Panera Bread 2014 Annual Report Download - page 6

Closing Thoughts
I liken what Panera is going through to what a winning sports team experiences as it rebuilds. Take my beloved
Celtics, recent NBA champs now working to regain championship status. I have no doubt that Danny Ainge, the
general manager who has taken the Celtics through this cycle before, will persevere in building a winning team
again. And I have no doubt that we can return Panera to the top of its game.
After all, we have done just that several times before in the history of our company. We did it in the mid-1990s.
During those years, we evolved Saint Louis Bread Company into Panera, establishing a vision for what would
become the fast-casual market segment. Back then, people had their doubts. In 1996 and 1997, you could have
bought as much of our stock as you liked for between $3 and $4.
We did it again in the late 1990s, when we sold Au Bon Pain to focus all of our energy on Panera. In 1999, some
people doubted us. The reality is in 1999 you could have bought our stock for about $3.
And we did it in 2008, when we invested in the customer experience despite the recession. Our actions led to
increased same-store sales at a time when other restaurant companies were cutting back on the guest experience
even as they were reporting significant declines in guest traffic. The result…our stock price nearly doubled in
2009, versus 2008.
In fact, as I write this letter, Panera has delivered over the last fifteen years a total return of nearly 4,000% to
shareholders, as compared to 39% for the S&P 500. Over the past five years, the company has delivered a total
return to shareholders of more than 100%, as compared to about 75% for the S&P 500. These results demonstrate
that Panera’s Board and management have a track record of executing step function initiatives that create
significant value.
To that end, we recognize that rebuilding is necessary and difficult. First, you must have a vision; then, you must
have the tenacity and patience to bring that vision to life.
Let me be clear, it would be easier to squeeze costs for several years, but the payoff would be fleeting. As a
shareholder with the vast preponderance of my personal wealth invested in the company, I truly believe that (as
in the past) shareholders will benefit most when we change the trajectory of our relationship with guests and
expand growth opportunities. Though the path we have chosen may be more difficult, I am confident it will
ultimately lead to more sustainable and longer-lasting earnings expansion.
I want to thank our investors for their ongoing commitment and belief in our vision; our board of directors for
their wise counsel; and our franchise partners, operators and support team members for their hard work, day in
and out, as they power us through our transition and move us into the future.
All my best,
Ronald Shaich
Founder, Chairman and Chief Executive Officer