030169 Wendy's Earnings Up on Strong SalesJanuary 30, 2003Dublin, OH - Wendy's International Inc. said its fourth-quarter earnings rose 8.8% because of strong sales and improvements in its Wendy's and Tim Hortons chains. The third largest hamburger chain earned $50.7 million, or 44 cents per share, matching consensus estimates by analysts from Thomson First Call. A year ago, the company earned $46.6 million, or 42 cents per share. Wendy's said it had its first profit with its U.S. Tim Hortons stores, which sell coffee, doughnuts and sandwiches. Fourth-quarter revenue rose 15.6% to a record $711.7 million from $615.7 million a year earlier. Same-store sales were up 1% at Wendy's U.S. company restaurants, 5.7% at Tim Hortons Canada and 7.2% at Tim Hortons in the United States. Cost controls and lower beef costs helped increase the company's domestic operating margin, and its salads were "a major success," said spokesman John Barker. "We made excellent progress in 2002. In addition to producing outstanding sales, our management team, employees and operators controlled costs effectively," said Kerrii Anderson, chief financial officer. Wendy's stock fell 4 cents to close Friday at $27.15 on the New York Stock Exchange. For 2002, Wendy's earned $218.8 million, or $1.89 per share, up from $193.6 million, or $1.65 per share, in 2001. Revenue increased 14.2% to $2.7 billion from $2.4 billion. During the year, Wendy's and its franchisees opened 586 new restaurants, giving the company an all-time high of 8,811 restaurants systemwide. The company invested capital to build new Wendy's and Tim Hortons restaurants. In 2002, Wendy's also acquired Baja Fresh Mexican Grill for about $275 million and made investments in Cafe Express, a Houston-based restaurant that offers upscale meals in a fast-food format, and Pasta Pomodoro, a fast-casual chain.
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