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I listened in on the conference call this morning.
They covered a lot of things that were in the press release but there was some other good things said as well. My summary is as follows:

Reason for sale - Au Bon Pain unit has to invest in their ABP 2000 concept to succeed. This competed for capital with the SLB concept. The sale gives Au Bon Pain new source of capital and debt free. They stated that SLB will use the proceeds to eliminate all debt and have a little left over (1.50 a share)to build some Cafes. Everyone's happy (yeah right).

Sale price - approx 78 million or 4 times cash flow. Not great but these were non-performing assets IMO.

Quarter results - SLB unit revenues up 18%, operating income was up slightly. SLB Operating income not great because of the infrastructure they are paying now for future earnings coming from new stores. They mentioned they were building commisaries.

New Company - Name will most likely be Saint Louis Bread Co. But, the cafe's will still be called Panera outside of St. Louis.

SLB numbers - They gave some numbers in a pro forma fashion for SLB. They said EBIT (Earnings Before Interest and Tax) was, rounding off, .7,3.6 and 6.7 Million for 95,96& 97. They commented this didn't include overhead, which they estimated at 1.7 and 2.3 for 96 and 97. No estimates were given for future performance.

Future plans - '99 they will open 22 company owned and 54 franchises. Long term goal was 1/3 company owned and 2/3 franchises. They said they look for penetration rates of 1 store for every 100,000 people although they are much more concentrated in St. Louis. Someone else mentioned they had a virtual lock on the lunch market in St. Louis. I have relatives in St. Louis, they concur. I did a quick calculation on 250 million in the US and came up with 2,500 cafe's. They now have 129, sorry, I get a little ahead of myself. No plans for the west coast at least half way through the year 2000. Unfortunately, this is where I live.

That's all I have, hope it was informative.

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To futuretrust,

Many thanks for the informative conference call report! I must confess that I haven't bought ABPCA, but I will definitely keep up with the news about it. I really want to buy it, but I need to see better financials in the next quarter.

I know I can't be objective, I am a St. Louisan, but I hope that they call new stores "St. Louis Bread Company." "Panera Bread" just doesn't have a classy ring to it, IMHO.

At the risk of hyperbole, there really should be several SLBs in every major city in the U.S. As someone who eats out every day, the market is SCREAMING for good, non-fatty, not-too-expensive, fast food at lunchtime. (In my experience, Boston Market is too slow, service too haphazard.)

BTW, I also own Starbucks. I understand that they will open "Starbucks Cafes." So, SBUX may turn into a competitor, or, perhaps?, a buyer of ABPCA. Frankly, I think SLB and Starbucks project a similar image. If this purely-speculative-on-my-part scenario does occur, I will probably miss out on profiting via ABPCA stocks, since I don't intent to buy until at least the next quarter's report.

Thanks again for the very informative conference report!

Joe Grant
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The sale is now going through at 74 million due to ABP's last quater numbers, and will go down even lower when the finals go in. The reason Panaera changed names was that they were unable to copyright Saint Louis Bread.
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Thanks for the update! I am still watching and waiting...

-- Joe Grant
St. Louis
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