One day after signaling that it may be for sale,
posted a 10% drop in fourth-quarter earnings.
The Overland Park, Kan.-based company said Wednesday that it earned $18.5 million, or 25 cents a share, in the quarter, down from $20.5 million, or 27 cents a share, a year earlier.
Excluding an impairment charge, stock options expense and costs related to restaurant closures, the company earned $23.7 million, or 32 cents a share. The earnings got a boost of 5 cents a share from an extra week in the quarter.
Applebee's sales rose to $342 million from $300.2 million a year earlier.
Domestic comparable sales, or sales at stores open for at least a year, decreased 1.1%. Comp sales for company restaurants slid 1.4%, and domestic franchise restaurant comp sales fell 1%.
Analysts polled by Thomson Financial projected earnings of 23 cents a share on sales of $335.7 million.
On Tuesday, the company said it hired Citi and Banc of America Securities to help it
explore strategic alternatives, including a possible sale. Applebee's has been battered by disappointing sales, a sagging stock price and pressure from a minority shareholder agitating for change.
"While acknowledging a difficult macro environment for casual dining, all of our company restaurant and support center associates, as well as our valuable franchise partners, are focused on improving the things that are within our control," Dave Goebel, president and CEO, said in a statement Wednesday.
Goebel said the company plans to focus on driving guest traffic and volumes at existing restaurants, with less emphasis on new restaurant development.
"Our key strategic initiatives in 2007 include continued improvement of our food, evolution of our advertising, and a greater emphasis on communicating our value proposition to our guests," Goebel said.
For the full year, Applebee's earnings totaled $80.9 million, or $1.08 a share, down from of $101.8 million, or $1.27 a share, a year earlier. Revenue increased 10% to $1.34 billion.
Shares closed the regular session Wednesday at $26.84, up 52 cents, or 2%, tacking on to an 8.6% jump from Tuesday.