IHOP Corp. executives reported an 11.2% drop in third-quarter net
income Tuesday and said its financial performance in the fourth
quarter is expected to be below previous expectations.
Officials at the Glendale-based pancake chain cited the continued
effect of company-store openings; related timing of sales of
franchises; recent weakness in company-store sales growth; and
continued uncertainty with regard to the consumer-spending
"While we remain on track to add 80 to 90 IHOP-developed stores to
the IHOP system this year, the timing of franchising those new
restaurants has lagged -- particularly in new markets where we do not
always have the benefit of an existing franchisee base to build
upon," IHOP CEO Julia A. Stewart released in a statement. "We have
made decisions to open restaurants as company-operated in these
locations rather than rely on new or inexperienced franchisees to
best establish IHOP as a viable competitor in these markets."