UPDATE 2-Papa John's Q1 beats; narrows FY EPS view range

Tue May 4, 2010 6:17pm EDT

* Q1 EPS $0.54 vs est. $0.50

* Sees 2010 EPS of $1.72-$1.87 vs est. $1.87

* Q1 revenue $285.8 mln vs est. $279.8 mln (Recasts; adds details, analyst comment) By Abhishek Takle BANGALORE, May 4 (Reuters) - Papa John's International Inc's (PZZA.O) adjusted first-quarter profit beat Wall Street expectations but the pizza chain narrowed the range of its 2010 profit view.

The company said it now sees earnings per share of $1.72 to $1.87 a share, compared with analyst estimates of $1.87 a share. It had earlier forecast earnings of $1.70 to $1.90 a share.

"I do think they are very likely being conservative...but I don't think the market will like it tomorrow on the open, probably," KeyBanc Capital Markets analyst Brad Ludington said, referring to the company's revised outlook.

The company said it expects aggressive pricing and the promotional environment in the pizza category to pressure restaurant margins.

"It's very likely that they're concerned the discounting will continue throughout the year a little more than they had originally expected," analyst Ludington said.

Q1 BEATS

For the first quarter ended March 28, the Louisville, Kentucky-based company reported a net profit of $16.9 million, or 62 cents a share, compared with $17.8 million, or 64 cents, a year ago.

Excluding items, the company earned 54 cents a share, beating analysts' expectations for earnings of 50 cents a share, according to Thomson Reuters I/B/E/S.

Revenue rose 2 percent to $285.8 million, also outpacing Wall Street forecasts for revenue of $279.8 million.

The beat was driven in part by lower commodity costs. Customer traffic also increased but was offset by a lower average ticket price.

Earlier in the day, rival Domino's Pizza (DPZ.N) reported forecast beating results helped by its new pizza recipe debuted in December. [ID:nN04242442]

Shares of Papa John's closed at $28.26 Tuesday on Nasdaq. (Reporting by Abhishek Takle in Bangalore; Editing by Aradhana Aravindan)

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