On Sept. 19, Hardee's and Carl's Jr. parent company CKE Restaurants (NYSE:CKR), home of the man-sized Monster Thickburger, released earnings for its fiscal second quarter, which ended Aug. 14.

  • Good cost control during the quarter allowed increased sales to drop all the way down to the bottom line. (In other words, profits increased.)
  • That and nice working capital management combined to produce more cash this quarter than during last year's quarter. Sweet!
  • Convertible-note holders exchanged $51.4 million of notes for shares of common stock, reducing the total amount of debt held on the balance sheet. Shares outstanding increased, but the number of diluted shares was unaffected by these transactions.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

Q2 2007

Q2 2006

Change

Sales

$382.2

$376.0

$359.8

4.5%

Net Profit

--

$14.2

$8.5

68.0%

EPS

$0.19

$0.20

$0.13

53.8%

Diluted Shares

72.8

73.6

(1.1%)



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

Margin Checkup

Q2 2007

Q2 2006

Change*

Gross Margin**

71.52%

70.41%

1.11

Operating Margin

8.86%

3.67%

5.19

Net Margin

3.78%

2.35%

1.43

*Expressed in percentage points.
**Uses sales at company-owned restaurants minus cost of food and packaging.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q2 2007

Q2 2006

Change

Cash + ST Invest.

$22.1

$19.8

11.6%

Accounts Rec.

$40.8

$39.3

3.9%

Inventory

$21.6

$20.2

7.1%



Liabilities

Q2 2007

Q2 2006

Change

Accounts Payable

$59.0

$57.1

3.4%

Long-Term Debt

$133.0

$227.2

(41.5%)



Learn the ways of the balance sheet.

Cash Flow Highlights

Q2 2007

Q2 2006

Change

Cash From Ops.

$97.7

$67.7

44.3%

Capital Expenditures

$56.1

$39.6

41.6%

Free Cash Flow

$41.6

$28.1

48.0%



Find out why Fools always follow the money.

Related Companies:

  • Burger King (NYSE:BKC)
  • McDonald's (NYSE:MCD)
  • Wendy's (NYSE:WEN)
  • Chipotle (NYSE:CMG)
  • YUM! Brands (NYSE:YUM)

Related Foolishness:

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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, Fool contributor David Meier did not own shares in any of the companies mentioned. The Motley Fool has a disclosure policy.