The company’s promotions attracted more consumers to their store, with sales growth of 1.6% for stores open more than one year. Analysts pegged the company’s sales growth at 1.1%.
The company’s higher sales growth was offset by falling net income, down to $22.3 million on the quarter compared to $25.4 million a year prior. The company’s profit per share remained at $0.09, while the company’s revenue also declined to $285.8 million, down 24.5%. The revenue decline is attributed to sales of stores to franchises.
Wendy’s Co NASDAQ: WEN owns 301 fewer company-owned operations compared to the same period a year prior. Higher franchise rental income and royalty revenue helped to offset losses.
Analysts expected the company to have revenue of $282.6 million.
The company opened more global restaurants compared to the same period a year prior, with 18 total North American and 15 international restaurants open. The company opened three more locations in Q1 2017 than in Q1 2016.
Wendy’s Co NASDAQ: WEN Experiencing Global Growth
International and North American sales are up on the quarter.
Operating profit is down 4.9% from $63.8 million to $60.7 million, with increasing operating expenses to blame. The expenses are linked to a lease buyout in the previous year. Adjusted EBITDA for the first quarter decreased on a year-over-year basis, down 9.1% to $89.2 million.
Capital expenditures are down from $38.8 million in Q1 2016 to $14.8 million in the most recent quarter. Free cash flow rose 98.3% from $12.0 million to $23.8 million as a result of capital expenditure decreases. The company’s quarterly cash dividend will be $0.07 per share and will be payable on June 15, 2017. The company’s 2017 outlook includes an adjusted EBITDA of $400 million to $406 million, with general and administrative expenses between $210 million and $220 million.