Net income for the Einstein Noah Restaurant Group, Inc. fell 4% to $12,741,000, equal to 75c per share on the common stock, in the year ended Jan. 1, down from $13,203,000, or 79c per share, in fiscal 2011.
Total revenues of $427,006,000 were up 0.8% from $423,595,000 in the year-ago period.
For the fourth quarter ended Jan. 1, net income was $3,167,000, or 19c per share, down 48% from $6,120,000, or 36c per share, in the same period a year ago. Total revenues for the quarter were $110,646,000, down 4% from $115,141,000.
“2012 was a strong year at Einstein Noah as we successfully executed on our key objectives and delivered strong financial results to our shareholders,” said Jeff O’Neill, president and chief executive officer. “We achieved record revenues, record adjusted EBITDA and record operating cash flow through a combination of positive comparable sales, unit development, and operational improvements. We also returned a substantial amount of capital through a one-time special dividend as well as our regular quarterly dividends, further demonstrating our long-term confidence in the business.
“Specific to the fourth quarter, we generated our highest comparable sales result of the year and seventh consecutive quarter of comparable store sales growth overall as our product and marketing initiatives resonated with customers. From a profitability standpoint, gross profit margins as a percentage of revenues improved reflecting the positive impact of our initiatives. All in all, we consider the fourth quarter a fine ending to a year in which we created and unlocked value for the benefit of all shareholders.”
In a Feb. 28 conference call with analysts, Mr. O’Neill said Einstein Noah heads into fiscal 2013 with a focus on its marketing mantra of “best at bagels, win at coffee, and compete at lunch.” He was particularly upbeat about the company’s new everyday value layer that recently was launched nationwide. The program features $3.99 and $5.99 combos, and it is expected to deliver strong trends in the lunchtime eating occasion.
“Based on the tests that we did last year, we feel confident that we are going to get our traffic moving in the right direction and get our lunch business growing as effectively as we have with our breakfast daypart,” Mr. O’Neill said.
The company also has a strong lineup of innovation, he said, including Big Eat sandwiches and specialty beverages.
“We’ve had good trends since we put in our coffee platform over a year ago,” he said. “And our specialty beverage remains a big priority for us to continue to build our mix strongly over the next few years.”
Einstein Noah plans to open 60 to 80 locations in fiscal 2012, including 15 to 20 company-owned restaurants, 15 to 20 franchise restaurants and 30 to 40 license restaurants. Capital expenditures for the full year are expected to range between $20 million to $22 million.
