During its second quarter, which ended Feb. 28, the Sonic posted a year-over-year same-store sales increase of 5.5%. Executives say the company is on track to record a 3% to 5% jump for the entire year. In core markets comps were up 6.1%, while developing areas rose 2.9%.
Net income also increased during the quarter, by 14% to $12.9 million, despite a 10% year-on-year rise in the price of beef. Like other retailers, the firm is also battling higher development and construction costs, says Scott McLain, president of Sonic Industries, the division which the drive-thru-chain's franchise operations.
New products like gingerbread-blast shakes and mushroom-Swiss hamburgers have lifted sales, executives say. The installation of self-service debit- and credit-card payment stalls at at 60% of its drive-ins has also helped increase average ticket sales. The remainder of its units should have those payment terminals installed by the end of the year. This year the company is also increasing its marketing funds from $125 million to $145 million.
During the third quarter, executives anticipate that they will acquire 15 franchised drive-ins and open 45 to 50 new locations, 35 to 40 operated by franchisees. Sonic continues to grow East, from its core Midwest and Southern stores and opened its first Pennsylvania location during the last quarter.
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