Convenience store operator Pantry Inc's fourth-quarter earnings handily beat Wall Street estimates aided by a 28 percent fall in operating expenses, sending shares up 7 percent.
For the fourth quarter ended Sept. 24, the company posted a net profit of $13.3 million, or 60 cents a share, compared with $22.9 million, or $1.03, a year ago.
Total revenue fell 28 percent to $1.82 billion.
Analysts on average were expecting the company to earn 39 cents, before special items, on revenue of $1.81 billion, according to Thomson Reuters I/B/E/S.
For 2010, the company, which operates stores under banners like Kangaroo Express, expects merchandise sales of between $1.76 billion to $1.82 billion and merchandise gross margin of 33 percent to 34.5 percent.
The company reported merchandise gross margin of 35.4 percent for 2009.
Shares of the Cary, North Carolina-based company were trading up 7 percent at $16.00 in morning trade on Nasdaq.
(Reporting by Abhishek Takle in Bangalore; Editing by Anthony Kurian)