Friday, April 16, 2010

KK poised for a profit

After weathering first the Atkins Diet Craze and then a vast economic recession, Winston-Salem-based Krispy Kreme is on the brink of a profit, according to its chairman.

The company just barely missed posting its first profitable year since 2004 despite having a fourth-quarter profit of $520,000, says MCT.

Jim Morgan, the company's chairman, president and chief executive, cautioned at the 2008 shareholders meeting that there likely will be some "unevenness" in quarterly performance for up to two years.

''During fiscal 2010, we made substantial progress in building a stronger foundation for our company and improving our business model," Morgan said in a statement. "We generated positive company same-store sales in all four quarters despite the difficult economy, while also delivering substantially higher operating income."

He said that the company expects to show a profit in fiscal 2011.

''We are working vigorously to continue implementation of our strategic plans and, in doing so, we believe we are setting the stage for additional and more robust growth in revenues and earnings in fiscal 2012 and beyond," Morgan said.

The company reported Thursday that its loss for fiscal 2010, which ended Jan. 31, was $157,000, compared with a loss of about $4 million in fiscal 2009. ...

Krispy's share price slipped 8 cents to close at $4.96 yesterday -- 19 cents below its 52-week high of $5.15 set on Tuesday. Because of the company's financial difficulties in recent years, coverage of its stock has been dropped by most analysts.

"KK" plans to add seven to 10 company stores, along with 35 to 45 domestic and international franchise shops.

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