Sonic Corp. announced results for the first quarter ended Nov. 30, 2012, including a system-wide same-store sales jump of 3 percent. Company drive-ins were up 4.2 percent during the quarter, while franchised units increased 2.9 percent.
The company's net income per diluted share increased 22 percent to 11 cents compared with net income per diluted share of 9 cents in Q1 of fiscal 2012. Also during the quarter, company drive-in margins improved by 80 basis points and the company purchased $18 million of stock, representing 3 percent of its outstanding stock.
"We are pleased the momentum in our business continues to build with a strong start in fiscal 2013," said Cliff Hudson, chairman and CEO. "Sustaining positive same-store sales during the quarter was the result of our improved daypart promotional strategy and effective creative messaging, complemented by our long-standing initiatives to improve customer service, product quality and value perception."
Hudson added that Sonic will enhance its media purchasing starting this month, allocating a bigger budget to national cable. Sonic's "Two Guys" campaign, brought back after a hiatus, has proven effective for the company in recent months.
The company will also focus on the implementation of a new point-of-sale system within the next two to three years, as well as a smaller — lower-cost — restaurant prototype, which will "spur increased development," according to Hudson.
Across the Sonic system, one new franchise drive-in was opened in the first quarter of fiscal 2013 versus two new franchise drive-in openings during the first quarter of fiscal 2012. New franchise drive-in openings in fiscal 2013 are expected to be slightly higher than new franchise drive-in openings in fiscal 2012.
"We are confident our multi-layered growth strategy, which incorporates same-store sales growth, leverage from higher sales, deployment of free cash flow, increasing royalty revenues and new drive-in development, will enable us to achieve double-digit earnings per share growth in the near and long term," Hudson added.
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