UPDATE 2-Wendy's raises profit forecast on breakfast menu strength

(Adds shares, background, Q1 earnings numbers)

May 12 (Reuters) - Wendy's Co raised its annual forecast for earnings on Wednesday, betting that its revamped, bacon-loaded breakfast menu would bring in more customers as restaurants reopen for dining after restrictions were eased.

Shares of the company rose about 5% to $24.05 in premarket trading as the burger chain also beat Wall Street estimates for quarterly same-store sales in the United States.

Wendy's is readying for customers to return to its restaurants with new launches like the fried chicken sandwich, to tackle that of its competition, iced beverages and its popular breakfast offerings.

The company had invested millions of dollars in its breakfast menu over the past year to hire staff and market its morning offerings, which accounts for about a tenth of its total sales.

For the year, Wendy's expects adjusted earnings to be between 72 cents and 74 cents per share, up from its prior projection of 67 cents to 69 cents.

Global systemwide sales, or the total sales for both franchise and company restaurants, is expected to grow in the range of 8% to 10%, up from its earlier forecast of 6% to 8%.

Wendy's also hiked its quarterly dividend by 11% to 10 cents per share.

For the first quarter, U.S. same-store sales rose 13.5%, beating expectations of 9.84%, according to IBES data from Refinitiv.

On an adjusted basis, it earned 20 cents per share, 5 cents more than estimates.

(Reporting by Nivedita Balu in Bengaluru; Editing by Amy Caren Daniel)

05/12/2021 12:18

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