CKE Trims Costs to Boost Profits

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CKE Restaurants Inc. said cutting operating costs enabled the fast food operator to boost net income by 14 percent in its fiscal third quarter, even as sales continued to decline in the uncertain economy. Its stock fell slightly Wednesday since the profit results missed Wall Street forecasts.

The Carpinteria owner and franchiser of the Carl’s Jr. and Hardee’s chains late Tuesday reported net income of $6.2 million (11 cents per share) for the quarter ended November. 2, compared with net income of $5.4 million (10 cents) a year ago.

The company, whose marketing emphasizes its oversized premium hamburgers, said revenue fell 4 percent to $324 million.

Analysts surveyed by Thomson Reuters expected per-share profit of 14 cents on revenue of $324 million.

Same-store sales at company-operated restaurants fell 3.7 percent during the quarter. Separately, the company said that for the four weeks ended November. 30, same-store sales fell 8 percent at Carl’s Jr. and 1.4 percent at Hardee’s for a combined 5 percent decline.

With a new advertising campaign starring reality show star Kim Kardashian, the company hopes to attract more women and other health-conscious customers to Carl’s Jr. with a menu of premium entrée salads and other healthier options.

“The U.S. economic downturn and particularly high unemployment rates in California and among our core target audience of young men, continued to impact same-store sales,” Chief Executive Andrew F. Puzder said in a statement. “Our profitability remained strong as we avoided the competition’s deep-discounting tactics and due to favorable commodity costs.”

Shares closed down 26 cents, or 3 percent, to $8.39 on the New York Stock Exchange.

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