What is in this article?:
- Papa John's: Digital ordering growth helps lift 1Q sales
- International progress
Founder and CEO John Schnatter said that successful ads and international growth also contributed to positive results for the quarter.
The 8.2-percent increase in international same-store sales during the first quarter capped a three-year cumulative increase of 22 percent.
Though the company didn’t break down results by region, executives indicated that Papa John’s units are performing particularly well in Latin America, the United Kingdom and Russia.
Schnatter said the company’s international progress is “like night and day” from five years ago. He credited efforts to improve food quality internationally, saying the products offered in Papa John’s units overseas now mirror those offered in the U.S.
Analysts asked if Papa John’s was benefitting in China from supply chain setbacks faced by competitor Yum! Brands Inc.’s Pizza Hut brand there. In response, Schnatter said, “I wouldn’t say we’re taking from Pizza Hut.”
Pizza Hut restaurants in China tend to be bigger restaurants, he added, “more like a T.G.I. Friday’s.”
Instead, he attributed Papa John’s success in China to the brand’s model and continuing momentum, saying there is plenty of room for growth in markets like Beijing, where Papa John’s has 50 units currently and plans to reach 100 by late 2014 or early 2015.
For the year, Papa John’s upgraded its outlook, saying earnings per share would likely be between $2.90 and $3. Previously, the company had projected earnings between $2.85 to $2.95.
The company’s borrowing capacity on its line of credit was also increased to $300 million from $175 million with the maturity date extended to April 2018.