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Wendy's Swings to Profit After Real Estate Sale

February 04, 2006|From Bloomberg News

Wendy's International Inc. reported a fourth-quarter profit after selling real estate.

Net income was $30 million, or 25 cents a share. A year earlier, Wendy's lost $141.4 million, or $1.25, after the company wrote down the value of its Baja Fresh Mexican Grill chain.

Sales in the quarter declined 0.1% to $977.3 million, Dublin, Ohio-based Wendy's said.

Sales at stores open at least a year, a key measure of retail health, fell 2.9% in the quarter. Comparable sales at rival McDonald's climbed 4.1%.

In addition to increased competition, Wendy's said it was still recovering from a woman's false claim in March that she found a human finger in a bowl of chili at a Wendy's outlet.

Wendy's profit came from a $60.9-million pretax gain from the sale of land under 166 restaurants.

Sales at Wendy's restaurants, including company-owned outlets and franchises, fell 5.4% to $588.9 million in the quarter. Sales at Baja Fresh and other brands dropped 11% to $46.8 million, the company said.

Shares of Wendy's declined 22 cents Friday to $58.17.

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