Wendy’s International, Inc. announces 2006 Third Quarter results
Wendy’s brand produces significantly improved same-store sales
and profit margins
DUBLIN, Ohio (October 26, 2006) – Wendy’s International, Inc. (NYSE:WEN) today announced its financial results for the third quarter of 2006.
The Company completed its spinoff of Tim Hortons® on September 29. During the third quarter, the Company also approved the prospective sale of Baja Fresh® Mexican Grill. Accordingly, after-tax operating results of Tim Hortons and Baja Fresh appear in the “Discontinued Operations” line on the income statement. The Company announced an agreement to sell Baja Fresh on October 12 and expects the transaction to close in the fourth quarter.
Total revenues from continuing operations increased 2.5% to $623.8 million, compared to $608.8 million in the third quarter of 2005.
The Company reported third-quarter net income of $72.0 million and total diluted earnings per share of $0.61, compared to $72.1 million and $0.61, respectively, in 2005.
Company reports diluted EPS from continuing operations of 16 cents
Reported third-quarter pretax income from continuing operations (Wendy’s® and Cafe Express) was $25.2 million compared to $34.1 million in 2005. The Company reported after-tax income from continuing operations of $19.4 million, or $0.16 per share, compared to $20.0 million, or $0.17 per share, in 2005. The Company’s third-quarter 2006 reported results from continuing operations include the impact of the following items:
- A lower number of Wendy’s restaurants relative to the third quarter of 2005, including 31 fewer company-operated domestic restaurants and 11 fewer company-operated Canadian restaurants. Also, the Company opened 34 new restaurants in the third quarter compared to 46 in the third quarter of 2005.
- Approximately $4.3 million less in pretax rental income in the quarter compared to a year ago due to the sale of Wendy’s properties leased to franchisees during 2005 and 2006, which impacts the franchise revenue line on the income statement.
- No significant property sales in the 2006 quarter, compared to a $4.7 million pretax gain on the sale of properties leased to franchisees in 2005.
- General and administrative expense of $63.4 million, or 10.2% of revenues, compared to $52.3 million, or 8.6% of revenues, in the third quarter of 2005. The year-over-year increase is due to:
- $3 million in pretax expense for consulting charges and professional services.
- $1 million in pretax expense for research and development related to the breakfast program that the Company is currently testing in 120 restaurants in the U.S.
- Higher accruals for performance-based incentive compensation of $7.0 million in the third quarter of 2006, as the Company expects to pay partial bonuses commensurate with stronger second-half operating results compared to 2005. The Company recorded an expense reduction for incentive compensation in the third quarter of 2005 due to lower-than-expected operating results.
- Other expense of $6.2 million compared to other income of $4.2 million in the third quarter of 2005, which includes:
- $5.8 million in pretax fixed and intangible asset impairment and related charges for Cafe Express in the third quarter of 2006.
- $5.5 million in pretax charges related to the anticipated closure of 20 underperforming Wendy’s company-operated restaurants recorded during the third quarter of 2006. The Company plans to close a total of 30 to 40 restaurants in the next six months.
- Approximately $2 million in restructuring charges during the third quarter of 2006.
- A benefit of approximately $2 million due to favorable adjustments of the Company’s legal reserves.
- $8.9 million in interest expense compared to $11.2 million in the third quarter of 2005 and $14.6 million in interest income compared to $1.2 million in the third quarter of 2005. The increase in interest income primarily relates to funds received from Tim Hortons after its initial public offering in March, while the decrease in interest expense primarily relates to the Company’s repayment of its 6.35% notes in December 2005.
- A lower effective tax rate of 22.8% in the third quarter of 2006 compared to 41.3% in the third quarter of 2005, reflecting approximately $4 million in lower reserves and additional tax credits relative to the third quarter of 2005.
“As we complete our strategic initiatives of spinning off Tim Hortons, selling Baja Fresh and reducing costs, we are sharpening our focus on the Wendy’s brand,” said interim Chief Executive Officer and President Kerrii Anderson. “By following our new comprehensive strategic plan, ‘Quality-Driven: Wendy’s Recipe for Success,’ we intend to continue driving improved restaurant-level economic performance by focusing on product innovation, targeted marketing, cost containment and operations excellence.”
Wendy’s brand demonstrates significantly improved results
Wendy’s store-level operating results were significantly improved compared to the third quarter of 2005, with pretax profits at company-operated restaurants and royalty revenues up $9.8 million.
“Wendy’s results indicate the brand’s turnaround is under way,” Anderson said. “During the third quarter, we produced our best same-store sales in eight quarters, and food costs were significantly better compared to one year ago.”
Wendy’s third-quarter segment results included the following highlights:
- Average same-store sales increased 4.1% at Wendy’s U.S. company-operated restaurants and 3.9% at Wendy’s U.S. franchised restaurants, driven by higher transactions due to a stronger promotional calendar, new products and more effective menu management.
- Total Wendy’s segment revenue increased 2.4% from $601 million in the third quarter of 2005 to $615 million, reflecting the average same-store sales increases, partially offset by restaurant closures in late 2005 and lower rent revenues from franchisees due to the 2005 sale of 171 sites previously leased to franchisees. The Company’s third-quarter 2005 revenues also included gains on the sale of Wendy’s properties leased to franchisees.
- Profit margins at company-operated restaurants improved compared to the third quarter of 2005. Wendy’s U.S. company-operated restaurant food costs improved by 110 basis points, from 30.2% of Wendy’s retail sales in the third quarter a year ago to 29.1%. The improvement was due primarily to lower beef costs and improved menu management, with the introduction of higher-margin products such as the vanilla Frosty™, crispy chicken sandwiches and Frescata™ deli sandwiches.
- Wendy’s U.S. company-operated restaurant labor costs improved by 70 basis points, from 28.3% in the third quarter a year ago to 27.6%, primarily due to leverage from improved same-store sales.
During the third quarter, Wendy’s launched its new Frescata Italiana sandwich. The Company also tested several new products during the third quarter, including the 4-Alarm Spicy Chicken Sandwich, “Big Dipper” wing-sized chicken fillets with sauces, and a Chunky Chicken Salad Frescata sandwich.
Wendy’s to introduce new “Double-Melt” cheeseburger and gift card program in 4th Quarter
The Company in October is promoting its 99-cent junior bacon cheeseburger and crispy chicken sandwich, products that have historically increased transactions. In November, Wendy’s will promote its new Double Melt cheeseburgers, featuring fresh ground beef patties layered with melted cheese, fresh toppings and other flavors. The Company will also introduce for the first time a Wendy’s gift card program.
Management reiterates outlook for 4th Quarter 2006
The Company expects to produce positive same-store sales in the fourth quarter of 2006, although comparable sales comparisons in October and November of 2005 are more challenging than the third-quarter 2005 comparisons. The Company anticipates that its beef costs will be approximately 4% lower than in the fourth quarter of 2005, and also expects to realize $5 million to $6 million in incremental interest income relative to the fourth quarter of 2005.
In addition, the Company 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.
CEO search continues
The Company announced today that the Board of Directors’ search process for a permanent Chief Executive Officer and President continues.
Chairman Jim Pickett said that Kerrii Anderson continues to be a candidate for the permanent CEO and President position, and that the Board continues to consider external candidates.
The Company will issue a news release and other necessary disclosures regarding the search at the appropriate time.
Company’s modified “Dutch Auction” tender offer under way
The Company last week commenced 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.
Board approves 115th consecutive dividend
The Board of Directors approved a quarterly dividend of 8.5 cents per share, payable on November 20 to shareholders of record as of November 6. The dividend will be the Company’s 115th consecutive dividend. Because the record date for the dividend payment is before the expiration date of the tender offer, shareholders of record on November 6 who tender their shares in the tender offer will be entitled to this dividend payment.
Third-Quarter Same-Store Sales Summary
|
3Q 2006 |
3Q 2005 |
2006 YTD |
Wendy’s U.S. Company |
4.1% |
(5.0%) |
0.0% |
Wendy’s U.S. Franchise |
3.9% |
(5.5%) |
(0.1%) |
Disclosure regarding non-GAAP financial measures
During today’s conference call, Management will identify differences between the Company’s 2005 reported Operating Income of $135 million plus its 2005 Depreciation of Property and Equipment of $141 million (which together total $276 million and are included in the Company’s Form 8-K filed on October 5, 2006) and its recent guidance for 2007 Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of $330 million to $340 million, including approximately $80 million to $90 million of improvement in Wendy’s operating results from 2005 to 2007.
EBITDA is a performance measure used by management for benchmarking against the Company’s peers and competitors. The Company believes EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties to evaluate companies in the restaurant industry. EBITDA is not a recognized term under GAAP.
The following is a reconciliation of 2007 estimated operating income to 2007 estimated EBITDA:
2007 estimated operating income: $200 million to $210 million
2007 estimated depreciation and amortization: $130 million
2007 estimated EBITDA: $330 million to $340 million
Third-quarter earnings conference call scheduled for October 26
The Company will host a conference call beginning at 4:00 p.m. (Eastern) today, October 26. To participate in the conference call, the dial-in number is (877) 572-6014 (U.S. and Canada) or (706) 679-4852 (International). No need to register in advance. A simultaneous webcast will also be available at www.wendys-invest.com. The call will also be archived at that site.
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.
INVESTOR AND MEDIA CONTACTS:
John Barker: (614) 764-3044 or john_barker@wendys.com
David Poplar (614) 764-3547 or david_poplar@wendys.com
WENDY'S INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
Third Quarter Ended
10/1/2006 10/2/2005 $ Change % Change
---------- ---------- -------- ---------
REVENUES
Retail sales $550,326 $531,146 $19,180 3.6%
Franchise revenues 73,427 77,639 (4,212) -5.4%
---------- ---------- -------- ---------
TOTAL REVENUES 623,753 608,785 14,968 2.5%
---------- ---------- -------- ---------
COSTS & EXPENSES
Cost of sales 335,979 332,024 3,955 1.2%
Company restaurant operating
costs 158,486 146,883 11,603 7.9%
Operating costs 8,323 4,722 3,601 76.3%
Depreciation of property &
equipment 31,928 33,040 (1,112) -3.4%
General & administrative
expenses 63,417 52,300 11,117 21.3%
Other (income) expense, net 6,223 (4,234) 10,457 n/m
---------- ---------- -------- ---------
TOTAL COSTS & EXPENSES 604,356 564,735 39,621 7.0%
---------- ---------- -------- ---------
OPERATING (LOSS) INCOME 19,397 44,050 (24,653) -56.0%
Interest expense (8,872) (11,156) 2,284 20.5%
Interest income 14,632 1,160 13,472 n/m
---------- ---------- -------- ---------
INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME
TAXES 25,157 34,054 (8,897) -26.1%
INCOME TAXES 5,737 14,063 (8,326) n/m
---------- ---------- -------- ---------
INCOME from continuing
operations $19,420 $19,991 ($571) -2.9%
INCOME from discontinued
operations $52,536 $52,097 439 0.8%
---------- ---------- -------- ---------
NET INCOME $71,956 $72,088 ($132) -0.2%
========== ========== ======== =========
Diluted earnings per common
share from continuing
operations $0.16 $0.17 ($0.01) -5.9%
========== ========== ======== =========
Diluted earnings per common
share from discontinued
operations $0.45 $0.44 $0.01 2.3%
========== ========== ======== =========
Total Diluted earnings per
common share $0.61 $0.61 $0.00 0.0%
========== ========== ======== =========
Diluted shares 118,290 117,656 634 0.5%
========== ========== ======== =========
n/m - not meaningful
WENDY'S INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
Year-to-Date Ended
10/1/2006 10/2/2005 $ Change % Change
----------- ----------- --------- ---------
REVENUES
Retail sales $1,608,230 $1,599,640 $8,590 0.5%
Franchise revenues 215,012 229,783 (14,771) -6.4%
----------- ----------- --------- ---------
TOTAL REVENUES 1,823,242 1,829,423 (6,181) -0.3%
----------- ----------- --------- ---------
COSTS & EXPENSES
Cost of sales 991,465 1,001,530 (10,065) -1.0%
Company restaurant
operating costs 462,093 445,725 16,368 3.7%
Operating costs 42,497 14,531 27,966 192.5%
Depreciation of property &
equipment 95,503 98,248 (2,745) -2.8%
General & administrative
expenses 172,818 159,005 13,813 8.7%
Other (income) expense, net 29,258 (10,584) 39,842 n/m
----------- ----------- --------- ---------
TOTAL COSTS & EXPENSES 1,793,634 1,708,455 85,179 5.0%
----------- ----------- --------- ---------
OPERATING INCOME 29,608 120,968 (91,360) -75.5%
Interest expense (26,753) (32,418) 5,665 17.5%
Interest income 27,654 2,550 25,104 n/m
----------- ----------- --------- ---------
INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME
TAXES 30,509 91,100 (60,591) -66.5%
INCOME TAXES 8,809 36,955 (28,146) n/m
----------- ----------- --------- ---------
INCOME from continuing
operations 21,700 54,145 (32,445) -59.9%
INCOME from discontinued
operations 72,373 139,959 (67,586) -48.3%
----------- ----------- --------- ---------
NET INCOME 94,073 194,104 (100,031) -51.5%
=========== =========== ========= =========
Diluted earnings per common
share from continuing
operations $0.18 $0.47 ($0.29) -61.7%
=========== =========== ========= =========
Diluted earnings per common
share from discontinued
operations $0.62 $1.20 ($0.58) -48.3%
=========== =========== ========= =========
Total Diluted earnings per
common share $0.80 $1.67 ($0.87) -52.1%
=========== =========== ========= =========
Diluted shares 117,485 116,293 1,192 1.0%
=========== =========== ========= =========
n/m - not meaningful
WENDY'S INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
October 1, January 1,
2006 2006
----------- -----------
(Unaudited)
(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents $1,162,935 $233,034
Accounts receivable, net 77,167 62,461
Notes receivable, net 542 1,817
Deferred income taxes 52,868 23,847
Inventories and other 35,049 28,251
Advertising fund restricted assets 37,794 35,651
Assets held for disposition 17,542 66,803
Current assets of discontinued operations 7,319 304,702
----------- -----------
1,391,216 756,566
----------- -----------
Property and equipment 2,048,457 2,107,796
Accumulated depreciation (799,164) (753,199)
----------- -----------
1,249,293 1,354,597
----------- -----------
Notes receivable, net 5,224 1,860
Goodwill 81,864 81,875
Deferred income taxes 3,498 2,855
Intangible assets, net 5,703 8,330
Other assets 117,192 75,566
Non current assets of discontinued operations 32,387 1,158,669
----------- -----------
$2,886,377 $3,440,318
=========== ===========
WENDY'S INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
October 1, January 1,
2006 2006
----------- -----------
(Unaudited)
(Dollars in thousands)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $81,923 $93,095
Accrued expenses:
Salaries and wages 41,360 35,021
Taxes 49,429 77,148
Insurance 57,530 58,147
Other 58,209 34,080
Advertising fund restricted liabilities 33,455 35,650
Current portion of long-term obligations 2,114 2,497
Current liabilities of discontinued operations 11,957 247,714
----------- -----------
335,977 583,352
----------- -----------
Long-term obligations
Term debt 525,483 521,800
Capital leases 19,166 18,336
----------- -----------
544,649 540,136
----------- -----------
Deferred income taxes 90,893 72,188
Other long-term liabilities 64,352 69,467
Non current liabilities of discontinued
operations 5,129 116,586
Commitments and contingencies
Shareholders' equity
Preferred stock, Authorized: 250,000 shares
Common stock, $.10 stated value per share,
Authorized: 200,000,000 shares,
Issued: 129,310,000 and 125,490,000 shares,
respectively 12,931 12,549
Capital in excess of stated value 1,087,810 405,588
Retained earnings 1,247,282 1,858,743
Accumulated other comprehensive income
(expense):
Cumulative translation adjustments and other 13,182 115,252
Pension liability (1,096) (1,096)
----------- -----------
2,360,109 2,391,036
Treasury stock, at cost:
11,431,000 and 7,681,000 shares,
respectively (514,732) (294,669)
Unearned compensation - restricted stock (37,778)
----------- -----------
1,845,377 2,058,589
----------- -----------
$2,886,377 $3,440,318
=========== ===========
WENDY'S INTERNATIONAL, INC. AND SUBSIDIARIES
REVENUES BY SEGMENT
(in thousands): Increase (Decrease)
Third Quarter Ended From Prior Year
----------------------------------- -------------------
October 1, % of October 2, % of
2006 Total 2005 Total Dollars Percentage
----------------- ----------------- -------------------
Retail Sales
--------------
Wendy's $541,949 98.5% $523,218 98.5% $18,731 3.6%
Cafe Express 8,377 1.5% 7,928 1.5% 449 5.7%
----------- ----------- ---------
$550,326 100.0% $531,146 100.0% $19,180 3.6%
=========== =========== =========
Franchise
Revenues
--------------
Wendy's $73,427 100.0% $77,639 100.0% ($4,212) -5.4%
Cafe Express 0 0.0% 0 0.0% 0
----------- ----------- ---------
$73,427 100.0% $77,639 100.0% ($4,212) -5.4%
=========== =========== =========
Total Revenues
--------------
Wendy's $615,376 98.7% $600,857 98.7% $14,519 2.4%
Cafe Express 8,377 1.3% 7,928 1.3% 449 5.7%
----------- ----------- ---------
$623,753 100.0% $608,785 100.0% $14,968 2.5%
=========== =========== =========
(in thousands): Increase (Decrease)
Year-to-Date Ended From Prior Year
----------------------------------- -------------------
October 1, % of October 2, % of
2006 Total 2005 Total Dollars Percentage
----------------- ----------------- -------------------
Retail Sales
--------------
Wendy's $1,583,461 98.5% $1,575,078 98.5% $8,383 0.5%
Cafe Express 24,769 1.5% 24,562 1.5% 207 0.8%
----------- ----------- ---------
$1,608,230 100.0% $1,599,640 100.0% $8,590 0.5%
=========== =========== =========
Franchise
Revenues
--------------
Wendy's $215,012 100.0% $229,783 100.0% ($14,771) -6.4%
Cafe Express 0 0.0% 0 0.0% 0
----------- ----------- ---------
$215,012 100.0% $229,783 100.0% ($14,771) -6.4%
=========== =========== =========
Total Revenues
--------------
Wendy's $1,798,473 98.6% $1,804,861 98.7% ($6,388) -0.4%
Cafe Express 24,769 1.4% 24,562 1.3% 207 0.8%
----------- ----------- ---------
$1,823,242 100.0% $1,829,423 100.0% ($6,181) -0.3%
=========== =========== =========
WENDY'S INTERNATIONAL, INC. AND SUBSIDIARIES
OPERATING INCOME BY SEGMENT
(in thousands):
Third Quarter Ended Change
------------------------------------- -------------------
October 1, % of October 2, % of
2006 Revenues 2005 Revenues Dollars Percentage
------------------ ------------------ -------------------
Operating
Income
(Loss)
-------------
Wendy's $26,529 4.3% $45,219 7.5% ($18,690) -41.3%
Cafe Express (7,132) -85.1% (1,169) -14.7% (5,963) n/m
---------- ---------- ---------
Segment
operating
income $19,397 3.1% $44,050 7.2% ($24,653) -56.0%
========== ========== =========
n/m - not meaningful
(in thousands):
Year-to-Date Ended Change
------------------------------------- -------------------
October 1, % of October 2, % of
2006 Revenues 2005 Revenues Dollars Percentage
------------------ ------------------ -------------------
Operating
Income
(Loss)
-------------
Wendy's $38,720 2.2% $124,047 6.9% ($85,327) -68.8%
Cafe Express (9,112) -36.8% (3,079) -12.5% (6,033) n/m
---------- ---------- ---------
Segment
operating
income $29,608 1.6% $120,968 6.6% ($91,360) -75.5%
========== ========== =========
n/m - not meaningful
WENDY'S INTERNATIONAL, INC. AND SUBSIDIARIES
SYSTEMWIDE RESTAURANTS
Increase/ Increase/
As of As of (Decrease) As of (Decrease)
October 1, July 2, From Prior October 2, From Prior
2006 2006 Quarter 2005 Year
---------------------------------------------------
Wendy's
-------------------
U.S.
Company 1,320 1,322 (2) 1,351 (31)
Franchise 4,692 4,693 (1) 4,666 26
---------------------------------------------------
6,012 6,015 (3) 6,017 (5)
Canada
Company 148 148 0 159 (11)
Franchise 231 233 (2) 226 5
---------------------------------------------------
379 381 (2) 385 (6)
Other International
Company 5 5 0 5 0
Franchise 345 342 3 343 2
---------------------------------------------------
350 347 3 348 2
Total Wendy's
Company 1,473 1,475 (2) 1,515 (42)
Franchise 5,268 5,268 0 5,235 33
---------------------------------------------------
6,741 6,743 (2) 6,750 (9)
===================================================
Baja Fresh
-------------------
U.S.
Company 143 143 0 146 (3)
Franchise 154 155 (1) 156 (2)
---------------------------------------------------
Total Baja Fresh 297 298 (1) 302 (5)
===================================================
Cafe Express
-------------------
U.S.
Company 19 19 0 19 0
---------------------------------------------------
Total Cafe Express 19 19 0 19 0
===================================================
Total System
Company 1,635 1,637 (2) 1,680 (45)
Franchise 5,422 5,423 (1) 5,391 31
---------------------------------------------------
7,057 7,060 (3) 7,071 (14)
===================================================
WENDY'S INTERNATIONAL, INC.
Income Statement Definitions
Retail Sales Includes sales from company operated
restaurants. Also included are the sales to
franchisees from Wendy's bun baking facilities.
Franchise Revenues Consists primarily of royalties, rental income
and franchise fees. Franchise fees include
charges for various costs and expenses related
to establishing a franchisee's business.
Cost of Sales Includes food, paper and labor costs for
restaurants. Also included are the cost of
goods sold to franchisees from Wendy's bun
baking facilities.
Company Restaurant Consists of all costs necessary to manage and
Operating Costs operate restaurants, except cost of sales and
depreciation. These include advertising,
insurance, maintenance, rent, etc., as well as
support costs for personnel directly related to
restaurant operations.
Operating Costs Includes rent expense related to properties
leased to franchisees and costs to operate and
maintain Wendy's bun baking facilities.
General and Costs that cannot be directly related to
Administrative generating revenue.
Expenses
Other Income and Includes expenses (income) that are not directly
Expense derived from the Company's primary businesses.
This includes income from the Company's
investments in joint ventures and other
minority investments. Expenses include store
closures, other asset write-offs and
restructuring costs.
Income from Reflects net income from Tim Hortons Inc and
Discontinued Baja Fresh.
Operations
###
|
