Stock Monitor: Jamba Post Earnings Reporting
LONDON, UK / ACCESSWIRE / July 13, 2018 / If you want access to our free earnings report on Sonic Corp. (SONC), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=SONC. The Company reported its financial results on June 26, 2018, for the third quarter of the fiscal year 2018, ended May 31, 2018. The Company surpassed analysts' estimates for earnings but missed revenue forecasts in Q3 FY18. Register today and get access to over 1,000 Free Research Reports by joining our site below:
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Earnings Highlights and Summary
For Q3 FY18, Sonic's total revenues reached $118.31million, reflecting a decrease of 4.58% from $123.99 million in Q3 FY17. The Company's revenue numbers missed analysts' consensus estimates by $0.35 million. During the quarter under review, the Company drive-in sales revenues fell 7.60% to $66.59 million on a y-o-y basis, while its franchise royalties and fees increased 0.06% to $48.25 million on a y-o-y basis. Besides, the Company's lease revenues also dropped 8.89% to $2.20 million on a y-o-y basis in the reported quarter.
For Q3 FY18, Sonic's system same-store sales declined 0.2% on a y-o-y basis, consisting of a same-store sales decrease at Franchise drive-ins of 0.2% and an increase at Company drive-ins of 0.2%. The Company's same-store sales performance for the reported third quarter reflects a material improvement in trend, driven by ongoing initiatives to increase marketing reach, refresh its advertising creative, and introduce relevant new products, including the Sonic Signature Slinger and Pretzel Twist. During the reported quarter, the Company's drive-in margins declined by 10 basis points compared to the prior year's same quarter. Besides, Sonic opened 5 new drive-ins in Q3 FY18.
For Q3 FY18, Sonic's total costs of drive-in sales were $54.37 million, 7.54% lower than $58.81 million in Q3 FY17. During the reported quarter, the Company's selling, general, and administrative expenses (SG&A) increased 1.71% to $21.12 million on a y-o-y basis, while its depreciation and amortization expenses advanced 0.48% to $9.57 million on a y-o-y basis. Sonic reported an income from operations of $37.26 million in Q3 FY18, 5.14% higher than $35.44 million in Q3 FY17. On a non-GAAP basis, the Company had an adjusted income from operations of $34.45 million in the reported quarter, representing a slight decrease of 0.52% from $34.63 million in the prior year's comparable quarter.
Sonic generated a net income of $21.58 million in the quarter ended May 31, 2018, an increase of 15.07% from $18.75 million in the corresponding period of last year. The Company's diluted net earnings per share (EPS) also jumped 31.82% to $0.58 in the quarter under review from $0.44 in Q3 FY17. Sonic's earnings results for Q3 FY18 included payment card breach expenses, a net gain on refranchising transactions, and their associated tax impact. Excluding these non-recurring items, the Company's adjusted diluted EPS were $0.52 in Q3 FY18, 20.93% higher than $0.43 in Q3 FY17; and exceeded analysts' consensus estimates by $0.03 per share.
Sonic had cash and cash equivalents of $44.87 million as on May 31, 2018, 100.85% higher than $22.34 million as on August 31, 2017. The Company's long-term debt (due after one year, net of debt issuance costs) was $701.85 million as on May 31, 2018, up 11.74% from $628.12 million as on August 31, 2017.
During Q3 FY18, Sonic continued to return capital to shareholders. The Company repurchased 1.5 million shares in the reported quarter, bringing the total to 4.30 million shares repurchased for the first nine months of the fiscal year 2018, or 9.8% of shares outstanding. Sonic expects leverage to remain near the high-end of 3.5x to 4.5x net-debt-to-EBITDA target, and anticipates returning a cumulative $500 million to $600 million in capital to investors from FY18 through FY21 through a combination of dividends and share repurchases.
For the full fiscal year 2018, Sonic expects adjusted EPS to be between $1.45 and $1.49, inclusive of the tax reform. Excluding the impact of the tax reform, the Company expects adjusted EPS to increase by 3% to 6% on a y-o-y basis in FY18.
For FY18, Sonic expects same-store sales for the system to be down 1% to flat on a y-o-y basis. The Company intends to open 50 to 55 new franchise drive-ins during FY18; and anticipates a capital expenditure of $40 million to $41 million, and a free cash flow of approximately $60 million for FY18.
Stock Performance Snapshot
July 12, 2018 - At Thursday's closing bell, Sonic's stock was marginally up 0.17%, ending the trading session at $35.04.
Volume traded for the day: 477.60 thousand shares.
Stock performance in the last month - up 7.45%; previous three-month period - up 33.43%; past twelve-month period - up 35.50%; and year-to-date - up 27.51%
After yesterday's close, Sonic's market cap was at $1.26 billion.
Price to Earnings (P/E) ratio was at 23.31.
The stock has a dividend yield of 1.83%.
The stock is part of the Services sector, categorized under the Restaurants industry. This sector was up 0.8% at the end of the session.
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