Dunkin’s First Earnings Call

New items boost traffic, check averages; sights set on D.C.

New items boost traffic, check averages; sights set on D.C.

CANTON, Mass. -- A formidable player in the competitive coffee category, Dunkin’ Brands yesterday held its first earnings call since its initial public offering in July. Net income dropped 61% in the third quarter due to charges related to going public and paying down debt. But without the one-time charges, company officials say it would have risen 32%. Dunkin’ Brands is the parent company of Dunkin’ Donuts and Baskin-Robbins.

During the call, CEO Nigel Travis attributed an increase in both traffic and check averages to new breakfast and lunch sandwiches such as the Big ‘N Toasty as well as new drinks such as frozen lemonade and iced tea. Traditional advertising, the company’s first movie promotion (“Captain America: The First Avenger”) and social-media efforts on Facebook and Foursquare also helped boost traffic.

"As a result of our successful product innovation, powerful marketing and an intense focus on guest satisfaction and operational execution, we delivered robust third-quarter results," said Travis. "Our strong increases in systemwide sales and consolidated U.S. comparable store sales ... reflect the strength of our overall business and underscore the opportunity we have to accelerate our profitable growth in the U.S. and around the world."

Meanwhile, Dunkin’ Donuts recently announced it is planning to open dozens of new stores throughout the Washington, D.C., area by the end of the decade. Company officials announced last week that 86 new stores are expected to be opened in Washington, D.C., Maryland and Virginia by 2020.There are currently 125 Dunkin’ Donuts locations in the Washington area.

Fifteen development agreements were signed over the past year that will deliver 64 new restaurants, in addition to 22 restaurants that were previously contracted.

"Washington, D.C., has been a priority growth market for Dunkin' Donuts and these 15 agreements have essentially sold out Dunkin' Donuts development opportunities in the Washington D.C. Metropolitan area," said Grant Benson, CFE, vice president of franchising and market planning, Dunkin' Brands Inc. "These deals represent a 50% increase in rooftops from the 125 restaurants in the market right now.”