Bob Evans shares jump on 2009 guidance, 4Q profit

Shares of Bob Evans Farms Inc. jumped Wednesday after the casual dining company offered fiscal 2009 guidance and said its fourth-quarter profit climbed 5 percent.

Shares climbed $5, or 17.2 percent, to $34.09.

After the market closed Tuesday, Bob Evans reported its fourth-quarter earnings, beating Wall Street analyst estimates by 11 cents per share, if a pretax gain from the sale of real-estate assets is included in the company's profit.

KeyBanc Capital Markets analyst Lynne Collier said in a note to investors that the company likely benefited from labor-management initiatives, including reduced kitchen labor at its Mimi's Cafe chain and lower overtime at the food products division.

The company also said it expects 2009 profit between $2 and $2.10 per share. Analysts polled by Thomson Financial, on average, have predicted profit of $2.02 per share for the year.

The company also said its guest traffic for the first fiscal month of 2009 was positive at the Bob Evans chain.

Collier called the fourth quarter results and traffic for the month "encouraging," but added that the guidance "assumes negative traffic and higher commodity costs."

Most restaurants are struggling to keep traffic positive as more consumers cut back on eating out to pay far higher gas prices. Higher costs for food ingredients like meat and flour have also cut into profits at many companies.

Bob Evans also reported its same-store sales, or sales at stores open at least a year, for May. Bob Evans said its same-store sales rose 4.4 percent at its namesake restaurant chain, helped by the company's Big Farm Salads promotion.

The company also reported its same-store sales dropped 5 percent at Mimi's.

Same-store sales is a key indicator of restaurant performance since it measures growth at existing locations rather than newly opened ones.