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Denny's Corporation Reports Results for Third Quarter 2013



Denny's Corporation Reports Results for Third Quarter 2013

          - Adjusted Net Income Per Share* Increased 5.1% to $0.08 -

   - Achieved Positive System-Wide Same-Store Sales in Nine of the Last Ten
                                  Quarters -

SPARTANBURG, S.C., Oct. 28, 2013 (GLOBE NEWSWIRE) -- Denny's Corporation
(Nasdaq:DENN), franchisor and operator of one of America's largest franchised
full-service restaurant chains, today reported results for its third quarter
ended September 25, 2013.

Third Quarter Summary

  * Domestic system-wide same-store sales increased 1.2%, comprised of a 1.3%
    increase at domestic franchised restaurants and a 0.7% increase at company
    restaurants.
     
  * Opened nine new franchised restaurants including one non-traditional
    location at Wright State University and three international locations
    including Denny's first restaurants in Chile and El Salvador.
     
  * Net Income increased by 31.1% to $7.0 million, or $0.08 per diluted share,
    compared with the prior year quarter Net Income of $5.4 million, or $0.06
    per diluted share.
     
  * Adjusted Net Income per Share* of $0.08 increased 5.1% compared with the
    prior year quarter Adjusted Net Income per Share* of $0.07. Adjusted Net
    Income* excludes debt refinancing charges, impairment charges and gains on
    sales of assets and other. Please see the tables in the Appendix for a
    reconciliation of Adjusted Net Income*.
     
  * Generated $11.6 million of Free Cash Flow* primarily used to repurchase
    1.8 million shares.

John Miller, President and Chief Executive Officer, stated, "We achieved our
ninth quarter of positive system-wide same-store sales in the past ten
quarters, as our focus on delivering both everyday value and new product
offerings is continuing to resonate with the consumer.  This approach has
enabled us to grow sales despite the challenging economic environment. In
addition, the ongoing and successful expansion of Denny's global footprint was
marked by our recent openings, bringing our total number of international
locations to 100. We continue to focus on successfully executing against our
key objectives which include growing sales through our 'America's Diner'
positioning, increasing the growth of the Denny's brand domestically and
internationally, and growing profitability and Free Cash Flow* through our
franchise-focused business." 

Third Quarter Results

For the third quarter of 2013, franchise and license revenue was $33.9 million
compared with $34.4 million in the prior year quarter.  The 1.4% decrease in
franchise and license revenue was primarily due to decreases in both occupancy
revenue and initial fees. The decrease was partially offset by a $0.4 million
increase in royalties from nine additional equivalent franchised
restaurants. Company restaurant sales were $83.4 million due to 12 fewer
equivalent company restaurants, which reflects the impact of selling company
restaurants to franchisees as part of the Company's refranchising strategy
that was completed at the end of 2012.

Denny's opened nine new franchised restaurants in the third quarter of this
year and closed 13 franchised restaurants bringing the total restaurant count
to 1,686. In addition, the Company sold two company restaurants to a
franchisee and acquired one franchised restaurant bringing the total company
restaurant count to 164 and total franchised restaurant count to 1,522.

Franchise operating margin of $22.3 million was approximately equal to the
prior year.  Franchise operating margin (as a percentage of franchise and
license revenue) of 65.8% increased 0.9 percentage points primarily due to an
increase in the royalty and licensing margin.

Company restaurant operating margin was $10.3 million, or 12.3% of company
restaurant sales, down from 14.7% in the third quarter of 2012.  The 2.4
percentage point decrease was primarily driven by increases in product costs,
payroll and benefits costs and other operating costs. The increase in payroll
and benefits costs included $0.2 million, or 0.3 percentage points, of
unfavorable workers' compensation claims development compared to the prior
year quarter. This increase was driven by $1.5 million of unfavorable workers'
compensation claims development in the current quarter and $1.3 million of
unfavorable workers' compensation claims development in the third quarter of
2012.

Total general and administrative expenses improved by $1.0 million to $13.7
million in the quarter.  Net operating gains, losses and other charges, which
include restructuring charges, exit costs, impairment charges and gains or
losses on the sale of assets, totaled $0.2 million in the quarter.

Interest expense decreased $0.6 million to $2.5 million as a result of a $21.2
million reduction in total debt over the last 12 months and lower interest
rates under the Company's refinanced credit facility. In the third quarter,
the provision for income taxes was $4.3 million, reflecting an effective tax
rate of 38.0%. Due to the use of net operating loss and tax credit
carryforwards, the Company only paid $0.5 million in cash taxes in the third
quarter.

Denny's third quarter net income of $7.0 million, or $0.08 per diluted share,
grew 31.1% compared to prior year quarter net income of $5.4 million, or $0.06
per diluted share. Adjusted Net Income* of $7.0 million, or $0.08 per diluted
share, was flat to prior year Adjusted Net Income* of $7.0 million, or $0.07
per diluted share, in the prior year quarter.

Denny's generated $11.6 million of Free Cash Flow* in the third quarter, a
portion of which was used to repurchase 1,781,040 shares for $10.2
million. Since initiating its share repurchase strategy in November 2010, the
Company has used $69.2 million to repurchase 15.3 million shares through
September 25, 2013. As of September 25, 2013, the Company had 9.7 million
shares remaining in its current authorized share repurchase initiative. In
addition, Denny's ended the third quarter with $175.3 million of total debt
outstanding including $97.0 million of borrowings under the revolving line of
credit and $58.5 million of term loan debt outstanding.

Business Outlook

Mark Wolfinger, Executive Vice President, Chief Administrative Officer and
Chief Financial Officer, commented, "In the third quarter, the Free Cash Flow*
we generated after capital investments demonstrates the strength of our
franchise-focused business.  Our team's execution, together with a balanced
capital allocation strategy, continues to provide us with the ability to
reinvest in the brand and return value to shareholders through our share
repurchase program."

Based on year-to-date results and management's expectations at this time,
Denny's is updating its expectations for certain elements (New Restaurant
Openings, Net Restaurant Growth and Total G&A) of its estimates for full year
2013. 

  * Domestic system-wide same-store sales growth between 0% and 1%.
     
  * New restaurant openings at the lower end of initial guidance range of 40
    to 45 franchised restaurants with net restaurant growth between 0 and 5
    restaurants.
     
  * Total G&A, including share-based compensation, between $57 million and $59
    million.
     
  * Adjusted EBITDA* at the lower end of initial guidance range of $76 million
    to $80 million.
     
  * Cash capital expenditures between $20 million and $22 million, including
    approximately 20 remodels at company restaurants and the acquisition of
    two franchised restaurants and two parcels of real estate for a total of
    approximately $4.0 million.
     
  * Depreciation and amortization between $20.5 million and $21.5 million.
     
  * Net interest expense between $9.5 million and $10.5 million with net cash
    interest expense between $8.0 million and $9.0 million.
     
  * Cash taxes between $2.5 million and $3.5 million with income tax rate
    between 34% and 36%.
     
  * Free Cash Flow* between $43 million and $46 million.

*  Please refer to the historical reconciliation of net income to Adjusted Net
Income, Adjusted Net Income Per Share, Adjusted EBITDA and Free Cash Flow
included in the tables below.

Conference Call and Webcast Information

Denny's will provide further commentary on the results for the third quarter
2013 on its quarterly investor conference call today, Monday, October 28, 2013
at 4:30 p.m. ET.  Interested parties are invited to listen to a live broadcast
of the conference call accessible through the investor relations section of
Denny's website at investor.dennys.com.  A replay of the call may be accessed
at the same location later in the day and will remain available for 30 days.

About Denny's

Denny's is the franchisor and operator of one of America's largest franchised
full-service restaurant chains, based on number of restaurants.  Denny's
currently has 1,686 franchised, licensed, and company restaurants around the
world with combined sales of $2.5 billion including 1,586 restaurants in the
United States and 100 restaurants in Canada, Costa Rica, Mexico, Honduras,
Guam, Curaçao, Puerto Rico, Dominican Republic, El Salvador, Chile and New
Zealand.  As of September 25, 2013, 1,522 of Denny's restaurants were
franchised and 164 restaurants were company operated. For further information
on Denny's, including news releases, links to SEC filings and other financial
information, please visit the Denny's investor relations website at
investor.dennys.com.

The Company urges caution in considering its current trends and any outlook on
earnings disclosed in this press release.  In addition, certain matters
discussed in this release may constitute forward-looking statements.  These
forward-looking statements, which reflect its best judgment based on factors
currently known, are intended to speak only as of the date such statements are
made and involve risks, uncertainties, and other factors that may cause the
actual performance of Denny's Corporation, its subsidiaries and underlying
restaurants to be materially different from the performance indicated or
implied by such statements.  Words such as "expects", "anticipates",
"believes", "intends", "plans", "hopes", and variations of such words and
similar expressions are intended to identify such forward-looking
statements.  Except as may be required by law, the Company expressly disclaims
any obligation to update these forward-looking statements to reflect events or
circumstances after the date of this release or to reflect the occurrence of
unanticipated events.  Factors that could cause actual performance to differ
materially from the performance indicated by these forward-looking statements
include, among others:  the competitive pressures from within the restaurant
industry; the level of success of the Company's strategic and operating
initiatives, advertising and promotional efforts; adverse publicity; changes
in business strategy or development plans; terms and availability of capital;
regional weather conditions; overall changes in the general economy,
particularly at the retail level; political environment (including acts of war
and terrorism); and other factors from time to time set forth in the Company's
SEC reports and other filings, including but not limited to the discussion in
Management's Discussion and Analysis and the risks identified in Item 1A. Risk
Factors contained in the Company's Annual Report on Form 10-K for the year
ended December 26, 2012 (and in the Company's subsequent quarterly reports on
Form 10-Q).

DENNY'S CORPORATION
Condensed Consolidated Balance Sheets
(Unaudited)
                                                               
(In thousands)                                     9/25/2013  12/26/2012
Assets                                                         
Current assets                                                 
Cash and cash equivalents                           $ 6,330    $ 13,565
Receivables                                        14,167     19,947
Current deferred tax asset                         20,962     19,807
Other current assets                               9,001      11,291
Total current assets                               50,460     64,610
Property, net                                      105,174    107,004
Goodwill                                           31,451     31,430
Intangible assets, net                             48,479     48,920
Noncurrent deferred tax asset                      34,829     45,776
Other noncurrent assets                            29,516     27,145
Total assets                                        $ 299,909  $ 324,885
                                                               
Liabilities                                                    
Current liabilities                                            
Current maturities of long-term debt                $ 3,000    $ 8,500
Current maturities of capital lease obligations    4,170      4,181
Accounts payable                                   17,009     24,461
Other current liabilities                          50,228     54,682
Total current liabilities                          74,407     91,824
Long-term liabilities                                          
Long-term debt, less current maturities            152,500    161,500
Capital lease obligations, less current maturities 15,666     15,953
Other                                              56,951     60,068
Total long-term liabilities                        225,117    237,521
Total liabilities                                  299,524    329,345
                                                               
Shareholders' equity                                           
Common stock                                       1,047      1,038
Paid-in capital                                    566,369    562,657
Deficit                                            (475,208)  (495,518)
Accumulated other comprehensive loss, net of tax   (22,607)   (24,999)
Treasury stock                                     (69,216)   (47,638)
Total shareholders' equity (deficit)               385        (4,460)
Total liabilities and shareholders' equity          $ 299,909  $ 324,885
                                                               
Debt Balances
(In thousands)                                     9/25/2013  12/26/2012
Credit facility term loan and revolver due 2018     $ 155,500 $ — 
Credit facility term loan due 2017                 —          170,000
Capital leases                                     19,836     20,134
Total debt                                          $ 175,336  $ 190,134

 
 
DENNY'S CORPORATION
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
                                                            
                                                 Quarter Ended
(In thousands, except per share amounts)         9/25/2013 9/26/2012
Revenue:                                                    
Company restaurant sales                         $ 83,371  $ 86,575
Franchise and license revenue                    33,904    34,370
Total operating revenue                          117,275   120,945
Costs of company restaurant sales                73,088    73,808
Costs of franchise and license revenue           11,599    12,078
General and administrative expenses              13,704    14,702
Depreciation and amortization                    5,198     5,287
Operating (gains), losses and other charges, net 161       3,380
Total operating costs and expenses               103,750   109,255
Operating income                                 13,525    11,690
Interest expense, net                            2,452     3,088
Other nonoperating (income) expense, net         (276)     38
Net income before income taxes                   11,349    8,564
Provision for income taxes                       4,318     3,201
Net income                                       $ 7,031   $ 5,363
                                                            
Basic net income per share                       $ 0.08    $ 0.06
Diluted net income per share                     $ 0.08    $ 0.06
                                                            
Basic weighted average shares outstanding        90,035    94,705
Diluted weighted average shares outstanding      91,967    96,745
                                                            
Comprehensive income                             $ 6,574   $ 5,631
                                                            
General and Administrative Expenses              Quarter Ended
(In thousands)                                   9/25/2013 9/26/2012
Share-based compensation                         $ 1,053   $ 1,128
Other general and administrative expenses        12,651    13,574
Total general and administrative expenses        $ 13,704  $ 14,702

 
 
DENNY'S CORPORATION
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
                                                             
                                                 Three Quarters Ended
(In thousands, except per share amounts)         9/25/2013  9/26/2012
Revenue:                                                     
Company restaurant sales                          $ 247,242  $ 271,977
Franchise and license revenue                    101,094    100,437
Total operating revenue                          348,336    372,414
Costs of company restaurant sales                213,659    231,506
Costs of franchise and license revenue           34,586     34,776
General and administrative expenses              42,948     45,150
Depreciation and amortization                    15,774     17,174
Operating (gains), losses and other charges, net 1,779      (794)
Total operating costs and expenses, net          308,746    327,812
Operating income                                 39,590     44,602
Interest expense, net                            7,800      10,537
Other nonoperating expense, net                  1,056      7,941
Net income before income taxes                   30,734     26,124
Provision for income taxes                       10,424     10,295
Net income                                        $ 20,310   $ 15,829
                                                             
                                                             
Basic net income per share                        $ 0.22     $ 0.17
Diluted net income per share                      $ 0.22     $ 0.16
                                                             
Basic weighted average shares outstanding        91,348     95,472
Diluted weighted average shares outstanding      93,377     97,196
                                                             
Comprehensive income                              $ 22,702   $ 16,633
                                                             
General and Administrative Expenses              Three Quarters Ended
(In thousands)                                   9/25/2013  9/26/2012
Share-based compensation                          $ 3,434    $ 2,794
Other general and administrative expenses        39,514     42,356
Total general and administrative expenses         $ 42,948   $ 45,150

 
 
DENNY'S CORPORATION
Income, EBITDA, Free Cash Flow, and Net Income Reconciliations
(Unaudited)
                                                                   
Income, EBITDA and Free   Quarter Ended             Three Quarters Ended
Cash Flow Reconciliation
(In thousands)            9/25/2013    9/26/2012    9/25/2013     9/26/2012
Net income                 $ 7,031      $ 5,363      $ 20,310      $ 15,829
Provision for income      4,318        3,201        10,424        10,295
taxes
Operating (gains), losses 161          3,380        1,779         (794)
and other charges, net
Other nonoperating        (276)        38           1,056         7,941
expense, net
Share-based compensation  1,053        1,128        3,434         2,794
Adjusted Income Before     $ 12,287     $ 13,110     $ 37,003      $ 36,065
Taxes ^(1)
                                                                   
Interest expense, net     2,452        3,088        7,800         10,537
Depreciation and          5,198        5,287        15,774        17,174
amortization
Cash payments for
restructuring charges and (771)        (1,521)      (2,168)       (2,845)
exit costs
Cash payments for         —            (294)        (900)         (649)
share-based compensation
Adjusted EBITDA ^(1)       $ 19,166     $ 19,670     $ 57,509      $ 60,282
                                                                   
Cash interest expense,    (2,156)      (2,719)      (6,890)       (9,048)
net
Cash paid for income      (496)        (500)        (1,831)       (1,865)
taxes, net
Cash paid for capital     (4,897)      (3,567)      (13,441)      (7,846)
expenditures
Free Cash Flow ^(1)        $ 11,617     $ 12,884     $ 35,347      $ 41,523
                                                                   
Net Income Reconciliation Quarter Ended             Three Quarters Ended
(In thousands)            9/25/2013    9/26/2012    9/25/2013     9/26/2012
Net income                 $ 7,031      $ 5,363      $ 20,310      $ 15,829
Gains on sales of assets  (68)         91           (83)          (6,772)
and other, net
Impairment charges        —            2,468        857           3,008
Loss on debt refinancing  —            2            1,187         7,925
Tax effect ^(2)           23           (932)        (665)         (1,515)
Adjusted Net Income ^(1)   $ 6,986      $ 6,992      $ 21,606      $ 18,475
                                                                   
Diluted weighted-average  91,967       96,745       93,377        97,196
shares outstanding
                                                                   
Adjusted Net Income Per    $ 0.08       $ 0.07       $ 0.23        $ 0.19
Share ^(1)
                                                                   
(1)  The Company believes that, in addition to other financial measures,
Adjusted Income Before Taxes, Adjusted EBITDA, Free Cash Flow, Adjusted Net
Income and Adjusted Net Income Per Share are appropriate indicators to assist
in the evaluation of its operating performance on a period-to-period
basis. The Company also uses Adjusted Income, Adjusted EBITDA and Free Cash
Flow internally as performance measures for planning purposes, including the
preparation of annual operating budgets, and for compensation purposes,
including bonuses for certain employees. Adjusted EBITDA is also used to
evaluate its ability to service debt because the excluded charges do not have
an impact on its prospective debt servicing capability and these adjustments
are contemplated in its credit facility for the computation of its debt
covenant ratios. Free Cash Flow, defined as Adjusted EBITDA less cash portion
of interest expense net of interest income, capital expenditures, and cash
taxes, is used to evaluate operating effectiveness and decisions regarding the
allocation of resources. However, Adjusted Income, Adjusted EBITDA, Free Cash
Flow, Adjusted Net Income and Adjusted Net Income Per Share should be
considered as a supplement to, not a substitute for, operating income, net
income or other financial performance measures prepared in accordance with
U.S. generally accepted accounting principles.
(2)  Tax adjustments for the three and nine months ended September 25, 2013
are calculated using the Company's year-to-date effective tax rate of
33.9%. Tax adjustments for the three and nine months ended September 26, 2012
are calculated using the Company's full year 2012 effective tax rate of 36.4%.

 
 
DENNY'S CORPORATION
Operating Margins
(Unaudited)
                                                                     
                           Quarter Ended
(In thousands)             9/25/2013                  9/26/2012
Company restaurant                                                   
operations: ^(1)
Company restaurant sales    $ 83,371       100.0%      $ 86,575      100.0%
Costs of company                                                     
restaurant sales:
Product costs              21,722          26.1%      21,449         24.8%
Payroll and benefits       33,746          40.5%      34,409         39.7%
Occupancy                  5,598           6.7%       5,780          6.7%
Other operating costs:                                               
Utilities                  3,592           4.3%       3,760          4.3%
Repairs and maintenance    1,550           1.9%       1,578          1.8%
Marketing                  3,116           3.7%       3,213          3.7%
Legal settlements          157             0.2%       197            0.2%
Other                      3,607           4.3%       3,422          4.0%
Total costs of company      $ 73,088       87.7%       $ 73,808      85.3%
restaurant sales
Company restaurant          $ 10,283       12.3%       $ 12,767      14.7%
operating margin ^(2)
                                                                     
Franchise operations: ^(3)                                           
Franchise and license                                                
revenue:
Royalties                   $ 21,777       64.2%       $ 21,333      62.1%
Initial fees               434             1.3%       728            2.1%
Occupancy revenue          11,693          34.5%      12,309         35.8%
Total franchise and         $ 33,904       100.0%      $ 34,370      100.0%
license revenue
                                                                     
Costs of franchise and                                               
license revenue:
Occupancy costs             $ 8,616        25.4%       $ 9,027       26.2%
Other direct costs         2,983           8.8%       3,051          8.9%
Total costs of franchise    $ 11,599       34.2%       $ 12,078      35.1%
and license revenue
Franchise operating margin  $ 22,305       65.8%       $ 22,292      64.9%
^(2)
                                                                     
Total operating revenue     $ 117,275      100.0%      $ 120,945     100.0%
^(4)
Total costs of operating   84,687          72.2%      85,886         71.0%
revenue ^(4)
Total operating margin      $ 32,588       27.8%       $ 35,059      29.0%
^(4)(2)
                                                                     
Other operating expenses:                                            
^(4)(2)
General and administrative  $ 13,704       11.7%       $ 14,702      12.2%
expenses
Depreciation and           5,198           4.4%       5,287          4.4%
amortization
Operating gains, losses    161             0.1%       3,380          2.8%
and other charges, net
Total other operating       $ 19,063       16.3%       $ 23,369      19.3%
expenses
                                                                     
Operating income ^(4)       $ 13,525       11.5%       $ 11,690      9.7%
                                                                     
(1)  As a percentage of company restaurant sales
(2)  Other operating expenses such as general and administrative expenses and
depreciation and amortization relate to both company and franchise operations
and are not allocated to costs of company restaurant sales and costs of
franchise and license revenue. As such, operating margin is considered a
non-GAAP financial measure. Operating margins should be considered as a
supplement to, not as a substitute for, operating income, net income or other
financial measures prepared in accordance with U.S. generally accepted
accounting principles.
(3)  As a percentage of franchise and license revenue
(4)  As a percentage of total operating revenue
                                                                     
                                                                     
DENNY'S CORPORATION
Operating Margins
(Unaudited)
                                                                     
                           Three Quarters Ended
(In thousands)             9/25/2013                  9/26/2012
Company restaurant                                                   
operations: ^(1)
Company restaurant sales    $ 247,242      100.0%      $ 271,977     100.0%
Costs of company                                                     
restaurant sales:
Product costs              64,270          26.0%      67,684         24.9%
Payroll and benefits       98,512          39.8%      108,779        40.0%
Occupancy                  16,339          6.6%       17,776         6.5%
Other operating costs:                                               
Utilities                  9,897           4.0%       11,066         4.1%
Repairs and maintenance    4,423           1.8%       4,901          1.8%
Marketing                  9,245           3.7%       10,138         3.7%
Legal settlements          671             0.3%       366            0.1%
Other                      10,302          4.2%       10,796         4.0%
Total costs of company      $ 213,659      86.4%       $ 231,506     85.1%
restaurant sales
Company restaurant          $ 33,583       13.6%       $ 40,471      14.9%
operating margin ^(2)
                                                                     
 Franchise operations:                                               
^(3)
Franchise and license                                                
revenue:
Royalties                   $ 64,205       63.5%       $ 62,734      62.5%
Initial fees               1,164           1.2%       2,167          2.2%
Occupancy revenue          35,725          35.3%      35,536         35.3%
Total franchise and         $ 101,094      100.0%      $ 100,437     100.0%
license revenue
                                                                     
Costs of franchise and                                               
license revenue:
Occupancy costs             $ 26,235       25.9%       $ 26,455      26.3%
Other direct costs         8,351           8.3%       8,321          8.3%
Total costs of franchise    $ 34,586       34.2%       $ 34,776      34.6%
and license revenue
Franchise operating margin  $ 66,508       65.8%       $ 65,661      65.4%
^(2)
                                                                     
Total operating revenue     $ 348,336      100.0%      $ 372,414     100.0%
^(4)
Total costs of operating   248,245         71.3%      266,282        71.5%
revenue ^(4)
Total operating margin      $ 100,091      28.7%       $ 106,132     28.5%
^(4)(2)
                                                                     
Other operating expenses:                                            
^(4)(2)
General and administrative  $ 42,948       12.3%       $ 45,150      12.1%
expenses
Depreciation and           15,774          4.5%       17,174         4.6%
amortization
Operating gains, losses    1,779           0.5%       (794)          (0.2)%
and other charges, net
Total other operating       $ 60,501       17.4%       $ 61,530      16.5%
expenses
                                                                     
Operating income ^(4)       $ 39,590       11.4%       $ 44,602      12.0%
                                                                     
(1)  As a percentage of company restaurant sales
(2)  Other operating expenses such as general and administrative expenses and
depreciation and amortization relate to both company and franchise operations
and are not allocated to costs of company restaurant sales and costs of
franchise and license revenue. As such, operating margin is considered a
non-GAAP financial measure. Operating margins should be considered as a
supplement to, not as a substitute for, operating income, net income or other
financial measures prepared in accordance with U.S. generally accepted
accounting principles.
(3)  As a percentage of franchise and license revenue
(4)  As a percentage of total operating revenue

 
 
DENNY'S CORPORATION
Statistical Data
(Unaudited)
                                                                      
Same-Store Sales                   Quarter Ended          Three Quarters Ended
(increase/(decrease) vs. prior     9/25/2013 9/26/2012    9/25/2013  9/26/2012
year)
Company Restaurants                 0.7%      (0.5)%       (0.4)%     0.1%
Domestic Franchised Restaurants     1.3%      0.7%         0.5%       1.6%
Domestic System-wide Restaurants    1.2%      0.5%         0.4%       1.4%
System-wide Restaurants             1.0%      0.4%         0.3%       1.1%
                                                                      
Average Unit Sales                 Quarter Ended          Three Quarters Ended
(In thousands)                     9/25/2013 9/26/2012    9/25/2013  9/26/2012
Company Restaurants                 $ 510     $ 493        $ 1,509    $ 1,447
Franchised Restaurants              $ 365     $ 358        $ 1,073    $ 1,061
                                                                      
Restaurant Unit Activity           Company   Franchised   Total       
                                             & Licensed
Ending Units 6/26/13               165       1,525        1,690       
Units Opened                       0         9            9           
Units Reacquired                   1         (1)          0           
Units Refranchised                 (2)       2            0           
Units Closed                       0         (13)         (13)        
 Net Change                        (1)       (3)          (4)         
Ending Units 9/25/13               164       1,522        1,686       
                                                                      
Equivalent Units                                                      
Third Quarter 2013                 163       1,520        1,683       
Third Quarter 2012                 175       1,511        1,686       
                                   (12)      9            (3)         
                                                                      
Restaurant Unit Activity           Company   Franchised & Total       
                                             Licensed
Ending Units 12/26/12              164       1,524        1,688       
Units Opened                       0         27           27          
Units Reacquired                   2         (2)          0           
Units Refranchised                 (2)       2            0           
Units Closed                       0         (29)         (29)        
Net Change                         0         (2)          (2)         
Ending Units 9/25/13               164       1,522        1,686       
                                                                      
Equivalent Units                                                      
Year-to-Date 2013                  164       1,524        1,688       
Year-to-Date 2012                  188       1,495        1,683       
                                   (24)      29           5           

CONTACT: Investor Contact:
         Whit Kincaid
         877-784-7167
        
         Media Contact:
         Liz DiTrapano, ICR
         646-277-1226

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