Wednesday, August 3, 2011

Low profit for Dunkin' Brands

 Dunkin’ Brands Group Inc., the Canton-based parent company of the Dunkin’ Donuts and Baskin-Robbins chains, said its second-quarter net income was $17.2 million compared with $17.3 million for the second quarter of 2010.

The company said its current emphasis is on “operational excellence” and expansion.

Global system-wide sales for the second quarter rose 6.9 percent from a year ago, the company said in a press release. And same-store sales, an important retail metric that measures sales at stores open at least a year, were up 3.2 percent at the company’s US stores.

Second-quarter revenues that went to the parent company were $157 million, up from $150.4 million a year ago, Dunkin’ Brands said.

Last week, Dunkin’ Brands sold a piece of the company in an initial public stock offering. On the first day of trading, shares soared 46 percent above the initial public offering price. On that first day of trading, shares closed at $27.85, up from the $19 IPO price, and the company sold 22.3 million shares raising $422.8 million. A trio of private equity firms - Bain Capital Partners, Thomas H. Lee Partners of Boston, and Carlyle Group of Washington, D.C. - bought Dunkin’ for $2.4 billion six years ago. Each of the firms retains a 26.1 percent controlling interest in Dunkin’ Brands. (To read a Globe story about Dunkin’s IPO, please click here.)

Today’s press release included a statement from Neil Moses, Dunkin’s chief financial officer.

“Since the first of the year, we have significantly increased the strength of our balance sheet, and after the completion of our initial public offering, have reduced our annual interest expense by 50 percent to approximately $60 million through a combination of debt retirement, restructuring, and repricing. This financing activity resulted in non-recurring charges which impacted year-to-date net income,” Moses said. “The performance of the business in the second quarter demonstrates the strength of our business model and the integrity of our platform for future growth.”

Dunkin’ Brands added that its franchisees and licensees opened 140 net new Dunkin’ Donuts and Baskin-Robbins locations on a global basis during the quarter, increasing Dunkin’ Brands total points of distribution to 16,427 at the end of the second quarter.

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