
Dunkin' Brands Finally Brews up a Good Quarter
Updates from 7:48 a.m. ET with details from earnings call.
America may be running on Dunkin' again.
Dunkin' Donuts, a division of Dunkin' Brands (DNKN) - Get Report , reported Thursday that same-store sales in the U.S. rose 2% in the first-quarter, spurred by strength in more expensive espresso beverages and limited-time breakfast foods such as a new breakfast burrito. Dunkin' also said it removed discounted combo meals, which helped to propel sales and profit. Traffic to Dunkin's restaurants increased in the quarter along with a gain in the average amount spent per customer.
Meanwhile, Baskin-Robbins saw a 5% same-store sales increase in the U.S. as it likely benefited from people ordering cakes online and eating more ice cream during a warmer-than-average winter.
The comeback quarter for the Dunkin' brand in the U.S. comes as it ratcheted up its discounts on coffee to compete with a resurgentMcDonald's (MCD) - Get Report , which is seeing strong sales for its all-day breakfast platform, and moves to introduce new products more quickly.
Dunkin' surprisingly saw sales decline 0.8% in the fourth quarter last year. At the time, the results marked the second straight disappointing quarter in the U.S. for the donut and coffee chain, causing shares of Dunkin Brands to lose about 10.4% over the last year compared to a 1.2% drop for the S&P 500.
Strength at Dunkin' in the U.S., where it operates over 8,500 restaurants, helped the company deliver better-than-expected first-quarter earnings of 44 cents a share compared to estimates for 43 cents a share. The company reiterated that it expects U.S. same-store sales at Dunkin' Donuts to range from unchanged to an increase of 2% for the year. For ice cream chain Baskin Robbins, the company still sees U.S. same-store sales growth of 1% to 3%.
For the full year, Dunkin reaffirmed its earnings range of $2.20 to $2.22 a share. The company announced that it will expand its new mobile ordering technology to metro New York, and will start testing curbside pickup later this year.









