Dunkin' Brands Group, the parent company of Dunkin' Donuts (DD) and Baskin-Robbins (BR), reported results for the first quarter ended March 28, 2015.
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Dunkin' Donuts U.S. first quarter revenues of $133.9 million represented an increase of 6.9 percent year-over the prior year period.
The increase was primarily a result of increased royalty income, due to an increase in systemwide sales, as well as increases in franchise fees and rental income.
Dunkin' Donuts U.S. segment profit in the first quarter increased $3.6 million over the prior year period to $93.4 million, which was driven primarily by revenue growth, offset by a decrease in other operating revenue as the prior year period included income recognized in connection with the sale of real estate.
Dunkin' Donuts International first quarter systemwide sales decreased 0.3 percent from the prior year period. A decline in sales in South Korea was offset by sales growth in Asia and the Middle East. Sales in Europe, South America, and South Korea were negatively impacted by unfavorable foreign exchange rates. On a constant currency basis, systemwide sales increased by approximately 5 percent.
Dunkin' Donuts International first quarter revenues of $6.6 million represented an increase of 53.5% over the prior period. The increase in revenues was primarily a result of a settlement reached with a master licensee resulting in the recovery of prior period royalty income and franchise fees.
Segment profit for Dunkin' Donuts International increased $1.4 million to $4.3 million in the first quarter primarily as a result revenue growth offset by increases in general and administrative expenses.
Baskin-Robbins U.S. first quarter revenue increased 8.2 percent from the prior year period to $9.9 million due primarily to increased royalty income, as well as other revenues driven by an increase in licensing income from the sale of ice cream.
Segment profit for Baskin-Robbins U.S. increased $1.1 million in the first quarter, or 22.6 percent, over the prior year period primarily as a result of the increase in revenues, as well as a decrease in general and administrative expenses primarily due to higher expenses that were incurred in the prior year period related to advertising and other brand-building activities.
Baskin-Robbins International systemwide sales decreased 1.2 percent in the first quarter compared to the prior year period driven by unfavorable foreign exchange in Japan, and sales declines in Europe, offset by increases in sales in the Middle East and South Korea. On a constant currency basis, systemwide sales increased by approximately 5 percent.
Baskin-Robbins International first quarter revenues decreased 21.5 percent over the prior year period to $23.6 million due primarily to decreases in sales of ice cream products in the Middle East and Australia driven primarily by timing of orders, as well as decreases in royalty income and franchise fees.
First quarter segment profit decreased 16.1 percent over the prior year period to $8 million, as a result of a decrease in net margin on ice cream driven by the decrease in sales, as well as the decreases in royalty income and franchise fees, offset by reserves on outstanding receivables recorded in the prior year period.
The board declared a second quarter cash dividend of $0.265 per share, payable on June 17, 2015 to shareholders of record as of the close of business on June 9, 2015. ■