The Wendy’s Company Earnings: Swings Up, Topping Expectations

The Wendy’s Company (NYSE:WEN) reported its results for the fourth quarter. Wendy’s Arby’s Group is a quick service restaurant company, which is comprised of the Wendy’s and Arby’s brands.

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The Wendy’s Company Earnings Cheat Sheet for the Fourth Quarter

Results: Reported a profit of $4 million (one cent per diluted share) in the quarter. The Wendy’s Company had a net loss of $10.8 million or a loss 3 cents per share in the year-earlier quarter.

Revenue: Rose 5.6% to $615 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: The Wendy’s Company reported adjusted net income of 4 cents per share. By that measure, the company beat the mean estimate of 3 cents per share. Analysts were expecting revenue of $609.1 million.

Quoting Management: “Customer feedback on the 10 Image Activation restaurants we remodeled during 2011 has been very positive, and sales growth has exceeded our expectations,” said President and Chief Executive Officer Emil Brolick. “Based on these results, we are targeting a return on this remodeling investment of approximately 15 percent and intend to use our balance sheet and cash flow to fund the program. As we validate these returns, we will also begin to work with our franchisees to develop financing sources for this reimaging program.”

Key Stats:

The company beat estimates last quarter after being in line with expectations in the third quarter with net income of 4 cents per share.

After sitting in the red the quarter before, the company reported a profit last quarter. In the second quarter, the company booked a net loss of $11.3 million, or a loss of 3 cents per share.

Looking Forward: Over the past ninety days, the average estimate for the first quarter of the next fiscal year has fallen from 12 cents per share to 5 cents, indicating that analysts are growing pessisimistic about the company’s performance next quarter. For the fiscal year, the average estimate has moved down from 23 cents a share to 18 cents over the last ninety days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com