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NRA survey reveals record-low capital spending in Nov.

WASHINGTON Capital expenditures stood at a record low in November as weak sales and pessimistic attitudes about the economy kept operators from spending on their operations, according to the National Restaurant Association.

Just 39 percent of operators surveyed monthly by the NRA said that they had either purchased equipment or spent on remodeling or expansion since September, a new record low for the survey. Operators also said they remain hesitant to plan for future spending because of doubts related to any economic recovery. A still-frozen credit market and projections for weak consumer spending through 2009 have kept many operators unable to invest in operations. The NRA’s report, released Wednesday, revealed that 40 percent of operators plan to make a large capital expenditure during the next six months, a result that was up slightly from the record low of 37 percent in October.

November marked another tough month for the restaurant industry, as 60 percent of NRA respondents said they posted negative same-store sales and traffic levels. Looking forward, 48 percent said they expect their sales in six months to be lower than in the same six months a year ago. According to the NRA, restaurant operators are not confident that macroeconomic trends will improve. Only 17 percent of operators said they expect economic conditions to get better in six months, while 49 percent said they expect economic conditions to worsen in six months.

The NRA’s November Restaurant Performance Index stood at 96.7, down 0.4 percent from October and matching the record low set in September. The NRA Index is pegged to 100, which means results above 100 indicate that the industry is expanding, and results below 100 mean the industry is contracting. November marked the 13th consecutive month of index results below 100.

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