Mr. Shaich: Panera Bread operates, as of the end of the third quarter, 231 bakery-cafes in 27 states across the United States. It was originally formed in 1987 as the Saint Louis Bread Co. It was purchased in 1993 by Au Bon Pain Co., Inc. At that time, it consisted of 19 stores doing approximately 1 million each. It was run under an earn-out in 1994-1995. In 1996 the EBITDA was up over 200%, and same store sales were up 10%. This occurred again in 1997. Essentially, Au Bon Pain Co., Inc. began to recognize that this concept had the potential to be a dominant national brand. In late 1997, we made what was at that point one of the very toughest decisions the company ever faced. That was the decision to sell all our other businesses, including our namesake, Au Bon Pain, to ensure that Saint Louis Bread, later renamed Panera Bread, had all the human and financial resources we could muster. We wanted to ensure that it had the greatest opportunity to succeed and fulfill its destiny as a high growth, nationally dominant brand. In May 1999 we completed the necessary transactions. At that point, Panera Bread consisted of 143 bakery-cafes. It was essentially debt free, with tax credits, and 546 franchise commitments in place. Simultaneous with all of these transactions, we renamed Au Bon Pain Co., Inc., which now had only one division, Panera Bread Company.
TWST: Who bought Au Bon Pain?
Mr. Shaich: Bruckmann, Rosser, Sherrill.
Tickers included in this excerpt: PNRA
For more information call (212) 952 7433. The Wall Street Transcript does not endorse any of the comments made by interviewees, and does not make stock recommendations.