Revenue during the quarter went up marginally by 2.62 percent to $127.91 million from $124.64 million in the previous year period. Gross margin for the quarter contracted 99 basis points over the previous year period to 31.53 percent. Total expenses were 87.26 percent of quarterly revenues, up from 85.37 percent for the same period last year. That has resulted in a contraction of 188 basis points in operating margin to 12.74 percent.

Operating income for the quarter was $16.30 million, compared with $18.23 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $19.83 million compared with $22.53 million in the prior year period. At the same time, adjusted EBITDA margin contracted 257 basis points in the quarter to 15.50 percent from 18.07 percent in the last year period.

John Miller, President and Chief Executive Officer, stated, “Our highly franchised business model continued to generate operating revenue growth and strong Free Cash Flow* as we work to further differentiate Denny's as a relevant and compelling brand. Despite the influence of industry competitive pressures and holiday shifts, the Company outperformed key industry benchmarks during the first quarter, and we have been encouraged by our sales performance in April. We continue to successfully execute our brand revitalization strategy which delivers an enhanced guest experience across food, service, and atmosphere. Moving forward, despite an uncertain industry outlook, Denny’s remains committed to further elevating the guest experience, consistently growing sales, and expanding the brand across the globe, leading to value creation for all franchisees and shareholders.”

For fiscal year 2017, Denny's Corporation expects revenue to be in the range of $523 million to $532 million.