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DUBLIN, Ohio (November 9, 2006) – Wendy’s International, Inc. (NYSE:WEN) today announced positive monthly same-store sales for the October period ending Sunday, November 5, 2006.
Preliminary October same-store sales at Wendy’s® company-operated restaurants were 1.8% compared to negative 2.1% in October 2005. October same-store sales at Wendy’s franchised restaurants were 0.8% compared to negative 1.0% in October 2005.
“We are pleased to have produced our fifth consecutive month of positive same-store sales in October, despite more challenging 2005 comparable sales than we have faced since January,” said interim Chief Executive Officer and President Kerrii Anderson. “We are confident that our strong November promotional calendar will result in strengthening sales trends.”
October Same-Store Sales Summary
| |
October 2006 |
October 2005 |
YTD
|
| Wendy's U.S. Company |
1.8% |
(2.1%) |
0.2% |
| Wendy's U.S. Franchise |
0.8% |
(1.0%) |
0.0% |
The Company in October promoted its 99-cent junior bacon cheeseburger and crispy chicken sandwich. This compares to the Company’s Bacon Mushroom Melt promotion in October 2005, which had a significantly greater positive impact on average check.
Wendy’s to promote new products, gift cards in November and December
In November, Wendy’s is promoting its new Double Melt cheeseburgers, featuring fresh ground beef patties layered with melted cheese, fresh toppings and other flavors. The Company has also introduced for the first time a Wendy’s gift card program.
Wendy’s in December will reintroduce its Chicken Club sandwich, featuring a chicken fillet, natural Swiss cheese, bacon, mayonnaise, tomato and lettuce on a Kaiser roll.
The Company anticipates that its fourth-quarter beef costs will be approximately 4% lower in 2006 than in the fourth quarter of 2005, and expects to realize $5 million to $6 million in incremental interest income relative to the fourth quarter of 2005.
The Company also anticipates that it will incur additional costs in the fourth quarter, including $4 million to $8 million in pretax charges for the closure of Wendy’s restaurants and approximately $3 million in pretax expense for research and development related to its breakfast test. In addition, the Company expects to record higher expense for performance-based incentive compensation in the fourth quarter of 2006 commensurate with anticipated improved operating results compared to 2005.
Company’s modified “Dutch Auction” tender offer under way
The Company commenced on October 18 a modified “Dutch Auction” tender offer to purchase up to 22.2 million of its common shares in a price range of $33.00 to $36.00 per share, for a maximum aggregate repurchase price of up to $800 million. The shares sought represent approximately 19% of the Company’s shares outstanding as of October 12, 2006. The tender offer will expire, unless extended by Wendy’s, at 5 p.m., Eastern Time, on November 16, 2006.
Safe Harbor statement
Certain information in this news release, particularly information regarding future economic performance and finances, and plans, expectations and objectives of management, is forward looking. Factors set forth in our Safe Harbor under the Private Securities Litigation Reform Act of 1995, in addition to other possible factors not listed, could affect the Company's actual results and cause such results to differ materially from those expressed in forward-looking statements. Please review the Company’s Safe Harbor statement at http://www.wendys-invest.com/safeharbor.
Wendy’s International, Inc. overview
Wendy's International, Inc. is one of the world's most successful restaurant operating and franchising companies, with more than 6,300 Wendy's Old Fashioned Hamburgers restaurants in North America and more than 300 international Wendy’s restaurants. More information about the Company is available at www.wendys-invest.com.
Tender offer statement
The company has retained JP Morgan Securities Inc. and Goldman, Sachs & Co. to serve as Co-Dealer Managers for the tender offer. Requests for documents may be directed to Georgeson Inc., the information agent, at (866) 277-0928. Questions regarding the tender offer may be directed to JP Morgan Securities Inc. by calling toll-free at (877) 371-5947 or to Goldman, Sachs & Co. by calling toll-free at (800) 323-5678.
This announcement is not an offer to purchase or a solicitation of an offer to sell with respect to any securities. The tender offer is being made solely by the Offer to Purchase dated October 18, 2006.
