Wendy's Profit Falls on Revamp Expenses

Wendy's International said its net income fell, but earnings before restructuring and other expenses rose 55 percent due to a menu price increase and cost controls.

The restaurant company's shares dropped 3 cents at $34 in after-hours trading, having closed up 78 cents at $34.03 during regular market trade on the New York Stock Exchange.

The world's third-largest hamburger chain also said full-year earnings would be near the high end of its targeted range.

Third-quarter earnings from continuing operations rose to $38.6 million, or 44 cents per share, from $24.9 million, or 21 cents per share, a year ago. But those results exclude costs for restructuring and an ongoing review of strategic alternatives by the hamburger chain's board of directors.

Including those charges, net income fell to $29.9 million, or 34 cents per share, from $69.2 million, or 58 cents per share, a year ago, when Wendy's still owned the Tim Hortons and Baja Fresh chains.

In a statement, Wendy's said it expects to report full-year earnings near the high end of a $1.09 per share to $1.23 per share range it forecast earlier this year.

Wall Street analysts, on average, had been expecting earnings of $1.12 cents per share, according to Reuters Estimates.

For the third quarter, Wendy's total revenue rose 0.2 percent to $631.1 million. Analysts had been expecting revenue of $629.4 million, according to Reuters Estimates.

As previously announced, sales at restaurants open at least 15 months rose 0.2 percent at U.S. company-owned restaurants and climbed 1.3 percent at U.S. franchised restaurants during the quarter.