Triarc Companies Inc., the parent company of Arby’s Restaurant Group Inc., which is the franchisor of the Arby’s restaurant system, announced today the results of operations for its fiscal second quarter and six months ended June 29, 2008.

Highlights for the 2008 Second Quarter include:

• Sales increased 4.6 percent to $291.3 million for Company-owned restaurants;

• Same-store sales decreased 3.3 percent system wide;

• Franchise revenues increased 1.4 percent to $21.7 million;

• Adjusted consolidated EBITDA* of $25.9 million increased 1.2 percent from $25.6 million in the second quarter of 2007; and

• Net loss of $6.9 million, including pre-tax investment loss of $9.2 million, due primarily to a decline in value of equity investments, as compared to net loss of $28.0 million for the second quarter of 2007.

Highlights for the first Six Months of 2008 include:

• Sales increased 5.1 percent to $572.9 million for Company-owned restaurants;

• Same-store sales decreased 1.8 percent system wide;

• Franchise revenues increased 4.4 percent to $42.9 million;

• Adjusted consolidated EBITDA* of $50.9 million increased 7.2 percent from $47.5 million in the 2007 six-month period; and

• Net loss of $74.4 million, including investment loss of $75.1 million, due primarily to the loss on Deerfield Capital Corp. (“DFR”) common stock distributed to Triarc stockholders on April 4, 2008, as compared to net loss of $20.9 million for the first six months of 2007.

* Adjusted consolidated EBITDA excludes 2007 amounts related to the asset management business which was sold on December 21, 2007, and corporate restructuring charges for 2007 and 2008. A reconciliation of Non-GAAP measurements to GAAP results is included below.

Commenting on 2008 second quarter results, Roland Smith, CEO of Triarc, says, “The Arby’s brand stands for high quality products, which has resulted in higher check average relative to our competitors. During the second quarter, we did not waiver from this long-established ‘cut above’ brand positioning and results were negatively impacted by the effect of aggressive competitor discounting. Looking ahead, we believe continued competitor discounting at the current level is unsustainable given rising commodity costs and increasing profitability pressure on operators–we are already seeing reports of competitors re-evaluating the prices of their value menus. Our plan in the near-term is to be opportunistic by offering more value-oriented products supported by national advertising. Longer-term, we believe Arby’s will remain well positioned to deliver superior results due to our unique brand attributes, loyal customers, supportive franchisee base and strong operations-centric business model.”

Commenting on the pending merger with Wendy’s, Smith added: “The combination of Wendy’s and Arby’s continues to represent a major strategic opportunity to create significant long-term value for the shareholders of both Triarc and Wendy’s. We are focused on developing a comprehensive integration plan and organizational structure that supports enhanced operating performance at both brands. As I prepare to assume my chief executive responsibilities at Wendy’s post-merger, I am especially excited about the recent appointments of David Karam, a long-time Wendy’s franchisee, to president of Wendy’s, Steve Farrar, Wendy’s current chief of North American operations, to chief operating officer and Ken Calwell, formerly with Domino’s Pizza, who will re-join Wendy’s as chief marketing officer, all of which are effective upon the closing of the merger. The addition of these high-caliber and well-respected restaurant executives to key leadership roles at Wendy’s marks an important first step toward improving Wendy’s performance and achieving our growth objectives. We remain on track to close the merger in the second half of 2008 and look forward to sharing more details on the integration process at that time.”

Second Quarter 2008 Results

Consolidated revenues were $313.0 million in the second quarter of 2008 as compared to $300.0 million for the second quarter of 2007, excluding $16.8 million in asset management and related fees. Due to the sale of Triarc’s asset management business in December 2007, there was no comparable amount in the current quarter.

Sales for the second quarter of 2008 increased 4.6 percent to $291.3 million from $278.6 million in the second quarter of 2007, primarily due to the 88 net Company-owned restaurants added since July 1, 2007, including 49 net restaurants acquired from franchisees, offset by a 3.7 percent decrease in same-store sales at Company-owned restaurants during the quarter.

Franchise revenues for the second quarter of 2008 increased 1.4 percent to $21.7 million from $21.4 million for the second quarter of 2007. Excluding $0.6 million of rental income from properties leased to franchisees that is included in franchise revenues for the three months ended June 29, 2008 and not included in 2007, franchise revenues decreased $0.3 million primarily due to a 3.0 percent decrease in same-store sales at franchised restaurants during the current quarter.

Same-store sales at Company-owned restaurants and franchised restaurants decreased compared to the year-ago quarter primarily due to a decline in customer traffic related to aggressive price discounting by competitors during the 2008 second quarter in the continuing soft economy.

Gross margin (difference between sales and cost of sales divided by sales) decreased to 24.3 percent in the second quarter of 2008 from 26.5 percent of sales in the second quarter of 2007. The gross margin decreased primarily due to higher labor costs driven by federal and state minimum wage increases, increased utility costs as a result of higher energy costs, as well as the de-leveraging effect of the same-store sales decreases on other operating costs. Food costs, as a percentage of sales, were slightly favorable in the second quarter compared to a year ago due to product and packaging cost savings, mix shifts, as well as due to the effect of price increases taken since July 2007.

Advertising increased to 8.4 percent of sales in the second quarter of 2008, from 7.4 percent of sales in the second quarter of 2007, primarily due to a quarterly timing shift of media spending. We expect advertising costs as a percentage of sales on a full year basis in 2008 to remain relatively flat to 2007, which was 7.1 percent.
General and administrative expenses decreased 24.8 percent to $42.1 million in the second quarter of 2008, from $56.0 million in the second quarter of 2007, primarily due to the elimination of $7.1 million of expenses related to the former asset management business, as well as $7.1 million of savings related to the consolidation of the corporate headquarters from New York to Atlanta.

General and administrative expenses in the second quarter of 2008 included expenses of $1.6 million related to prior year franchise tax assessments and $3.0 million of merger advisory and public company services under a service agreement with Trian Fund Management, L.P. which expires in June 2009. General and administrative expenses are expected to be lower during the remainder of 2008 as compared to the same period in 2007 as a result of the completion of the corporate restructuring and the sale of the asset management business.

Depreciation and amortization decreased $0.7 million reflecting $2.5 million of expenses incurred in the second quarter of 2007 related to the former asset management business, partially offset by increases in depreciation and amortization for new restaurants opened since July 1, 2007. Depreciation and amortization in the second quarter of 2008 included $1.3 million of non-cash impairment charges related to 10 underperforming units compared to $0.6 million of such charges in the second quarter of 2007.

Adjusted consolidated EBITDA of $25.9 million in the second quarter of 2008 increased 1.2 percent as compared to adjusted consolidated EBITDA of $25.6 million in the second quarter of 2007 (see reconciliation of non-GAAP measurements to GAAP results below).

Investment loss was $9.2 million in the second quarter of 2008 compared to investment income of $17.6 million in the second quarter of 2007. The 2008 non-restaurant related investment loss was primarily due to realized and unrealized losses on securities in the investment portfolio, while investment income from the second quarter of 2007 primarily related to deferred compensation trusts which existed prior to the corporate restructuring.

The effective tax rate benefit for the second quarter of 2008 was 50 percent, compared to 57 percent in the second quarter of 2007. The difference between the 35 percent statutory rate and the effective tax rate in 2008 is principally the result of non-deductible compensation and other expenses, and state income taxes, net of federal income tax benefit.

Net loss was $6.9 million in the second quarter of 2008 compared to a net loss of $28.0 million in the second quarter of 2007. Diluted loss per share was $0.07 for both Class A and Class B common stock, Series 1, in the second quarter of 2008 compared to diluted loss per share of $0.30 for Class A and Class B common stock, Series 1, in the second quarter of 2007.

Strategic Update

Arby’s long-established marketing strategy has been to provide premium quality, hand-carved sandwiches with fresh ingredients as the foundation for its brand positioning of “Something Different, Something Better.” This unique selling proposition has enabled Arby’s to enjoy a high average check and operating margins that we believe are among the best in the quick service restaurant industry. Over the long-term, this core strategy has proven quite successful in producing superior operating results and return on invested capital.

Current economic conditions have strained the U.S. consumer, and our competitors have responded with aggressive value offerings. As a result, Arby’s customer traffic is down which, in turn, has reduced operating margins as a result of the de-leveraging effect of same-store sales decreases. In addition, like all restaurant companies, Arby’s is facing significant increases in commodity and labor costs from federal and state minimum wage legislation.

Arby’s plan for addressing this challenging environment is a two-tiered marketing and pricing initiative. First, Arby’s will continue to execute its premium quality and pricing strategy to preserve both brand image and profitability. Second, Arby’s will address affordability with today’s price-conscious consumer through a series of tactical value-oriented product offerings supported by national advertising as a supplement to the core menu. The objective of this two-tiered approach is to improve short-term sales and increase the number of customer visits while allowing Arby’s to continue to deliver its historically high levels of restaurant profitability over the long-term.

While weak economic conditions may continue to impact our business near-term, significant progress continues on other long-term growth strategies. Enhancements to the breakfast menu continue as well as expansion of the number of Arby’s restaurants participating in the fast-growing day part. Market testing has begun on a business catering program that leverages the quality of core menu items with the convenience of office delivery. These key initiatives, in addition to ongoing menu re-engineering and innovation programs, are designed to position Arby’s for future profitable growth as the second largest sandwich chain in the quick-service industry.

Growth in the number of Arby’s restaurants continues with approximately 40 new Company-owned and approximately 90 new franchisee units expected to open during 2008. In addition, Arby’s announced today that it has signed a development agreement with a new franchisee to open 41 Arby’s restaurants in the New York metropolitan market.

Merger Agreement with Wendy’s

On April 23, 2008, Triarc entered into a definitive merger agreement with Wendy’s International Inc. for an all stock transaction in which Wendy’s shareholders will receive 4.25 shares of Triarc’s Class A common stock for each share of Wendy’s common stock they own. Under the agreement, Triarc stockholders will also be asked to approve, among other proposals, the issuance of Class A common stock to Wendy’s shareholders and the conversion of each share of Triarc Class B common stock, Series 1, into one share of Triarc Class A common stock, resulting in a post-merger company with a single class of common stock.

The transaction is subject to customary closing conditions and the approval of both Triarc stockholders and Wendy’s shareholders. There can be no assurance that the necessary approvals will be obtained, that the merger will be consummated, or that the anticipated benefits and synergies will be realized. The transaction is expected to close during the second half of 2008.

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