Jack in the Box Profit Climbs 32% in Quarter

Strong sales of new products, improved operating margins and a lower tax rate helped Jack in the Box Inc. report a 32% jump in fiscal fourth-quarter earnings Wednesday.

The San Diego-based operator and franchiser of about 2,180 Jack in the Box and Qdoba Mexican Grill restaurants reported net income of $21.7 million, or 58 cents a share, for the three months ended Oct. 3, compared with $16.4 million, or 45 cents, for the same period last year.

Excluding the benefit of an extra week, the company posted earnings of 55 cents. Wall Street analysts had forecast earnings of 49 cents, according to Thomson First Call.

Revenue rose 21% to $594 million. The company credited a 4.1% rise in sales at Jack in the Box restaurants open at least a year to new menu items, including natural cut fries, sourdough melt sandwiches and chocolate malted crunch shakes.

In fiscal 2004, the company’s profit rose 6.7% to $78.5 million, or $2.12 a share, from $73.6 million, or $1.99, in 2003. Excluding charges, the company earned $82.7 million, or $2.24 a share, in 2004. Revenue rose 12% to $2.3 billion from $2.06 billion, while sales at Jack in the Box outlets open at least a year increased 4.6%, contrasted with a 1.7% decrease in 2003.

The company also reiterated its earnings forecast of 69 cents a share during the first quarter of 2005 and $2.43 a share for the year.

“We found [the forecast] a bit disappointing given the higher base of earnings they were coming off going into 2005,” wrote Mark Kalinowski, an analyst with Citigroup Smith Barney, in a research note Wednesday.

Jack in the Box also announced the retirement of John F. Hoffner as chief financial officer and executive vice president; he will stay on as an advisor through next year. Jerry P. Rebel, current vice president and controller, will assume the role of senior vice president and chief financial officer at the start of the company’s second quarter on Jan. 24.

Hoping to reduce training costs by boosting employee retention, the company said it had also begun offering healthcare coverage to restaurant crew members at company-owned outlets.

Jack in the Box shares rose 91 cents to $34.91 on the New York Stock Exchange.