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Chongqing, China based Country Style Cooking Restaurant Chain Co., Ltd. recently declared its preliminary results for the fourth quarter of 2012. The company is scheduled to report its detailed fourth quarter and full year 2012 financial results in early March.

Quarter Highlights

Country Style Cooking expects fourth quarter 2012 revenues will be lower than the company’s previously provided guidance range of RMB300 million to RMB310 million. The quarterly sales are likely to be affected by the slow store-opening rate. In addition, the company projects that the comps will grow sequentially and improve through 2013.

The net income is also likely to increase year over year. However, it may be adversely affected by seasonality, increased raw material and other operating expenses.

Stores Update

At the end of the fourth quarter, the company was operating 256 restaurants versus 199 restaurants in the year-ago period. Country Style Cooking unveiled 21 restaurants with five Mr. Rice branded quick-service, canteen-style restaurants in the reported quarter.

Country Style Cooking, a quick service restaurant chain, mainly serves Sichuan-style fast food in China. It operates under the CSC brand.

Earlier in third quarter of 2012, the company reported revenues of RMB327.0 million, up 12.6% year over year buoyed by its enhanced restaurant business. Comp sales declined 5.3% year over year. The restaurant operating margin expanded 110 bps to 19.5%, attributable to the company’s cost effective initiatives.

The company has projected that its revenue for the full year of 2012 will be within the range of RMB1,192 million to RMB1,202 million, up 17% to 18% year over year respectively.

Country Style Cooking currently retains a Zacks Rank #3 (Hold). Moving ahead, restaurateurs, which are also expected to perform well, include Bob Evans Farms, Inc. (BOBE - Snapshot Report), Krispy Kreme Doughnuts Inc. (KKD - Snapshot Report) and AFC Enterprises Inc. . Bob Evans and Krispy Kreme Doughnuts currently carry a Zacks Rank #1 (Strong Buy) whereas AFC Enterprises carries a Zacks Rank #2 (Buy).

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