Analyst: Shootings Won't Affect Denny's

By JOHN C. DRAKE Posted 18 March 2006 @ 04:35 am EET     Print     Reprint     E-Mail     Comments

COLUMBIA, S.C. (AP) - A string of three fatal shootings at Denny's restaurants in California are unlikely to affect the company known for serving "Grand Slam" breakfasts financially, a Wall Street analyst said Friday.

"It's just random things, and so there's no real link to the restaurant," said Mark Smith, an analyst with Sidoti & Co. "I don't see any large impact on business due to these shootings."

But the Spartanburg, S.C.-based company has struggled with its corporate image for years, and one former Denny's board member said any negative news could leave a bad taste in the mouths of potential customers.

"It certainly doesn't help," said Darrell Jackson, who now owns a Columbia public relations firm.

One man was killed and another seriously injured early Friday when a gunman opened fire in the third fatal shooting at the restaurant chain this week in Southern California.

In a statement, Denny's Corp. called the incidents "most unfortunate and tragic."

Spokeswoman Debbie Atkins said the company was evaluating its security procedures but that "no sweeping changes" were planned.

"We see these as separate, random acts of violence," Atkins said. "Unfortunately they occur in the communities we serve and throughout our nation and the world."

The company said it was cooperating with law enforcement in the investigations of the shootings.

"We remain committed to serving our guests around the clock and redoubling our efforts to provide a safe and welcoming environment in all of our communities," the company's statement read.

Denny's has mounted an intense public relations campaign during the past decade to counter allegations of racism that dogged the company.

Those efforts have been largely successful, said Jackson, a state senator and pastor of a large predominantly black church who consulted Denny's in its race relations efforts and was later named to the company's board.

The restaurant chain settled a class-action lawsuit for $45.7 million in 1994 after allegations of dozens of incidents of racial discrimination across the country. Since then, it has been praised for its diversity efforts by the National Association for the Advancement of Colored People.

The company will always have to be vigilant about its image, Jackson said. He said the company should aggressively tout the safety of its restaurants to the public.

"These incidents do not help, because it's really hard to shake a negative public image," he said. "All it takes is one incident, and then it's like a flashback in people's mind."