed "high wing costs," higher operating expenses, and lower-than-expected same-store sales for its second-quarter earnings miss. The company said it earned $8.8 million, or 55 cents a share, in the quarter, compared with $23.7 million, or $1.27 a share, in the second quarter of 2016. Adjusted for one-time items, the company earned $11 million, or 66 cents a share, compared with $25 million, or $1.34 a share, a year ago. Revenue rose 2% to $500 million, from $490 million a year ago. Analysts polled by FactSet had expected adjusted earnings of $1.04 on sales of $513 million. Same-store sales decreased 1.2% at company-owned restaurants. The company "continued to work on stabilizing the business in the challenging restaurant environment," Chief Executive Sally Smith said in a statement. She added the chain will feature boneless wings on Tuesdays, a "value day" at company-owned restaurants, instead of traditional bone-in wings as costs "remain at historically high levels". The company also lowered its 2017 outlook. "We are optimistic about the transition to boneless wings which provides a more stable promotional platform for the future," Smith said. Buffalo Wild Wings predicted a "traditional wing inflation" of 8% to 10% this year. Shares of Buffalo Wild Wings ended the regular session down 0.9%.

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