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Cosi Inc. Message Board

  • corruptbusinesss corruptbusinesss Jul 21, 2011 4:58 PM Flag

    2nd quarter is laughable

    Total revenues for the 2011 second quarter decreased by $2,727,000 to $26,896,000 from $29,623,000 in the second quarter of 2010.

    Così noted that the Company-owned comparable restaurant miniscule sales increase for the 2011 second quarter resulted from a 2.9% increase in average check partially offset by a 2.4% decrease in traffic.

    They make it sound that a 2.9% increase in average check might indicate better chance of profit if they didn't at the same time increase their overhead. Anyone think that will be the case?

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    • Not sure why anyone would buy this. I think McDonald's buying spree of a variety of concepts many years ago (Boston Market, Donato's, etc) showed that their buying power can't make bad concepts better. Chipotle has enough runway (they could double their unit count)in front of them and drive phenomenal margins with a PSA of $1.8 million. There is zero rationale for why they need someone like Cosi even if it is pocket change. They are smart operators and not prone to throw money at something.

      About the only thing that might make sense is for someone like Potbelly (a fellow Chicago based sandwich chain) to get convinced they could make it work. The roadside is littered with failed "strategic" acquisitions so I don't hold out much hope for that to happen. It's more likely that a cash flush PE firm (Sun Capital likes challenged restaurant concepts) buys them. Not holding my breath.

    • CMG is looking at concepts all the time and with their stock price an acquisition like COSI is petty cash.

      Not saying CMG is looking, just pointing out they could hit the ground running with it, leverage buying power in real estate, commodities, marketing, etc, etc, etc

      Yeah, you can wait for the quarter and if Hyatt just keeps on, keeping on you wait for that selloff.

      Still I want to figure a price that I am comfortable buying and buy it when I get it before or after the call.

      It sure looks like .70's could easily hit and depending where orders are sitting I can see .60's on mm games, market weakness, etc. The longer it goes on the longer all the sub $1 games start again, with delisting issues, etc.

      Again, for now this is a speculative play only.

    • Honestly i think Hyatt is a great operations guy but lets face facts, Burger King and its household name sell themselves, Cosi franchises dont ! Without some miracle that we might hear about a growth plan it seems everyone there is hanging and waiting for a better economy ? Really ? Is that what is going on ? No plan your planing to fail !

      Im tired of hearing about the economic excuse. Chipolte exploded during this time. Im also seeing these 5 Guys places opening up everywhere. There is still the same amount of hungry people walking this planet. If the guy next door to you is busy, then your doing something wrong.

      Excuses are endless from this company at this point. I have been to locations where lines are out the door. Maybe this CMGslob guy is right. Someone might have hands in the pot.

      • 1 Reply to dj_kevhead
      • "Someone might have hands in the pot."
        I owned a business where one of my most trusted employees was found to be stealing thousands each month which was basically most of our profits so I guess it is as good of an explanation as any other.

        I have always thought Hyatt's resume indicated he should be able to turn Cosi around but he just can't seem to get beyond the small picture which while important is not enough. I don't see the end game any longer. All I see is them running out of money again. Not sure why he hangs around if he is as good as I thought. Which makes me wonder if he is on his way out the door.
        I'm surprised we have not gone down more today which maybe is an indication very few holders of this stock and certainly no speculators. I suspect we are going to see a slow bleed down and after Aug meeting more sell off. I wish it wasn't the case but wishing is no way to invest.

    • Actually the numbers look somewhat encouraging to me...
      you had 13.4% sequential quarter over quarter growth this year vs. last year's 7.3%. SSSG of (.5%) while disappointing was with traffic down 2.4%. Now if they can drive traffic without depending on discounting that would be good. What is unclear is the rev number from Q2 2010...what was from stores that were sold during that quarter and what was from one time credits received that quarter. The comparison of $26.896 MM to $29.623 MM is rather opaque to me. These numbers aren't great but are not "laughable" and somewhat encouraging they may have a chance to turn cash flow positive, IMO.

      I am still anxious to hear their growth plans/model they will utilize. Still unclear how they plan on doing so. Need capital infusion to roll out more stores or franchisee plans in a big way. What is their new hire John Gohde there to do? Would also like to see management commitment buy doing some buying of the stock. Would give a vote of confidence that they have a plan and are in it for the long haul.

      • 1 Reply to collelungo2000
      • These numbers are not great but not laughable.

        You must remember that Hyatt who has never bought any shares himself said that all they need to do in 2011 is generate roughly what they did in 2008 or so. The second half is going to need to set new record highs for revenues. Are you laughing now?

        I do not think we will get a growth plan from Hyatt. I do think we might hear how tough it is to do business in today's climate. It really takes a leap of faith to be Cosi share holder. My faith has been tested once too often. Can you tell? The hope now is that Cosi gets bought so they might expand to new markets. Like mine. I would like to have a Cosi close so I had another choice besides Panera.

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