Wendy's/Arby's earns $14.7 million in 3Q
CHICAGO -- Fewer customers gulped down Arby's roast beef sandwiches at the third quarter, as more and more fast-food diners stayed home because of the recession, Wendy's/Arby's Group Inc. said Thursday.
Sales in locations open at least a year, an important performance measure, slid 9 percent at Arby's during the period. But executives said they hoped a new focus on $5 combo meals and a $1 menu the chain plans to expand to new markets will shore up results at the restaurant in the future.
Wendy's and its cheaper menu fared better than its higher-priced sibling, with flat sales in sites open at least a year.
"We are developing more effective value strategies at each brand during this very challenging economic climate," CEO Roland Smith said in a statement.
Fast-food restaurants were among the early winners of the recession as diners swapped price restaurants for the cheaper eateries. But now, customers are spending less, or staying home entirely. That dragged down business at the nation's fast food chains by 3 percent this summer, according to a recent report from a market research firm NPD Group.
Meanwhile, Wendy's/Arby's, which operates nearly 10,000 locations, said it's eyeing the potential for international development. Executives said it could eventually open more than 8,000 more locations outside North America.
For the three months that ended Sept. 27, Wendy's/Arby's earned $14.7 million, or 3 cents per share. That figure included a 3 cents per share charge related to last year's merger. Revenue was $903.2 million.
The company was formed last September when Arby's owner Triarc Cos. Inc. bought Wendy's in an all-stock deal valued at $2.34 billion.
Because of the merger, it's difficult to compare third quarter results to the same figures last year.
Analysts expected the restaurant company, based in Atlanta, to earn 6 cents per share on revenue of $916.5 million.
Its shares rose 19 cents, or 4.6 percent, to $4.35 in pre-market trading Thursday. Shares closed Wednesday at $4.16.