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UPDATE 1-CKE Restaurants same-store sales rise 1.2 percent

Wed Oct 15, 2008 8:45am EDT

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* Same-store sales up 1.6 pct at Carl's Jr.

Stocks  |  Global Markets

* Hardee's same-store sales rise 0.8 pct

* CKE feels pressure from rivals' discounts (Adds details, dateline)

CHICAGO, Oct 15 (Reuters) - CKE Restaurants Inc (CKR.N) posted slightly higher sales for the four weeks ended Oct. 6, as rivals offering deep discounts pressured the company's Carl's Jr. and Hardee's chains.

Sales at established restaurants, or same-store sales, rose 1.2 percent, CKE said on Wednesday. Same-store sales rose 1.6 percent at Carl's Jr. and 0.8 percent at Hardee's.

Larger hamburger chains have been promoting low-cost items, such as McDonald's Corp's (MCD.N) Dollar Menu, to appeal to consumers looking for less-expensive alternatives.

"Deep discounting is a tactic we choose not to employ because it negatively impacts consumer perceptions of food quality as well as profitability for both company-owned restaurants and franchisees," Chief Executive Andrew Puzder said in a statement.

To attract cash-strapped consumers, Hardee's introduced quarter-pound sized Little Thickburgers. The Little Cheese Thickburger has a suggested starting price of $1.99. The chain also introduced the Pork Chop 'N' Gravy Biscuit for breakfast.

CKE said Hardee's suffered in the aftermath of Hurricane Ike, since it was tough for consumers in the U.S. Southeast to get gasoline after refineries closed in the Gulf region.

In a statement, CKE also pointed out a revised website presentation that highlights its balance sheet, its "very favorable" credit agreement that runs through March 2012, and its performance in the tough economic climate. (Reporting by Jessica Wohl; Editing by Lisa Von Ahn)



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