Financial Analysis of Panera Bread Company, Inc.

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Financial Analysis of Panera Bread Company, Inc. FIN-643 May 12, 2012 Headquartered out of Richmond Heights, Missouri, Panera Bread Company operates and franchises a retail bakery café business under the concept names Panera Bread Company, St. Louis Bread Company, and Paradise Bakery. The company's retail operations consist of more than 1,200 units with a company-owned to franchise mix of about 43/57, and generate about $2.3 billion in system wide sales. Panera Bread specializes in baking hand-crafted, artisan breads and is well known for its fresh baked goods, made-to-order sandwiches on fresh baked breads, soups, salads, custom roasted coffees and other specialty espresso-based beverages. Panera Bread's typical consumers are suburban dwellers and workers that crave and seek out the specialty bakery café experience with a neighborhood, or gathering place emphasis. The Company's bakery cafés are principally located in suburban, strip mall and regional mall locations. Panera is the largest bakery café concept in the U.S. and the dominant company in the high-growth $15 billion Fast Casual dining segment. Management continues to roll out new and exciting products to stimulate consumer appetites. Along with Panera's lower check average versus casual, and its high-volume lunch business, Panera appears positioned nicely to increase sales and continue taking market share. I am a firm believer in the long-term merits of this dominant café bakery concept. Management's commitment to quality and brand building are stronger than ever, and should continue to help it attract consumers across a varied spectrum including those that are health conscious, time constrained, and value driven. Panera aligns very nicely with the investment thesis that fast food (and Fast Casual) operators will continue to outperform casual dining on the Big-3 consumer discretionary issues of

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