Denny's Corporation Reports Results for Fourth Quarter and Full Year 2024

Core Insights - Denny's Corporation reported strong performance in 2024, with both Denny's and Keke's outperforming their respective BBI Family Dining indices in Q4 [2] - The company is focusing on enhancing brand health by closing lower-volume restaurants, remodeling existing locations, and expanding Keke's into new states [2] - The outlook for 2025 anticipates challenges due to macroeconomic factors affecting consumer sentiment, but the company is positioned to deliver shareholder value through strategic actions [2] Fourth Quarter 2024 Highlights - Total operating revenue was $114.7 million, slightly down from $115.4 million in the prior year quarter [6] - Franchise and license revenue increased to $62.3 million from $61.3 million, driven by higher local advertising contributions [6] - Denny's same-restaurant sales were up 1.1%, while Keke's saw a 3.0% increase [6] - Operating income rose to $14.5 million from $7.7 million in the prior year quarter [6] - Net income was $6.8 million, or $0.13 per diluted share, compared to $2.9 million, or $0.05 per diluted share, in the prior year [10][28] Full Year 2024 Highlights - Total operating revenue for the year was $452.3 million, down from $463.9 million in the previous year [6] - Denny's same-restaurant sales decreased by 0.2%, while Keke's same-restaurant sales fell by 1.7% [6] - Operating income for the year was $45.3 million, down from $52.8 million [6] - Net income for the year was $21.6 million, or $0.41 per diluted share, compared to $19.9 million, or $0.36 per diluted share, in the previous year [31] Capital Allocation - The company invested $10.9 million in cash capital expenditures during Q4 and $28.6 million for the full year, focusing on Keke's new cafe development and remodels [12] - Share repurchases totaled $11.2 million for the year, with approximately $89.2 million remaining under the existing repurchase authorization [12] Business Outlook for 2025 - Denny's expects same-restaurant sales to range between -2.0% and 1.0% [13] - The company plans to open 25 to 40 new restaurants while closing 70 to 90 [13] - Commodity inflation is anticipated to be between 2.0% and 4.0%, and labor inflation between 2.5% and 3.5% [13] - Adjusted EBITDA is projected to be between $80 million and $85 million [13]