Denny’s(US:DENN)2024-10-22 11:03Financial Performance - Total operating revenue for Q3 2024 was $111.8 million, a decrease from $114.2 million in the prior year quarter[3] - Operating income for Q3 2024 was $11.7 million, down from $14.0 million in the prior year quarter[3] - Net income was reported at $6.5 million, or $0.12 per diluted share, with adjusted net income at $7.2 million, or $0.14 per share[3] - Total operating revenue for the quarter ended 9/25/24 was $111,759,000, a decrease of 2.3% from $114,183,000 for the quarter ended 9/27/23[18] - Net income for the quarter ended 9/25/24 was $6,516,000, a decrease of 17.6% compared to $7,908,000 for the quarter ended 9/27/23[18] - Comprehensive income for the three quarters ended 9/25/24 was $12,989,000, a decrease of 59.5% compared to $31,980,000 for the same period last year[20] - Adjusted EBITDA for the three quarters ended September 25, 2024, was $58,739,000, down 13.5% from $68,235,000 for the same period in 2023[23] Sales and Revenue Trends - Denny's domestic system-wide same-restaurant sales decreased by 0.1% compared to the same period in 2023, with a decline of 0.4% at company restaurants[3] - Company restaurant sales decreased to $52,701,000 for the quarter ended 9/25/24, down from $53,153,000 for the same quarter last year, representing a decline of 0.8%[18] - Franchise and license revenue for the quarter ended 9/25/24 was $59,058,000, a decrease of 3.2% from $61,030,000 for the quarter ended 9/27/23[18] - Franchise and license revenue totaled $178,269 million, a decrease from $187,083 million year-over-year, with royalties contributing $88,421 million (49.6%) and advertising revenue $59,098 million (33.2%)[31] - Company restaurant sales were $159,391 million, down from $161,486 million, with product costs at $40,554 million (25.4%) and payroll and benefits at $60,805 million (38.1%)[32] Expenses and Costs - Adjusted EBITDA is expected to be between $81 million and $84 million for the full year 2024[8] - General and administrative expenses are projected to be between $82 million and $85 million for the full year 2024[8] - General and administrative expenses for the quarter ended September 25, 2024, increased to $19,831,000 from $18,237,000 for the quarter ended September 27, 2023[28] - Interest expense for the quarter ended September 25, 2024, was $4,381,000, compared to $13,288,000 for the quarter ended September 27, 2023[23] - Total costs of operating revenue were $232,317 million (68.8%)[33] Debt and Liabilities - The company ended the quarter with total debt outstanding of $272.0 million, including $261.0 million in borrowings under its credit facility[6] - Total current assets decreased to $33,851,000 as of 9/25/24, down from $44,050,000 as of 12/27/23, reflecting a decline of 23.1%[17] - Total liabilities decreased to $516,106,000 as of 9/25/24, down from $527,504,000 as of 12/27/23, a reduction of 2.6%[17] - Total debt increased to $271,997,000 as of 9/25/24, up from $266,033,000 as of 12/27/23, an increase of 2.3%[17] Restaurant Operations and Development - The company plans to open 30 to 40 new restaurants in 2024, including 12 to 16 new Keke's restaurants, with a projected net decline of 45 to 55 restaurants[8] - Denny's ended the quarter with 1,541 total units, a net decrease of 16 units compared to the previous quarter[35] - Keke's opened 4 new units year-to-date, resulting in a total of 62 units[35] - Year-to-date 2024, Denny's had 1,548 equivalent units, down 42 units from 2023[35] - Denny's closed 58 units year-to-date, with a net change of (48) units[35] - Denny's refranchised 3 units in the quarter, while Keke's refranchised 1 unit[35] Margins and Profitability - Adjusted franchise operating margin was $30.1 million, or 51.0% of franchise and license revenue, consistent with the prior year quarter[5] - Restaurant-level operating margin for the quarter ended September 25, 2024, was $35,940,000, a decrease of 6.4% from $38,480,000 for the quarter ended September 27, 2023[28] - Company restaurant operating margin for the quarter ended September 25, 2024, was 11.2%, down from 13.7% for the quarter ended September 27, 2023[29] - Franchise operating margin for the quarter ended September 25, 2024, was $30,059,000, a decrease from $31,220,000 for the quarter ended September 27, 2023[28] - The adjusted company restaurant operating margin (non-GAAP) was $19,450 million (12.2%), compared to $23,138 million (14.3%) in the previous year[32] Shareholder Information - Basic weighted average shares outstanding decreased to 52,148,000 for the quarter ended 9/25/24, down from 55,869,000 for the quarter ended 9/27/23[18] - The effective tax rate for the quarter ended September 25, 2024, was 0.6%, significantly lower than the 11.9% for the quarter ended September 27, 2023[23]