AFC Reports Financial Performance for Third Quarter 2007

Third quarter 2007 results and highlights included:

• Net income was $6.5 million, or $0.23 per diluted share, compared to $0.20 per diluted share for the third quarter of 2006. Net income includes $1.3 million associated with insurance recoveries related to Hurricane Katrina.

• Total system-wide sales increased by 2.8 percent, compared to an increase of 4.6 percent last year.

• Total domestic same-store sales decreased 1.9 percent, compared to an increase of 0.2 percent last year.

• The Popeyes system opened 32 restaurants in the third quarter, bringing total unit count to 1,881, compared to 1,845 at the end of the third quarter of last year.

• The Company repurchased approximately 816,000 shares of common stock for approximately $12.4 million.

AFC Chief Executive Officer Cheryl Bachelder stated, "Our third quarter results were in line with expectations. Same-store sales were at the lower- end of our guidance and we expect same-store sales to continue to be under pressure for the balance of this year. Our first priority going forward is to review and fully assess our operations, marketing and menu initiatives to accelerate our return to positive same-store sales. Popeyes is a highly differentiated brand with a lot of potential, and I am excited about the brand's opportunities for improved sales and future growth."

Third Quarter Performance Review Compared to Third Quarter Last Year

Total system-wide sales increased by 2.8 percent, including a 2.2 percent increase in global franchise sales to $385.8 million.

Total domestic same-store sales decreased 1.9 percent, compared to an increase of 0.2 percent last year, and global same-store sales decreased 1.7 percent, compared to flat results for the third quarter of last year. Third quarter same-store sales were soft due to weaker lunch and dinner day part traffic within the QSR segment and lower than expected results from limited- time offerings in the quarter.

Same-store sales for company-operated restaurants decreased 10.5 percent compared to a 9.6 percent increase last year. This decrease reflects the continued rollover effect of unusually high same-store sales of re-opened company-operated restaurants in New Orleans, as well as softer same-store sales in the Atlanta and Tennessee markets.

Total revenues were $38.9 million, a $2.9 million increase over the third quarter of 2006. This increase was comprised of approximately $2.8 million from the re-opening of company-operated restaurants in New Orleans, $1.0 million from new openings of company-operated restaurants in Atlanta, and a $1.0 million increase in franchise revenue, primarily driven by sales from new franchised restaurants. These increases in total revenues were partially offset by a reduction of $1.9 million from negative same-store sales.

General and administrative expenses were $11.3 million at 29.0 percent of total revenues, compared to $9.6 million at 26.7 percent of total revenues. This increase was primarily due to higher professional and legal fees and severance costs, which were partially offset by a reduction in equity incentive payments to management due to lower sales performance.

Other income was $1.3 million, which included a gain from hurricane insurance recoveries, compared to other income of $0.4 million last year.

Operating profit was $11.9 million, which was the same as operating profit of $11.9 million in the third quarter of last year.

Net income was $6.5 million, or $0.23 per diluted share, compared to net income of $5.9 million, or $0.20 per diluted share last year. Net income for the first three quarters of 2007 was $19.5 million, or $0.67 per diluted share, compared to net income of $16.8 million, or $0.56 per diluted share for the first three quarters of 2006.

During the third quarter, the Company repurchased approximately 816,000 shares of its common stock for approximately $12.4 million. AFC repurchased more than 2,116,000 shares of common stock for approximately $35.2 million through November 2, 2007. The remaining value of shares that may be repurchased under the current board-approved, multi-year stock repurchase authorization is approximately $12.0 million. As of November 2, 2007, approximately 27.7 million shares of the Company's common stock were outstanding.

During the quarter, Popeyes opened 32 restaurants, compared to 26 openings last year. New openings for the third quarter included 19 domestic restaurants and 13 international restaurants. During the first three quarters of 2007, Popeyes opened 85 restaurants, which included 58 domestic restaurants and 27 international restaurants. Popeyes had 30 restaurant closures in the third quarter, consisting of 22 domestic units and 8 international units, of which 6 were in Korea.

On a system-wide basis, Popeyes had 1,881 units operating at the end of the third quarter, compared to 1,845 units at the end of the third quarter last year. Total unit count was comprised of 1,567 domestic units and 314 units in 24 foreign countries and two territories. Of this total, 1,820 were franchised and 61 were company-operated restaurants.

Fiscal 2007 Guidance Update

Given the same-store sales performance through the third quarter and continued pressures experienced in the beginning of the fourth quarter, the Company expects its domestic same-store sales for full year to be at negative approximately 2.5 percent compared to previous guidance of negative approximately 2.0 percent.

For fiscal 2007, new restaurant openings are expected to be at the lower- end of previous guidance in the range of 155-165 restaurants. The Company also expects restaurant closures to be consistent with previous guidance in the range of 100-110. Net new openings in fiscal 2007 are expected to remain consistent with previous guidance at 45-65.

The Company's general and administrative expenses in fiscal 2007 are expected to be consistent with previous guidance of $48-$50 million.

Net earnings per diluted share for fiscal 2007 are expected to be in the range of $0.78-$0.80 compared to previous guidance at the lower-end of the range of $0.81-$0.85. This guidance reflects the impact of lower same-store sales and recently implemented management costs and marketing investments, partially offset by $1.3 million recognized in the third quarter for insurance recoveries related to Hurricane Katrina.

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