On Thursday, April 12, after the market closed, doughnut chain Krispy Kreme Doughnuts
- Net sales fell 8.2% as company-owned stores saw an 11.2% sales drop. According to the company, it "made progress during the past year" even though total top-line trends remain challenging.
- The net earnings loss narrowed but was still firmly negative, dragged down by another litigation settlement charge.
- On a more positive note, operating cash flow was positive as negative capital expenditures brought in funds and long-term debt fell 10%. Management reckons it is seeing "stability in [its] overall average unit volume, [and has] developed a pipeline for new products and seen growth internationally utilizing a flexible real estate model."
- Krispy Kreme carries an unhealthy one-star rating in the Motley Fool CAPS community. Fools may want to consider more tasty prospects in the restaurant industry, including Buffalo Wild Wings
(NASDAQ:BWLD) and Sonic(NASDAQ:SONC) , which have four-star ratings, or YUM! Brands(NYSE:YUM) and McDonald's(NYSE:MCD) with their respective three-star ratings. All sell sugary treats with overall prospects that could be easier to swallow.
(Figures in thousands, except per-share data)
Income Statement Highlights
Q4 2007 |
Q4 2006 |
Change |
|
---|---|---|---|
Sales |
$112,188 |
$122,246 |
(8.2%) |
Net Profit |
($24,416) |
($37,727) |
N/A |
EPS |
($0.39) |
($0.61) |
N/A |
Get back to basics with a look at the income statement.
Margin Checkup
Q4 2007 |
Q4 2006 |
Change* |
|
---|---|---|---|
Gross Margin |
11.7% |
11% |
0.75 |
Operating Margin |
(19.1%) |
(29.1%) |
n/m |
Net Margin |
(21.8%) |
(30.9%) |
n/m |
Margins are the earnings engine.
Balance Sheet Highlights
Assets |
Q4 2007 |
Q4 2006 |
Change |
---|---|---|---|
Cash + ST Invest. |
$36,242 |
$16,980 |
113.4% |
Accounts Rec. |
$26,769 |
$26,677 |
0.3% |
Inventory |
$21,006 |
$23,761 |
(11.6%) |
Liabilities |
Q4 2007 |
Q4 2006 |
Change |
---|---|---|---|
Accounts Payable |
$7,874 |
$8,897 |
(11.5%) |
Long-Term Debt |
$105,966 |
$118,241 |
(10.4%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
Q4 2007 |
Q4 2006 |
Change* |
|
---|---|---|---|
Cash From Ops. |
$22,108 |
$1,865 |
1,085.4% |
Capital Expenditures |
($5,658) |
$3,051 |
(285.4%) |
Free Cash Flow |
$27,766 |
($1,186) |
(2,441.1%) |
Free cash flow is a Fool's best friend.
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- Blazing Hot Results at Buffalo Wild Wings
Buffalo Wild Wings is a Motley Fool Hidden Gems selection. Find out why with a free 30-day trial subscription.
Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
Fool contributor Ryan Fuhrmann has no financial interest in any company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.