Papa John's sales bolstered by kick off of football season

Nov. 1, 2012 | by Alicia Kelso

Papa John's International Inc. reported its financial results Q3 ended Sept. 23, including a systemwide comp sales increase of 2.5 percent in North America, and 6.9 percent in its international division.

CEO/founder John Schnatter said this performance was despite a sluggish summer economy and was in part bolstered by the start of the NFL season in which Papa John's is marking its third year as the Official Pizza sponsor for the league.

"Our partnership with Peyton Manning has been a hit with consumers as we launched our 2 million pizza giveaway," Schnatter said. "Partnering with one of the most powerful brands (NFL) and one of the most likeable spokesmen is something we hope to capitalize on for some time."

Last week, Manning also became a Papa John's franchisee and will operate more than 20 units in the Denver area.

Another Q3 highlight for the brand was the opening of its milestone 4,000th restaurant, which is located in New Hyde Park, N.Y. During the quarter, the company opened 56 net new units around the world.

International performance

Schnatter added that Papa John's international division continues to perform well with revenues up 17 percent. The company has a robust international pipeline of about 1,500 new units planned within the next six years.

"Our international franchises are winning by focusing on product quality and running restaurants the Papa John's way," Schnatter said. "Both our international and pizza scores hit an all time high during the quarter. Nothing is more important to me than hitting on the fundamentals."

Other call highlights

During today's earnings call, Schnatter also took a moment to recognize the victims of Hurricane Sandy. Papa John's has about 15,000 team members from North Carolina through Connecticut working with the American Red Cross to dispatch mobile kitchens in some of the hardest hit areas.

Papa John's earnings per diluted shares during the quarter were 55 cents, a 25-percent jump over the same period last year.

The company's revenues and comps were provided a favorable lift from its net acquisition of 50 restaurants in the Denver and Minneapolis markets. Third quarter revenues were $325.5 million, a 6.5 percent increase from Q3 2011.

Third quarter 2012 net income was $13.2 million compared to Q3 2011 net income of $11.1 million.

Chief Marketing Officer Andrew Varga touched upon digital contributions to the company's sales, but wouldn't get into specifics other than orders from online/mobile platforms are in excess of 35 percent.

"From an online perspective, we continue to see solid growth. Digital marketing, that includes online and mobile, are critical components to our business model," he said.

Read more about operations management.

Topics: Franchising & Growth , Marketing / Branding / Promotion , Online / Mobile / Social , Operations Management , Papa John's

Alicia Kelso / Alicia has been a professional journalist for 15 years. Her work with, and has been featured in publications around the world, including NPR, Good Morning America, Voice of Russia radio, and Franchise Asia magazine.
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