CKE Blames Loss on Expenses, Slow Sales

CKE Restaurants Inc., owner of the Carl’s Jr. and Hardee’s hamburger chains, said it had a fiscal fourth-quarter loss because expenses rose and Hardee’s sales slowed. The loss from operations was $12.5 million, or 25 cents a share, compared with profit from operations of $13 million, or 25 cents, a year earlier. Revenue for the period ended Jan. 31 rose 10% to $475.5 million from $431.4 million. Anaheim-based CKE has been hurt by slow sales at its burger chains and costs to remodel Hardee’s restaurants into Carl’s Jr. outlets. The company’s shares have lost about two-thirds of their value in the past year. CKE was expected to earn 5 cents, the average estimate of five analysts polled by First Call/Thomson Financial. The company said it took charges totaling $99.8 million pretax, including $42 million to establish a reserve for costs of closing Hardee’s restaurants and $37.3 million to write down the value of investments in other restaurant concepts. CKE operates 3,800 restaurants including 2,788 Hardee’s, 934 Carl’s Jr. and 122 Taco Bueno outlets. CKE’s shares fell 94 cents to close at $5.19 on the NYSE.