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UPDATE 3-Wendy's profit misses, shares fall

(Recasts; adds details on results, analyst comment, byline; updates share fall; changes dateline)

LOS ANGELES/NEW YORK, Feb 4 (Reuters) - Hamburger chain Wendy's International Inc WEN.N, which is considering putting itself up for sale, posted lower-then-expected quarterly profit on Monday, sending its shares down 4 percent.

Wendy’s declined to issue an update on whether it will go on the auction block and said it would not issue financial forecasts for 2008.

Restaurant operators are wrestling with slower consumer spending at the same time they are trying protect profits from the pressures of high food, labor and energy costs.

Last week, industry leader McDonald's Corp MCD.N said sales at its U.S. restaurants open at least 13 months hit the lowest monthly level in nearly five years in December. The company cited bad weather, among other factors, but analysts worried that customers were reeling in spending at fast-food restaurants.

“It’s a perfect storm reflecting a very tough environment. It’s very difficult to operate,” said Telsey Advisory Group analyst Mitch Speiser.

Wendy’s said it plans to raise prices to help offset higher costs, a move that Speiser said could exacerbate already weak sales.

“They’re caught between a rock and a hard place,” the analyst said.

Fourth-quarter net profit at Dublin, Ohio-based Wendy’s was $14.1 million, or 16 cents per share, up from $3 million, or 3 cents per share, a year earlier.

Excluding restructuring and other charges, it earned 21 cents a share, 2 cents short of the average Wall Street forecast, according to Reuters Estimates.

Sales fell 0.1 percent to $596 million.

The company saved nearly $20 million as it held down general, administrative and operating expenses. It also benefited from a lower-than-expected tax rate.

Late last month, Wendy’s said the committee examining its options, including a possible sale or recapitalization, was in the final stages of its review.

The review has taken longer than expected “primarily due to the continuing turmoil in the financial markets,” the company said.

Analysts are concerned that the process has distracted management.

Billionaire Nelson Peltz's Triarc Cos Inc TRY.N, which owns the Arby's fast-food chain, has made a bid for Wendy's, but weak credit markets have cast doubt on whether banks would back any offer.

Wendy’s reported last month that fourth-quarter same-store sales rose 0.2 percent at its U.S. franchise restaurants and fell 0.8 percent at company-owned outlets. Both figures were worse than a year earlier.

Wendy’s began the new year with its 99-cent Stack Attack double cheeseburger to compete with McDonald’s $1 double cheeseburger.

The company, which is trying to revive same-store sales and profit growth, said it would focus on restaurant operations and advertising as part of that effort. On Monday, the company was launching a new ad campaign.

Wendy's shares were down $1.07 to $24.11 in midday trade on the New York Stock Exchange. The shares have lost nearly a quarter of their value in the last 12 months, compared with rises of 22 percent and 31 percent for McDonald's and Burger King Holdings Inc BKC.N, respectively. (Additional reporting by Justin Grant in New York; editing by John Wallace)

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