Krispy Kreme Profit Misses Estimate; Stock Down 5%

(RTTNews) - Krispy Kreme Doughnuts Inc (KKD) Tuesday reported a higher profit for the second quarter, helped by lower income tax expense and absence of debt charges of last year. Revenue for the quarter climbed about 7 percent, but was offset by lower operating margins. Quarterl earnings missed Wall Street estimates, while revenue surpassed expectations.

The company reaffirmed its earnings guidance for the full year.

Krispy shares dropped about 5 percent in after-hours trade.

The company reported second-quarter net earnings of $5.8 million or $0.08 per share compared with $4.7 million or $0.07 per share last year.

Excluding items, adjusted earnings for the quarter were $0.13 per share compared with $0.14 per share a year ago.

Revenues for the quarter were up 6.9% at $120.5 million compared with $112.7 million in the prior year.

Analysts polled by Thomson Reuters estimated earnings of $0.16 per share on revenues of $118.1 million for the quarter. Analysts' estimates typically exclude special items.

Krispy said that revenues at Company Stores increased 3.8% from a year ago, and same store sales at Company shops rose 1.1% against a gain of 10.5% last year.

Revenues at KK Supply Chain (including sales to Company stores) rose 4%.

The company said operating margins came under pressure during the quarter, but was offset by lower income tax. Also the prior year had debt charges.

Looking ahead to the full year, the company still expects earnings of $0.69 to $0.74 per share, while analysts expect $0.73 per share.

KKD closed Tuesday at $17.61, down $0.06 or 0.34%, on a volume of 1.9 million shares on the NYSE. In after hours, the stock dropped $0.87 or 4.94%.