Wendy's International, one of the world's largest restaurant chains, announced its second quarter earnings on Thursday, blaming losses on impairment charges for its Baja Fresh Mexican Grill operation.
Posting a net loss of $29.1 million compare to net income of $70.8 million in the second quarter a year ago, the Ohio-based company reported a net loss per share of $0.25 versus the earning per share of $0.61 in the same period last year.
Revenue increased 8 percent to $1.03 billion from $951 million a year ago, with same-store sales slightly moving up 0.7 percent at its U.S. company-owned outlets. Analysts polled by Thomson First Call expected the firm to earn 53 cents a share on revenues of $998.3 million.
Excluding the charges for Baja, the firm would have met expectations, with with a net income of $63.8 million or $0.54 per share.
The firm confirmed that it had eliminated 355 positions, which would account for the majority of the $100 million total savings. A significant number of positions were eliminated through a voluntary early retirement program and normal attrition.
Wendyâ€™s announced in June that its Board of Directors has confirmed its intent to sell the 160 million shares of Tim Hortons in Canada that it currently owns.
For the third quarter, the company anticipates additional costs of between $10 million to $15 million that include expenses related to the spin-off transaction, voluntary early retirement costs, severance expenses and consulting fees.