Einstein Noah Restaurant Group Inc. has reported financial results for the first quarter ended March 29, 2011.
System-wide comparable store sales decreased 0.8 percent as transactions fell primarily due to the impact of weather-related store closure days partially offset by an increase in average check. Total revenues increased to $101.2 million from $100.8 million.
Gross profit for the quarter was $17.8 million or 17.6 percent of total revenues compared with $18.8 million or 18.7 percent of first quarter 2010 total revenues. The company’s gross profit impact for the quarter was primarily due to higher commodity costs and sales deleveraging, partially offset by the realization of operational efficiencies on labor costs.
The company spent $3.3 million in marketing initiatives to build traffic and drive awareness of its brands during the first quarter of 2011 compared to $2.8 million in 2010. Much of this incremental investment in marketing initiatives came toward the end of the quarter to build momentum moving into the second quarter and the remainder of 2011.
Manufacturing and commissary gross profit improved to $1.4 million from $1.3 million in the first quarter of 2010. This segment’s gross profit percentage declined by 130 basis points as a percentage of revenue to 15.5 percent due to the timing lag of commodity costs relative to price increases to customers.
Adjusted EBITDA was $7.8 million in the first quarter of 2011 compared to $8.7 million in the first quarter of 2010. Income before income taxes increased 11.3 percent to $2.0 million from $1.8 million.
Restaurant openings during the first quarter of 2011 included four Einstein Bros. restaurants, which consisted of one company-owned restaurant, two franchise restaurants, and one license restaurant. In addition, one company-owned restaurant has been relocated.
The company will host a conference call to discuss first quarter 2011 financial results today at 3:00 p.m. Mountain time (5:00 p.m. Eastern time). Hosting the call will be Jeff O’Neill, CEO and president, and Manny Hilario, chief financial officer.
The dial-in numbers for the conference call are 1-877-407-0784 for domestic toll-free calls and 1-201-689-8560 for international. The conference ID is 370634. A telephone replay will be available through May 12, 2011, and may be accessed by dialing 1-877-870-5176 for domestic toll-free calls or 1-858-384-5517 for international. The conference ID is 370634.
