Jack in the Box (JACK) 8-K Jack in the Box Inc. Reports Second Quarter FY 2009 Earnings and Updates FY 2009 Guidance

Exhibit 99.1

Jack in the Box Inc. Reports Second Quarter FY 2009 Earnings and Updates FY 2009 Guidance

SAN DIEGO--(BUSINESS WIRE)--May 13, 2009--Jack in the Box Inc. (NASDAQ:JACK) today reported earnings from continuing operations of $29.6 million, or 51 cents per diluted share, for the second quarter ended April 12, 2009, compared with earnings from continuing operations of $26.3 million, or 44 cents per diluted share, for the second quarter of fiscal 2008. As previously announced, in September 2008 the company’s board of directors approved plans to sell its Quick Stuff® convenience stores. The results of operations for Quick Stuff are included in discontinued operations in the accompanying consolidated statements of earnings for all periods presented.

Second quarter FY 2009 highlights

Same-store sales at Jack in the Box® company restaurants increased 0.4 percent in the second quarter compared with a year-ago decrease of 0.1 percent. Same-store sales remained positive in California, Texas and Las Vegas, and although still negative in Phoenix, same-store sales continued to improve versus the prior quarter.

System same-store sales at Qdoba Mexican Grill® decreased 2.3 percent in the second quarter versus a year-ago increase of 2.4 percent, as the economic environment continued to pressure consumer spending at restaurants with higher check averages and negatively impacted catering sales at Qdoba.

Consolidated restaurant operating margin was 16.5 percent of sales in the second quarter of 2009, equal to the year-ago quarter and a significant improvement from 14.6 percent of sales in the first quarter of fiscal 2009. Food and packaging costs were 80 basis points better than prior year as a result of favorable product mix, the benefit of a 2.5 percent price increase taken in November, as well as the company’s margin-improvement initiatives. Commodity costs were approximately 3.3 percent higher in the quarter versus prior year and as compared to commodity cost inflation of nearly 8 percent in the first quarter of fiscal 2009. Beef costs were up 6.6 percent over last year in the second quarter. Restaurant operating costs were 51.3 percent of restaurant sales, consistent with 51.4 percent in the first quarter and 80 basis points higher than last year. The increase from prior year is due primarily to higher depreciation resulting from the kitchen enhancement program completed in fiscal 2008 and the ongoing re-image program at Jack in the Box, as well as higher rent and depreciation related to new restaurant development and sales deleverage at Qdoba. Restaurant operating margin is expected to continue to improve in the second half of the fiscal year due primarily to lower anticipated food cost inflation, lower utility costs, and margin-improvement initiatives.

Linda A. Lang, chairman and chief executive officer, said, “We’re pleased that, despite the continued recessionary environment, the Jack in the Box brand achieved positive comparable sales growth during the quarter while the company delivered strong sequential improvement in consolidated restaurant operating margin.”

SG&A expense was 11.6 percent of revenues in the second quarter compared with 11.1 percent last year. Impairment charges of approximately $3.2 million negatively impacted SG&A by approximately 55 basis points in the 2009 quarter.

The company’s refranchising efforts continued on pace with its expectations despite the tight credit markets. Gains on the sale of 46 company-operated Jack in the Box restaurants to franchisees totaled $17.2 million in the second quarter compared with $11.6 million in the year-ago quarter from the sale of 23 restaurants. Average gains were lower than in recent quarters due to lower-than-average sales volumes and cash flows of the restaurants sold. Through the first half of fiscal 2009, the company refranchised 75 Jack in the Box restaurants, with gains totaling $35.6 million.

The company provided $3.3 million in bridge and mezzanine financing during the quarter for two of the six refranchising transactions. As of the end of the second quarter, notes receivable from franchisees relating to refranchising activity totaled $9.3 million.

The Jack in the Box system is now 41 percent franchised versus 35 percent a year ago. The company remains on track to achieve its long-term goal to increase the percentage of franchise ownership in the Jack in the Box system to 70 to 80 percent by the end of fiscal year 2013.

The tax rate for the second quarter was 39.0 percent compared with 36.5 percent in the prior year, with the increase due primarily to market performance of insurance investment products used to fund certain non-qualified retirement plans. Changes in the cash value of the insurance products are not deductible or taxable.

Restaurant openings

Eighteen new Jack in the Box restaurants opened in the second quarter, including 14 company locations, compared with 6 new restaurants opened systemwide during the same quarter last year.

“Through the first half of fiscal 2009, 34 new Jack in the Box restaurants opened, compared to 16 in the first half of last year,” Lang said. “We have a strong pipeline of company and franchised sites in various stages of planning and development and continue to expect approximately 50 new restaurant openings for the full year.”

In the second quarter, 15 Qdoba restaurants opened, including 8 franchised locations, versus 9 new restaurants in the year-ago quarter, 6 of which were franchised. Through the first half of fiscal 2009, 32 new Qdoba restaurants opened, including 23 franchised locations. The company now expects 55 to 70 new Qdoba openings in fiscal 2009, including approximately 25 company locations.

At April 12, 2009, the company’s system total comprised 2,186 Jack in the Box restaurants, including 894 franchised locations, and 484 Qdoba restaurants, including 342 franchised locations.

Second quarter FY 2009 initiatives

During the quarter, the company continued to execute its strategic initiative to reinvent the Jack in the Box brand. This initiative is expected to drive sales by offering guests a better restaurant experience than typically found in the QSR segment through menu innovation, enhanced restaurant facilities and improvements in guest service.

Jack in the Box enhanced its menu with several new products during the quarter:

• In late March, Mini Sirloin Burgers were launched as a new product platform. This premium product, which rivals the quality and taste of similar items offered by casual dining restaurants, features a trio of 100% sirloin patties topped with American cheese, grilled onions and ketchup served on mini buns inspired by Hawaiian sweet rolls.
• Teriyaki Bowls, introduced in the first quarter in the chain’s western division, were rolled out to the rest of the system in late January. Available in two varieties, the Teriyaki Bowls include steamed rice, broccoli and carrots with a choice of all-white-meat chicken or sirloin steak topped with teriyaki sauce.
• The Homestyle Ranch Chicken Club, introduced in the chain’s central and eastern U.S. locations in the first quarter, was rolled out to the remainder of the system in late January.
• Taco Nachos were added as a value-priced item in late January. The new product features the chain’s popular crunchy tacos topped with cheddar cheese sauce, melted pepper jack cheese and jalapeno slices served with a side of fire-roasted salsa.
• Additionally, Jack in the Box offered a limited-time value promotion beginning in February that featured two fish sandwiches for $3.

A major element of the company’s strategic initiative to reinvent the Jack in the Box brand is a comprehensive restaurant re-imaging program. Approximately 44 percent of the Jack in the Box system, including new construction, now features all interior and exterior elements of the program. Exterior enhancements, including new paint schemes, lighting and landscaping, are now completed at 55 percent of the Jack in the Box system.

Guidance (from continuing operations)

The following guidance and underlying assumptions reflect the company’s current expectations for the third quarter ending July 5, 2009, and fiscal year ending Sept. 27, 2009, in approximate amounts:

Q3 FY 2009 guidance

• Flat to 2 percent same-store sales increase at Jack in the Box company restaurants versus a 0.4 percent decrease in the year-ago quarter.

• 2 to 4 percent same-store sales decrease at Qdoba system restaurants versus a 0.5 percent increase in the year-ago quarter.

Fiscal year 2009 guidance update

• Flat to 2 percent increase in same-store sales at Jack in the Box company restaurants.
• 1 to 3 percent decrease in same-store sales at Qdoba system restaurants.
• Overall commodity costs are expected to moderate through the year, with a full-year increase of approximately 3 percent.
• Restaurant operating margin for the full year is expected to be between 16.0 and 16.5 percent.
• Approximately 50 new Jack in the Box restaurants, including approximately 35 company locations.
• 55 to 70 new Qdoba restaurants, including approximately 25 company locations.
• $60 to $70 million in gains on the sale of 120 to 140 Jack in the Box restaurants to franchisees, with $80 to $90 million in total proceeds resulting from the sales.
• $175 to $185 million in capital expenditures.
• SG&A expense related to continuing operations in the mid-11 percent range, assuming no further mark-to-market adjustments of significance.
• Tax rate of approximately 39 to 40 percent.
• For guidance purposes, share repurchases are assumed to offset dilution from stock option exercises.
• Diluted earnings per share from continuing operations of $2.08 to $2.20, including franchise gains. Earnings per share guidance from continuing operations excludes the results for Quick Stuff, which contributed 2 cents per diluted share in fiscal 2008, as well as any potential insurance recoveries related to Hurricane Ike.

Conference Call

The company will host a conference call for financial analysts and investors on Thursday, May 14, 2009, beginning at 8:30 a.m. PDT (11:30 a.m. EDT). The conference call will be broadcast live over the Internet via the Jack in the Box website. To access the live call through the Internet, log onto the Investors section of the Jack in the Box Inc. website at http://investors.jackinthebox.com at least 15 minutes prior to the event in order to download and install any necessary audio software. A replay of the call will be available through the conference-call link on the Jack in the Box Inc. home page for 21 days, beginning at approximately 11:00 a.m. PDT on May 14.

About Jack in the Box Inc.

Jack in the Box Inc. (NASDAQ: JACK), based in San Diego, is a restaurant company that operates and franchises Jack in the Box® restaurants, one of the nation’s largest hamburger chains, with more than 2,180 restaurants in 18 states. Additionally, through a wholly owned subsidiary, the company operates and franchises Qdoba Mexican Grill®, a leader in fast-casual dining, with more than 480 restaurants in 42 states and the District of Columbia. The company also operates a proprietary chain of 61 convenience stores called Quick Stuff®, each built adjacent to a full-size Jack in the Box restaurant and including a major-brand fuel station. The company has announced plans to sell its Quick Stuff brand. For more information, visit www.jackinthebox.com.

Safe harbor statement

This press release contains forward-looking statements within the meaning of the federal securities laws. Such statements are subject to substantial risks and uncertainties. A variety of factors could cause the company’s actual results to differ materially from those expressed in the forward-looking statements. These factors are discussed in the company’s annual report on Form 10-K and its periodic reports on Form 10-Q filed with the Securities and Exchange Commission which are available online at www.jackinthebox.com or in hard copy upon request. The company undertakes no obligation to update or revise any forward-looking statement, whether as the result of new information or otherwise.

JACK IN THE BOX INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Dollars in thousands, except per share data) (Unaudited)
		Twelve Weeks Ended						Twenty-Eight Weeks Ended
		April 12,			April 13,			April 12,			April 13,
			2009			2008			2009			2008
Revenues:
	Restaurant sales	$	468,326		$	490,810		$	1,096,975		$	1,138,525
	Distribution sales		67,460			61,646			158,983			142,037
	Franchised restaurant revenues		42,625			35,578			99,126			84,469
			578,411			588,034			1,355,084			1,365,031
Operating costs and expenses:
	Restaurant costs of sales		150,738			161,971			364,626			374,734
	Restaurant operating costs		240,291			247,790			563,574			572,302
	Distribution costs of sales		67,035			61,439			157,614			141,349
	Franchised restaurant costs		17,561			14,892			39,690			33,840
	Selling, general and administrative expenses		66,910			65,342			157,689			155,432
	Gains on the sale of company-operated restaurants		(17,234	)		(11,629	)		(35,595	)		(27,978	)
			525,301			539,805			1,247,598			1,249,679
Earnings from operations			53,110			48,229			107,486			115,352
Interest expense			4,979			6,777			13,180			15,854
Interest income			(406	)		(42	)		(880	)		(293	)
	Interest expense, net		4,573			6,735			12,300			15,561
Earnings from continuing operations and before income taxes			48,537			41,494			95,186			99,791
Income taxes			18,951			15,156			37,633			37,154
Earnings from continuing operations			29,586			26,338			57,553			62,637
Earnings (losses) from discontinued operations, net			275			(104	)		705			(148	)
Net earnings		$	29,861		$	26,234		$	58,258		$	62,489
Net earnings per share - basic:
	Earnings from continuing operations	$	0.52		$	0.45		$	1.02		$	1.06
	Earnings (losses) from discontinued operations, net		0.01			(0.00	)		0.01			(0.00	)
Net earnings per share		$	0.53		$	0.45		$	1.03		$	1.06
Net earnings per share - diluted:
	Earnings from continuing operations	$	0.51		$	0.44		$	1.00		$	1.04
	Earnings (losses) from discontinued operations, net		0.01			(0.00	)		0.01			(0.01	)
Net earnings per share		$	0.52		$	0.44		$	1.01		$	1.03
Weighted-average shares outstanding:
	Basic		56,714			58,833			56,644			59,229
	Diluted		57,704			59,953			57,554			60,488

JACK IN THE BOX INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except per share data) (Unaudited)
			April 12,			September 28,
				2009			2008
ASSETS
Current assets:
	Cash and cash equivalents		$	11,008		$	47,884
	Accounts and other receivables, net			65,257			70,290
	Inventories			41,122			45,206
	Prepaid expenses			28,971			20,061
	Deferred income taxes			46,166			46,166
	Assets held for sale			135,819			112,994
	Other current assets			5,967			7,480
		Total current assets		334,310			350,081
Property and equipment, at cost				1,609,352			1,605,497
Less accumulated depreciation and amortization				(663,055	)		(662,435	)
	Property and equipment, net			946,297			943,062
Other assets, net				206,924			205,275
			$	1,487,531		$	1,498,418
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
	Current maturities of long-term debt		$	24,587		$	2,331
	Accounts payable			70,712			99,708
	Accrued liabilities			217,010			213,631
		Total current liabilities		312,309			315,670
Long-term debt, net of current maturities				451,347			516,250
Other long-term liabilities				155,493			161,277
Deferred income taxes				47,114			48,110
Stockholders’ equity:
	Preferred stock $.01 par value, 15,000,000 authorized, none issued			-			-
	Common stock $.01 par value, 175,000,000 authorized, 73,773,394 and
	73,506,049 issued, respectively			738			735
	Capital in excess of par value			162,254			155,023
	Retained earnings			853,915			795,657
	Accumulated other comprehensive loss, net			(21,180	)		(19,845	)
	Treasury stock, at cost, 16,726,032 shares			(474,459	)		(474,459	)
		Total stockholders' equity		521,268			457,111
			$	1,487,531		$	1,498,418

JACK IN THE BOX INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) (Unaudited)
			Twenty-Eight Weeks Ended
			April 12,			April 13,
				2009			2008
Cash flows from operating activities:
	Net earnings		$	58,258		$	62,489
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization		53,887			53,908
		Deferred finance cost amortization		836			837
		Deferred income taxes		(168	)		(1,472	)
		Share-based compensation expense awards		4,962			5,385
		Pension and postretirement expense		6,594			7,797
		Losses on cash surrender value of company-owned life insurance		10,006			3,883
		Gains on the sale of company-operated restaurants		(35,595	)		(27,978	)
		Gains on the acquisition of franchise-operated restaurants		(958	)		-
		Losses on the disposition of property and equipment, net		5,784			8,967
		Impairment charges		4,857			1,461
	Changes in assets and liabilities, excluding acquisitions and dispositions:
		Increase in receivables		(10,957	)		(9,032	)
		Decrease in inventories		4,985			128
		Decrease (increase) in prepaid expenses and other current assets		(5,856	)		5,491
		Decrease in accounts payable		(14,913	)		(13,986	)
		Pension and postretirement contributions		(9,524	)		(9,201	)
		Increase (decrease) in other liabilities		(4,857	)		17,563
		Cash flows provided by operating activities		67,341			106,240
Cash flows from investing activities:
	Purchases of property and equipment			(92,020	)		(91,322	)
	Proceeds from the sale of company-operated restaurants			40,429			36,053
	Purchase of assets held for sale and leaseback, net			(22,760	)		(1,362	)
	Collections on notes receivable			21,356			23
	Acquisition of franchise-operated restaurants			(6,760	)		-
	Other			(2,093	)		(2,995	)
		Cash flows used in investing activities		(61,848	)		(59,603	)
Cash flows from financing activities:
	Borrowings on revolving credit facility			246,000			248,000
	Repayments of borrowings on revolving credit facility			(287,000	)		(248,000	)
	Principal payments on debt			(1,647	)		(3,408	)
	Proceeds from issuance of common stock			2,136			7,649
	Repurchase of common stock			-			(50,000	)
	Excess tax benefits from share-based compensation arrangements			450			4,202
	Change in book overdraft			(2,308	)		(4,382	)
		Cash flows used in financing activities		(42,369	)		(45,939	)
Net increase (decrease) in cash and cash equivalents				(36,876	)		698
Cash and cash equivalents at beginning of period				47,884			15,702
Cash and cash equivalents at end of period			$	11,008		$	16,400

JACK IN THE BOX INC. AND SUBSIDIARIES SUPPLEMENTAL INFORMATION (Unaudited)
The following table sets forth, unless otherwise indicated, the percentage relationship to total revenues of certain items included in our consolidated statements of earnings:
		Twelve Weeks Ended				Twenty-Eight Weeks Ended
		April 12,		April 13,		April 12,		April 13,
		2009		2008		2009		2008
Statement of Earnings Data:
Revenues:
	Restaurant sales	81.0	%	83.5	%	81.0	%	83.4	%
	Distribution sales	11.7	%	10.5	%	11.7	%	10.4	%
	Franchised restaurant revenues	7.3	%	6.0	%	7.3	%	6.2	%
Total revenues		100.0	%	100.0	%	100.0	%	100.0	%
Operating costs and expenses:
	Restaurant costs of sales (1)	32.2	%	33.0	%	33.2	%	32.9	%
	Restaurant operating costs (1)	51.3	%	50.5	%	51.4	%	50.3	%
	Distribution costs of sales (1)	99.4	%	99.7	%	99.1	%	99.5	%
	Franchised restaurant costs (1)	41.2	%	41.9	%	40.0	%	40.1	%
	Selling, general and administrative expenses	11.6	%	11.1	%	11.6	%	11.4	%
	Gains on sale of company-operated restaurants	(3.0	%)	(2.0	%)	(2.6	%)	(2.0	%)
Earnings from operations		9.2	%	8.2	%	7.9	%	8.5	%
Income tax rate (2)		39.0	%	36.5	%	39.5	%	37.2	%
(1) As a percentage of the related sales and/or revenues
(2) As a percentage of earnings from continuing operations and before income taxes.

The following table summarizes the changes in the number of company-operated and franchised Jack in the Box and Qdoba restaurants during the quarter:
			Twenty-Eight Weeks Ended April 12, 2009						Twenty-Eight Weeks Ended April 13, 2008
			Company		Franchised		Total		Company		Franchised		Total
Jack in the Box:
	Beginning of period		1,346		812		2,158		1,436		696		2,132
		New	26		8		34		11		5		16
		Franchised	(75	)	75		-		(51	)	51		-
		Closed	(5	)	(1	)	(6	)	(3	)	(3	)	(6	)
	End of period		1,292		894		2,186		1,393		749		2,142
		% of system	59	%	41	%	100	%	65	%	35	%	100	%
Qdoba:
	Beginning of period		111		343		454		90		305		395
		New	9		23		32		7		27		34
		Acquired	22		(22	)	-		-		-		-
		Closed	-		(2	)	(2	)	-		(6	)	(6	)
	End of period		142		342		484		97		326		423
		% of system	29	%	71	%	100	%	23	%	77	%	100	%
Consolidated:
	Total system		1,434		1,236		2,670		1,490		1,075		2,565
		% of system	54	%	46	%	100	%	58	%	42	%	100	%

CONTACT:
Jack in the Box Inc.
Investor Contact:
Carol DiRaimo, 858-571-2407
or
Media Contact:
Brian Luscomb, 858-571-2291