Sonic Q4 Profit Up 54%, Meets View; Revenues Beat Estimates

(RTTNews) - Sonic Corp. (SONC), the largest chain of drive-in restaurants in the U.S., on Tuesday reported a 54 percent increase in profit for the fourth quarter from last year, reflecting higher same-store sales and improved margins.

Adjusted earnings per share for the quarter matched analysts' expectations, while revenues beat their estimates.

Cliff Hudson, CEO,of Sonic Corp. said, "Our fourth quarter capped off a great year for Sonic, and we believe that the business is well positioned for continued growth. Our same-store sales growth over the past fiscal year reflects not only the success of our promotional strategy but also improvements in our core menu and base business."

Oklahoma City-based Sonic's net income for the fourth quarter was $18.83 million or $0.34 per share, up from $12.20 million or $0.21 per share in the same period last year.

Excluding items, adjusted net income for the quarter was $18.83 million or $0.34 per share, compared to $17.20 million or $0.30 per share in the prior year quarter.

On average, 17 analysts polled by Thomson Reuters expected the company to report earnings of $0.34 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter grew 3 percent to $163.77 million from $158.80 million in the year-ago period. Analysts had a consensus revenue estimate of $161.04 million for the quarter.

System-wide same-store sales for the quarter increased 4.6 percent, consisting of a 4.5 percent same-store sales increase at franchise drive-ins and an increase of 4.9 percent at company drive-ins.

Company drive-in margins improved by 150 basis points. During the quarter, 17 new drive-ins were opened.

For fiscal 2014, Sonic's net income increased to $47.92 million or $0.85 per share from $36.70 million or $0.64 per share in the prior year. Adjusted net income was $0.84 per share, compared to $0.72 per share last year.

Total revenues for the year grew 2 percent to $552.35 million from $542.59 million in the previous year.

Analysts expected the company to earn $0.83 per share for the year on revenues of $549.52 million.

Looking ahead to fiscal 2015, Sonic noted that while the macroeconomic environment may impact results, it now expects its initiatives to drive earnings per share growth of 18 percent to 20 percent compared to adjusted earnings per share in fiscal 2014.

Earlier, the company had said it expects fiscal 2015 earnings per share growth at the higher end of its long-term 14 to 15 percent growth target.

The company projects full-year positive same-store sales in the low single digit range for the system.

Street expects the company to earn $0.99 per share for the year on revenues of $579.53 million.

SONC closed Tuesday's trading at $23.57, down $0.15 or 0.63 percent on a volume of 1.45 million shares. However, in after-hours, the stock gained $0.83 or 3.52 percent to $24.40.