Denny's Revenue Drops, Comps Positive
Full-service restaurant operator Denny's served up another quarter of positive same-store sales growth, its ninth out of the last 10, despite reporting third-quarter results after the markets closed yesterday showing revenues of $117.3 million, a 3% drop from the $120.9 million in the same period the previous year, though pretty much in-line with the $117.9 million Capital IQ consensus estimate. However, adjusted net income was flat at $7 million, or $0.08 per share, from Q3 2012's $7 million, or $0.07 per share, which was also in-line with CapIQ estimates.
With a net reduction of one restaurant from the year-ago period, and down four stores sequentially, the restaurant operator felt pressure from occupancy revenue and initial fees from franchisees. For the third quarter, franchise and license revenue was $33.9 million compared with $34.4 million in Q3 last year.
Denny's anticipates comps for the full year will be flat to 1% higher from 2012 with net restaurant growth of zero to five new stores, and adjusted EBITDA at the lower end of its initial guidance range of $76 million to $80 million.
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