Wendy’s profit, sales fall in fourth quarter
DUBLIN, Ohio (AP) — Wendy’s reported lower fourth-quarter sales fell primarily due to the refranchising of its restaurants.
The maker of Frosty shakes has sold back many of its restaurants to franchisees to focus its business more heavily on franchising, rather than running restaurants. There were also higher operating and labor rates which pressured margins at company-owned restaurants during the last three months of 2016.
Sales edged up 0.8 percent at established North American restaurants. McDonald’s recently reported its sales dipped 1.3 percent at established U.S. locations, while Burger King said sales rose 1.8 percent in U.S. and Canada.
Wendy’s Co. expects comparable-store sales to rise between 2 percent and 3 percent in North America for this year, in line with Wall Street expectations.
For the quarter ended Jan. 1, Wendy’s earned $28.9 million, or 11 cents per share. Earnings, adjusted for non-recurring gains, came to 8 cents per share. Wall Street expected a penny more per share, according to Zacks Investment Research.
Total revenue was $309.9 million, less than the $312.8 million Wall Street expected, according to Zacks.
For the year, the company reported profit of $129.6 million, or 49 cents per share. Revenue was $1.44 billion.
Wendy’s expects full-year earnings in the range of 45 to 47 cents per share.
Wendy’s shares have climbed 6 percent since the beginning of the year. The stock has risen 48 percent in the last 12 months.
This story was 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
Keywords: Wendy’s, Earnings Report