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Krispy Kreme Reports Financial Results For The Fourth Quarter And Fiscal Year Ended February 3, 2013

Krispy Kreme Reports Financial Results For The Fourth Quarter And Fiscal Year
                            Ended February 3, 2013

Raises Fiscal 2014 Guidance

PR Newswire

WINSTON-SALEM, N.C., March 14, 2013

WINSTON-SALEM, N.C., March 14, 2013 /PRNewswire/ -- Krispy Kreme Doughnuts,
Inc. (NYSE: KKD) (the "Company") today reported financial results for the
fourth quarter and fiscal year ended February 3, 2013, and raised its guidance
for fiscal 2014.

Fiscal Year

The fourth quarter and fiscal year ended February 3, 2013 included 14 and 53
weeks, respectively, compared to 13 and 52 weeks, respectively, for the fourth
quarter and fiscal year ended January 29, 2012. Accordingly, financial
results for the fiscal 2013 periods are not directly comparable to those of
the corresponding fiscal 2012 periods. The Company's fiscal year ends on the
Sunday closest to January 31, which periodically results in a 53-week year.

Fourth Quarter Fiscal 2013 Highlights Compared to the Year-Ago Period (Tables
1 and 2):

  oRevenues increased 15.9% to $118.1 million from $102.0 million
  oOperating income rose 60% to $8.5 million from $5.3 million
  oAdjusted net income increased 85% to $7.4 million ($0.11 per share) from
    $4.0 million ($0.06 per share); adjusted net income and adjusted EPS
    reflect income tax expense only to the extent currently payable in cash;
    adjusted net income and adjusted EPS are non-GAAP measures (see the
    reconciliation ofall adjusted earnings measures to the related GAAP
    amounts in Table 6 accompanying this release)
  oNet income was $4.8 million ($0.07 per share) compared to $143.5 million
    ($2.01 per share) in the fourth quarter last year; net income for the
    fourth quarter of last year included an unusual credit of $139.6 million
    ($1.95 per share) from the reversal of valuation allowances on deferred
    income tax assets
  oCash provided by operating activities was $21.3 million compared to $10.9
    million in the fourth quarter last year

To facilitate comparisons, the following highlights compare the 13 weeks ended
January 27, 2013 to the 13 weeks ended January 29, 2012:

  oRevenues increased 7.0% to $109.1 million from $102.0 million
  oCompany same store sales rose 7.5%, the seventeenth consecutive quarterly
    increase
  oOperating income increased 35% to $7.2 million from $5.3 million
  oAdjusted net income rose 53% to $6.1 million ($0.09 per share) from $4.0
    million ($0.06 per share)

Fiscal 2013 Highlights Compared to Fiscal 2012 (Tables 1 and 3):

  oRevenues increased 8.1% to $435.8 million from $403.2 million
  oOperating income rose 48% to $37.7 million from $25.6 million
  oAdjusted net income increased 54% to $34.2 million ($0.49 per share) from
    $22.2 million ($0.31 per share); adjusted net income and adjusted EPS
    reflect income tax expense only to the extent currently payable in cash
    and, in fiscal 2012, exclude the gain on the Company's sale of its 30%
    equity interest in KK Mexico
  oNet income was $20.8 million ($0.30 per share) compared to $166.3 million
    ($2.33 per share) last year; net income in fiscal 2012 included an unusual
    credit of $139.6 million ($1.95 per share) from the reversal of valuation
    allowances on deferred income tax assets and a $4.7 million after tax gain
    ($0.06 per share) on the Company's sale of its 30% equity interest in KK
    Mexico
  oCash provided by operating activities was $59.3 million compared to $33.9
    million in fiscal 2012

To facilitate comparisons, the following highlights compare the 52 weeks ended
January 27, 2013 to the 52 weeks ended January 29, 2012:

  oRevenues increased 5.9% to $426.8 million from $403.2 million
  oCompany same store sales rose 5.5%
  oOperating income increased 43% to $36.4 million from $25.6 million
  oAdjusted net income rose 49% to $32.9 million ($0.47 per share) from $22.2
    million ($0.31 per share)

James H. Morgan, Chairman and Chief Executive Officer, commented: "In the
fourth quarter, Krispy Kreme not only achieved earnings at the top end of our
November guidance, but also posted its best fourth quarter results since
fiscal 2004. The year as a whole also was our best since fiscal 2004, and
demonstrated again the strength of our business model and affirmed our
confidence in achieving our goal of sustainable and profitable growth for
years to come. Going forward, the Krispy Kreme investment thesis will no
longer be predicated solely on the progress we have made in building a strong
foundation for our business, but also on our ability to execute our long-term
growth plans. Based upon the strength of these results and the momentum we
have carried into the new year, we are pleased to increase our fiscal 2014
earnings guidance.

"Krispy Kreme is truly blessed with four attributes most companies spend a
lifetime trying to achieve: a brand that is beloved worldwide, best-in-class
products, compelling strategies, and incredibly capable and energized
franchisees and team members. We are committed to doing everything in our
power to continue improving our profitability while expanding our system to
1,300 stores by fiscal 2017 through Company and domestic and international
franchise development. We are gratified by our accomplishments and are
optimistic that we can build on them to achieve our long-term aspirations, and
those of our shareholders."

Results For the 13 Weeks Ended January 27, 2013 (Tables 2 and 8)

To facilitate comparisons, the following discussion compares the 13 weeks
ended January 27, 2013 with the 13 weeks ended January 29, 2012.

Consolidated Results

For the 13 weeks ended January 27, 2013, revenues increased 7.0% to $109.1
million. All four business segments reported year-over-year revenue growth.

Direct operating expenses increased to $91.0 million from $87.9 million, but
as a percentage of total revenues, decreased to 83.4% from 86.2%. General and
administrative expenses increased to $8.4 million from $6.7 million in the
same period last year. General and administrative expenses in the fourth
quarter of last year included a non-recurring credit of approximately
$840,000. Excluding that item, general and administrative expenses were 7.7%
of revenues compared to7.4% last year.

Operating income rose 35% to $7.2 million from $5.3 million.

Adjusted net income was $6.1 million ($0.09 per share) compared to $4.0
million ($0.06 per share), in the fourth quarter last year. Adjusted net
income and EPS are non-GAAP measures (see the reconciliation of GAAP to
adjusted earnings in Table 6 accompanying this release).

Segment Results

For the 13 weeks ended January 27, 2013, Company Stores revenues increased
9.6% to $75.2 million. Same store sales at Company stores rose 7.5%, the
seventeenth consecutive quarterly increase, driven by higher traffic. The
Company Stores segment posted operating income of $3.0 million compared to an
operating loss of $0.3 million last year.

Domestic Franchise revenues increased 4.2% to $2.5 million. Higher royalties
from an 8.3% increase in sales by domestic franchisees were partially offset
by a reduction in other franchise revenue. Same store sales rose 9.6% at
domestic franchise stores. During the quarter, we added new personnel and
took additional steps to begin execution of our domestic franchiseexpansion
programs. Domestic Franchise segment operating income was $1.3 million in the
fourth quarter of both years.

International Franchise revenues increased 6.3% to $6.7 million. Adjusted to
eliminate the effects of changes in foreign exchange rates, same store sales
at international franchise stores fell 7.4%, reflecting, among other things,
honeymoon effects from the substantial number of international store openings
in recent years, as well as cannibalization as markets develop. International
Franchise costs and expenses in the quarter included an increase of almost
$200,000 compared to the prior year quarter in trademark protection costs, a
provision of approximately $185,000 for potential uncollectible accounts and
higher personnel and personnel-related costs to support continued and
anticipated international growth. The International Franchise segment
generated operating income of $4.0 million compared to $4.2 million in the
fourth quarter last year.

Total KK Supply Chain revenues (including sales to Company stores) increased
1.8% to $52.9 million. KK Supply Chain generated operating income of $7.5
million compared to $7.1 million in the fourth quarter last year.

Fiscal 2014 Outlook

In fiscal 2014, management estimates that the Company and its domestic
franchisees will each open approximately 10 Krispy Kreme shops, and that
international franchisees will open approximately 75 locations. Although the
Company looks for continued organic same store sales growth in its domestic
stores, international franchise same store sales will likely remain pressured
by the substantial growth in international markets in recent years.

Based on these factors, management currently expects fiscal 2014 operating
income in the range of $41 million to $44 million, which would represent an
increase of13% to 21% from the $36.4 million operating income for fiscal 2013
measured on a 52-week basis. Management estimates adjusted net income will be
in the range of $37 million to $40 million and adjusted EPS will range from
$0.53 to $0.57 per share based on a forecasted 70 million diluted shares
outstanding.

Adjusted net income and adjusted EPS are non-GAAP measures; see the
reconciliation of GAAP to adjusted earnings in Table 6 accompanying this
release.

Conference Call

The Company will host a conference call to review fiscal 2013 fourth quarter
and annual results, as well as management's outlook for fiscal 2014, this
afternoon at 4:30 p.m. (ET). A live webcast of the conference call will be
available at www.krispykreme.com. The conference call also can be accessed
over the phone by dialing (800) 901-5217 or, for international callers, by
dialing (617) 786-2964. An archived replay of the call will be available
shortly after its conclusion by dialing (888) 286-8010, or (617) 801-6888 for
international callers; the passcode is 17091755. The audio replay will be
available through March 21, 2013. A transcript of the conference call also
will be available on the Company's website.

About Krispy Kreme

Krispy Kreme is a leading branded specialty retailer and wholesaler of premium
quality sweet treats and complementary products, including its signature
Original Glazed^® doughnut. Headquartered in Winston-Salem, N.C., the Company
has offered the highest quality doughnuts and great tasting coffee since it
was founded in 1937. Today, Krispy Kreme shops can be found in over 740
locations in 22 countries around the world. Connect with Krispy Kreme at
KrispyKreme.com and on Facebook, Foursquare, Twitter and YouTube.

Defined Terms

"Honeymoon effect" means the common pattern for many start-up restaurants in
which a flurry of activity due to start-up publicity and natural curiosity is
followed by a decline during which a steady repeat customer base develops.
"Cannibalization" means the tendency for new stores to become successful, in
part or in whole, by "shifting" sales from existing stores in the same
market.

Information contained in this press release, other than historical
information, should be considered forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on management's beliefs, assumptions and
expectations of our future economic performance, considering the information
currently available to management. These statements are not statements of
historical fact. Forward-looking statements involve risks and uncertainties
that may cause our actual results, performance or financial condition to
differ materially from the expectations of future results, performance or
financial condition we express or imply in any forward-looking statements.
The words "believe," "may," "could," "will," "should," "would," "anticipate,"
"estimate," "expect," "intend," "objective," "seek," "strive" or similar
words, or the negative of these words, identify forward-looking statements.
Factors that could contribute to these differences include, but are not
limited to: the quality of Company and franchise store operations; our
ability, and our dependence on the ability of our franchisees, to execute on
our and their business plans; our relationships with our franchisees; our
ability to implement our international growth strategy; our ability to
implement our domestic small shop operating model; political, economic,
currency and other risks associated with our international operations; the
price and availability of raw materials needed to produce doughnut mixes and
other ingredients, and the price of motor fuel; our relationships with
wholesale customers; our ability to protect our trademarks and trade secrets;
changes in customer preferences and perceptions; risks associated with
competition; risks related to the food service industry, including food safety
and protection of personal information; compliance with government regulations
relating to food products and franchising; and increased costs or other
effects of new government regulations relating to healthcare benefits. These
and other risks and uncertainties, which are described in more detail in the
Company's most recent Annual Report on Form 10-K and other reports and
statements filed with the United States Securities and Exchange Commission,
are difficult to predict, involve uncertainties that may materially affect
actual results and may be beyond the Company's control, and could cause actual
results and developments to be materially different from those expressed or
implied by any of these forward-looking statements. New factors emerge from
time to time, and it is not possible for management to predict all such
factors or to assess the impact of each such factor on the Company. Any
forward-looking statement speaks only as of the date on which such statement
is made, and the Company does not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after the date on
which such statement is made.

TABLE 1
KRISPY KREME DOUGHNUTS, INC
CONSOLIDATED STATEMENT OF INCOME
                            14 Weeks     13 Weeks     53 Weeks     52 Weeks
                            Ended        Ended        Ended        Ended
                            February 3,  January 29,  February 3,  January 29,
                            2013         2012         2013         2012
                            (In thousands, except per share amounts)
Revenues                    $  118,145   $ 101,957    $  435,843   $ 403,217
Operating expenses:
 Direct operating expenses
 (exclusive of depreciation
 and
      amortization expense     98,260      87,880        362,828     346,434
      shown below)
 General and administrative    8,778       6,673         25,089      22,188
 expenses
 Depreciation and              2,653       2,002         9,891       8,235
 amortization expense
 Impairment charges and        4           113           306         793
 lease termination costs
Operating income              8,450       5,289         37,729      25,567
Interest income               12          35            114         166
Interest expense              (440)       (390)         (1,642)     (1,666)
Equity in losses of equity     (52)        (53)          (202)       (122)
method franchisees
Gain on sale of interest in    -           -             -           6,198
equity method franchisee
Other non-operating income     80          (46)          317         215
and (expense), net
Income before income taxes    8,050       4,835         36,316      30,358
Provision for income taxes    3,270       (138,707)     15,537      (135,911)
Net income                  $  4,780     $ 143,542    $  20,779    $ 166,269
Earnings per common share:
 Basic                     $  0.07      $ 2.06       $  0.31      $ 2.40
 Diluted                  $  0.07      $ 2.01       $  0.30      $ 2.33
Weighted average shares
outstanding:
 Basic                        66,864      69,542        67,624      69,145
 Diluted                     69,520      71,567        69,896      71,497



TABLE 2
KRISPY KREME DOUGHNUTS, INC
CONSOLIDATED STATEMENT OF ADJUSTED INCOME - 13 WEEK BASIS
                           14 Weeks      Less - Week  13 Weeks     13 Weeks
                           Ended                      Ended        Ended
                                         Ended
                           February 3,   February 3,  January 27,  January 29,
                           2013          2013         2013         2012
                           (In thousands, except per share amounts)
Revenues                   $   118,145   $  (9,023)   $  109,122   $  101,957
Operating expenses:
   Direct operating
   expenses (exclusive of
   depreciation and
        amortization
        expense shown          98,260       (7,213)      91,047       87,880
        below)
   General and
   administrative              8,778        (331)        8,447        6,673
   expenses
   Depreciation and            2,653        (189)        2,464        2,002
   amortization expense
   Impairment charges and
   lease termination           4            -            4            113
   costs
Operating income              8,450        (1,290)      7,160        5,289
Interest income               12           -            12           35
Interest expense              (440)        12           (428)        (390)
Equity in losses of equity     (52)         -            (52)         (53)
method franchisees
Other non-operating income     80           -            80           (46)
and (expense), net
Income before income           8,050        (1,278)      6,772        4,835
taxes
Provision for current          681          (5)          676          855
income taxes
                                         
Adjusted net income        $   7,369        (1,273)   $  6,096     $  3,980
                                         $
Adjusted earnings per
common share:
   Basic                  $   0.11                   $  0.09      $  0.06
   Diluted               $   0.11                   $  0.09      $  0.06
Weighted average shares
outstanding:
   Basic                      66,864                    66,864       69,542
   Diluted                   69,520                    69,520       71,567
Note: The fourth quarter of fiscal 2013 contained 14 weeks compared to 13
weeks in the fourth quarter of fiscal 2012. The foregoing table presents
fourth quarter fiscal 2013 results exclusive of results for the 14th week in
order to facilitate comparison of fourth quarter fiscal 2013 results with
results for the fourth quarter of fiscal 2012.
Adjusted net income and adjusted EPS are non-GAAP measures. See the
reconciliation of GAAP to adjusted earnings in Table 6.

TABLE 3
KRISPY KREME DOUGHNUTS, INC
CONSOLIDATED STATEMENT OF ADJUSTED INCOME - 52 WEEK BASIS
                          53 Weeks       Less - Week  52 Weeks     52 Weeks
                          Ended                       Ended        Ended
                                         Ended
                          February 3,    February 3,  January 27,  January 29,
                          2013           2013         2013         2012
                          (In thousands, except per share amounts)
Revenues                  $   435,843    $  (9,023)   $  426,820   $  403,217
Operating expenses:
   Direct operating
   expenses (exclusive of
   depreciation and
        amortization
        expense shown         362,828       (7,213)      355,615      346,434
        below)
   General and
   administrative             25,089        (331)        24,758       22,188
   expenses
   Depreciation and           9,891         (189)        9,702        8,235
   amortization expense
   Impairment charges and
   lease termination          306           -            306          793
   costs
Operating income             37,729        (1,290)      36,439       25,567
Interest income              114           -            114          166
Interest expense             (1,642)       12           (1,630)      (1,666)
Equity in losses of
equity method                 (202)         -            (202)        (122)
franchisees
Other non-operating
income and (expense),         317           -            317          215
net
Income before income          36,316        (1,278)      35,038       24,160
taxes
Provision for current         2,124         (5)          2,119        2,000
income taxes
Adjusted net income       $   34,192     $  (1,273)   $  32,919    $  22,160
Adjusted earnings per
common share:
   Basic                 $   0.51                    $  0.49      $  0.32
   Diluted              $   0.49                    $  0.47      $  0.31
Weighted average shares
outstanding:
   Basic                     67,624                     67,624       69,145
   Diluted                  69,896                     69,896       71,497
Note: Fiscal 2013 contained 53 weeks compared to 52 weeks in fiscal 2012.
The foregoing table presents fiscal 2013 results exclusive of results for the
53rd week in order to facilitate comparison of fiscal 2013 results with
results for fiscal 2012.
Adjusted net income and adjusted EPS are non-GAAP measures. See the
reconciliation of GAAP to adjusted earnings in Table 6.

TABLE 4
KRISPY KREME DOUGHNUTS, INC.
CONSOLIDATED BALANCE SHEET
                                                      February 3,  January 29,
                                                      2013         2012
                                                      (In thousands)
    ASSETS
CURRENT ASSETS:
Cash and cash equivalents                            $ 66,332     $ 44,319
Receivables                                            22,037       21,616
Receivables from equity method                          705          655
franchisees 
Inventories                                            15,948       16,497
Deferred income taxes                                   23,323       10,540
Other current assets                                   6,439        3,613
   Total current assets                                134,784      97,240
Property and equipment                                 78,024       75,466
Investments in equity method franchisees               -            -
Goodwill and other intangible assets                   24,195       23,776
Deferred income taxes                                   93,088       129,053
Other assets                                           11,847       9,413
   Total assets                                      $ 341,938    $ 334,948
    LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt                 $ 2,148      $ 2,224
Accounts payable                                       12,198       10,494
Accrued liabilities                                    32,330       28,800
   Total current liabilities                           46,676       41,518
Long-term debt, less current maturities                23,595       25,369
Other long-term obligations                            25,235       18,935
Commitments and contingencies
SHAREHOLDERS' EQUITY:
Preferred stock, no par value                          -            -
Common stock, no par value                             354,068      377,539
Accumulated other comprehensive loss                   (338)        (336)
Accumulated deficit                                    (107,298)    (128,077)
   Total shareholders' equity                          246,432      249,126
     Total liabilities and shareholders' equity       $ 341,938    $ 334,948

TABLE 5
KRISPY KREME DOUGHNUTS, INC
CONSOLIDATED STATEMENT OF CASH FLOWS
                                                53 Weeks Ended  52 Weeks Ended
                                                February 3,     January 29,
                                                2013            2012
                                                    (In thousands)
CASH FLOW FROM OPERATING ACTIVITIES:
Net income                                      $   20,779      $   166,269
Adjustments to reconcile net income to net cash
provided by operating activities:
 Depreciation and amortization expense           9,891           8,235
 Deferred income taxes                           13,413          (139,403)
 Impairment charges                              -               60
 Accrued rent expense                            585             465
 Loss on disposal of property and equipment      543             414
 Gain on sale of interest in equity method       -               (6,198)
franchisee
 Share-based compensation                        6,801           6,699
 Provision for doubtful accounts                 194             (374)
 Amortization of deferred financing costs        398             422
 Equity in losses of equity method               202             122
franchisees
 Other                                           (219)           676
Change in assets and liabilities:
 Receivables                                     (509)           (862)
 Inventories                                     560             (1,862)
 Other current and non-current assets            (1,012)         462
 Accounts payable and accrued liabilities        4,740           (168)
 Other long-term obligations                     2,944           (1,096)
 Net cash provided by operating              59,310          33,861
activities
CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of property and equipment                  (14,218)        (11,884)
Proceeds from disposals of property and             178             44
equipment
Acquisition of stores from franchisee               (915)           -
Proceeds from sale of interest in equity method     -               7,723
franchisee
Escrow deposit recovery                             -               1,800
Other investing activities                          517             (207)
 Net cash used for investing activities      (14,438)        (2,524)
CASH FLOW FROM FINANCING ACTIVITIES:
Repayment of long-term debt                         (2,346)         (8,991)
Deferred financing costs                            (11)            (29)
Proceeds from exercise of stock options             247             1,036
Proceeds from exercise of warrants                  9               -
Repurchase of common shares                         (20,758)        (1,004)
 Net cash used for financing activities      (22,859)        (8,988)
Net increase in cash and cash equivalents           22,013          22,349
Cash and cash equivalents at beginning of year      44,319          21,970
Cash and cash equivalents at end of year        $   66,332      $   44,319
Supplemental schedule of non-cash investing and
financing activities:
 Assets acquired under capital leases        $   516         $   1,197





TABLE 6

KRISPY KREME DOUGHNUTS, INC.

NON-GAAP FINANCIAL INFORMATION

The Company has net deferred income tax assets of approximately $116 million,
of which approximately $76 million relates to federal and state net operating
loss carryovers. The Company's federal net operating loss carryovers total
approximately $206 million.

In the quarter ended January 29, 2012, the Company reversed approximately
$139.6 million of valuation allowances against its deferred income tax assets
because management concluded that realization of such assets was more likely
than not. While such reversal, which was required by GAAP, increased the
Company's earnings by $139.6 million in fiscal 2012, the reversal has the
effect of reducing the Company's earnings beginning in fiscal 2013 as a result
of an increase in the provision for income taxes. This negative effect on
earnings beginning in fiscal 2013 occurs because the reversal of the valuation
allowance resulted in the recognition in fiscal 2012 of income tax benefits
expected to be realized in later years; absent the reversal of the valuation
allowance, any such tax benefits would have been recognized when realized in
future periods upon the generation of taxable income. Accordingly, beginning
in fiscal 2013, the Company's effective income tax rate, which in fiscal 2012
and earlier years bore little or no relationship to pretax income, more
closely reflects the blended federal and state income tax rates in
jurisdictions in which the Company operates.

Because of the increase in the Company's effective income tax rate resulting
from the reversal of a valuation allowance, the Company's income tax expense
in fiscal 2013 is not comparable to income tax expense in fiscal 2012 and
earlier years. In addition, until such time as the Company's net operating
loss carryovers are exhausted or expire, GAAP income tax expense is expected
to substantially exceed the amount of cash income taxes payable by the
Company.

In the second quarter of fiscal 2012, the Company realized a pretax gain of
$6.2 million ($4.7 million after tax, or $.06 per share) on the sale of its
30% ownership interest in KK Mexico, an equity method investee. The Company
does not expect to realize similar gains in the future.

The Company's fiscal year ends on the Sunday closest to January 31, which
periodically results in a 14-week fourth quarter and a 53-week year. Fiscal
2013 contained 53 weeks, while fiscal 2012 contained 52 weeks.

The following non-GAAP financial information and related reconciliation to
GAAP measures are provided to assist the reader in understanding the effects
of the above transactions and events, which, except for the periodic
occurrence of the 53-week year, are expected to be non-recurring, on the
Company's results of operations, and to facilitate comparison of fiscal 2013
results with the Company's financial results for fiscal 2012. In addition,
the non-GAAP financial information is intended to illustrate the material
difference between the Company's income tax expense and income taxes currently
payable. These non-GAAP performance measures are consistent with other
measurements made by management in the operation of the business which do not
consider income taxes except to the extent to which those taxes currently are
payable, for example, capital allocation decisions and incentive compensation
measurements that are made on a pretax basis.



             Management's        Historical Periods
             Earnings Guidance   Three Months Ended      Year Ended
             Year Ending         February   January 29,  February   January 29,
             February 2, 2014    3,                      3,
             From      To        2013       2012         2013       2012
             (In thousands, except per share amounts)
Net income,  $ 22,000  $ 23,700  $ 4,780    $ 143,542    $ 20,779   $ 166,269
as reported
Provision
for deferred   15,000    16,300    2,589      (139,562)    13,413     (139,403)
income taxes
Gain on sale
of interest
in KK Mexico
 (net of
income taxes   -         -         -          -            -          (4,706)
of $1,492)
Adjusted net $ 37,000  $ 40,000    7,369      3,980        34,192     22,160
income
Earnings for
the                                (1,273)    -            (1,273)    -
14th/53rd
week
Adjusted net
income -                         $ 6,096    $ 3,980      $ 32,919   $ 22,160
13/52 week
basis
Adjusted
earnings per
common
share:
 Basic   $ 0.55    $ 0.60    $ 0.11     $ 0.06       $ 0.51     $ 0.32
 Diluted $ 0.53    $ 0.57    $ 0.11     $ 0.06       $ 0.49     $ 0.31
Adjusted
earnings per
common share
-
 13/52
week basis:
 Basic                       $ 0.09     $ 0.06       $ 0.49     $ 0.32
 Diluted                     $ 0.09     $ 0.06       $ 0.47     $ 0.31
Weighted
average
shares
outstanding:
 Basic     67,000    67,000    66,864     69,542       67,624     69,145
 Diluted   70,000    70,000    69,520     71,567       69,896     71,497





TABLE 7
KRISPY KREME DOUGHNUTS, INC
SEGMENT INFORMATION
                            14 Weeks     13 Weeks     53 Weeks     52 Weeks
                            Ended        Ended        Ended        Ended
                            February 3,  January 29,  February 3,  January 29,
                            2013         2012         2013         2012
                            (In thousands)
Revenues:
 Company Stores:
   On-premises sales        $  40,430    $  32,852    $ 142,918    $ 126,003
   Wholesale sales             40,892       35,732      153,576      145,654
           Company Stores      81,322       68,584      296,494      271,657
           revenues
 Domestic Franchise           2,764        2,418       10,325       9,463
 International Franchise      7,109        6,259       24,941       22,621
 KK Supply Chain:
   Total revenues             57,337       51,952      215,412      206,453
   Less – intersegment         (30,387)     (27,256)    (111,329)    (106,977)
   sales elimination
        External KK Supply    26,950       24,696      104,083      99,476
        Chain revenues
           Total revenues  $  118,145   $  101,957   $ 435,843    $ 403,217
Operating income (loss):
 Company Stores            $  3,263     $  (267)     $ 8,534      $ 284
 Domestic Franchise           1,518        1,260       5,590        3,737
 International Franchise      4,430        4,161       17,387       15,054
 KK Supply Chain              8,269        7,086       32,450       30,160
   Total segment operating     17,480       12,240      63,961       49,235
   income
 Unallocated general and       (9,026)      (6,838)     (25,926)     (22,875)
 administrative expenses
 Impairment charges and        (4)          (113)       (306)        (793)
 lease termination costs
   Consolidated operating   $  8,450     $  5,289     $ 37,729     $ 25,567
   income
Depreciation and
amortization expense:
 Company Stores            $  2,221     $  1,611     $ 8,142      $ 6,593
 Domestic Franchise           14           54          164          219
 International Franchise      1            2           10           6
 KK Supply Chain              169          170         738          730
 Corporate administration     248          165         837          687
   Total depreciation and   $  2,653     $  2,002     $ 9,891      $ 8,235
   amortization expense





TABLE 8
KRISPY KREME DOUGHNUTS, INC
SEGMENT INFORMATION - 13 WEEK BASIS
                            14 Weeks     Less - Week  13 Weeks     13 Weeks
                            Ended                     Ended        Ended
                                         Ended
                            February 3,  February 3,  January 27,  January 29,
                            2013         2013         2013         2012
                            (In thousands)
Revenues:
   Company Stores:
      On-premises sales     $  40,430    $  (3,120)   $  37,310    $  32,852
      Wholesale sales          40,892       (3,047)      37,845       35,732
               Company
               Stores          81,322       (6,167)      75,155       68,584
               revenues
   Domestic Franchise         2,764        (244)        2,520        2,418
   International Franchise    7,109        (457)        6,652        6,259
   KK Supply Chain:
      Total revenues          57,337       (4,438)      52,899       51,952
      Less – intersegment      (30,387)     2,283        (28,104)     (27,256)
      sales elimination
          External KK
          Supply Chain         26,950       (2,155)      24,795       24,696
          revenues
               Total        $  118,145   $  (9,023)   $  109,122   $  101,957
               revenues
Operating income (loss):
   Company Stores          $  3,263     $  (280)     $  2,983     $  (267)
   Domestic Franchise         1,518        (218)        1,300        1,260
   International Franchise    4,430        (395)        4,035        4,161
   KK Supply Chain            8,269        (747)        7,522        7,086
      Total segment            17,480       (1,640)      15,840       12,240
      operating income
   Unallocated general and     (9,026)      350          (8,676)      (6,838)
   administrative expenses
   Impairment charges and      (4)          -            (4)          (113)
   lease termination costs
      Consolidated          $  8,450     $  (1,290)   $  7,160     $  5,289
      operating income
Depreciation and
amortization expense:
   Company Stores          $  2,221     $  (158)     $  2,063     $  1,611
   Domestic Franchise         14           -            14           54
   International Franchise    1            -            1            2
   KK Supply Chain            169          (12)         157          170
   Corporate                   248          (19)         229          165
   administration
      Total depreciation
      and amortization      $  2,653     $  (189)     $  2,464     $  2,002
      expense
Note: The fourth quarter of fiscal 2013 contained 14 weeks compared to 13
weeks in the fourth quarter of fiscal 2012. The foregoing table presents
fourth quarter fiscal 2013 results exclusive of results for the 14th week in
order to facilitate comparison of fourth quarter fiscal 2013 results with
results for the fourth quarter of fiscal 2012.





TABLE 9
KRISPY KREME DOUGHNUTS, INC
SEGMENT INFORMATION - 52 WEEK BASIS
                            53 Weeks     Less - Week  52 Weeks     52 Weeks
                            Ended                     Ended        Ended
                                         Ended
                            February 3,  February 3,  January 27,  January 29,
                            2013         2013         2013         2012
                            (In thousands)
Revenues:
   Company Stores:
      On-premises sales     $ 142,918    $  (3,120)   $ 139,798    $ 126,003
      Wholesale sales         153,576       (3,047)     150,529      145,654
               Company
               Stores         296,494       (6,167)     290,327      271,657
               revenues
   Domestic Franchise        10,325        (244)       10,081       9,463
   International Franchise   24,941        (457)       24,484       22,621
   KK Supply Chain:
      Total revenues         215,412       (4,438)     210,974      206,453
      Less – intersegment     (111,329)     2,283       (109,046)    (106,977)
      sales elimination
          External KK
          Supply Chain        104,083       (2,155)     101,928      99,476
          revenues
               Total        $ 435,843    $  (9,023)   $ 426,820    $ 403,217
               revenues
Operating income (loss):
   Company Stores          $ 8,534      $  (280)     $ 8,254      $ 284
   Domestic Franchise        5,590         (218)       5,372        3,737
   International Franchise   17,387        (395)       16,992       15,054
   KK Supply Chain           32,450        (747)       31,703       30,160
      Total segment           63,961        (1,640)     62,321       49,235
      operating income
   Unallocated general and    (25,926)      350         (25,576)     (22,875)
   administrative expenses
   Impairment charges and     (306)         -           (306)        (793)
   lease termination costs
      Consolidated          $ 37,729     $  (1,290)   $ 36,439     $ 25,567
      operating income
Depreciation and
amortization expense:
   Company Stores          $ 8,142      $  (158)     $ 7,984      $ 6,593
   Domestic Franchise        164           -           164          219
   International Franchise   10            -           10           6
   KK Supply Chain           738           (12)        726          730
   Corporate                  837           (19)        818          687
   administration
      Total depreciation
      and amortization      $ 9,891      $  (189)     $ 9,702      $ 8,235
      expense
Note: Fiscal 2013 contained 53 weeks compared to 52 weeks in fiscal 2012.
The foregoing table presents fiscal 2013 results exclusive of results for the
53rd week in order to facilitate comparison of fiscal 2013 results with
results for fiscal 2012.



TABLE 10
KRISPY KREME DOUGHNUTS, INC
SELECTED OPERATING STATISTICS
                           13 Weeks Ended             52 Weeks Ended
                           January 27,   January 29,  January 27,  January 29,
                           2013          2012         2013         2012
Systemwide sales (in
thousands):^(1)
     Company stores        $  74,680     $ 68,047     $ 288,079    $ 269,676
     Domestic Franchise       70,880       65,477       281,334      261,979
     stores
     International            112,525      104,320      423,418      383,508
     Franchise stores
     International
     Franchise stores, in     112,525      104,972      423,418      380,028
     constant dollars^(2)
Change in same store
sales:^(3)
     Company stores           7.5     %    8.3     %    5.5     %    5.2     %
     Domestic Franchise       9.6          7.9          6.8          6.6
     stores^
     International            (7.3)        (8.8)        (9.0)        (6.4)
     Franchise stores^
     International
     Franchise stores, in     (7.4)        (9.5)        (8.1)        (10.8)
     constant dollars^(2)
Company Stores - change
in same store sales:
     Retail pricing           0.0     %    8.4     %    0.7     %    7.4     %
     Guest check average
     (exclusive of the        (2.9)        (4.1)        (1.4)        (2.9)
     effects of pricing)
     Customer count           10.6         3.2          6.2          0.5
     Other                    (0.2)        0.8          0.0          0.2
      Total                7.5     %    8.3     %    5.5     %    5.2     %
Change in same store
customer count - Company
stores (retail sales          11.9    %    3.6     %    7.1     %    0.6     %

only)
Average guest check -
Company stores (retail     $  7.19       $ 7.42       $ 7.29       $ 7.36
sales only)
Company Stores - store        1,260        1,175        4,891        4,567
operating weeks
Company stores wholesale
sales:^(4)
     Grocers/mass
     merchants:^
      Change in
     average weekly           (3.7)   %    (0.5)   %    (4.0)   %    2.6     %
     number of doors
      Change in
     average weekly           12.3         10.6         8.9          12.7
     sales per door
     Convenience
     stores:^
      Change in
     average weekly           (2.0)   %    (10.2)  %    (6.3)   %    (5.9)   %
     number of doors
      Change in
     average weekly           6.9          14.2         8.8          10.7
     sales per door
     Systemwide sales, a non-GAAP financial measure, include sales by both
     Company and franchise Krispy Kreme stores. The Company believes
     systemwide
     sales data are useful in assessing consumer demand for the Company's
     products, the overall success of the Krispy Kreme brand and, ultimately,
     the
     performance of the Company. All of the Company's royalty revenues are
     computed as percentages of sales made by the Company's domestic and
     international franchisees, and substantially all of KK Supply Chain's
     external sales of doughnut mixes and other ingredients ultimately are
(1)  determined by
     demand for the Company's products at franchise stores. Accordingly, sales
     by the Company's franchisees have a direct effect on the Company's
     royalty and
     KK Supply Chain revenues, and therefore on the Company's profitability.
     The Company's consolidated financial statements appearing elsewhere
     herein
     include sales by Company stores, sales to franchisees by the KK Supply
     Chain business segment, and royalties and fees received from franchise
     stores based
     on their sales, but exclude sales by franchise stores to their customers.
     Computed on a pro forma basis assuming the average rate of exchange
     between the U.S. dollar and each of the foreign currencies in which the
(2)  Company's
     international franchisees conduct business had been the same in the
     comparable prior year period.
     The change in "same store sales" represents the aggregate on-premises
     sales (including fundraising sales) during the current year period for
     all stores which
     had been open for more than 56 consecutive weeks during the current year
     period (but only to the extent such sales occurred in the 57^th or later
     week of each
     store's operation) divided by the aggregate on-premises sales of such
     stores for the comparable weeks in the preceding year period. Once a
     store has been
(3)  open for at least 57 consecutive weeks, its sales are included in the
     computation of same stores sales for all subsequent periods. In the event
     a store is closed
     temporarily (for example, for remodeling) and has no sales during one or
     more weeks, such store's sales for the comparable weeks during the
     earlier or
     subsequent period are excluded from the same store sales computation. The
     change in "same store customer count" is similarly computed, but is based
     upon
     the number of retail transactions reported in the Company's point-of-sale
     system.
     For Company wholesale sales, "average weekly number of doors" represents
     the average number of customer locations to which product deliveries are
(4)  made
     during a week by Company Stores, and "average weekly sales per door"
     represents the average weekly sales to each such location by Company
     Stores.





TABLE 11
KRISPY KREME DOUGHNUTS, INC
STORE COUNT
                                      NUMBER OF STORES
                                      DOMESTIC  INTERNATIONAL  TOTAL
Number of stores at February 3, 2013
Company:
      Factory                         76        -              76
      Satellite                       21        -              21
           Total Company              97        -              97
Franchise:
      Factory                         99        120            219
      Satellite                       43        389            432
           Total franchise            142       509            651
                Total systemwide      239       509            748
                                      NUMBER OF STORES
                                      COMPANY   FRANCHISE      TOTAL
Quarter ended February 3, 2013
October 28, 2012                      96        635            731
Opened                               2         31             33
Closed                               (1)       (15)           (16)
February 3, 2013                      97        651            748
Quarter ended January 29, 2012
October 30, 2011                      89        589            678
Opened                               3         26             29
Closed                               -         (13)           (13)
January 29, 2012                      92        602            694



SOURCE Krispy Kreme Doughnut Corporation

Website: http://www.krispykreme.com
Contact: Media: Brian K. Little, +1-336-726-8825, blittle@krispykreme.com, or
Investor Relations: Anita K. Booe, +1-336-703-6902, abooe@krispykreme.com