Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 30, 2023 | Feb. 20, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 30, 2023 | ||
Current Fiscal Year End Date | --12-30 | ||
Document Transition Report | false | ||
Entity File Number | 001-37425 | ||
Entity Registrant Name | WINGSTOP INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 47-3494862 | ||
Entity Address, Address Line One | 15505 Wright Brothers Drive | ||
Entity Address, City or Town | Addison | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 75001 | ||
City Area Code | 972 | ||
Local Phone Number | 686-6500 | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Trading Symbol | WING | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 6 | ||
Entity Common Stock, Shares Outstanding | 29,337,920 | ||
Documents Incorporated by Reference | Portions of the proxy statement for the registrant's 2024 annual meeting of stockholders, which will be filed no later than 120 days after the end of the registrant’s fiscal year ended December 30, 2023, are incorporated by reference into Part III of this report. | ||
Entity Central Index Key | 0001636222 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 30, 2023 | |
Audit Information [Abstract] | |
Auditor Firm ID | 185 |
Auditor Name | KPMG LLP |
Auditor Location | Dallas, Texas |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 90,216 | $ 184,496 |
Restricted cash | 11,444 | 13,296 |
Accounts receivable, net | 12,408 | 9,461 |
Prepaid expenses and other current assets | 4,948 | 4,252 |
Advertising fund assets, restricted | 25,328 | 15,167 |
Total current assets | 144,344 | 226,672 |
Property and equipment, net | 91,292 | 66,851 |
Goodwill | 67,708 | 62,514 |
Trademarks | 32,700 | 32,700 |
Other non-current assets | 34,041 | 26,438 |
Total assets | 377,825 | 424,190 |
Current liabilities | ||
Accounts payable | 4,725 | 5,219 |
Other current liabilities | 40,951 | 34,726 |
Current portion of debt | 0 | 7,300 |
Advertising fund liabilities | 25,328 | 15,167 |
Total current liabilities | 71,004 | 62,412 |
Long-term debt, net | 712,327 | 706,846 |
Deferred revenues, net of current | 30,145 | 27,052 |
Deferred income tax liabilities, net | 3,721 | 4,180 |
Other non-current liabilities | 17,994 | 14,561 |
Total liabilities | 835,191 | 815,051 |
Commitments and contingencies (see Note 13) | ||
Stockholders' deficit | ||
Common stock, $0.01 par value; 100,000,000 shares authorized; 29,337,920 and 29,932,668 shares issued and outstanding as of December 30, 2023 and December 31, 2022, respectively | 293 | 300 |
Additional paid-in-capital | 2,676 | 2,797 |
Retained deficit | (459,994) | (393,321) |
Accumulated other comprehensive loss | (341) | (637) |
Total stockholders' deficit | (457,366) | (390,861) |
Total liabilities and stockholders' deficit | 377,825 | 424,190 |
Customer relationships | ||
Current assets | ||
Customer relationships, net | $ 7,740 | $ 9,015 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 29,337,920 | 29,932,668 |
Common stock, shares outstanding (in shares) | 29,337,920 | 29,932,668 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | ||
Revenue: | ||||
Total revenue | $ 460,055 | $ 357,521 | $ 282,502 | |
Costs and expenses: | ||||
Cost of sales | [1] | 70,646 | 63,395 | 57,416 |
Advertising expenses | 166,583 | 123,069 | 83,989 | |
Selling, general and administrative | 96,898 | 67,061 | 62,895 | |
Depreciation and amortization | 13,239 | 10,899 | 7,943 | |
Loss on disposal of assets | 95 | 1,164 | (3,497) | |
Total costs and expenses | 347,461 | 265,588 | 208,746 | |
Operating income | 112,594 | 91,933 | 73,756 | |
Interest expense, net | 18,227 | 21,230 | 14,984 | |
Loss on debt extinguishment and financing transactions | 0 | 814 | 0 | |
Other (income) expense | 57 | 573 | (135) | |
Income before income tax expense | 94,310 | 69,316 | 58,907 | |
Income tax expense | 24,135 | 16,369 | 16,249 | |
Net income | $ 70,175 | $ 52,947 | $ 42,658 | |
Earnings per share | ||||
Basic (in usd per share) | $ 2.36 | $ 1.77 | $ 1.43 | |
Diluted (in usd per share) | $ 2.35 | $ 1.77 | $ 1.42 | |
Weighted average shares outstanding | ||||
Basic (in shares) | 29,769 | 29,893 | 29,769 | |
Diluted (in shares) | 29,856 | 29,963 | 29,944 | |
Dividends per share (in USD per share) | $ 0.82 | $ 4.72 | $ 0.62 | |
Other comprehensive income (loss) | ||||
Currency translation adjustment | $ 296 | $ (381) | $ (256) | |
Other comprehensive income (loss) | 296 | (381) | (256) | |
Comprehensive income | 70,471 | 52,566 | 42,402 | |
Royalty revenue, franchise fees and other | ||||
Revenue: | ||||
Total revenue | 207,077 | 158,614 | 130,676 | |
Advertising fees | ||||
Revenue: | ||||
Total revenue | 157,138 | 119,011 | 81,529 | |
Company-owned restaurant sales | ||||
Revenue: | ||||
Total revenue | $ 95,840 | $ 79,896 | $ 70,297 | |
[1]Cost of sales includes all operating expenses of company-owned restaurants, including advertising expenses, and excludes depreciation and amortization, which are presented separately. |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Deficit - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Deficit | Accumulated Other Comprehensive Loss |
Balance at beginning of period (in shares) at Dec. 26, 2020 | 29,687,123 | ||||
Balance at beginning of period at Dec. 26, 2020 | $ (341,310) | $ 297 | $ 421 | $ (342,028) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 42,658 | 42,658 | |||
Shares issued under stock plans (in shares) | 161,873 | ||||
Shares issued under stock plans | 748 | $ 2 | 746 | ||
Tax payments for restricted stock upon vesting (in shares) | (11,542) | ||||
Tax payments for restricted stock upon vesting | (1,915) | (1,915) | |||
Stock-based compensation expense | 9,631 | 9,631 | |||
Dividends declared on common stock and equivalents | (19,081) | (10,335) | (8,746) | ||
Currency translation adjustment | (256) | (256) | |||
Balance at end of period (in shares) at Dec. 25, 2021 | 29,837,454 | ||||
Balance at end of period at Dec. 25, 2021 | (309,525) | $ 299 | 463 | (310,031) | (256) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 52,947 | 52,947 | |||
Shares issued under stock plans (in shares) | 97,281 | ||||
Shares issued under stock plans | 3,315 | $ 1 | 3,314 | ||
Tax payments for restricted stock upon vesting (in shares) | (2,067) | ||||
Tax payments for restricted stock upon vesting | (315) | (315) | |||
Stock-based compensation expense | 4,200 | 4,200 | |||
Dividends declared on common stock and equivalents | (141,102) | (5,180) | (135,922) | ||
Currency translation adjustment | $ (381) | (381) | |||
Balance at end of period (in shares) at Dec. 31, 2022 | 29,932,668 | 29,932,668 | |||
Balance at end of period at Dec. 31, 2022 | $ (390,861) | $ 300 | 2,797 | (393,321) | (637) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 70,175 | 70,175 | |||
Shares issued under stock plans (in shares) | 65,779 | ||||
Shares issued under stock plans | 951 | 951 | |||
Tax payments for restricted stock upon vesting (in shares) | (14,575) | ||||
Tax payments for restricted stock upon vesting | (2,480) | (2,480) | |||
Stock-based compensation expense | 15,558 | 15,558 | |||
Dividends declared on common stock and equivalents | $ (24,729) | (16,239) | (8,490) | ||
Purchases of common stock (in shares) | (645,952) | ||||
Purchases of common stock | $ (126,276) | $ (7) | (391) | (125,878) | |
Currency translation adjustment | $ 296 | 296 | |||
Balance at end of period (in shares) at Dec. 30, 2023 | 29,337,920 | 29,337,920 | |||
Balance at end of period at Dec. 30, 2023 | $ (457,366) | $ 293 | $ 2,676 | $ (459,994) | $ (341) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Operating activities | |||
Net income | $ 70,175 | $ 52,947 | $ 42,658 |
Adjustments to reconcile net income to cash provided by operating activities: | |||
Depreciation and amortization | 13,239 | 10,899 | 7,943 |
Deferred income taxes | (1,551) | (3,252) | 2,953 |
Stock-based compensation expense | 15,558 | 4,200 | 9,631 |
Loss (gain) on disposal of assets | 95 | 1,164 | (3,497) |
Loss on debt extinguishment | 0 | 814 | 0 |
Amortization of debt issuance costs | 2,043 | 1,939 | 1,401 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (2,947) | (2,468) | (2,135) |
Prepaid expenses and other assets | 599 | 584 | (2,659) |
Advertising fund assets and liabilities, net | 10,093 | 5,048 | (10,723) |
Accounts payable and other current liabilities | 10,634 | 5,102 | (268) |
Deferred revenue | 3,593 | (712) | 3,386 |
Other non-current liabilities | 70 | (27) | 188 |
Cash provided by operating activities | 121,601 | 76,238 | 48,878 |
Investing activities | |||
Purchases of property and equipment | (40,833) | (23,940) | (28,021) |
Acquisitions of restaurants from franchisees | (10,832) | (7,809) | (4,876) |
Proceeds from sales of assets | 320 | 4,063 | 7,207 |
Payments for investments | (808) | (997) | (4,163) |
Cash used in investing activities | (52,153) | (28,683) | (29,853) |
Financing activities | |||
Proceeds from exercise of stock options | 951 | 3,315 | 748 |
Purchases of common stock | (125,401) | 0 | 0 |
Borrowings of long-term debt | 0 | 250,000 | 0 |
Repayments of long-term debt | (3,650) | (3,025) | (2,400) |
Payment of deferred financing costs and other debt-related costs | 0 | (5,442) | 0 |
Tax payments for restricted stock upon vesting | (2,480) | (315) | (1,915) |
Dividends paid | (24,907) | (141,279) | (19,822) |
Cash provided by (used in) financing activities | (155,487) | 103,254 | (23,389) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (86,039) | 150,809 | (4,364) |
Cash, cash equivalents, and restricted cash at beginning of period | 205,715 | 54,906 | 59,270 |
Cash, cash equivalents, and restricted cash at end of period | 119,676 | 205,715 | 54,906 |
Supplemental information: | |||
Accrued capital expenditures | 2,963 | 7,273 | 5,074 |
Cash paid for interest | 22,740 | 20,480 | 15,035 |
Cash paid for taxes | $ 27,918 | $ 13,584 | $ 10,423 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | (1) Basis of Presentation and Summary of Significant Accounting Policies Overview Wingstop Inc., together with its consolidated subsidiaries (collectively, “Wingstop” or the “Company”), is in the business of franchising and operating Wingstop restaurants. As of December 30, 2023, the Company had a total of 2,214 restaurants in its system. The Company's restaurant base is 98% franchised, with 2,165 franchised restaurants (including 288 international restaurants) and 49 company-owned restaurants as of December 30, 2023. The Company operates as a single segment for reporting purposes. Summary of Significant Accounting Policies (a) Principles of Consolidation The accompanying consolidated financial statements include the accounts of Wingstop Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. (b) Fiscal Year End The Company uses a 52/53-week fiscal year that ends on the last Saturday of the calendar year. Fiscal years 2023, 2022, and 2021 included 52, 53, and 52 weeks, respectively. The 53 rd week in fiscal 2022 fell in the fourth fiscal quarter. (c) Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions, primarily related to long-lived asset valuation, indefinite and finite lived intangible asset valuation, income taxes, investments, leases, stock-based compensation, contingencies, and common stock equity valuations. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the period. Although management bases its estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, actual results could differ from those estimates. (d) Cash, Cash Equivalents, and Restricted Cash The Company continually monitors its positions with, and the credit quality of, the financial institutions in which it maintains its deposits and investments. As of December 30, 2023 and December 31, 2022, the Company maintained balances in various cash accounts in excess of federally insured limits. All highly liquid instruments purchased with an original maturity of three months or less are considered cash equivalents. Restricted cash includes cash and cash equivalents held for future principal and interest payments as required by the Company's debt agreements (see Note 11). The Company also has Advertising fund restricted cash, which can only be used for activities related to the promotion of the Wingstop brand. Cash, cash equivalents, and restricted cash within the Consolidated Balance Sheets that are included in the Consolidated Statements of Cash Flows as of December 30, 2023 and December 31, 2022 were as follows (in thousands): December 30, 2023 December 31, 2022 Cash and cash equivalents $ 90,216 $ 184,496 Restricted cash 11,444 13,296 Restricted cash, included in Advertising fund assets, restricted 18,016 7,923 Total cash, cash equivalents, and restricted cash $ 119,676 $ 205,715 (e) Accounts Receivable Accounts receivable, net of allowance for doubtful accounts, consists primarily of accrued royalty fee receivables, collected weekly in arrears, and vendor rebates. Management determines the allowance for doubtful accounts based on historical losses and current economic conditions. On a continuing basis, management analyzes delinquent receivables, which are charged off against the existing allowance account when determined to be uncollectible. (f) Inventories Inventories, which consist of food and beverage products, paper goods, and supplies, are valued at the lower of cost (first-in, first-out) or net realizable value. (g) Property and Equipment Property and equipment is recorded at cost less accumulated depreciation. Property and equipment is depreciated based on the straight-line method over the following estimated useful lives: Property and Equipment Estimated Useful Lives Building 40 years Leasehold and other improvements Lesser of 7 to 10 years or the expected lease term Equipment, furniture and fixtures 3 to 7 years Computer software 3 years At the time property and equipment are retired, the asset and accumulated depreciation are removed from the accounts, and any resulting gain or loss is included in earnings. The Company expenses repair and maintenance costs that maintain the appearance and functionality of the restaurant but do not extend the useful life of any restaurant asset. Improvements to leased properties are depreciated over the shorter of their useful life or the lease term, which includes a fixed, non-cancelable lease term plus any reasonably assured renewal periods. See Note 6 for additional information. (h) Impairment or Disposal of Long-Lived Assets Property and equipment and finite-life intangible assets are reviewed for impairment periodically and whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. The Company’s assessment of recoverability of property and equipment and finite-lived intangible assets is performed at the component level, which is generally an individual restaurant and requires judgment and an estimate of future restaurant generated cash flows. The Company’s estimates of fair values are based on the best information available and require the use of estimates, judgments, and projections. The Company did not record any impairment losses on long-lived assets in fiscal years 2023, 2022, or 2021. (i) Goodwill and Indefinite-Lived Intangible Assets The Company’s indefinite-lived intangible assets consist of goodwill and trademarks, which are not subject to amortization. We generally record goodwill in connection with the acquisition of restaurants from franchisees. On an annual basis (October 1 st of each fiscal year) and whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable, the Company reviews the recoverability of goodwill and indefinite-lived intangible assets. No indications of impairment were identified during fiscal years 2023, 2022, or 2021. It is possible that changes in circumstances or changes in management’s judgments, assumptions, and estimates could result in an impairment charge of a portion or all of its goodwill or other intangible assets. (j) Foreign Currency Translation The foreign currency translation adjustment included in the Consolidated Statements of Comprehensive Income represents the unrealized impact of translating our foreign investment. This amount is not included in Net income and would only be realized upon disposition of our investment. The related Accumulated other comprehensive loss is presented in the Consolidated Balance Sheets. (k) Revenue Recognition Revenues consist primarily of royalties, national advertising fund (the "Ad Fund") contributions (advertising fees), initial and renewal franchise fees, and upfront fees from development agreements and international territory agreements. The Company's performance obligations under its franchise agreements consist of (a) a franchise license, (b) pre-opening services, such as training, and (c) ongoing services, such as management of the Ad Fund contributions, development of training materials and menu items, and restaurant monitoring. These performance obligations are highly interrelated, so they are not considered to be individually distinct and therefore are accounted for as a single performance obligation, which is satisfied by providing a right to use the Company's intellectual property over the term of each franchise agreement. Franchise fee, development fee and international territory fee payments received by the Company before the restaurant opens are recorded as deferred revenue in the Consolidated Balance Sheets. Royalties, including franchisee contributions to the Ad Fund, are calculated as a percentage of franchise restaurant sales over the term of the franchise agreement. Initial and renewal franchise fees are payable by the franchisee prior to the restaurant opening or at the time of a renewal of an existing franchise agreement. The Company's franchise agreement royalties, inclusive of Ad Fund contributions, represent sales-based royalties that are related entirely to the Company's performance obligation under the franchise agreement and are recognized as franchised restaurant sales occur, payable weekly. Additionally, initial and renewal franchise fees are recognized as revenue on a straight-line basis over the term of the respective agreement. The Company's performance obligation under development agreements and international territory agreements generally consists of an obligation to grant exclusive development rights over a stated term. These development rights are not distinct from franchise agreements, so upfront fees paid by franchisees for development rights are apportioned to each franchised restaurant opened and accounted for as an initial franchise fee. The Company records food and beverage revenues from company-owned restaurants upon sale to the customer. The Company collects and remits sales, food and beverage, alcoholic beverage, and hospitality taxes on transactions with customers and reports such amounts under the net method in its Consolidated Statements of Comprehensive Income. Accordingly, these taxes are not included in gross revenue. The Company records a liability in the period in which a gift card is sold. As gift cards are redeemed, the liability is reduced. When gift cards are redeemed at a franchisee-operated restaurant, the revenue and related administrative costs are recognized by the franchisee. The Company recognizes revenue and related administrative costs when gift cards are redeemed at company-owned restaurants. (l) Consideration from Vendors The Company has entered into food and beverage supply agreements with certain major vendors. Pursuant to the terms of these arrangements, rebates are provided to the Company from the vendors based upon the dollar volume of purchases for company-owned restaurants and franchised restaurants. These incentives are recognized as earned throughout the year and are classified as a reduction in Cost of sales with any consideration received in excess of the total expense of the vendor’s products included within Royalty revenue, franchise fees and other within the Consolidated Statements of Comprehensive Income. The incentives recognized were approximately $17.7 million, $13.1 million, and $8.7 million, during fiscal years 2023, 2022, and 2021, respectively, of which $2.3 million, $1.8 million, and $1.6 million was classified as a reduction in Cost of sales during fiscal years 2023, 2022, and 2021, respectively. (m) Advertising Expenses The Company administers the Ad Fund, for which a percentage of gross sales is collected from domestic restaurant franchisees and company-owned restaurants to be used for various forms of advertising for the Wingstop brand. Effective the first day of the fiscal second quarter of 2022, domestic franchisees’ contribution rates to the national advertising fund increased to 5%, up from 4%, of gross sales. The national advertising fund contribution rate was 4% for fiscal year 2021. The Company administers and directs the development of all advertising and promotion programs in the Ad Fund for which it collects advertising contributions in accordance with the provisions of its franchise agreements. The Company has a contractual obligation with regard to these advertising contributions. The Company consolidates and reports all assets and liabilities of the Ad Fund as restricted assets of the Ad Fund and liabilities of the Ad Fund within current assets and current liabilities, respectively, in the Consolidated Balance Sheets. The assets and liabilities of the Ad Fund consist primarily of cash, receivables, accrued expenses, and other liabilities. Pursuant to the Company’s franchise agreements, use of Ad Fund contributions is restricted to advertising, public relations, merchandising, similar activities, and administrative expenses to increase sales and further enhance the public reputation of the Wingstop brand. The aforementioned administrative expenses may also include personnel expenses and allocated costs incurred by the Company that are directly associated with administering the Ad Fund, as outlined in the provisions of the applicable franchise agreements. The Company expenses the production costs of advertising in the period in which the advertising first occurs. All other advertising and promotional costs are expensed in the period incurred. When contributions to the Ad Fund exceed the related advertising expenses, advertising costs are accrued up to the amount of the related contributions. Ad Fund contributions and expenditures are reported on a gross basis on the Consolidated Statements of Comprehensive Income. Advertising expenses incurred by company-owned restaurants are included within Cost of sales in the Consolidated Statements of Comprehensive Income. Company-owned restaurants incurred advertising expenses of $4.9 million, $3.6 million, and $3.3 million in fiscal years 2023, 2022, and 2021, respectively. (n) Leases The Company determines whether an arrangement is a lease at inception and leases restaurants and office space under operating leases. Most lease agreements contain tenant improvement allowances, rent holidays, rent escalation clauses, and/or contingent rent provisions. For leases with renewal periods at the Company’s option, the Company determines the expected lease period based on whether the renewal of any options are reasonably certain at the inception of the lease. For purposes of measurement and amortization of the right-of-use asset and associated lease liability over the terms of the leases, the Company uses the date it takes possession of the leased space for construction purposes at the beginning of the lease term, which is generally two (o) Stock-Based Compensation The Company measures stock-based compensation cost at fair value on the date of grant for all share-based awards and recognizes compensation expense over the service period that the awards are expected to vest. The Company has elected to recognize compensation cost for graded-vesting awards subject only to a service condition over the requisite service period of the entire award. For performance awards, the Company recognizes expense in the period in which vesting becomes probable. The Company accounts for forfeitures as they occur. (p) Income Taxes Income taxes are accounted for under the asset and liability method. Under this method, a deferred tax asset or liability is recognized for the estimated future tax effects attributable to temporary differences between the financial statement basis and the tax basis of assets and liabilities as well as tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period of the change. The Company files a consolidated federal income tax return including all of its wholly-owned subsidiaries. Judgment is required in evaluating the Company’s uncertain tax positions and determining the Company’s income tax expense. The Company assesses the income tax position and records the liabilities for all years subject to examination based upon management’s evaluation of the facts, circumstances, and information available at the reporting date. (q) Recent Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standard Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure . The ASU updates reportable segment disclosure requirements, primarily through requiring enhanced disclosures about significant segment expenses and information used to assess segment performance. The ASU is effective for fiscal years beginning after December 15, 2023, with early adoption permitted. We are currently evaluating the impact of adopting this ASU on our disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . The ASU includes amendments requiring enhanced income tax disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and can be applied either prospectively or retrospectively. We are currently evaluating the impact of adopting this ASU on our disclosures. We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our consolidated financial statements. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 30, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | (2) Earnings Per Share Basic earnings per share is computed by dividing income available to common stockholders by the weighted average number of shares of common stock outstanding for the reporting period. Diluted earnings per share reflects the potential dilution that could occur if securities convertible into, or other contracts to issue, common stock were exercised or converted into common stock. For the calculation of diluted earnings per share, the basic weighted average number of shares is increased by the dilutive effect of the exercise and vesting of stock options and service-based and performance-based restricted stock units, respectively, determined using the treasury stock method. Basic weighted average shares outstanding is reconciled to diluted weighted average shares outstanding as follows (in thousands): Fiscal Year December 30, December 31, December 25, Basic weighted average shares outstanding 29,769 29,893 29,769 Dilutive shares 87 70 175 Diluted weighted average shares outstanding 29,856 29,963 29,944 We had approximately 0, 19,000, and 3,000 equity awards outstanding at December 30, 2023, December 31, 2022, and December 25, 2021, respectively, that were excluded from the dilutive earnings per share calculation because the effect would have been anti-dilutive. |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Dec. 30, 2023 | |
Dividends [Abstract] | |
Stockholders’ Deficit | (3) Stockholders’ Deficit Dividends In connection with the Company's regular dividend program, the Company declared and paid dividends of $24.4 million, or $0.82 per common share, in fiscal year 2023, $21.5 million, or $0.72 per common share, in fiscal year 2022, and $18.5 million, or $0.62 per common share, in fiscal year 2021. Subsequent to the end of fiscal year 2023, on February 20, 2024, the Company’s board of directors declared a quarterly dividend of $0.22 per share of common stock, to be paid on March 29, 2024 to stockholders of record as of March 8, 2024, totaling approximately $6.5 million. Separate from the Company's regular dividend program, the Company declared and paid special dividends of $119.5 million, or $4.00 per share of common stock, in fiscal year 2022. No special dividends were declared or paid during fiscal years 2023 and 2021. Share Repurchase Program On August 16, 2023, the Company’s Board of Directors approved a new share repurchase program with authorization to purchase up to $250.0 million of its outstanding shares of common stock (the “Share Repurchase Authorization”). |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | (4) Fair Value Measurements Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. Assets and liabilities are classified using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value as follows: Level 1 - Unadjusted quoted prices for identical instruments traded in active markets. Level 2 - Observable market-based inputs or unobservable inputs corroborated by market data. Level 3 - Unobservable inputs reflecting management’s estimates and assumptions. The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to their short-term nature. Fair value of debt is determined on a non-recurring basis, which results are summarized as follows (in thousands): Fair Value Hierarchy December 30, 2023 December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value Securitized Financing Facility: 2020-1 Class A-2 Senior Secured Notes (1) Level 2 $ 472,800 $ 423,823 $ 475,200 $ 406,462 2022-1 Class A-2 Senior Secured Notes (1) Level 2 $ 248,125 $ 222,370 $ 249,375 $ 215,709 Investments in bonds of LPH (Note 10) (2) Level 3 $ 3,557 $ 4,306 $ 3,196 $ 3,906 (1) The fair value of the 2020-1 and 2022-1 Class A-2 Senior Secured Notes was estimated using available market information. (2) The fair value approximates discounted cash flows using current market rates for debt investments with similar maturities and credit risk. |
Accounts Receivable, net
Accounts Receivable, net | 12 Months Ended |
Dec. 30, 2023 | |
Receivables [Abstract] | |
Accounts Receivable, net | (5) Accounts Receivable, net Accounts receivable, net, consist of the following (in thousands): December 30, December 31, Vendor rebates receivable $ 5,311 $ 3,610 Royalties receivable 5,717 3,811 Other receivables, net 1,380 2,040 Accounts receivable, net $ 12,408 $ 9,461 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | (6) Property and Equipment Property and equipment, net, consisted of the following (in thousands): December 30, December 31, Building 15,769 15,769 Construction in progress 46,675 23,008 Equipment, furniture and fixtures 41,268 33,406 Leasehold and other improvements 26,599 23,295 Land 2,828 2,828 Property and equipment, gross 133,139 98,306 Less: accumulated depreciation (41,847) (31,455) Property and equipment, net $ 91,292 $ 66,851 Depreciation expense was $10.6 million, $8.7 million, and $5.6 million for the fiscal years ended December 30, 2023, December 31, 2022, and December 25, 2021, respectively. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Dec. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | (7) Intangible Assets and Goodwill The Company’s goodwill and other intangible assets arose from Wingstop’s acquisition of the equity interests of Wingstop Holdings, Inc. in April 2010, as well as the acquisition of restaurants from franchisees. Goodwill represents the excess of purchase consideration transferred for the respective reporting unit over the fair value of the business at the time of the acquisition. The following is a summary of goodwill balances and activity (in thousands): December 30, December 31, Balance, beginning of period $ 62,514 $ 56,877 Acquisition of restaurants, net 5,194 5,637 Balance, end of period $ 67,708 $ 62,514 Intangible assets, excluding goodwill, consisted of the following (in thousands): December 30, December 31, Weighted Average Amortization Period (in years) Intangible assets: Trademarks $ 32,700 $ 32,700 Indefinite-lived assets 32,700 32,700 Customer relationships 26,300 26,300 20.0 Franchise rights (1) 14,168 9,038 6.2 Less: accumulated amortization (24,488) (21,931) Definite-lived assets 15,980 13,407 16.7 Intangible assets, net $ 48,680 $ 46,107 (1) Included within Other non-current assets net of associated accumulated amortization within the Consolidated Balance Sheets. Amortization expense for definite-lived intangibles was $2.7 million in fiscal year 2023, $2.2 million in fiscal year 2022, and $2.3 million in fiscal year 2021. Estimated amortization expense, for the five succeeding fiscal years and the aggregate thereafter is (in thousands): Fiscal year 2024 $ 2,898 Fiscal year 2025 2,711 Fiscal year 2026 2,504 Fiscal year 2027 2,366 Fiscal year 2028 2,177 Thereafter 3,324 Total $ 15,980 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets and Other Current Liabilities | 12 Months Ended |
Dec. 30, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
Prepaid Expenses and Other Current Assets and Other Current Liabilities | (8) Prepaid Expenses and Other Current Assets and Other Current Liabilities Prepaid expenses and other current assets consisted of the following (in thousands): December 30, December 31, Prepaid expenses $ 3,567 $ 2,735 Inventories 535 389 Other current assets 846 1,128 Total $ 4,948 $ 4,252 Other current liabilities consisted of the following (in thousands): December 30, December 31, Accrued payroll and incentive compensation $ 14,331 $ 8,733 Current portion of deferred revenues 4,846 4,476 Taxes payable 2,948 6,401 Short term lease liability 2,380 2,283 Accrued interest 1,702 1,711 Gift card liability 1,926 1,565 Other accrued liabilities 12,818 9,557 Total $ 40,951 $ 34,726 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (9) Income Taxes Income tax expense for the fiscal years 2023, 2022, and 2021 consisted of the following (in thousands): Fiscal Year December 30, December 31, December 25, Current expense Federal $ 19,398 $ 15,909 $ 10,432 State 4,586 3,384 2,601 Foreign 610 328 263 Deferred expense (benefit) Federal (314) (2,996) 2,994 State (145) (256) (41) Income tax expense $ 24,135 $ 16,369 $ 16,249 A reconciliation of income tax at the U.S. federal statutory tax rate (using a statutory tax rate of 21%) to income tax expense for fiscal years 2023, 2022, and 2021 in dollars is as follows (in thousands): Fiscal Year December 30, December 31, December 25, Expected income tax expense at statutory rate $ 19,777 $ 14,556 $ 12,370 Excess tax benefits from equity compensation (1,275) (522) (591) Non-deductible expenses 3,106 935 1,880 State tax expense, net of federal benefit 3,164 2,090 2,091 Foreign tax expense 610 328 263 Foreign tax and other tax credits (1,760) (1,001) (385) Increase in unrecognized tax benefit 398 337 296 Other 115 (354) 325 Income tax expense $ 24,135 $ 16,369 $ 16,249 The components of deferred tax assets (liabilities) were as follows (in thousands): December 30, 2023 December 31, 2022 Deferred tax assets: Deferred revenue $ 6,067 $ 6,352 Accrued incentive compensation 1,596 891 Stock based compensation 1,444 1,345 Lease liabilities 4,720 3,863 Intangible assets 196 76 Other 1,365 2,493 Net operating loss carry-forwards and credits 827 1,061 Valuation allowance (577) (577) 15,638 15,504 Deferred tax liabilities: Intangible assets (10,397) (10,397) Right of use assets (4,464) (3,628) Property and equipment (4,498) (5,659) (19,359) (19,684) Net deferred tax liability $ (3,721) $ (4,180) The Company had a state net operating loss carry-forward of $23.3 million at December 30, 2023 and December 31, 2022. The state net operating loss carry forwards begin to expire in 2030. The Company had a valuation allowance of $0.6 million against its deferred tax assets as of December 30, 2023 and December 31, 2022. In assessing whether a deferred tax asset will be realized, the Company considers whether it is more likely than not that either some portion or all of the deferred tax assets will not be realized. The Company considers the reversal of existing taxable temporary differences, projected future taxable income and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, the Company believes it is more likely than not that it will realize a portion of the benefits of the federal and state deductible differences. The Company files income tax returns, which are periodically audited by various federal and state jurisdictions. The Company's income tax returns prior to tax year 2018 are generally considered closed to examination by the applicable tax authorities. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Balance as of December 26, 2020 $ 794 Additions for tax positions of prior years — Subtractions for tax positions of prior years (34) Additions for tax positions of current year 295 Subtractions for tax positions of current year — Balance as of December 25, 2021 1,055 Additions for tax positions of prior years — Subtractions for tax positions of prior years (27) Additions for tax positions of current year 270 Subtractions for tax positions of current year — Balance as of December 31, 2022 1,298 Additions for tax positions of prior years — Subtractions for tax positions of prior years (65) Additions for tax positions of current year 468 Subtractions for tax positions of current year — Balance as of December 30, 2023 $ 1,701 As of December 30, 2023 and December 31, 2022, the accrued interest and penalties on the unrecognized tax benefits were $0.7 million and $0.5 million, respectively, excluding any related income tax benefits. The Company recorded accrued interest related to the unrecognized tax benefits and penalties as a component of the provision for income taxes recognized in the Consolidated Statement of Comprehensive Income. |
Investments
Investments | 12 Months Ended |
Dec. 30, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments | (10) Investments In the second quarter of 2021, a wholly-owned subsidiary of the Company acquired a 20% non-controlling interest in Wingstop’s United Kingdom master franchisee, Lemon Pepper Holdings Ltd. (“LPH”), for an aggregate amount of $4.2 million. Substantially all of the investment consisted of bonds issued by a subsidiary of LPH, which are recorded on an amortized cost basis. In addition, the Company received 20% of the |
Debt Obligations
Debt Obligations | 12 Months Ended |
Dec. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt Obligations | (11) Debt Obligations Long-term debt consisted of the following components (in thousands): December 30, 2023 December 31, 2022 2020-1 Class A-2 Senior Secured Notes $ 472,800 475,200 2022-1 Class A-2 Senior Secured Notes 248,125 249,375 Debt issuance costs, net of amortization (8,598) (10,429) Less: current portion of debt — (7,300) Long-term debt, net $ 712,327 $ 706,846 As of December 30, 2023, the scheduled principal payments on debt were as follows (in thousands): Fiscal year 2024 $ — Fiscal year 2025 — Fiscal year 2026 — Fiscal year 2027 472,800 Fiscal year 2028 — Thereafter 248,125 Total $ 720,925 Securitized Financing Facility On March 9, 2022, the Company completed a securitized financing transaction, in which Wingstop Funding LLC, a limited purpose, bankruptcy-remote, indirect wholly owned subsidiary of the Company (the “Issuer”), issued $250 million of its Series 2022-1 3.734% Fixed Rate Senior Secured Notes, Class A-2 (the “2022 Class A-2 Notes”). The Issuer also entered into a revolving financing facility of Series 2022-1 Variable Funding Senior Notes, Class A-1 (the “2022 Variable Funding Notes,” and together with the 2022 Class A-2 Notes, the “2022 Notes”), which permits borrowings of up to a maximum principal amount of $200 million, subject to certain borrowing conditions, a portion of which may be used to issue letters of credit. The proceeds from the securitized financing transaction were used to pay related transaction fees and expenses, strengthen the Company's liquidity position and for general corporate purposes, which included a return of capital to the Company’s stockholders. In addition to the 2022 Notes, the Company’s outstanding debt consists of its existing Series 2020-1 2.84% Fixed Rate Senior Secured Notes, Class A-2 (the “2020 Notes”), which have an anticipated repayment date of December 2027. The Company’s existing revolving financing facility of Series 2020-1 Class A-1 Notes was terminated in connection with the 2022 issuance. No borrowings were outstanding under the 2022 Variable Funding Notes as of December 30, 2023. The 2022 Notes were issued in a securitization transaction, which is guaranteed by certain limited-purpose, bankruptcy-remote, wholly owned indirect subsidiaries of the Company and secured by a security interest in substantially all of their assets, including certain domestic and foreign revenue-generating assets, consisting principally of franchise-related agreements, intellectual property, and vendor rebate contracts. The 2022 Notes were issued pursuant to a base indenture and related supplemental indentures (collectively, the “Indenture”). Interest and principal payments on the 2022 Class A-2 Notes are payable on a quarterly basis. The requirement to make such quarterly principal payments on the 2022 Class A-2 Notes is subject to certain financial conditions set forth in the Indenture. The legal final maturity date of the 2022 Notes is in March of 2052, but, unless earlier prepaid to the extent permitted under the Indenture, the anticipated repayment date of the 2022 Class A-2 Notes is March 2029. If the Issuer has not repaid or refinanced the 2022 Class A-2 Notes prior to the anticipated repayment date, additional interest will accrue on the 2022 Notes. The 2022 Variable Funding Notes accrue interest at a variable rate based on (i) the prime rate, (ii) the overnight federal funds rates, (iii) the secured overnight financing rate, or (iv) with respect to advances made by conduit investors, the weighted average cost of, or related to, the issuance of commercial paper allocated to fund or maintain such advances, in each case plus any applicable margin, as more fully set forth in the 2022 Variable Funding Note Purchase Agreement, dated March 9, 2022, and the indenture supplement. Commitment fees and other usage fees apply to the 2022 Variable Funding Notes facility depending on the type of borrowing requested. There is a 60-basis points draw fee on borrowings requested pursuant to the terms of the 2022 Variable Fund Notes. Additionally, during a commitment availability period, there is a 30-basis point commitment fee on the committed portion of the 2022 Variable Funding Notes. The 2020 Notes and the 2022 Notes (together, the “Notes”) are subject to a series of covenants and restrictions customary for transactions of this type, including (i) that the Issuer maintains specified reserve accounts to be used to make required payments in respect of the Notes, (ii) provisions relating to optional and mandatory prepayments and the related payment of specified amounts, including specified make-whole payments in the case of the Notes under certain circumstances, (iii) certain indemnification payments in the event, among other things, that the assets pledged as collateral for the Notes are in stated ways defective or ineffective, and (iv) covenants relating to recordkeeping, access to information, and similar matters. The Notes are also subject to customary rapid amortization events provided for in the indenture, including events tied to failure to maintain stated debt service coverage ratios, the sum of global gross sales for specified restaurants being below certain levels on certain measurement dates, certain change of control and manager termination events, an event of default, and the failure to repay or refinance the Notes on the applicable scheduled maturity date. The Notes are also subject to certain customary events of default, including events relating to non-payment of required interest, principal or other amounts due on or with respect to the Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective, and certain judgments. As of December 30, 2023, the Company was in compliance with all financial covenants. During the first quarter of 2022, as a result of the termination of the 2020 variable funding note facility, the Company recorded a loss on debt extinguishment of $0.8 million related to the write-off of previously capitalized financing costs. Total debt issuance costs incurred and capitalized in connection with the issuance of the 2022 Notes were $5.5 million. As of December 30, 2023, the Company’s leverage ratio under the 2020 Class A-2 Notes and the 2022 Class A-2 Notes was less than 5.0x. Per the terms of the Company’s debt agreements, principal payments can be suspended at the borrower’s election until the repayment date as long as the Company maintains a leverage ratio of less than 5.0x. Accordingly, the Company elected to suspend payments following the principal payment made in the second quarter of 2023, and the entire outstanding balance of the 2020 Class A-2 Notes and the 2022 Class A-2 Notes has been classified as long-term debt due after fiscal year 2026. The 2020 Class A-2 Notes and the 2022 Class A-2 Notes are generally subject to 1% annual amortization. |
Leases
Leases | 12 Months Ended |
Dec. 30, 2023 | |
Leases [Abstract] | |
Leases | (12) Leases The Company determines whether an arrangement is a lease at inception. The Company has operating leases for retail space, as well as equipment. The Company's leases have remaining terms of 10.0 years to 0.1 years, some of which include options to extend the lease term for up to ten years. Lease terms may include options to renew when it is reasonably certain that the Company will exercise that option. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available on the commencement date in determining the present value of lease payments. The Company has lease agreements that contain both lease and non-lease components. For real estate leases, the Company accounts for lease components together with non-lease components (e.g., common-area maintenance). Components of lease expense were as follows (in thousands): Year Ended December 30, December 31, December 25, 2021 Operating lease cost (1) $ 3,523 $ 3,244 $ 2,294 Variable lease cost (2) 733 448 529 Total lease cost $ 4,256 $ 3,692 $ 2,823 (1) Includes short-term leases, which are immaterial. (2) Primarily related to adjustments for inflation, common area maintenance, and property tax. Supplemental cash flow information related to leases is as follows (in thousands): Year Ended December 30, December 31, December 25, 2021 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 3,348 $ 3,543 $ 2,923 Non-cash activity: Right-of-use assets obtained in exchange for new operating lease liabilities $ 6,346 $ 3,923 $ 12,107 Supplemental balance sheet information related to our operating leases is as follows (in thousands): Year Ended Balance Sheet Classification December 30, December 31, Right-of-use assets Other non-current assets $ 19,092 $ 15,613 Current lease liabilities Other current liabilities 2,380 2,283 Non-current lease liabilities Other non-current liabilities 17,807 14,342 Weighted average lease term and discount rate information related to leases was as follows: Year Ended December 30, December 31, December 25, 2021 Weighted average remaining lease term of operating leases 7.1 years 7.5 years 7.4 years Weighted average discount rate of operating leases 4.52 % 3.86 % 3.81 % Maturities of lease liabilities by fiscal year are as follows (in thousands): Fiscal year 2024 $ 3,606 Fiscal year 2025 3,537 Fiscal year 2026 3,175 Fiscal year 2027 2,789 Fiscal year 2028 2,690 Thereafter 7,546 Total future minimum lease payments 23,344 Less: imputed interest (3,157) Total lease liabilities $ 20,187 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (13) Commitments and Contingencies The Company is subject to legal proceedings, claims, and liabilities, such as employment-related claims and other cases, which arise in the ordinary course of business and are generally covered by insurance. In the opinion of management, the amount of ultimate liability with respect to those actions should not have a material adverse impact on financial position, results of operations, or cash flows. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 30, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | (14) Employee Benefit Plan The Company sponsors a 401(k) profit sharing plan for all employees who are eligible based upon age and length of service. The Company made matching contributions of approximately $1.1 million, $0.9 million, and $0.7 million for fiscal years 2023, 2022, and 2021, respectively. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | (15) Stock-Based Compensation The Wingstop Inc. 2015 Omnibus Equity Incentive Plan (as amended, the “2015 Plan”), was adopted in June 2015 and is the only plan under which the Company currently grants awards. The 2015 Plan provides for the grant or award of stock options, stock appreciation rights, restricted stock awards, restricted stock units, performance unit awards, performance share awards, cash-based awards and other stock-based awards to employees, directors, and other eligible persons. Stock options issued under the 2015 Plan expire ten years from the date of the grant. As of December 30, 2023, there were approximately 1.4 million shares available for future grants under the 2015 Plan. In the event of a change in control of the Company (as defined in the 2015 Plan) in connection with which the board of directors or the Compensation Committee of the board of directors determines prior to such change in control that outstanding awards will be honored or assumed or new rights substituted therefore (as required by the Plan), each outstanding award will continue to vest in accordance with its terms. In the event the outstanding awards are not assumed or new rights substituted therefore in connection with the transaction, the awards will become fully vested and, to the extent applicable, exercisable immediately prior to the change in control and shall be exchanged for cash. Stock-based compensation is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite employee service period. The Company recognized approximately $15.6 million, $4.2 million, and $9.6 million in stock compensation expense, net of forfeitures, for fiscal years 2023, 2022, and 2021, respectively, with a corresponding increase to additional paid-in-capital. The Company recognized forfeitures of $1.3 million and $6.6 million for fiscal years 2023 and 2022, respectively. Stock compensation expense is included in Selling, general and administrative in the Consolidated Statements of Comprehensive Income. Assumptions made regarding forfeitures in determining the remaining unamortized share-based compensation are re-evaluated periodically. Stock Options The following table summarizes stock option activity: Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Term (in years) Stock options outstanding at December 31, 2022 33 $ 112.28 $ 884 8.2 Options granted — $ — Options exercised (5) $ 79.85 Options forfeited — $ — Stock options outstanding at December 30, 2023 28 $ 117.77 $ 3,940 7.4 Stock options exercisable at December 30, 2023 17 $ 104.31 $ 2,521 7.0 The total intrinsic value of stock options exercised was $0.4 million, $1.1 million, and $0.6 million for fiscal years 2023, 2022, and 2021, respectively. As of December 30, 2023, there was $0.3 million of total unrecognized stock compensation expense related to non-vested stock options, which will be recognized over a weighted average period of approximately 0.9 years. Restricted Stock Units Restricted stock units are granted to employees and generally vest in equal annual amounts over a three year period. The fair value of restricted stock units is based on the closing price on the date of grant. The following table summarizes activity related to restricted stock units: Number of Shares Weighted Average Grant Date Fair Value Nonvested restricted stock units at December 31, 2022 63 $ 120.12 Units granted 49 174.57 Units vested (17) 124.79 Units forfeited (16) 152.99 Nonvested restricted stock units at December 30, 2023 79 $ 146.03 As of December 30, 2023, total unrecognized compensation expense related to unvested restricted stock units was $7.7 million, which is expected to be recognized over a weighted-average period of 1.8 years. The weighted-average grant date fair value of restricted stock units granted was $174.57, $116.30, and $138.38 in fiscal years 2023, 2022, and 2021, respectively. The total fair value of restricted stock units that vested in fiscal years 2023, 2022, and 2021 was $2.1 million, $2.0 million, and $1.9 million, respectively. Performance Stock Units Performance stock units (“PSUs”) represent a right to receive a certain number of shares of common stock based on the achievement of company performance goals and continued employment during the vesting period. Performance stock units cliff-vest at the end of a three year service period or vest in equal annual amounts over a three year period. Vested amounts may range from 0% to a maximum of 250% of targeted amounts depending on the achievement of performance measures at the end of each vesting period. Such performance measures are based on the Company meeting net new restaurant targets, return on incremental investment targets, or sales targets for the vesting period. The fair value of PSUs is based on the closing price on the date of grant. The compensation expense related to these PSUs is recognized over the vesting period when the achievement of the performance conditions becomes probable. The total compensation cost for the PSUs is determined based on the most likely outcome of the performance condition and the number of awards expected to vest. The following table summarizes activity related to performance stock units: Number of Shares Weighted Average Grant Date Fair Value Nonvested performance stock units at December 31, 2022 65 $ 122.75 Units granted (a) 59 $ 145.15 Units vested (35) $ 88.00 Units forfeited (8) $ 154.28 Nonvested performance stock units at December 30, 2023 81 $ 151.03 (a) Includes 18,000 incremental PSUs earned with respect to the PSUs granted in fiscal year 2020 and vested in fiscal year 2023 at greater than 100% of target based on performance. |
Restaurant Transactions
Restaurant Transactions | 12 Months Ended |
Dec. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Restaurant Transactions | (16) Restaurant Transactions The Company acquired three restaurants from franchisees during each of the fiscal years ended December 30, 2023, December 31, 2022 and December 25, 2021. The total purchase prices are reflected in the table below and were all funded by cash flows from operations. The following table summarizes the allocations of the purchase prices to the estimated fair values of assets acquired and liabilities assumed as a result of these acquisitions (in thousands): Fiscal Year December 30, 2023 December 31, 2022 December 25, 2021 Working capital $ — $ 17 $ 61 Property and equipment 217 155 148 Reacquired franchise rights 5,330 2,000 1,400 Goodwill 5,285 5,637 3,267 Total purchase price $ 10,832 $ 7,809 $ 4,876 The results of operations of these restaurants are included in the Consolidated Statements of Comprehensive Income since the date of acquisition. The acquisitions were accounted for as business combinations. The excess of the purchase price over the aggregate fair value of assets acquired was allocated to goodwill and is attributable to the benefits expected as a result of the acquisition, including sales and growth opportunities. All of the goodwill from the acquisitions is expected to be deductible for federal income tax purposes. Pro-forma financial information of the combined entities is not presented due to the immaterial impact of the financial results of the acquired restaurants on our consolidated financial statements. The fair value measurement of tangible and intangible assets and liabilities as of the acquisition date is based on significant inputs not observed in the market and thus represents a Level 3 fair value measurement. Fair value measurements for reacquired franchise rights were determined using the income approach. Fair value measurements for property and equipment were determined using the cost approach. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 12 Months Ended |
Dec. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | (17) Revenue from Contracts with Customers The following table represents a disaggregation of revenue from contracts with customers for the fiscal years 2023, 2022, and 2021 (in thousands): Fiscal Year December 30, December 31, December 25, Royalty revenue $ 186,455 $ 142,900 $ 119,396 Advertising fees 157,138 119,011 81,529 Franchise fees 5,064 4,357 4,020 Franchise fee, development fee, and international territory fee payments received by the Company are recorded as deferred revenue on the Consolidated Balance Sheets, which represents a contract liability. Deferred revenue is reduced as fees are recognized in revenue over the term of the franchise license for the respective restaurant. As the term of the franchise license is typically ten years, substantially all of the franchise fee revenue recognized in the current fiscal year was included in the deferred revenue balance as of December 31, 2022. Approximately $9.3 million and $7.7 million of deferred revenue as of December 30, 2023 and December 31, 2022, respectively, relates to restaurants that were not yet opened, so the fees are not yet being amortized. The weighted average remaining amortization period for deferred franchise and renewal fees related to open restaurants is 7.1 years. The Company did not have any material contract assets as of December 30, 2023. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Pay vs Performance Disclosure | |||
Net income | $ 70,175 | $ 52,947 | $ 42,658 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 30, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | (a) Principles of Consolidation The accompanying consolidated financial statements include the accounts of Wingstop Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Fiscal Year End | (b) Fiscal Year End The Company uses a 52/53-week fiscal year that ends on the last Saturday of the calendar year. Fiscal years 2023, 2022, and 2021 included 52, 53, and 52 weeks, respectively. The 53 rd week in fiscal 2022 fell in the fourth fiscal quarter. |
Use of Estimates | (c) Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions, primarily related to long-lived asset valuation, indefinite and finite lived intangible asset valuation, income taxes, investments, leases, stock-based compensation, contingencies, and common stock equity valuations. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the period. Although management bases its estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, actual results could differ from those estimates. |
Cash, Cash Equivalents, and Restricted Cash | (d) Cash, Cash Equivalents, and Restricted Cash The Company continually monitors its positions with, and the credit quality of, the financial institutions in which it maintains its deposits and investments. As of December 30, 2023 and December 31, 2022, the Company maintained balances in various cash accounts in excess of federally insured limits. All highly liquid instruments purchased with an original maturity of three months or less are considered cash equivalents. |
Accounts Receivable | (e) Accounts Receivable Accounts receivable, net of allowance for doubtful accounts, consists primarily of accrued royalty fee receivables, collected weekly in arrears, and vendor rebates. Management determines the allowance for doubtful accounts based on historical losses and current economic conditions. On a continuing basis, management analyzes delinquent receivables, which are charged off against the existing allowance account when determined to be uncollectible. |
Inventories | (f) Inventories Inventories, which consist of food and beverage products, paper goods, and supplies, are valued at the lower of cost (first-in, first-out) or net realizable value. |
Property and Equipment | (g) Property and Equipment At the time property and equipment are retired, the asset and accumulated depreciation are removed from the accounts, and any resulting gain or loss is included in earnings. The Company expenses repair and maintenance costs that maintain the appearance and functionality of the restaurant but do not extend the useful life of any restaurant asset. Improvements to leased properties are depreciated over the shorter of their useful life or the lease term, which includes a fixed, non-cancelable lease term plus any reasonably assured renewal periods. See Note 6 for additional information. |
Impairment or Disposal of Long-Lived Assets | (h) Impairment or Disposal of Long-Lived Assets |
Goodwill and Indefinite-Lived Intangible Assets | (i) Goodwill and Indefinite-Lived Intangible Assets The Company’s indefinite-lived intangible assets consist of goodwill and trademarks, which are not subject to amortization. We generally record goodwill in connection with the acquisition of restaurants from franchisees. On an annual basis (October 1 st of each fiscal year) and whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable, the Company reviews the recoverability of goodwill and indefinite-lived intangible assets. No indications of impairment were identified during fiscal years 2023, 2022, or 2021. It is possible that changes in circumstances or changes in management’s judgments, assumptions, and estimates could result in an impairment charge of a portion or all of its goodwill or other intangible assets. |
Foreign Currency Translation | (j) Foreign Currency Translation The foreign currency translation adjustment included in the Consolidated Statements of Comprehensive Income represents the unrealized impact of translating our foreign investment. This amount is not included in Net income and would only be realized upon disposition of our investment. The related Accumulated other comprehensive loss is presented in the Consolidated Balance Sheets. |
Revenue Recognition | (k) Revenue Recognition Revenues consist primarily of royalties, national advertising fund (the "Ad Fund") contributions (advertising fees), initial and renewal franchise fees, and upfront fees from development agreements and international territory agreements. The Company's performance obligations under its franchise agreements consist of (a) a franchise license, (b) pre-opening services, such as training, and (c) ongoing services, such as management of the Ad Fund contributions, development of training materials and menu items, and restaurant monitoring. These performance obligations are highly interrelated, so they are not considered to be individually distinct and therefore are accounted for as a single performance obligation, which is satisfied by providing a right to use the Company's intellectual property over the term of each franchise agreement. Franchise fee, development fee and international territory fee payments received by the Company before the restaurant opens are recorded as deferred revenue in the Consolidated Balance Sheets. Royalties, including franchisee contributions to the Ad Fund, are calculated as a percentage of franchise restaurant sales over the term of the franchise agreement. Initial and renewal franchise fees are payable by the franchisee prior to the restaurant opening or at the time of a renewal of an existing franchise agreement. The Company's franchise agreement royalties, inclusive of Ad Fund contributions, represent sales-based royalties that are related entirely to the Company's performance obligation under the franchise agreement and are recognized as franchised restaurant sales occur, payable weekly. Additionally, initial and renewal franchise fees are recognized as revenue on a straight-line basis over the term of the respective agreement. The Company's performance obligation under development agreements and international territory agreements generally consists of an obligation to grant exclusive development rights over a stated term. These development rights are not distinct from franchise agreements, so upfront fees paid by franchisees for development rights are apportioned to each franchised restaurant opened and accounted for as an initial franchise fee. The Company records food and beverage revenues from company-owned restaurants upon sale to the customer. The Company collects and remits sales, food and beverage, alcoholic beverage, and hospitality taxes on transactions with customers and reports such amounts under the net method in its Consolidated Statements of Comprehensive Income. Accordingly, these taxes are not included in gross revenue. The Company records a liability in the period in which a gift card is sold. As gift cards are redeemed, the liability is reduced. When gift cards are redeemed at a franchisee-operated restaurant, the revenue and related administrative costs are recognized by the franchisee. The Company recognizes revenue and related administrative costs when gift cards are redeemed at company-owned restaurants. |
Consideration from Vendors | (l) Consideration from Vendors |
Advertising Expenses | (m) Advertising Expenses The Company administers the Ad Fund, for which a percentage of gross sales is collected from domestic restaurant franchisees and company-owned restaurants to be used for various forms of advertising for the Wingstop brand. Effective the first day of the fiscal second quarter of 2022, domestic franchisees’ contribution rates to the national advertising fund increased to 5%, up from 4%, of gross sales. The national advertising fund contribution rate was 4% for fiscal year 2021. The Company administers and directs the development of all advertising and promotion programs in the Ad Fund for which it collects advertising contributions in accordance with the provisions of its franchise agreements. The Company has a contractual obligation with regard to these advertising contributions. The Company consolidates and reports all assets and liabilities of the Ad Fund as restricted assets of the Ad Fund and liabilities of the Ad Fund within current assets and current liabilities, respectively, in the Consolidated Balance Sheets. The assets and liabilities of the Ad Fund consist primarily of cash, receivables, accrued expenses, and other liabilities. Pursuant to the Company’s franchise agreements, use of Ad Fund contributions is restricted to advertising, public relations, merchandising, similar activities, and administrative expenses to increase sales and further enhance the public reputation of the Wingstop brand. The aforementioned administrative expenses may also include personnel expenses and allocated costs incurred by the Company that are directly associated with administering the Ad Fund, as outlined in the provisions of the applicable franchise agreements. |
Leases | (n) Leases The Company determines whether an arrangement is a lease at inception and leases restaurants and office space under operating leases. Most lease agreements contain tenant improvement allowances, rent holidays, rent escalation clauses, and/or contingent rent provisions. For leases with renewal periods at the Company’s option, the Company determines the expected lease period based on whether the renewal of any options are reasonably certain at the inception of the lease. For purposes of measurement and amortization of the right-of-use asset and associated lease liability over the terms of the leases, the Company uses the date it takes possession of the leased space for construction purposes at the beginning of the lease term, which is generally two |
Stock-Based Compensation | (o) Stock-Based Compensation The Company measures stock-based compensation cost at fair value on the date of grant for all share-based awards and recognizes compensation expense over the service period that the awards are expected to vest. The Company has elected to recognize compensation cost for graded-vesting awards subject only to a service condition over the requisite service period of the entire award. For performance awards, the Company recognizes expense in the period in which vesting becomes probable. The Company accounts for forfeitures as they occur. |
Income Taxes | (p) Income Taxes Income taxes are accounted for under the asset and liability method. Under this method, a deferred tax asset or liability is recognized for the estimated future tax effects attributable to temporary differences between the financial statement basis and the tax basis of assets and liabilities as well as tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period of the change. The Company files a consolidated federal income tax return including all of its wholly-owned subsidiaries. Judgment is required in evaluating the Company’s uncertain tax positions and determining the Company’s income tax expense. The Company assesses the income tax position and records the liabilities for all years subject to examination based upon management’s evaluation of the facts, circumstances, and information available at the reporting date. |
Recent Accounting Pronouncements | (q) Recent Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standard Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure . The ASU updates reportable segment disclosure requirements, primarily through requiring enhanced disclosures about significant segment expenses and information used to assess segment performance. The ASU is effective for fiscal years beginning after December 15, 2023, with early adoption permitted. We are currently evaluating the impact of adopting this ASU on our disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . The ASU includes amendments requiring enhanced income tax disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and can be applied either prospectively or retrospectively. We are currently evaluating the impact of adopting this ASU on our disclosures. We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our consolidated financial statements. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Cash and Cash Equivalents | Cash, cash equivalents, and restricted cash within the Consolidated Balance Sheets that are included in the Consolidated Statements of Cash Flows as of December 30, 2023 and December 31, 2022 were as follows (in thousands): December 30, 2023 December 31, 2022 Cash and cash equivalents $ 90,216 $ 184,496 Restricted cash 11,444 13,296 Restricted cash, included in Advertising fund assets, restricted 18,016 7,923 Total cash, cash equivalents, and restricted cash $ 119,676 $ 205,715 |
Schedule of Restricted Cash | Cash, cash equivalents, and restricted cash within the Consolidated Balance Sheets that are included in the Consolidated Statements of Cash Flows as of December 30, 2023 and December 31, 2022 were as follows (in thousands): December 30, 2023 December 31, 2022 Cash and cash equivalents $ 90,216 $ 184,496 Restricted cash 11,444 13,296 Restricted cash, included in Advertising fund assets, restricted 18,016 7,923 Total cash, cash equivalents, and restricted cash $ 119,676 $ 205,715 |
Schedule of Property and Equipment Estimated Useful Lives | Property and equipment is depreciated based on the straight-line method over the following estimated useful lives: Property and Equipment Estimated Useful Lives Building 40 years Leasehold and other improvements Lesser of 7 to 10 years or the expected lease term Equipment, furniture and fixtures 3 to 7 years Computer software 3 years Property and equipment, net, consisted of the following (in thousands): December 30, December 31, Building 15,769 15,769 Construction in progress 46,675 23,008 Equipment, furniture and fixtures 41,268 33,406 Leasehold and other improvements 26,599 23,295 Land 2,828 2,828 Property and equipment, gross 133,139 98,306 Less: accumulated depreciation (41,847) (31,455) Property and equipment, net $ 91,292 $ 66,851 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Basic Shares Outstanding to Diluted Shares Outstanding | Basic weighted average shares outstanding is reconciled to diluted weighted average shares outstanding as follows (in thousands): Fiscal Year December 30, December 31, December 25, Basic weighted average shares outstanding 29,769 29,893 29,769 Dilutive shares 87 70 175 Diluted weighted average shares outstanding 29,856 29,963 29,944 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Measurements | Fair value of debt is determined on a non-recurring basis, which results are summarized as follows (in thousands): Fair Value Hierarchy December 30, 2023 December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value Securitized Financing Facility: 2020-1 Class A-2 Senior Secured Notes (1) Level 2 $ 472,800 $ 423,823 $ 475,200 $ 406,462 2022-1 Class A-2 Senior Secured Notes (1) Level 2 $ 248,125 $ 222,370 $ 249,375 $ 215,709 Investments in bonds of LPH (Note 10) (2) Level 3 $ 3,557 $ 4,306 $ 3,196 $ 3,906 (1) The fair value of the 2020-1 and 2022-1 Class A-2 Senior Secured Notes was estimated using available market information. (2) The fair value approximates discounted cash flows using current market rates for debt investments with similar maturities and credit risk. |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable, Net | Accounts receivable, net, consist of the following (in thousands): December 30, December 31, Vendor rebates receivable $ 5,311 $ 3,610 Royalties receivable 5,717 3,811 Other receivables, net 1,380 2,040 Accounts receivable, net $ 12,408 $ 9,461 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment is depreciated based on the straight-line method over the following estimated useful lives: Property and Equipment Estimated Useful Lives Building 40 years Leasehold and other improvements Lesser of 7 to 10 years or the expected lease term Equipment, furniture and fixtures 3 to 7 years Computer software 3 years Property and equipment, net, consisted of the following (in thousands): December 30, December 31, Building 15,769 15,769 Construction in progress 46,675 23,008 Equipment, furniture and fixtures 41,268 33,406 Leasehold and other improvements 26,599 23,295 Land 2,828 2,828 Property and equipment, gross 133,139 98,306 Less: accumulated depreciation (41,847) (31,455) Property and equipment, net $ 91,292 $ 66,851 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following is a summary of goodwill balances and activity (in thousands): December 30, December 31, Balance, beginning of period $ 62,514 $ 56,877 Acquisition of restaurants, net 5,194 5,637 Balance, end of period $ 67,708 $ 62,514 |
Schedule of Intangible Assets, Excluding Goodwill | Intangible assets, excluding goodwill, consisted of the following (in thousands): December 30, December 31, Weighted Average Amortization Period (in years) Intangible assets: Trademarks $ 32,700 $ 32,700 Indefinite-lived assets 32,700 32,700 Customer relationships 26,300 26,300 20.0 Franchise rights (1) 14,168 9,038 6.2 Less: accumulated amortization (24,488) (21,931) Definite-lived assets 15,980 13,407 16.7 Intangible assets, net $ 48,680 $ 46,107 (1) Included within Other non-current assets net of associated accumulated amortization within the Consolidated Balance Sheets. |
Schedule of Intangible Assets, Future Amortization Expense | Estimated amortization expense, for the five succeeding fiscal years and the aggregate thereafter is (in thousands): Fiscal year 2024 $ 2,898 Fiscal year 2025 2,711 Fiscal year 2026 2,504 Fiscal year 2027 2,366 Fiscal year 2028 2,177 Thereafter 3,324 Total $ 15,980 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following (in thousands): December 30, December 31, Prepaid expenses $ 3,567 $ 2,735 Inventories 535 389 Other current assets 846 1,128 Total $ 4,948 $ 4,252 |
Schedule of Other Current Liabilities | Other current liabilities consisted of the following (in thousands): December 30, December 31, Accrued payroll and incentive compensation $ 14,331 $ 8,733 Current portion of deferred revenues 4,846 4,476 Taxes payable 2,948 6,401 Short term lease liability 2,380 2,283 Accrued interest 1,702 1,711 Gift card liability 1,926 1,565 Other accrued liabilities 12,818 9,557 Total $ 40,951 $ 34,726 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Expense | Income tax expense for the fiscal years 2023, 2022, and 2021 consisted of the following (in thousands): Fiscal Year December 30, December 31, December 25, Current expense Federal $ 19,398 $ 15,909 $ 10,432 State 4,586 3,384 2,601 Foreign 610 328 263 Deferred expense (benefit) Federal (314) (2,996) 2,994 State (145) (256) (41) Income tax expense $ 24,135 $ 16,369 $ 16,249 |
Schedule of US Federal Income Tax Rate Reconciliation | A reconciliation of income tax at the U.S. federal statutory tax rate (using a statutory tax rate of 21%) to income tax expense for fiscal years 2023, 2022, and 2021 in dollars is as follows (in thousands): Fiscal Year December 30, December 31, December 25, Expected income tax expense at statutory rate $ 19,777 $ 14,556 $ 12,370 Excess tax benefits from equity compensation (1,275) (522) (591) Non-deductible expenses 3,106 935 1,880 State tax expense, net of federal benefit 3,164 2,090 2,091 Foreign tax expense 610 328 263 Foreign tax and other tax credits (1,760) (1,001) (385) Increase in unrecognized tax benefit 398 337 296 Other 115 (354) 325 Income tax expense $ 24,135 $ 16,369 $ 16,249 |
Schedule of Deferred Tax Assets (Liabilities) | The components of deferred tax assets (liabilities) were as follows (in thousands): December 30, 2023 December 31, 2022 Deferred tax assets: Deferred revenue $ 6,067 $ 6,352 Accrued incentive compensation 1,596 891 Stock based compensation 1,444 1,345 Lease liabilities 4,720 3,863 Intangible assets 196 76 Other 1,365 2,493 Net operating loss carry-forwards and credits 827 1,061 Valuation allowance (577) (577) 15,638 15,504 Deferred tax liabilities: Intangible assets (10,397) (10,397) Right of use assets (4,464) (3,628) Property and equipment (4,498) (5,659) (19,359) (19,684) Net deferred tax liability $ (3,721) $ (4,180) |
Schedule of Unrecognized Tax Benefits Roll Forward | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Balance as of December 26, 2020 $ 794 Additions for tax positions of prior years — Subtractions for tax positions of prior years (34) Additions for tax positions of current year 295 Subtractions for tax positions of current year — Balance as of December 25, 2021 1,055 Additions for tax positions of prior years — Subtractions for tax positions of prior years (27) Additions for tax positions of current year 270 Subtractions for tax positions of current year — Balance as of December 31, 2022 1,298 Additions for tax positions of prior years — Subtractions for tax positions of prior years (65) Additions for tax positions of current year 468 Subtractions for tax positions of current year — Balance as of December 30, 2023 $ 1,701 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt consisted of the following components (in thousands): December 30, 2023 December 31, 2022 2020-1 Class A-2 Senior Secured Notes $ 472,800 475,200 2022-1 Class A-2 Senior Secured Notes 248,125 249,375 Debt issuance costs, net of amortization (8,598) (10,429) Less: current portion of debt — (7,300) Long-term debt, net $ 712,327 $ 706,846 |
Schedule of Maturities of Long-term Debt | As of December 30, 2023, the scheduled principal payments on debt were as follows (in thousands): Fiscal year 2024 $ — Fiscal year 2025 — Fiscal year 2026 — Fiscal year 2027 472,800 Fiscal year 2028 — Thereafter 248,125 Total $ 720,925 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Leases [Abstract] | |
Schedule of Lease Expense | Components of lease expense were as follows (in thousands): Year Ended December 30, December 31, December 25, 2021 Operating lease cost (1) $ 3,523 $ 3,244 $ 2,294 Variable lease cost (2) 733 448 529 Total lease cost $ 4,256 $ 3,692 $ 2,823 (1) Includes short-term leases, which are immaterial. (2) Primarily related to adjustments for inflation, common area maintenance, and property tax. Supplemental cash flow information related to leases is as follows (in thousands): Year Ended December 30, December 31, December 25, 2021 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 3,348 $ 3,543 $ 2,923 Non-cash activity: Right-of-use assets obtained in exchange for new operating lease liabilities $ 6,346 $ 3,923 $ 12,107 |
Schedule of Supplemental Balance Sheet Information Related to Operating Leases | Supplemental balance sheet information related to our operating leases is as follows (in thousands): Year Ended Balance Sheet Classification December 30, December 31, Right-of-use assets Other non-current assets $ 19,092 $ 15,613 Current lease liabilities Other current liabilities 2,380 2,283 Non-current lease liabilities Other non-current liabilities 17,807 14,342 |
Schedule of Weighted Average Lease Term and Discount Rate Information | Weighted average lease term and discount rate information related to leases was as follows: Year Ended December 30, December 31, December 25, 2021 Weighted average remaining lease term of operating leases 7.1 years 7.5 years 7.4 years Weighted average discount rate of operating leases 4.52 % 3.86 % 3.81 % |
Schedule of Future Maturities of Lease Liabilities | Maturities of lease liabilities by fiscal year are as follows (in thousands): Fiscal year 2024 $ 3,606 Fiscal year 2025 3,537 Fiscal year 2026 3,175 Fiscal year 2027 2,789 Fiscal year 2028 2,690 Thereafter 7,546 Total future minimum lease payments 23,344 Less: imputed interest (3,157) Total lease liabilities $ 20,187 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock Option Activity | The following table summarizes stock option activity: Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Term (in years) Stock options outstanding at December 31, 2022 33 $ 112.28 $ 884 8.2 Options granted — $ — Options exercised (5) $ 79.85 Options forfeited — $ — Stock options outstanding at December 30, 2023 28 $ 117.77 $ 3,940 7.4 Stock options exercisable at December 30, 2023 17 $ 104.31 $ 2,521 7.0 |
Schedule of Restricted and Performance Stock Unit Activity | The following table summarizes activity related to restricted stock units: Number of Shares Weighted Average Grant Date Fair Value Nonvested restricted stock units at December 31, 2022 63 $ 120.12 Units granted 49 174.57 Units vested (17) 124.79 Units forfeited (16) 152.99 Nonvested restricted stock units at December 30, 2023 79 $ 146.03 |
Schedule of Non-vested Options Activity | The following table summarizes activity related to performance stock units: Number of Shares Weighted Average Grant Date Fair Value Nonvested performance stock units at December 31, 2022 65 $ 122.75 Units granted (a) 59 $ 145.15 Units vested (35) $ 88.00 Units forfeited (8) $ 154.28 Nonvested performance stock units at December 30, 2023 81 $ 151.03 (a) Includes 18,000 incremental PSUs earned with respect to the PSUs granted in fiscal year 2020 and vested in fiscal year 2023 at greater than 100% of target based on performance. |
Restaurant Transactions (Tables
Restaurant Transactions (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Purchase Price Allocation for Acquisitions | The following table summarizes the allocations of the purchase prices to the estimated fair values of assets acquired and liabilities assumed as a result of these acquisitions (in thousands): Fiscal Year December 30, 2023 December 31, 2022 December 25, 2021 Working capital $ — $ 17 $ 61 Property and equipment 217 155 148 Reacquired franchise rights 5,330 2,000 1,400 Goodwill 5,285 5,637 3,267 Total purchase price $ 10,832 $ 7,809 $ 4,876 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 12 Months Ended |
Dec. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table represents a disaggregation of revenue from contracts with customers for the fiscal years 2023, 2022, and 2021 (in thousands): Fiscal Year December 30, December 31, December 25, Royalty revenue $ 186,455 $ 142,900 $ 119,396 Advertising fees 157,138 119,011 81,529 Franchise fees 5,064 4,357 4,020 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Overview (Details) | 12 Months Ended |
Dec. 30, 2023 restaurant | |
Franchisor Disclosure [Line Items] | |
Number of restaurants (in restaurants) | 2,214 |
Franchised Units | |
Franchisor Disclosure [Line Items] | |
Number of restaurants (in restaurants) | 2,165 |
Proportion of restaurants that are franchised (as a percent) | 98% |
Franchised Units | Non-US | |
Franchisor Disclosure [Line Items] | |
Number of restaurants (in restaurants) | 288 |
Entity Operated Units | |
Franchisor Disclosure [Line Items] | |
Number of restaurants (in restaurants) | 49 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Cash and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 90,216 | $ 184,496 | ||
Restricted cash | 11,444 | 13,296 | ||
Restricted cash, included in Advertising fund assets, restricted | 18,016 | 7,923 | ||
Total cash, cash equivalents, and restricted cash | $ 119,676 | $ 205,715 | $ 54,906 | $ 59,270 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($) | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Property and Equipment [Line Items] | |||
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 |
Goodwill and indefinite-lived intangible asset impairment | $ 0 | $ 0 | $ 0 |
Building | |||
Property and Equipment [Line Items] | |||
Building, equipment, furniture and fixtures useful life (in years) | 40 years | ||
Leasehold and other improvements | Minimum | |||
Property and Equipment [Line Items] | |||
Building, equipment, furniture and fixtures useful life (in years) | 7 years | ||
Leasehold and other improvements | Maximum | |||
Property and Equipment [Line Items] | |||
Building, equipment, furniture and fixtures useful life (in years) | 10 years | ||
Equipment, furniture and fixtures | Minimum | |||
Property and Equipment [Line Items] | |||
Building, equipment, furniture and fixtures useful life (in years) | 3 years | ||
Equipment, furniture and fixtures | Maximum | |||
Property and Equipment [Line Items] | |||
Building, equipment, furniture and fixtures useful life (in years) | 7 years | ||
Computer software | |||
Property and Equipment [Line Items] | |||
Computer software useful life (in years) | 3 years |
Basis of Presentation and Sum_7
Basis of Presentation and Summary of Significant Accounting Policies - Consideration from Vendors (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Franchisor Disclosure [Line Items] | |||
Incentives from vendors recognized | $ 17.7 | $ 13.1 | $ 8.7 |
Cost of Sales | |||
Franchisor Disclosure [Line Items] | |||
Incentives from vendors recognized | $ 2.3 | $ 1.8 | $ 1.6 |
Basis of Presentation and Sum_8
Basis of Presentation and Summary of Significant Accounting Policies - Advertising Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Jun. 25, 2022 | Mar. 26, 2022 | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Accounting Policies [Abstract] | |||||
Revenue collected for advertising fund (as a percent) | 5% | 4% | 4% | ||
Cost of Sales | |||||
Franchisor Disclosure [Line Items] | |||||
Advertising expenses | $ 4.9 | $ 3.6 | $ 3.3 |
Basis of Presentation and Sum_9
Basis of Presentation and Summary of Significant Accounting Policies - Leases (Details) | 12 Months Ended |
Dec. 30, 2023 | |
Minimum | |
Operating Leased Assets [Line Items] | |
Lease possession period before restaurant's opening date (in months) | 2 months |
Maximum | |
Operating Leased Assets [Line Items] | |
Lease possession period before restaurant's opening date (in months) | 3 months |
Earnings Per Share - Summary (D
Earnings Per Share - Summary (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Earnings Per Share [Abstract] | |||
Basic weighted average shares outstanding (in shares) | 29,769 | 29,893 | 29,769 |
Dilutive shares (in shares) | 87 | 70 | 175 |
Diluted weighted average shares outstanding (in shares) | 29,856 | 29,963 | 29,944 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Earnings Per Share [Abstract] | |||
Equity awards outstanding (in shares) | 0 | 19 | 3 |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Feb. 20, 2024 | Dec. 30, 2023 | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | Aug. 23, 2023 | Aug. 16, 2023 | |
Dividends Payable [Line Items] | |||||||
Dividends paid per share (in USD per share) | $ 0.82 | $ 4.72 | $ 0.62 | ||||
Purchases of common stock | $ 126,276,000 | ||||||
Stock repurchased (in shares) | 645,952 | ||||||
Subsequent event | |||||||
Dividends Payable [Line Items] | |||||||
Dividends payable per share (in USD per share) | $ 0.22 | ||||||
Dividends payable | $ 6,500,000 | ||||||
Share Repurchase Authorization | |||||||
Dividends Payable [Line Items] | |||||||
Stock repurchase, authorized amount | $ 250,000,000 | ||||||
ASR Agreement | |||||||
Dividends Payable [Line Items] | |||||||
Stock repurchase, authorized amount | $ 125,000,000 | $ 125,000,000 | $ 125,000,000 | ||||
Purchases of common stock | 125,000,000 | ||||||
Stock repurchased (in shares) | 645,952 | ||||||
Stock repurchased average share price (in usd per share) | $ 193.51 | ||||||
Quarterly dividends | |||||||
Dividends Payable [Line Items] | |||||||
Dividends paid | $ 24,400,000 | $ 21,500,000 | $ 18,500,000 | ||||
Dividends paid per share (in USD per share) | $ 0.82 | $ 0.72 | $ 0.62 | ||||
Special dividend | |||||||
Dividends Payable [Line Items] | |||||||
Dividends paid | $ 0 | $ 119,500,000 | $ 0 | ||||
Dividends paid per share (in USD per share) | $ 4 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Nonrecurring - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Level 2 | Carrying Value | 2020-1 Class A-2 Senior Secured Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument at fair value | $ 472,800 | $ 475,200 |
Level 2 | Carrying Value | 2022-1 Class A-2 Senior Secured Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument at fair value | 248,125 | 249,375 |
Level 2 | Fair Value | 2020-1 Class A-2 Senior Secured Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument at fair value | 423,823 | 406,462 |
Level 2 | Fair Value | 2022-1 Class A-2 Senior Secured Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument at fair value | 222,370 | 215,709 |
Level 3 | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments at fair value | 3,557 | 3,196 |
Level 3 | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments at fair value | $ 4,306 | $ 3,906 |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net | $ 12,408 | $ 9,461 |
Vendor rebates receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net | 5,311 | 3,610 |
Royalties receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net | 5,717 | 3,811 |
Other receivables, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net | $ 1,380 | $ 2,040 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Property and Equipment [Line Items] | ||
Property and equipment, gross | $ 133,139 | $ 98,306 |
Less: accumulated depreciation | (41,847) | (31,455) |
Property and equipment, net | 91,292 | 66,851 |
Building | ||
Property and Equipment [Line Items] | ||
Property and equipment, gross | 15,769 | 15,769 |
Construction in progress | ||
Property and Equipment [Line Items] | ||
Property and equipment, gross | 46,675 | 23,008 |
Equipment, furniture and fixtures | ||
Property and Equipment [Line Items] | ||
Property and equipment, gross | 41,268 | 33,406 |
Leasehold and other improvements | ||
Property and Equipment [Line Items] | ||
Property and equipment, gross | 26,599 | 23,295 |
Land | ||
Property and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,828 | $ 2,828 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 10.6 | $ 8.7 | $ 5.6 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2023 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | ||
Goodwill balance, beginning of period | $ 62,514 | $ 56,877 |
Acquisition of restaurants, net | 5,194 | 5,637 |
Goodwill balance, end of period | $ 67,708 | $ 62,514 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Intangible Assets Excluding Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2023 | Dec. 31, 2022 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived assets | $ 32,700 | $ 32,700 |
Finite-Lived Intangible Assets [Line Items] | ||
Less: accumulated amortization | (24,488) | (21,931) |
Intangible assets, net | 48,680 | 46,107 |
Trademarks | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived assets | 32,700 | 32,700 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Definite-lived assets, gross | 26,300 | 26,300 |
Definite-lived assets | $ 7,740 | 9,015 |
Weighted Average Amortization Period (in years) | 20 years | |
Franchise rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Definite-lived assets, gross | $ 14,168 | 9,038 |
Weighted Average Amortization Period (in years) | 6 years 2 months 12 days | |
Customer relationships and franchise rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Definite-lived assets | $ 15,980 | $ 13,407 |
Weighted Average Amortization Period (in years) | 16 years 8 months 12 days |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense of intangible assets | $ 2.7 | $ 2.2 | $ 2.3 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill - Amortization (Details) - Customer relationships and franchise rights - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Fiscal year 2024 | $ 2,898 | |
Fiscal year 2025 | 2,711 | |
Fiscal year 2026 | 2,504 | |
Fiscal year 2027 | 2,366 | |
Fiscal year 2028 | 2,177 | |
Thereafter | 3,324 | |
Total | $ 15,980 | $ 13,407 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets and Other Current Liabilities - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Balance Sheet Related Disclosures [Abstract] | ||
Prepaid expenses | $ 3,567 | $ 2,735 |
Inventories | 535 | 389 |
Other current assets | 846 | 1,128 |
Total | $ 4,948 | $ 4,252 |
Prepaid Expenses and Other Cu_4
Prepaid Expenses and Other Current Assets and Other Current Liabilities - Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Balance Sheet Related Disclosures [Abstract] | ||
Accrued payroll and incentive compensation | $ 14,331 | $ 8,733 |
Current portion of deferred revenues | 4,846 | 4,476 |
Taxes payable | 2,948 | 6,401 |
Short term lease liability | 2,380 | 2,283 |
Accrued interest | 1,702 | 1,711 |
Gift card liability | 1,926 | 1,565 |
Other accrued liabilities | 12,818 | 9,557 |
Total | $ 40,951 | $ 34,726 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Current expense | |||
Federal | $ 19,398 | $ 15,909 | $ 10,432 |
State | 4,586 | 3,384 | 2,601 |
Foreign | 610 | 328 | 263 |
Deferred expense (benefit) | |||
Federal | (314) | (2,996) | 2,994 |
State | (145) | (256) | (41) |
Income tax expense | $ 24,135 | $ 16,369 | $ 16,249 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
US federal statutory tax rate | 21% | 21% | 21% |
Expected income tax expense at statutory rate | $ 19,777 | $ 14,556 | $ 12,370 |
Excess tax benefits from equity compensation | (1,275) | (522) | (591) |
Non-deductible expenses | 3,106 | 935 | 1,880 |
State tax expense, net of federal benefit | 3,164 | 2,090 | 2,091 |
Foreign tax expense | 610 | 328 | 263 |
Foreign tax and other tax credits | (1,760) | (1,001) | (385) |
Increase in unrecognized tax benefit | 398 | 337 | 296 |
Other | 115 | (354) | 325 |
Income tax expense | $ 24,135 | $ 16,369 | $ 16,249 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Asset and Liabilities (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Deferred revenue | $ 6,067 | $ 6,352 |
Accrued incentive compensation | 1,596 | 891 |
Stock based compensation | 1,444 | 1,345 |
Lease liabilities | 4,720 | 3,863 |
Intangible assets | 196 | 76 |
Other | 1,365 | 2,493 |
Net operating loss carry-forwards and credits | 827 | 1,061 |
Valuation allowance | (577) | (577) |
Deferred tax assets, net of valuation allowance | 15,638 | 15,504 |
Deferred tax liabilities: | ||
Intangible assets | (10,397) | (10,397) |
Right of use assets | (4,464) | (3,628) |
Property and equipment | (4,498) | (5,659) |
Deferred tax liabilities | (19,359) | (19,684) |
Net deferred tax liability | $ (3,721) | $ (4,180) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 |
Tax Credit Carryforward [Line Items] | ||||
Valuation allowance | $ 577 | $ 577 | ||
Accrued interest and penalties on unrecognized tax benefits | 700 | 500 | ||
Unrecognized tax benefits | 1,701 | 1,298 | $ 1,055 | $ 794 |
State and Local Jurisdiction | ||||
Tax Credit Carryforward [Line Items] | ||||
Operating loss carryforward | $ 23,300 | $ 23,300 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits, beginning of period | $ 1,298 | $ 1,055 | $ 794 |
Additions for tax positions of prior years | 0 | 0 | 0 |
Subtractions for tax positions of prior years | (65) | (27) | (34) |
Additions for tax positions of current year | 468 | 270 | 295 |
Subtractions for tax positions of current year | 0 | 0 | 0 |
Unrecognized tax benefits, end of period | $ 1,701 | $ 1,298 | $ 1,055 |
Investments (Details)
Investments (Details) - Lemmon Pepper Holdings Ltd $ in Millions | Jun. 26, 2021 USD ($) |
Schedule of Equity Method Investments [Line Items] | |
Non-controlling interest in equity method investment (as a percent) | 20% |
Aggregate amount of equity method investments | $ 4.2 |
Debt Obligations - Components o
Debt Obligations - Components of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 | Mar. 26, 2022 |
Debt Instrument [Line Items] | |||
Debt issuance costs, net of amortization | $ (8,598) | $ (10,429) | |
Less: current portion of debt | 0 | (7,300) | |
Long-term debt, net | 712,327 | 706,846 | |
2020-1 Class A-2 Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Gross debt | 472,800 | 475,200 | |
2022-1 Class A-2 Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Gross debt | $ 248,125 | $ 249,375 | |
Debt issuance costs, net of amortization | $ (5,500) |
Debt Obligations - Narrative (D
Debt Obligations - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Mar. 26, 2022 | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | Mar. 09, 2022 | |
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity for line of credit | $ 200,000,000 | ||||
Loss on debt extinguishment | $ 0 | $ 814,000 | $ 0 | ||
Debt issuance costs incurred | $ 8,598,000 | $ 10,429,000 | |||
2020-1 Class A-2 Senior Secured Notes | |||||
Debt Instrument [Line Items] | |||||
Senior secured note fixed interest rate (as a percent) | 2.84% | ||||
Covenant, leverage ratio | 5 | ||||
Debt instrument, annual amortization, percentage | 1% | ||||
2022-1 Class A-2 Senior Secured Notes | |||||
Debt Instrument [Line Items] | |||||
Debt face amount | $ 250,000,000 | ||||
Senior secured note fixed interest rate (as a percent) | 3.734% | ||||
Debt issuance costs incurred | $ 5,500,000 | ||||
Debt instrument, annual amortization, percentage | 1% | ||||
2022 Variable Funding Notes | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, unused capacity, draw fee percentage | 0.60% | ||||
Commitment fee on unused portion of note facility (in basis points) | 0.30% | ||||
2022 Variable Funding Notes | Line of credit | |||||
Debt Instrument [Line Items] | |||||
Line of credit | $ 0 | ||||
2020 Variable Funding Notes | |||||
Debt Instrument [Line Items] | |||||
Loss on debt extinguishment | $ 800,000 | ||||
2020 Variable Funding Notes | Line of credit | |||||
Debt Instrument [Line Items] | |||||
Line of credit | $ 0 |
Debt Obligations - Schedule of
Debt Obligations - Schedule of Maturities (Details) $ in Thousands | Dec. 30, 2023 USD ($) |
Debt Disclosure [Abstract] | |
Fiscal year 2024 | $ 0 |
Fiscal year 2025 | 0 |
Fiscal year 2026 | 0 |
Fiscal year 2027 | 472,800 |
Fiscal year 2028 | 0 |
Thereafter | 248,125 |
Total | $ 720,925 |
Leases - Narrative (Details)
Leases - Narrative (Details) | Dec. 30, 2023 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Operating lease term of contract (in years) | 10 years |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Operating lease term of contract (in years) | 1 month 6 days |
Operating lease renewal term (in years) | 10 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Leases [Abstract] | |||
Operating lease cost | $ 3,523 | $ 3,244 | $ 2,294 |
Variable lease cost | 733 | 448 | 529 |
Total lease cost | 4,256 | 3,692 | 2,823 |
Operating cash flow information: | |||
Cash paid for amounts included in the measurement of lease liabilities | 3,348 | 3,543 | 2,923 |
Non-cash activity: | |||
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 6,346 | $ 3,923 | $ 12,107 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Right-of-use assets | $ 19,092 | $ 15,613 |
Current lease liabilities | 2,380 | 2,283 |
Non-current lease liabilities | $ 17,807 | $ 14,342 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other non-current assets | Other non-current assets |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other Liabilities, Current | Other Liabilities, Current |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other non-current liabilities | Other non-current liabilities |
Leases - Weighted Average Infor
Leases - Weighted Average Information (Details) | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 |
Leases [Abstract] | |||
Weighted average remaining lease term of operating leases (in years) | 7 years 1 month 6 days | 7 years 6 months | 7 years 4 months 24 days |
Weighted average discount rate of operating leases (as a percent) | 4.52% | 3.86% | 3.81% |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) $ in Thousands | Dec. 30, 2023 USD ($) |
Leases [Abstract] | |
Fiscal year 2024 | $ 3,606 |
Fiscal year 2025 | 3,537 |
Fiscal year 2026 | 3,175 |
Fiscal year 2027 | 2,789 |
Fiscal year 2028 | 2,690 |
Thereafter | 7,546 |
Total future minimum lease payments | 23,344 |
Less: imputed interest | (3,157) |
Total lease liabilities | $ 20,187 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Retirement Benefits [Abstract] | |||
Matching contributions | $ 1.1 | $ 0.9 | $ 0.7 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Plan (Details) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 15.6 | $ 4.2 | $ 9.6 |
Share-based payment arrangement, forfeited | 1.3 | 6.6 | |
Intrinsic value of stock options | 0.4 | $ 1.1 | $ 0.6 |
Stock-based compensation expense, unrecognized | $ 0.3 | ||
Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense, recognition period (in years) | 10 months 24 days | ||
2015 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Plan expiration period (in years) | 10 years | ||
Shares available for future grants (in shares) | 1.4 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 30, 2023 | Dec. 31, 2022 | |
Number of Shares (in thousands) | ||
Options outstanding at beginning of period (in shares) | 33 | |
Options granted (in shares) | 0 | |
Options exercised (in shares) | (5) | |
Options forfeited (in shares) | 0 | |
Options outstanding at end of period (in shares) | 28 | 33 |
Options exercisable (in shares) | 17 | |
Weighted Average Exercise Price | ||
Weighted average exercise price of options outstanding at beginning of period (in usd per share) | $ 112.28 | |
Weighted average exercise price of options granted (in usd per share) | 0 | |
Weighted average exercise price of options exercised (in usd per share) | 79.85 | |
Weighted average exercise price of options forfeited (in usd per share) | 0 | |
Weighted average exercise price of options outstanding at end of period (in usd per share) | 117.77 | $ 112.28 |
Weighted average exercise price of options exercisable (in usd per share) | $ 104.31 | |
Aggregate Intrinsic Value (in thousands) | ||
Aggregate intrinsic value of options outstanding | $ 3,940 | $ 884 |
Aggregate intrinsic value of options exercisable | $ 2,521 | |
Weighted Average Remaining Term (in years) | ||
Weighted average remaining term of options outstanding (in years) | 7 years 4 months 24 days | 8 years 2 months 12 days |
Weighted average remaining term of options exercisable (in years) | 7 years |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Restricted Stock Units (Details) - Restricted Stock Units - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Award vesting period (in years) | 3 years | ||
Unrecognized compensation expense related to unvested RSUs | $ 7.7 | ||
Stock-based compensation expense, recognition period (in years) | 1 year 9 months 18 days | ||
Weighted average fair value at grant date, granted (in usd per share) | $ 174.57 | $ 116.30 | $ 138.38 |
Fair value of restricted stock units, vested | $ 2.1 | $ 2 | $ 1.9 |
Number of Shares (in thousands) | |||
Outstanding at beginning of period (in shares) | 63 | ||
Units granted (in shares) | 49 | ||
Units vested (in shares) | (17) | ||
Units forfeited (in shares) | (16) | ||
Outstanding at end of period (in shares) | 79 | 63 | |
Weighted Average Grant Date Fair Value | |||
Weighted average fair value at grant date at beginning of period (in usd per share) | $ 120.12 | ||
Weighted average fair value at grant date, granted (in usd per share) | 174.57 | $ 116.30 | $ 138.38 |
Weighted average fair value at grant date, vested (in usd per share) | 124.79 | ||
Weighted average fair value at grant date, forfeited (in usd per share) | 152.99 | ||
Weighted average fair value at grant date at end of period (in usd per share) | $ 146.03 | $ 120.12 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Performance Stock Units (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Performance Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Performance units, service period (in years) | 3 years | ||
Unrecognized compensation expense related to unvested RSUs | $ 14.2 | ||
Stock-based compensation expense, recognition period (in years) | 1 year 4 months 24 days | ||
Weighted average fair value at grant date, granted (in usd per share) | $ 145.15 | $ 127.20 | $ 96.16 |
Fair value of performance stock units, vested | $ 3.1 | $ 1.7 | $ 6.6 |
Number of Shares (in thousands) | |||
Outstanding at beginning of period (in shares) | 65 | ||
Units granted (in shares) | 59 | ||
Units vested (in shares) | (35) | ||
Units forfeited (in shares) | (8) | ||
Outstanding at end of period (in shares) | 81 | 65 | |
Weighted Average Grant Date Fair Value | |||
Weighted average fair value at grant date at beginning of period (in usd per share) | $ 122.75 | ||
Weighted average fair value at grant date, granted (in usd per share) | 145.15 | $ 127.20 | $ 96.16 |
Weighted average fair value at grant date, vested (in usd per share) | 88 | ||
Weighted average fair value at grant date, forfeited (in usd per share) | 154.28 | ||
Weighted average fair value at grant date at end of period (in usd per share) | $ 151.03 | $ 122.75 | |
Performance Stock Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
PSU vesting percentage (as a percent) | 0% | ||
Performance Stock Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
PSU vesting percentage (as a percent) | 250% | ||
Incremental Performance Stock Units | |||
Number of Shares (in thousands) | |||
Units vested (in shares) | (18) |
Restaurant Transactions - Narra
Restaurant Transactions - Narrative (Details) - restaurant | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 |
Business Combination and Asset Acquisition [Abstract] | |||
Number of restaurants acquired from franchisees | 3 | 3 | 3 |
Restaurant Transactions - Alloc
Restaurant Transactions - Allocation of Acquisition Purchase Price (Details) - USD ($) $ in Thousands | Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 |
Business Acquisition [Line Items] | |||
Goodwill | $ 67,708 | $ 62,514 | $ 56,877 |
Restaurant Transactions | |||
Business Acquisition [Line Items] | |||
Working capital | 0 | 17 | 61 |
Property and equipment | 217 | 155 | 148 |
Reacquired franchise rights | 5,330 | 2,000 | 1,400 |
Goodwill | 5,285 | 5,637 | 3,267 |
Total purchase price | $ 10,832 | $ 7,809 | $ 4,876 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2023 | Dec. 31, 2022 | Dec. 25, 2021 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 460,055 | $ 357,521 | $ 282,502 |
Average franchise license term (in years) | 10 years | ||
Deferred revenue not yet being amortized | $ 9,300 | 7,700 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-12-31 | |||
Disaggregation of Revenue [Line Items] | |||
Remaining amortization period for deferred revenue related to open restaurants (in years) | 7 years 1 month 6 days | ||
Royalty revenue | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 186,455 | 142,900 | 119,396 |
Advertising fees | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 157,138 | 119,011 | 81,529 |
Franchise fees | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 5,064 | $ 4,357 | $ 4,020 |