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Nathan's Famous turns around to profit on hot dog sales
The Jericho-based hot dog maker Nathan's Famous Inc., founded on Coney Island in 1916, reports a substantial turnaround in profit due in part to a spike in sales to foodservice companies.
Nathan's earned $1.2 million on sales of $14.8 million for the quarter ended Dec. 25, compared with a loss of $153,000 on sales of $13 million in the same quarter last year, the company said in a Friday report to the Securities and Exchange Commission. Diluted income per share was 24 cents, compared with a loss of 3 cents in the year-ago quarter.
Friday, company shares were up 19 cents, to $21.03, on the high end of its 52-week range of $16.55 to $21.62.
Sales of branded hot dogs and other products to the foodservice industry increased by 28.6 percent; the company achieved this in part because it raised its prices earlier during the fiscal year and in part by selling more to informal eateries, such as the small cafes Sam's Club operates at its 570 stores.
The company's restaurant operations, with some locations run by the company and others by franchisees, had quarterly increases in franchise fees to $1.31 million, up from last year's $1.24 million; and an increase in franchise royalties from $1.3 million to $1.63 million.
A monthlong share repurchase by Nathan's ended in mid-January with a buyback of nearly 600,000 shares for a total cost of $13.1 million.
Famed for its beef frankfurters, made with a recipe from founder Nathan Handwerker's wife, Ada, the company has about 220 workers and a market capitalization of $104.8 million.