Wendy's (WEN) Sizzles as Re-Imaging Initiative Unlocks Q4 Sales, Profit
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Investors are lovin' Wendy's (NYSE: WEN) Wednesday morning following the company's fourth-quarter 2012 report, issued ahead of the bell today.
Revenue rose 2.4 percent to $629.9 million, with company-owned North American comps falling 0.2 percent and franchise-owned comps dipping 0.6 percent. Net income rose markedly from $4.3 million to $21.4 million or about six cents per share. After adjusting for certain one-time items, EPS came in at eight cents.
Consensus views were calling for revs of $637.9 million and earnings of just four cents per share.
During the year, Wendy's closed 34 locations (including company- and franchise-owned stores), while about 17 locations were added in the fourth quarter.
"We are pleased with progress we made in 2012, as our brand transformation accelerated with Image Activation and our 'A Cut Above' brand positioning gained traction with consumers," commented CEO Emil Brolick. "[W]e will accelerate our Image Activation initiative in 2013, including the introduction of lower-investment Tier 2 and Tier 3 designs. We expect to complete 200 total reimages in 2013, including about 100 franchised reimaged restaurants. Average sales volumes for Image Activation restaurants have increased more than 25 percent, and we remain on track to reimage more than 600 Company-operated restaurants by the end of 2015."
Looking ahead, Wendy's sees FY13 adjusted EPS of 18 cents to 20 cents. North American company-owned comps are expected to rise two percent to three percent. The Street is looking for fiscal 2013 EPS of 17 cents.
Wendy's is indicated for a higher open Wednesday.
Revenue rose 2.4 percent to $629.9 million, with company-owned North American comps falling 0.2 percent and franchise-owned comps dipping 0.6 percent. Net income rose markedly from $4.3 million to $21.4 million or about six cents per share. After adjusting for certain one-time items, EPS came in at eight cents.
Consensus views were calling for revs of $637.9 million and earnings of just four cents per share.
During the year, Wendy's closed 34 locations (including company- and franchise-owned stores), while about 17 locations were added in the fourth quarter.
"We are pleased with progress we made in 2012, as our brand transformation accelerated with Image Activation and our 'A Cut Above' brand positioning gained traction with consumers," commented CEO Emil Brolick. "[W]e will accelerate our Image Activation initiative in 2013, including the introduction of lower-investment Tier 2 and Tier 3 designs. We expect to complete 200 total reimages in 2013, including about 100 franchised reimaged restaurants. Average sales volumes for Image Activation restaurants have increased more than 25 percent, and we remain on track to reimage more than 600 Company-operated restaurants by the end of 2015."
Looking ahead, Wendy's sees FY13 adjusted EPS of 18 cents to 20 cents. North American company-owned comps are expected to rise two percent to three percent. The Street is looking for fiscal 2013 EPS of 17 cents.
Wendy's is indicated for a higher open Wednesday.
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