News

Panera's Q2 earnings fall short

July 24, 2013

Although Panera Bread's Q2 net income for the second quarter this year ($51 million at $1.74 per share) was about $7 million higher than this time last year, it still fell short of Thomson Reuters expectations, which predicted the company to earn $1.77 per share.

After the Tuesday earning's announcement, shares were down 5.3 percent at $172.40.

Total revenue for the second quarter rose 11 percent to $589.01 million from $530.59 million a year ago, according to the company, which forecasted earnings of $1.32 to $1.36 per share for the third quarter and $2.05 to $2.11 per share for the fourth quarter.

Highlights included:

• Company-owned comparable net bakery-cafe sales up 3.8 percent.
• YTD 2013 System-wide new bakery-cafe AWS of $50,338, above YTD 2012 record pace of $47,581, and
• FY 2013 new bakery-cafe openings expected to be at or above the high-end of target range of 115 to 125.

The company, however, lowered its earnings forecast for the full year to $6.75-$6.85 per share compared to its previous estimates of $6.89-$7.01 per share, based on earnings of $5.89 reported for fiscal 2012.

"In the second quarter of 2013, we delivered within the range of our diluted EPS guidance. Our two-year comparable same-store sales growth for the quarter was strong at 10.9 percent and our new unit sales remain on track for another record year, reaffirming how strongly our brand resonates with consumers," said Ron Shaich, chairman and co-CEO. "However, our one-year comparable same-store sales growth of 3.8 percent was below our expectations. We now believe that to consistently operate at the very high sales volumes we are generating and to prepare for additional sales from our initiatives to expand access to Panera and utilize national marketing, we must improve our peak hour throughput.

"While results in the next few quarters may be choppy as we invest in both sales-building initiatives and operational capabilities, we believe that our efforts will ultimately enable us to deliver an enhanced customer experience, grow sales and expand earnings."

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