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Denny’s upgrades outlook for year

Denny’s upgrades outlook for year

Brand revitalization efforts paying off, company says

Denny’s Corp.’s investments in food, service and atmosphere paid off in the third quarter, with a 6.1-percent increase in domestic systemwide same-store sales, the company said Tuesday.

At company-owned locations, same-store sales increased 7 percent, and rose 5.9 percent at domestic franchised restaurants.

Net income for the Sept. 30-ended quarter increased 7.3 percent, to $9 million, or 11 cents per share, compared with $8.3 million, or 10 cents per share, a year ago. Revenue grew 5.8 percent, to $123.8 million.

“Throughout the third quarter, brand momentum continued as we generated strong same-store sales growth at both franchised and company restaurants,” said John Miller, Denny’s president and CEO. “This includes growth in guest traffic over the past year for the system and since 2013 at company restaurants.”

Miller noted that only 30 percent of the 1,700-unit system is expected to undergo remodeling to the new “Heritage” design by the end of the year, indicating that the company has an opportunity to build on its progress as the new design reaches more locations.

The Spartanburg, S.C.-based company upgraded its outlook for the year, saying company same-store sales would increase between 6 percent and 6.5 percent, compared with earlier projections of increases between 5.5 percent and 6 percent. Domestic franchise same-store sales are expected to grow between 5.2 percent and 5.7 percent, an increase from earlier projections of 5 percent to 6 percent.

“Based on our improved operations, we expect to continue to invest in our strategies to further elevate the Denny’s experience, and build on our momentum in the coming years,” Miller said.

For the full year, 44 to 46 restaurant openings are expected, rising from 40 to 45 units expected earlier, including four company-operated units in partnership with Kwik Trip convenience stores. Net restaurant growth is expected to be between four to eight restaurants.

Contact Lisa Jennings at [email protected].
Follow her on Twitter: @livetodineout

TAGS: Finance News
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