000216 Wendy's Fourth-Quarter Net Quadruples

Dublin, OH - Wendy's International Inc., the world's #3 hamburger chain, posted fourth-quarter earnings that beat analysts' estimates and showed strong sales leading to nearly fourfold growth in net income.

For the 1999 fourth-quarter, the Dublin, Ohio-based company reported earnings of $41 million, or 33 cents per diluted share, on revenues of $534 million. That compared with a profit of $11 million, or 9 cents per share, in the year-earlier quarter, when revenues totaled $478 million.

Analysts were expecting Wendy's, which has more than 5,500 restaurants worldwide, to earn 32 cents per share, according to data compiled by market research firm First Call/Thomson Financial.

Excluding a one-time charge, Wendy's earned 28 cents per share in the 1998 fourth-quarter, signifying an 18% rise in earnings per share for this year's fourth-quarter.

“Our fourth quarter performance was better than expected due primarily to sales growth, margin expansion and good control of corporate and store-level costs,” Frederick Reed, Wendy's chief financial officer, said in a statement.

Wendy's said sales at its U.S. stores open more than a year grew by 6.4% in the fourth quarter, adding that same-store sales at its Tim Hortons restaurants in Canada rose by 6.6%.

The company said it plans to add about 520 stores to its system this year and boost same-store sales by 3.5 to 4%.

For the full year 1999, Wendy's posted net income of $167 million, or $1.32 per diluted share, on revenues of $2.07 billion. That compared with a profit of $123 million, or 95 cents per share, in 1998, when revenues came in at $1.95 billion.

Wendy's, which opened 482 new restaurants in 1999, said its board declared a quarterly dividend of 6 cents per share payable on March 7 to holders of record as of Feb. 22.

The company added that its goal for earnings per share growth continues to be 12 to 15% and said it has used $413 million to buy back 17.2 million shares since it launched a repurchase program early in 1998. Wendy's noted that it has authorized a total of $600 million for buying back its shares.

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