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Papa John's net up on lower expenses
May 5, 2009
LOUISVILLE, Ky. -- Comparable-store sales at domestic Papa John's restaurants increased 0.3 percent for the first quarter ended March 29, the company announced. The timing of the Easter holiday weekend was estimated to have had a beneficial 0.3 percent impact on the first quarter results, and is expected to have a similar negative impact on second quarter results.
Revenues for the first quarter were $285 million, off slightly from revenues of $289. The decline was primarily due to the divestiture of 62 company-owned restaurants to franchisees during the fourth quarter of 2008.
Net income for the quarter was $17.8 million, up 107 percent compared with net income of $8.6 million for the 2008 first quarter. Results from Q1 2009 included a gain of $5.9 million from the company's cheese purchasing cooperative, while Q1 2008 results included a net loss of approximately $5.2 million from the cheese purchasing cooperative.
The company also benefited from an improvement in margin as a result of pricing and product mix profitability, a decrease in discretionary local advertising spending, and lower salary and benefit costs.
Papa John's opened 17 domestic restaurants – three company-owned and 14 franchised - during the quarter and closed 21 domestic restaurants -four company-owned and 17 franchised. The company opened 34 international franchised restaurants and closed six - one company-owned and five franchised – during the quarter.
As of March 29, there were 3,404 domestic and international Papa John's restaurants - 612 company-owned and 2,792 franchised - operating in all 50 states and 29 countries. The company is projecting full-year net worldwide unit growth of 100 to 140 units and full-year domestic system-wide sales ranging from flat to negative 2 percent.
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