Sonic Corp. (NASDAQ: SONC), the nation's largest chain of drive-in restaurants, today announced results for the first quarter ended November 30, 2012.
Key highlights of the company's first quarter report included:
- The company's net income per diluted share increased 22% to $0.11 compared with net income per diluted share of $0.09 in the first quarter of fiscal 2012;
- System-wide same-store sales increased 3.0% during the first quarter, with an increase of 4.2% at company drive-ins and 2.9% at franchise drive-ins;
- Company drive-in margins improved by 80 basis points; and
- The company purchased $18 million of stock representing 3% of its outstanding stock.
“We are pleased the momentum in our business continues to build with a strong start in fiscal 2013,” said Cliff Hudson, Chairman and Chief Executive Officer. “Sustaining positive same-store sales during the quarter was the result of our improved day-part promotional strategy and effective creative messaging, complemented by our long-standing initiatives to improve customer service, product quality and value perception. This growth in sales led to an 80 basis point improvement in drive-in margins. In addition, during the quarter, we purchased $18 million of stock representing more than 1.8 million shares or approximately 3% of our outstanding stock. These three factors – same-store sales growth, operating leverage and use of free cash flow 1 – are key components in our multi-layered growth strategy.
“We will continue to focus on key initiatives to drive our multi-layered growth strategy in calendar 2013. Starting this month, we will enhance our media purchasing by allocating a greater percentage of our media spend to national cable. In addition, over the next two to three years, initiatives such as our new point-of-sale system will complement our same-store sales initiatives to increase sales and profits and the new lower-cost small building prototype will improve return on investment on new drive-ins, spurring increased development,” added Hudson. “We are confident our multi-layered growth strategy, which incorporates same-store sales growth, leverage from higher sales, deployment of free cash flow, increasing royalty revenues and new drive-in development, will enable us to achieve double-digit earnings per share growth in the near and long term.”