Applebee's Sales Continue to Slip as IHOP's Grow
Domestic same-store sales decreased 0.5 percent at Applebee's and increased 3.9 percent at IHOP during the first quarter, as IHOP achieved its fourth consecutive quarter of positive same-restaurant sales, according to parent company DineEquity. DineEquity announced finanical results for the first quarter of 2014 this week.
The first quarter's 0.5 percent sales decrease follows a 0.7 percent sales decrease in the fourth quarter of 2013, compared to the year-ago same quarter, and a sales slide of 0.4 percent in the third quarter of 2013. In all, Applebee's domestic system-wide same-store sales fell 0.3 percent in fiscal 2013.
"At Applebee's, we are conducting a comprehensive assessment of the brand, with the goal of achieving consistent and positive same-restaurant sales and traffic," says Julia A. Stewart, chairman and CEO of DineEquity, Inc. "We have the foundation to build momentum at both brands and maintain our commitment to create additional value for our shareholders."
Despite the decrease in Applebee's sales, DineEquity achieved a higher first-quarter revenue this year compared to 2013, fueled by IHOP's growth. First quarter franchise and restaurant revenue in 2014 hit $131.8 million, an increase of $3.47 million compared to the same quarter last year.
Stewart contributed IHOP's growth to positive enhancements made at the brand. "IHOP's same-restaurant sales were positive for the fourth consecutive quarter and overwhelmingly outperformed its category, reflecting our focus on menu enhancements, innovative advertising, and higher operating standards," she says.
"DineEquity started 2014 with a strong first quarter, building on our accomplishments from the prior year," she adds. "We continue to execute on our strategy and generate strong free cash flow."