Denny’s Corp. said on Monday that its same-store sales increased a slower-than-expected 0.5 percent in the fourth quarter ended Dec. 28 amid “ongoing and pervasive challenges” in the restaurant industry.
For the year, same-store sales increased 0.9 percent, and increased 6.7 percent on a two-year basis.
“Our same-store sales were not as strong as anticipated due to traffic pressure we experienced as we moved through the fourth quarter,” CEO John Miller said in a statement. “However, given the ongoing and pervasive challenges within the industry, we are pleased that our team’s efforts resulted in strong cash flow.”
Miller expects further challenges into 2017. “We recognize that the environment will most likely remain challenged for the foreseeable future and we are committed to delivering profitable system sales growth as the industry and consumer expectations evolve,” he said.
Denny’s preannounced its fourth quarter earnings on Monday at the start of the ICR investors conference in Orlando this week.
The Spartanburg, SC-based family dining chain said that it opened 50 locations in 2016, including 14 international locations, bringing its unit count to 1,733. The company’s unit count has grown for eight consecutive years.
Miller said the company’s unit growth was its best in five years.
Denny’s said it expects to report adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA of between $97 million and $99 million. The company plans to release its operating results on Feb. 15.
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