UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 11, 2009
Bob Evans Farms, Inc.
 
(Exact name of registrant as specified in its charter)
         
Delaware   0-1667   31-4421866
 
(State or other jurisdiction
of incorporation) 		  (Commission
File Number) 		  (IRS Employer
Identification No.)
     
3776 South High Street, Columbus, Ohio   43207
 
(Address of principal executive offices)   (Zip Code)
(614) 491-2225
 
(Registrant’s telephone number, including area code)
Not Applicable
 
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):
      o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
      o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
      o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
      o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 

 

Item 2.02.   Results of Operations and Financial Condition .
     On August 11, 2009, Bob Evans Farms, Inc. (the “Company”) issued a news release announcing financial results for the fiscal 2010 first quarter ended July 24, 2009. A copy of this news release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
     The Company also made available in conjunction with the news release additional quarterly financial information as of and for the fiscal 2010 first quarter ended July 24, 2009. The additional quarterly information is furnished as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.
     The information in this Current Report on Form 8-K, including the information contained in Exhibit 99.1 and Exhibit 99.2, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liability of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as otherwise explicitly stated in such filing.
Item 9.01.   Financial Statements and Exhibits .
  (a)   Financial Statements of Business Acquired – Not Applicable
 
  (b)   Pro Forma Financial Information – Not applicable
 
  (c)   Shell Company Transactions – Not Applicable
 
  (d)   Exhibits:
     The following exhibits are included with this Current Report on Form 8-K:
     
Exhibit No.   Description
99.1
  News release issued by Bob Evans Farms, Inc. on August 11, 2009, announcing financial results for the fiscal 2010 first quarter ended July 24, 2009
 
   
99.2
  Additional quarterly financial information made available by Bob Evans Farms, Inc. in conjunction with the news release issued on August 11, 2009

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SIGNATURES
     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
         
  BOB EVANS FARMS, INC.
  		 
Dated: August 11, 2009  By:   /s/ Donald J. Radkoski    
    Donald J. Radkoski   
    Chief Financial Officer, Treasurer and Assistant Secretary    
 

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INDEX TO EXHIBITS
Current Report on Form 8-K
Dated August 11, 2009
         
Exhibit No.   Description
  99.1    
News release issued by Bob Evans Farms, Inc. on August 11, 2009, announcing financial results for the fiscal 2010 first quarter ended July 24, 2009
 
  99.2    
Additional quarterly financial information made available by Bob Evans Farms, Inc. in conjunction with the news release issued on August 11, 2009

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Exhibit 99.1
BOB EVANS ANNOUNCES FIRST-QUARTER RESULTS
Net income increases 17 percent, driven by restaurant margin improvements and favorable tax rate
Productivity gains offset sales declines
Company reaffirms outlook for fiscal 2010
COLUMBUS, Ohio – Aug. 11, 2009 – Bob Evans Farms, Inc. (NASDAQ: BOBE) today announced financial results for the 2010 first fiscal quarter ended Friday, July 24, 2009.
First-quarter commentary
Chairman and Chief Executive Officer Steve Davis said effective cost management enabled the Company to meet its first-quarter operating income goals, despite significant top-line challenges. “The restaurant segment continues to improve its profitability due to lower cost of sales and well-controlled labor costs, even with negative sales relative to the prior year,” Davis said. “This improvement more than offset the food products segment’s operating income decline, which was due primarily to a 51 percent year-over-year increase in sow costs.
“Our same-store sales were below our expectations in a quarter where both restaurant concepts faced their toughest comps of the year,” Davis said. “However, third-party research from NPD Group and Knapp-Track indicates both restaurant concepts trended better than their respective peer groups in June and July.
“The food products segment faced similar top-line challenges, overlapping 13 percent comparable pounds-sold growth in the prior year, in a quarter where we reduced our promotional discounts offered to retailers in an effort to maintain margins.
“Despite these top-line challenges, our strong cost-management efforts in the first quarter have given us the confidence to reaffirm our operating income outlook for the 2010 fiscal year.”
First-quarter consolidated results
The Company reported operating income of $25.1 million in the first quarter of fiscal 2010, a 6.9 percent increase compared to $23.5 million in the first quarter of fiscal 2009. This improvement is due primarily to significantly lower food and operating expenses in the restaurant segment, as well as lower SG&A in the food products segment. The Company’s first-quarter fiscal 2009 reported results included expenses of $0.7 million for a legal settlement.

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The Company reported net income of $16.1 million in the first quarter of fiscal 2010, a 16.7 percent increase compared to $13.8 million in the first quarter of fiscal 2009. The net income improvement is due to the factors cited for the operating income comparison, as well as a 500 basis-point year-over-year improvement in the Company’s first-quarter effective tax rate.
Below is a line-by-line summary of the Company’s consolidated fiscal 2010 first-quarter income statement.
•   Net sales – Net sales were $429.5 million in the first quarter of fiscal 2010, a 2.5 percent decrease compared to $440.3 million in the first quarter of fiscal 2009. This decrease is the result of same-store sales declines at Bob Evans Restaurants and Mimi’s Café, as well as sales declines in the food products segment.
 
•   Cost of sales – Cost of sales was $125.5 million, or 29.2 percent of net sales, in the first quarter of fiscal 2010, compared to $130.4 million, or 29.6 percent of net sales in the first quarter of fiscal 2009. The lower cost of sales is primarily the result of lower commodities costs, positive mix shifts and effective supply chain management in the restaurant segment, partially offset by a 51 percent year-over-year increase in sow costs in the food products segment, which averaged $43.00 per hundredweight compared to $29.00 a year ago. The higher cost of sales in the food products segment reduced operating income by approximately $2.2 million, or 320 basis points, compared to a year ago.
 
•   Operating wages – Operating wages were $150.1 million, or 34.9 percent of net sales, in the first quarter of fiscal 2010, compared to $152.7 million, or 34.7 percent of net sales, in the first quarter of fiscal 2009. This increase as a percentage of sales is the result of minimum wage increases and negative leverage due to same-store sales declines at both restaurant concepts, partly offset by a reduction in labor hours in the restaurant segment.
 
•   Other operating expenses – Other operating expenses were $69.5 million, or 16.2 percent of net sales, in the first quarter of fiscal 2010, compared to $73.6 million, or 16.7 percent of net sales, in the first quarter of fiscal 2009. This improvement is due to lower utility, pre-opening and advertising expenses in the restaurant segment.
 
•   SG&A – Selling, general and administrative expenses were $38.4 million, or 8.9 percent of net sales in the first quarter of fiscal 2010, compared to $40.2 million, or 9.1 percent of net sales, in the first quarter of fiscal 2009. This improvement is due to the benefit of converting the food products segment from a direct-store-delivery (or DSD) distribution system to a warehouse system in response to retailer needs, as well as the favorable variance from the $0.7 million in expenses for a legal settlement in last year’s first quarter, which offset deleverage from declining sales.
 
•   Net interest expense – The Company’s net interest expense was $2.7 million in the

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    first quarter of fiscal 2010 compared to $2.9 million in the first quarter of fiscal 2009.
 
•   Income taxes – The Company’s effective tax rate for the first quarter of fiscal 2010 was 28.1 percent. This compares to an effective tax rate of 33.1 percent in the first quarter of fiscal 2009. The lower effective tax rate is the result of more favorable settlements with state income tax agencies than anticipated.
 
•   Diluted weighted-average shares outstanding – The Company’s diluted weighted-average share count was 30.9 million in both the first quarter of fiscal 2010 and in the first quarter of fiscal 2009. The Company did not repurchase shares in the first quarter.
First-quarter restaurant segment summary
The restaurant segment reported operating income of $20.4 million, or 5.7 percent of net sales, in the first quarter of fiscal 2010, compared to $17.6 million, or 4.8 percent of net sales, in the first quarter of fiscal 2009. This improvement is due primarily to significantly lower cost of sales, resulting from more favorable commodities costs, effective supply chain management and mix shifts to higher-margin products, as well as lower operating expenses. Below is a summary of the restaurant segment’s first-quarter 2010 income statement:
Net sales – The restaurant segment’s net sales decreased 2.3 percent compared to a year ago, from $368.1 million in the first quarter of fiscal 2009 to $359.8 million in the first quarter of fiscal 2010. Same-store sales at Bob Evans Restaurants were down 3.0 percent in the first quarter of fiscal 2010, with average menu prices up 2.4 percent. At Mimi’s Café, same-store sales decreased 6.4 percent for the first quarter of fiscal 2010, with average menu prices up 2.3 percent. See the table below for month-by-month same-store sales results by restaurant concept. In the first quarter of fiscal 2010, the Company closed one Bob Evans restaurant and did not open any new restaurants.
Cost of sales – The restaurant segment’s cost of sales decreased 100 basis points from 25.5 percent of net sales in the first quarter of fiscal 2009 to 24.5 percent in the first quarter of fiscal 2010. This improvement is due to lower commodities costs, effective supply chain management and mix shifts to higher-margin products.
Operating wages – The restaurant segment’s cost of labor increased 20 basis points from 39.1 percent of net sales in the first quarter of fiscal 2009 to 39.3 percent in the first quarter of fiscal 2010 due to deleverage from negative same-store sales and minimum wage increases, partly offset by reductions in labor hours at both restaurant concepts. In the first quarter of fiscal 2010, the Company reduced total year-over-year labor more than 858,000 hours, while achieving a higher year-over-year guest loyalty index and lowering guest complaints at both restaurant concepts. The labor-hour reduction included approximately 561,000 total hours at Bob Evans Restaurants and approximately 297,000 total hours at Mimi’s Café.

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Other operating expenses – The restaurant segment’s other operating expenses decreased 70 basis points, from 18.9 percent of net sales in the first quarter of fiscal 2009 to 18.2 percent in the first quarter of fiscal 2010. This improvement is due to lower utility, pre-opening and advertising expenses.
SG&A – The restaurant segment’s selling, general and administrative expenses increased 30 basis points, from 6.8 percent of net sales in the first quarter of fiscal 2009 to 7.1 percent in the first quarter of fiscal 2010. This increase is due primarily to deleverage from sales declines, which more than offset the favorable variance from the previously mentioned $0.7 million in expenses for a legal settlement in the first quarter of fiscal 2009.
The table below contains the first-quarter fiscal 2010 same-store sales results for Bob Evans Restaurants and Mimi’s Café.
                                                 
SAME-STORE SALES   SSS Restaurants   May   June   July   1Q FY 2010   FY 2010
Bob Evans
    560       -2.8 %     -2.5 %     -3.7 %     -3.0 %     -3.0 %
Mimi’s Café
    115       -6.9 %     -5.0 %     -7.2 %     -6.4 %     -6.4 %
COMBINED
    675       -3.9 %     -3.1 %     -4.6 %     -3.9 %     -3.9 %
First-quarter food products segment summary
Reported operating income for the food products segment was $4.8 million in the first quarter of fiscal 2010, or 6.8 percent of net sales, compared to $6.0 million, or 8.3 percent of net sales, in the first quarter of fiscal 2009. The operating income decline is due primarily to a 51 percent year-over-year increase in sow costs, which averaged $43.00 per hundredweight compared to $29.00 a year ago. This translated to a $2.2 million increase in cost of sales for the food products segment, if cost of sales as a percentage of net sales had been the same as a year ago.
Below is a line-by-line summary of the food products segment’s first-quarter fiscal 2010 income statement:
Net sales – The food products segment’s net sales were $69.7 million in the first quarter of fiscal 2010, down 3.4 percent compared to $72.1 million in the first quarter of fiscal 2009. Pounds sold of comparable products decreased 3 percent in the first quarter of fiscal 2010 compared to the first quarter of fiscal 2009, due primarily to a reduction in promotional allowances offered to retailers.
Cost of sales – The food products segment’s cost of sales increased 320 basis points, from 50.6 percent of net sales in the first quarter of fiscal 2009 to 53.8 percent in the first quarter of fiscal 2010 due to the previously mentioned increase in sow costs, partly offset by improvements in boneless meat yields.

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Operating wages – The food products segment’s cost of labor increased 30 basis points, from 12.2 percent of net sales in the first quarter of fiscal 2009 to 12.5 percent in the first quarter of fiscal 2010 due to deleverage from the decline in sales.
Other operating expenses – The food products segment’s other operating expenses decreased 10 basis points, from 5.4 percent of net sales in the first quarter of fiscal 2009 to 5.3 percent in the first quarter of fiscal 2010. This improvement is primarily due to increased plant efficiencies.
SG&A – The food products segment’s selling, general and administrative expenses decreased 230 basis points, from 20.8 percent of net sales in the first quarter of fiscal 2009 to 18.5 percent in the first quarter of fiscal 2010. The decrease reflected the benefit of converting the food products segment from a direct-store-delivery (or DSD) distribution system to a warehouse system in response to retailer needs, which more than offset deleverage from declining sales.
Fiscal year 2010 outlook
The Company reaffirmed its estimate for reported fiscal 2010 operating income of approximately $110 million to $115 million. The outlook for fiscal 2010 includes the impact of a 53 rd week, which the Company estimates will contribute an incremental $31 million in net sales and $5 million in operating income. This outlook also relies on a number of important assumptions, including same-store sales estimates and the risk factors discussed in the Company’s securities filings.
Particular assumptions include the following:
  •   Net sales – Consolidated year-over-year flat net sales. This includes:
  o   Bob Evans Restaurants – Flat net sales, with same-store sales in the negative 2.0 to 2.5 percent range. The Company does not expect to develop any new Bob Evans restaurants, but plans to rebuild two and re-image 15 existing restaurants in fiscal 2010.
 
  o   Mimi’s Café – Flat net sales, with same-store sales in the negative 4.0 to 6.0 percent range. The Company expects to open two new Mimi’s Cafes and plans to re-image 15 existing Mimi’s in fiscal 2010.
 
  o   Food products – Overall sales growth of approximately 1 to 2 percent.
  •   Restaurant operating margins – The Company expects restaurant operating margins of approximately 6.5 to 7.5 percent. Included in this estimate are the following assumptions:
  o   Cost of sales – Continued improvements due to easing commodity prices, positive mix shifts and effective supply chain management.
 
  o   Operating wages – Continued pressure from minimum wage increases, partly offset by continued labor efficiencies.
  •   Food products operating margins – The Company expects food products

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      operating margins of approximately 4.5 to 5.5 percent. Included in this estimate are average sow costs of approximately $45 to $50 per hundredweight.
 
  •   Depreciation and amortization – Approximately $85 million for the 2010 fiscal year, compared to $81.9 million in fiscal 2009.
 
  •   Net interest expense of approximately $12 million to $13 million for the 2010 fiscal year.
 
  •   An effective tax rate of approximately 33 percent for fiscal 2010.
 
  •   A diluted weighted-average share count of approximately 31 million for the 2010 fiscal year, compared to 30.7 million in fiscal 2009.
 
  •   Capital expenditures of about $60 to $65 million for the 2010 fiscal year.
The Company continues to expect substantively lower future capital expenditures for restaurant development in fiscal 2010 at both Bob Evans Restaurants and Mimi’s Café. Specifically, the Company expects to build no new Bob Evans Restaurants and two Mimi’s Cafés in fiscal 2010. The Company also reiterated that it has suspended its share repurchase program until at least the third quarter of fiscal 2010.
Company to host conference call
The Company will hold its first-quarter conference call at 10 a.m. (ET) on Wednesday, Aug. 12, 2009. The dial-in number is (800) 690-3108, access code 23687355. To access the simultaneous webcast, go to www.bobevans.com/ir . The conference call replay will be available for 48 hours, beginning two hours after the call on Aug. 12, at (800) 642-1687, access code: 23687355. The archived webcast will also be available on the Web site.
About Bob Evans Farms, Inc.
Bob Evans Farms, Inc. owns and operates full-service restaurants under the Bob Evans and Mimi’s Café brand names. At the end of the first fiscal quarter (July 24, 2009), Bob Evans owned and operated 569 family restaurants in 18 states, primarily in the Midwest, mid-Atlantic and Southeast regions of the United States, while Mimi’s Café owned and operated 144 casual restaurants located in 24 states, primarily in California and other western states. Bob Evans Farms, Inc. is also a leading producer and distributor of pork sausage and a variety of complementary homestyle convenience food items under the Bob Evans and Owens brand names. For more information about Bob Evans Farms, Inc., visit the company’s Web site at www.bobevans.com .
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Certain statements in this news release that are not historical facts are forward-looking statements. Forward-looking statements involve various important assumptions, risks and uncertainties. Actual results may differ materially from those predicted by the forward-looking statements because of various factors and possible events. We discuss these factors and events, along with certain other risks, uncertainties and assumptions, under the heading “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended April 24, 2009 and in our other filings with the Securities and Exchange Commission. We note these factors for

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investors as contemplated by the Private Securities Litigation Reform Act of 1995. Predicting or identifying all such risk factors is impossible. Consequently, investors should not consider any such list to be a complete set of all potential risks and uncertainties. Forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update any forward-looking statement to reflect circumstances or events that occur after the date on which the statement is made to reflect unanticipated events. All subsequent written and oral forward-looking statements attributable to us or any person acting on behalf of the company are qualified by the cautionary statements in this section.
Contacts:
Donald J. Radkoski
Chief Financial Officer
(614) 492-4901
David D. Poplar
Vice President of Investor Relations
(614) 492-4954

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Consolidated Financial Results (unaudited)
(Thousands, except per share data)
                 
    Three Months Ended  
    July 24, 2009     July 25, 2008  
Net Sales
               
Restaurant Segment
  $ 359,815     $ 368,143  
Food Products Segment
    69,665       72,144  
 
           
Total
  $ 429,480     $ 440,287  
 
               
Operating Income
               
Restaurant Segment
  $ 20,388     $ 17,560  
Food Products Segment
    4,751       5,960  
 
           
Total
  $ 25,139     $ 23,520  
 
               
Net Interest Expense
  $ 2,740     $ 2,885  
 
               
Income Before Income Taxes
  $ 22,399     $ 20,635  
 
               
Provisions for Income Taxes
  $ 6,284     $ 6,826  
 
               
Net Income
  $ 16,115     $ 13,809  
 
               
Earnings Per Share
               
Basic
  $ 0.52     $ 0.45  
Diluted
  $ 0.52     $ 0.45  
 
               
Average Shares Outstanding
               
Basic
    30,841       30,729  
Diluted
    30,942       30,902  

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Exhibit 99.2
Bob Evans Farms, Inc.
Earnings Release Fact Sheet (unaudited)
Fiscal 2010 – Quarter 1
Note: amounts are in thousands, except per share amounts
First quarter (Q1), ended July 24, 2009, compared to the corresponding period a year ago:
                                                                 
    Consolidated Results     Restaurant     Food Products  
    Q1     % of     Q1     % of     Q1     Q1     Q1     Q1  
    2010     sales     2009     sales     2010     2009     2010     2009  
Net sales
  $ 429,480             $ 440,287             $ 359,815     $ 368,143     $ 69,665     $ 72,144  
 
Cost of sales
    125,494       29.2 %     130,396       29.6 %     24.5 %     25.5 %     53.8 %     50.6 %
Operating wages
    150,051       34.9 %     152,705       34.7 %     39.3 %     39.1 %     12.5 %     12.2 %
Other operating
    69,451       16.2 %     73,560       16.7 %     18.2 %     18.9 %     5.3 %     5.4 %
S,G, & A
    38,362       8.9 %     40,167       9.1 %     7.1 %     6.8 %     18.5 %     20.8 %
Depr. & amort
    20,983       4.9 %     19,939       4.6 %     5.2 %     4.9 %     3.1 %     2.7 %
     
 
                                                               
Operating income
    25,139       5.9 %     23,520       5.3 %     5.7 %     4.8 %     6.8 %     8.3 %
 
                                                               
Interest
    2,740       0.7 %     2,885       0.6 %                                
                                     
 
                                                               
Pre-tax income
    22,399       5.2 %     20,635       4.7 %                                
 
                                                               
Income taxes
    6,284       1.4 %     6,826       1.6 %                                
                                     
 
                                                               
Net income
  $ 16,115       3.8 %   $ 13,809       3.1 %                                
 
                                                               
EPS — basic
  $ 0.52             $ 0.45                                          
EPS — diluted
  $ 0.52             $ 0.45                                          
 
                                                               
Dividends paid per share
  $ 0.16             $ 0.14                                          
Weighted average shares outstanding:
                                                               
 
                                                               
Basic
    30,841               30,729                                          
Dilutive stock options
    101               173                                          
 
                                                           
 
                                                               
Diluted
    30,942               30,902                                          
 
                                                               
Shares outstanding at quarter end
    30,991               30,880                                          
 
•   Income taxes, as a percentage of pre-tax income, were 28.1% vs. 33.1%
Fiscal 2010 — Quarter 1 p 1

 

 

Consolidated Q1 Review:
  •   Net sales decreased 2.5% ($429.5 million vs. $440.3 million).
 
  •   Operating income increased 6.9% ($25.1 million vs. $23.5 million).
 
  •   Pre-tax income increased 8.5% ($22.4 million vs. $20.6 million).
 
  •   Effective tax rate was 28.1% compared to 33.1%.
 
  •   Net income increased 16.7% ($16.1 million vs. $13.8 million).
 
  •   Diluted EPS was $0.52 vs. $0.45.
 
  •   The first quarter results of fiscal 2009 included the impact of the following:
  o   Consolidated and restaurant results for the first quarter of fiscal 2009 included a pre-tax charge of $0.7 million related to a legal settlement that is reflected in S,G&A.
Fiscal 2010 — Quarter 1 p 2

 

 

Restaurant Q1 Review:
•   Overall restaurant sales decreased 2.3% ($359.8 million vs. $368.1 million).
 
•   Nominal same-store sales decreased 3.0% at Bob Evans Restaurants and decreased 6.4% at Mimi’s.
 
•   Operating income increased 16.1% ($20.4 million vs. $17.6 million).
 
•   Operating margin was 5.7% compared to 4.8%.
 
•   Restaurants in operation at quarter end were: 569 Bob Evans Restaurants and 144 Mimi’s. 571 Bob Evans Restaurants and 135 Mimi’s were in operation a year ago.
 
•   Restaurant openings, by quarter:
Bob Evans Restaurants:
                                                                 
Fiscal   Beginning                                   Full           Ending
  Year   Total   Q1   Q2   Q3   Q4   Year   Closings   Total
2010
    570       0       0 e     0 e     0 e     0 e     1       569 e
2009
    571       0       0       0       1       1       2       570  
2008
    579       0       0       1       1       2       10       571  
2007
    587       4       1       3       2       10       18       579  
2006
    591       6       6       3       5       20       24       587  
Mimi’s Cafes:
                                                                 
Fiscal   Beginning                                   Full           Ending
  Year   Total   Q1   Q2   Q3   Q4   Year   Closings   Total
2010
    144       0       1 e     1 e     0 e     2 e     0       146 e
2009
    132       3       4       2       3       12       0       144  
2008
    115       1       2       8       6       17       0       132  
2007
    102       2       1       3       7       13       0       115  
2006
    92       1       2       1       6       10       0       102  
Consolidated Restaurants:
                                                                 
Fiscal   Beginning                                   Full           Ending
  Year   Total   Q1   Q2   Q3   Q4   Year   Closings   Total
2010
    714       0       1 e     1 e     0 e     2 e     1       715 e
2009
    703       3       4       2       4       13       2       714  
2008
    694       1       2       9       7       19       10       703  
2007
    689       6       2       6       9       23       18       694  
2006
    683       7       8       4       11       30       24       689  
Fiscal 2010 — Quarter 1 p 3

 

 

  •   Rebuilt restaurant openings, by quarter:
                     
Fiscal                    
Year   Q1   Q2   Q3   Q4   Full Year
2010   1      1e      0e     0e     2e
2009   1   3   0   0   4
2008   2   2   1   3   8
2007   1   1   1   1   4
2006   6   4   3   1   14
  •   Bob Evans Restaurants same-store sales analysis (24-month core; 560 restaurants):
                                                                         
    Fiscal 2010   Fiscal 2009   Fiscal 2008
    Nominal   Menu   Real   Nominal   Menu   Real   Nominal   Menu   Real
May
    (2.8 )     2.7       (5.5 )     4.4       2.8       1.6       0.9       2.0       (1.1 )
June
    (2.5 )     2.2       (4.7 )     0.9       2.9       (2.0 )     4.0       2.6       1.4  
July
    (3.7 )     2.3       (6.0 )     1.1       2.9       (1.8 )     4.4       2.6       1.8  
 
                                                                       
Q1
    (3.0 )     2.4       (5.4 )     2.0       2.9       (0.9 )     3.2       2.4       0.8  
 
                                                                       
August
                            (0.6 )     2.9       (3.5 )     4.3       2.6       1.7  
September
                            0.1       2.9       (2.8 )     0.4       2.6       (2.2 )
October
                            (0.9 )     2.9       (3.8 )     (1.9 )     1.8       (3.7 )
 
                                                                       
Q2
                            (0.5 )     2.9       (3.4 )     0.7       2.3       (1.6 )
 
                                                                       
November
                            (3.1 )     3.5       (6.6 )     2.1       2.8       (0.7 )
December
                            3.8       3.2       0.6       1.1       3.2       (2.1 )
January
                            (5.7 )     3.0       (8.7 )     1.2       2.3       (1.1 )
 
                                                                       
Q3
                            (1.3 )     3.3       (4.6 )     1.5       2.8       (1.3 )
 
                                                                       
February
                            (1.5 )     3.2       (4.7 )     3.3       2.4       0.9  
March
                            (1.9 )     3.2       (5.1 )     0.1       2.4       (2.3 )
April
                            (1.6 )     3.2       (4.8 )     1.7       2.4       (0.7 )
 
                                                                       
Q4
                            (1.6 )     3.2       (4.8 )     1.7       2.4       (0.7 )
 
                                                                       
Fiscal year
                            (0.3 )     3.1       (3.4 )     1.8       2.5       (0.7 )
Fiscal 2010 — Quarter 1 p 4

 

 

  •   Mimi’s Cafe same-store sales analysis (24-month core; 115 restaurants):
                                                                         
    Fiscal 2010   Fiscal 2009   Fiscal 2008
    Nominal   Menu   Real   Nominal   Menu   Real   Nominal   Menu   Real
May
    (6.9 )     2.4       (9.3 )     (5.0 )     2.6       (7.6 )     (0.4 )     4.0       (4.4 )
June
    (5.0 )     2.3       (7.3 )     (6.0 )     2.7       (8.7 )     (0.1 )     4.0       (4.1 )
July
    (7.2 )     2.3       (9.5 )     (8.1 )     2.7       (10.8 )     (1.5 )     3.9       (5.4 )
 
                                                                       
Q1
    (6.4 )     2.3       (8.7 )     (6.5 )     2.7       (9.2 )     (0.7 )     4.0       (4.7 )
 
                                                                       
August
                            (7.2 )     2.7       (9.9 )     (1.9 )     3.9       (5.8 )
September
                            (8.2 )     2.7       (10.9 )     (2.0 )     3.9       (5.9 )
October
                            (9.3 )     2.8       (12.1 )     (0.8 )     3.7       (4.5 )
 
                                                                       
Q2
                            (8.3 )     2.7       (11.0 )     (1.5 )     3.8       (5.3 )
 
                                                                       
November
                            (10.4 )     3.0       (13.4 )     (1.9 )     2.8       (4.7 )
December
                            (2.0 )     2.8       (4.8 )     (1.8 )     2.8       (4.6 )
January
                            (9.6 )     2.2       (11.8 )     (2.4 )     2.2       (4.6 )
 
                                                                       
Q3
                            (6.8 )     2.7       (9.5 )     (2.0 )     2.6       (4.6 )
 
                                                                       
February
                            (7.9 )     2.2       (10.1 )     (5.2 )     2.1       (7.3 )
March
                            (7.2 )     1.2       (8.4 )     (4.3 )     2.6       (6.9 )
April
                            (6.4 )     1.2       (7.6 )     (6.0 )     2.6       (8.6 )
 
                                                                       
Q4
                            (7.1 )     1.5       (8.6 )     (5.3 )     2.4       (7.7 )
 
                                                                       
Fiscal year
                            (7.2 )     2.4       (9.6 )     (2.4 )     3.2       (5.6 )
  •   Key restaurant sales data (core restaurants only):
                 
    Bob Evans    
    Restaurants   Mimi’s
Average annual store sales ($) — FY09
  $ 1,779,000     $ 3,094,000  
 
               
Q1 FY10 day part mix (%):
               
Breakfast
    32 %     21 %
Lunch
    37 %     40 %
Dinner
    31 %     39 %
 
               
Q1 FY10 check average ($)
  $ 8.14     $ 10.67  
  •   Quarterly restaurant sales by concept:
                 
    Q1 2010     Q1 2009  
Bob Evans Restaurants
  $ 257,922     $ 264,634  
Mimi’s Cafes
    101,893       103,509  
 
           
 
               
Total
  $ 359,815     $ 368,143  
Fiscal 2010 — Quarter 1 p 5

 

 

Food Products Q1 Review:
  •   Net sales decreased 3.4% ($69.7 million vs. $72.1 million).
 
  •   Comparable pounds sold decreased 3%.
 
  •   Operating income decreased 20.3% ($4.8 million vs. $6.0 million).
 
  •   Operating margin was 6.8% compared to 8.3%.
 
  •   Average sow cost increased 51% ($43.00 per cwt vs. $29.00 per cwt). Historical sow cost review (average cost per hundredweight):
                                         
Fiscal Year   Q1   Q2   Q3   Q4   Average
2010
  $ 43.00                             $ 43.00  
2009
  $ 29.00     $ 51.00     $ 49.00     $ 51.00     $ 45.00  
2008
  $ 42.00     $ 40.00     $ 31.00     $ 27.00     $ 35.00  
2007
  $ 37.00     $ 41.00     $ 39.00     $ 36.00     $ 38.00  
  •   Comparable pounds sold review:
                                         
Fiscal Year   Q1   Q2   Q3   Q4   Average
2010
    (3 %)                             (3 %)
2009
    13 %     11 %     (6 %)     3 %     6 %
2008
    4 %     2 %     8 %     5 %     5 %
2007
    13 %     11 %     4 %     5 %     8 %
  •   Net sales review (dollars in thousands):
                 
    Q1     Q1  
    2010     2009  
Gross sales
  $ 82,134     $ 88,924  
 
Less: promotions
    (11,831 )     (15,193 )
 
Less: returns and slotting
    (638 )     (1,587 )
 
           
 
Net sales
  $ 69,665     $ 72,144  
Fiscal 2010 — Quarter 1 p 6

 

 

Balance Sheet Summary:
                 
(in thousands)   Jul. 24, 2009     Apr. 24, 2009  
Cash and equivalents
  $ 21,902     $ 13,606  
Other current assets
    64,656       66,654  
Net property, plant and equipment
    997,856       1,002,692  
Goodwill and other intangible assets
    43,699       43,904  
Other non-current assets
    23,525       20,792  
 
           
Total assets
  $ 1,151,638     $ 1,147,648  
 
               
Current portion of long-term debt
  $ 26,904     $ 26,904  
Line of credit
    67,000       67,000  
Other current liabilities
    137,343       151,901  
Long-term debt
    176,192       176,192  
Other long-term liabilities
    129,459       127,945  
Stockholders’ equity
    614,740       597,706  
 
           
Total liabilities and equity
  $ 1,151,638     $ 1,147,648  
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Certain statements in this report that are not historical facts are forward-looking statements. Forward-looking statements involve various important assumptions, risks and uncertainties. Actual results may differ materially from those predicted by the forward-looking statements because of various factors and possible events. We discuss these factors and events, along with certain other risks, uncertainties and assumptions, under the heading “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended April 24, 2009, and in our other filings with the Securities and Exchange Commission. We note these factors for investors as contemplated by the Private Securities Litigation Reform Act of 1995. Predicting or identifying all such risk factors is impossible. Consequently, investors should not consider any such list to be a complete set of all potential risks and uncertainties. Forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update any forward-looking statement to reflect circumstances or events that occur after the date on which the statement is made to reflect unanticipated events. All subsequent written and oral forward-looking statements attributable to us or any person acting on behalf of the company are qualified by the cautionary statements in this section.
Fiscal 2010 — Quarter 1 p 7