NEWS: Sonic Corp. on Monday reported a 16 percent drop in its fiscal fourth-quarter net income as one-time charges outweighed improved sales at its restaurants.
The company, based in Oklahoma City, is the nation's largest operator of drive-in restaurants.
DETAILS: Sonic was weighed down by a $3.9 million charge tied to debt refinancing, along with a $2.4 million write-down associated with closing 12 of its weaker restaurants. It also recorded a $1.6 million impairment charge to write down the value of some assets as it switched vendors for a new payment system.
NUMBERS: Net income fell to $12.2 million, or 21 cents per share, for the quarter that ended Aug. 31. That is down from $14.5 million, or 25 cents per share, in the same period last year. After adjusting for the special items, the company earned 30 cents per share versus 25 cents per share last year.
Revenue rose 5 percent, to $158.8 million from $150.9 million, on improved sales at its company-owned drive-ins and higher franchise fees.
Analysts polled by FactSet were anticipating earnings of 30 cents per share on revenue of $157 million.
FUTURE: Sonic said that its key initiatives, which include new products and improved promotions, will increase its earnings per share by 14 to 15 percent for 2014 compared with adjusted profit in 2013. That implies profit of 82 to 83 cents per share, slightly below Wall Street's estimate of 84 cents.
The company also said it expects its revenue from restaurants open at least a year, a key industry measure as it strips away recently opened and closed sites, will increase in the low sing-digit range. Sonic plans to open 40 to 50 new franchise drive-ins for the year and close fewer sites than it did in 2013.
STOCK: Sonic shares increased 3 cents to close at $18.65 and were unchanged in after-hours trading.
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