Krispy Kreme Doughnuts Inc. (KKD), Thursday reported a drop in profit for the fourth quarter, due mainly to the absence of a hefty gain recorded in the prior year quarter. Adjusted earnings for the period improved from last year, but still fell short of Street estimates by a penny, while revenue growth surpassed expectations.
Moving ahead, the company lifted its full year 2014 earnings guidance, but which is still expected to miss current estimates. Following the news, Krispy Kreme shares slipped five percent in after hours trade.
Winston-Salem, North Carolina-based Krispy Kreme's fourth-quarter profit was $4.8 million or $0.07 per share, down from $143.5 million or $2.01 per share last year.
Last year's results included an unusual credit of $139.6 million from the reversal of valuation allowances on deferred income tax assets.
Excluding special items, net income for the quarter improved to to $7.4 million or $0.11 per share from $4.0 million or $0.06 per share last year. On average, six analysts polled by Thomson Reuters expected earnings of $0.12 per share for the quarter. Analysts' estimates typically exclude special items.
Krispy Kreme's revenues for the quarter grew 16 percent to $118.1 million from $102.0 million last year. Analysts estimated revenues of $115.93 million for the quarter. Same store sales rose 7.5 percent, driven by higher traffic.
Direct operating expenses as a percentage of total revenues, decreased to 83.4 percent from 86.2 percent last year.
Looking forward to the fiscal year 2014, the company lifted its adjusted earnings guidance to a range of $0.53 to $0.57 per share, from prior estimate of $0.49 to $0.55 per share. Analysts currently expect earnings of $0.58 per share for the year.
KKD closed Thursday 's regular trade at $14.95, down $0.01 or 0.07%, on the NYSE. The stock further slipped $0.74 or 4.95% in after hours trade.
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