CKE Restaurants Inc., parent company of Carl’s Jr. and Hardee’s, reported a 12.2 percent decrease in total revenue for the third quarter of fiscal 2011, ended Nov. 1, as compared to Q3 '10.
The company’s revenue was $284.5, a $39.7 million drop from last year. The company attributed the loss to the sale of the Carl’s Jr. distribution business in July, as well as rising interest expenses. The sale also affected the company’s Q2 numbers, which were down 6.6 percent from the previous year.
The numbers may be a bit misleading, however. Excluding the distribution center revenue, total revenue increased 1.5 percent. Companywide, same-store sales inched up 0.9 percent, compared to -3.7 percent from FY 2010.
Hardee’s sales were up 8.3 percent, which is a big turnaround from last year’s results of -1.8 percent. And, although Carl’s Jr. same-store sales declined 5 percent for Q3 '11, it is a slight 0.2 percent improvement from last year.
Year-to-date, blended sales hovered at -1.7 percent, compared to -3.3 percent from FY 2010.
“Hardee’s continued to generate strong same-store sales results. Including the last period of our third quarter, Hardee’s has now had nine consecutive periods of positive same-store sales,” said Andrew F. Puzder, CEO, “Carl’s Jr. same-store sales results have been challenged by difficult economic conditions, especially the high unemployment rate among our core target audience of young men in the state of California, where 86 percent of our company-operated restaurants are located.”
Additional attributes affecting Q3 numbers were increases in food and packaging costs and occupancy costs. However, labor and advertising expenses were down, as were administrative expenses.
Moving forward, Puzder said the company remains focused on maintaining its brands and improving same-store sales with innovative products and cutting-edge advertising.
In July, CKE Restaurants Inc. was acquired by Columbia Lake Acquisition Holdings Inc., an affiliate of Apollo Management VII L.P., for $1 billion.
There are 3,141 CKE restaurants as of Nov. 1; 891 of which are company-operated.
