Popeyes Louisiana Kitchen Inc. raised its outlook for the year Wednesday, saying menu innovation, compelling advertising and improved restaurant execution boosted sales during the second quarter ended July 12.
Global same-store sales increased 7.5 percent, which lapped an increase of 3.6 percent in the second quarter last year, for a two-year compounded growth rate of 11.4 percent.
Same-store sales climbed 7.9 percent at domestic units. Popeyes said it was the 29th consecutive quarter the chain has outpaced the quick-service chicken segment.
International same-store sales increased 4.3 percent during the quarter.
For the year, Popeyes officials projected same-store sales would increase 4.5 percent to 5.5 percent, an increase from previous guidance of 3.5 percent to 4.5 percent.
“The ongoing strength of the Popeyes brand was demonstrated again in our second-quarter results,” Popeyes CEO Cheryl Bachelder said in a call with analysts Thursday. “We’re now in our seventh consecutive year of positive same-store sales growth, and we’re sustaining that momentum through an emphasis on strategic brand-building activities and human capital investments.
“With our compelling, Louisiana-inspired menu innovation, steady net unit growth and increasing free cash flow, Popeyes is poised for significant growth in the coming years,” she said.
Weekly sales hit a new all-time high, Bachelder said, exceeding records previously set during the Red Stick Chicken promotion earlier this year.
Popeyes also continued to increase its domestic market share of the quick-service chicken segment, to 25.4 percent, compared with 23.1 percent a year ago, a gain of almost 11 percentage points in seven years, Bachelder said.
During the quarter, Popeyes promoted a $5 Bonafide Big Box value meal, along with Smoky Garlic Chile Chicken and Hushpuppy Butterfly Shrimp limited-time offers.
Net income rose 24 percent, to $10.3 million, or 44 cents per share, compared with $8.3 million, or 35 cents per share, a year ago.
Revenue increased nearly 11 percent, to $59.4 million, compared with $53.7 million a year ago.
The Atlanta-based chain ended the second quarter with 2,443 restaurants.
For the year, Popeyes expects to add 200 to 225 new restaurants, of which 85 to 95 will be international units. Net restaurant openings are expected to be between 115 to 150. The company expects to open three to five units this year.
Contact Lisa Jennings at [email protected].
Follow her on Twitter: @livetodineout
