Krispy Kreme Records Rise In Net Revenue For Quarter That Ended On July 4
Krispy Kreme Inc has recorded a rise in net revenue for the quarter that ended on July 4 and forecast stronger annual revenue after beating second-quarter estimates, betting on its online business, drive-through and new menu items to soften any hit from the COVID-19 Delta variant.
Shares Rise And Price Raises
The donut maker's shares rose 2% in extended trading after its first earnings report since returning as a listed company in July. The company also said that it is planning to raise prices in September to offset higher labour and commodity costs.
Doubled Down On Online Businesses
Major US restaurants including McDonald's Corp and Starbucks have doubled down on their online businesses to cut wait times for delivery and drive-through, hoping that the lockdown-driven shift to eating at home more is here to stay.
Krispy Kreme CEO Statements
With the highly contagious Delta COVID-19 variant driving a resurgence in cases worldwide, using multiple channels for delivery is key, Krispy Kreme CEO Mike Tattersfield told Reuters in a call.
"You could be closing down your front door but using your drive-through or using your e-commerce model or using your 'Delivered Fresh Daily' model in the grocery business," he said.
Net Revenue Forecast
The "Original Glazed" donut maker forecast annual net revenue of between $1.34 billion and $1.38 billion, as much as 23% higher than last year and compared with Refinitiv IBES estimates of $1.34 billion.
Easing Of Curbs And New Menu Items
Across the sector, the easing of coronavirus curbs, reopening of offices and new menu items have allowed chains like Starbucks, McDonald's and Wendy's Co to serve up strong forecasts.
Krispy Kreme has also added new items including donuts dipped in Hershey Co's chocolate icing to draw in returning customers.
Cash Dividend Expectation
It is expecting to pay a cash dividend of 3.5 cents per share for the quarter ending October 3, the company said.
Net Revenue Figures
Net revenue rose 42.6% to $349.2 million in the second quarter ended July 4 versus estimates of $333.4 million.
Earning Per Share
Excluding items, it earned 13 cents per share, a cent below expectations.