NPC International, Inc. Reports Second Quarter Results
OVERLAND PARK, KANSAS, (AUGUST 14, 2015) - NPC International, Inc. (the "Company" or "NPC"), today reported results for its second fiscal quarter ended June 30, 2015.
SECOND QUARTER HIGHLIGHTS:
- Pizza Hut comparable store sales were flat rolling over a decrease of (5.6)% last year.
- Wendy's comparable store sales decreased (0.5)% in the 87 stores acquired in fiscal 2013.
- Adjusted EBITDA (reconciliation attached) was $29.5MM; an increase of $8.6MM or 41% from the prior year.
- The Company generated net income of $0.1MM compared to a net loss of $1.4MM last year.
- Pizza Hut comparable store sales decreased (1.6)% rolling over a decrease of (5.1)% last year.
- Wendy's comparable store sales were flat for the 87 stores acquired in fiscal 2013.
- Adjusted EBITDA (reconciliation attached) was $61.8MM; an increase of $11.9MM or 24% from the prior year.
- Net income was $5.0MM, an increase of $3.5MM from last year.
- Cash balances were $33.5MM, an increase of $21.4MM from fiscal year end.
- Our leverage ratio was 4.76X Consolidated EBITDA, net of allowable cash balances (as defined in our Credit Agreement).
NPC's President and CEO Jim Schwartz said, "Continued commodity deflation in our Pizza Hut business and margin expansion and contributions from acquired stores in our growing Wendy's business resulted in a 41% increase in EBITDA during the second quarter over the prior year. In addition, our cash balances grew by $21.4 million from fiscal year end due to increased EBITDA and a 25% reduction in our capex spend year-to-date compared to the prior year.
Our Pizza Hut business improved its sales trend from recent quarters delivering flat comparable store sales this quarter. While this was a welcome change in performance for the business there remains significant work to be done to improve our competitive position in the category and this quarter was a step in the right direction.
We were disappointed with our slightly negative comparable store sales in our Wendy's business this quarter. However, we remain enthused about the brand's direction and positioning in the marketplace and look forward to growing this business organically and through acquisition. To this end we remain on pace to complete our targeted 9 reimages and 3 refreshes this year with 3 reimages completed as of the second quarter. We remain optimistic about this program as the completed image activations are delivering upon expectations.
The significant progress that we made during the second quarter improved our operating results and liquidity resulting in a significant improvement in our leverage position from 4.94X at the end of our first quarter to 4.76X this quarter. We look forward to continued improvement and reporting upon our progress."
The Company is a wholly-owned subsidiary of NPC Restaurant Holdings, LLC ("Parent"), which has guaranteed the Company's 10.50% Senior Notes due 2020. As a result of its guaranty, Parent is required to file reports with the Securities and Exchange Commission which include consolidated financial statements of Parent and its subsidiaries (including the Company). Parent's only material asset is all of the stock of the Company. The quarterly financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations for Parent and the Company on a consolidated basis are set forth in Parent's Form 10-Q for the fiscal quarter ended June 30, 2015 which can be accessed at www.sec.gov.
CONFERENCE CALL INFORMATION:
The Company's second quarter earnings conference call will be held Monday, August 17, 2015 at 9:00 am CT (10:00 ET). In addition to a discussion of second quarter results, the call may also include discussion of Company developments, forward-looking information and other material information about business and financial matters. You can access this call by dialing 888-391-6937. The international number is 716-247-5763. The access code for the call is 98867386.
For those unable to participate live, a replay of the call will be available until August 24, 2015 by dialing 855-859-2056 or by dialing international at 404-537-3406. The access code for the replay is 98867386.
A replay of the call will also be available at the Company's website at www.npcinternational.com.
NPC International, Inc. is the world's largest Pizza Hut franchisee and currently operates 1,262 Pizza Hut units in 28 states and 143 Wendy's units in 5 states.
For more complete information regarding the Company's financial position and results of operations, investors are encouraged to review the Parent's financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations, incorporated into the Parent's Form 10-Q which can be accessed at www.sec.gov.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995
Certain statements contained in this news release that do not relate to historical or current facts constitute forward-looking statements. These include statements regarding our plans and expectations. Forward-looking statements are subject to inherent risks and uncertainties and there can be no assurance that such statements will prove to be correct. Actual results may vary materially from those anticipated in such forward-looking statements as a result of a number of factors, including lower than anticipated consumer discretionary spending; deterioration in general economic conditions; competition in the quick service restaurant market; adverse changes in food, labor and other costs; price inflation or deflation; our ability to successfully complete acquisitions of additional restaurant units; and other factors. These risks and other risks are described in Parent's filings with the Securities and Exchange Commission, including Parent's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Copies of these filings may be obtained by contacting NPC or may be accessed at www.sec.gov. All forward-looking statements made in this news release are made as of the date hereof. NPC does not intend to update these forward-looking statements and undertakes no duty to any person to provide any such update under any circumstances. Investors are cautioned not to place undue reliance on any forward-looking statements.
Contact: Troy D. Cook, Executive Vice President-Finance & Chief Financial Officer
7300 W 129th St
Overland Park, KS 66213