Krispy Kreme lifts guidance; Obamacare impact ahead

by Jeff Gelski
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WINSTON-SALEM, N.C. — Krispy Kreme Doughnuts, Inc. reported third-quarter gains in revenues and earnings and in response raised its fiscal outlook for 2013.

Net income of $5,044,000, equal to 8c per share on the common stock, in the quarter ended Oct. 28 compared with $4,717,000, or 7c per share, in the previous year’s third quarter. Net income and e.p.s. in this year’s third quarter reflect a book tax rate of 43% compared with a rate of 9% in the previous year’s third quarter. Adjusted net income of $8,344,000, or 13c per share, compared with adjusted net income of $4,748,000, or 7c per share, in the previous year’s third quarter.

Third-quarter revenues rose 9% to $107,087,000 from $98,708,000. Third-quarter operating income increased to $9,211,000 from $5,550,000. Same-store sales increased 6.8% at company stores and 5% at domestic franchises.

Krispy Kreme now expects consolidated operating income of between $34 million and $36 million in fiscal year 2013, which is up from a previous outlook of between $29 million and $33 million. The company forecasts adjusted e.p.s. of between 44c and 47c per share in fiscal 2013. The fourth quarter will have 14 weeks instead of 13 because fiscal year 2013 has 53 weeks.

Preliminary fiscal year 2014 guidance calls for operating income in the range of $38 million to $42 million and adjusted e.p.s. of between 49c and 54c per share. Krispy Kreme in fiscal year 2014 anticipates opening 5 to 10 company stores, 10 to 15 domestic franchise stores and more than 75 international franchise stores.
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