GLENDALE, Calif. (AP) -- The owner of the Applebee's and IHOP saw first-quarter net income fall 40 percent as traffic declined at both restaurant chains and it franchised multiple locations, but it beat Wall Street profit expectations and shares edged higher in early trading.
DineEquity Inc. posted net income of $17.9 million, or 93 cents per share, down from $29.9 million, or $1.64 per share, in the same quarter of 2012.
Excluding one-time items, the company posted an adjusted profit of $1.14 per share, easily topping the $1.01 that analysts were expecting.
Revenue dropped 34 percent to $163.2 million from $245.6 million.
During 2012, the Glendale, Calif., company sold off a large number of its Applebee's restaurants as it transformed them into a franchised system. Revenue at restaurants open at least a year fell 1.3 percent at Applebee's locations and 0.5 percent at IHOP locations. At both brands, customer traffic decreased, but was partially offset by an increase in the average guest check.
Same-store revenue is a key measure of a retailer's health, because it excludes the volatility of locations that have recently opened or closed.
Shares rose about 1 percent, or 70 cents to $71.10 at the opening bell.