Business Segment Information

6 Months Ended

Jun. 28, 2016

Segment Reporting [Abstract]

Business Segment Information

Business Segment Information

The Company operates three business segments. The Company Bakery-Cafe Operations segment is comprised of the operating activities of the bakery-cafes owned by the Company. The Company-owned bakery-cafes conduct business under the Panera Bread®, Saint Louis Bread Co.® or Paradise Bakery & Café® names. These bakery-cafes offer some or all of the following: fresh baked goods, made-to-order sandwiches on freshly baked breads, soups, salads, pasta dishes, custom roasted coffees, and other complementary products through on-premise sales, as well as catering.

The Franchise Operations segment is comprised of the operating activities of the franchise business unit, which licenses qualified operators to conduct business under the Panera Bread or Paradise Bakery & Café names and also monitors the operations of these bakery-cafes. Under the terms of most of the agreements, the licensed operators pay royalties and fees to the Company in return for the use of the Panera Bread or Paradise Bakery & Café names.

The Fresh Dough and Other Product Operations segment supplies fresh dough, produce, tuna, and cream cheese, and indirectly supplies proprietary sweet goods items through a contract manufacturing arrangement, to Company-owned and franchise-operated bakery-cafes. The fresh dough is sold to a number of both Company-owned and franchise-operated bakery-cafes at a delivered cost generally not to exceed 27 percent of the retail value of the end product. The sales and related costs to the franchise-operated bakery-cafes are separately stated line items in the Consolidated Statements of Income. The sales, costs, and operating profit related to the sales to Company-owned bakery-cafes are eliminated in consolidation in the Consolidated Statements of Income.

Segment information related to the Company’s three business segments is as follows (in thousands):

	For the 13 Weeks Ended						For the 26 Weeks Ended
	June 28, 2016			June 30, 2015			June 28, 2016			June 30, 2015
Revenues:
Company bakery-cafe operations	$	609,284		$	598,124		$	1,208,068		$	1,171,800
Franchise operations	38,017			32,819			75,869			65,212
Fresh dough and other product operations	102,380			97,767			198,279			187,891
Intercompany sales eliminations	(50,781		)	(52,053		)	(98,163		)	(99,742		)
Total revenues	$	698,900		$	676,657		$	1,384,053		$	1,325,161
Segment profit:
Company bakery-cafe operations (1)	$	94,834		$	92,945		$	193,949		$	178,943
Franchise operations	36,748			31,679			73,200			62,758
Fresh dough and other product operations	6,588			5,462			12,887			11,631
Total segment profit	$	138,170		$	130,086		$	280,036		$	253,332
Depreciation and amortization	$	38,831		$	32,335		$	75,088		$	66,282
Unallocated general and administrative expenses	37,668			27,033			84,450			63,486
Pre-opening expenses	1,440			2,306			3,636			3,955
Interest expense	1,791			417			3,530			903
Other (income) expense, net	114			1,187			(137		)	1,003
Income before income taxes	$	58,326		$	66,808		$	113,469		$	117,703
Depreciation and amortization:
Company bakery-cafe operations	$	29,237		$	25,359		$	56,934		$	52,694
Fresh dough and other product operations	2,533			2,225			4,638			4,534
Corporate administration	7,061			4,751			13,516			9,054
Total depreciation and amortization	$	38,831		$	32,335		$	75,088		$	66,282
Capital expenditures:
Company bakery-cafe operations	$	35,469		$	42,592		$	70,347		$	78,110
Fresh dough and other product operations	4,634			3,499			10,559			4,493
Corporate administration	8,279			9,191			18,049			22,253
Total capital expenditures	$	48,382		$	55,282		$	98,955		$	104,856

(1) Includes refranchising losses of $7.9 million and $0.7 million for the thirteen weeks ended June 28, 2016 and June 30, 2015, respectively, and $8.9 million and $9.6 million for the twenty-six weeks ended June 28, 2016 and June 30, 2015, respectively.

	June 28, 2016		December 29, 2015
Segment assets:
Company bakery-cafe operations	$	894,829	$	953,717
Franchise operations	13,841		13,049
Fresh dough and other product operations	82,709		75,634
Total segment assets	$	991,379	$	1,042,400
Unallocated cash and cash equivalents	$	160,018	$	241,886
Unallocated trade and other accounts receivable	4,482		2,968
Unallocated property and equipment	112,104		107,333
Unallocated deposits and other	5,793		6,660
Other unallocated assets	24,717		39,592
Total assets	$	1,298,493	$	1,440,839

“Unallocated cash and cash equivalents” relates primarily to corporate cash and cash equivalents, “unallocated trade and other accounts receivable” relates primarily to rebates and interest receivable, “unallocated property and equipment” relates primarily to corporate fixed assets, “unallocated deposits and other” relates primarily to insurance deposits, and “other unallocated assets” relates primarily to refundable income taxes.