=Wendy's (WEN) reported earnings on Wed 9 Aug 2017 (b/o)

Wendy's misses by $0.14, beats on revs; Reaffirms 2017 EPS SSS and EPS guidance; Reaffirms 2020 targets

• Reports Q2 (Jun) loss of $0.01 per share, excluding non-recurring items, $0.14 worse thanthe Capital IQ Consensus of $0.13; revenues fell 16.3% year/year to $320.34 mln vs the $301.4 mln Capital IQ Consensus.
• During 2017, the Company now expects:
  • Commodity cost inflation of approximately 3 to 4 percent compared to 2016.
  • Company-operated restaurant margin of approximately 18.0 to 18.5 percent.
  • Net franchise rental income of approximately $100 to $105 million.
  • Adjusted EBITDA of approximately $404 to $410 million, an increase of approximately 3 to 5 percent compared to 2016
• In addition, the Company continues to expect:
  • Same-restaurant sales growth of approximately 2 to 3 percent for the North America system.
  • Labor inflation of approximately 4 percent.
  • Adjusted earnings per share of approximately $0.45 to $0.47, an increase of approximately 13 percent to 18 percent compared to 2016.
  • Cash flows from operations of approximately $240 to $275 million.
  • Capital expenditures of approximately $80 to $90 million.
  • Free cash flow of approximately $160 to $185 million.
• Company on track to achieve 2020 goals:
  • The Company continues to expect to achieve the following goals by the end of 2020:
  • Global systemwide sales (in constant currency and excluding Venezuela) of ~$12 billion.
  • Global restaurant count of ~7,500. Global Image Activation of at least 70 percent.
  • Adjusted EBITDA margin of 38 to 40 percent.
  • Free cash flow of ~$275 million (capital expenditures of ~$65 million).