WINSTON-SALEM N.C. Citing smaller store layouts and cost-saving technologies, Krispy Kreme Doughnuts Inc. said Thursday its fourth-quarter net loss narrowed significantly from the same quarter a year ago to less than one cent per share.
The company also noted that it had reached an agreement with lenders to remain compliant with its credit facilities and debt obligations. At fiscal year end, the company holds about $39 million in debt.
Krispy Kreme’s stock rose 51.8 percent Thursday to close at $3.46 per share. It has traded between $1.01 per share and $5.65 per share during the past year.
For the quarter ended Feb. 1, the company reported a net loss of $303,000, compared with a year-ago net loss of $31.8 million, or 50 cents per share.
Fourth-quarter revenues fell 17 percent to $91.7 million, but same-store sales rose 0.9 percent.
The company was able to trim all expenses in the latest quarter, including a 17-percent reduction in operating costs and a near halving of amortization and depreciation expenses. The company also logged a $27.6 million impairment charge a year earlier, further hurting that quarter’s bottom line and easing comparisons in the latest quarter.
Still, the troubled operator or franchisor to about 400 restaurants said some traction was being gained through a number of initiatives, including the introduction of longer-shelf-life wholesale products, the reorganization of on- and off-premise operations, increased regional and global supply chain opportunities and the implementation of new food and labor cost management tools and training. Krispy Kreme and its franchisees also have begun opening smaller stores to reduce costs.
“We are seeing early signs of progress toward achieving a number of our strategic goals,” said Jim Morgan, Krispy Kreme’s chairman, president and chief executive.
Fourth-quarter operating income totaled $1.5 million, compared with a loss of $25.2 million in the same quarter a year earlier.
For the full fiscal year, the company narrowed its loss to $4.1 million, or 6 cents per share, compared with a loss of $67.1 million, or $1.05 per share, a year earlier.
Total revenues fell 10.5 percent to $384 million. Same-store sales fell 0.7 percent.
The company posted its first annual operating profit — of $4.8 million — since its fiscal year 2004.
Contact Elissa Elan at [email protected].