Panera profit climbs 27% in third quarter
by Eric Schroeder
ST. LOUIS — Net income at Panera Bread Co. increased 27% in the third quarter behind strong comparable same-store sales growth. Net income in the quarter ended Sept. 25 was $36,515,000, equal to $1.25 per share on the common stock, up from $28,848,000, or 98c per share, in the same period a year ago. Total revenue during the third quarter totaled $529,338,000, up 17% from $453,087,000.
Sales from company-owned stores open at least a year rose 6.2% during the third quarter, while sales for franchise-operated bakery-cafes rose 5.5%.
Panera said it generated operating margin improvement of about 80 basis points during the third quarter, driven by improved bakery-cafe margins, partially offset by lower margins from fresh dough and other product sales to franchisees.
“The increase in bakery-café margins was driven primarily by sales leverage, while the decline in margins from fresh dough and other product sales to franchisees resulted primarily from year-over-year wheat price inflation and higher year-over-year zero margin product sales to franchisees,” Panera said.
For the first nine months of fiscal 2012, net income rose 25% to $121,836,000, or $4.17 per share, from $97,332,000, or $3.27 per share, in the first nine months of fiscal 2011. Total revenues increased 18% to $1,558,508,000 from $1,326,267,000.
The company raised its forecast earnings for the fourth quarter of fiscal 2012 to $1.72 to $1.74 per share, up from $1.66 to $1.70 per share.
Panera also said it expects to earn $5.86 to $5.88 per share for its full fiscal year, up from an earlier forecast of $5.72 to $5.78 per share. Looking ahead to fiscal 2013, Panera placed its initial target for e.p.s. at $6.85 to $7.
“Building on our long-term strategy to drive competitive advantage, we are going to step up our level of investment to provide greater access for our customers, increase our operational capabilities, and improve our core enterprise systems in 2013,” said Ron Shaich, chairman and co-chief executive officer. “We believe these initiatives, along with many other initiatives that are under way, will position Panera for even greater success well into the future.”