Jack In The Box Inc. (JACK, Financial) filed Quarterly Report for the period ended 2010-07-04.
Jack In The Box Inc. has a market cap of $1.14 billion; its shares were traded at around $20.65 with a P/E ratio of 10.2 and P/S ratio of 0.5. Jack In The Box Inc. had an annual average earning growth of 9% over the past 10 years. GuruFocus rated Jack In The Box Inc. the business predictability rank of 2.5-star.JACK is in the portfolios of John Buckingham of Al Frank Asset Management, Inc., Kenneth Fisher of Fisher Asset Management, LLC, Pioneer Investments, Stanley Druckenmiller of Duquesne Capital Management, LLC, Robert Olstein of Olstein Financial Alert Fund, Steven Cohen of SAC Capital Advisors, HOTCHKIS & WILEY of HOTCHKIS & WILEY Capital Management LLC, Bruce Kovner of Caxton Associates.
Food and packaging costs were 31.8% of restaurant sales in the quarter versus 31.4% last year and 31.7% year-to-date compared with 32.7% a year ago. Commodity costs increased approximately 2.0% in the quarter, principally related to beef and pork, and decreased approximately 3.0% year-to-date due primarily to declines in beef, shortening, poultry and cheese. In both periods, our margin improvement initiatives and modest selling price increases more than offset the impact of unfavorable product mix and promotions.
Payroll and employee benefit costs were 30.4% of restaurant sales in the quarter and year-to-date, compared to 28.9% and 29.8%, respectively, in 2009, reflecting the impact of same-store sales deleverage and an increase in our workers compensation costs, which more than offset the benefits derived from our labor productivity initiatives. Workers compensation costs have increased as the cost per claim is trending higher even though the number of claims is lower.
Occupancy and other costs were 23.5% of restaurant sales in the quarter and 23.4% year-to-date compared with 21.3% in both periods a year ago. The higher percentages in 2010 primarily relate to sales deleverage and higher depreciation from the ongoing re-image program at Jack in the Box, which were partially offset by lower utilities expense and restaurant managed costs.
Distribution costs of sales increased $22.2 million and $60.9 million, respectively, from last year primarily reflecting an increase in the related sales. As a percentage of distribution sales, these costs increased to 100.7% in the quarter and 100.5% year-to-date compared with 99.9% and 99.4%, respectively, a year ago due primarily to deleverage from lower PSA sales at Jack in the Box franchised restaurants.
Franchised restaurant costs, principally rents and depreciation on properties leased to Jack in the Box franchisees, increased $4.8 million in the quarter and $17.7 million year-to-date from a year ago, due primarily to an increase in the number of franchised restaurants that sublease property from us as a result of our refranchising activities. Franchised restaurant costs increased to 44.8% of the related revenues in the quarter and 45.3% year-to-date, from 41.6% and 40.5%, respectively, a year ago due primarily to revenue deleverage from lower sales at franchised restaurants against fixed rental costs.
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Jack In The Box Inc. has a market cap of $1.14 billion; its shares were traded at around $20.65 with a P/E ratio of 10.2 and P/S ratio of 0.5. Jack In The Box Inc. had an annual average earning growth of 9% over the past 10 years. GuruFocus rated Jack In The Box Inc. the business predictability rank of 2.5-star.JACK is in the portfolios of John Buckingham of Al Frank Asset Management, Inc., Kenneth Fisher of Fisher Asset Management, LLC, Pioneer Investments, Stanley Druckenmiller of Duquesne Capital Management, LLC, Robert Olstein of Olstein Financial Alert Fund, Steven Cohen of SAC Capital Advisors, HOTCHKIS & WILEY of HOTCHKIS & WILEY Capital Management LLC, Bruce Kovner of Caxton Associates.
Highlight of Business Operations:
As we execute our refranchising strategy, which includes the sale of restaurants to franchisees, we expect the number of company-operated restaurants and the related sales to continually decrease while revenues from franchised restaurants increase. Company-operated restaurant sales decreased $81.4 million, or 17.8%, in the quarter and $278.0 million, or 17.9%, year-to-date. These decreases are due to a decrease in the number of Jack in the Box company-operated restaurants and declines in same-store sales at Jack in the Box restaurants, partially offset by an increase in the number of Qdoba company-operated restaurants. Same-store sales at Jack in the Box company-operated restaurants decreased 9.4% in the quarter and 9.9% year-to-date compared with a year ago.Food and packaging costs were 31.8% of restaurant sales in the quarter versus 31.4% last year and 31.7% year-to-date compared with 32.7% a year ago. Commodity costs increased approximately 2.0% in the quarter, principally related to beef and pork, and decreased approximately 3.0% year-to-date due primarily to declines in beef, shortening, poultry and cheese. In both periods, our margin improvement initiatives and modest selling price increases more than offset the impact of unfavorable product mix and promotions.
Payroll and employee benefit costs were 30.4% of restaurant sales in the quarter and year-to-date, compared to 28.9% and 29.8%, respectively, in 2009, reflecting the impact of same-store sales deleverage and an increase in our workers compensation costs, which more than offset the benefits derived from our labor productivity initiatives. Workers compensation costs have increased as the cost per claim is trending higher even though the number of claims is lower.
Occupancy and other costs were 23.5% of restaurant sales in the quarter and 23.4% year-to-date compared with 21.3% in both periods a year ago. The higher percentages in 2010 primarily relate to sales deleverage and higher depreciation from the ongoing re-image program at Jack in the Box, which were partially offset by lower utilities expense and restaurant managed costs.
Distribution costs of sales increased $22.2 million and $60.9 million, respectively, from last year primarily reflecting an increase in the related sales. As a percentage of distribution sales, these costs increased to 100.7% in the quarter and 100.5% year-to-date compared with 99.9% and 99.4%, respectively, a year ago due primarily to deleverage from lower PSA sales at Jack in the Box franchised restaurants.
Franchised restaurant costs, principally rents and depreciation on properties leased to Jack in the Box franchisees, increased $4.8 million in the quarter and $17.7 million year-to-date from a year ago, due primarily to an increase in the number of franchised restaurants that sublease property from us as a result of our refranchising activities. Franchised restaurant costs increased to 44.8% of the related revenues in the quarter and 45.3% year-to-date, from 41.6% and 40.5%, respectively, a year ago due primarily to revenue deleverage from lower sales at franchised restaurants against fixed rental costs.
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