Panera Bread 2005 Annual Report Download - page 26

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20
Fiscal Year 2005 Compared to Fiscal Year 2004
Results of Operations
Revenues
Our total revenues for the fiscal year ended December 27, 2005 increased 33.6% to $640.3 million compared to $479.1 million for
the fiscal year ended December 25, 2004. The growth in total revenues for the fiscal year ended December 27, 2005, as compared to
the prior year, was primarily due to the opening of 139 new bakery-cafes in 2005 as well as increases in system-wide comparable
bakery-cafe sales of 7.8% for the fiscal year ended December 27, 2005. The system-wide average weekly sales per bakery-cafe and
the related number of operating weeks for the fiscal year ended December 27, 2005 and December 25, 2004 were as follows:
For the Fiscal Year Ended
December 27,
2005
December 25,
2004
Percentage
Increase
System-wide average weekly sales.......................................................................................... $ 38,318 $ 36,008 6.4%
System-wide number of operating weeks ................................................................................ 41,370 34,470 20.0%
Average weekly sales is calculated by dividing total net sales by operating weeks. Accordingly, year over year growth reflects
sales for all locations, whereas comparable store sales exclude closed locations and are based on sales for bakery-cafes that have been
in operation and owned for at least 18 months.
New stores typically experience an opening “honey-moon” whereby they generate higher average weekly sales during the first 12
to 16 weeks they are open as customers “settle-in” to normal usage patterns from initial trial of the location. On average the “settle-in”
experienced is 5% to 10% from the average weekly sales during the “honey-moon” period. As a result, year over year growth in
average weekly sales is generally lower than the growth in comparable bakery-cafe sales. This results from the relationship of the
number of bakery- cafes in the “honey-moon” phase, the number of bakery-cafes in the “settle-in” phase, and the number of stores in
the comparable store base.
As described above, we had an additional three days in the first quarter of 2005 as compared to the first quarter of 2004 as a result
of changing our fiscal week in 2005 to end on Tuesday rather than Saturday. Average weekly sales and comparable bakery-cafe sales
exclude these three additional days in the first quarter of 2005 for comparative purposes.
Bakery-cafe sales for the fiscal year ended December 27, 2005 for the Company-owned bakery-cafes increased 37.9% to $499.4
million from $362.1 million for the fiscal year ended December 25, 2004. Company-owned bakery-cafe sales as a percentage of total
revenue increased by 2.4 percentage points for the fiscal year ended December 27, 2005 compared to the fiscal year ended December
25, 2004, and fresh dough sales to franchisees as a percentage of total revenue decreased by 1.6 percentage points for the fiscal year
ended December 27, 2005 compared to the fiscal year ended December 25, 2004, primarily as a result of the increase in the number of
Company-owned bakery-cafe openings. The increase in bakery-cafe sales was primarily due to the impact of a full year’s operations
of the 54 Company-owned bakery-cafes opened in 2004, the opening of 66 Company-owned bakery-cafes in 2005, and the 7.4%
increase in comparable bakery-cafe sales for the fiscal year ended December 27, 2005. Bakery-cafes included in comparable sales
increases and not included in comparable sales increases contributed 17% and 83%, respectively, of the $137.3 million increase in
sales from 2004. The average weekly sales per Company-owned bakery-cafe and the related number of operating weeks for the fiscal
years ended December 27, 2005 and December 25, 2004 were as follows:
For the Fiscal Year Ended
December 27,
2005
December 25,
2004
Percentage
Increase
Company-owned average weekly sales ................................................................................... $ 37,348 $ 35,620 4.9%
Company-owned number of operating weeks ......................................................................... 13,280 10,166 30.6%
Franchise royalties and fees rose 22.3% to $54.3 million for the fiscal year ended December 27, 2005 from $44.4 million for the
fiscal year ended December 25, 2004. The components of franchise royalties and fees were as follows (in thousands):
For the Fiscal Year Ended
December 27,
2005
December 25,
2004
Franchise royalties ....................................................................................................................................... $ 51,539 $ 41,199
Franchise fees .............................................................................................................................................. 2,770 3,250
Total ........................................................................................................................................................... $ 54,309 $ 44,449