Atlanta, GA-based quick-service restaurant chain
AFC Enterprises Inc.
) recently declared its preliminary fourth-quarter and full-year
In the fourth quarter, AFC Enterprises' global comps surged
0.8%, led by a 0.3% upside in domestic same-store sales and 4.2%
rise in the International Franchised same-store sales. However,
the quarterly comps were much lower than the year-ago quarter's
comps growth of 6.2%. The company-owned restaurants' comps were
down 1.2% compared with an increase 7.8% in the year-earlier
The company's global comparable store sales grew by 3.7% in
2013, down from the year-ago period's comps of 6.8%.
The domestic same-store sales have declined 3.6%, down from
7.5% in 2012 whereas International Franchised same-store sales
were 4.7%, higher from 2.6% in 2012.
The company's store opening momentum remained unruffled amid a
volatile macroeconomic situation. AFC Enterprises, which operates
and franchises Popeye's restaurants, unveiled respective 49 and
22 restaurants domestically and internationally during
In 2013, the company launched 194 restaurants
globally. This is the highest number of restaurant opening for
the company since 1999. The number of restaurant openings in 2013
was within management's guidance range of 185-195. Additionally,
AFC Enterprises shut down 68 units in 2013.
In addition, AFC Enterprises' projected net unit growth of 126
restaurants in 2013 was above the company's guidance range of
100-120 net restaurants.
At the end of the fourth quarter, the company had 2,225 units
out of which 45 were domestic company-owned outlets, 1,769
franchised domestic units and 456 franchised international
Full-Year 2013 Guidance
The company has increased its adjusted earnings guidance for
2013. The earnings in 2013 are likely to be driven by the
company's high revenue growth in fourth-quarter 2013. Moreover,
the company's expansion initiatives are expected to aid earnings
The company projects its adjusted earnings per share for the
full year of 2013 to be within $1.42-$1.43 up from the range of
$1.39 to $1.42. 2013 earnings are expected to increase 15% year
The Zacks Consensus Estimate for 2013 is $1.42 which is at the
higher end of the company's guidance range.
The company has projected that in 2013, general and
administrative costs will be $73.5 million (3% of system-wide
sales) which is within the company's prior guidance range of $74
Management announced that it has achieved significant growth
in 2013, which will help it attain noteworthy improvement in its
Popeye's business, going forward.
AFC Enterprises currently has aZacks Rank #3 (Hold). Investors
interested in the restaurant industry may consider stocks like
Fiesta Restaurant Group, Inc.
The Cheesecake Factory Inc.
Cracker Barrel Old Country Store, Inc.
). While Fiesta Restaurant sports a Zacks Rank #1 (Strong Buy),
The Cheesecake Factory and Cracker Barrel have a Zacks Rank #2
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