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Image source: Popeyes Louisiana Kitchen.
Popeyes Louisiana Kitchen (PLKI +0.00%) released solid third-quarter 2016 results Wednesday after the market closed. With shares down slightly since the chicken-centric fast-food chain revealed that competition was putting pressure on last quarter's same-store sales, let's fasten our bibs and dig in to what Popeyes accomplished over the past three months.
Metric |
Q3 2016 Actuals |
Q3 2015 Actuals |
Growth (YOY) |
---|---|---|---|
Revenue |
$64.0 million |
$61.1 million |
4.7% |
GAAP net income |
$10.4 million |
$10.6 million |
(1.9%) |
GAAP earnings per diluted share |
$0.49 |
$0.46 |
6.5% |
Data source: Popeyes Louisiana Kitchen.
With last quarter's domestic same-store sales weakness in mind, Popeyes CEO Cheryl Bachelder stated:
We are pleased to report strong progress for the quarter. We generated global same-store sales of 1.8%, opened 25 net new global restaurants, and announced the refranchising of the Indianapolis company-operated market. We continue to expand our brand, which has led to the achievement of another record high market share of 26.9%. We are firmly on the path of achieving our long-term bold growth goals, and we are creating value for our franchisees and shareholders.
Even so, Popeyes modestly reduced its earnings guidance for the full year and now expects adjusted earnings per share to be near the lower end of its prior $2.10-to-$2.15 range. Meanwhile, Popeyes effectively reiterated its guidance for net new restaurant openings this year of 140 to 185 (including 85 to 100 internationally), and for share repurchases of roughly $100 million, the midpoint of its previous $80 million-to-$120 million range. Same-store-sales growth is still expected to be in the range of 1% to 2% for the year.
All told, there were no big surprises from Popeyes this quarter. Rather, investors saw more of the same market-share gains and a return to modest same-store-sales growth in the domestic chicken QSR segment. All the while, Popeyes continues its steady global expansion and generous capital returns initiatives. So while the market's reaction on Thursday might not indicate as much, given another selective reduction to guidance, I think Popeyes investors should be happy with where their company stands today.