Finding the right balance between menu innovation and value helped boost third-quarter domestic same-store sales 1.5 percent for Popeyes Louisiana Kitchen, the company said Thursday.
Same-store sales increased 1.8 percent globally during the Oct. 2-ended quarter, marking the 26th consecutive quarter of positive comparable sales. International same-store sales increased 3.7 percent.
However, same-store sales for company-operated stores declined 2 percent.
The company announced a deal to refranchise 17 company-owned units in the Indianapolis market with the goal of focusing on three remaining company-operated markets of Charlotte, N.C., New Orleans and Memphis.
The company also increased its domestic market share of the chicken quick-service category to 26.9 percent, compared with 26 percent in the third quarter a year ago.
“We are pleased to report strong progress for the quarter,” said Cheryl Bachelder, Popeyes CEO, in a statement. “We continue to expand our brand, which has led to the achievement of another record high market share of 26.9 percent. We are firmly on the path of achieving our long-term bold growth goals and we are creating value for our franchisees and shareholders.”
During the quarter, the company brought back its popular $5 Big Box, which led to record high average repeat sales in September, as well as Beer Can Rip’n Chick’n for $3.99, and a $4 Wicked Good Deal with twisted strips of chicken with dipping sauces and a biscuit.
The chain also rolled out an updated 2.0 version of a service basics program designed to resolve customer complaints.
Previously, only 55 percent of guest complaints were addressed and it took an average of 12 days, said Bachelder, in a call with Wall Street analysts.
With the new program in place, 89 percent of guest problems are now resolved within 48 hours, resulting in double-digit improvement in guest experience scores, she said.
Popeyes is investing in technology with plans to begin testing new point-of-sale and back-of-the-house tech solutions in 2017, Bachelder said.
International growth is also a priority with the goal of reaching 1,000 units overseas. At the end of the quarter, the Popeyes system included 2,631 restaurants.
Revenues for the quarter increased 4.7 percent to $64 million, compared with $61.1 million a year ago.
Net income declined to $10.4 million, or 49 cents per share, including $3.7 million in impairment charges related to the refranchising plan, compared with $10.6 million, or 46 cents per share, a year ago.
Excluding the impairment charges, adjusted earnings were 59 cents in the quarter, compared with 47 cents a year ago.
Contact Lisa Jennings at [email protected]
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