Jack in the Box, Inc., operator and franchisor of Jack in the Box restaurants, today announced that net earnings in the first quarter ended January 20 increased 4.3 percent to $26.7 million, or 67 cents per share, compared with $25.6 million, or 65 cents per share, in the first quarter a year ago. Results include adjustments for the adoption of SAB 101 in the fourth quarter of fiscal 2001, which added four cents per share to first quarter net earnings in both years. On a full-year basis, SAB 101 adjustments are expected to have an immaterial impact on operating results.

Robert J. Nugent, chairman and CEO of the quick-serve restaurant chain, said, “Our profit improvement versus forecast was the result of a renewed focus on all aspects of our business. It includes an improvement in restaurant operating margin versus forecast; a reduction in this year’s estimated tax rate to 36.5 percent from 37.9 percent in last year’s first quarter; and leverage of our SG&A expenses to 11.1 percent of revenues versus 11.2 percent in the first quarter of 2001, despite softer than anticipated sales.”

Company restaurant sales reached $552.5 million, a 9.1 percent increase over the first quarter of fiscal 2001. Total revenues grew 9.4 percent to $594.2 million.

Same-store sales at company restaurants grew 0.7 percent on top of a 4.3 percent increase last year, and were slightly higher than forecast, marking the company’s 28th consecutive quarter of same-store sales improvement. Same-store sales in the January fiscal period increased 1.2 percent on top of a 5 percent increase in 2001.

“We remain committed to increasing shareholder value through building our brand and strengthening the quality of our operations,” said Nugent. “Our recently announced Profit Improvement Program is supporting that goal by helping us identify both short- and long-term ways to run our business more effectively.

“Additionally, we are continuing our efforts to selectively increase the use of franchising in our business model as we grow, with three franchise conversions in the first quarter of this year compared with one last year.”

During the quarter, the company launched several promotions, including the $1.99 Ultimate Cheeseburger, the Free Holiday Ball with a Sourdough Jack Combo, Free Jumbo Sizing with the purchase of a Bacon Ultimate Cheeseburger, and the holiday-oriented Egg Nog Shake.

In addition, the company introduced a new, 99-cent product to its Value Menu, The Big Cheeseburger, and in Texas, the Big Texas Cheeseburger.

Jack in the Box opened 35 new company restaurants during the quarter, five more than forecast, for a total of 1,462 units, an increase of 8.6 percent compared with the first quarter last year. Franchised restaurants at quarter end totaled 335, for a systemwide total of 1,797 Jack in the Box restaurants, compared with 1,666 total units last year.

The company currently estimates that its second-quarter earnings per share will be 44 cents compared with 42 cents in the second quarter last year, as adjusted for SAB 101. Guidance for fiscal 2002 earnings per share has been increased to $2.24 from $2.18, primarily due to the reduction in this year’s effective tax rate.