reported fourth-quarter profits that fell 15% from a year ago as higher expenses ate away at the restaurant operator's bottom line.
The company earned $20.5 million, or 27 cents a share, compared with $24.4 million, or 30 cents a share, a year earlier. The most recent quarter includes an accounting change that cost $225,000, or less than 1 cent a share. Analysts surveyed by Thomson First Call were expecting earnings of 27 cents.
Revenue in the fourth quarter grew 10.7% from a year ago to $300.2 million from $271.2 million, but analysts were estimating $300.8 million.
The company expects to earn $1.43 a share to $1.47 a share, excluding the effect of stock-compensation expenses, in fiscal 2006. The Wall Street consensus estimate was for earnings of $1.30 a share. Applebee's systemwide same-store sales for the year are expected to increase 2% to 3%.
Systemwide comp sales for the fourth quarter increased 1%. Same-store sales for company restaurants declined 0.9%, and franchise restaurant comp sales increased 1.6%.
"Our key strategic initiatives in 2006 include more rapid innovation of our food, evolution of our advertising message, and leveraging our key points of differentiation with consumers," the company said. "While we were pleased with our strong January sales performance, we recognize that a four-week period is not long enough to declare a sustainable improvement in trends, and that our results do not yet reflect the implementation of those initiatives."
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