IHOP posts net income of $10.3M

GLENDALE Calif. IHOP Corp., parent company to the mostly franchised 1,302-unit IHOP chain, said fourth-quarter net income increased 3.7 percent from a year earlier to $10.3 million, or 57 cents per share, on revenues that remained nearly flat at $87.9 million.

As IHOP continues its transition away from financing franchisees, the company's financing and rental expenses were reduced from a year earlier, which helped boost its bottom line, yet, financing revenues also were reduced, negatively affecting corporate revenue growth.

The company reported its 16th consecutive quarter of systemwide same-store sales growth with an increase of 0.4 percent for the fourth quarter, which was driven wholly by increases in guest traffic, the company said.

For the full year, IHOP recorded profit of $44.6 million, or $2.43 per share, compared with profit of $43.9 million, or $2.24 per share, earned the year earlier. Revenues increased 0.4 percent to $349.6 million. Systemwide same-store sales rose 2.5 percent. Cash flow from operating activities increased for fiscal 2006 to $64.9 million, IHOP reported.

For the current fiscal year 2007, IHOP said it expects to earn between $2.50 per share and $2.60 per share, based on expected same-store sales growth between 2 percent and 4 percent and the addition of as many as 66 new restaurants.