Papa John's Reports First Quarter Earnings

Business Wire,  May 6, 2008  

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Share Repurchase Activity

The company's board of directors has authorized the repurchase of $50.0 million of common stock during 2008. The company repurchased approximately 104,000 shares of its common stock at an average price of $21.74 per share, or a total of $2.3 million, during the first quarter of 2008. Subsequent to quarter-end, through April 30, 2008, the company repurchased an additional $6.0 million of common stock (234,000 shares at an average price of $25.65 per share).

At April 30, 2008, $41.7 million remains available for repurchase under the repurchase authorization. The company executed a trading plan under SEC Rule 10b5-1 in March to facilitate the completion of the remaining share repurchase authorization through year-end. A total of 24,000 shares of common stock were issued upon the exercise of stock options for the first quarter ended March 30, 2008.

There were 28.9 million diluted weighted average shares outstanding for the first quarter of 2008, as compared to 30.6 million for the same period in 2007, a 5.6% decrease. Approximately 28.7 million actual shares of the company's common stock were outstanding as of March 30, 2008.

The company's share repurchase activity increased earnings per diluted share, excluding the impact of the consolidation of BIBP, by $0.01 for the first quarter of 2008.

2008 Earnings Guidance Reaffirmed

The company reaffirms its previously announced 2008 earnings per diluted share guidance in the range of $1.68 to $1.76 for the year. The projected earnings guidance excludes any impact from the consolidation of the results of BIBP. We also reiterate our expectations for net worldwide unit growth of 160 to 190 units and for domestic system-wide sales to increase in the range of 1.25% to 2.75%. Our reaffirmation of the guidance reflects our expectations of continued commodity price pressures, most notably cheese and wheat, as well as increased fuel costs.

Non-GAAP Measures

The financial information we present in this press release excluding the impact of the consolidation of BIBP are not measures that are defined in accordance with accounting principles generally accepted in the United States ("GAAP"). These non-GAAP measures should not be construed as a substitute for or a better indicator of the company's performance than the company's GAAP measures. Management believes the financial information excluding the impact of the consolidation of BIBP is important for purposes of comparison to prior periods and development of future projections and earnings growth prospects. Management analyzes the company's business performance and trends excluding the impact of the consolidation of BIBP because the results of BIBP are not indicative of the principal operating activities of the company. In addition, annual cash bonuses, and certain long-term incentive programs for various levels of management, are based on financial measures that exclude BIBP. Management believes these non-GAAP measures provide a more consistent view of performance than the closest GAAP equivalent for management and investors. Management compensates for this by using these measures in combination with the GAAP measures. The presentation of the non-GAAP measures in this press release is made alongside the most directly comparable GAAP measures.