Dunkin’ Brands Group Inc reported a better-than-expected 11 percent rise in quarterly revenue, helped by more traffic at its Dunkin’ Donuts outlets and higher licensing fees from sales of its K-Cups coffee pods.
The company has an agreement with JM Smucker Co and Keurig Green Mountain Inc to sell Dunkin’ K-Cups in grocery stores, drugstores and private warehouse stores, as well as on Dunkin’, Smucker and Keurig websites.
Previously, they were sold only in Dunkin’ Donuts restaurants in the United States.
Sales at established U.S. Dunkin’ Donuts outlets, which account for three quarters of overall revenue, were up 2.9 percent in the second quarter ended June 27. Same-store sales at U.S. Baskin-Robbins ice cream shops jumped 3.4 percent.
Analysts on average had expected sales to rise 2.7 percent at Dunkin’ Donuts and 3.3 percent at Baskin-Robbins, according to Consensus Metrix.
The company’s same-store sales in the quarter benefited likely from limited-time Dunkin’ Donuts offers and customer additions through its Perks loyalty program, analysts said.
The limited time offers, which introduced new products such as bacon guacamole flatbread sandwich and Oreo donut on a temporary basis to gauge customer response, have been popular.
The Perks program, launched in January 2014, had 2.8 million members at the end of the first quarter. These members, who tend to download its mobile app, spend relatively more than other customers, the company said.
Net income attributable to Dunkin’ Brands was $42.3 million, or 44 cents per share, in the second quarter ended June 27, compared with $46.2 million, or 43 cents per share, a year earlier.
Excluding items, the company earned 50 cents per share.
Revenue increased to $211.4 million from $190.9 million a year earlier.
Analysts on an average had expected earnings of 48 cents per share on revenue of $203.7 million, according to Thomson Reuters I/B/E/S.
Up to Wednesday’s close, Dunkin’ shares had gained a third of their value this year.
