Panera Bread 2012 Annual Report Download - page 75

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PANERA BREAD COMPANY
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
67
The Franchise Operations segment is comprised of the operating activities of the franchise business unit, which licenses qualified
operators to conduct business under the Panera Bread or Paradise Bakery & Café names and also monitors the operations of these
bakery-cafes. Under the terms of most of the agreements, the licensed operators pay royalties and fees to the Company in return
for the use of the Panera Bread or Paradise Bakery & Café names.
The Fresh Dough and Other Product Operations segment supplies fresh dough, produce, tuna, cream cheese, and indirectly supplies
proprietary sweet goods items through a contract manufacturing arrangement, to Company-owned and franchise-operated bakery-
cafes. The fresh dough is sold to a number of both Company-owned and franchise-operated bakery-cafes at a delivered cost
generally not to exceed 27 percent of the retail value of the end product. The sales and related costs to the franchise-operated
bakery-cafes are separately stated line items in the Consolidated Statements of Comprehensive Income. The operating profit related
to the sales to Company-owned bakery-cafes is classified as a reduction of the costs in the cost of food and paper products in the
Consolidated Statements of Comprehensive Income.
The accounting policies applicable to each segment are consistent with those described in Note 2, “Summary of Significant
Accounting Policies.” Segment information related to the Company’s three business segments is as follows (in thousands):
For the fiscal year ended
December 25,
2012 December 27,
2011 December 28,
2010
Revenues:
Company bakery-cafe operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,879,280 $ 1,592,951 $ 1,321,162
Franchise operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,076 92,793 86,195
Fresh dough and other product operations . . . . . . . . . . . . . . . . . . . . . . . . . 312,308 275,096 252,045
Intercompany sales eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (163,607)(138,808)(116,913)
Total revenues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,130,057 $ 1,822,032 $ 1,542,489
Segment profit:
Company bakery-cafe operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 380,432 $ 307,012 $ 249,177
Franchise operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95,420 86,148 80,397
Fresh dough and other product operations . . . . . . . . . . . . . . . . . . . . . . . . . 17,695 20,021 24,146
Total segment profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 493,547 $ 413,181 $ 353,720
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90,939 79,899 68,673
Unallocated general and administrative expenses. . . . . . . . . . . . . . . . . . . . 111,276 106,438 95,696
Pre-opening expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,462 6,585 4,282
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,082 822 675
Other (income) expense, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,208)(466) 4,232
Income before income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 282,996 $ 219,903 $ 180,162
Depreciation and amortization:
Company bakery-cafe operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 78,198 $ 68,651 $ 57,031
Fresh dough and other product operations . . . . . . . . . . . . . . . . . . . . . . . . . 6,793 6,777 7,495
Corporate administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,948 4,471 4,147
Total depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 90,939 $ 79,899 $ 68,673
Capital expenditures:
Company bakery-cafe operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 122,868 $ 94,873 $ 66,961
Fresh dough and other product operations . . . . . . . . . . . . . . . . . . . . . . . . . 13,434 6,483 6,452
Corporate administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,026 6,576 8,813
Total capital expenditures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 152,328 $ 107,932 $ 82,226