The company’s revenue was $455.5 million in 2020, down from $479.4 million in 2019. Its stores’ average annual sales were down too. But experts say its expedience with the drive-through lines and robust digital ordering system will likely help it succeed as a public company, especially as consumers continue their pandemic-engrained habits of ordering food to go. Portillo’s made 80% of its revenue through drive-throughs and digital orders in fiscal 2020 and the first two quarters of 2021.
Experts say that Portillo’s ability to create buzz with consumers is one of the reasons why the restaurant does such high volumes of sales. It has an almost cult following. Portillo’s did not spare that color from potential investors, peppering tweets from customers throughout its Securities and Exchange Commission filing.
“I’m gonna baptize my first born child in Portillo’s melted cheese,” read one tweet.
Another said: “My healthiest and most stable relationship is with an Italian beef sandwich from Portillo’s.”
The filing also noted that fans “beg” Portillo’s to expand.
“Many of our fans beg us through social media to bring a Portillo’s restaurant to their city (and we have received similar pleas from mayors), which we believe is indicative of the passion of our guests and the demand for more Portillo’s locations across the country,” according to the filing. (Read the full filing below.)
The company listed the size of its planned initial public offering as $100 million, a placeholder that will change when terms of the share sale are set. It plans to list shares on the Nasdaq exchange under the symbol “PTLO,” according to a regulatory filing.
Portillo’s is planning new locations in Illinois, Michigan, Arizona and Florida, as part of its short-term plan to add seven new restaurants between November 2020 and the end of 2021. It has opened new restaurants at a compound annual growth rate of about 9.3% since 2015, and plans to up that to 10 percent.
Portillo’s joined a growing number of restaurant chains that announced plans to go public this summer after a dry patch of eating establishment debuts on the markets. The market is receptive, and restaurant chains are looking to capitalize.
As a newly minted public company, Portillo’s will undoubtedly face challenges. Investors will expect fast growth, a jump into new markets, and a return on their investment. Other restaurant chains have fallen victim to growing too quickly after their public offerings.
Dick Portillo opened his first hot dog stand in Villa Park 58 years ago. It now offers much more than hot dogs. In fact, hot dogs aren’t even the chain’s biggest seller, according to the filing.
No single food category accounted for more than 23% of sales in 2020, with Italian beef leading the charge and fries and sides coming in close behind at 16%. Hot dogs and burgers both made up 14% of sales, beverages and beer 11%, and salad at 9%. Desserts (including the famous chocolate cake shakes) comprised 5% of sales, with pasta, ribs and chicken (including Portillo’s answer to the chicken sandwich wars) at 4%.
Portillo sold the chain to private equity firm Berkshire Partners for $1 billion in 2014. Michael Osanloo is now the president and CEO. According to the filing, he made about $1.6 million in compensation in 2020.