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AFC swings to a profitable 4-Q

Helped by an extra operating week in fiscal 2006 and by sales from acquired franchised units, AFC Enterprises Inc., the franchisor or operator of 1,878 Popeyes Chicken & Biscuits restaurants, posted a fourth-quarter profit, versus a loss a year earlier, on corporate revenues that rose 31.1 percent to $40 million.

For the quarter ended Dec. 31, which had 13 weeks, AFC posted a profit of $5.6 million, or 19 cents per share, compared with a loss of $1.5 million, or 5 cents per share, in the year-earlier quarter, which had 12 weeks.

The company previously had reported a 3.1-percent same-store sales decrease at domestic units for the fourth quarter of fiscal 2006.

For the year, net income fell 85 percent because of year-earlier gains from the sale of AFC's former Church's Chicken brand. In fiscal 2006, net income totaled $22.4 million, or 75 cents per share, compared with fiscal 2005 earnings of $149.6 million, or $5.14 per share. In fiscal 2005, AFC booked a one-time, after-tax gain of $158 million from the sale of Church's.

Full-year revenue grew 6.8 percent to $153.0 million. Domestic same-store sales increased 1.6 percent from the year earlier.

AFC said this year's quarterly same-store sales trends are expected to remain negative in the first quarter, but should strengthen through the year to a positive 1.5 percent to 2.5 percent increase by yearend. Fiscal 2007 per-share earnings are expected to grow between 15 and 20 percent, the company also reported.

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