Tuesday, Sonic Corp. (SONC), an operator and franchiser of quick-service drive-in restaurants, reported a decline in profit for the first quarter resulting from a decline in revenue which is primarily due to the impact on revenue mix from refranchising 205 partner drive-ins during fiscal 2009 and to a lesser extent due to lower same-store sales on partner drive-in sales and franchise royalties.
According to the Oklahoma City-based company, net income for the quarter declined by 13% to $6.2 million from $7.1 million in the comparable period a year-ago. On a per share basis, earnings declined 17% to $0.10 from $0.12 a year-ago.
On average, 19 analysts polled by Thomson Reuters expected the company to earn $0.13 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues declined by 26% to $136.5 million from $184.1 million in the year-earlier period, reflecting primarily the impact on revenue mix from refranchising 205 partner drive-ins during fiscal 2009.
Fourteen Wall Street analysts estimated revenues of $137.05 million for the quarter.
According to Sonic, system-wide same-store sales declined 6.5%, compared with a decrease of 3.6% for the same quarter last year. The decline in system-wide same-store sales was composed of 6.0% lower same-store sales at franchise drive-ins and a 9.1% decline at partner drive-ins.
"Our results for the first quarter of fiscal 2010 continued to reflect a very challenging operating environment," said Clifford Hudson, chairman and chief executive officer. "The significant level of unemployment and its impact on consumer spending, combined with increased competition for value menu offerings, have negatively affected sales for the industry and for the Sonic system," he added.
Sonic said that based on the first quarter results and the anticipation of a continued challenging economic and credit market environment, management anticipates earnings for 2010 to be flat versus fiscal 2009 earnings, as adjusted. This expectation is primarily based on a projected decline in annual system-wide same-store sales of 4% to 6% for the fiscal year, reflecting expected improvement in the latter half of the year versus the current trend. The company also anticipates a decline in restaurant-level margins associated with the decline in sales.
Sonic expects new drive-in openings to total approximately 115 to 125 for fiscal 2010, including 100 to 110 new franchise drive-ins.
SONC is currently trading on the Nasdaq at $10.25, down $0.04 or 0.39%. In the after hours the stock traded down $0.87 or 8.49%.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.