(Reuters) - Shake Shack Inc (N:SHAK) forecast slowing same-restaurant sales growth in 2015 and swung to a fourth quarter loss, sending the hamburger chain's shares up to 9 percent lower on disappointment over its first quarterly report as a public company.
New York City-based Shake Shack, which began as a hotdog cart in the city's Madison Square Park, reported same-restaurant sales rose 7.2 percent in the fourth quarter, beating the average analyst estimate of 4 percent, according to research firm Consensus Metrix.
But the company that gained a near cult following for its rich milkshakes, crinkle fries and hormone- and antibiotic-free burgers, said it expected 2015 same-restaurant sales growth to be in the low-single-digit percentage range. Sales at Shacks open at least two years grew 4.1 percent in the year ended Dec. 31.
"We don't believe that over the long term the same-shack sales growth we experienced in the fourth quarter is sustainable," Chief Executive Officer Randy Garutti said on a post-earnings conference call.
Shares of the company were down 5.1 percent at $44.50 in after-market trading on Wednesday. Up to Wednesday's close of $46.90, the stock had risen 123 percent from its IPO price of $21 on January 30.
The company's shares debuted on the New York Stock Exchange at more than twice their offered price, buoyed by growth-hungry investors hoping the burger chain would replicate the red-hot run of industry darling Chipotle Mexican Grill Inc (N:CMG).
But repeating Chipotle's success has proven elusive for most restaurant operators, and it could be even harder to do in the crowded and competitive high-quality burger segment.
"Expectations are too high," David Louton, a professor of corporate finance at Bryant University told Reuters.
The company swung to a loss of $1.4 million, or 5 cents per share, in the quarter ended Dec. 31, from a profit of $997,000, or 3 cents per share, a year earlier.
Shake Shack attributed the loss to a $1.1 million after-tax charge related to its IPO.
Revenue rose 51.5 percent to $34.8 million.
