Papa John's Posts Q3 Loss - Update

(RTTNews) - Papa John's International (PZZA) Tuesday posted a loss for the third quarter as revenues slipped 15%. The pizza chain lowered the top-end of its full-year adjusted earnings outlook.

Louisville, Kentucky-based Papa John reported third-quarter loss of $13.0 million or $0.41 per share, compared with a profit of $21.8 million or $0.60 per share last year.

Adjusted earnings for the quarter were $0.20 per share. Analysts polled by Thomson Reuters estimate earnings of $0.22 per share. Analysts' estimates typically exclude special items.

The company's revenues for the quarter slipped 15.7% to $364.0 million from $431.7 million last year. Analysts had a consensus revenue estimate of $393.68 million for the quarter.

Looking forward to the full year 2018, the company now expects adjusted earnings of $1.30 to $1.60 per share, compared with previous outlook of $1.30 to $1.80 per share. Analysts currently estimate earnings of $1.51 per share for 2018.

"The negative publicity surrounding the company's brand that began in July 2018 has continued to impact the North America system-wide sales and the company cannot predict how long and the extent to which negative publicity will continue," the company said in a statement.

Scandals related to founder John Schnatter have weighed heavily on the chain as it has been offering more discounts and ads to turn around business.

Schnatter was pressured to resign as chairman after he used a racial slur during a conference call that was arranged between Papa John's executives and marketing agency. Since then the founder and the board have been fighting.

PZZA closed Tuesday's trading at $53.47, down $1.05 or 1.93%, on the Nasdaq. The stock, however, gained $1.88 or 3.52% in the after-hours trading session.