Executives of the fast-casual outfit say they do not expect thepurchase to have much overlap between franchisees in the Southwestmarkets where the two chains operate. "There's no conflict ofinterest simply because there's very little conflict," said RonaldShaich, Panera's chairman and chief executive officer, during thecompany's first-quarter earnings call.

Same-store sales during the quarter, which ended March 27, wereflat year over year, and down 1% lower than management'sexpectations due to "extreme weather." Company leadership forecastssame-store sales growth of between 3.5% and 4.5% for the comingperiod.

Panera's first-quarter sales came in at just less than $239.7million, a 24% increase from the same year-ago period. Net incomewas flat, at $15 million. Second-quarter earnings are projected togrow between 7% to 16% during the same period in 2006.