Krispy Kreme Reports Weak Revenue, Downbeat Outlook

Krispy Kreme Doughnuts Inc. reported weaker-than-expected revenue growth in the holiday quarter and provided profit projections that fell short of analyst expectations, sending shares down in after-hours trading.

The Winston-Salem, N.C., company projected an adjusted profit of 87 cents to 91 cents a share for the current fiscal year, up from 80 cents a share for the year ended Jan. 31 but below the average estimate of 93 cents a share by analysts surveyed by Thomson Reuters.

Shares, down 25% over the past 12 months, fell 5.1% to $14.60 in after-hours trading.

Krispy Kreme was founded in 1937 by Vernon Carver Rudolph, who arrived in Winston-Salem with $25 in cash and a secret recipe his uncle had bought from a New Orleans chef, according to company lore. Krispy Kreme went public in 2000 and opened its first international store a year later.

The company ended the year with 1,121 stores, with 73.5% of stores located abroad, compared with 73% in the previous quarter and 71.8% a year earlier.

Over all, Krispy Kreme reported a fourth-quarter profit of $8.25 million, or 13 cents a share, compared with $6.55 million, or 10 cents a share, a year earlier. Excluding provision for deferred taxes and other items, profit rose to 22 cents a share from 17 cents a share a year earlier.

Revenue rose 4% to $130.4 million.

Analysts surveyed by Thomson Reuters had projected 21 cents a share on $133 million in revenue.

Sales at domestic stores open at least 18 months rose 1.6%, including a 0.2% increase at company-owned stores. Excluding the impact of currency translation, international sales at established stores fell 7%.

Write to Maria Armental at [e-mail]

(END) Dow Jones Newswires

March 22, 2016 17:45 ET (21:45 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.