Jack in the Box (JACK) second quarter results failed to meet Street estimates. The company reported its results Wednesday after the bell with both revenue and earnings disappointing investors. Revenue tumbled 21% to $209.8 million, while operating earnings of $0.80 per share declined 7% over the prior year period. Shares of the fast-food restaurant chain were down nearly 3% during extended hours of trading.
On a consolidated basis, comp-store sales inched down 0.1% due to lower footfalls and muted demand, while company-operated chain’s same-store sales grew 0.9% due to improvement in higher-margin product sales, offset by dwindling transactions.
The hamburger chain’s operating margins saw 300 basis point improvement touching 22.7% due to refranchising-related benefits and premium product sales, offset by an increase in expenses. For the third quarter and full year, the company expects its same-store sales to be nearly flat to up 1%.
Last week, the company entered into a partnership with Grubhub, which would help customers to order Jack’s foods through the Grubhub online platform. This deal is expected to augur well for Jack to expand its geographical presence and improve the top-line.
The company’s board has given the nod last week for an additional $200 million share repurchase program.
Jack’s shares are down nearly 7% so far in this year and more than 10% in the last 12 months.
Last month, Jack’s peer McDonald’s (MCD) reported its first quarter results beating analysts’ estimates, aided by an increase in franchised margin dollars and tax reforms.