Restaurant chain Jack in the Box Inc. (JACK: Quote), Wednesday reported a sharp rise in second-quarter profit, helped by re-franchising gains and improved margins. Earnings for the quarter fell short of analysts' estimates, while revenues topped expectations. Moving forward, Jack in the Box raised its outlook for fiscal year 2012.
Shares of the company gained 3.5 percent in after-hours trade on the Nasdaq, following the announcement.
The San Diego, California-based company reported second-quarter net earnings of $21.6 million or $0.48 per share, compared to $6.8 million or $0.13 per share last year.
Results for the 2012 quarter included gains of about $0.21 per share from the sale to franchisees of 37 company-operated Jack in the Box restaurants.
Excluding gains, operating earnings for the quarter were $0.27 per share, compared to $0.12 per share last year.
On average, 12 analysts polled by Thomson Reuters expected earnings of $0.32 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter were $506.36 million, compared to $505 million last year. Analysts estimated revenue of $502.86 million for the quarter.
The company realized growth in franchise and distribution sales, strongly offset by decline at company owned restaurants.
On a same-store basis, sales at Jack in the Box company restaurants rose 5.6 percent during the quarter, driven by traffic growth and increase in average check. At Qdoba Mexican Grill, same-store sales for company restaurants rose 3.8 percent.
The company also benefited from consolidated restaurant operating margin that improved to 15.5 percent from 12.3 percent a year ago.
Looking ahead to the third quarter, Jack in the Box expects same-store sales increases of 3 to 4 percent at both Jack in the Box company restaurants and Qdoba system restaurants.
For fiscal 2012, the company now expects earnings of $1.28 to $1.50 per share and operating earnings of $1.00 to $1.15 per share. It earlier estimated earnings of $1.15 to $1.43 per share and operating earnings of $0.95 to $1.10 per share.
Analysts currently expect full year earnings of $1.34 per share.
The company now expects full year same-store sales to grow 3.5 to 4.5 percent at both Jack in the Box company restaurants and Qdoba system restaurants.
It earlier estimated a 3 to 4 percent growth at Jack in the Box company restaurants, and 4 to 5 percent growth at Qdoba system restaurants.
JACK closed Wednesday at $22.45, down $0.16 or 0.71%. In after hours, the stock gained $0.78 or 3.47%.
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by RTT Staff Writer
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