Wendy’s says hurricanes hurt quarterly results; stock falls
NEW YORK (AP) — Wendy’s Co. said Wednesday that its third-quarter results were hurt by hurricanes in Florida and Texas that temporarily closed up some of its restaurants. The hamburger chain also cut its outlook for the year and its shares fell nearly 4 percent.
The company is also facing increasing competition from McDonald’s and other chains that are cutting prices on its menu items and offering delivery at more of their restaurants. Wendy’s said it will stick to its current deals, such as its $4 meal that buys diners a burger, nuggets, fries and a soda. And it said it will expand its delivery to service to about 2,500 restaurants in the U.S. by the end of the year after testing it in Dallas and Columbus, Ohio, through a partnership with online delivery company DoorDash. Like other chains, Wendy’s said that customers who had their food delivered had higher average check amounts.
Overall, the Dublin, Ohio-based company said sales rose 2 percent at existing restaurants in North America, missing the 2.3 percent growth analysts had expected, according to FactSet. It said it now expects that figure to rise 2 to 2.5 percent for the year, trimming the top end of its previous forecast of 2 to 3 percent growth for the year.
The company’s other results also missed Wall Street expectations.
It reported net income of $14.3 million, or 6 cents per share, in the three months ending Oct. 1. Adjusted earnings came to 9 cents per share, below the 12 cents per share that analysts expected, according to Zacks Investment Research.
Wendy’s posted revenue of $308 million, slightly below the $308.6 million analysts expected, according to Zacks.
Shares of Wendy’s fell 62 cents to $14.12 in trading Wednesday.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on WEN at https://www.zacks.com/ap/WEN