News
Krispy Kreme reports narrower net loss for Q4, year
April 15, 2009
WINSTON-SALEM, N.C. — Krispy Kreme Doughnuts Inc. has reported a slight increase in same-store sales for the fourth quarter ended Feb. 1 with a yearly net loss that is significantly narrower than in prior years, the company has announced.
Same-store sales at company-owned locations were up 0.9 percent in the fourth quarter and finished down 0.7 percent for the year, improving over year-to-date third quarter same store sales, which were down 8.3 percent.
The number of off-premises locations where Krispy Kreme doughnuts were sold fell 6.8 percent compared to an increase of 1.9 percent in the same period last year. For the year, the number of off-premises locations selling Krispy Kreme doughnuts fell 7.0 percent, compared to a decline of 1.1 percent in the prior year. Sales at those locations were down 4.2 percent compared to a decline of 7.7 percent. For the year, sales at off-premises locations were down 7.5 percent compared to a decline of 6.4 percent last year.
Revenue for the quarter was down 17.2 percent to $91.8 million compared to $110.9 million in the same period last year. For the year, revenue was down 10.6 percent to $384 million compared to $429.3 million last year.
The net loss for the year was $303,000 compared to a loss of $31.8 million in the same period last year. For the year, the company's net loss was $4.1 million, compared to a loss of $67.1 million last year.
"We are seeing early signs of progress toward achieving a number of our strategic goals," said Jim Morgan, Krispy Kreme chairman, president and CEO. "We earned an operating profit for the fourth quarter and also for the year, our first annual operating profit since fiscal 2004. We've also made measurable progress in implementing our initiatives."
That progress includes:
- Opening of the first company-owned new small retail concept shop March 31. The unit is a traditional factory store on a smaller scale, paired with tunnel oven technology that will enable the company to offer its signature hot Original Glazed doughnuts virtually around the clock; the second opened April 9, and seven additional sites are planned.
- Domestic franchisees opening five new small retail shops in fiscal 2009 and have additional stores planned.
- Indentifying new, longer shelf-life products for distribution to off-premises customers beginning in late May to more closely match off-premises product offerings to consumer preferences.
- Implementing new food and labor cost management tools and training to improve shop operations.
Management will host a conference call to review fourth quarter and annual results April 16 at 4:30 p.m. Eastern time. A live webcast of the conference call will be available atwww.KrispyKreme.com. To access an archived audio replay of the call, dial (888) 203-1112 and enter the passcode 6897534. International callers may access the replay by dialing (719) 457-0820 and entering passcode 6897534. The audio replay will be available through April 22, 2009.
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