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: Noodles & Co. launches its first ghost kitchen in Chicago

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Noodles & Co. has launched its first test ghost kitchen in Chicago.

The noodles chain already has 20 locations in the Chicago area. The ghost kitchen will help the company with its off-premise business, including sales through digital channels.

Located in Humboldt Park, customers can order through the Noodles & Co.
NDLS,
+0.65%

app for pickup or delivery, or through third parties like DoorDash Inc.
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+3.83%

A ghost kitchen prepares food for delivery or to-go but doesn’t require the same physical space as a traditional restaurant.

See: Shake Shack may take time to recover from COVID, but Goldman Sachs is confident there’s growth ahead

“This is integral to our overall digital strategy as we work to develop faster service through our digital channels with lower overhead and labor costs, all without investing in a physical brick-and-mortar location,” said Stacey Pool, chief marketing officer at Noodles & Co. in a statement.

Noodles & Co. reported first-quarter earnings that missed expectations at the end of April.

Net income totaled $2 million, or 4 cents per share, after a loss of $5.8 million, or 13 cents per share, last year. Adjusted loss of 2 cents per share was deeper than the penny-per-share loss FactSet forecast. Revenue of $109.6 million was up from $100.3 million last year and ahead of the FactSet consensus for $110 million. Comparable restaurant sales grew 10.7% for the quarter. And digital sales were up 110%.

The company aims for 7% annual system-wide unit growth in 2022 and at least 10% shortly after, according to an earnings statement from Dave Boennighausen, chief executive of the company.

Read: Noodles & Co. CEO says there’s an ‘opportunity for growth’ as pre-COVID trends accelerate

Noodles & Co. also recently added a new stuffed pasta tortelloni dishes to the menu nationwide.

Ghost kitchens have gotten popular during COVID-19 as digital business at restaurants has accelerated.

Kroger Co.
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+0.11%

launched ghost kitchens with ClusterTruck in October 2020. Kroger is also an investor in ClusterTruck.

And Chili’s parent Brinker International Inc.
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+2.95%

launched It’s Just Wings, which it says could be a $150 million brand in its first year.

Noodles & Co. shares have rallied 57.3% for the year to date while the S&P 500 index
SPX,
+0.28%

is up 11.8% for the period.

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