Papa John’s International, Inc. (Nasdaq:PZZA) yesterday announced 0.5% domestic systemwide comparable sales growth for the four weeks ended August 26, 2001, composed of a 1.5% increase at franchised restaurants and a 2.3% decrease at company-owned restaurants. Total systemwide international sales increased 23% for the four-week period, on a constant U.S. dollar basis, over the comparable period last year.
In July, the company announced that it expected its earnings per share to be at or near the lower end of its previously forecasted ranges of $0.42 to $0.49 for Q3 and $0.51 to $0.58 for Q4, due to higher cheese and utility costs and a very competitive marketing and promotional environment during the second half of 2001. Today the company announced that, principally due to better than expected sales at its franchised restaurants and continued effective cost control measures at the company, it expects 3Q EPS to be in the middle to upper middle of the range. The company did not change its EPS outlook for the fourth quarter.
The company also announced the following changes to its management team:
International Division. Bill Van Epps is joining Papa John’s to lead its International Division. Van Epps, who will join Papa John’s as Managing Director, International Division and report to Chief Development Officer Chuck Schnatter, will be responsible for overseeing all international franchising, development and operations for the company. Bob Thiess, Papa John’s Vice President, International since 1997, will report to Van Epps.
Van Epps has more than 30 years of foodservice experience, including 17 years in the international arena. Since August 1999, Van Epps has served as President of the International Division of Yorkshire Global Restaurants, responsible for all aspects of Yorkshire’s international business, which includes more than 225 franchised A&W and Long John Silver’s restaurants in 15 countries.
From 1993 to 1999, Van Epps served in several positions with AFC Enterprises, including President of its International Division. Under Van Epps’ leadership, international operations at AFC’s four brands – Churchs, Popeye’s, Cinnabon and Seattle Coffee Co. – tripled from 190 to more than 600 restaurants.
Van Epps was also formerly with Pepsico International, from 1974 to 1981, leading the expansion of Pizza Hut into Hong Kong, Thailand and Singapore, while also overseeing the operation of 150 company-owned and franchised Pizza Hut restaurants in Australia, New Zealand and Japan.
“We’re excited to have Bill Van Epps join our team to head up our International Division,” said John Schnatter, Papa John’s Founder and Chief Executive Officer. “He is a talented restaurant operator with a tremendous amount of experience developing U.S. based brands throughout the world.”
Marketing. Syl Sosnowski, Vice President of Marketing, is leaving the company to pursue other career opportunities. The company is actively seeking candidates to replace Sosnowski. Until such time as a new Vice President of Marketing is hired, company Founder and Chief Executive Officer John Schnatter will oversee marketing with assistance from Mary Ann Palmer, Papa John’s Chief Resource Officer.
“We appreciate Syl’s six years of service to the company and wish him the best,” said Schnatter.
The company has recently added two Senior Directors to bolster its marketing staff. Cathy Hull joins Papa John’s as Senior Director of Marketing Analysis and Strategic Planning after 18 years with Kraft Foods, where she was most recently focused on business development and local marketing initiatives. Chris Jacobsen joins Papa John’s as Senior Director of Marketing and Internal Communications after 11 years in marketing and communications at Waffle House.
At September 16, 2001, there were 2,697 Papa John’s restaurants (631 company-owned and 2,066 franchised) operating in 47 states and ten international markets. Papa John’s also owns or franchises 194 Perfect Pizza restaurants (3 company-owned and 191 franchised) in the United Kingdom. For more information about the company, visit Papa John’s at http://www.papajohns.com.
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect management’s expectations based upon currently available information and data; however, actual results are subject to future events and uncertainties, which could cause actual results to materially differ from those projected in these statements. Factors that can cause actual results to materially differ include: increased advertising, promotions and discounting by competitors which may adversely affect sales; the ability of the company and its franchisees to open new restaurants and operate new and existing restaurants profitably; increases in food, labor, utilities, employee benefits and similar costs; economic and political conditions in the countries in which the company or its franchisees operate; new product and concept developments by food industry competitors; and the uncertainties associated with litigation. Further information regarding factors that could affect the company’s financial and other results is included in the company’s Forms 10Q and 10K, filed with the Securities and Exchange Commission.