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Panera Bread Company Reports Operating Results (10-Q)

November 05, 2010 | About:
10qk

10qk

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Panera Bread Company (PNRA) filed Quarterly Report for the period ended 2010-09-28.

Panera Bread Company has a market cap of $2.89 billion; its shares were traded at around $92.84 with a P/E ratio of 28.3 and P/S ratio of 2.1. Panera Bread Company had an annual average earning growth of 26.3% over the past 10 years. GuruFocus rated Panera Bread Company the business predictability rank of 4-star.PNRA is in the portfolios of John Hussman of Hussman Economtrics Advisors, Inc., Ron Baron of Baron Funds, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors, Jeremy Grantham of GMO LLC.

Highlight of Business Operations:

For the thirteen weeks ended September 28, 2010, we earned $0.75 per diluted share with the following performance on key metrics: system-wide comparable bakery-cafe sales grew 6.9 percent compared to the thirteen weeks ended September 29, 2009 (growth of 5.5 percent for Company-owned bakery-cafes and growth of 7.9 percent for franchise-operated bakery-cafes); system-wide average weekly sales increased 6.2 percent to $41,813 ($40,487 for Company-owned bakery-cafes and $42,797 for franchise-operated bakery-cafes); and 22 new bakery-cafes opened system-wide (10 Company-owned bakery-cafes and 12 franchise-operated bakery-cafes). Our results for the thirteen weeks ended September 28, 2010 of $0.75 per diluted share included a favorable impact of $0.01 per diluted share from the repurchase of 1,007,984 shares under our $600.0 million share repurchase authorization.

For the thirteen weeks ended September 29, 2009, we earned $0.61 per diluted share with the following performance on key metrics: system-wide comparable bakery-cafe sales grew 2.7 percent compared to the thirteen weeks ended September 23, 2008 (growth of 3.2 percent for Company-owned bakery-cafes and growth of 2.4 percent for franchise-operated bakery-cafes); system-wide average weekly sales increased 1.9 percent to $39,383 ($38,655 for Company-owned bakery-cafes and $39,913 for franchise-operated bakery-cafes); 19 new bakery-cafes opened system-wide (nine Company-owned bakery-cafes and 10 franchise-operated bakery-cafes); and two franchise-operated bakery-cafes closed. Our results for the thirteen weeks ended September 29, 2009 of $0.61 per diluted share included $0.04 per diluted share of net charges primarily to increase reserves for certain state sales tax audit exposures, partially offset by a gain recorded on both, the redemptions received during the quarter on our investment in the Columbia Strategic Cash Portfolio, referred to as the Columbia Portfolio, and the change in the recorded fair value of the units held during the period.

For the thirty-nine weeks ended September 28, 2010, we earned $2.42 per diluted share with the following performance on key metrics: system-wide comparable bakery-cafe sales grew 8.8 percent compared to the thirty-nine weeks ended September 29, 2009 (growth of 8.3 percent for Company-owned bakery-cafes and growth of 9.1 percent for franchise-operated bakery-cafes); system-wide average weekly sales increased 8.1 percent to $42,210 ($41,121 for Company-owned bakery-cafes and $43,016 for franchise-operated bakery-cafes); 43 new bakery-cafes opened system-wide (21 Company-owned bakery-cafes and 22 franchise-operated bakery-cafes); and two bakery-cafes closed system-wide (one Company-owned bakery-cafe and one franchise-operated bakery-cafe). Our results for thirty-nine weeks ended September 28, 2010 of $2.42 per diluted share included a favorable impact of $0.04 per diluted share from the repurchase of 1,905,540 shares under our $600.0 million share repurchase authorization. This favorable impact was offset by the negative impact of $0.05 per diluted share related to an on-going unclaimed property audit.

For the thirty-nine weeks ended September 29, 2009, we earned $1.82 per diluted share with the following performance on key metrics: system-wide comparable bakery-cafe sales grew 0.9 percent compared to the thirty-nine weeks ended September 23, 2008 (growth of 0.7 percent for Company-owned bakery-cafes and growth of 1.0 percent for franchise-operated bakery-cafes); system-wide average weekly sales increased 0.2 percent to $39,033 ($38,178 for Company-owned bakery-cafes and $39,657 for franchise-operated bakery-cafes); 47 new bakery-cafes opened system-wide (17 Company-owned bakery-cafes and 30 franchise-operated bakery-cafes); and 10 bakery-cafes closed system-wide (four Company-owned bakery-cafes and six franchise-operated bakery-cafes). Our results for the thirty-nine weeks ended September 29, 2009 of $1.82 per diluted share included $0.08 per diluted share net charges primarily to increase reserves for certain state sales tax audit exposures and to write-off smallwares related to the rollout of new china, partially offset by a gain recorded on both the redemptions received during the period on our investment in the Columbia Portfolio and the change in the recorded fair value of the units held during the period.

Bakery-cafe sales for the thirteen weeks ended September 28, 2010 increased 10.3 percent to $315.2 million compared to $285.9 million for the thirteen weeks ended September 29, 2009. The increase in bakery-cafe sales for the thirteen weeks ended September 28, 2010 compared to the same period in 2009 was primarily due to the opening of 34 new Company-owned bakery-cafes since September 29, 2009 and to the 5.5 percent increase in Company-owned comparable bakery-cafe sales for the thirteen weeks ended September 28, 2010. This 5.5 percent growth in comparable bakery-cafe sales was driven by approximately 0.2 percent of transaction growth and approximately 5.3 percent average check growth. Average check growth, in turn, was comprised of retail price increases of approximately 2.0 percent and positive mix impact of approximately 3.3 percent in comparison to the same period in the prior year. In total, Company-owned bakery-cafe sales as a percentage of total revenues decreased to 84.7 percent for the thirteen weeks ended September 28, 2010 as compared to 85.3 percent for the same period in 2009. The increase in average weekly sales for Company-owned bakery-cafes for the thirteen weeks ended September 28, 2010 compared to the same period in 2009 was primarily due to an increase in transactions and average check growth. The average weekly sales per Company-owned bakery-cafe and the number of operating weeks for the periods indicated were as follows:

Franchise royalties and fees for the thirty-nine weeks ended September 28, 2010 increased 12.0 percent to $64.0 million compared to $57.2 million for the thirty-nine weeks ended September 29, 2009. The components of franchise royalties and fees for the periods indicated were as follows (in thousands):

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