On Dec. 12, fast-food restaurant operator CKE Restaurants (NYSE:CKR) released its third-quarter earnings for the period ended Nov. 6.

  • Sales were up 6% overall. At company-owned Carl's Jr. and Hardee's restaurants, same-store sales were up 6.2% and 5.6%, respectively.
  • Operating margins were up for the quarter, but net margins fell because the tax man came a-calling.
  • Forty of 43 investors think CKE Restaurants will outperform the S&P 500. With its continued good performance, could they be right? Let us know your take by signing up to be a part of Motley Fool CAPS, our new community-intelligence service.

(Figures in millions, except per-share data)

Income Statement Highlights

Q3 2006

Q3 2005

Change

Sales

$364.9

$344.1

6.0%

Net Profit

$9.5

$15.8

(39.9%)

EPS

$0.13

$0.23

(43.5%)

Diluted Shares

72.0

73.0

(1.4%)



Get back to basics with a look at the income statement.

Margin Checkup

Q3 2006

Q3 2005

Change*

Gross Margin

76.9%

76.7%

0.3

Operating Margin

6.7%

6.1%

0.6

Net Margin

2.6%

4.6%

(2.0)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q3 2006

Q3 2005

Change

Cash + ST Invest.

$25.6

$20.2

26.7%

Accounts Rec.*

$40.7

$39.2

3.8%

Inventory

$20.9

$19.5

7.2%



Liabilities

Q3 2006

Q3 2005

Change

Accounts Payable

$58.1

$52.4

10.9%

Long-Term Debt**

$127.6

$265.1

(51.9%)

*Includes related-party receivables.
**Long-term debt, convertible notes, and capital lease obligations.

Learn the ways of the balance sheet.

Cash Flow Highlights

YTD 2006

YTD 2005

Change

Cash From Ops.

$134.9

$99.1

36.1%

Capital Expenditures*

$65.7

$48.3

36.0%

Free Cash Flow

$69.2

$50.8

36.2%

*Capital expenditures minus the proceeds from the sale of property and equipment.

Find out why Fools always follow the money.

Related Companies:

  • McDonald's (NYSE:MCD)
  • Burger King (NYSE:BKC)
  • Sonic (NASDAQ:SONC)

Related Foolishness:

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so checkFool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, David Meier did not own shares in any of the companies mentioned. Fool rules for disclosure are here.