Panera Bread Company (PNRA, Financial) filed Quarterly Report for the period ended 2009-03-31.
Panera Bread Company operates a retail bakery-cafe business and franchising business under the concept names Panera Bread Company and Saint Louis Bread Company. The concept specializes in high quality food for breakfast and lunch including fresh baked goods made-to-order sandwiches on freshly baked breads soups salads custom roasted coffees as well as other cafe beverages and targets suburban dwellers and workers by offering a premium specialty bakery and cafe experience with a neighborhood experience.> Panera Bread Company has a market cap of $1.64 billion; its shares were traded at around $52.92 with a P/E ratio of 21.5 and P/S ratio of 1.3. Panera Bread Company had an annual average earning growth of 20% over the past 5 years.
For the thirteen weeks ended March 25, 2008, we earned $0.41 per diluted share with the following performance on key metrics: system-wide comparable bakery-cafe sales growth of 2.3 percent (3.3 percent for Company-owned bakery-cafes and 1.7 percent for franchise-operated bakery-cafes); system-wide average weekly sales increased 0.3 percent to $38,464 ($37,331 for Company-owned bakery-cafes and $39,330 for franchise-operated bakery-cafes); 27 new bakery-cafes opened system-wide, including 14 Company-owned and 13 franchise-operated, and five bakery-cafes closed system-wide in the first quarter of fiscal 2008, including three Company-owned bakery-cafes and two franchise-operated bakery-cafes. In addition, in the first quarter of fiscal 2008, we adjusted our 2008 development plans and made a determination to raise our sales hurdles for new bakery-cafe development. As a result of this determination, we recorded a charge of $2.7 million, or $0.06 per diluted share, to general and administrative expenses related to severance, the write-off of capitalized assets and overhead costs and the termination of leases for specific sites that we decided to no longer develop. Our results for the thirteen weeks ended March 25, 2008 also reflect the pressures we experienced from the significant increase in wheat prices year-over-year as is further discussed below under Results of Operations Costs and Expenses.
Bakery-cafe sales for the thirteen weeks ended March 31, 2009 increased 4.8 percent to $272.9 million compared to $260.4 million for the thirteen weeks ended March 25, 2008. The increase in bakery-cafe sales for the thirteen weeks ended March 31, 2009 compared to the same period in 2008 was primarily due to the opening of 25 new Company-owned bakery-cafes since March 25, 2008 and, to a lesser extent, the 0.3 percent increase in comparable Company-owned bakery-cafe sales for the thirteen weeks ended March 31, 2009. This 0.3 percent increase in comparable bakery-cafe sales was driven by approximately 1.6 percent of transaction decline and 1.9 percent average check growth. Average check growth in turn was comprised of retail price increases of 4.0 percent and negative mix impact of 2.1 percent in comparison to the same period in the prior year. In total, Company-owned bakery-cafe sales as a percentage of total revenue decreased by 0.3 percentage points to 85.1 percent for the thirteen weeks ended March 31, 2009 as compared to 85.4 percent for the same period in 2008. Bakery-cafes included in comparable sales increases and not included in comparable sales increases consisted of 4.4 percent and 95.6 percent, respectively, of the $12.4 million increase in sales from the comparable period in 2008. In addition, the increase in average weekly sales for Company-owned bakery-cafes for the thirteen weeks ended March 31, 2009 was primarily a result of our 2008
The cost of food and paper products was $81.0 million, or 29.7 percent of bakery-cafe sales for the thirteen weeks ended March 31, 2009 compared to $79.3 million, or 30.5 percent of bakery-cafe sales for the comparable period in 2008. This decrease in the cost of food and paper products as a percentage of bakery-cafe sales was principally due to decreases in certain commodity costs including primarily for wheat and fuel; category management initiatives such as product mix management and pricing strategy; sales price increases; and improved leverage of our fresh dough manufacturing costs due to additional bakery-cafe openings. For the thirteen weeks ended March 31, 2009, our previously locked in average all-in cost of wheat was approximately $10.60 per bushel versus $12.84 per bushel in the same period in 2008. For the thirteen weeks ended March 31, 2009, our average cost of fuel was $2.24 per gallon compared to an average of $3.67 per gallon for the same period in 2008. For the thirteen weeks ended March 31, 2009, there was an average of 61.5 bakery-cafes per fresh dough facility, compared to an average of 60.5 for the same period in 2008. Partially offsetting these decreases was deleverage from lower comparable bakery-cafe sales.
Cash and cash equivalents were $114.6 million at March 31, 2009, compared with $74.7 million at December 30, 2008. This increase was primarily a result of the $42.3 million of cash generated from operations, $3.7 million received from the exercise of employee stock options, and $1.5 million received in investment maturity proceeds, partially offset by the $8.1 million used on capital expenditures during the thirteen weeks ended March 31, 2009. Our primary source of liquidity is cash provided by operations, although we have also borrowed under a credit facility principally to finance repurchases of our common stock. Historically, our principal requirements for cash have primarily resulted from our capital expenditures for the development of new Company-owned bakery-cafes, for maintaining or remodeling existing Company-owned bakery-cafes, for purchasing existing franchise-operated bakery-cafes or ownership interests in other restaurant or bakery-cafe concepts, for developing, maintaining or remodeling fresh dough facilities, and for other capital needs such as enhancements to information systems and other infrastructure.
We had working capital of $56.2 million at March 31, 2009 compared to $24.4 million at December 30, 2008. The increase in working capital from December 30, 2008 to March 31, 2009 resulted primarily from the previously described increase in cash and cash equivalents of $39.9 million and an increase in trade accounts receivable, net of $2.4 million, partially offset by an increase in accrued expenses of $4.3 million, a decrease in other accounts receivable of $2.5 million, and an increase in accounts payable of $1.5 million. We believe that our cash flow from operations and available borrowings under our existing credit facility will be sufficient to fund our cash requirements for the foreseeable future.
Read the The complete ReportPNRA is in the portfolios of John Hussman of Hussman Economtrics Advisors, Inc., John Hussman of Hussman Economtrics Advisors, Inc., Ron Baron of Baron Funds.
Panera Bread Company operates a retail bakery-cafe business and franchising business under the concept names Panera Bread Company and Saint Louis Bread Company. The concept specializes in high quality food for breakfast and lunch including fresh baked goods made-to-order sandwiches on freshly baked breads soups salads custom roasted coffees as well as other cafe beverages and targets suburban dwellers and workers by offering a premium specialty bakery and cafe experience with a neighborhood experience.> Panera Bread Company has a market cap of $1.64 billion; its shares were traded at around $52.92 with a P/E ratio of 21.5 and P/S ratio of 1.3. Panera Bread Company had an annual average earning growth of 20% over the past 5 years.
Highlight of Business Operations:
For the thirteen weeks ended March 31, 2009, we earned $0.57 per diluted share with the following performance on key metrics: system-wide comparable bakery-cafe sales growth of 0.7 percent (0.3 percent for Company-owned bakery-cafes and 1.0 percent for franchise-operated bakery-cafes); system-wide average weekly sales decreased 0.1 percent to $38,423 ($37,380 for Company-owned bakery-cafes and $39,190 for franchise-operated bakery-cafes); 14 new bakery-cafes opened system-wide, including four Company-owned bakery-cafes and ten franchise-operated bakery-cafes; and four bakery-cafes closed system-wide, including two Company-owned bakery-cafes and two franchise-operated bakery-cafes.For the thirteen weeks ended March 25, 2008, we earned $0.41 per diluted share with the following performance on key metrics: system-wide comparable bakery-cafe sales growth of 2.3 percent (3.3 percent for Company-owned bakery-cafes and 1.7 percent for franchise-operated bakery-cafes); system-wide average weekly sales increased 0.3 percent to $38,464 ($37,331 for Company-owned bakery-cafes and $39,330 for franchise-operated bakery-cafes); 27 new bakery-cafes opened system-wide, including 14 Company-owned and 13 franchise-operated, and five bakery-cafes closed system-wide in the first quarter of fiscal 2008, including three Company-owned bakery-cafes and two franchise-operated bakery-cafes. In addition, in the first quarter of fiscal 2008, we adjusted our 2008 development plans and made a determination to raise our sales hurdles for new bakery-cafe development. As a result of this determination, we recorded a charge of $2.7 million, or $0.06 per diluted share, to general and administrative expenses related to severance, the write-off of capitalized assets and overhead costs and the termination of leases for specific sites that we decided to no longer develop. Our results for the thirteen weeks ended March 25, 2008 also reflect the pressures we experienced from the significant increase in wheat prices year-over-year as is further discussed below under Results of Operations Costs and Expenses.
Bakery-cafe sales for the thirteen weeks ended March 31, 2009 increased 4.8 percent to $272.9 million compared to $260.4 million for the thirteen weeks ended March 25, 2008. The increase in bakery-cafe sales for the thirteen weeks ended March 31, 2009 compared to the same period in 2008 was primarily due to the opening of 25 new Company-owned bakery-cafes since March 25, 2008 and, to a lesser extent, the 0.3 percent increase in comparable Company-owned bakery-cafe sales for the thirteen weeks ended March 31, 2009. This 0.3 percent increase in comparable bakery-cafe sales was driven by approximately 1.6 percent of transaction decline and 1.9 percent average check growth. Average check growth in turn was comprised of retail price increases of 4.0 percent and negative mix impact of 2.1 percent in comparison to the same period in the prior year. In total, Company-owned bakery-cafe sales as a percentage of total revenue decreased by 0.3 percentage points to 85.1 percent for the thirteen weeks ended March 31, 2009 as compared to 85.4 percent for the same period in 2008. Bakery-cafes included in comparable sales increases and not included in comparable sales increases consisted of 4.4 percent and 95.6 percent, respectively, of the $12.4 million increase in sales from the comparable period in 2008. In addition, the increase in average weekly sales for Company-owned bakery-cafes for the thirteen weeks ended March 31, 2009 was primarily a result of our 2008
The cost of food and paper products was $81.0 million, or 29.7 percent of bakery-cafe sales for the thirteen weeks ended March 31, 2009 compared to $79.3 million, or 30.5 percent of bakery-cafe sales for the comparable period in 2008. This decrease in the cost of food and paper products as a percentage of bakery-cafe sales was principally due to decreases in certain commodity costs including primarily for wheat and fuel; category management initiatives such as product mix management and pricing strategy; sales price increases; and improved leverage of our fresh dough manufacturing costs due to additional bakery-cafe openings. For the thirteen weeks ended March 31, 2009, our previously locked in average all-in cost of wheat was approximately $10.60 per bushel versus $12.84 per bushel in the same period in 2008. For the thirteen weeks ended March 31, 2009, our average cost of fuel was $2.24 per gallon compared to an average of $3.67 per gallon for the same period in 2008. For the thirteen weeks ended March 31, 2009, there was an average of 61.5 bakery-cafes per fresh dough facility, compared to an average of 60.5 for the same period in 2008. Partially offsetting these decreases was deleverage from lower comparable bakery-cafe sales.
Cash and cash equivalents were $114.6 million at March 31, 2009, compared with $74.7 million at December 30, 2008. This increase was primarily a result of the $42.3 million of cash generated from operations, $3.7 million received from the exercise of employee stock options, and $1.5 million received in investment maturity proceeds, partially offset by the $8.1 million used on capital expenditures during the thirteen weeks ended March 31, 2009. Our primary source of liquidity is cash provided by operations, although we have also borrowed under a credit facility principally to finance repurchases of our common stock. Historically, our principal requirements for cash have primarily resulted from our capital expenditures for the development of new Company-owned bakery-cafes, for maintaining or remodeling existing Company-owned bakery-cafes, for purchasing existing franchise-operated bakery-cafes or ownership interests in other restaurant or bakery-cafe concepts, for developing, maintaining or remodeling fresh dough facilities, and for other capital needs such as enhancements to information systems and other infrastructure.
We had working capital of $56.2 million at March 31, 2009 compared to $24.4 million at December 30, 2008. The increase in working capital from December 30, 2008 to March 31, 2009 resulted primarily from the previously described increase in cash and cash equivalents of $39.9 million and an increase in trade accounts receivable, net of $2.4 million, partially offset by an increase in accrued expenses of $4.3 million, a decrease in other accounts receivable of $2.5 million, and an increase in accounts payable of $1.5 million. We believe that our cash flow from operations and available borrowings under our existing credit facility will be sufficient to fund our cash requirements for the foreseeable future.
Read the The complete ReportPNRA is in the portfolios of John Hussman of Hussman Economtrics Advisors, Inc., John Hussman of Hussman Economtrics Advisors, Inc., Ron Baron of Baron Funds.
