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Bob Evans earnings up in 1st-Q

COLUMBUS Ohio Bob Evans Farms Inc. reported a 3.6-percent year-to-year increase in profit for its July-ended first quarter as sales gains and cost controls helped the company buck many trends hurting the restaurant industry.

For the quarter ended July 25, Bob Evans earned $13.8 million, or 45 cents per share, compared with the year-ago quarter’s earnings of $13.3 million, or 38 cents per share.

Net sales rose 3.7 percent, to $440.3 million. Same-store sales at the Bob Evans family-dining chain rose 2 percent, aided by menu price increases of 2.9 percent, the company said.

Steve Davis, chairman and chief executive, credited favorable consumer response to the quarter’s promotions at Bob Evans, including Big Farm Salads, two new Knife and Fork sandwiches, BOB-B-Q baby-back ribs and oven-roasted chicken.

Same-store sales at the company’s casual-dining Mimi’s Cafe concept fell 6.5 percent, however. The company blamed “challenging economic conditions, sub-prime mortgage issues, lower home values and rising restaurant development costs” in states where most Mimi’s Cafes are located. The company warned that those conditions could negatively impact future development plans.

Currently, there are 571 Bob Evans restaurants in 18 states, mostly in the Midwest, Mid-Atlanta and Southeast, and 135 Mimi’s Cafes in 22 states, concentrated in the West.

Latest-quarter profit was aided by a 12-percent gain in sales and a 75-perent increase in operating income at the retail food products division. The improvements were helped by lower hog costs, the company said. At its restaurants, Bob Evans said it was able to reduce cost of sales and labor expenses through new purchasing and labor-management programs.

After the close of the quarter, the company closed a private placement of $70 million in senior unsecured fixed-rate notes to replace existing debt.

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