Panera Bread 2008 Annual Report Download - page 42

our cash flow from operations and available borrowings under our existing credit facility will be sufficient to fund
our cash requirements for the foreseeable future.
A summary of our cash flows, for the periods indicated, is as follows (in thousands):
Cash provided by (used in):
December 30,
2008
December 25,
2007
December 26,
2006
For the Fiscal Year Ended
Operating activities ............................ $156,282 $ 154,014 $104,895
Investing activities ............................. $ (47,663) $(197,262) $ (90,917)
Financing activities ............................ $(102,151) $ 59,393 $ 13,668
Operating Activities
Funds provided by operating activities in fiscal 2008 primarily resulted from net income, adjusted for non-cash
items such as depreciation and amortization, stock-based compensation expense, deferred taxes, and the tax benefit
from exercise of stock options, a decrease in trade and other accounts receivable, an increase in deferred rent, an
increase in other long-term liabilities and non-acquisition accrued expenses, partially offset by an increase in
prepaid expenses. Funds provided by operating activities in fiscal 2007 primarily resulted from net income, adjusted
for non-cash items such as depreciation and amortization, a decrease in prepaid expenses and deferred rent and
non-acquisition accrued expenses, partially offset by an increase in trade and other receivables and deferred income
taxes. Funds provided by operating activities in fiscal 2006 primarily resulted from net income, adjusted for
non-cash items such as depreciation and amortization and stock based compensation expense, and a decrease in
non-acquisition accrued expenses, partially offset by an increase in prepaid expenses.
Investing Activities
Capital expenditures are the largest ongoing component of our investing activities and include expenditures for
new bakery-cafes and fresh dough facilities, improvements to existing bakery-cafes and fresh dough facilities, and
other capital needs. A summary of capital expenditures for the periods indicated consisted of the following
(in thousands):
December 30,
2008
December 25,
2007
December 26,
2006
For the Fiscal Year Ended
New bakery-cafe and fresh dough facilities .......... $39,122 $ 92,864 $ 78,652
Bakery-cafe and fresh dough facility improvements .... 20,665 27,617 25,775
Other capital needs ............................ 3,376 3,652 4,869
Total ..................................... $63,163 $124,133 $109,296
Our capital requirements, including development costs related to the opening or acquisition of additional
bakery-cafes and fresh dough facilities and maintenance and remodel expenditures, have and will continue to be
significant. Our future capital requirements and the adequacy of available funds will depend on many factors,
including the pace of expansion, real estate markets, site locations, and the nature of the arrangements negotiated
with landlords. We believe that our cash flow from operations, as well as available borrowings under our existing
credit facility, will be sufficient to fund our capital requirements for the foreseeable future. We currently anticipate
total capital expenditures for fiscal 2009 of approximately $75 million, which consists of the following: $40 million
related to the opening of 32 to 36 new Company-owned bakery-cafes and the costs incurred on early 2010 openings;
$25 million related to the remodeling of existing bakery-cafes; and $10 million related to the remodeling and
expansion of fresh dough facilities as well as other capital needs including expenditures on our concept, information
technology, and infrastructure. We expect future bakery-cafes will require, on average, an investment per bakery-
cafe (excluding pre-opening expenses which are expensed as incurred) of approximately $0.9 million, which is net
of landlord allowances and excludes capitalized development overhead. Our fiscal 2009 projection of capital
expenditures for new Company-owned bakery-cafes reflects our 2008 decision to reduce our bakery-cafe growth in
an effort to focus on our return on invested capital. Our strategy to improve return on invested capital includes
35