Krispy Kreme Doughnuts Inc. Earnings Cheat Sheet: Higher-Than-Expected Net Income

Krispy Kreme Doughnuts Inc. (NYSE:KKD) reported net income above Wall Street’s expectations for the third quarter. Krispy Kreme Doughnuts and its subsidiaries are engaged in the sale of doughnuts and related items through company-owned stores.

Investing Insights: Here’s Why Chipotle’s Stock Keeps Winning.

Krispy Kreme Doughnuts Earnings Cheat Sheet for the Third Quarter

Results: Net income for Krispy Kreme Doughnuts Inc. rose to $4.7 million (7 cents per share) vs. $2.4 million (3 cents per share) in the same quarter a year earlier. This marks a rise of 97.4% from the year earlier quarter.

Revenue: Rose 9.4% to $98.7 million from the year earlier quarter.

Actual vs. Wall St. Expectations: KKD beat the mean analyst estimate of 6 cents per share. Analysts were expecting revenue of $99.3 million.

Quoting Management: Chief Executive Officer James H. Morgan commented: “Our third quarter performance reflects continued progress in strengthening our financial condition and realizing our vision for the Krispy Kreme brand. We generated a healthy increase in revenues, recorded our twelfth consecutive quarter of positive same store sales at Company stores, and delivered substantial improvements in both profitability and operating cash flow. Despite economic headwinds and input cost challenges, we now project fiscal 2012 consolidated operating income, exclusive of impairment charges and lease termination costs, of $24 to $26 million, which would represent at least 25% growth over fiscal 2011.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 11.4% to $98 million in the second quarter. The figure rose 13.6% in the first quarter from the year earlier and climbed 5.7% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company beat estimates last quarter after being in line with expectations in the second quarter with net income of 6 cents per share.

Gross margins grew 0.7 percentage point to 13%. The growth seemed to be driven by increased revenue, as the figure rose 9.4% from the year earlier quarter while costs rose 8.5%.

Looking Forward: The average estimate for the fourth quarter is steady at 6 cents a share. Over the past three months, the average estimate for the fiscal year has climbed from 29 cents per to share to 32 cents.

Competitors to Watch: Retail Food Group Limited (NYSE:RFG), Jamba, Inc. (NASDAQ:JMBA), Peet’s Coffee & Tea, Inc. (NASDAQ:PEET), Starbucks Corporation (NASDAQ:SBUX), Tim Hortons (NYSE:THI), Wendy’s (NYSE:WEN), McDonald’s (NYSE:MCD) and Panera Bread Company (NASDAQ:PNRA).

Stock Performance: Shares of KKD were up 9.5% from the previous close.

Investing Insights: Here’s Why Chipotle’s Stock Keeps Winning.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)