BOBE: JULY KNAPP?

Bob Evans released 1QFY12 earnings results last night and printed, in the press release, the Knapp Track Casual Dining Index number for July.  This was curious because Malcolm is not releasing the June/July release until this weekend.

Bob Evans' press release, published last night, states that the July Knapp Track Casual Dining Index number is +0.9%.

We will wait for official confirmation from Malcolm (his report is set to be sent out this weekend), not least because the May Knapp Track number in the BOBE press release does not match the official Knapp Track number, but a 0.9% print would imply stable-to-slightly higher two-year average trends in the Index depending on what the final accounting period comparable restaurant sales number for June turns out to be.

As the compares become more and more difficult in the back half of the year, we expect headline numbers to come down.  Even assuming flat two-year average trends, which could be overly optimistic given the state of the consumer, the headline numbers should sequentially decline as we progress through the remainder of the year.

Howard Penney

Managing Director

Rory Green

Analyst