By Dhanya Skariachan
July 31 - Restaurant chain operator DineEquity Inc
reported a better-than-expected quarterly profit on Tuesday,
helped by lower costs and strength in its Applebee's business.
Shares of DineEquity, which also owns the IHOP restaurant
chain, rose 7.6 percent to $49.68 in morning trading on the new
York Stock Exchange.
The results were a bright spot in a restaurant industry that
has seen some disappointing numbers in recent weeks, including
earnings from McDonald's Corp and Chipotle Mexican Grill
Inc and sales at Olive Garden owner Darden Restaurants
Lackluster job growth and weak consumer confidence make some
diners reluctant to spend money on meals away from home.
DineEquity said it plans to cut costs further by eliminating
100 jobs. The action is expected to generate $10 million to $12
million in savings on an annual basis, it said.
The company also said Jean Birch, president of its IHOP
business, will leave the company effective Aug. 27. DineEquity
Chief Executive Julia Stewart will assume day-to-day leadership
of the brand until a successor is found, the company said.
Systemwide sales at established U.S. restaurants were up 0.7
percent at Applebee's and down 1.4 percent at IHOP in the second
Overall revenue fell 14.5 percent to $229.4 million.
Net income was $15.9 million, or 88 cents a share, compared
with a net loss of $284,000, or 2 cents a share, a year earlier.
Excluding items, the company earned $1.06 a share, beating
analysts' average estimate of $1.01, according to Thomson