Panera Bread’s Same-Store Sales Growth Declined In 4Q14
Investing In Panera Bread? Key Takeaways From Its 4Q14 Earnings (Part 2 of 9)
Panera Bread’s same-store sales
In the last part of this series, we discussed that Panera Bread’s (PNRA) revenue increased 1.6% year-over-year, or YoY. Let’s see how same-store sales growth added to Panera Bread’s growth.
In the restaurant industry, revenue is driven by two key drivers:
Same-store sales
Unit growth
System-wide refers to all of the company-owned and franchise restaurants combined. The system-wide same-store sales grew 2.7%—compared to 8.1% in the same quarter last year. We’ll discuss the same-store sales growth for company-operated and franchised restaurants below.
Same-store sales
Same-store sales for company-operated stores grew 3.3%—compared to 8.7% in the same quarter last year. Franchised same-store sales growth was down to 3.3%—compared to 8% over the same period last year.
What drove same-store sales?
For Panera Bread, the YoY weakness in same-store sales growth was primarily due to a weakness in transaction or traffic. Traffic grew 1.3%. The average check grew 2%. We’ll discuss transaction and average check in more detail later in this series.
Competitors’ same-store sales
Chipotle Mexican Grill (CMG) is another fast-casual restaurant chain. It saw same-store sales growth of 16.1% in the fourth quarter. Fast food chain McDonald’s (MCD) recorded same-store sales of -1.7% in the US. Dunkin’ Brands (DNKN) had a growth of 1.2% YoY. So, the latter two chains are also struggling like Panera Bread. Noodles & Company (NDLS) is another fast-casual restaurant.
If you’re looking to invest in a mix of the restaurant formats mentioned above, then you may consider an ETF like the Consumer Discretionary Select Sector SPDR Fund (XLY. It holds ~37% of retail stocks—including restaurants.
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