UNH Rosenberg Center Franchise
50 Index Surges 13.2 Percent In Q4 And Outperforms S&P 500 In
2004 With 18.5 Percent Gain
Contact: Lori Wright
UNH Media Relations
Feb. 23, 2005
Editors: Director Udo Schlentrich and senior research fellow
Hachemi Aliouche of The William Rosenberg International Center of
Franchising at the University of New Hampshire, are available to
discuss the Franchise 50 Index™ Q4 report. Udo Schlentrich
can be reached at 603-862-0137 or firstname.lastname@example.org.
Hachemi Aliouche can be reached at 603-862-6455 or email@example.com.
DURHAM, N.H. -- Carried by a broad market rally following the November
presidential elections, the Rosenberg Center Franchise 50 Index™
surged 13.2 percent in the fourth quarter of 2004 and finished the
year with an 18.5 percent gain. In contrast, the S&P 500 Index
gained 8.7 percent in the fourth quarter 2004 and 9 percent for
The Rosenberg Center Franchise 50 Index™, developed by The
William Rosenberg International Center for Franchising at the University
of New Hampshire Whittemore School of Business and Economics, is
an index that tracks the market performance of the top 50 U.S. public
franchisors. These 50 franchisors represent more than 98 percent
of the market capitalization of all U.S. public companies engaged
in business format franchising.
In 2004, the best performing RCF 50 Index™ components were
CKE Restaurants (+127.1 percent), Jack in the Box (+72.6 percent),
and Choice Hotels International (+67.4 percent). The worst performing
components were Krispy Kreme (-65.6 percent), CDI (-28.6 percent),
and Gymboree (-25.6 percent). Since January 2000, the Rosenberg
Center Franchise 50 has increased 52.3 percent, compared to a drop
of 13.1 percent in the S&P 500 over the same period.
FirstService Corp (FSRV) and CKE Restaurants Inc. (CKR) turned in
the best performances in the fourth quarter with 35.8 percent and
31.3 percent gains, respectively.
FirstService Corp. (FSRV) soared 39.4 percent after announcing strong
earnings (+30 percent growth), two acquisitions, and a 2-for-1 stock
CKE Restaurants (CKR), the owner, operator, and franchisor of the
Carl’s Jr., Hardee’s, and La Salsa Fresh Mexican Grill
food chains, jumped 31.3 percent this quarter, propelled by a 13-fold
increase in earnings. “The company’s strategy of going
against the current trend of healthier nutrition seems to be paying
off as its focus on ‘bigger, tastier’ burgers has translated
into improved sales, margins, and profits,” according to the
Rosenberg Center’s fourth quarter report.
Children’s retailer Gymboree Corp (GYMB) had the weakest performance
of the quarter, falling 11 percent. “Closure of its retail
operations in the United Kingdom and Ireland, competition from the
Children’s Place, lower margins, and lackluster growth in
same store sales resulted in a 34 percent drop in quarterly profits.
Its CFO resigned in December,” according to the report.
McDonald’s, the RCF 50 Index™ largest component, continued
to perform well, increasing 14.4 percent.
“It has become evident that the company’s strategic
turnaround plan, Plan to Win centered on operational excellence
and leadership marketing, is succeeding. McDonald’s worldwide
comparable sales have been positive for six consecutive quarters
and its profitability continues to improve. It has recently introduced
several new menu items, including more premium offerings such as
Chicken Selects and salads, new marketing programs, improved service,
and extended hours. Investors were also impressed by a seamless
leadership transition when Jim Skinner, a highly regarded McDonald’s
veteran was named CEO in November 2004 to replace Charlie Bell,
who resigned to focus on fighting colorectal cancer. Also, in December
2004, McDonald's was named the ‘Marketer of the Year’
by Advertising Age magazine for the brand's marketing achievements
around the world in 2004,” according to the fourth quarter
The full Rosenberg Center Franchise 50 Index™ fourth quarter
report is available at http://www.unh.edu/news/docs/F50Q404.pdf.
For more information on the William Rosenberg International Center
of Franchising or the Rosenberg Center Franchise 50 Index, please
visit the Center’s web site at http://franchising.unh.edu.