News

Popeyes sales outpacing general QSR segment

March 9, 2011

AFC Enterprises Inc., franchisor and operator of Popeyes restaurants, reported results for fiscal 2010 ended Dec. 26, 2010.

AFC’s reported net income was $22.9 million, or $0.90 per diluted share, compared to $0.74 per diluted share in fiscal year 2009.

Fiscal year 2010 featured a total system-wide sales increase of 5.1 percent, compared to a 1.8 percent increase in 2009. Global sales were up 2.6 percent, compared to 0.7 percent in FY '09, and domestic sales rose 2.5 percent, compared to 0.6 percent in FY '09.

International same-store sales were positive for the fourth year in a row, with an increase of 3.1 percent in 2010 compared to a 1.9 percent increase in 2009.

According to independent data, Popeyes domestic same-store sales outpaced both the general quick-service restaurant and chicken QSR categories for the second consecutive year.

Net openings up, international markets planned

AFC also reported that the Popeyes system opened 106 restaurants and permanently closed 67 restaurants during FY 2010, resulting in 39 net openings. This compares to 14 net openings in 2009.

Company-operated restaurant operating profit margin was 19.2 percent of sales, an increase of 350 basis points over last year. This improvement was primarily a result of supply chain savings, declines in commodity costs, higher same-store sales, and the re-franchising of lower performing company-operated restaurants in 2009.

Cheryl Bachelder, AFC Enterprises CEO, said 2010 was a remarkable year for the company, as it witnessed positive results from its Strategic Plan initiatives.

“With improved operating performance, we grew our adjusted earnings per diluted share by 16 percent. I am proud of the entire Popeyes team for these accomplishments,” she said. “Over the past three years, we have built a strong foundation for our domestic business.”

In 2011, the company will remain focused on the same four initiatives:

• Build the brand
• Run great restaurants
• Strengthen unit economics
• Ramp up unit growth

The latter initiative includes an eye on international markets.

“We will now build on (2010’s) success by using the same strategic roadmap for our international business including making investments that we believe will help drive guest traffic, improve guest satisfaction, and strengthen our unit economics. This is the essential foundation for accelerating unit growth around the globe,” Bachelder said.

Management expects to maintain its international new unit openings at approximately 60 restaurants, comparable to the opening pace it delivered in 2010.

Also in 2011, Popeyes expects to continue promotion of its core chicken and seafood offerings and periodically introduce new, innovative menu offerings, while continuing to use national media advertising with Annie as its spokesperson.

In 2010, Popeyes announced multi-year agreements with two new marketing partners, The Coca-Cola Company and Dr. Pepper Snapple Group. As a result of the new agreements, in 2011, Popeyes will implement a unified strategy for fountain beverages that is designed to be more exciting for its guests and more profitable for its restaurants.