NPC International: Reports Second Quarter Results

Overland Park / KS. (npc) NPC International Inc. reported financial results for its second fiscal quarter ended June 30, 2015. NPC International 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 five states.

2015 Second Quarter Financial Highlights

• Pizza Hut comparable store sales were flat rolling over a decrease of (5.6) percent last year.
• Wendy’s comparable store sales decreased (0.5) percent in the 87 stores acquired in fiscal 2013.
• Adjusted Ebitda (reconciliation attached) was 29.5MM USD; an increase of 8.6MM USD or 41 percent from the prior year.
• The Company generated net income of 0.1MM USD compared to a net loss of 1.4MM USD last year.

Year-To-Date Results

• Pizza Hut comparable store sales decreased (1.6) percent rolling over a decrease of (5.1) percent last year.
• Wendy’s comparable store sales were flat for the 87 stores acquired in fiscal 2013.
• Adjusted Ebitda (reconciliation attached) was 61.8MM USD; an increase of 11.9MM USD or 24 percent from the prior year.
• Net income was 5.0MM USD, an increase of 3.5MM USD from last year.
• Cash balances were 33.5MM USD, an increase of 21.4MM USD from fiscal year end.
• Our leverage ratio was 4.76X Consolidated Ebitda, net of allowable cash balances

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 percent increase in Ebitda during the second quarter over the prior year. In addition, our cash balances grew by 21.4 million USD from fiscal year end due to increased Ebitda and a 25 percent 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 nine re-images and three refreshes this year with three re-images 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».

About

The Company is a wholly owned subsidiary of NPC Restaurant Holdings LLC, which has guaranteed the Company’s 10.50 percent 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 (Imgage Source: The Wendy’s Company).