Panera, Brinker report soft same-store sales for May

Nation's Restaurant News,  June 18, 2007  

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Restaurant chains continued to report weak sales performances for May, with Panera Bread Co. posting a systemwide same-store sales gain of only 1.2 percent and Brinker International Inc. reporting a 2.8-percent decline across its four-chain system.

While Panera's result was positive for the five weeks ended May 29, it was a relatively anemic result for the bakery-cafe brand, which typically boasts high-single-digit same-store-sales gains.

The slower sales, coupled with margin pressures associated with a shift away from products manufactured by Panera in its facilities as well as gasoline and other costs, led the Richmond Heights, Mo.-based company to slash its second-quarter, per-share earnings expectations to between 38 cents and 40 cents from previous guidance of between 47 cents and 51 cents. A year ago, Panera earned 44 cents per share.

The company said same-store sales for the full second quarter, which ends in June, are expected to rise between 1.5 percent and 2.5 percent, down from original projections of gains between 3.5 percent and 4.5 percent.

The bad news pushed Panera's stock price down nearly 14 percent June 6.

Panera operates or franchises about 1,101 bakery-cafes under the Panera and St. Louis Bread Co. brands.

Dallas-based casual-dining giant Brinker said same-store sales at its flagship Chili's Grill & Bar chain for the four weeks ended May 30 dropped 3 percent, compared with the same period a year ago. Same-store sales fell 2.1 percent at Romano's Macaroni Grill, 4.2 percent at On the Border Mexican Grill & Cantina and 1.5 percent at Maggiano's Little Italy. Brinker and its franchisees operate 1,756 restaurants under the four brands.

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