CKE 1st-Q profit down 5.1% on increased costs; revs up 1.6%

Nation's Restaurant News,  July 2, 2007  

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CARPINTERIA, CALIF. -- CKE Restaurants Inc., parent of the Carl's Jr. and Hardee's quick-service brands, said increased expenses related to compensation and a new food distribution system led to a 5.1-percent drop in its fiscal 2008 first-quarter profit, even as revenue rose 1.6 percent to $481.8 million.

For the quarter ended May 21, CKE's net income fell to $15.4 million from $16.2 million in the year-ago quarter. Per-share earnings in the latest quarter remained unchanged from a year ago at 23 cents, mainly because CKE had fewer shares outstanding in the latest quarter than a year earlier after it bought back nearly 4.4 million shares for $83.3 million.

CKE said quarterly results were hurt by a $1.3 million year-over-year increase in stock-based compensation expenses and $1.3 million in total costs related to the relocation of a Carl's Jr. food distribution center and a new distribution management system.

First-quarter same-store sales were flat at Carl's Jr., CKE reported, but increased 1.8 percent at Hardee's. For the four weeks ended June 18, CKE said same-store sales improved, up 2.8 percent from a year ago at Carl's Jr. and 2.6 percent at Hardee's.

CKE and its franchisees operate 1,101 Carrs Jr. and 1,905 Hardee's restaurants.

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