CKE Profit Falls 13 Percent in Quarter

0

CKE Restaurants Inc. said Wednesday its third-quarter net income fell 13 percent, primarily due to interest expenses unrelated to sales at its Carl’s Jr. and Hardee’s fast food restaurants.

Another factor in the decrease was the franchising over the past year of 118 Hardee’s locations that the company had owned.

The Carpinteria-based operator of the Carl’s Jr. and Hardee’s fast food chains reported earnings after market close. Net income was $5.4 million (10 cents a share) for the quarter ended Nov. 3, compared with net income of $6.2 million (11 cents) a year ago.

Combined same-store sales rose 0.9 percent, although total revenue fell 4 percent to $337 million. This year’s quarter included $4.9 million of interest expense related to the company’s interest rate swap agreements, compared with a $1.8 million expense in the prior year quarter.

Analysts surveyed by FactSet Research expected earnings of 10 cents a share on revenue of $340 million.

“We continue to believe that our brands are well-positioned to endure the current macroeconomic situation,” Chief Executive Andrew Puzder said in a statement. “Going forward, the combination of our premium product strategy, cutting-edge advertising, and remodeled and dual-branded restaurants should allow us to continue growing our average unit volumes as well as maintain, if not improve, our restaurant operating costs.”

Before the announcement, CKE shares closed up 66 cents, or 8 percent, to $8.66 on the New York Stock Exchange.

No posts to display