Panera Bread Co. on Tuesday raised its projections for the year following better-than-expected results for the first three months.

The St. Louis-based restaurant chain now projects $6.50 to $6.70 in adjusted profit a share and a 4% to 5% increase in sales at company-owned locations open for at least a year, compared with its earlier view of $6.33 to $6.52 a share and comparable sales improving 3.5% to 4.5%.

Meanwhile, for the first 27 days of the second quarter, sales at company-owned locations open for at least a year were up 4.4%.

Shares, up 15% over the past 12 months, rose 2.3% to $217.34 in after-hours trading.

The chain has increased spending -- hiring more workers and updating kitchen equipment and technology to speed service and improve order accuracy -- to reverse a sales slowdown that company officials had blamed on technology unable to cope with demand. Sales have picked up, but a toll has been taken on margins and profit over the past two years.

Panera, under pressure from investors, has moved to franchise more of its locations, targeting a 35% to 50% ownership rate, and taken on debt to buy back stock as part of its pledge to increase shareholders' returns. Last quarter, Panera said it had begun a strategic review of its money-losing Canadian operations.

Over all, for the 13 weeks ended March 29, Panera reported profit of $35.1 million, or $1.45 a share, compared with $31.9 million, or $1.20 a share, a year earlier. Excluding costs tied to store refranchising and about $3.3 million set aside in an unspecified legal matter, profit was $1.56 a share, compared with $1.41 a year earlier.

This year's results included 8.9% fewer shares outstanding.

Revenue rose 5.7% to $685.2 million as comparable sales at company-owned locations rose 6.2%.

Analysts had projected $1.50 a share in profit on $673.9 million in revenue.

Expenses, meanwhile, rose 5.2% to $628.5 million.

Write to Maria Armental at maria.armental@wsj.com