INDIANAPOLIS-The 72-year-old Steak ‘N Shake restaurant company posted disappointing same store sales and slightly lower earnings for the latest fiscal quarter, company officials said in an earnings report Wednesday. The chain vows to improve the same store results at the same time as it continues an expansion program discussed last year.

For the first quarter of fiscal 2007 that ended Dec. 20, same store declined 1.7%, improving from a decline of 3.4% in the fourth quarter of fiscal 2006 but still came out “disappointing,” Peter Dunn, the company’s president and chief executive officer, said. Dunn and other Steak ‘N Shake officials discussed the results with financial analysts Wednesday during the company’s quarterly conference call.

In addition to sluggish same store sales, the 483-restaurant chain reported that net earnings declined to $4.2 million, or 15 cents per diluted share, compared with $4.7 million and 17 cents per share last year. That was on revenues that rose 6.1% to $147.3 million.

Dunn focused a significant portion of his discussion on the same store sales issue, saying that improving those results is one of the company’s highest priorities this year. On the other hand, Dunn said, although same store sales remained negative during the quarter, the company was “encouraged by the improvement since the fourth quarter of fiscal 2006,” when the same store comparison was negative.

The company opened six new restaurants during the first quarter and anticipates opening approximately 15 corporate-owned restaurants and at least seven franchise units in fiscal 2007. Those plans follow a fiscal year 2006 in which Steak ‘N Shake opened 26 new company-owned units and six new franchise units as part of a stated strategy of accelerating the chain’s growth into both new and existing trade areas.

It opened the new company-owned units primarily in existing markets, with the franchise openings in both new and existing markets, and has had growth in current markets and new markets as well. Also this past year, the company implemented a new system designed to refine its site selection process by analyzing each prospective site according to local market demographics, site visibility and accessibility, highway interchanges and proximity to significant generators of potential guests, such as major retailers, housing communities and businesses.

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