News

Einstein Noah reports Q1 sales increase of 1.6 percent

May 5, 2014

Einstein Noah Restaurant Group Inc., parent company of Einstein Bros. Bagels, Noah's New York Bagels and Manhattan Bagel brands, last week reported financial results for the first quarter ended April 1.

Highlights include:

• Total revenues increased $3.5 million, or 3.3 percent, to $109.9 million from $106.4 million. System-wide comparable store sales increased 1.6 percent. Company-owned comparable store sales increased 1.7 percent.
• Adjusted EBITDA was $10.1 million compared to $10.4 million in the prior year, reflecting store-level investments.
• Net income was $2.1 million or $0.11 per diluted share compared to net income of $2.4 million or $0.14 per diluted share. Net income in the first quarter 2014 included pre-tax senior management transition costs of $1.1 million or $0.04 per diluted share after-tax.
• 13 system-wide openings compared to 11 system-wide openings in the prior year.

Michael Arthur, interim president and CEO, said in a news release that the quarter marked the company-owned stores' strongest sales gain since Q1 of 2008, despite unfavorable weather.

"Restaurant gross margins were equal or better than prior periods when normalized for one-time events, up front investments, and the timing of expenditures," he said.

The company continues to invest in its corporate store base after a "successful" remodeling initiative in its 12-store Orlando, Fla., market, where it experienced a profitable sales lift on an average expenditure of $115,000 per store remodel.

"We now plan to remodel at least 20 additional stores, and with continued success, we may remodel as many as 75 company-owned stores during 2014 to further enhance our brand image," Arthur said.

Einstein Noah plans to open 75 to 85 new stores this year, including 15 to 20 corporate locations.

$20 million share repurchase program

Einstein Noah Restaurant Group has also authorized a $20 million share repurchase program. The company expects to initiate repurchases promptly for up to $5 million of its common stock in the open market or through privately negotiated transactions.