Negative transaction growth will only get greater.
Based on what has become a very fragile consumer environment, the Company now expects negative transaction growth in the fourth quarter of 2008 ranging from (4.0%) to (2.0%). The result is that the Company is now targeting comparable Company-owned bakery-cafe sales growth of 1.0% to 3.0% in the fourth quarter of 2008. (Investors will note that this target for sales growth is lower than prior guidance, while the earnings target remains the same. Accordingly, the Company now believes it will be a greater challenge to achieve the high-end of its fourth quarter target of 46% to 54% earnings per diluted share growth).
The Company is today announcing that through the first 27 days of the fourth quarter of fiscal 2008 (September 24, 2008 to October 20, 2008), comparable bakery-cafe sales for Company-owned bakery-cafes have grown approximately 2.1% (net of negative transaction growth of approximately 3.4%) and comparable bakery-cafe sales for franchise-operated bakery-cafes have grown approximately 3.0%.