“Qdoba same-store sales in the third quarter increased 0.5 percent for company restaurants and 1.3 percent system-wide, showing sequential improvement from our second quarter weather-impacted results,” Lang said.
Consolidated restaurant operating margin improved by 40 basis points to 17.9 percent of sales in the third quarter of 2013, compared with 17.5 percent of sales in the year-ago quarter.
Restaurant operating margin increased 110 basis points to 16.9 percent of sales for Jack in the Box. The improvement was due primarily to leverage from same-store sales increases and the benefit of refranchising, which was partially offset by higher food and packaging costs. The increase in food and packaging costs as a percentage of sales resulted from commodity inflation of approximately 3.0 percent which was partially offset by the benefit of price increases.
Restaurant operating margin decreased 270 basis points to 20.6% of sales for Qdoba, due primarily to sales deleverage as compared to last year, product mix changes, commodity inflation of approximately 1.9 percent and increased staffing levels.
SG&A expense for the third quarter was essentially flat as compared to the prior year quarter. The benefit of the company’s restructuring activities, lower advertising and overhead costs resulting from the Jack in the Box refranchising strategy, and decreases in pre-opening costs and incentive compensation were partially offset by higher share-based compensation and pension costs, and increased advertising at Qdoba.
The tax rate for the third quarter of 2013 was 37.4 percent versus 34.9 percent for the third quarter of 2012. The tax rate in the third quarter of fiscal 2013 was affected by discontinued operations relating to the Qdoba closures.
The company repurchased approximately 1,366,000 shares of its common stock in the third quarter at an average price of $37.20 per share for an aggregate cost of $50.8 million. Year-to-date through the third quarter, the company has repurchased approximately 2,773,000 shares at an average price of $33.24 per share for an aggregate cost of $92.2 million. This leaves $84.7 million remaining under a $100 million stock-buyback program authorized by the company’s board of directors that expires in November 2014. In August 2013, the company’s board of directors authorized an additional $100 million stock-buyback program that expires in November 2015.