The Wendy’s Company Reports 2012 Second-Quarter Results

The Company’s presentation of Adjusted EBITDA from continuing operations and Adjusted Earnings Per Share from continuing operations does not replace the presentation of the Company’s financial results in accordance with GAAP.

About The Wendy’s Company

The Wendy's Company is the world's third-largest quick-service hamburger company. The Wendy's system includes more than 6,500 franchise and Company restaurants in the United States and 27 countries and U.S. territories worldwide. For more information, visit aboutwendys.com or wendys.com.

The Wendy's Company and Subsidiaries
Consolidated Statements of Operations
Second Quarter and Six Month Periods Ended July 1, 2012 and July 3, 2011
(In Thousands Except Per Share Amounts)
					Second Quarter									Six Months
					2012				2011					2012				2011
					(Unaudited)									(Unaudited)
Revenues:
Sales					$	566,116			$	544,237				$	1,086,045			$	1,053,523
Franchise revenues						79,752				78,222					153,010				151,401
						645,868				622,459					1,239,055				1,204,924
Costs and expenses:
Cost of sales						483,080				464,798					938,547				903,669
General and administrative						73,345				74,456					145,649				149,141
Depreciation and amortization						35,947				29,842					68,258				60,156
Impairment of long-lived assets						3,270				365					7,781				8,262
Facilities relocation and other transition costs						9,426				-					14,957				-
Transaction related costs						562				5,039					1,174				6,923
Other operating expense, net						1,847				525					3,382				1,322
						607,477				575,025					1,179,748				1,129,473
Operating profit						38,391				47,434					59,307				75,451
Interest expense						(28,002	)			(28,089	)				(56,237	)			(57,531	)
Loss on early extinguishment of debt						(25,195	)			-					(25,195	)			-
Gain on sale of investment, net						-				-					27,407				-
Other income, net						640				337					2,164				590
(Loss) income from continuing operations before income taxes and  noncontrolling interests						(14,166	)			19,682					7,446				18,510
Benefit from (provision for) income taxes						8,673				(8,308	)				1,795				(7,432	)
(Loss) income from continuing operations						(5,493	)			11,374					9,241				11,078
Discontinued operations:
Income from discontinued operations, net of income taxes						-				3,672					-				2,559
Loss on disposal of discontinued operations, net of income tax benefit						-				(3,780	)				-				(3,780	)
Net loss from discontinued operations						-				(108	)				-				(1,221	)
Net (loss) income						(5,493	)			11,266					9,241				9,857
Net income attributable to noncontrolling interests						-				-					(2,384	)			-
Net (loss) income attributable to The Wendy's Company					$	(5,493	)		$	11,266				$	6,857			$	9,857
Basic and diluted (loss) income per share attributable to The Wendy's Company:
Continuing operations					$	(0.01	)		$	0.03				$	0.02			$	0.03
Discontinued operations						-				-					-				(0.01	)
Net (loss) income					$	(0.01	)		$	0.03				$	0.02			$	0.02
Number of shares used to calculate basic (loss) income per share						389,978				417,676					389,840				418,098
Number of shares used to calculate diluted (loss) income per share						389,978				419,239					392,001				419,415
														July 1, 2012				January 1, 2012
	Balance Sheet Data:													(Unaudited)				(Audited)
	Cash and cash equivalents													$	435,100			$	475,231
	Total assets														4,310,481				4,300,668
	Long-term debt, including current portion														1,394,278				1,356,999
	Total stockholders' equity														1,993,574				1,996,069

Reconciliation of Adjusted EBITDA from Continuing Operations to Net (Loss) Income Attributable to The Wendy's Company
(In Thousands)
(Unaudited)
				Second Quarter									Six Months
				2012				2011					2012				2011
Adjusted EBITDA from continuing operations				$	89,073			$	89,415				$	152,954			$	163,140
(Less) plus:
Depreciation and amortization					(35,947	)			(29,842	)				(68,258	)			(60,156	)
Impairment of long-lived assets					(3,270	)			(365	)				(7,781	)			(8,262	)
Costs associated with closed restaurants in  other operating expense, net (a)					(1,477	)			-					(1,477	)			-
Facilities relocation and other transition costs					(9,426	)			-					(14,957	)			-
Transaction related costs					(562	)			(5,039	)				(1,174	)			(6,923	)
Arby's indirect corporate overhead in  general and administrative (G&A)					-				(6,735	)				-				(14,623	)
SSG purchasing cooperative expense reversal in G&A					-				-					-				2,275
Operating profit					38,391				47,434					59,307				75,451
Interest expense					(28,002	)			(28,089	)				(56,237	)			(57,531	)
Loss on early extinguishment of debt					(25,195	)			-					(25,195	)			-
Gain on sale of investment, net					-				-					27,407				-
Other income, net					640				337					2,164				590
(Loss) income from continuing operations before  income taxes and noncontrolling interests					(14,166	)			19,682					7,446				18,510
Benefit from (provision for) income taxes					8,673				(8,308	)				1,795				(7,432	)
(Loss) income from continuing operations					(5,493	)			11,374					9,241				11,078
Discontinued operations:
Income from discontinued operations, net of income taxes					-				3,672					-				2,559
Loss on disposal of discontinued operations, net of income tax benefit					-				(3,780	)				-				(3,780	)
Net loss from discontinued operations					-				(108	)				-				(1,221	)
Net (loss) income					(5,493	)			11,266					9,241				9,857
Net income attributable to noncontrolling interests					-				-					(2,384	)			-
Net (loss) income attributable to  The Wendy's Company				$	(5,493	)		$	11,266				$	6,857			$	9,857
(a) Excludes non-cash items included in impairment of long-lived assets.

Reconciliation of Adjusted Income and Adjusted Earnings per Share from Continuing Operations to Net (Loss) Income and Earnings per Share Attributable to The Wendy's Company
(In Thousands Except per Share Amounts)
(Unaudited)
				Second Quarter																			Six Months
				2012									2011										2012									2011
				Aftertax				Pershare (a)					Aftertax				Pershare						Aftertax				Pershare					Aftertax				Pershare
Adjusted income and adjusted earnings per share from continuing operations				$	19,221			$	0.05				$	19,016			$	0.05					$	22,568			$	0.06				$	28,292			$	0.07
(Less) plus:
Loss on early extinguishment of debt					(15,621	)			(0.04	)				-				-						(15,621	)			(0.04	)				-				-
Gain on sale of investment, net					-				-					-				-						17,978				0.05					-				-
Impairment of long-lived assets					(2,018	)			(0.01	)				(224	)			(0.00	)					(4,801	)			(0.02	)				(5,073	)			(0.01	)
Costs associated with closed restaurants in other operating expense, net (b)					(911	)			(0.00	)				-				-						(911	)			(0.00	)				-				-
Facilities relocation and other transition costs					(5,817	)			(0.01	)				-				-						(9,246	)			(0.03	)				-				-
Arby's indirect corporate overhead in general and administrative (G&A)					-				-					(4,243	)			(0.01	)					-				-					(9,213	)			(0.02	)
Transaction related costs					(347	)			(0.00	)				(3,175	)			(0.01	)					(726	)			(0.00	)				(4,361	)			(0.01	)
SSG purchasing cooperative expenses in G&A					-				-					-				-						-				-					1,433				0.00
Total adjustments					(24,714	)			(0.06	)				(7,642	)			(0.02	)					(13,327	)			(0.04	)				(17,214	)			(0.04	)
(Loss) income from continuing operations and earnings per share					(5,493	)			(0.01	)				11,374				0.03						9,241				0.02					11,078				0.03
Discontinued operations:
Income from discontinued operations, net of income taxes					-				-					3,672				0.01						-				-					2,559				0.00
Loss on disposal of discontinued operations, net of income tax benefit					-				-					(3,780	)			(0.01	)					-				-					(3,780	)			(0.01	)
Net loss from discontinued operations					-				-					(108	)			(0.00	)					-				-					(1,221	)			(0.01	)
Net (loss) income					(5,493	)			(0.01	)				11,266				0.03						9,241				0.02					9,857				0.02
Net income attributable to noncontrolling interests					-				-					-				-						(2,384	)			(0.00	)				-				-
Net (loss) income and earnings per share attributable to The Wendy's Company				$	(5,493	)		$	(0.01	)			$	11,266			$	0.03					$	6,857			$	0.02				$	9,857			$	0.02
Reported number of shares used to calculate diluted (loss) income per share									389,978									419,239										392,001									419,415
Plus: Dilutive effect of stock options and restricted shares									1,748									-										-									-
Adjusted number of shares used to calculate adjusted earnings per share									391,726									419,239										392,001									419,415

(a)		Adjusted earnings per share amounts, for the second quarter of 2012, include the dilutive effect of stock options and restricted shares, which were excluded from the reported number of shares used to calculate basic and diluted loss per share, as the impact would have been anti-dilutive. Included above is a reconciliation of the number of shares used to calculate adjusted earnings per share amounts.
(b)		Excludes non-cash items included in impairment of long-lived assets.

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