Wendy's Reports Strong First Quarter Sales and Earnings

/ Total EPS Increased 39% to $0.25, Domestic Margins ExpandedFrom 13.4% to 15.8% Dublin, Ohio (PROTEXT) - Wendy's International, Inc. (NYSE:WEN) today announced very strong sales and earnings results forthe first quarter, which ended on April 4, 1999. The results wereannounced during the Company's annual meeting of shareholders.Highlights from the quarter included: * Systemwide sales increased 12% to a record $1.63 billionand revenues increased from $456 million a year ago to $477million. * At Wendy's(R) Company operated restaurants in the UnitedStates, average unit volumes (AUVs) increased 13% and same-storesales were up 10%. AUVs at Wendy's franchised units in the U.S.increased 9.5%. * Tim Hortons' same-store sales in Canada increased 10% andsame-store sales in the U.S. were also positive. * Net income was $32 million, up 34% from $24 million a yearago. * Total diluted earnings per share were $0.25, up 39%compared to $0.18 a year ago. Total EPS for the quarter included$0.01 in asset gains from the sale of real estate, franchisingand fees from refinancing notes. In the first quarter a year ago,total EPS included an insignificant amount of gains. * Base EPS (total diluted EPS less gains) was $0.24 for thequarter, up 33% compared to last year. * Wendy's first quarter domestic operating margin increasedfrom 13.4% to 15.8% due primarily to the strong sales growth atCompany stores, and franchising underperforming Company unitsduring the first quarter of 1998. 1ST QUARTER DILUTED EARNINGS PER SHARE

1Q-99

1Q-98 Base EPS

$0.24

$0.18 Gains

$0.01

$0.00 Total EPS

$0.25

$0.18 "We delivered an outstanding quarter with sales at Wendy'sNorth America and Tim Hortons(R) Canada well above expectations,"said Chairman, CEO and President Gordon F. Teter. "In particular,sales in March and early April were outstanding, even with GoodFriday and Easter falling into our fiscal first quarter. Thoseholidays typically have a negative impact on sales. "The strong sales performance at Wendy's U.S. stretches overnearly three years as March was the 35th consecutive month ofpositive AUVs." Several factors contributed to the outstanding first quarterperformance: * Improved restaurant operations at Wendy's and Tim Hortons. * Balanced and effective product-focused marketing. * Successful promotional products (Monterey Ranch Chicken(TM)sandwich at Wendy's and Cafe Mocha at Tim Hortons). * Effective corporate and store-level cost controls. * A strong economy in North America. "The Monterey Ranch Chicken sandwich was a huge success withour customers, who have become accustomed to great tasting, highquality products from Wendy's," said Teter. "Customers reactedfavorably to the new Cafe Mocha drink at Tim Hortons, whichfollowed last year's successful introduction of flavoredcappuccino. "Most importantly, our success with new products affirmsWendy's and Tim Hortons' quality brand positions. Our long-termcommitment to product research and development and superiorstore-level operations continues to pay off," said Teter. The Company has two new products in stores. At Wendy's, a newCheddar Lovers' Bacon Cheeseburger(TM) is available as apromotional item. At Tim Hortons, a new iced cappuccino drink hasbeen added to the menu at all stores. "Our strong momentum has continued into the second quarter,"said Teter. "Same-store sales at Wendy's in the U.S. during Aprilincreased in the high single digits and same-store sales at TimHortons in Canada are up more than 10% in April." Management Raising 1999 Base EPS Goal Due to the strong first quarter, management is raising itsgoal for 1999 Base EPS growth to a range of 16% to 18%. The newgoal is higher than the Base EPS growth goal of 15% to 17.5%announced in March and up from the original goal of 12% to 15%.Base EPS was $1.03 in 1998, excluding non- recurring charges.Total EPS for 1999 is expected to include $.06 to $.07 in assetgains. "Our first quarter performance was very encouraging," saidFrederick R. Reed, Chief Financial Officer. "Not only did theCompany achieve excellent sales results, but we controlled costseffectively and delivered strong flow through to the bottom line.We also made progress on several strategic initiatives." Strategic Initiatives and Return on Capital The Company is making progress on its strategy to improvereturn on invested capital (ROIC). The initial steps included the1998 closing and refranchising of underperforming Wendy's andinitiating several store-level productivity programs to helpimprove domestic margins. Progress during the first quarterincluded: * Utilizing cash from the balance sheet to repurchase 597,000common shares for $15.3 million. Since announcing its plan torepurchase a total of $350 million in common shares, the Companyhas repurchased $226 million through the end of the quarter. * Completing about $38 million of a program to refinance withthird-party lenders up to $150 million in notes receivable heldby the Company. A total of $86 million in notes has beenrefinanced since early 1998. Cash generated from the refinancingis intended for share repurchase. * Completing the sale of 26 Wendy's properties tofranchisees. The Company has sold a total of about 170 leaseproperties since early 1998 and continues to evaluate the sale ofa portion of nearly 600 remaining properties. Dividend Approved, Directors Re-elected At the annual meeting of shareholders, the Board of Directorsapproved a quarterly dividend of 6 cents per share, payable onMay 28 to shareholders of record as of May 14. It will be theCompany's 85th consecutive dividend payment to shareholders. Also at the annual meeting, W. Clay Hamner, Ronald E Musick,Frederick R. Reed, Thekla R. Shackelford and Gordon F. Teter werere-elected to three-year terms as directors of the Company.Additionally, shareholders ratified the selection ofPricewaterhouseCoopers LLP as independent public accountants andapproved the performance goals of the executive bonus plan. Wendy's International, Inc. is one of the world's largestrestaurant operating and franchising companies with $6.5 billionin systemwide sales during 1998. Wendy's Old Fashioned Hamburgerswas founded in 1969 by Dave Thomas and is the third-largestquick-service hamburger restaurant chain with more than 5,300units in the United States, Canada and other internationalmarkets. Tim Hortons was founded in 1964 by Tim Horton and RonJoyce and is the largest coffee and baked goods restaurant chainin Canada. There are nearly 1,700 Tim Hortons restaurants inNorth America.

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SECURITIES LITIGATION REFORM ACT OF 1995 Certain information in this news release, particularlyinformation regarding future economic performance and finances,and plans, expectations and objectives of management, is forwardlooking. The following factors, in addition to other possiblefactors not listed, could affect the Company's actual results andcause such results to differ materially from those expressed inforward-looking statements: Competition: The quick-service restaurant industry isintensely competitive with respect to price, service, location,personnel, and type and quality of food. The Company and itsfranchisees compete with international, regional, and localorganizations primarily through the quality, variety, and valueperception of food products offered. The number and location ofunits, quality and speed of service, attractiveness offacilities, effectiveness of advertising and marketing programs,and new product development by the Company and its competitorsare also important factors. The Company anticipates that intensecompetition will continue to focus on pricing. Certain of theCompany's competitors have substantially larger marketingbudgets. Economic, Market and Other Conditions: The quick-servicerestaurant industry is affected by changes in national, regional,and local economic conditions, consumer preferences and spendingpatterns, demographic trends, consumer perceptions of foodsafety, weather, traffic patterns, and the type, number andlocation of competing restaurants. Factors such as inflation,food costs, labor and benefit costs, legal claims, and theavailability of management and hourly employees also affectrestaurant operations and administrative expenses. The ability ofthe Company and its franchisees to finance new restaurantdevelopment, improvements and additions to existing restaurants,and the acquisition of restaurants from, and sale of restaurantsto franchisees is affected by economic conditions, includinginterest rates and other government policies impacting land andconstruction costs and the cost and availability of borrowedfunds. Importance of Locations: The success of Company and franchisedrestaurants is dependent in substantial part on location. Therecan be no assurance that current locations will continue to beattractive, as demographic patterns change. It is possible theneighborhood or economic conditions where restaurants are locatedcould decline in the future, thus resulting in potentiallyreduced sales in those locations. Government Regulation: The Company and its franchisees aresubject to various federal, state, and local laws affecting theirbusiness. The development and operation of restaurants depend toa significant extent on the selection and acquisition of suitablesites, which are subject to zoning, land use, environmental,traffic, and other regulations. Restaurant operations are alsosubject to licensing and regulation by state and localdepartments relating to health, sanitation and safety standards,federal and state labor laws (including applicable minimum wagerequirements, overtime, working and safety conditions, andcitizenship requirements), federal and state laws which prohibitdiscrimination, and other laws regulating the design andoperation of facilities, such as the Americans with DisabilitiesAct of 1990. Changes in these laws and regulations, particularlyincreases in applicable minimum wages, may adversely affectfinancial results. The operation of the Company's franchiseesystem is also subject to regulation enacted by a number ofstates and rules promulgated by the Federal Trade Commission. TheCompany cannot predict the effect on its operations, particularlyon its relationship with franchisees, of the future enactment ofadditional legislation regulating the franchise relationship. Growth Plans: The Company plans to increase the number ofsystemwide Wendy's and Tim Hortons restaurants open or underconstruction. There can be no assurance that the Company or itsfranchisees will be able to achieve growth objectives or that newrestaurants opened or acquired will be profitable. The opening and success of restaurants depends on variousfactors, including the identification and availability ofsuitable and economically viable locations, sales levels atexisting restaurants, the negotiation of acceptable lease orpurchase terms for new locations, permitting and regulatorycompliance, the ability to meet construction schedules, thefinancial and other development capabilities of franchisees, theability of the Company to hire and train qualified managementpersonnel, and general economic and business conditions. International Operations: The Company's business outside ofthe United States is subject to a number of additional factors,including international economic and political conditions,differing cultures and consumer preferences, currency regulationsand fluctuations, diverse government regulations and tax systems,uncertain or differing interpretations of rights and obligationsin connection with international franchise agreements and thecollection of royalties from international franchisees, theavailability and cost of land and construction costs, and theavailability of experienced management, appropriate franchisees,and joint venture partners. Although the Company believes it hasdeveloped the support structure required for internationalgrowth, there is no assurance that such growth will occur or thatinternational operations will be profitable. Disposition of Restaurants: The disposition of company-operated restaurants to new or existing franchisees is part ofthe Company's strategy to develop the overall health of thesystem by acquiring restaurants from, and disposing ofrestaurants to, franchisees where prudent. The expectation ofgains from future dispositions of restaurants depends in part onthe ability of the Company to complete disposition transactionson acceptable terms. Transactions to Improve Return on Investment: The Company ownsseveral notes receivable issued by franchisees. The Company hasentered into an agreement with a third party lender that permitsthe lender to contact franchisees, offer to refinance notes andenter into commitments to refinance such notes on or before March31, 1999. The Company expects that a substantial portion of thenotes will be refinanced. However, franchisees could decide tonot refinance for various reasons, including changes in economic,credit market or other conditions, and the Company cannot requirefranchisees to refinance. In addition, the timing of refinancingtransactions would be controlled by the lender and franchisees.As a result, there is no assurance as to when the Company couldreceive cash proceeds or realize income from refinancingtransactions. The sale of real estate previously leased to franchisees isgenerally part of the program to improve the Company's return oninvested capital. There are various reasons why the program mightbe unsuccessful, including changes in economic, credit market,real estate market or other conditions, and the ability of theCompany to complete sale transactions on acceptable terms and ator near the prices estimated as attainable by the Company. Year 2000: The Company anticipates timely completion of itsprogram to address year 2000 issues. However, if the newinformation systems are not implemented on a timely basis,modifications to existing systems cannot be accomplished on atimely basis, information technology resources do not remainavailable, or other unanticipated events occur, there would beadverse financial and operational effects on the Company. Theamount of these effects cannot be ascertained at this time. Although the Company has not been informed of material year2000 issues by third parties with which it has a materialrelationship or franchisees, there is no assurance that theseentities will be year 2000 compliant on a timely basis.Unanticipated failures or significant delays in furnishingproducts or services by third parties or general publicinfrastructure service providers, or the inability of franchiseesto perform sales reporting and financial management functions orto make timely payments to the Company or suppliers, could have amaterial adverse effect on results of operations, financialcondition and/or liquidity. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date thereof. TheCompany undertakes no obligation to publicly release anyrevisions to the forward-looking statements contained in thisrelease, or to update them to reflect events or circumstancesoccurring after the date of this release, or to reflect theoccurrence of unanticipated events. ots Original Text Service:Wendy's International, Inc. Internet: http://www.newsaktuell.deContact: John D. Barker of Wendy's International,Inc. (USA)614-764-3044 Web site: http://www.wendys.com

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