(RTTNews) - Quick-service restaurants chain CKE Restaurants, Inc. (CKR: News ), Wednesday, posted a 3.3% decline in "period nine" blended same-store sales, as the further weakening of California's economy continued to impact Carl's Jr. brand.

The Carpinteria, California-based restaurant chain said for fiscal 2010 period nine ended October 5, company-operated blended same-store sales declined 3.3%, with Carl's Jr declining 5.5% and Hardee's decreasing 0.6%. For the same period last year, company-operated blended same-store sales increased 1.2%, with Carl's Jr. rising 1.6% and Hardee's climbing 0.8%.

Chief Executive Andrew Puzder said, "In particular, record levels of California's unemployment exceeding 12%, and 18% for the broader unofficial statistic, have negatively influenced consumers' buying habits. No doubt, this situation is also driving the increase in aggressive 99-cent discount promotions by our competitors."

"Although sales of The Big CarlTM and The Big HardeeTM have been strong, they have not yet offset the loss of ala carte side dishes, drinks and combo sales," he added.

For period nine, total consolidated revenue from company-operated restaurants, exclusive of all franchise-related revenue and royalties, was lower at $82.3 million compared with $84.4 million for the same period in fiscal 2009.

Total consolidated revenue for Carl's Jr. was $45.3 million compared with $46.4 million, while Hardee's revenue was $37.0 million compared with $38.0 million last year.
For period nine, trailing-13 period average unit volume from company-operated restaurants totaled $1.23 million compared with $1.22 million last year: Carl's Jr. was $1.48 million compared with $1.53 million and Hardee's was $1.01 million compared with $978 thousand for fiscal 2009.

Year-to-date, company-operated blended same-store sales decreased 3.1%, with Carl's Jr. and Hardee's sales falling 5.3% and 0.1%, respectively. For the same period last year, the blended same-store sales were up 2.2%, with Carl's Jr. and Hardee's sales up 3.2% and 1.0%, respectively.

Year-to-date consolidated revenue was $766.6 million compared with $795.5 million for the year-ago period.

Looking ahead, the company said it would remain focused on the big, premium burgers while limiting discounting, both of which have the added benefit of protecting profit margins.

Tuesday, CKR closed regular trading session at $10.44 on the NYSE, down 21 cents or 1.97%.

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by RTT Staff Writer

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