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Wendy's profit rises as restaurant renovations, new menu items drive sales

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DUBLIN, Ohio — Wendy's reported a higher quarterly profit Thursday as restaurant renovations and new menu items helped drive sales.

The company famous for its square hamburger patties has been pushing to give its restaurants a more contemporary, inviting look in line with newer places such as Panera Bread. It has also been rolling out new items like a chicken sandwich on ciabatta bread to help position itself as a more premium fast-food outlet.

For the quarter, Wendy's said sales at established company-owned restaurants rose 3.9 percent, while the figure rose 3.1 percent at franchised locations. The company said its company-owned locations performed better because more of them have been renovated to have its new look.

The effort to position Wendy's as a purveyor of higher-quality food comes as traditional fast-food chains have been struggling to boost sales, with many Americans looking to stick to diets they feel are healthier. In the latest quarter, McDonald's reported a 1.5 percent decline in the U.S. while Burger King reported a 0.4 percent increase in U.S. and Canada.

Wendy's said it earned $29 million, or 8 cents per share, for the period. That's more than double the $12.2 million, or 3 cents per share, in the same quarter a year ago. The year-ago results included a $21 million pretax charge for the repayment of debt.

Earnings, adjusted for non-recurring costs, were 9 cents per share, in line with expectations, according to Zacks Investment Research.

Revenue declined 20 percent to $523.4 million, reflecting the sale of restaurants to franchisees. Analysts expected $516.7 million.

Shares of The Wendy's Co. rose 13 cents, or 1.6 percent, to $8.11 in midday trading. Its shares are down 8.5 percent so far this year through Wednesday's close.

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