UPDATE 1-Papa John's third-quarter earnings drop 63 pct

(Adds revenue, same-store sales, raises outlook)

LOS ANGELES, Nov 6 (Reuters) - Papa John's International Inc PZZA.O on Tuesday reported a 63 percent drop in quarterly net earnings as higher labor and cheese costs offset increased sales at its pizza delivery restaurants.

Net income was $4.8 million, or 16 cents per share, compared with $13.1 million, or 40 cents per share, a year ago.

Excluding the results of the company’s franchisee-owned cheese purchasing entity, known as BIBP, Papa John’s earned 39 cents a share, up from 31 cents a share last year.

Results for the quarter included a benefit of 8 cents a share from the finalization of certain tax issues.

Revenue rose 9.6 percent to $262.8 million. Analysts were expecting revenue of $258.1 million, according to Reuters Estimates.

Same-store sales, a key retail measure that tracks sales at stores open at least a year, rose 4.3 percent during the quarter. In the United States, however, same-store sales were up just 0.2 percent.

At domestic company-owned restaurants, operating income fell 38 percent to $3.5 million due to minimum wage increases, higher commodity costs, and increased marketing spending.

Papa John’s boosted its full-year earnings forecast to $1.64 to $1.68 per share, excluding BIBP. Analysts were expecting earnings of $1.58 per share, according to Reuters Estimates.

Papa John’s owns or franchises more than 3,000 restaurants in the United States and 27 other countries.

(Reporting by Nichola Groom, editing by Leslie Gevirtz)

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