News

Dunkin' CEO calls Q4 sales 'disappointing'

Dunkin' Brands Group Inc, the parent company of Dunkin' Donuts and Baskin-Robbins, said comparable same-store sales declined 0.8 percent for Q4.

February 4, 2016

Fourth-quarter sales were disappointing for Dunkin' Brands Group, said Nigel Travis, Dunkin' Brands chairman and CEO. The company, which oversees Dunkin' Donuts and Baskin Robbins, reported a net loss attributable to the company of $8.9 million, or 10 cents per share, in the quarter, compared with a profit of $52.5 million, or 50 cents per share, in the same quarter of 2014.

Travis, however, remained positive about the company’s progress.

"For the year, we met or exceeded our financial performance targets including delivering nearly 10 percent adjusted operating income growth and 11 percent adjusted earnings per share growth," Travis said. "In addition to these achievements, we grew the Dunkin' Donuts U.S. restaurant footprint at greater than five percent, launched Dunkin' K-Cup pods into thousands of retail and online outlets nationwide, continued the remarkable turnaround of Baskin-Robbins U.S., and completed a successful debt refinancing at an attractive fixed interest rate."

Fiscal year 2015 highlights include:

• Dunkin' Donuts U.S. comparable store sales growth of 1.4 percent.
• Baskin-Robbins U.S. comparable store sales growth of 6.1 percent.
• Added 495 net new restaurants worldwide, including 349 net new Dunkin' Donuts in the U.S., which reflects the closing of 81 Speedway self-serve coffee stations.
• Revenues increased 8.3 percent.
• Diluted EPS decreased 34.5 percent to $1.08 which reflects a $54.3 million, or 56 cents per share, impairment of the company's investment in its joint venture in Japan.
• Diluted adjusted EPS increased 10.9 percent to $1.93.
• More than 150 million Dunkin' K-Cup pods sold into grocery channel since launch in May 2015.

Fourth-quarter highlights include:

• Dunkin' Donuts U.S. comparable store sales decline of 0.8 percent.
• Baskin-Robbins U.S. comparable store sales growth of 4.4 percent.
• Added 172 net new restaurants worldwide, including 123 net new Dunkin' Donuts in the U.S. which reflects the closing of 41 Speedway self-serve coffee stations.
• Revenues increased 5.5 percent.
• Diluted EPS decreased 60 cents to a loss of 10 cents, which reflects a $54.3 million, or 58 cents per share, impairment of the company's investment in its joint venture in Japan.
• Diluted adjusted EPS increased 13 percent to 52 cents.

2016 targets

The company expects the following:

• Dunkin'' Donuts U.S. comparable store sales growth of 0 to 2 percent and Baskin-Robbins U.S. comparable store sales growth of 1 to 3 percent.
• Dunkin' Donuts U.S. will add between 430 and 460 net new restaurants, for greater than 5 percent net unit growth, and expects Baskin-Robbins U.S. will add between 5 and 10 net new restaurants.
• The Dunkin' Donuts U.S. net development target excludes the previously-announced closing of self-serve coffee stations within Speedway locations. The company expects approximately 30 of these self-serve coffee stations to close in 2016.
• Internationally, the company targets opening approximately 200 net new restaurants across the two brands. It expects net income of equity method investments to be slightly less than 2015 full-year results.
• Revenue growth of between 4 and 6 percent.