Aug 7 (Reuters) - Hispanic consumers in Jack in the
Box's core markets "face uncertainty and have pulled
back their spending," with the issue having an outsized impact
on the U.S. fast-food chain's sales, its CEO said.
Same-store sales for Jack in the Box declined 7.1% in the third
quarter ended July 6. The company also reported a decline of
2.6% in same-store sales for another taco chain it owns, Del
Taco.
Jack in the Box CEO Lance Tucker, speaking on an earnings call
on Wednesday, separated the pullback of Hispanic consumers from
other trends, such as a drop in spending by lower-income
consumers that he said was "well in line with industry trends"
Tucker said the proportion of Hispanic consumers at Jack in the
Box, which has core markets in Texas, California and the U.S.
Southwest, is twice as high as some major competitors.
Tucker did not specify the "uncertainty" he believes Hispanic
consumers are facing.
U.S. Immigration and Customs Enforcement officers have been
intensifying efforts in recent months to deliver on Republican
President Donald Trump's promise of record-level deportations.
Rita Fernandez, director of immigration policy at UnidosUS,
which describes itself as the largest Latino civil rights group
in the country, said many migrants have been withdrawing from
public life.
"Jack in the Box is a favorite destination and dining
choice for many Hispanics," she said, but "a day laborer who is
undocumented maybe isn't going to take that lunch break at Jack
in the Box if he doesn't know if he'll encounter ICE on the
way."
Tucker said the pullback in spending from Hispanic consumers has
been "pretty consistent" since the beginning of the year.
Trump's second term began in January.
The timeline is consistent with what Wingstop ( WING ) CEO Michael
Skipworth said last week, when he said areas with a high
proportion of Hispanic and low-income consumers have had weaker
demand since the beginning of the year.