Papa John’s (PZZA) on Wednesday delivered a fourth quarter earnings beat on the top and bottom lines, boosted by strong same-store sales amid a turnaround strategy to reinvigorate the brand.
Here were the main numbers for Papa John’s fourth quarter, compared to Bloomberg estimates:
Revenue: $417.5 million vs. $403.8 million expected
Adj. earnings per share: 37 cents vs. 32 cents expected
U.S. same-store sales: +4.1% vs. +2.3% expected
On Nov. 6, the pizza chain announced a big management shake-up meant to stabilize the company after a turbulent period sparked by the messy ouster of its founder, John Schnatter. Papa John’s described the overhaul as a way to promote a “new, more streamlined senior management team...[that] aligns with the company’s new strategy and priorities.”
Ahead of its fourth quarter earnings report, Papa John’s stock has risen 60% over the past 12 months — outperforming a broader market that’s jumped nearly 12% in the same time period. The stock, which closed lower on Tuesday at $67.35, rose in pre-market trading.
“Papa John’s accelerated its turn-around in the fourth quarter with a second consecutive quarter of positive comparable sales, positioning us for a strong start to 2020,” CEO Rob Lynch said in a statement.
“The company’s new focused priorities and a more inclusive, winning culture are empowering our team members to innovate our products and marketing, drive sales growth, improve efficiencies and achieve better results for all of our stakeholders,” he added.
“Our 2020 plan accelerates this momentum, as we work to become the world’s best pizza company and deliver strong, long-term profit growth,” the CEO said.
However, the pizza chain’s 2020 adjusted earnings guidance was a bit softer than expectations. Papa John’s expects 2020 adjusted earnings between $1.35 per share to $1.55 per share. Analysts were predicting $1.52 per share.
Additionally, Papa John’s predicts full-year North America same-stores sales will rise between 2.5% to 5%, and international same-store sales will be up between 1.5% to 4%.
Current CEO Lynch has been at the helm since August 27 and succeeded Steve Ritchie. Ritchie was a long-time veteran of Papa John’s, and served as CEO for a rocky and short 18-month period.
Lynch is seen as an outsider who previously served the president of Arby’s, and held leadership roles at Procter & Gamble and Taco Bell.
Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.
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