Krispy Kreme Begins Share Repurchase Program

The Board of Directors of Krispy Kreme Doughnuts, Inc. (NYSE: KKD) has approved a share repurchase program of up to $20 million, effective immediately. This program is intended to be implemented through purchases made from time to time either in the open market or through private transactions, in accordance with United States Securities and Exchange Commission requirements. As of March 28, 2012, the Company had approximately 68 million shares outstanding.

“This share repurchase authorization is an indication of Krispy Kreme’s financial strength as well as our positive outlook for the future,” commented James H. Morgan, Jr., Chairman and CEO. “Over the past several years, we have substantially improved our performance and strengthened our balance sheet, and are confident that we have the capital resources to implement and support our growth plans. This authorization is also consistent with our ongoing commitment to enhance long-term returns to our shareholders.”

As previously announced, the Company forecasts operating income for fiscal 2013, ending February 3, 2013, in the range of $29 to $33 million. This would represent an increase of between 13% and 29% over the $25.6 million of operating income earned in fiscal 2012. Cash provided by operating activities is forecasted to be in the range of $39 to $43 million. After deducting capital expenditures estimated at $20 million and $2 million of scheduled debt principal payments, the Company forecasts generating free cash flow in the range of $17 to $21 million in fiscal 2013. Free cash flow is a non-GAAP measure (see the reconciliation of GAAP to free cash flow in the table accompanying this release).

As of January 29, 2012, the Company’s cash balance was $44 million and unused borrowing capacity on its revolving credit facility was $15 million.

March 28, 2012