DineEquity CEO to resign as restaurant firm’s earnings decline
DineEquity Inc. said Friday that Julia Stewart plans to resign as chairman and chief executive of the Glendale-based parent of the Applebee’s and IHOP restaurant chains, effective March 1.
The company gave no reason for Stewart’s departure, but it comes as DineEquity reported declines in preliminary fourth-quarter and full-year earnings.
DineEquity’s stock tumbled in response, losing $6.41 a share, or nearly 10%, to close at $60.14. The stock has plunged 30% in the last two months.
The company said one of its directors, Richard Dahl, would be interim chairman and chief executive while DineEquity’s board searches for Stewart’s replacement. DineEquity operates and franchises 3,700 restaurants in 18 countries.
Stewart previously headed IHOP, originally the International House of Pancakes. She merged that company with Applebee’s, which she had earlier served as president, in 2007 to create DineEquity.
“I am confident in the strong roadmap that has been set forth and will continue to cheer for the company’s success,” Stewart said in a statement.
But both chains are struggling in the U.S. market. IHOP’s domestic comparable sales in the fourth quarter – that is, restaurants open at least a year – fell 2.1% from a year earlier, DineEquity said. Applebee’s domestic comparable sales fell 7.2% in the quarter.
“I will be working very closely with the Applebee’s franchisees to improve performance,” Dahl said in a statement.
Also in the fourth quarter, DineEquity said preliminary results showed profit fell to $21.1 million, or $1.18 a share, from $25 million, or $1.35 a share, a year earlier.
DineEquity said it would report its definitive fourth-quarter and full-year results March 1.
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UPDATES:
1:35 p.m.: This article was updated with DineEquity’s closing price.
This article was originally published at 11:40 a.m.
