Steak N Shake Posts Surprising 2Q Profit

INDIANAPOLIS (AP) — Restaurant company Steak n Shake Co. on Friday posted a profit in its fiscal second quarter, beating Wall Street's expectations for a loss due to cost cuts and a rise in sales at established locations.

For the quarter ended April 8, the company reported net income of $2.3 million, or 8 cents per share. Analysts polled by Thomson Reuters, on average, expected a loss of 10 cents per share.

The Indianapolis company's costs dropped 5 percent, contributing to the beat.

In the first quarter of 2008, Steak n Shake lost $2.8 million, or 10 cents per share.

Revenue, meanwhile, fell less than 1 percent to $189 million from $190.5 million, as the company operated fewer company-owned restaurants.

Same-store sales, or sales at locations open at least a year, rose 2.4 percent.

The company said its guest traffic jumped nearly 8 percent even as the guest check — the average amount customers pay at the chain for a full meal — fell by 5.4 percent.

Shares of Steak n Shake, a chain of 489 restaurants, closed Thursday at $9.21. The stock had not opened in pre-market trading Friday.