Jack In The Box Q2 Profit Rises - Update

(RTTNews) - Jack in the Box Inc. (JACK) Wednesday reported an increase in profit for the second quarter, as lower costs and same-store sales growth offset a decline in revenue. Nonetheless, earnings for the quarter fell short of Wall Street estimates by a penny.

San Diego, California-based Jack in the Box's second-quarter profit rose to $15.8 million or $0.37 per share from $13.3 million or $0.29 per share last year. Operating earnings, which excludes one-time items, were $0.51 per share. On average, 14 analysts polled by Thomson Reuters expected earnings of $0.52 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the second quarter dropped to $340.9 million from $347.2 million last year. Jack in the Box operates namesake quick-service restaurants and Qdoba Mexican Grill fast-casual restaurants.

Twelve analysts had a consensus revenue estimate of $338.98 million for the quarter.

Chief Executive Lenny Comma said, "Overall, our second quarter results were solid, with a 38 percent increase in operating earnings per share resulting from better than expected same-store sales growth at Qdoba Mexican Grill, margin expansion and lower overhead, which overcame a shortfall in sales at Jack in the Box."

System wide same-store sales at Jack in the Box restaurants increased 0.7 percent in the quarter, while Qdoba Mexican restaurants improved 7.0 percent.

Consolidated restaurant operating margin increased by 140 basis points to 18.5 percent of sales for the quarter. SG&A expense for the second quarter decreased by $3.8 million and was 14.3 percent of revenues as compared to 15.1 percent last year.

Looking ahead to the fiscal year 2014, the company continues to expect operating earnings of $2.25 per share to $2.35 per share. Analysts currently expect full-year earnings of $2.35 per share.

For the third quarter, the company expects same-store sales to increase about 2.0 percent to 3.0 percent at Jack in the Box company restaurants, and 3.0 percent to 4.0 percent at Qdoba company restaurants.

The company separately said its Board has approved the initiation of a regular quarterly cash dividend of $0.20 per share, to be paid on June 9 to shareholders of record as of May 27.

JACK closed Wednesday's trading at $54.01, down $1.30 or 2.35%, on the Nasdaq. The stock further dropped $0.51 or 0.94% in after-hours trade.