Denny’s Corp. reported positive second quarter results, fueled in part by affordable menu pricing and limited time offers, the company said Tuesday.
Net income at the Spartanburg, S.C.-based family-dining chain rose 32 percent to $8.1 million, or eight cents per share, compared with $5.5 million, or five cents per share, for the same period a year ago.
Denny’s systemwide same-store sales rose 2 percent, with same-store sales for company locations increasing 2.6 percent for the June 29-ended quarter. Franchised units generated a 1.8-percent increase for the period.
It was the first time since the third quarter of 2007 that both company and franchise same-store sales increased in the same period, the company said.
Denny’s same-store guest counts rose 1.4 percent at company-owned units — the first time since the third quarter of 2006 that both same-store sales and guest count were positive.
“Denny's positive same-store sales and guest counts are a testament to the success of our current market strategies, emphasizing everyday affordability with attractive limited time only products,” John Miller, Denny’s president and chief executive, said in a statement.
“We are especially pleased that we can achieve an increase in sales and profitability despite significant headwinds coming from inflationary pressures and the challenging consumer economic environment,” Miller said. “Our franchisees continue to be excited about growing the brand, as evidenced by the opening of 19 new units in the second quarter of this year."
The company’s total operating revenue increased by $800,000 to $135.9 million for the second quarter.
Company restaurant sales decreased $1.3 million in the second quarter because of 11 fewer equivalent restaurants compared with the year-ago quarter.
During the quarter, Denny’s opened 19 new units, including seven Flying J Travel Center conversion sites, two international units and a new Pilot Travel Center.
“The strong same-store sales, unit development and profitability produced in the second quarter demonstrates the success of our franchise focused business model, which is enabling us to grow free cash flow, strengthen our balance sheet and pursue additional shareholder-friendly activities,” Mark Wolfinger, Denny’s chief financial officer, said in a statement.
“Although we anticipate building on the momentum from the second quarter, we remain cautiously optimistic.”
Denny's operates more than 1,670 franchised, licensed, and company-owned restaurants in the United States and around the world.
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