ATLANTA — AFC Enterprises Inc., franchisor and operator of Popeyes, has reported a decline of 2.1 percent in same-store sales for the fourth quarter and year ended Dec. 28, 2008. The company also provided guidance for fiscal 2009 and provided a business update on its strategic plan.
For the fourth quarter, global same-store sales fell 2.1 percent compared to 1.2 percent in the same period last year. Domestic comps were down 2.8 percent compared to a decline of 1.6 percent last year. International sales were up 4.1 percent for the quarter, up over a 1.9 percent increase a year ago.
For the year, global same-store sales fell 1.7 percent compared to a decrease of 2.0 percent last year. Domestic same-store sales were down 2.2 percent compared to a decrease of 2.3 percent in fiscal 2007. International same-store sales were up 4.1 percent compared to an increase of 1.1 percent in fiscal 2007.
Revenues were down 8.2 percent for the quarter at $35.9 million compared to $39.1 million in the same period last year. For the year, total revenues were $166.8 million, down 0.3 percent compared to $167.3 million last year. AFC Enterprises attributes the decrease to negative same-store sales and the re-franchising of company-operated restaurants.
Net income for the quarter was down 33 percent at $2.4 million compared to $3.6 million in the same period last year. For the year, net income was $19.4 million, down 16 percent compared to $23.1 million last year.
For the year, the Popeyes system opened 140 restaurants and closed 120 restaurants, resulting in the net opening of 20 restaurants and exceeding the company's previous guidance of 5 to 15 units. At the end of 2008, total unit count was 1,922 compared to 1,905 at the end of 2007.
"In 2008 we built a sound foundation for our strategic plan. While our domestic same-store sales fell short of our goals, we outpaced the chicken QSR category for the third consecutive quarter according to independent data," said AFC Enterprises CEO Cheryl Bachelder. "Our international restaurants enjoyed a good year in both same-store sales and unit growth. In total, we met our earnings expectations at $0.76 per diluted share, and we exceeded our opening guidance with 140 new restaurants globally.
"Going forward, we will continue to execute our strategic plan with an emphasis on compelling value, improving the guest experience, and strengthening restaurant profitability."
Fiscal 2009 guidance
During 2009, the company plans include:
- Emphasizing Popeyes food, QSR value and speed of service to build guest traffic and increase market share. The company is conservatively projecting global same-store sales for the year of negative 1.0 to negative 3.0 percent.
- Slowing its global new openings to 90-110 restaurants in 2009. Popeyes expects system-wide unit closings in the range of 140-160 restaurants, resulting in a decrease of 30-70 net restaurant openings in 2009.
- Continuing to tightly manage general and administrative expenses and invest in key strategic initiatives, including its continued commitment to national advertising and operations improvements.
- The company expects 2009 earnings to be in the range of 62 cents to 67 cents per diluted share, compared to fiscal 2008 earnings of 65 cents per diluted share. The company's fiscal 2009 earnings per diluted share guidance excludes the impact of one-time items and other non-operational income or expenses.
Conference call replay
A replay of the company's conference call to review the results will be available for 90 days at the company's Web site.
