St. Louis / MO. (pbc) Panera Bread Company said its second-quarter profit increased 28 percent in part because of lower wheat costs. The St. Louis-based restaurant chain reported earnings of 20 million USD or 0,65 USD per share, for the three-month period that ended June 30. That includes special charges of 0,02 USD per share for a write-off of smallwares related to the rollout of new china and 0,02 USD per share for reserves associated with a state sales tax audit. During the same period last year, Panera reported earnings of 15,7 million USD or 0,52 USD per share. Revenue increased three percent to 330,8 million USD from 320,9 million USD in the same quarter in 2008. Summary:
- Q2/2009 net income up 28 percent over Q2/2008
- Q2/2009 operating margin up 140 bps over Q2/2008
- Q2/2009 system-wide comparable bakery-cafe sales flat, net of the Easter impact
- Company-owned comparable bakery-cafe sales up 2,8 percent for the first 27 days of Q3/2009
- Q3/2009 EPS target set at 0,55 USD to 0,59 USD (up 22 percent to 31 percent versus Q3/2008)
- FY/2009 EPS target tightened to 2,60 USD to 2,68 USD (up 17 percent to 21 percent versus FY/2008 with one less week)
For the twenty-six weeks ended June 30, 2009, net income was 37 million USD, or 1,21 USD per diluted share. These results compare to net income of 28 million USD or 0,93 USD per diluted share, for the twenty-six weeks ended June 24, 2008, and represents a 33 percent year-over-year increase in net income.
The following tables set forth, for the periods indicated, certain items included in the Company´s consolidated statements of operations (in thousands, except per share data and percentages):
Table 01: Q2/2009 – the 13 Weeks Ended …
| 2009-06-30 | 2008-06-24 | Change | |
| Total revenue | $330’794 | $320’868 | 03 percent |
| Net income | $20’029 | $15’706 | 28 percent |
| Diluted earnings per share | $0,65 | $0,52 | 25 percent |
| Shares used in diluted EPS | 30’959 | 30’338 |
Table 02: H1/2009 – the 26 Weeks Ended …
| 2009-06-30 | 2008-06-24 | Change | |
| Total revenue | $651’503 | $625’847 | 04 percent |
| Net income | $37’461 | $28’146 | 33 percent |
| Diluted earnings per share | $1,21 | $0,93 | 30 percent |
| Shares used in diluted EPS | 30’849 | 30’240 |
Second Quarter Fiscal 2009 Business Review
Comparable Bakery-Cafe Sales Growth: In the second quarter of fiscal 2009, system-wide comparable bakery-cafe sales decreased (0,4) percent versus the comparable period in fiscal 2008 (Company-owned comparable bakery-cafe sales decreased (0,7) percent and franchise-operated comparable bakery-cafes decreased (0,2) percent). These second quarter comparable sales results were impacted negatively by approximately 0,5 percent from the shift of the Easter holiday from the first quarter of fiscal 2008 to the second quarter of fiscal 2009. Thus, excluding the impact of the Easter shift, the Company and its franchisees experienced essentially flat comparable bakery-cafe sales growth for the second quarter of fiscal 2009.
The Company-owned comparable bakery-cafe sales decline of (0,7) percent in the second quarter of fiscal 2009 included the following year-over-year components: transaction decline of (1,4) percent and average check growth of 0,7 percent. Average check growth in turn was comprised of retail price increases of 3,0 percent and negative mix impact of (2,3) percent. Transaction growth was primarily the result of new product introductions, offsetting negative mix impact, which was primarily the result of continued weakness in year-over-year sales in the Company´s high average-check catering business and strong transaction growth in the lower average check breakfast business.
Operating Margin Improvement: In the second quarter of fiscal 2009, the Company generated operating margin improvement of approximately 140 basis points compared to the second quarter of fiscal 2008. This was primarily a result of the year-over-year benefits in wheat costs and the Company´s category management initiatives.
New Unit AWS and Development: In the second quarter of fiscal 2009, average weekly sales (AWS) for Company-owned new units decreased to 35’580 USD compared to 35’776 USD in the second quarter of fiscal 2008. AWS for Company-owned new units year-to-date through the second quarter of fiscal 2009 was 37’314 USD compared to 36’640 USD in the same period of fiscal 2008.
During the second quarter of fiscal 2009, the Company and its franchisees opened 14 new bakery-cafes system-wide, resulting in 1’345 bakery-cafes open system-wide as of June 30, 2009. The breakdown of Company-owned and franchise-operated bakery-cafes are as follows:
| Company-owned | Franchise-operated | Total System | |
| Bakery-cafes as of March 31, 2009 | 564 | 771 | 1’335 |
| Bakery-cafes opened | 4 | 10 | 14 |
| Bakery-cafes closed | (2) | (2) | (4) |
| Bakery-cafes as of June 30, 2009 | 566 | 779 | 1’345 |
