This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Sonic Increases Share Repurchase Program

Stock quotes in this article: SONC

Sonic Corp. (NASDAQ: SONC), the nation's largest chain of drive-in restaurants, today announced that its Board of Directors increased its share repurchase authorization from $40 million to $55 million.

The company has repurchased approximately $25 million of the original $40 million authorized in August 2012. The increased authorization leaves approximately $30 million of unspent authorization. Since September 2011, the Company has expended approximately $55 million for the repurchase of 6.6 million shares representing approximately 11% of its outstanding common stock. The authorization expires August 31, 2013 and share repurchases may be made from time to time in the open market or in negotiated transactions depending on share price, market conditions and other factors.

As previously announced, on December 31, 2012, the company completed the sale of certain real estate that had been leased to a franchisee. The company realized net cash proceeds of approximately $30 million and received a 24-month note of approximately $9 million as a result of the sale. In conjunction with the transaction, the company announced it will use $20 million of the $30 million cash proceeds to pay down debt on January 22, 2013. This will result in a reduction in interest expense of approximately $700 thousand during fiscal year 2013, partially offset by a charge of approximately $500 thousand to write-off the pro-rata portion of debt origination costs in the second quarter of fiscal 2013. The prepayment will be made at par, as allowed under the terms of the company’s notes.

“Effective use of cash is an important part of our multi-layered growth strategy. We believe the use of proceeds from the sale of real estate to reduce our leverage, as well as the Board’s decision to increase our share repurchase authorization, will maximize shareholder value,” said Cliff Hudson, Chairman and Chief Executive Officer. “The share repurchase program and debt reduction, combined with strategic initiatives to sustain positive same-store sales, expand operating margins and spur new drive-in development, provide the momentum needed to effect solid growth in our earnings in the near term and long term.”

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,042.90 -28.32 -0.17%
S&P 500 1,972.29 -5.51 -0.28%
NASDAQ 4,493.39 -12.4620 -0.28%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs