Shares in DineEquity Inc. dropped 5 percent early Tuesday after the casual dining chain said it swung to a loss in the second quarter due to hefty charges related to buying and franchising the Applebee’s chain.

Dine Equity, formerly known as IHOP Corp., reported a loss of $19.4 million (-$1.42 per share), a sharp contrast to a profit of $14.1 million (82 cents) in the same period a year earlier.

Excluding impairment, early debt retirement costs and closure charges related to the $2 billion Applebee’s deal, DineEquity said it earned 10 cents per share which was just off Wall Street’s predictions of 11 cents per share, according to Thomson Financial.

Dine Equity ate a $41.1 million impairment charge which stemmed from the sale and leaseback of 181 company-owned Applebee’s restaurants. The sale-leasebacks allowed it to pay down a portion of the debt accrued in the Applebee’s deal. DineEquity said the charge reflected “a deterioration in domestic real estate and credit markets” in the past seven months.

Sales, however, jumped 370 percent to $424 million on par with analysts’ expectations.

Same-store sales at IHOP rose 2.6 percent while sales at Applebee’s fell 1.7 percent several Applebee’s promotions did not perform as expected. But the Glendale-based company said it will offer more value beginning in August to help increase traffic.

Shares in DineEquity were off 5 percent to $22.99 in early trading.