DineEquity Inc. (DIN: Quote), the owner of the Applebee's and IHOP restaurant chains, Thursday reported a drop in profit for the fourth quarter, hurt mainly by the sale of Applebee's company-operated restaurants and higher income taxes.
Earnings for the three-month period beat analysts' expectations, but revenues fell short of estimates.
Glendale, California-based DineEquity's fourth-quarter profit dropped to $18.0 million or $0.97 per share from $27.3 million or $1.51 per share last year.
DineEquity blamed a lower gain on the disposition of assets, lower segment profit due to the refranchise and sale of Applebee's company-operated restaurants and higher income taxes as the primary reasons for the decline in profit.
Excluding special items, earnings for the quarter dropped to $0.83 per share from $0.91 per share last year. Analysts polled by Thomson Reuters expected earnings of $0.82 per share for the quarter. Analysts' estimates typically exclude special items.
Total segment revenues for the quarter declined to $158.6 million from $242.2 million last year. Five analysts had a consensus revenue estimate of $161.87 million for the quarter.
Applebee's domestic system-wide same-restaurant sales increased 0.9 percent, while IHOP's domestic system-wide same restaurant sales decreased 2.6 percent.
Chief Executive Julia Stewart said, "For DineEquity, 2012 was a year of milestones. The year was marked by accomplishing what we set out to do when we acquired Applebee's, completing the transition to a 99% franchised restaurant system. In addition, we reduced total debt by over $1.0 billion since the acquisition in 2007."
DineEquity also approved a first quarter dividend of $0.75 per share, payable on March 29 record as of March 15. The board also approved a $100 million share repurchase authorization, effective immediately.
DIN is currently trading at $75.84, up $3.56 or 4.93%, on the NYSE.
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by RTT Staff Writer
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