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The Wendy's Management Discusses Q2 2012 Results - Earnings Call Transcript

Today's conference call and our webcast is accompanied by a PowerPoint presentation, which can be found on the Investor Relations page at our corporate website, For those of you who are listening by the phone today, please make sure you select the appropriate webcast player option from our website and that will ensure that you can sync up with the slides and the audio.

Before we begin, I'd like to refer you for just a minute to the Safe Harbor statement that is attached to today's news release. Certain information that we may discuss today regarding future performance such as financial goals, plans and development is forward-looking. Various factors could affect the company's results and cause those results to differ materially from those expressed in our forward-looking statements. Some of those factors are referenced in the Safe Harbor statement that is attached to the news release. Also, some of the comments today will reference non-GAAP financial measures, such as adjusted earnings before interest, taxes, depreciation and amortization. Investors should refer to our reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measure.

Now with that, I'd like to it over to Emil.

Emil J. Brolick

Thank you, John, and good morning. As we review the results of our second quarter performance, I believe we are beginning to see positive signs in our quest to become a cut above in all aspects of the Wendy's brand experience. We are very encouraged, but we're certainly not satisfied.

Second quarter system same-store sales growth of 3.2% marked our fifth consecutive quarter of positive, system same wide store sales. This growth was the result of improved restaurant operating experience, compelling product messages and integrated marketing that really is beginning to resonate with consumers.

Our company-operated restaurant margin increased 20 basis points in the quarter, as our average check increase was mostly offset by investment in labor to improve the consumer experience and increases in commodities. As Steve will explain, we believe we have opportunities to improve margin.

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