For the third quarter, net income increased 26% to $11.5 million versus $9.1 million in the same period last year and rose 24% to $0.41 per diluted share from $0.33 per diluted share in the year-earlier period. Revenues for the third quarter were up 23% to $91.6 million compared with $74.3 million in the third quarter last year.
For the first nine months of fiscal 2001, net income rose 17% to $25.5 million from $21.8 million in the year-earlier period, while year-to-date net income per diluted share increased 19% to $0.92 compared with $0.77 last year. At $225.9 million, total revenues for the first nine months of fiscal 2001 were 14% ahead of the $198.6 million reported in the same period last year.
"We are pleased with the healthy growth that Sonic achieved in the third quarter as revenues, same-store sales and profits all exceeded expectations,'' said Clifford Hudson, chairman and chief executive oifficer. "Reflecting a strong rebound from the first half of the year, when drive-in openings and sales were hampered by bad weather, our third quarter results underscore the strength of our brand and our multi-layered growth strategy. From the standpoint of same-store sales, it was in fact the best quarter we have had since the fall of 1999. With the momentum these results provide going into the fourth quarter, and the solid fundamentals they reflect in all aspects of our business, we look forward to a strong finish to our fiscal year this August.''
Hudson noted that strong promotions and new product news, coupled with higher media expenditures, played an important role in driving higher sales in the third quarter. During the quarter, Sonic completed the rollout of a menu redesign that highlights its more distinctive products and makes highly differentiated options, such as its Toaster Sandwiches and Cream Pie Shakes, a permanent part of the company's product mix. ``It's very exciting and gratifying to see the way customers are responding to a menu and promotions that emphasize the flexibility we have to accommodate their desire for new and changing tastes,'' he said. "These initiatives continue to generate increased traffic and higher average checks.''
According to Hudson, Sonic's system-wide same-store sales for the third quarter rose 4.8%, reflecting a significant acceleration from the first half of the year and well ahead of the 2.0% increase reported in the same period last year. For the first nine months of the year, system-wide same-store sales increased 0.7% versus 3.2% last year. System-wide average unit volumes increased 4.8% and 1.1% for the quarter and year-to-date period.
During the third quarter, Sonic opened 46 new drive-ins, including 36 franchised restaurants. So far this year, the company has opened 123 new restaurants versus 112 in the same period last year and remains on track to add a record total of 190 new drive-ins to the chain in fiscal 2001.
Concluding, Hudson added: "Looking ahead to fourth quarter and into fiscal 2002, we believe Sonic remains in a very sound position to deliver industry-leading growth in sales and profits. We expect the fundamental strength of Sonic's business will continue to produce revenue growth of approximately 20% annually, with the next few quarters being ahead of that pace due to the impact of recent drive-in acquisitions. This top-line growth will reflect our ongoing commitment to increased media expenditures, which will exceed $80 million this fiscal year, an emphasis on new product news and promotions, and new strategies to further penetrate underserved day parts, including our expanded breakfast test. We believe these initiatives will continue to drive same-store sales growth in the range of 2% to 4%, which in combination with ongoing new drive-in development and the impact of higher sales volumes through our franchise-focused operations, will mitigate potentially higher restaurant-level costs and fuel ongoing earnings growth in the range of 18% to 20% in the fourth quarter and for fiscal 2002 as well.''