UPDATE 1-Krispy Kreme posts surprise Q4 profit before charges
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April 17 (Reuters) - Krispy Kreme Doughnuts Inc KKD.N posted a surprise fourth-quarter profit before charges after the doughnut-shop chain closed stores and rejigged its management in a bid to turn around it business after a string of quarterly losses.
The retailer, which has lost more than two-thirds of its market value over the past year, said it fixed all material weaknesses in its internal control over financial reporting identified as of Jan. 28, 2007.
The company, once a Wall Street favorite, said its net loss widened to $31.8 million, or 50 cents a share, in the fourth quarter ended on Feb. 3 from $24.4 million, or 39 cents a share, a year earlier.
The latest fourth-quarter results include impairment charges and lease termination costs of about 43 cents a share and a charge of $3 million related to payments on behalf of a franchisee.
Excluding charges, the company posted a profit of 3 cents a share, while two analysts on average were expecting a loss of 1 cent a share, according to Reuters Estimates.
Revenue at the company, based in Winston-Salem, North Carolina, fell 1 percent to $110.9 million. Analysts expected total revenue of $105.6 million.
Systemwide sales, which includes sales by both company and franchise stores, rose more than 2 percent, helped by its international franchisees.
Krispy Kreme went public in 2001 with a successful offering, but in recent years struggled with restatements, investigations into its past accounting and a decline in doughnut sales that sent some of its franchisees into bankruptcy. Continua...