Reuters

(Reuters)

Wendy's Sales Lack Sizzle

Industries Reuters

Burger chain Wendy's reported lower-than-expected quarterly comparable sales as diners cut back on eating out.

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The company's shares were down 3.8 percent at $9.80 in premarket trading on Wednesday.

Wendy's quarterly results mirror those of chains such as McDonald's, Dunkin Brands Group and Starbucks, which have reported disappointing same-restaurant sales for the quarter.

Dining out has become an expensive affair compared with eating at home as grocery prices have been falling and restaurants pass on the costs of minimum-wage hikes.

Sales at Wendy's restaurants open for at least 15 months rose 0.4 percent in North America, missing the 1.9 percent rise analysts polled by research firm Consensus Metrix had expected.

Net income fell to $26.5 million, or 10 cents per share, in the second quarter ended July 3 from $40.2 million, or 11 cents per share, a year earlier.

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Total sales fell 22 percent to $382.7 million as the company franchised more outlets, but beat the average analysts' estimate of $367.6 million, according to Thomson Reuters I/B/E/S.

Excluding items, the company earned 10 cents per share, beating the average estimate of 9 cents.

(Reporting by Gayathree Ganesan and Abhijith Ganapavaram in Bengaluru; Editing by Anil D'Silva)