Panera Bread 2015 Annual Report Download - page 32

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22
We include in this report information on Company-owned, franchise-operated, and system-wide comparable net bakery-cafe sales
percentages. Bakery-cafes in our comparable net bakery-cafe sales percentages include those bakery-cafes with an open date prior
to the first day of our prior fiscal year, which we refer to as our base store bakery-cafes. Company-owned comparable net bakery-
cafe sales percentages are based on net sales from Company-owned base store bakery-cafes. Franchise-operated comparable net
bakery-cafe sales percentages are based on net sales from franchise-operated base store bakery-cafes, as reported by franchisees.
System-wide comparable net bakery-cafe sales percentages are based on net sales at Company-owned and franchise-operated base
store bakery-cafes. Acquired Company-owned and franchise-operated bakery-cafes and other restaurant or bakery-cafe concepts
are included in our comparable net bakery-cafe sales percentages only if we or our franchisee previously held or acquired a
100 percent ownership interest prior to the first day of our prior fiscal year. Comparable net bakery-cafe sales exclude closed
locations.
We do not record franchise-operated net bakery-cafe sales as revenues. However, royalty revenues are calculated based on a
percentage of franchise-operated net bakery-cafe sales, as reported by franchisees. We use franchise-operated and system-wide
sales information internally in connection with store development decisions, planning, and budgeting analyses. We believe
franchise-operated and system-wide sales information is useful in assessing consumer acceptance of our brand, facilitates an
understanding of our financial performance and the overall direction and trends of sales and operating income, helps us appreciate
the effectiveness of our advertising and marketing initiatives, to which our franchisees also contribute based on a percentage of
their net sales, and provides information that is relevant for comparison within the industry.
We also include in this report information on Company-owned, franchise-operated, and system-wide average weekly net sales.
Average weekly net sales are calculated by dividing total net sales in the period by operating weeks in the period. Accordingly,
year-over-year results reflect sales for all locations, whereas comparable net bakery-cafe sales exclude closed locations and are
based on sales only from our base store bakery-cafes. New stores typically experience an opening “honeymoon” period during
which they generate higher average weekly net sales in the first 12 to 16 weeks after opening, after which customers “settle-in”
to normal usage patterns. On average, average weekly net sales during the “settle-in” period are 5 percent to 10 percent less than
during the “honeymoon” period. As a result, year-over-year results of average weekly net sales are generally lower than the results
in comparable net bakery-cafe sales. This results from the relationship of the number of bakery-cafes in the “honeymoon” period,
the number of bakery-cafes in the “settle-in” period, and the number of bakery-cafes in the comparable bakery-cafe base.
Executive Summary of Results
Overview
• Total revenues increased 6.0 percent to $2,682 million in fiscal 2015 compared to $2,529 million in fiscal 2014.
• Fiscal 2015 Company-owned comparable net bakery-cafe growth of 3.0 percent comprised of year-over-year average
check growth of 2.2 percent and transaction growth of 0.8 percent.
• Earnings per diluted share for fiscal 2015 was $5.79 compared to earnings per diluted share of $6.64 in fiscal 2014.
Included in earnings per diluted share for fiscal 2015 were charges related to our refranchising initiative of $0.42 per
diluted share. Included in earnings per diluted share for fiscal 2014 was a total benefit of $0.16 per diluted share from
the favorable resolution of an insurance coverage matter, additional federal tax credits, and an increased deduction for
domestic production activities, and a goodwill impairment charge of $0.05 per diluted share.
• Completed the conversion of 304 bakery-cafes to Panera 2.0 during fiscal 2015, bringing the total number of conversions
to 410.
• Completed the refranchising of 75 Company-owned bakery-cafes during fiscal 2015 for proceeds of $47 million.
• We returned $400 million to our stockholders in fiscal 2015 through share repurchases compared to $154 million in fiscal
2014.