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Krispy Kreme Reports Financial Results for the Fourth Quarter and Fiscal Year Ended February 1, 2015

By: Krispy Kreme |  0 Shares     78 Reads

Reaffirms Fiscal 2016 Adjusted EPS Outlook of $0.79 to $0.85

WINSTON-SALEM, N.C. - (BUSINESS WIRE) - Mar. 11, 2015 - Krispy Kreme Doughnuts, Inc. (NYSE:KKD) (the “Company”) today reported financial results for the fourth quarter and fiscal year ended February 1, 2015, and reaffirmed its adjusted EPS outlook for fiscal 2016 (ending January 31, 2016).

Fourth Quarter Fiscal 2015 Highlights Compared to the Year-Ago Period:

• Revenues increased 11.2% to $125.4 million from $112.7 million
• Systemwide store count rose 6.7% in the quarter to 987 Company and franchise shops worldwide
• Systemwide domestic same store sales rose 3.6%, including a 1.7% gain at Company shops; constant-currency international franchise same store sales declined 2.6%
• Adjusted net income rose 36.3% to $11.4 million ($0.17 per share) from $8.3 million ($0.12 per share); adjusted net income and adjusted earnings per share are non-GAAP measures (see the reconciliation of GAAP to adjusted earnings accompanying this release)
• Net income was $6.5 million ($0.10 per share) compared to $14.8 million ($0.21 per share) last year; net income in the prior year quarter included unusual income tax credits totaling $10.3 million ($0.14 per share)
• Cash provided by operating activities was $17.2 million compared to $15.9 million last year

Fiscal 2015 Highlights Compared to Last Year:

• Revenues increased 6.5% to $490.3 million from $460.3 million
• Systemwide store count rose 19.2% during the year to 987 Company and franchise shops worldwide
• Systemwide domestic same store sales rose 3.1%, including a 1.2% gain at Company shops; constant-currency international franchise same store sales declined 2.6%
• Adjusted net income rose 11.6% to $48.3 million ($0.70 per share) from $43.2 million ($0.61 per share)
• Net income was $30.1 million ($0.44 per share) compared to $34.3 million ($0.48 per share) last year; net income in the prior year reflected unusual income tax credits totaling $10.3 million ($0.14 per share)
• Cash provided by operating activities was $62.9 million compared to $56.9 million in fiscal 2014
• The Company repurchased 2.2 million of its common shares for $39.2 million; $43.4 million remains under the current share repurchase authorization

President and Chief Executive Officer Tony Thompson commented: “We are pleased with the Company’s continuing momentum in fiscal 2015. This past year, we increased adjusted net income by nearly 12%, significantly outpacing our almost 7% revenue growth, and completed our sixth consecutive year of positive same-store sales at Company stores. Systemwide unit count increased over 19%, positioning Krispy Kreme as one of the fastest growing chains within the QSR industry. We are growing again in a disciplined and sustainable manner with a variety of shop formats designed to meet individual market needs. We continue to refine and improve our model to better meet consumer needs and deliver outstanding financial returns.”

Thompson continued: “In the fourth quarter, we scaled back our promotional incentive activities, which had a positive effect on Company shop operating margins. We also achieved two significant development milestones – eight Company store openings in a single quarter, which is more than we have opened annually in any each year since 2005, and a record 57 international franchise store openings in 13 countries.”

Thompson concluded: “Realizing our vision for the Krispy Kreme brand is predicated on four key business drivers: accelerating global growth; leveraging technology; enhancing our core menu; and maximizing brand awareness. We are executing across all of these areas with the underlying goals of spreading the joy of Krispy Kreme and positioning ourselves for further value creation for our shareholders. Fiscal 2016 began with another important milestone, our 1,000th store worldwide celebration, which is a great way to start what we believe will be another year of sustainable growth at Krispy Kreme.”

Results for the Quarter Ended February 1, 2015

Consolidated Results

For the quarter ended February 1, 2015, revenues rose 11.2% to $125.4 million.

Direct operating expenses increased to $102.3 million from $93.3 million, but as a percentage of total revenues declined to 81.6% from 82.8%.

General and administrative expenses were $9.2 million (7.4% of revenues) compared to $7.7 million (6.8% of revenues) in the year-ago period. General and administrative expenses in fiscal 2015 include a $2.5 million charge for the settlement of amounts due under an employment agreement with the Company’s former chief executive officer. A reduction in share-based compensation costs due principally to a change in the timing of equity awards was partially offset by higher provisions for incentive compensation.

Operating income rose 5.4% to $9.6 million ($12.0 million exclusive of the $2.5 million contract settlement charge in fiscal 2015, or 32.6% over the fourth quarter last year).

Adjusted net income rose 36.3% to $11.4 million ($0.17 per share) compared to $8.3 million ($0.12 per share), in the fourth quarter last year. Adjusted net income and adjusted EPS are non-GAAP measures (see the reconciliation of GAAP to adjusted earnings accompanying this release).

Segment Results

For the quarter ended February 1, 2015, Company Stores revenues increased 12.7% to $83.7 million, while same store sales rose 1.7%. The Company Stores segment posted operating income of $1.4 million compared to $1.6 million last year. The Company opened eight new factory shops in the fourth quarter. Preopening and other start-up costs related to new shops, including shops not yet opened, were approximately $1.3 million in the fourth quarter of fiscal 2015 compared to approximately $150,000 in the fourth quarter last year. The segment’s results for the fourth quarter of fiscal 2015 also reflect charges of approximately $1.0 million for mark-to-market adjustments on wholesale gasoline futures contracts entered into in the fourth quarter to hedge the cost of fuel purchases for fiscal 2016 and 2017. The Company has not designated these derivative contacts as cash flow hedges and, accordingly, changes in their fair values are reflected in earnings as they occur. While a decline in gasoline prices resulted in the fourth quarter mark-to-market charge, significantly lower gasoline prices are expected to benefit fiscal 2016 operating costs and are reflected in management’s earnings outlook.

Domestic Franchise revenues increased 7.6% to $3.4 million, while same store sales rose 4.7%. Domestic Franchise segment operating income was $2.1 million compared to $2.0 million last year.

International Franchise revenues increased 10.6% to $7.6 million, driven by higher royalties and a net 53 shop openings in the quarter. Sales by international franchise shops rose 9.0% to $128 million (16.2% excluding the effects of foreign exchange rate changes), while constant currency same store sales fell 2.6%. International Franchise segment operating income was $5.6 million compared to $4.8 million in the fourth quarter last year.

KK Supply Chain revenues (including sales to Company stores) increased 13.2% to $63.3 million. KK Supply Chain generated operating income of $11.1 million compared to $8.6 million in the fourth quarter last year.

Fiscal 2016 Outlook

Management is reaffirming its outlook for adjusted net income for fiscal 2016 of between $55 million and $59 million ($0.79 to $0.85 per share), compared to $48.3 million ($0.70 per share) in fiscal 2015.

The Company’s outlook reflects, among other things, the following assumptions:

• 10 to 15 net new Company shops
• 10 to 20 net new domestic franchise shops
• 95 to 110 net new international franchise shops
• Capital expenditures of between $35 million and $45 million including ongoing investments in technology
• Continued growth in domestic same store sales
• A reduction in agricultural commodity and fuel costs compared to fiscal 2015
• Negative effects of a stronger U.S. dollar

Conference Call

The Company will host a conference call to review fiscal 2015 fourth quarter and annual results, as well as management’s outlook for fiscal 2016, this afternoon at 4:30 p.m. (ET). A live webcast of the conference call will be available at www.krispykreme.com. The conference call also can be accessed over the phone by dialing (877) 407-0784 or, for international callers, by dialing (201) 689-8560. An archived replay of the call will be available shortly after its conclusion by dialing (877) 870-5176, or (858) 384-5517 for international callers; the passcode is 13601290. The audio replay will be available through March 18, 2015. A transcript of the conference call will be available on the Company’s website.

About Krispy Kreme

Krispy Kreme is a leading branded specialty retailer and wholesaler of premium quality sweet treats and complementary products, including its signature Original Glazed® doughnut. Headquartered in Winston-Salem, N.C., the Company has offered the highest quality doughnuts and great tasting coffee since it was founded in 1937. Today, there are over 980 Krispy Kreme shops in more than 20 countries around the world. Connect with Krispy Kreme at www.krispykreme.com.

Information contained in this press release, other than historical information, should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management’s beliefs, assumptions and expectations of our future economic performance, considering the information currently available to management. These statements are not statements of historical fact. Forward-looking statements involve risks and uncertainties that may cause our actual results, performance or financial condition to differ materially from the expectations of future results, performance or financial condition we express or imply in any forward-looking statements. The words “believe,” “may,” “forecast,” “could,” “will,” “should,” “would,” “anticipate,” “estimate,” “expect,” “intend,” “objective,” “seek,” “strive” or similar words, or the negative of these words, identify forward-looking statements. Factors that could contribute to these differences include, but are not limited to: the quality of Company and franchise store operations; our ability, and our dependence on the ability of our franchisees, to execute on our and their business plans; our relationships with our franchisees; our ability to implement our domestic and international growth strategy; our ability to implement our domestic small shop operating model; political, economic, currency and other risks associated with our international operations; the price and availability of raw materials needed to produce doughnut mixes and other ingredients, and the price of motor fuel; our relationships with wholesale customers; our ability to protect our trademarks and trade secrets; changes in customer preferences and perceptions; risks related to the food service industry, including food safety and protection of personal information; compliance with government regulations relating to food products and franchising; increased costs or other effects of new government regulations relating to healthcare benefits; and risks associated with implementation of new technology platforms. These and other risks and uncertainties, which are described in more detail in the Company’s most recent Annual Report on Form 10-K and other reports and statements filed with the United States Securities and Exchange Commission, are difficult to predict, involve uncertainties that may materially affect actual results and may be beyond the Company’s control, and could cause actual results, performance or achievements to be materially different from those expressed or implied by any of these forward-looking statements. New factors emerge from time to time, and it is not possible for management to predict all such factors or to assess the impact of each such factor on the Company. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made.

KRISPY KREME DOUGHNUTS, INC.
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
				Three Months Ended								Year Ended
				February 1,				February 2,				February 1,				February 2,
				2015				2014				2015				2014
				(In thousands, except per share amounts)
Revenues				$	125,367			$	112,746			$	490,334			$	460,331
Operating expenses:
	Direct operating expenses (exclusive of depreciation and
		amortization expense shown below)			102,323				93,302				399,744				376,132
	General and administrative expenses				9,221				7,709				28,558				25,149
	Depreciation and amortization expense				3,354				2,834				12,840				11,106
	Impairment charges and lease termination costs				905				(169	)			955				1,374
Operating income					9,564				9,070				48,237				46,570
Interest income					109				144				406				616
Interest expense					(321	)			(135	)			(856	)			(1,057	)
Loss on retirement of debt					-				-				-				(967	)
Equity in losses of equity method franchisees					53				(47	)			(118	)			(221	)
Other non-operating income and (expense), net					136				96				547				119
Income before income taxes					9,541				9,128				48,216				45,060
Provision for income taxes					2,995				(5,632	)			18,156				10,804
Net income				$	6,546			$	14,760			$	30,060			$	34,256
Earnings per common share:
	Basic			$	0.10			$	0.22			$	0.45			$	0.51
	Diluted			$	0.10			$	0.21			$	0.44			$	0.48
Weighted average shares outstanding:
	Basic				66,503				67,222				66,360				67,261
	Diluted				68,590				71,045				68,929				71,054

 

KRISPY KREME DOUGHNUTS, INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
				February 1,				February 2,
				2015				2014
				(In thousands)
	ASSETS
CURRENT ASSETS:
Cash and cash equivalents				$	50,971			$	55,748
Receivables					27,799				25,268
Receivables from equity method franchisees					782				675
Inventories					18,194				16,750
Deferred income taxes					23,245				23,847
Other current assets					6,856				5,199
	Total current assets				127,847				127,487
Property and equipment					115,758				92,823
Investments in equity method franchisees					-				-
Goodwill and other intangible assets					30,070				24,097
Deferred income taxes					68,278				83,461
Other assets					10,760				10,678
	Total assets			$	352,713			$	338,546
	LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Current portion of lease obligations				$	333			$	344
Accounts payable					17,095				16,788
Accrued liabilities					32,530				29,276
	Total current liabilities				49,958				46,408
Lease obligations, less current portion					9,354				1,659
Other long-term obligations and deferred credits					25,615				25,386
Commitments and contingencies
SHAREHOLDERS’ EQUITY:
Preferred stock, no par value					-				-
Common stock, no par value					310,768				338,135
Accumulated other comprehensive income					-				-
Accumulated deficit					(42,982	)			(73,042	)
	Total shareholders’ equity				267,786				265,093
		Total liabilities and shareholders’ equity		$	352,713			$	338,546

 

KRISPY KREME DOUGHNUTS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
						Year Ended
						February 1,				February 2,
						2015				2014
							(In thousands)
CASH FLOW FROM OPERATING ACTIVITIES:
Net income						$	30,060			$	34,256
Adjustments to reconcile net income to net cash provided by operating activities:
	Depreciation and amortization expense						12,840				11,106
	Deferred income taxes						15,729				8,014
	Impairment charges						901				-
	Accrued rent expense						789				784
	Loss on retirement of debt						-				967
	(Gain) loss on disposal of property and equipment						238				(1,879	)
	(Gain) on refranchising						(1,247	)			(876	)
	Share-based compensation						4,466				6,452
	Provision for doubtful accounts						90				(345	)
	Amortization of deferred financing costs						108				285
	Equity in losses of equity method franchisees						118				221
	Unrealized losses on commodity derivative positions						1,498				298
	Other						23				27
	Change in assets and liabilities:
		Receivables					(3,962	)			556
		Inventories					(1,343	)			(4,553	)
		Other current and non-current assets					(2,358	)			1,917
		Accounts payable and accrued liabilities					4,867				(1,913	)
		Other long-term obligations and deferred credits					57				1,595
			Net cash provided by operating activities				62,874				56,912
CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of property and equipment							(31,447	)			(23,419	)
Proceeds from disposals of property and equipment							2,341				1,719
Proceeds from refranchising							1,847				681
Acquisition of stores from franchisees							(7,152	)			(1,603	)
Other investing activities							766				456
			Net cash used for investing activities				(33,645	)			(22,166	)
CASH FLOW FROM FINANCING ACTIVITIES:
Repayment of long-term debt and lease obligations							(384	)			(24,658	)
Deferred financing costs							-				(132	)
Proceeds from exercise of stock options							10,259				2,517
Repurchase of common shares							(43,881	)			(23,057	)
			Net cash used for financing activities				(34,006	)			(45,330	)
Net decrease in cash and cash equivalents							(4,777	)			(10,584	)
Cash and cash equivalents at beginning of year							55,748				66,332
Cash and cash equivalents at end of year						$	50,971			$	55,748
Supplemental schedule of non-cash investing and financing activities:
		Assets acquired under leasing arrangements				$	8,045			$	918

KRISPY KREME DOUGHNUTS, INC.

NON-GAAP FINANCIAL INFORMATION

(Unaudited)

As of February 1, 2015, the Company had net deferred income tax assets of approximately $92 million, of which approximately $44 million related to federal and state net operating loss carryovers. The Company’s federal net operating loss carryovers totaled approximately $159 million.

The Company has reported cumulative pretax income of over $160 million since the beginning of fiscal 2010, and the Company also has generated significant taxable income during this period. However, because of the Company’s utilization of its federal and state net operating loss carryovers and other deferred tax assets, the Company’s cash payments for income taxes have been relatively insignificant during this period. As a result, the provision for income tax expense has substantially exceeded cash payments for income taxes. Until such time as the Company’s net operating loss carryovers are exhausted or expire, GAAP income tax expense is expected to continue to substantially exceed the amount of cash income taxes payable by the Company.

The Company recorded a pretax charge of approximately $2.5 million in the fourth quarter of fiscal 2015 for the settlement of amounts due under an employment agreement with the Company’s former chief executive officer. That officer, who was most recently the Company’s Executive Chairman, transitioned from that role to the non-employee role of non-executive chairman of the board of directors in late January 2015. In the second quarter of fiscal 2014, the Company recorded a charge of $1.0 million related to the retirement of its secured credit facilities, consisting principally of the writeoff of deferred financing costs related to the Company’s term loan, which was retired in full, and the termination of an interest rate hedge related to the term loan. Charges of this nature are not expected to recur on a regular basis.

The following non-GAAP financial information and related reconciliation of adjusted net income to GAAP net income are provided to assist the reader in understanding the effects of the above facts and transactions on the Company’s results of operations. In addition, the non-GAAP financial information is intended to illustrate the material difference between the Company’s income tax expense and income taxes currently payable. These non-GAAP performance measures are consistent with other measurements made by management in the operation of the business which do not consider income taxes except to the extent to which those taxes currently are payable, for example, capital allocation decisions and incentive compensation measurements that are made on a pretax basis.

			Management's						Historical Periods
			Earnings Outlook						Three Months Ended							Year Ended
			Year Ending January 31, 2016						February 1,			February 2,				February 1,			February 2,
			From			To			2015			2014				2015			2014
			(In thousands, except per share amounts)
Net income, as reported			$	34,800		$	37,200		$	6,546		$	14,760			$	30,060		$	34,256
Charge for settlement of employment
	contract			-			-			2,464			-				2,464			-
Loss on retirement of debt				-			-			-			-				-			967
Provision for deferred income taxes				20,200			21,800			2,348			(6,424	)			15,729			8,014
Adjusted net income			$	55,000		$	59,000		$	11,358		$	8,336			$	48,253		$	43,237
Adjusted earnings per common share:
	Basic		$	0.82		$	0.88		$	0.17		$	0.12			$	0.73		$	0.64
	Diluted		$	0.79		$	0.85		$	0.17		$	0.12			$	0.70		$	0.61
Weighted average shares outstanding:
	Basic			66,800			66,800			66,503			67,222				66,360			67,261
	Diluted			69,500			69,500			68,590			71,045				68,929			71,054

 

KRISPY KREME DOUGHNUTS, INC.
SEGMENT INFORMATION
(Unaudited)
							Three Months Ended								Year Ended
							February 1,				February 2,				February 1,				February 2,
							2015				2014				2015				2014
							(In thousands)
Revenues:
	Company Stores:
		On-premises sales:
			Retail sales				$	42,235			$	34,590			$	151,956			$	136,921
			Fundraising sales					2,829				2,782				15,406				14,591
				Total on-premises sales				45,064				37,372				167,362				151,512
		Wholesale sales						38,680				36,957				157,944				155,313
					Company Stores revenues			83,744				74,329				325,306				306,825
	Domestic Franchise							3,381				3,143				13,450				11,839
	International Franchise							7,631				6,900				28,598				25,607
	KK Supply Chain:
		Total revenues						63,292				55,913				244,688				231,229
		Less – intersegment sales elimination						(32,681	)			(27,539	)			(121,708	)			(115,169	)
			External KK Supply Chain revenues					30,611				28,374				122,980				116,060
					Total revenues		$	125,367			$	112,746			$	490,334			$	460,331
Operating income:
	Company Stores						$	1,377			$	1,631			$	9,287			$	11,334
	Domestic Franchise							2,058				1,962				8,103				8,083
	International Franchise							5,587				4,758				20,026				17,977
	KK Supply Chain							11,051				8,617				41,823				36,953
		Total segment operating income						20,073				16,968				79,239				74,347
	General and administrative expenses							(9,221	)			(7,709	)			(28,558	)			(25,149	)
	Corporate depreciation and amortization expense							(383	)			(358	)			(1,489	)			(1,254	)
	Impairment charges and lease termination costs							(905	)			169				(955	)			(1,374	)
		Consolidated operating income					$	9,564			$	9,070			$	48,237			$	46,570
Depreciation and amortization expense:
	Company Stores						$	2,782			$	2,256			$	10,534			$	9,039
	Domestic Franchise							14				47				135				119
	International Franchise							1				1				5				7
	KK Supply Chain							174				172				677				687
	Corporate							383				358				1,489				1,254
		Total depreciation and amortization expense					$	3,354			$	2,834			$	12,840			$	11,106

 

KRISPY KREME DOUGHNUTS, INC.
SELECTED OPERATING STATISTICS
(Unaudited)
							February 1,					November 2,					August 3,					May 4,
							2015					2014					2014					2014
Systemwide Store Count:
	Company stores							111					104					103					97
	Domestic Franchise stores							167					165					160					163
	International Franchise stores							709					656					621					595
								987					925					884					855
							Three Months Ended										Year Ended
							February 1,					February 2,					February 1,					February 2,
							2015					2014					2015					2014
Systemwide sales (in thousands):(1)
	Company stores						$	83,037				$	73,732				$	322,521				$	303,973
	Domestic Franchise stores							83,496					80,537					337,072					317,864
	International Franchise stores							127,550					116,974					476,364					438,027
	International Franchise stores, in constant dollars(2)							127,550					109,729					476,364					428,950
Change in same store sales (on-premises sales only):(3)
	Company stores							1.7		%			2.4		%			1.2		%			7.4		%
	Domestic Franchise stores							4.7					7.0					4.2					10.4
	International Franchise stores							(8.1	)				(6.5	)				(4.6	)				(8.0	)
	International Franchise stores, in constant dollars(2)							(2.6	)				(0.8	)				(2.6	)				(3.3	)
Company Stores - change in same store sales attributable to:
	Retail menu pricing							1.7		%			3.7		%			1.9		%			3.4		%
	Guest check average (exclusive of menu of pricing)							1.7					(1.7	)				(0.9	)				(0.9	)
	Customer count							(1.2	)				0.4					0.1					4.7
	Fundraising pricing							0.5					-					0.6					-
	Other							(1.0	)				-					(0.5	)				0.2
		Total						1.7		%			2.4		%			1.2		%			7.4		%
Change in Same Store Customer Count - Company stores (retail sales only)(3)								(1.3	)	%			0.5		%			0.1		%			5.3		%
Average guest check - Company stores (retail sales only)							$	7.66				$	7.32				$	7.56				$	7.47
Company Stores - store operating weeks								1,415					1,215					5,284					4,864
Wholesale Metrics - Company Stores:(4)
	Grocers/mass merchants:
		Change in average weekly number of doors						3.5		%			(6.4	)	%			1.5		%			(6.2	)	%
		Change in average weekly sales per door						-					3.4					(0.3	)				9.7
	Convenience stores:
		Change in average weekly number of doors						0.2		%			(0.1	)	%			2.5		%			(0.3	)	%
		Change in average weekly sales per door						0.8					(2.8	)				(2.0	)				3.2

(1) Systemwide sales, a non-GAAP financial measure, include sales by both Company and franchise Krispy Kreme stores. The Company believes systemwide sales data are useful in assessing consumer demand for the Company’s products, the overall success of the Krispy Kreme brand and, ultimately, the performance of the Company. All of the Company’s royalty revenues are computed as percentages of sales made by the Company’s domestic and international franchisees, and substantially all of KK Supply Chain’s external sales of doughnut mixes and other ingredients ultimately are determined by demand for the Company’s products at franchise stores. Accordingly, sales by the Company’s franchisees have a direct effect on the Company’s royalty and KK Supply Chain revenues, and therefore on the Company’s profitability. The Company’s consolidated financial statements appearing elsewhere herein include sales by Company stores, sales to franchisees by the KK Supply Chain business segment, and royalties and fees received from franchise stores based on their sales, but exclude sales by franchise stores to their customers.

(2) Computed on a pro forma basis assuming the average rate of exchange between the U.S. dollar and each of the foreign currencies in which the Company’s international franchisees conduct business had been the same in the comparable prior year period.

(3) The change in “same store sales” represents the aggregate on-premises sales (including fundraising sales) during the current year period for all stores which had been open for more than 78 consecutive weeks during the current year period (but only to the extent such sales occurred in the 79th or later week of each store’s operation) divided by the aggregate on-premises sales of such stores for the comparable weeks in the preceding year period. Once a store has been open for at least 79 consecutive weeks, its sales are included in the computation of same stores sales for all subsequent periods. In the event a store is closed temporarily (for example, for remodeling) and has no sales during one or more weeks, such store’s sales for the comparable weeks during the earlier or subsequent period are excluded from the same store sales computation. The change in “same store customer count” is similarly computed, but is based upon the number of retail transactions reported in the Company’s point-of-sale system.

(4) For Company wholesale sales, “average weekly number of doors” represents the average number of customer locations to which product deliveries are made during a week by Company Stores, and “average weekly sales per door” represents the average weekly sales to each such location by Company Stores.

KRISPY KREME DOUGHNUTS, INC.
STORE COUNT
(Unaudited)
		Number of Company Stores
		Factory
		Stores			Hot Shops			Fresh Shops		Total
Three months ended February 1, 2015
November 2, 2014		83			20			1		104
Opened		8			-			-		8
Closed		-			(1	)		-		(1	)
Change in store type		1			(1	)		-		-
February 1, 2015		92			18			1		111
Year ended February 1, 2015
February 2, 2014		76			18			1		95
Opened		13			-			-		13
Closed		-			(1	)		-		(1	)
Change in store type		2			(2	)		-		-
Transferred to Domestic Franchise		(1	)		-			-		(1	)
Transferred from Domestic Franchise		2			3			-		5
February 1, 2015		92			18			1		111
Three months ended February 2, 2014
November 3, 2013		75			18			1		94
Opened		1			-			-		1
Closed		-			-			-		-
February 2, 2014		76			18			1		95
Year ended February 2, 2014
February 3, 2013		76			20			1		97
Opened		6			-			-		6
Closed		(1	)		(1	)		-		(2	)
Change in store type		1			(1	)		-		-
Transferred to Domestic Franchise		(6	)		-			-		(6	)
February 2, 2014		76			18			1		95

 

KRISPY KREME DOUGHNUTS, INC.
STORE COUNT
(Unaudited)
		Number of Domestic Franchise Stores
		Factory
		Stores		Hot Shops		Fresh Shops		Total
Three months ended February 1, 2015
November 2, 2014		113		39		13		165
Opened		3		-		-		3
Closed		-		-		(1)		(1)
February 1, 2015		116		39		12		167
Year ended February 1, 2015
February 2, 2014		107		37		15		159
Opened		10		5		-		15
Closed		-		-		(3)		(3)
Transferred from Company Stores		1		-		-		1
Transferred to Company Stores		(2)		(3)		-		(5)
February 1, 2015		116		39		12		167
Three months ended February 2, 2014
November 3, 2013		106		35		14		155
Opened		1		2		1		4
Closed		-		-		-		-
February 2, 2014		107		37		15		159
Year ended February 2, 2014
February 3, 2013		99		29		14		142
Opened		2		8		1		11
Closed		-		-		-		-
Transferred from Company stores		6		-		-		6
February 2, 2014		107		37		15		159

 

KRISPY KREME DOUGHNUTS, INC.
STORE COUNT
(Unaudited)
		Number of International Franchise Stores
		Factory
		Stores		Hot Shops		Fresh Shops		Kiosks		Total
Three months ended February 1, 2015
November 2, 2014		133		9		348		166		656
Opened		3		1		32		21		57
Closed		-		-		(2)		(2)		(4)
Change in store type		(3)		(1)		3		1		-
February 1, 2015		133		9		381		186		709
Year ended February 1, 2015
February 2, 2014		125		9		296		144		574
Opened		15		1		89		46		151
Closed		(4)		-		(7)		(5)		(16)
Change in store type		(3)		(1)		3		1		-
February 1, 2015		133		9		381		186		709
Three months ended February 2, 2014
November 3, 2013		123		9		287		144		563
Opened		6		-		15		5		26
Closed		(3)		-		(7)		(5)		(15)
Change in store type		(1)		-		1		-		-
February 2, 2014		125		9		296		144		574
Year ended February 2, 2014
February 3, 2013		120		9		257		123		509
Opened		15		-		53		28		96
Closed		(8)		-		(17)		(6)		(31)
Change in store type		(2)		-		3		(1)		-
February 2, 2014		125		9		296		144		574

SOURCE Krispy Kreme Doughnuts, Inc.

Contacts:

Lafeea Watson
Krispy Kreme
Media Relations
336-726-8878
lwatson@krispykreme.com

Anita K. Booe
Krispy Kreme
Investor Relations:
336-703-6902
abooe@krispykreme.com

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