Dunkin' Brands Group posted lower-than-expected quarterly revenue on Thursday, hurt by fewer restaurant openings and a drop in sales at established Baskin-Robbins outlets in the United States.
U.S. restaurants are battling intense competition from upstart chains and meal-kit sellers, and getting battered by lower grocery prices, which are encouraging customers to cook more at home.
Dunkin' (dnkn) cut its revenue growth forecast for 2016 to about 2%, from 3-5%, citing weaker-than-expected sales at its Baskin-Robbins outlets outside the United States.
Sales at U.S. Baskin-Robbins outlets open for about 18 months fell 0.9% in the third quarter ended Sept. 24. Analysts on average had expected a 0.5% rise, according to Consensus Metrix.
Net income attributable to Dunkin' Brands rose to $52.7 million, or 57 cents per share, in the quarter from $46.2 million, or 48 cents per share, a year earlier.
Excluding items, the company earned 60 cents per share.
Dunkin' said total sales fell 1.3% to $207.1 million, partly due to a decline in sales at company-operated restaurants as the company is now fully franchised.
Analysts had expected total sales of $214.4 million and earnings per share of 59 cents, according to Thomson Reuters I/B/E/S.