Donut and coffee chain and Baskin-Robbins ice cream owner Dunkin' Brands (DNKN) served up better-than-expected third-quarter earnings on Thursday strong demand for premium breakfast sandwiches and specialty coffees at its U.S.-based Dunkin' Donuts stores, though total sales fell short of analysts' forecasts.
The Canton, Mass.-based company posted adjusted earnings of $75.7 million, or 90 cents a share, vs. $69.9 million, or 83 cents a share, in the comparable year-ago quarter. Analysts polled by FactSet had been expecting per-share earnings of 81 cents.
Sales rang in at $355.9 million, up from $350 million a year ago though below analysts' forecasts of $359 million. Same-store sales within Dunkin' Donuts gained 1.5%, while same-store sales among Baskin-Robbins outlets grew 3.6%, the company said.
CEO David Hoffmann said Dunkin's U.S. performance was led by strength in premium beverages such as espresso and cold brew, along with sales of breakfast sandwiches. Additional features including a new digital loyalty program and mobile ordering also helped drive customer traffic, Hoffmann said.
The company also raised its per-share guidance for the fourth quarter to a range of between $3.10 and $3.12, up its previous guidance range of between $3.02 and $3.05. Analysts polled by FactSet are currently expecting full-year per-share earnings of $3.05. It also said it is now expecting ice cream margin dollars of approximately $16 million vs. its previous forecast of flat.
Separately, Dunkin' Brands said it board has agreed to a cash dividend of 37.5 cents a share, payable on Dec. 11, to shareholders of record as of the close of business on Dec. 2.