A leading quick-service restaurant chain
AFC Enterprises Inc.
) recently declared its preliminary fourth-quarter and full year
The company projects its adjusted earnings per share for the
full year of 2012 to be within $1.23-$1.24, up from 99 cents in
2011 as well from the previously provided guidance range of
$1.19-$1.21. The Zacks Consensus Estimate for 2012 is $1.24 per
The earnings in 2012 are likely to be driven by the company's
high revenue growth in the fourth-quarter 2012. Moreover, the
company's expansion initiatives are also expected to help
augmenting the earnings further.
In the fourth quarter, AFC Enterprises' global comps spiked
6.0% compared with 5.8% in the year-ago quarter. The solid
improvement in comps resulted from a 6.4% upside in domestic
same-store sales and 3.5% gain in the International Franchised
On the domestic front, franchised restaurant posted a 6.3%
rise in comps versus 6.2% in the year ago quarter. The
company-owned restaurants' comps were up 7.8% compared with a
decline of 1.5% in the year earlier quarter.
As per the guidance, the company also expects that its global
comparable store sales will grow by 6.8% in 2012 up from 3.1% in
2011 as well from the company's previously provided range of 6%
The domestic same-store sales surged 7.5% from 3.0% in 2011
whereas International Franchised same-store sales were 2.4% down
from 3.3% in 2011.
The company has projected that in 2012, general and
administrative costs will be $67.6 million (3% of system-wide
sales) which is within the company's previous guidance range of
$67 million - 68 million.
AFC Enterprises, which operates and franchises Popeye's
restaurants, recently, declared that during fourth-quarter 2012
it has unveiled 42 restaurants domestically and 20
In 2012, the company launched 141 restaurants. The
number of restaurant openings was within management's guidance
range of 140 - 150. The company also permanently shut down 75
units in 2012.
In addition, AFC Enterprises' projected net unit growth of 66
restaurants in 2012 was at the lower end of the company's
guidance range of 65-85 net restaurants.
At the end of the fourth quarter, the company had 2,104 units
out of which 45 were domestic company-owned outlets, 1,634
franchised domestic units and 425 franchised international
Management announced that it has achieved significant growth
in 2012, which will help it attain noteworthy improvement in its
Popeyes' business going forward.
AFC Enterprises currently retains a Zacks Rank #2 (Buy).
Restaurateurs, which are also expected to perform well, include
Bob Evans Farms, Inc.
The Cheesecake Factory Incorporated
Burger King Worldwide, Inc.
). All these stocks carry a Zacks Rank #2 (Buy).
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