Sonic shares jump to 6-year high

Shares of fast food chain Sonic jump to 6-year high on rise in 2nd-quarter net income

Associated Press

NEW YORK (AP) -- Harsh winter weather didn't keep Sonic down.

The drive-in restaurant chain said late Monday that its net income and a key sales figure rose during its second quarter, despite bad weather.

Investors appreciated the results, sending shares of Sonic Corp. up as high as $23.51 Tuesday, its highest point since December 2007.

New menu items, a fresh advertising campaign and newly-implemented technology helped boost sales, CEO Cliff Hudson said in a call with investors and analysts. The company is in the process of updating its stores with a new ordering system for customers that's increasing the amount of stuff diners buy, Hudson said.

Sonic's strong results come after rival McDonald's Inc. said it is struggling to attract diners as customers seek foods that are fresher or healthier.

Sonic said its net income rose to $4.1 million, or 7 cents per share, in the three months ending Feb. 28, up from $3.6 million, or 6 cents per share in the same quarter a year ago.

Revenue slipped 1.3 percent to $109.7 million from $111.1 million.

Analysts expected earnings of 6 cents per share and revenue of $110.3 million, according to FactSet.

Sales at stores open at least a year rose 1.4 percent. The metric is considered a key indicator of a retailer's financial health. It strips away the impact of recently opened or closed stores. The company expects that number to rise in the "low single digit range" in 2014 from the year before.

In afternoon trading Tuesday, shares of the Oklahoma City-based company rose $2.37, or 11.3 percent, to $23.29.

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