Krispy Kreme Posts First Profitable Year Since 2004
WINSTON-SALEM, North Carolina -- Things are looking up for Krispy Kreme Doughnuts Inc., which posted its first profitable year since 2004, the company reported. Net income for fiscal 2011, which ended January 30, was $7.6 million, compared to a loss of $200,000 in fiscal 2010.
However, fiscal 2012 could be trickier, as commodity costs for food preparation and fuel are expected to cost around $14 million more this year. Higher prices will likely offset at least $12 million of the extra expense, according to the company. Prices went up in Krispy Kreme stores last month, and will go up in grocery and convenience stores by the end of April.
The company has an aggressive growth plan in place for fiscal 2012, which includes plans to open five to 10 company stores, five to 15 domestic franchise stores and over 30 international franchise stores.
"We expect growth in same-store sales at domestic stores and hope to see continued improvement in international franchise trends," said Krispy Kreme President and CEO James Morgan, "although international same-store sales comparisons will remain under pressure due to the substantial expansion in recent years."
The company posted a loss of $1.5 million in the fourth quarter of fiscal 2011, but Morgan attributes it to debt refinancing and poor January weather negatively influencing consumer purchasing.