Dunkin' Brands Profit Rises as Revenue Slips
21 October 2016 - 12:00AM
Dow Jones News
Dunkin' Brands Group Inc. reported a 14% jump in profit for its
third quarter helped by coffee sales, but lowered its revenue
outlook for the year because of weakness at Baskin-Robbins.
The Canton, Mass., based company said sales were partially hurt
by dwindling foot traffic in stores, but that was offset by
increased average spending per visit.
Dunkin' Brands updated its 2016 outlook to 2% growth in revenue,
a drop from the 3% to 5% guided in the second quarter, driven by
weaker-than-expected sales of ice cream products related to its
Baskin-Robbins International segment.
The company, however, backed its profit expectations for the
year, saying it still sees adjusted per-share earnings between
$2.20 and $2.22.
Dunkin' recently joined with Salesforce.com Inc. to enhance its
customer loyalty program and announced a partnership with Coca-Cola
Co. to introduce a line of bottled coffee in 2017.
Over all for the period, profit rose to $52.7 million, or 57
cents a share, compared with $46.2 million, or 48 cents a share, in
the year-ago quarter. On an adjusted basis, the doughnut company
said per-share earnings rose to 60 cents from 52 cents.
Revenue slipped 1.3% to $207.1 million, driven by the sale of
Dunkin's remaining company-operated stores, in a move to become
100% franchised. Total systemwide sales increased 6.3% to $2.82
billion. Systemwide sales include sales at franchisee- and
company-operated restaurants, including joint ventures.
Analysts polled by Thomson Reuters had forecast earnings of 59
cents a share on $214.8 million in revenue.
Same-store sales at Dunkin' Donuts in the U.S. grew 2%, while
domestic same-store Baskin-Robbins sales declined 0.9%.
Shares closed at $51 and were inactive premarket. The stock has
risen 19% so far this year.
(END) Dow Jones Newswires
October 20, 2016 08:45 ET (12:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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