By Ben Fox Rubin and Julie Jargon
Dunkin' Brands Group Inc. said that first-quarter earnings fell
3.5%, blaming bad winter weather for cutting a hole in demand at
its signature doughnuts-and-coffee chain.
"We had a difficult first quarter with our comparable-store
sales growth in the U.S. significantly impacted by severe weather
in the regions of the country where most of our Dunkin' Donuts
restaurants are located," Chief Executive Nigel Travis said.
"However, we remain confident that we will hit our targets for the
full year."
The company backed its full-year adjusted earnings outlook.
The parent company of Dunkin' Donuts and Baskin-Robbins has been
working to expand its doughnut-and-coffee brand westward in the
U.S., improve its performance abroad and stage a turnaround of its
ice cream shops domestically.
Dunkin' will open its first traditional California doughnut shop
by year-end, ahead of its previous expectation of next year, Mr.
Travis told investors on Thursday.
Dunkin' is also trying to speed service at its doughnut shops.
The company is testing new double-sided sandwich-making stations in
Florida and Massachusetts. Rival McDonald's Corp. is also
installing new prep tables in its kitchens to speed up sandwich
preparation.
Earlier this month, the company's Baskin-Robbins brand launched
online ice cream cake ordering and Mr. Travis set a goal of growing
from more than 13 million cakes sold around the world annually
today to 20 million sold annually in the long-term.
Dunkin' reported a profit of $23 million, or 21 cents per share,
down from $23.8 million, or 22 cents per share, a year earlier.
Excluding amortization costs and other items, earnings rose to 33
cents from 29 cents. Revenue increased 6.2% to $171.9 million.
Analysts predicted per-share earnings of 36 cents and revenue of
$172 million.
U.S. same-store sales rose 1.2% at Dunkin' Donuts shops and
increased 0.5% at Baskin-Robbins. International same-store sales
fell 2.4% at Dunkin' Donuts shops and grew 1.4% at Baskin-Robbins
locations.
Write to Ben Fox Rubin at ben.rubin@wsj.com and Julie Jargon at
julie.jargon@wsj.com
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