Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | ||
Jun. 27, 2019 | Aug. 25, 2019 | Aug. 02, 2019 | |
Document Information [Line Items] | |||
Document Type | 10-Q | ||
Document Period End Date | Jun. 27, 2019 | ||
Entity Registrant Name | MARCUS CORP | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Central Index Key | 0000062234 | ||
Current Fiscal Year End Date | --12-26 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | Q2 | ||
Amendment Flag | false | ||
Trading Symbol | MCS | ||
Common Stock [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 22,983,920 | ||
Class B Common Stock [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 7,935,872 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 27, 2019 | Dec. 27, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 11,693 | $ 17,114 |
Restricted cash | 4,786 | 4,813 |
Accounts and notes receivable, net of reserves of $302 and $361, respectively | 28,072 | 25,684 |
Refundable income taxes | 404 | 5,983 |
Other current assets | 18,904 | 15,355 |
Total current assets | 63,859 | 68,949 |
Property and equipment: | ||
Land and improvements | 150,271 | 150,122 |
Buildings and improvements | 753,185 | 745,886 |
Leasehold improvements | 166,343 | 98,885 |
Furniture, fixtures and equipment | 364,890 | 314,875 |
Finance lease right-of-use assets | 74,259 | 72,631 |
Construction in progress | 7,280 | 12,513 |
Total property and equipment | 1,516,228 | 1,394,912 |
Less accumulated depreciation and amortization | 581,040 | 554,869 |
Net property and equipment | 935,188 | 840,043 |
Operating lease right-of-use assets | 234,064 | 0 |
Other assets: | ||
Investments in joint ventures | 3,701 | 4,069 |
Goodwill | 74,821 | 43,170 |
Other | 40,046 | 33,100 |
Total other assets | 118,568 | 80,339 |
TOTAL ASSETS | 1,351,679 | 989,331 |
Current liabilities: | ||
Accounts payable | 47,231 | 37,452 |
Taxes other than income taxes | 20,278 | 18,743 |
Accrued compensation | 15,295 | 17,547 |
Other accrued liabilities | 52,810 | 59,645 |
Current portion of finance lease obligations | 3,983 | 5,912 |
Current portion of operating lease obligations | 12,967 | 0 |
Current maturities of long-term debt | 9,945 | 9,957 |
Total current liabilities | 162,509 | 149,256 |
Finance lease obligations | 21,990 | 22,208 |
Operating lease obligations | 225,762 | 0 |
Long-term debt | 239,950 | 228,863 |
Deferred income taxes | 41,691 | 41,977 |
Deferred compensation and other | 47,435 | 56,908 |
Equity: | ||
Preferred Stock, $1 par; authorized 1,000,000 shares; none issued | ||
Capital in excess of par | 144,056 | 63,830 |
Retained earnings | 449,458 | 439,178 |
Accumulated other comprehensive loss | (7,408) | (6,758) |
Stockholders' Equity before Treasury Stock | 617,296 | 527,440 |
Less cost of Common Stock in treasury (281,900 shares at June 27, 2019 and 2,839,079 shares at December 27, 2018) | (5,074) | (37,431) |
Total shareholders' equity attributable to The Marcus Corporation | 612,222 | 490,009 |
Noncontrolling interest | 120 | 110 |
Total equity | 612,342 | 490,119 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 1,351,679 | 989,331 |
Common Stock [Member] | ||
Equity: | ||
Common Stock, Value | 23,254 | 22,843 |
Total equity | 23,254 | 22,843 |
Class B Common Stock [Member] | ||
Equity: | ||
Common Stock, Value | 7,936 | 8,347 |
Total equity | $ 7,936 | $ 8,347 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 27, 2019 | Dec. 27, 2018 |
Accounts and notes receivable, reserves | $ 302 | $ 361 |
Preferred Stock, par (in dollars per share) | $ 1 | $ 1 |
Preferred Stock, authorized | 1,000,000 | 1,000,000 |
Preferred Stock, issued | 0 | 0 |
Cost of Common Stock in treasury, shares | 281,900 | 2,839,079 |
Common Stock [Member] | ||
Common Stock, par (in dollars per share) | $ 1 | $ 1 |
Common Stock, authorized | 50,000,000 | 50,000,000 |
Common Stock, issued | 23,253,641 | 22,843,096 |
Class B Common Stock [Member] | ||
Common Stock, par (in dollars per share) | $ 1 | $ 1 |
Common Stock, authorized | 33,000,000 | 33,000,000 |
Common Stock, issued | 7,935,872 | 8,346,417 |
Common Stock, outstanding | 7,935,872 | 8,346,417 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | ||
Revenues: | |||||
Revenues | $ 220,317 | $ 184,382 | $ 381,991 | $ 344,801 | |
Cost reimbursements | 12,183 | 8,916 | 20,548 | 16,688 | |
Total revenues | 232,500 | 193,298 | 402,539 | 361,489 | |
Costs and expenses: | |||||
Advertising and marketing | 6,101 | 6,025 | 11,011 | 11,139 | |
Administrative | 18,950 | 18,558 | 36,809 | 35,840 | |
Depreciation and amortization | 18,273 | 14,426 | 34,258 | 28,330 | |
Rent | 6,878 | 2,585 | 12,281 | 5,536 | |
Property taxes | 5,468 | 4,779 | 10,861 | 9,993 | |
Other operating expenses | 10,719 | 9,307 | 21,602 | 18,063 | |
Reimbursed costs | 12,183 | 8,916 | 20,548 | 16,688 | |
Total costs and expenses | 205,025 | 164,191 | 370,114 | 315,366 | |
Operating income | 27,475 | 29,107 | 32,425 | 46,123 | |
Other income (expense): | |||||
Investment income (loss) | 175 | 27 | 648 | (9) | |
Interest expense | (3,093) | (3,511) | (6,152) | (6,820) | |
Other expense | (480) | (496) | (960) | (992) | |
Loss on disposition of property, equipment and other assets | (147) | (408) | (140) | (408) | |
Equity earnings (loss) from unconsolidated joint ventures, net | (84) | 200 | (168) | 252 | |
Nonoperating Income (Expense), Total | (3,629) | (4,188) | (6,772) | (7,977) | |
Earnings before income taxes | 23,846 | 24,919 | 25,653 | 38,146 | |
Income taxes | 5,609 | 6,207 | 5,622 | 9,628 | |
Net earnings | 18,237 | 18,712 | 20,031 | 28,518 | |
Net earnings attributable to noncontrolling interests | 171 | 93 | 105 | 78 | |
Net earnings attributable to The Marcus Corporation | 18,066 | 18,619 | 19,926 | 28,440 | |
Theatre admissions | |||||
Revenues: | |||||
Revenue from Contract with Customer, Including Assessed Tax | 83,055 | 69,607 | 142,024 | 132,613 | |
Rooms | |||||
Revenues: | |||||
Revenue from Contract with Customer, Including Assessed Tax | 28,194 | 29,118 | 47,132 | 49,789 | |
Costs and expenses: | |||||
Cost of Goods and Services Sold | 10,309 | 10,567 | 19,344 | 20,068 | |
Theatre concessions | |||||
Revenues: | |||||
Revenue from Contract with Customer, Including Assessed Tax | 67,920 | 46,798 | 115,075 | 88,211 | |
Costs and expenses: | |||||
Cost of Goods and Services Sold | 25,049 | 12,976 | 42,318 | 24,937 | |
Food and beverage | |||||
Revenues: | |||||
Revenue from Contract with Customer, Including Assessed Tax | 18,615 | 18,836 | 34,398 | 34,639 | |
Costs and expenses: | |||||
Cost of Goods and Services Sold | 14,902 | 14,899 | 28,511 | 28,964 | |
Other revenues | |||||
Revenues: | |||||
Revenue from Contract with Customer, Including Assessed Tax | 22,533 | [1] | 20,023 | 43,362 | 39,549 |
Theatre operations | |||||
Costs and expenses: | |||||
Cost of Goods and Services Sold | $ 76,193 | $ 61,153 | $ 132,571 | $ 115,808 | |
Common Stock [Member] | |||||
Net earnings per share - basic: | |||||
Common Stock | $ 0.60 | $ 0.68 | $ 0.68 | $ 1.05 | |
Net earnings per share - diluted: | |||||
Common Stock | 0.58 | 0.65 | 0.64 | 1 | |
Class B Common Stock [Member] | |||||
Net earnings per share - basic: | |||||
Common Stock | 0.54 | 0.62 | 0.59 | 0.95 | |
Net earnings per share - diluted: | |||||
Common Stock | $ 0.54 | $ 0.61 | $ 0.59 | $ 0.93 | |
[1] | Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | |
Consolidated Statements of Comprehensive Income | ||||
Net earnings | $ 18,237 | $ 18,712 | $ 20,031 | $ 28,518 |
Other comprehensive income (loss), net of tax: | ||||
Amortization of the net actuarial loss and prior service credit related to the pension, net of tax effect of $29, $59, $42 and $83, respectively | 80 | 113 | 159 | 227 |
Fair market value adjustment of interest rate swap, net of tax (benefit) effect of $(163), $(305), $63 and $0, respectively | (444) | 169 | (830) | (1) |
Reclassification adjustment on interest rate swap included in interest expense, net of tax effect of $4, $8, $22 and $32, respectively | 11 | 62 | 21 | 88 |
Other comprehensive income (loss) | (353) | 344 | (650) | 314 |
Comprehensive income | 17,884 | 19,056 | 19,381 | 28,832 |
Comprehensive income attributable to noncontrolling interests | 171 | 93 | 105 | 78 |
Comprehensive income attributable to The Marcus Corporation | $ 17,713 | $ 18,963 | $ 19,276 | $ 28,754 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | |
Consolidated Statements of Comprehensive Income | ||||
Amortization of the net actuarial loss and prior service credit related to the pension, net of tax effect | $ 29 | $ 42 | $ 59 | $ 83 |
Fair market value adjustment of interest rate swap, net of tax benefit | (163) | 63 | (305) | 0 |
Reclassification adjustment on interest rate swap included in interest expense, net of tax effect | $ 4 | $ 22 | $ 8 | $ 32 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 27, 2019 | Jun. 28, 2018 | |
OPERATING ACTIVITIES: | ||
Net earnings | $ 20,031 | $ 28,518 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Losses (earnings) on investments in joint ventures | 168 | (253) |
Distributions from joint ventures | 200 | 64 |
Loss on disposition of property, equipment and other assets | 140 | 408 |
Amortization of favorable lease right | 167 | |
Depreciation and amortization | 34,258 | 28,330 |
Amortization of debt issuance costs | 179 | 145 |
Share-based compensation | 1,726 | 1,311 |
Deferred income taxes | (2) | 2 |
Deferred compensation and other | 250 | 2,875 |
Contribution of the Company's stock to savings and profit-sharing plan | 1,181 | 1,130 |
Changes in operating assets and liabilities: | ||
Accounts and notes receivable | (2,388) | (3,762) |
Other current assets | 6,866 | (960) |
Accounts payable | 5,018 | (6,001) |
Income taxes | 5,579 | 12,880 |
Taxes other than income taxes | 1,356 | (102) |
Accrued compensation | (2,252) | (1,994) |
Other accrued liabilities | (12,580) | (7,315) |
Total adjustments | 39,699 | 26,925 |
Net cash provided by operating activities | 59,730 | 55,443 |
INVESTING ACTIVITIES: | ||
Capital expenditures | (30,460) | (32,245) |
Acquisition of theatres, net of cash acquired and working capital assumed | (29,626) | |
Proceeds from disposals of property, equipment and other assets | 16 | 76 |
Capital contribution in joint venture | (294) | |
Other investing activities | (5,716) | (1,031) |
Net cash used in investing activities | (65,786) | (33,494) |
Debt transactions: | ||
Proceeds from borrowings on revolving credit facility | 162,000 | 105,000 |
Repayment of borrowings on revolving credit facility | (127,000) | (110,000) |
Principal payments on long-term debt | (24,032) | (11,516) |
Principal payments on finance lease obligations | (1,207) | (901) |
Equity transactions: | ||
Treasury stock transactions, except for stock options | (316) | (664) |
Exercise of stock options | 904 | 2,104 |
Dividends paid | (9,646) | (8,158) |
Distributions to noncontrolling interest | (95) | (19) |
Net cash provided by (used in) financing activities | 608 | (24,154) |
Net decrease in cash, cash equivalents and restricted cash | (5,448) | (2,205) |
Cash, cash equivalents and restricted cash at beginning of period | 21,927 | 20,747 |
Cash, cash equivalents and restricted cash at end of period | 16,479 | 18,542 |
Supplemental Information: | ||
Interest paid, net of amounts capitalized | 6,032 | 6,507 |
Income taxes paid (refunded) | 44 | (3,205) |
Change in accounts payable for additions to property, equipment and other assets | $ 4,761 | $ (7,836) |
General
General | 6 Months Ended |
Jun. 27, 2019 | |
General | |
General | 1. General Basis of Presentation - The unaudited consolidated financial statements for the 13 and 26 weeks ended June 27, 2019 and June 28, 2018 have been prepared by the Company. In the opinion of management, all adjustments, consisting of normal recurring adjustments necessary to present fairly the unaudited interim financial information at June 27, 2019, and for all periods presented, have been made. The results of operations during the interim periods are not necessarily indicative of the results of operations for the entire year or other interim periods. However, the unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10‑K for the year ended December 27, 2018. Accounting Policies - Refer to the Company’s audited consolidated financial statements (including footnotes) for the fiscal year ended December 27, 2018, contained in the Company’s Annual Report on Form 10‑K for such year, for a description of the Company’s accounting policies. During the 26 weeks ended June 27, 2019, there were no significant changes made to the Company’s significant accounting policies other than the changes attributable to the adoption of the Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No. 2016‑02, Leases (Topic 842) , which was adopted on December 28, 2018. The lease policy updates are applied prospectively in the Company’s financial statements from December 28, 2018 forward. Reported financial information for the historical comparable period was not revised and continues to be reported under the accounting standards in effect during the historical periods. See Note 3 for further discussion. Depreciation and Amortization - Depreciation and amortization of property and equipment are provided using the straight-line method over the shorter of the estimated useful lives of the assets or any related lease terms. Depreciation expense totaled $18,284,000 and $34,239,000 for the 13 and 26 weeks ended June 27, 2019, respectively, and $14,445,000 and $28,481,000 for the 13 and 26 weeks ended June 28, 2018, respectively. Earnings Per Share - Net earnings per share (EPS) of Common Stock and Class B Common Stock is computed using the two class method. Basic net earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding. Diluted net earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding, adjusted for the effect of dilutive stock options using the treasury method. Convertible Class B Common Stock is reflected on an if-converted basis. The computation of the diluted net earnings per share of Common Stock assumes the conversion of Class B Common Stock, while the diluted net earnings per share of Class B Common Stock does not assume the conversion of those shares. Holders of Common Stock are entitled to cash dividends per share equal to 110% of all dividends declared and paid on each share of Class B Common Stock. As such, the undistributed earnings for each period are allocated based on the proportionate share of entitled cash dividends. The computation of diluted net earnings per share of Common Stock assumes the conversion of Class B Common Stock and, as such, the undistributed earnings are equal to net earnings for that computation. The following table illustrates the computation of Common Stock and Class B Common Stock basic and diluted net earnings per share for net earnings and provides a reconciliation of the number of weighted-average basic and diluted shares outstanding: 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 27, 2019 June 28, 2018 June 27, 2019 June 28, 2018 (in thousands, except per share data) Numerator: Net earnings attributable to The Marcus Corporation $ 18,066 $ 18,619 $ 19,926 $ 28,440 Denominator: Denominator for basic EPS 30,897 28,010 30,390 27,952 Effect of dilutive employee stock options 504 611 558 582 Denominator for diluted EPS 31,401 28,621 30,948 28,534 Net earnings per share - basic: Common Stock $ 0.60 $ 0.68 $ 0.68 $ 1.05 Class B Common Stock $ 0.54 $ 0.62 $ 0.59 $ 0.95 Net earnings per share - diluted: Common Stock $ 0.58 $ 0.65 $ 0.64 $ 1.00 Class B Common Stock $ 0.54 $ 0.61 $ 0.59 $ 0.93 Shareholders’ Equity - Activity impacting total shareholders’ equity attributable to The Marcus Corporation and noncontrolling interests for the 13 and 26 weeks ended June 27, 2019 and June 28, 2018 was as follows (in thousands, except per share data): Shareholders’ Equity Accumulated Attributable Class B Capital Other to The Non- Common Common in Excess Retained Comprehensive Treasury Marcus controlling Total Stock Stock of Par Earnings Loss Stock Corporation Interests Equity BALANCES AT DECEMBER 27, 2018 $ 22,843 $ 8,347 $ 63,830 $ 439,178 $ (6,758) $ (37,431) $ 490,009 $ 110 $ 490,119 Cash Dividends: $.15 Class B Common Stock — — — (1,183) — — (1,183) — (1,183) $.16 Common Stock — — — (3,633) — — (3,633) — (3,633) Exercise of stock options — — (78) — — 532 454 — 454 Purchase of treasury stock — — — — — (428) (428) — (428) Savings and profit-sharing contribution — — 810 — — 371 1,181 — 1,181 Reissuance of treasury stock — — 31 — — 16 47 — 47 Issuance of non-vested stock — — (127) — — 127 — — — Shared-based compensation — — 777 — — — 777 — 777 Reissuance of treasury stock-acquisition — — 77,960 — — 31,237 109,197 — 109,197 Other — — (109) — — — (109) — (109) Conversions of Class B Common Stock 411 (411) — — — — — — — Distributions to noncontrolling interest — — — — — — — (60) (60) Comprehensive income (loss) — — — 1,860 (297) — 1,563 (66) 1,497 BALANCES AT MARCH 28, 2019 $ 23,254 $ 7,936 $ 143,094 $ 436,222 $ (7,055) $ (5,576) $ 597,875 $ (16) $ 597,859 Cash Dividends: $.15 Class B Common Stock — — — (1,155) — — (1,155) — (1,155) $.16 Common Stock — — — (3,675) — — (3,675) — (3,675) Exercise of stock options — — (27) — — 477 450 — 450 Purchase of treasury stock — — — — — (213) (213) — (213) Reissuance of treasury stock — — 182 — — 96 278 — 278 Issuance of non-vested stock — — (142) — — 142 — — — Shared-based compensation — — 949 — — — 949 — 949 Distributions to noncontrolling interest — — — — — — — (35) (35) Comprehensive income (loss) — — — 18,066 (353) — 17,713 171 17,884 BALANCES AT JUNE 27, 2019 $ 23,254 $ 7,936 $ 144,056 $ 449,458 $ (7,408) $ (5,074) $ 612,222 $ 120 $ 612,342 Shareholders’ Equity Accumulated Attributable Class B Capital Other to The Non- Common Common in Excess Retained Comprehensive Treasury Marcus controlling Total Stock Stock of Par Earnings Income (Loss) Stock Corporation Interests Equity BALANCES AT DECEMBER 28, 2017 $ 22,656 $ 8,534 $ 61,452 $ 403,206 $ (7,425) $ (43,399) $ 445,024 $ 100 $ 445,124 Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2016-01 — — — (11) 11 — — — — Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2018-02 — — — 1,574 (1,574) — — — — Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2014-09 — — — (2,568) — — (2,568) — (2,568) Cash Dividends: $.14 Class B Common Stock — — — (1,163) — — (1,163) — (1,163) $.15 Common Stock — — — (2,907) — — (2,907) — (2,907) Exercise of stock options — — (62) — — 991 929 — 929 Purchase of treasury stock — — — — — (453) (453) — (453) Savings and profit-sharing contribution — — 651 — — 479 1,130 — 1,130 Reissuance of treasury stock — — 26 — — 23 49 — 49 Issuance of non-vested stock — — (108) — — 108 — — — Shared-based compensation — — 596 — — — 596 — 596 Conversions of Class B Common Stock 8 (8) — — — — — — — Distributions to noncontrolling interest — — — — — — — (19) (19) Comprehensive income (loss) — — — 9,821 (30) — 9,791 (15) 9,776 BALANCES AT MARCH 29, 2018 $ 22,664 $ 8,526 $ 62,555 $ 407,952 $ (9,018) $ (42,251) $ 450,428 $ 66 $ 450,494 Cash Dividends: $.14 Class B Common Stock — — — (1,162) — — (1,162) — (1,162) $.15 Common Stock — — — (2,926) — — (2,926) — (2,926) Exercise of stock options — — (33) — — 1,207 1,174 — 1,174 Purchase of treasury stock — — — — — (496) (496) — (496) Reissuance of treasury stock — — 143 — — 93 236 — 236 Issuance of non-vested stock — — (127) — — 127 — — — Shared-based compensation — — 715 — — — 715 — 715 Conversions of Class B Common Stock 5 (5) — — — — — — — Comprehensive income (loss) — — — 18,619 344 — 18,963 93 19,056 BALANCES AT JUNE 28, 2018 $ 22,669 $ 8,521 $ 63,253 $ 422,483 $ (8,674) $ (41,320) $ 466,932 $ 159 $ 467,091 Accumulated Other Comprehensive Loss – Accumulated other comprehensive loss presented in the accompanying consolidated balance sheets consists of the following, all presented net of tax: June 27, December 27, 2019 2018 (in thousands) Unrecognized loss on interest rate swap agreements $ (958) $ (149) Net unrecognized actuarial loss for pension obligation (6,450) (6,609) $ (7,408) $ (6,758) Fair Value Measurements - Certain financial assets and liabilities are recorded at fair value in the consolidated financial statements. Some are measured on a recurring basis while others are measured on a non-recurring basis. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. A fair value measurement assumes that a transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The Company’s assets and liabilities measured at fair value are classified in one of the following categories: Level 1 - Assets or liabilities for which fair value is based on quoted prices in active markets for identical instruments as of the reporting date. At June 27, 2019 and December 27, 2018, respectively, the Company’s $6,028,000 and $5,302,000 of debt and equity securities were valued using Level 1 pricing inputs and were included in other current assets. Level 2 - Assets or liabilities for which fair value is based on pricing inputs that were either directly or indirectly observable as of the reporting date. At June 27, 2019 and December 27, 2018, respectively, the Company’s $1,311,000 and $205,000 liability related to the Company’s interest rate swap contracts was valued using Level 2 pricing inputs a nd was included in deferred compensation and other in the consolidated balance sheets. Level 3 - Assets or liabilities for which fair value is based on valuation models with significant unobservable pricing inputs and which result in the use of management estimates. At June 27, 2019 and December 27, 2018, none of the Company’s fair value measurements were valued using Level 3 pricing inputs. See Note 2 for further discussion on Level 3 assumptions used in regard to the acquisition. Defined Benefit Plan - The components of the net periodic pension cost of the Company’s unfunded nonqualified, defined-benefit plan are as follows: 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 27, 2019 June 28, 2018 June 27, 2019 June 28, 2018 (in thousands) Service cost $ 209 $ 231 $ 418 $ 463 Interest cost 371 341 742 682 Net amortization of prior service cost and actuarial loss 109 155 218 310 Net periodic pension cost $ 689 $ 727 $ 1,378 $ 1,455 Service cost is included in Administrative expense while all other components are recorded within Other expense outside of operating income in the consolidated statements of earnings. Revenue Recognition – The disaggregation of revenues by business segment for the 13 and 26 weeks ended June 27, 2019 is as follows (in thousands): 13 Weeks Ended June 27, 2019 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 83,055 $ — $ — $ 83,055 Rooms — 28,194 — 28,194 Theatre concessions 67,920 — — 67,920 Food and beverage — 18,615 — 18,615 Other revenues (1) 11,175 11,216 142 22,533 Cost reimbursements 237 11,946 — 12,183 Total revenues $ 162,387 $ 69,971 $ 142 $ 232,500 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. 26 Weeks Ended June 27, 2019 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 142,024 $ — $ — $ 142,024 Rooms — 47,132 — 47,132 Theatre concessions 115,075 — — 115,075 Food and beverage — 34,398 — 34,398 Other revenues (1) 19,744 23,383 235 43,362 Cost reimbursements 429 20,119 — 20,548 Total revenues $ 277,272 $ 125,032 $ 235 $ 402,539 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. The disaggregation of revenues by business segment for the 13 and 26 weeks ended June 28, 2018 is as follows (in thousands): 13 Weeks Ended June 28, 2018 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 69,607 $ — $ — $ 69,607 Rooms — 29,118 — 29,118 Theatre concessions 46,798 — — 46,798 Food and beverage — 18,836 — 18,836 Other revenues (1) 8,661 11,230 132 20,023 Cost reimbursements 387 8,529 — 8,916 Total revenues $ 125,453 $ 67,713 $ 132 $ 193,298 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. 26 Weeks Ended June 28, 2018 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 132,613 $ — $ — $ 132,613 Rooms — 49,789 — 49,789 Theatre concessions 88,211 — — 88,211 Food and beverage — 34,639 — 34,639 Other revenues (1) 16,698 22,631 220 39,549 Cost reimbursements 866 15,822 — 16,688 Total revenues $ 238,388 $ 122,881 $ 220 $ 361,489 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. The Company had deferred revenue from contracts with customers of $35,135,000 and $37,048,000 as of June 27, 2019 and December 27, 2018, respectively. The Company had no contract assets as of June 27, 2019 and December 27, 2018. During the 13 and 26 weeks ended June 27, 2019, the Company recognized revenue of $4,522,000 and $14,705,000, respectively, that was included in deferred revenues as of December 27, 2018. The majority of the company’s deferred revenue relates to non-redeemed gift cards, advanced ticket sales and the company’s loyalty programs. As of June 27, 2019, the amount of transaction price allocated to the remaining performance obligations under the Company’s advanced ticket sales was $4,462,000 and is reflected in the Company consolidated balance sheet as part of deferred revenues, which is included in other accrued liabilities. The Company recognizes revenue as the tickets are redeemed, which is expected to occur within the next two years. As of June 27, 2019, the amount of transaction price allocated to the remaining performance obligations related to the amount of Hotels and Resorts non-redeemed gift cards was $2,339,000 and is reflected in the Company’s consolidated balance sheet as part of deferred revenues, which is included in other accrued liabilities. The Company recognizes revenue as the gift cards are redeemed, which is expected to occur within the next two years. The majority of the Company’s revenue is recognized in less than one year from the original contract. New Accounting Pronouncements – On December 28, 2018, the Company adopted ASU No. 2016‑02, Leases (Topic 842) , which is intended to improve financial reporting related to leasing transactions. ASC 842 requires a lessee to recognize on the balance sheet assets and liabilities for rights and obligations created by leased assets with lease terms of more than 12 months. The new guidance also requires disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from the leases. See Note 3 for further discussion. In January 2017, the FASB issued ASU No. 2017‑04, Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment , which eliminates Step 2 of the goodwill impairment test that had required a hypothetical purchase price allocation. Rather, entities should apply the same impairment assessment to all reporting units and recognize an impairment loss for the amount by which a reporting unit’s carrying amount exceeds its fair value, without exceeding the total amount of goodwill allocated to that reporting unit. Entities will continue to have the option to perform a qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. ASU No. 2017‑04 is effective for the Company in fiscal 2020 and must be applied prospectively. The Company does not believe the new standard will have a material effect on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018‑14, Compensation—Retirement Benefits—Defined Benefit Plans—General , designed to add, remove and clarify disclosure requirements related to defined benefit pension and other postretirement plans. ASU No. 2018‑14 is effective for the Company in fiscal 2021 and early application is permitted. The Company is evaluating the effect that the guidance will have on its financial statement disclosures. In August 2018, the FASB issued ASU No. 2018‑13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, (ASU No. 2018‑13) . The purpose of ASU No. 2018‑13 is to improve the disclosures related to fair value measurements in the financial statements. The improvements include the removal, modification and addition of certain disclosure requirements primarily related to Level 3 fair value measurements. ASU No. 2018‑13 is effective for the Company in fiscal 2020. The amendments in ASU No. 2018‑13 should be applied prospectively. The Company does not expect ASU No. 2018‑13 to have a significant impact on its consolidated financial statements. |
Acquisition
Acquisition | 6 Months Ended |
Jun. 27, 2019 | |
Acquisition | |
Acquisition | 2. Acquisition On February 1, 2019, the Company acquired 22 dine-in theatres with 208 screens located in nine Southern and Eastern states from VSS-Southern Theatres LLC (Movie Tavern) for a total purchase price of $138,856,000, consisting of $30,000,000 in cash, subject to certain adjustments, and 2,450,000 shares of the company’s Common Stock with a value of $109,197,000, based on the Company’s closing share price as of January 31, 2019. Acquisition costs incurred as a result of the Movie Tavern acquisition were approximately $1,223,000 and $1,507,000 during fiscal 2019 and fiscal 2018, respectively, and were expensed as incurred and included in administrative expense in the consolidated statements of earnings. The preliminary purchase price allocation reflected in the Company’s consolidated balance sheet on the acquisition date is as follows (in thousands): Other current assets $ 4,539 Property and equipment 95,848 Operating lease right-of-use-assets 159,541 Other (long-term assets) 9,710 Goodwill 31,697 Taxes other than income (179) Other accrued liabilities (3,125) Operating lease obligations (159,175) Total $ 138,856 The preliminary fair value measurement of tangible and intangible assets and liabilities was based on significant inputs not observable in the market and thus represent Level 3 measurements within the fair value measurement hierarchy. Level 3 fair market values were determined using a variety of information, including estimated future cash flows and market comparables. The Company is in the process of completing the purchase price allocation and expects to have it finalized within the 12 month measurement period. |
Leases
Leases | 6 Months Ended |
Jun. 27, 2019 | |
Leases | |
Leases | 3. Leases The Company determines if an arrangement is a lease at inception. The Company evaluates each lease for classification as either a finance lease or an operating lease according to accounting guidance ASU No. 2016‑02, Leases (Topic 842) . The Company performs this evaluation at the inception of the lease and when a modification is made to a lease. The Company leases real estate and equipment with lease terms of one year to 45 years, some of which include options to extend and/or terminate the lease. The exercise of lease renewal options is done at the Company’s sole discretion. When deemed reasonably certain of exercise, the renewal options are included in the determination of the lease term and related right-of-use asset and lease liability. The depreciable life of the asset is limited to the expected term. The Company’s lease agreements do not contain any residual value guarantees or any restrictions or covenants. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease right-of-use assets and labilities are recognized at commencement date of the lease based on the present value of lease payments over the lease term. When readily determinable, the Company uses the implicit rate in the lease in determining the present value of lease payments. When the lease does not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date, including the fixed rate the Company could borrow for a similar amount, over a similar lease term with similar collateral. The Company recognizes right-of-use assets for all assets subject to operating leases in an amount equal to the operating lease liabilities, adjusted for the balances of long-term prepaid rent, favorable lease intangible assets, deferred lease expense, unfavorable lease liabilities and deferred lease incentive liabilities. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. The majority of the Company’s lease agreements include fixed rental payments. For those leases with variable payments based on increases in an index subsequent to lease commencement, such payments are recognized as variable lease expense as they occur. Variable lease payments that do not depend on an index or rate, including those that depend on the Company’s performance or use of the underlying asset, are also expensed as incurred. The Company adopted ASC 842 on the first day of fiscal 2019 using the modified retrospective approach. Under this method, the Company was allowed to initially apply the new lease standard at the adoption date and recognize the assets and liabilities in the period of adoption. As such, upon adoption, no adjustments were made to prior period financial information or disclosures and the new lease standard did not result in a cumulative effect adjustment to retained earnings. Finance lease accounting remained substantially unchanged. The adoption of ASC 842 had the following effect on the Company’s financial statements as follows (all relating to operating lease right-of-use assets and obligations): Balance at ASC 842 Balance at December 27, 2018 Adjustments December 28, 2018 Assets (in thousands) Other current assets $ 15,355 $ (690) $ 14,665 Operating lease right-of-use assets — 76,178 76,178 Other assets (long term) 33,100 (8,868) 24,232 Liabilities Other accrued liabilities 59,645 (4,396) 55,249 Current portion of operating lease obligations — 5,909 5,909 Operating lease obligations — 75,608 75,608 Deferred compensation and other 56,908 (10,501) 46,407 As part of the Company’s adoption of ASC 842, the Company elected the following practical expedients: i) to forego reassessment of its prior conclusion related to lease identification, lease classification and initial direct costs, ii) to not separate lease and non-lease components for all of its leases, and iii) to make a policy election not to apply the lease recognition requirements for short-term leases. As a result, the Company does not recognize right-of use assets or lease liabilities for short-term leases that qualify for the policy election (those with an initial term of 12 months or less which do not include a purchase or renewal option which is reasonably certain to be exercised), but will recognize these lease payments as lease costs on a straight-line basis over the lease term. Total lease cost consists of the following: 13 Weeks 26 Weeks Ended Ended Lease Cost Classification June 27, 2019 June 27, 2019 (in thousands) Finance lease costs: Amortization of finance lease assets Depreciation and amortization $ 971 $ 1,862 Interest on lease liabilities Interest expense 292 586 $ 1,263 $ 2,448 Operating lease costs: Operating lease costs Rent expense $ 6,326 $ 11,366 Variable lease cost Rent expense 542 795 Short-term lease cost Rent expense 10 120 $ 6,878 $ 12,281 26 Weeks Ended Other Information June 27, 2019 Cash paid for amounts included in the measurement of lease liabilities: Financing cash flows from finance leases $ 1,207 Operating cash flows from finance leases 586 Operating cash flows from operating leases 11,618 Right of use assets obtained in exchange for new lease obligations: Finance lease liabilities 1,627 Operating lease liabilities, including from acquisitions 164,228 June 27, 2019 (in thousands) Finance leases: Property and equipment – gross $ 74,259 Accumulated depreciation and amortization (49,815) Property and equipment - net $ 24,444 Lease Term and Discount Rate June 27, 2019 Weighted-average remaining lease terms: Finance leases 9 years Operating leases 15 years Weighted-average discount rates: Finance leases 4.77 % Operating leases 4.64 % Maturities of lease liabilities as of June 27, 2019 are as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2019 (excluding the 26 weeks ended June 27, 2019) $ 11,170 $ 3,366 2020 25,160 3,560 2021 24,521 2,968 2022 24,949 2,922 2023 23,736 2,823 2024 and thereafter 222,503 16,948 Total lease payments 332,039 32,587 Less: amount representing interest (93,310) (6,614) Total lease liabilities $ 238,729 $ 25,973 Aggregate minimum lease commitments as of December 27, 2018 under Accounting Standard Codification Topic 840 are as follows (in thousands): Fiscal Year Operating Leases Capital Leases 2019 $ 11,317 $ 3,073 2020 10,169 2,978 2021 9,670 2,679 2022 9,910 2,718 2023 9,038 2,718 2024 and thereafter 80,523 16,940 Total minimum lease payments $ 130,627 31,106 Less: amount representing interest (6,978) Total present value of minimum capital lease payments $ 24,128 In fiscal 2018, the Company entered into a build-to-suit lease arrangement in which the Company is responsible for the construction of a new leased theatre and for paying construction costs during development. Construction costs will be reimbursed by the landlord up to an agreed upon amount. During construction, the Company is deemed to not have control of the assets or the leased premises and has recorded the development expenditures in other assets on the consolidated balance sheet. The lease will commence when the Company has access to the right-of-use asset, which is expected to be upon project completion. Digital Cinema Projection Systems - During fiscal 2012, the Company entered into a master licensing agreement with CDF2 Holdings, LLC, a subsidiary of Cinedigm Digital Cinema Corp (CDF2), whereby CDF2 purchased on the Company’s behalf, and then deployed and licensed back to the Company, digital cinema projection systems (the “systems”) for use by the Company in its theatres. As of June 27, 2019, 642 of the Company’s screens were utilizing the systems under a 10‑year master licensing agreement with CDF2. Included in Finance lease right-of-use assets is $45,510,000 related to the digital systems as of June 27, 2019 and December 27, 2018, which is being amortized over the remaining estimated useful life of the assets. Accumulated amortization of the digital systems was $43,735,000 and $40,647,000 as of June 27, 2019 and December 27, 2018, respectively. Under the terms of the master licensing agreement, the Company made an initial one-time payment to CDF2. The Company expects that the balance of CDF2’s costs to deploy the systems will be covered primarily through the payment of virtual print fees (VPF’s) from film distributors to CDF2 each time a digital movie is booked on one of the systems deployed on a Company screen. The Company agreed to make an average number of bookings of eligible digital movies on each screen on which a licensed system has been deployed to provide for a minimum level of VPF’s paid by distributors (standard booking commitment) to CDF2. To the extent the VPF’s paid by distributors are less than the standard booking commitment, the Company must make a shortfall payment to CDF2. Based upon the Company’s historical booking patterns, the Company does not expect to make any shortfall payments during the life of the agreement. Accounting Standards Codification No. 842, Leases , requires that the Company consider the entire amount of the standard booking commitment minimum lease payments for purposes of determining the finance lease obligation. The maximum amount per year that the Company could be required to pay is approximately $6,163,000 until the obligation is fully satisfied. The Company’s finance lease obligation is being reduced as VPF’s are paid by the film distributors to CDF2. The Company has recorded the reduction of the obligation associated with the payment of VPF’s as a reduction of the interest related to the obligation and the amortization incurred related to the systems, as the payments represent a specific reimbursement of the cost of the systems by the studios. Based on the Company’s expected minimum number of eligible movies to be booked, the Company expects the obligation to be reduced by at least $1,402,000 within the next 12 months. This reduction will be recognized as an offset to amortization and is expected to offset the majority of the amortization of the systems. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 27, 2019 | |
Long-Term Debt | |
Long-Term Debt | 4. Long-Term Debt The Company utilizes derivatives principally to manage market risks and reduce its exposure resulting from fluctuations in interest rates. The Company formally documents all relationships between hedging instruments and hedged items, as well as its risk-management objectives and strategies for undertaking various hedge transactions. The Company entered into two interest rate swap agreements on March 1, 2018 covering $50,000,000 of floating rate debt. The first agreement has a notional amount of $25,000,000, expires March 1, 2021, and requires the Company to pay interest at a defined rate of 2.559% while receiving interest at a defined variable rate of one-month LIBOR (2.50% at June 27, 2019). The second agreement has a notional amount of $25,000,000, expires March 1, 2023, and requires the Company to pay interest at a defined rate of 2.687% while receiving interest at a defined variable rate of one-month LIBOR (2.50% at June 27, 2019). The Company recognizes derivatives as either assets or liabilities on the consolidated balance sheets at fair value. The accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and on the type of hedging relationship. Derivatives that do not qualify for hedge accounting must be adjusted to fair value through earnings. For derivatives that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The Company’s interest rate swap agreements are considered effective and qualify as cash flow hedges. The Company assesses, both at the inception of each hedge and on an on-going basis, whether the derivatives that are used in its hedging transactions are highly effective in offsetting changes in cash flows of the hedged items. As of June 27, 2019, the interest rate swaps were considered highly effective. The fair value of the interest rate swaps on June 27, 2019 and December 27, 2018, respectively, was a liability of $1,311,000 and $205,000, and was included in deferred compensation and other in the consolidated balance sheets. The Company does not expect the interest rate swaps to have a material effect on earnings within the next 12 months. The Company had an interest rate swap that expired in January 2018. The swap agreement covered $25,000,000 of floating rate debt that required the Company to pay interest at a defined fixed rate of 0.96% while receiving interest at a defined variable rate of one-month LIBOR. The Company’s interest rate swap agreement was considered effective and qualified as a cash flow hedge from inception through June 16, 2016, at which time the derivative was undesignated and the balance in accumulated other comprehensive loss was reclassified into interest expense. As of June 16, 2016, the swap was considered ineffective for accounting purposes and the change in fair value was recorded as an increase or decrease in interest expense. As such, the $13,000 decrease in fair value of the swap for the 26 weeks ended June 28, 2018 was recorded to interest expense. During the 13 weeks ended June 27, 2019, a note that was scheduled to mature in January 2020 with a balance of $14,638,000, was repaid and replaced with borrowings on the Company’s revolving credit facility. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 27, 2019 | |
Income Taxes | |
Income Taxes | 5. Income Taxes The Company’s effective income tax rate, adjusted for earnings from noncontrolling interests, for the 13 and 26 weeks ended June 27, 2019 was 23.7% and 22.0%, respectively, and was 25.0% and 25.3% for the 13 and 26 weeks ended June 28, 2018, respectively. The Company does not include the income tax expense or benefit related to the net earnings or loss attributable to noncontrolling interests in its income tax expense as the entity is considered a pass-through entity and, as such, the income tax expense or benefit is attributable to its owners. |
Business Segment Information
Business Segment Information | 6 Months Ended |
Jun. 27, 2019 | |
Business Segment Information | |
Business Segment Information | 6. Business Segment Information The Company’s primary operations are reported in the following business segments: Theatres and Hotels/Resorts. Corporate items include amounts not allocable to the business segments. Corporate revenues consist principally of rent and the corporate operating loss includes general corporate expenses. Corporate information technology costs and accounting shared services costs are allocated to the business segments based upon several factors, including actual usage and segment revenues. Following is a summary of business segment information for the 13 and 26 weeks ended June 27, 2019 and June 28, 2018 (in thousands): 13 Weeks Ended Hotels/ Corporate June 27, 2019 Theatres Resorts Items Total Revenues $ 162,387 $ 69,971 $ 142 $ 232,500 Operating income (loss) 28,219 4,016 (4,760) 27,475 Depreciation and amortization 13,353 4,832 88 18,273 13 Weeks Ended Hotels/ Corporate June 28, 2018 Theatres Resorts Items Total Revenues $ 125,453 $ 67,713 $ 132 $ 193,298 Operating income (loss) 27,877 6,362 (5,132) 29,107 Depreciation and amortization 9,656 4,684 86 14,426 26 Weeks Ended Hotels/ Corporate June 27, 2019 Theatres Resorts Items Total Revenues $ 277,272 $ 125,032 $ 235 $ 402,539 Operating income (loss) 40,813 863 (9,251) 32,425 Depreciation and amortization 24,480 9,599 179 34,258 26 Weeks Ended Hotels/ Corporate June 28, 2018 Theatres Resorts Items Total Revenues $ 238,388 $ 122,881 $ 220 $ 361,489 Operating income (loss) 51,860 3,713 (9,450) 46,123 Depreciation and amortization 18,884 9,274 172 28,330 |
General (Policies)
General (Policies) | 6 Months Ended |
Jun. 27, 2019 | |
General | |
Basis of Presentation | Basis of Presentation - The unaudited consolidated financial statements for the 13 and 26 weeks ended June 27, 2019 and June 28, 2018 have been prepared by the Company. In the opinion of management, all adjustments, consisting of normal recurring adjustments necessary to present fairly the unaudited interim financial information at June 27, 2019, and for all periods presented, have been made. The results of operations during the interim periods are not necessarily indicative of the results of operations for the entire year or other interim periods. However, the unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10‑K for the year ended December 27, 2018. |
Accounting Policies | Accounting Policies - Refer to the Company’s audited consolidated financial statements (including footnotes) for the fiscal year ended December 27, 2018, contained in the Company’s Annual Report on Form 10‑K for such year, for a description of the Company’s accounting policies. During the 26 weeks ended June 27, 2019, there were no significant changes made to the Company’s significant accounting policies other than the changes attributable to the adoption of the Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No. 2016‑02, Leases (Topic 842) , which was adopted on December 28, 2018. The lease policy updates are applied prospectively in the Company’s financial statements from December 28, 2018 forward. Reported financial information for the historical comparable period was not revised and continues to be reported under the accounting standards in effect during the historical periods. See Note 3 for further discussion. |
Depreciation and Amortization | Depreciation and Amortization - Depreciation and amortization of property and equipment are provided using the straight-line method over the shorter of the estimated useful lives of the assets or any related lease terms. Depreciation expense totaled $18,284,000 and $34,239,000 for the 13 and 26 weeks ended June 27, 2019, respectively, and $14,445,000 and $28,481,000 for the 13 and 26 weeks ended June 28, 2018, respectively. |
Earnings Per Share | Earnings Per Share - Net earnings per share (EPS) of Common Stock and Class B Common Stock is computed using the two class method. Basic net earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding. Diluted net earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding, adjusted for the effect of dilutive stock options using the treasury method. Convertible Class B Common Stock is reflected on an if-converted basis. The computation of the diluted net earnings per share of Common Stock assumes the conversion of Class B Common Stock, while the diluted net earnings per share of Class B Common Stock does not assume the conversion of those shares. Holders of Common Stock are entitled to cash dividends per share equal to 110% of all dividends declared and paid on each share of Class B Common Stock. As such, the undistributed earnings for each period are allocated based on the proportionate share of entitled cash dividends. The computation of diluted net earnings per share of Common Stock assumes the conversion of Class B Common Stock and, as such, the undistributed earnings are equal to net earnings for that computation. The following table illustrates the computation of Common Stock and Class B Common Stock basic and diluted net earnings per share for net earnings and provides a reconciliation of the number of weighted-average basic and diluted shares outstanding: 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 27, 2019 June 28, 2018 June 27, 2019 June 28, 2018 (in thousands, except per share data) Numerator: Net earnings attributable to The Marcus Corporation $ 18,066 $ 18,619 $ 19,926 $ 28,440 Denominator: Denominator for basic EPS 30,897 28,010 30,390 27,952 Effect of dilutive employee stock options 504 611 558 582 Denominator for diluted EPS 31,401 28,621 30,948 28,534 Net earnings per share - basic: Common Stock $ 0.60 $ 0.68 $ 0.68 $ 1.05 Class B Common Stock $ 0.54 $ 0.62 $ 0.59 $ 0.95 Net earnings per share - diluted: Common Stock $ 0.58 $ 0.65 $ 0.64 $ 1.00 Class B Common Stock $ 0.54 $ 0.61 $ 0.59 $ 0.93 |
Shareholders' Equity | Shareholders’ Equity - Activity impacting total shareholders’ equity attributable to The Marcus Corporation and noncontrolling interests for the 13 and 26 weeks ended June 27, 2019 and June 28, 2018 was as follows (in thousands, except per share data): Shareholders’ Equity Accumulated Attributable Class B Capital Other to The Non- Common Common in Excess Retained Comprehensive Treasury Marcus controlling Total Stock Stock of Par Earnings Loss Stock Corporation Interests Equity BALANCES AT DECEMBER 27, 2018 $ 22,843 $ 8,347 $ 63,830 $ 439,178 $ (6,758) $ (37,431) $ 490,009 $ 110 $ 490,119 Cash Dividends: $.15 Class B Common Stock — — — (1,183) — — (1,183) — (1,183) $.16 Common Stock — — — (3,633) — — (3,633) — (3,633) Exercise of stock options — — (78) — — 532 454 — 454 Purchase of treasury stock — — — — — (428) (428) — (428) Savings and profit-sharing contribution — — 810 — — 371 1,181 — 1,181 Reissuance of treasury stock — — 31 — — 16 47 — 47 Issuance of non-vested stock — — (127) — — 127 — — — Shared-based compensation — — 777 — — — 777 — 777 Reissuance of treasury stock-acquisition — — 77,960 — — 31,237 109,197 — 109,197 Other — — (109) — — — (109) — (109) Conversions of Class B Common Stock 411 (411) — — — — — — — Distributions to noncontrolling interest — — — — — — — (60) (60) Comprehensive income (loss) — — — 1,860 (297) — 1,563 (66) 1,497 BALANCES AT MARCH 28, 2019 $ 23,254 $ 7,936 $ 143,094 $ 436,222 $ (7,055) $ (5,576) $ 597,875 $ (16) $ 597,859 Cash Dividends: $.15 Class B Common Stock — — — (1,155) — — (1,155) — (1,155) $.16 Common Stock — — — (3,675) — — (3,675) — (3,675) Exercise of stock options — — (27) — — 477 450 — 450 Purchase of treasury stock — — — — — (213) (213) — (213) Reissuance of treasury stock — — 182 — — 96 278 — 278 Issuance of non-vested stock — — (142) — — 142 — — — Shared-based compensation — — 949 — — — 949 — 949 Distributions to noncontrolling interest — — — — — — — (35) (35) Comprehensive income (loss) — — — 18,066 (353) — 17,713 171 17,884 BALANCES AT JUNE 27, 2019 $ 23,254 $ 7,936 $ 144,056 $ 449,458 $ (7,408) $ (5,074) $ 612,222 $ 120 $ 612,342 Shareholders’ Equity Accumulated Attributable Class B Capital Other to The Non- Common Common in Excess Retained Comprehensive Treasury Marcus controlling Total Stock Stock of Par Earnings Income (Loss) Stock Corporation Interests Equity BALANCES AT DECEMBER 28, 2017 $ 22,656 $ 8,534 $ 61,452 $ 403,206 $ (7,425) $ (43,399) $ 445,024 $ 100 $ 445,124 Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2016-01 — — — (11) 11 — — — — Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2018-02 — — — 1,574 (1,574) — — — — Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2014-09 — — — (2,568) — — (2,568) — (2,568) Cash Dividends: $.14 Class B Common Stock — — — (1,163) — — (1,163) — (1,163) $.15 Common Stock — — — (2,907) — — (2,907) — (2,907) Exercise of stock options — — (62) — — 991 929 — 929 Purchase of treasury stock — — — — — (453) (453) — (453) Savings and profit-sharing contribution — — 651 — — 479 1,130 — 1,130 Reissuance of treasury stock — — 26 — — 23 49 — 49 Issuance of non-vested stock — — (108) — — 108 — — — Shared-based compensation — — 596 — — — 596 — 596 Conversions of Class B Common Stock 8 (8) — — — — — — — Distributions to noncontrolling interest — — — — — — — (19) (19) Comprehensive income (loss) — — — 9,821 (30) — 9,791 (15) 9,776 BALANCES AT MARCH 29, 2018 $ 22,664 $ 8,526 $ 62,555 $ 407,952 $ (9,018) $ (42,251) $ 450,428 $ 66 $ 450,494 Cash Dividends: $.14 Class B Common Stock — — — (1,162) — — (1,162) — (1,162) $.15 Common Stock — — — (2,926) — — (2,926) — (2,926) Exercise of stock options — — (33) — — 1,207 1,174 — 1,174 Purchase of treasury stock — — — — — (496) (496) — (496) Reissuance of treasury stock — — 143 — — 93 236 — 236 Issuance of non-vested stock — — (127) — — 127 — — — Shared-based compensation — — 715 — — — 715 — 715 Conversions of Class B Common Stock 5 (5) — — — — — — — Comprehensive income (loss) — — — 18,619 344 — 18,963 93 19,056 BALANCES AT JUNE 28, 2018 $ 22,669 $ 8,521 $ 63,253 $ 422,483 $ (8,674) $ (41,320) $ 466,932 $ 159 $ 467,091 |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss – Accumulated other comprehensive loss presented in the accompanying consolidated balance sheets consists of the following, all presented net of tax: June 27, December 27, 2019 2018 (in thousands) Unrecognized loss on interest rate swap agreements $ (958) $ (149) Net unrecognized actuarial loss for pension obligation (6,450) (6,609) $ (7,408) $ (6,758) |
Fair Value Measurements | Fair Value Measurements - Certain financial assets and liabilities are recorded at fair value in the consolidated financial statements. Some are measured on a recurring basis while others are measured on a non-recurring basis. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. A fair value measurement assumes that a transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The Company’s assets and liabilities measured at fair value are classified in one of the following categories: Level 1 - Assets or liabilities for which fair value is based on quoted prices in active markets for identical instruments as of the reporting date. At June 27, 2019 and December 27, 2018, respectively, the Company’s $6,028,000 and $5,302,000 of debt and equity securities were valued using Level 1 pricing inputs and were included in other current assets. Level 2 - Assets or liabilities for which fair value is based on pricing inputs that were either directly or indirectly observable as of the reporting date. At June 27, 2019 and December 27, 2018, respectively, the Company’s $1,311,000 and $205,000 liability related to the Company’s interest rate swap contracts was valued using Level 2 pricing inputs a nd was included in deferred compensation and other in the consolidated balance sheets. Level 3 - Assets or liabilities for which fair value is based on valuation models with significant unobservable pricing inputs and which result in the use of management estimates. At June 27, 2019 and December 27, 2018, none of the Company’s fair value measurements were valued using Level 3 pricing inputs. See Note 2 for further discussion on Level 3 assumptions used in regard to the acquisition. |
Defined Benefit Plan | Defined Benefit Plan - The components of the net periodic pension cost of the Company’s unfunded nonqualified, defined-benefit plan are as follows: 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 27, 2019 June 28, 2018 June 27, 2019 June 28, 2018 (in thousands) Service cost $ 209 $ 231 $ 418 $ 463 Interest cost 371 341 742 682 Net amortization of prior service cost and actuarial loss 109 155 218 310 Net periodic pension cost $ 689 $ 727 $ 1,378 $ 1,455 Service cost is included in Administrative expense while all other components are recorded within Other expense outside of operating income in the consolidated statements of earnings. |
Revenue Recognition | Revenue Recognition – The disaggregation of revenues by business segment for the 13 and 26 weeks ended June 27, 2019 is as follows (in thousands): 13 Weeks Ended June 27, 2019 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 83,055 $ — $ — $ 83,055 Rooms — 28,194 — 28,194 Theatre concessions 67,920 — — 67,920 Food and beverage — 18,615 — 18,615 Other revenues (1) 11,175 11,216 142 22,533 Cost reimbursements 237 11,946 — 12,183 Total revenues $ 162,387 $ 69,971 $ 142 $ 232,500 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. 26 Weeks Ended June 27, 2019 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 142,024 $ — $ — $ 142,024 Rooms — 47,132 — 47,132 Theatre concessions 115,075 — — 115,075 Food and beverage — 34,398 — 34,398 Other revenues (1) 19,744 23,383 235 43,362 Cost reimbursements 429 20,119 — 20,548 Total revenues $ 277,272 $ 125,032 $ 235 $ 402,539 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. The disaggregation of revenues by business segment for the 13 and 26 weeks ended June 28, 2018 is as follows (in thousands): 13 Weeks Ended June 28, 2018 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 69,607 $ — $ — $ 69,607 Rooms — 29,118 — 29,118 Theatre concessions 46,798 — — 46,798 Food and beverage — 18,836 — 18,836 Other revenues (1) 8,661 11,230 132 20,023 Cost reimbursements 387 8,529 — 8,916 Total revenues $ 125,453 $ 67,713 $ 132 $ 193,298 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. 26 Weeks Ended June 28, 2018 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 132,613 $ — $ — $ 132,613 Rooms — 49,789 — 49,789 Theatre concessions 88,211 — — 88,211 Food and beverage — 34,639 — 34,639 Other revenues (1) 16,698 22,631 220 39,549 Cost reimbursements 866 15,822 — 16,688 Total revenues $ 238,388 $ 122,881 $ 220 $ 361,489 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. The Company had deferred revenue from contracts with customers of $35,135,000 and $37,048,000 as of June 27, 2019 and December 27, 2018, respectively. The Company had no contract assets as of June 27, 2019 and December 27, 2018. During the 13 and 26 weeks ended June 27, 2019, the Company recognized revenue of $4,522,000 and $14,705,000, respectively, that was included in deferred revenues as of December 27, 2018. The majority of the company’s deferred revenue relates to non-redeemed gift cards, advanced ticket sales and the company’s loyalty programs. As of June 27, 2019, the amount of transaction price allocated to the remaining performance obligations under the Company’s advanced ticket sales was $4,462,000 and is reflected in the Company consolidated balance sheet as part of deferred revenues, which is included in other accrued liabilities. The Company recognizes revenue as the tickets are redeemed, which is expected to occur within the next two years. As of June 27, 2019, the amount of transaction price allocated to the remaining performance obligations related to the amount of Hotels and Resorts non-redeemed gift cards was $2,339,000 and is reflected in the Company’s consolidated balance sheet as part of deferred revenues, which is included in other accrued liabilities. The Company recognizes revenue as the gift cards are redeemed, which is expected to occur within the next two years. The majority of the Company’s revenue is recognized in less than one year from the original contract. |
New Accounting Pronouncements | New Accounting Pronouncements – On December 28, 2018, the Company adopted ASU No. 2016‑02, Leases (Topic 842) , which is intended to improve financial reporting related to leasing transactions. ASC 842 requires a lessee to recognize on the balance sheet assets and liabilities for rights and obligations created by leased assets with lease terms of more than 12 months. The new guidance also requires disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from the leases. See Note 3 for further discussion. In January 2017, the FASB issued ASU No. 2017‑04, Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment , which eliminates Step 2 of the goodwill impairment test that had required a hypothetical purchase price allocation. Rather, entities should apply the same impairment assessment to all reporting units and recognize an impairment loss for the amount by which a reporting unit’s carrying amount exceeds its fair value, without exceeding the total amount of goodwill allocated to that reporting unit. Entities will continue to have the option to perform a qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. ASU No. 2017‑04 is effective for the Company in fiscal 2020 and must be applied prospectively. The Company does not believe the new standard will have a material effect on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018‑14, Compensation—Retirement Benefits—Defined Benefit Plans—General , designed to add, remove and clarify disclosure requirements related to defined benefit pension and other postretirement plans. ASU No. 2018‑14 is effective for the Company in fiscal 2021 and early application is permitted. The Company is evaluating the effect that the guidance will have on its financial statement disclosures. In August 2018, the FASB issued ASU No. 2018‑13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, (ASU No. 2018‑13) . The purpose of ASU No. 2018‑13 is to improve the disclosures related to fair value measurements in the financial statements. The improvements include the removal, modification and addition of certain disclosure requirements primarily related to Level 3 fair value measurements. ASU No. 2018‑13 is effective for the Company in fiscal 2020. The amendments in ASU No. 2018‑13 should be applied prospectively. The Company does not expect ASU No. 2018‑13 to have a significant impact on its consolidated financial statements |
General (Tables)
General (Tables) | 6 Months Ended |
Jun. 27, 2019 | |
General | |
Schedule of Earnings Per Share, Basic and Diluted | The following table illustrates the computation of Common Stock and Class B Common Stock basic and diluted net earnings per share for net earnings and provides a reconciliation of the number of weighted-average basic and diluted shares outstanding: 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 27, 2019 June 28, 2018 June 27, 2019 June 28, 2018 (in thousands, except per share data) Numerator: Net earnings attributable to The Marcus Corporation $ 18,066 $ 18,619 $ 19,926 $ 28,440 Denominator: Denominator for basic EPS 30,897 28,010 30,390 27,952 Effect of dilutive employee stock options 504 611 558 582 Denominator for diluted EPS 31,401 28,621 30,948 28,534 Net earnings per share - basic: Common Stock $ 0.60 $ 0.68 $ 0.68 $ 1.05 Class B Common Stock $ 0.54 $ 0.62 $ 0.59 $ 0.95 Net earnings per share - diluted: Common Stock $ 0.58 $ 0.65 $ 0.64 $ 1.00 Class B Common Stock $ 0.54 $ 0.61 $ 0.59 $ 0.93 |
Schedule of Stockholders Equity | Shareholders’ Equity - Activity impacting total shareholders’ equity attributable to The Marcus Corporation and noncontrolling interests for the 13 and 26 weeks ended June 27, 2019 and June 28, 2018 was as follows (in thousands, except per share data): Shareholders’ Equity Accumulated Attributable Class B Capital Other to The Non- Common Common in Excess Retained Comprehensive Treasury Marcus controlling Total Stock Stock of Par Earnings Loss Stock Corporation Interests Equity BALANCES AT DECEMBER 27, 2018 $ 22,843 $ 8,347 $ 63,830 $ 439,178 $ (6,758) $ (37,431) $ 490,009 $ 110 $ 490,119 Cash Dividends: $.15 Class B Common Stock — — — (1,183) — — (1,183) — (1,183) $.16 Common Stock — — — (3,633) — — (3,633) — (3,633) Exercise of stock options — — (78) — — 532 454 — 454 Purchase of treasury stock — — — — — (428) (428) — (428) Savings and profit-sharing contribution — — 810 — — 371 1,181 — 1,181 Reissuance of treasury stock — — 31 — — 16 47 — 47 Issuance of non-vested stock — — (127) — — 127 — — — Shared-based compensation — — 777 — — — 777 — 777 Reissuance of treasury stock-acquisition — — 77,960 — — 31,237 109,197 — 109,197 Other — — (109) — — — (109) — (109) Conversions of Class B Common Stock 411 (411) — — — — — — — Distributions to noncontrolling interest — — — — — — — (60) (60) Comprehensive income (loss) — — — 1,860 (297) — 1,563 (66) 1,497 BALANCES AT MARCH 28, 2019 $ 23,254 $ 7,936 $ 143,094 $ 436,222 $ (7,055) $ (5,576) $ 597,875 $ (16) $ 597,859 Cash Dividends: $.15 Class B Common Stock — — — (1,155) — — (1,155) — (1,155) $.16 Common Stock — — — (3,675) — — (3,675) — (3,675) Exercise of stock options — — (27) — — 477 450 — 450 Purchase of treasury stock — — — — — (213) (213) — (213) Reissuance of treasury stock — — 182 — — 96 278 — 278 Issuance of non-vested stock — — (142) — — 142 — — — Shared-based compensation — — 949 — — — 949 — 949 Distributions to noncontrolling interest — — — — — — — (35) (35) Comprehensive income (loss) — — — 18,066 (353) — 17,713 171 17,884 BALANCES AT JUNE 27, 2019 $ 23,254 $ 7,936 $ 144,056 $ 449,458 $ (7,408) $ (5,074) $ 612,222 $ 120 $ 612,342 Shareholders’ Equity Accumulated Attributable Class B Capital Other to The Non- Common Common in Excess Retained Comprehensive Treasury Marcus controlling Total Stock Stock of Par Earnings Income (Loss) Stock Corporation Interests Equity BALANCES AT DECEMBER 28, 2017 $ 22,656 $ 8,534 $ 61,452 $ 403,206 $ (7,425) $ (43,399) $ 445,024 $ 100 $ 445,124 Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2016-01 — — — (11) 11 — — — — Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2018-02 — — — 1,574 (1,574) — — — — Amount reclassified to retained earnings on December 29, 2017 in connection with the adoption of ASU No. 2014-09 — — — (2,568) — — (2,568) — (2,568) Cash Dividends: $.14 Class B Common Stock — — — (1,163) — — (1,163) — (1,163) $.15 Common Stock — — — (2,907) — — (2,907) — (2,907) Exercise of stock options — — (62) — — 991 929 — 929 Purchase of treasury stock — — — — — (453) (453) — (453) Savings and profit-sharing contribution — — 651 — — 479 1,130 — 1,130 Reissuance of treasury stock — — 26 — — 23 49 — 49 Issuance of non-vested stock — — (108) — — 108 — — — Shared-based compensation — — 596 — — — 596 — 596 Conversions of Class B Common Stock 8 (8) — — — — — — — Distributions to noncontrolling interest — — — — — — — (19) (19) Comprehensive income (loss) — — — 9,821 (30) — 9,791 (15) 9,776 BALANCES AT MARCH 29, 2018 $ 22,664 $ 8,526 $ 62,555 $ 407,952 $ (9,018) $ (42,251) $ 450,428 $ 66 $ 450,494 Cash Dividends: $.14 Class B Common Stock — — — (1,162) — — (1,162) — (1,162) $.15 Common Stock — — — (2,926) — — (2,926) — (2,926) Exercise of stock options — — (33) — — 1,207 1,174 — 1,174 Purchase of treasury stock — — — — — (496) (496) — (496) Reissuance of treasury stock — — 143 — — 93 236 — 236 Issuance of non-vested stock — — (127) — — 127 — — — Shared-based compensation — — 715 — — — 715 — 715 Conversions of Class B Common Stock 5 (5) — — — — — — — Comprehensive income (loss) — — — 18,619 344 — 18,963 93 19,056 BALANCES AT JUNE 28, 2018 $ 22,669 $ 8,521 $ 63,253 $ 422,483 $ (8,674) $ (41,320) $ 466,932 $ 159 $ 467,091 |
Schedule of Accumulated Other Comprehensive Income (Loss) | Accumulated other comprehensive loss presented in the accompanying consolidated balance sheets consists of the following, all presented net of tax: June 27, December 27, 2019 2018 (in thousands) Unrecognized loss on interest rate swap agreements $ (958) $ (149) Net unrecognized actuarial loss for pension obligation (6,450) (6,609) $ (7,408) $ (6,758) |
Schedule of Accumulated Other Comprehensive Income (Loss) | The components of the net periodic pension cost of the Company’s unfunded nonqualified, defined-benefit plan are as follows: 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 27, 2019 June 28, 2018 June 27, 2019 June 28, 2018 (in thousands) Service cost $ 209 $ 231 $ 418 $ 463 Interest cost 371 341 742 682 Net amortization of prior service cost and actuarial loss 109 155 218 310 Net periodic pension cost $ 689 $ 727 $ 1,378 $ 1,455 |
Schedule of Disaggregation of Revenue | The disaggregation of revenues by business segment for the 13 and 26 weeks ended June 27, 2019 is as follows (in thousands): 13 Weeks Ended June 27, 2019 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 83,055 $ — $ — $ 83,055 Rooms — 28,194 — 28,194 Theatre concessions 67,920 — — 67,920 Food and beverage — 18,615 — 18,615 Other revenues (1) 11,175 11,216 142 22,533 Cost reimbursements 237 11,946 — 12,183 Total revenues $ 162,387 $ 69,971 $ 142 $ 232,500 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. 26 Weeks Ended June 27, 2019 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 142,024 $ — $ — $ 142,024 Rooms — 47,132 — 47,132 Theatre concessions 115,075 — — 115,075 Food and beverage — 34,398 — 34,398 Other revenues (1) 19,744 23,383 235 43,362 Cost reimbursements 429 20,119 — 20,548 Total revenues $ 277,272 $ 125,032 $ 235 $ 402,539 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. The disaggregation of revenues by business segment for the 13 and 26 weeks ended June 28, 2018 is as follows (in thousands): 13 Weeks Ended June 28, 2018 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 69,607 $ — $ — $ 69,607 Rooms — 29,118 — 29,118 Theatre concessions 46,798 — — 46,798 Food and beverage — 18,836 — 18,836 Other revenues (1) 8,661 11,230 132 20,023 Cost reimbursements 387 8,529 — 8,916 Total revenues $ 125,453 $ 67,713 $ 132 $ 193,298 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. 26 Weeks Ended June 28, 2018 Reportable Segment Theatres Hotels/Resorts Corporate Total Theatre admissions $ 132,613 $ — $ — $ 132,613 Rooms — 49,789 — 49,789 Theatre concessions 88,211 — — 88,211 Food and beverage — 34,639 — 34,639 Other revenues (1) 16,698 22,631 220 39,549 Cost reimbursements 866 15,822 — 16,688 Total revenues $ 238,388 $ 122,881 $ 220 $ 361,489 (1) Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. |
Acquisition (Tables)
Acquisition (Tables) | 6 Months Ended |
Jun. 27, 2019 | |
Acquisition | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The preliminary purchase price allocation reflected in the Company’s consolidated balance sheet on the acquisition date is as follows (in thousands): Other current assets $ 4,539 Property and equipment 95,848 Operating lease right-of-use-assets 159,541 Other (long-term assets) 9,710 Goodwill 31,697 Taxes other than income (179) Other accrued liabilities (3,125) Operating lease obligations (159,175) Total $ 138,856 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 27, 2019 | |
Leases | |
Schedule of Supplemental Balance Sheet Information Related to Leases | The adoption of ASC 842 had the following effect on the Company’s financial statements as follows (all relating to operating lease right-of-use assets and obligations): Balance at ASC 842 Balance at December 27, 2018 Adjustments December 28, 2018 Assets (in thousands) Other current assets $ 15,355 $ (690) $ 14,665 Operating lease right-of-use assets — 76,178 76,178 Other assets (long term) 33,100 (8,868) 24,232 Liabilities Other accrued liabilities 59,645 (4,396) 55,249 Current portion of operating lease obligations — 5,909 5,909 Operating lease obligations — 75,608 75,608 Deferred compensation and other 56,908 (10,501) 46,407 |
Schedule of Lease, Cost | Total lease cost consists of the following: 13 Weeks 26 Weeks Ended Ended Lease Cost Classification June 27, 2019 June 27, 2019 (in thousands) Finance lease costs: Amortization of finance lease assets Depreciation and amortization $ 971 $ 1,862 Interest on lease liabilities Interest expense 292 586 $ 1,263 $ 2,448 Operating lease costs: Operating lease costs Rent expense $ 6,326 $ 11,366 Variable lease cost Rent expense 542 795 Short-term lease cost Rent expense 10 120 $ 6,878 $ 12,281 |
Schedule of Other Information Related to Leases | 26 Weeks Ended Other Information June 27, 2019 Cash paid for amounts included in the measurement of lease liabilities: Financing cash flows from finance leases $ 1,207 Operating cash flows from finance leases 586 Operating cash flows from operating leases 11,618 Right of use assets obtained in exchange for new lease obligations: Finance lease liabilities 1,627 Operating lease liabilities, including from acquisitions 164,228 June 27, 2019 (in thousands) Finance leases: Property and equipment – gross $ 74,259 Accumulated depreciation and amortization (49,815) Property and equipment - net $ 24,444 |
Schedule of Lease Term and Discount Rate | Lease Term and Discount Rate June 27, 2019 Weighted-average remaining lease terms: Finance leases 9 years Operating leases 15 years Weighted-average discount rates: Finance leases 4.77 % Operating leases 4.64 % |
Schedule of Maturities of Operating and Finance Leases Liabilities | Maturities of lease liabilities as of June 27, 2019 are as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2019 (excluding the 26 weeks ended June 27, 2019) $ 11,170 $ 3,366 2020 25,160 3,560 2021 24,521 2,968 2022 24,949 2,922 2023 23,736 2,823 2024 and thereafter 222,503 16,948 Total lease payments 332,039 32,587 Less: amount representing interest (93,310) (6,614) Total lease liabilities $ 238,729 $ 25,973 |
Schedule of Future Minimum Rental Payments for Operating and Finance Leases | Aggregate minimum lease commitments as of December 27, 2018 under Accounting Standard Codification Topic 840 are as follows (in thousands): Fiscal Year Operating Leases Capital Leases 2019 $ 11,317 $ 3,073 2020 10,169 2,978 2021 9,670 2,679 2022 9,910 2,718 2023 9,038 2,718 2024 and thereafter 80,523 16,940 Total minimum lease payments $ 130,627 31,106 Less: amount representing interest (6,978) Total present value of minimum capital lease payments $ 24,128 |
Business Segment Information (T
Business Segment Information (Tables) | 6 Months Ended |
Jun. 27, 2019 | |
Business Segment Information | |
Schedule of Segment Reporting Information, by Segment | Following is a summary of business segment information for the 13 and 26 weeks ended June 27, 2019 and June 28, 2018 (in thousands): 13 Weeks Ended Hotels/ Corporate June 27, 2019 Theatres Resorts Items Total Revenues $ 162,387 $ 69,971 $ 142 $ 232,500 Operating income (loss) 28,219 4,016 (4,760) 27,475 Depreciation and amortization 13,353 4,832 88 18,273 13 Weeks Ended Hotels/ Corporate June 28, 2018 Theatres Resorts Items Total Revenues $ 125,453 $ 67,713 $ 132 $ 193,298 Operating income (loss) 27,877 6,362 (5,132) 29,107 Depreciation and amortization 9,656 4,684 86 14,426 26 Weeks Ended Hotels/ Corporate June 27, 2019 Theatres Resorts Items Total Revenues $ 277,272 $ 125,032 $ 235 $ 402,539 Operating income (loss) 40,813 863 (9,251) 32,425 Depreciation and amortization 24,480 9,599 179 34,258 26 Weeks Ended Hotels/ Corporate June 28, 2018 Theatres Resorts Items Total Revenues $ 238,388 $ 122,881 $ 220 $ 361,489 Operating income (loss) 51,860 3,713 (9,450) 46,123 Depreciation and amortization 18,884 9,274 172 28,330 |
General - Earnings Per Share (D
General - Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | |
Numerator: | ||||
Net earnings attributable to The Marcus Corporation | $ 18,066 | $ 18,619 | $ 19,926 | $ 28,440 |
Denominator: | ||||
Denominator for basic EPS | 30,897 | 28,010 | 30,390 | 27,952 |
Effect of dilutive employee stock options | 504 | 611 | 558 | 582 |
Denominator for diluted EPS | 31,401 | 28,621 | 30,948 | 28,534 |
Common Stock [Member] | ||||
Net earnings per share - Basic: | ||||
Common Stock | $ 0.60 | $ 0.68 | $ 0.68 | $ 1.05 |
Net earnings per share- Diluted: | ||||
Common Stock | 0.58 | 0.65 | 0.64 | 1 |
Class B Common Stock [Member] | ||||
Net earnings per share - Basic: | ||||
Common Stock | 0.54 | 0.62 | 0.59 | 0.95 |
Net earnings per share- Diluted: | ||||
Common Stock | $ 0.54 | $ 0.61 | $ 0.59 | $ 0.93 |
General - Shareholders' Equity
General - Shareholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 27, 2019 | Mar. 28, 2019 | Jun. 28, 2018 | Mar. 29, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | |
Beginning Balance | $ 597,859 | $ 490,119 | $ 450,494 | $ 445,124 | $ 490,119 | $ 445,124 |
Exercise of stock options | 450 | 454 | 1,174 | 929 | ||
Purchase of treasury stock | (213) | (428) | (496) | (453) | ||
Savings and profit-sharing contribution | 1,181 | 1,130 | ||||
Reissuance of treasury stock | 278 | 47 | 236 | 49 | ||
Share-based compensation | 949 | 777 | 715 | 596 | ||
Reissuance of treasury stock-acquisition | 109,197 | |||||
Other | (109) | |||||
Distributions to noncontrolling interest | (35) | (60) | (19) | |||
Comprehensive income (loss) | 17,884 | 1,497 | 19,056 | 9,776 | 19,381 | 28,832 |
Ending Balance | 612,342 | 597,859 | 467,091 | 450,494 | 612,342 | 467,091 |
Accounting Standards Update 2014-09 [Member] | ||||||
Reclassification to Unappropriated Retained Earnings | (2,568) | (2,568) | ||||
Capital in Excess of Par [Member] | ||||||
Beginning Balance | 143,094 | 63,830 | 62,555 | 61,452 | 63,830 | 61,452 |
Exercise of stock options | (27) | (78) | (33) | (62) | ||
Savings and profit-sharing contribution | 810 | 651 | ||||
Reissuance of treasury stock | 182 | 31 | 143 | 26 | ||
Issuance of non-vested stock | (142) | (127) | (127) | (108) | ||
Share-based compensation | 949 | 777 | 715 | 596 | ||
Reissuance of treasury stock-acquisition | 77,960 | |||||
Other | (109) | |||||
Ending Balance | 144,056 | 143,094 | 63,253 | 62,555 | 144,056 | 63,253 |
Retained Earnings [Member] | ||||||
Beginning Balance | 436,222 | 439,178 | 407,952 | 403,206 | 439,178 | 403,206 |
Comprehensive income (loss) | 18,066 | 1,860 | 18,619 | 9,821 | ||
Ending Balance | 449,458 | 436,222 | 422,483 | 407,952 | 449,458 | 422,483 |
Retained Earnings [Member] | Accounting Standards Update 2016-01 [Member] | ||||||
Reclassification to Unappropriated Retained Earnings | (11) | (11) | ||||
Retained Earnings [Member] | Accounting Standards Update 2018-02 [Member] | ||||||
Reclassification to Unappropriated Retained Earnings | 1,574 | 1,574 | ||||
Retained Earnings [Member] | Accounting Standards Update 2014-09 [Member] | ||||||
Reclassification to Unappropriated Retained Earnings | (2,568) | (2,568) | ||||
Accumulated Other Comprehensive Income (Loss) [Member] | ||||||
Beginning Balance | (7,055) | (6,758) | (9,018) | (7,425) | (6,758) | (7,425) |
Comprehensive income (loss) | (353) | (297) | 344 | (30) | ||
Ending Balance | (7,408) | (7,055) | (8,674) | (9,018) | (7,408) | (8,674) |
Accumulated Other Comprehensive Income (Loss) [Member] | Accounting Standards Update 2016-01 [Member] | ||||||
Reclassification to Unappropriated Retained Earnings | 11 | 11 | ||||
Accumulated Other Comprehensive Income (Loss) [Member] | Accounting Standards Update 2018-02 [Member] | ||||||
Reclassification to Unappropriated Retained Earnings | (1,574) | (1,574) | ||||
Treasury Stock [Member] | ||||||
Beginning Balance | (5,576) | (37,431) | (42,251) | (43,399) | (37,431) | (43,399) |
Exercise of stock options | 477 | 532 | 1,207 | 991 | ||
Purchase of treasury stock | (213) | (428) | (496) | (453) | ||
Savings and profit-sharing contribution | 371 | 479 | ||||
Reissuance of treasury stock | 96 | 16 | 93 | 23 | ||
Issuance of non-vested stock | 142 | 127 | 127 | 108 | ||
Reissuance of treasury stock-acquisition | 31,237 | |||||
Ending Balance | (5,074) | (5,576) | (41,320) | (42,251) | (5,074) | (41,320) |
Shareholders' Equity Attributable to The Marcus Corporation [Member] | ||||||
Beginning Balance | 597,875 | 490,009 | 450,428 | 445,024 | 490,009 | 445,024 |
Exercise of stock options | 450 | 454 | 1,174 | 929 | ||
Purchase of treasury stock | (213) | (428) | (496) | (453) | ||
Savings and profit-sharing contribution | 1,181 | 1,130 | ||||
Reissuance of treasury stock | 278 | 47 | 236 | 49 | ||
Share-based compensation | 949 | 777 | 715 | 596 | ||
Reissuance of treasury stock-acquisition | 109,197 | |||||
Other | (109) | |||||
Comprehensive income (loss) | 17,713 | 1,563 | 18,963 | 9,791 | ||
Ending Balance | 612,222 | 597,875 | 466,932 | 450,428 | 612,222 | 466,932 |
Shareholders' Equity Attributable to The Marcus Corporation [Member] | Accounting Standards Update 2014-09 [Member] | ||||||
Reclassification to Unappropriated Retained Earnings | (2,568) | (2,568) | ||||
Non- controlling Interests [Member] | ||||||
Beginning Balance | (16) | 110 | 66 | 100 | 110 | 100 |
Distributions to noncontrolling interest | (35) | (60) | (19) | |||
Comprehensive income (loss) | 171 | (66) | 93 | (15) | ||
Ending Balance | 120 | (16) | 159 | 66 | 120 | 159 |
Common Stock [Member] | ||||||
Beginning Balance | 23,254 | 22,843 | 22,664 | 22,656 | 22,843 | 22,656 |
Cash dividends: | (3,675) | (3,633) | (2,926) | (2,907) | ||
Conversions of Class B Common Stock | 411 | 5 | 8 | |||
Ending Balance | 23,254 | 23,254 | 22,669 | 22,664 | 23,254 | 22,669 |
Common Stock [Member] | Retained Earnings [Member] | ||||||
Cash dividends: | (3,675) | (3,633) | (2,926) | (2,907) | ||
Common Stock [Member] | Shareholders' Equity Attributable to The Marcus Corporation [Member] | ||||||
Cash dividends: | (3,675) | (3,633) | (2,926) | (2,907) | ||
Class B Common Stock [Member] | ||||||
Beginning Balance | 7,936 | 8,347 | 8,526 | 8,534 | 8,347 | 8,534 |
Cash dividends: | (1,155) | (1,183) | (1,162) | (1,163) | ||
Conversions of Class B Common Stock | (411) | (5) | (8) | |||
Ending Balance | 7,936 | 7,936 | 8,521 | 8,526 | $ 7,936 | $ 8,521 |
Class B Common Stock [Member] | Retained Earnings [Member] | ||||||
Cash dividends: | (1,155) | (1,183) | (1,162) | (1,163) | ||
Class B Common Stock [Member] | Shareholders' Equity Attributable to The Marcus Corporation [Member] | ||||||
Cash dividends: | $ (1,155) | $ (1,183) | $ (1,162) | $ (1,163) |
General - Shareholders' Equit_2
General - Shareholders' Equity Parenthetical (Details) - $ / shares | 3 Months Ended | |||
Jun. 27, 2019 | Mar. 28, 2019 | Jun. 28, 2018 | Mar. 29, 2018 | |
Class B Common Stock [Member] | ||||
Common Stock, Dividends, Per Share, Cash Paid | $ 0.15 | $ 0.15 | $ 0.14 | $ 0.14 |
Common Stock [Member] | ||||
Common Stock, Dividends, Per Share, Cash Paid | $ 0.16 | $ 0.16 | $ 0.15 | $ 0.15 |
General - Accumulated Other Com
General - Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Jun. 27, 2019 | Dec. 27, 2018 |
General | ||
Unrecognized loss on interest rate swap agreements | $ (958) | $ (149) |
Net unrecognized actuarial loss for pension obligation | (6,450) | (6,609) |
Accumulated Other Comprehensive Income (Loss), Net of Tax | $ (7,408) | $ (6,758) |
General - Defined Benefit Plan
General - Defined Benefit Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | |
General | ||||
Service cost | $ 209 | $ 231 | $ 418 | $ 463 |
Interest cost | 371 | 341 | 742 | 682 |
Net amortization of prior service cost and actuarial loss | 109 | 155 | 218 | 310 |
Net periodic pension cost | $ 689 | $ 727 | $ 1,378 | $ 1,455 |
General - Revenue Recognition (
General - Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | ||
Summary of Significant Accounting Policies [Line Items] | |||||
Cost reimbursements | $ 12,183 | $ 8,916 | $ 20,548 | $ 16,688 | |
Total revenues | 232,500 | 193,298 | 402,539 | 361,489 | |
Theatre admissions | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 83,055 | 69,607 | 142,024 | 132,613 | |
Rooms | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 28,194 | 29,118 | 47,132 | 49,789 | |
Theatre concessions | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 67,920 | 46,798 | 115,075 | 88,211 | |
Food and beverage | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 18,615 | 18,836 | 34,398 | 34,639 | |
Other revenues | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 22,533 | [1] | 20,023 | 43,362 | 39,549 |
Theatres Segment [Member] | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Cost reimbursements | 237 | 387 | 429 | 866 | |
Total revenues | 162,387 | 125,453 | 277,272 | 238,388 | |
Theatres Segment [Member] | Theatre admissions | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 83,055 | 69,607 | 142,024 | 132,613 | |
Theatres Segment [Member] | Theatre concessions | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 67,920 | 46,798 | 115,075 | 88,211 | |
Theatres Segment [Member] | Other revenues | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 11,175 | [1] | 8,661 | 19,744 | 16,698 |
Hotels or Resorts [Member] | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Cost reimbursements | 11,946 | 8,529 | 20,119 | 15,822 | |
Total revenues | 69,971 | 67,713 | 125,032 | 122,881 | |
Hotels or Resorts [Member] | Rooms | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 28,194 | 29,118 | 47,132 | 49,789 | |
Hotels or Resorts [Member] | Food and beverage | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 18,615 | 18,836 | 34,398 | 34,639 | |
Hotels or Resorts [Member] | Other revenues | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | 11,216 | [1] | 11,230 | 23,383 | 22,631 |
Corporate Segment [Member] | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Total revenues | 142 | 132 | 235 | 220 | |
Corporate Segment [Member] | Other revenues | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Revenue from Contract with Customer, Including Assessed Tax | $ 142 | [1] | $ 132 | $ 235 | $ 220 |
[1] | Included in other revenues is an immaterial amount related to rental income that is not considered revenue from contracts with customers under ASC Topic 606. |
General - Additional informatio
General - Additional information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | Dec. 27, 2018 | |
Summary of Significant Accounting Policies [Line Items] | |||||
Depreciation | $ 18,284,000 | $ 14,445,000 | $ 34,239,000 | $ 28,481,000 | |
Percentage Of Cash Dividends | 110.00% | ||||
Deferred Revenue | 35,135,000 | $ 35,135,000 | $ 37,048,000 | ||
Deferred Revenue, Revenue Recognized | 4,522,000 | 14,705,000 | |||
Remaining Performance Obligation Related to Advanced Ticket Sales | 4,462,000 | 4,462,000 | |||
Other Deferred Compensation Arrangements, Liability, Classified, Noncurrent | 47,435,000 | $ 47,435,000 | 56,908,000 | ||
Redeemed Revenue From Advanced Tickets Sales Occurred | 2 years | ||||
Hotels or Resorts [Member] | Other Accrued Liabilities [Member] | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Remaining Performance Obligation Related to Hotels Gift Cards | 2,339,000 | $ 2,339,000 | |||
Fair Value, Inputs, Level 1 [Member] | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Trading Securities, Fair Value Disclosure | 6,028,000 | 6,028,000 | 5,302,000 | ||
Fair Value, Inputs, Level 2 [Member] | |||||
Summary of Significant Accounting Policies [Line Items] | |||||
Interest Rate Fair Value Hedge Liability at Fair Value | $ 1,311,000 | $ 1,311,000 | $ 205,000 |
Acquisition - Purchase price al
Acquisition - Purchase price allocation (Details) $ in Thousands | Jun. 27, 2019USD ($) |
Acquisition | |
Other current assets | $ 4,539 |
Property and equipment | 95,848 |
Operating lease right-of-use-assets | 159,541 |
Other (long-term assets) | 9,710 |
Goodwill | 31,697 |
Taxes other than income | (179) |
Other accrued liabilities | (3,125) |
Operating lease obligations | (159,175) |
Total | $ 138,856 |
Acquisition - Additional Inform
Acquisition - Additional Information (Details) - VSSSouthern Theatres LLC [Member] - USD ($) | Feb. 01, 2019 | Dec. 26, 2019 | Dec. 27, 2018 |
Business Acquisition [Line Items] | |||
Business Combination, Consideration Transferred | $ 138,856,000 | ||
Payments to Acquire Businesses, Gross | $ 30,000,000 | ||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 2,450,000 | ||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 109,197,000 | ||
General and Administrative Expense [Member] | |||
Business Acquisition [Line Items] | |||
Business Acquisition, Transaction Costs | $ 1,223,000 | $ 1,507,000 |
Leases - Adoption of ASC 842 (D
Leases - Adoption of ASC 842 (Details) - USD ($) $ in Thousands | Jun. 27, 2019 | Dec. 28, 2018 | Dec. 27, 2018 |
Assets | |||
Other current assets | $ 18,904 | $ 15,355 | |
Operating lease right-of-use assets | 234,064 | 0 | |
Other assets (long term) | 40,046 | 33,100 | |
Liabilities | |||
Other accrued liabilities | 52,810 | 59,645 | |
Current portion of operating lease obligations | 12,967 | 0 | |
Operating lease obligations | 225,762 | 0 | |
Deferred compensation and other | $ 47,435 | $ 56,908 | |
Restatement Adjustment [Member] | |||
Assets | |||
Other current assets | $ (690) | ||
Operating lease right-of-use assets | 76,178 | ||
Other assets (long term) | (8,868) | ||
Liabilities | |||
Other accrued liabilities | (4,396) | ||
Current portion of operating lease obligations | 5,909 | ||
Operating lease obligations | 75,608 | ||
Deferred compensation and other | (10,501) | ||
Accounting Standards Update 2016-02 [Member] | |||
Assets | |||
Other current assets | 14,665 | ||
Operating lease right-of-use assets | 76,178 | ||
Other assets (long term) | 24,232 | ||
Liabilities | |||
Other accrued liabilities | 55,249 | ||
Current portion of operating lease obligations | 5,909 | ||
Operating lease obligations | 75,608 | ||
Deferred compensation and other | $ 46,407 |
Leases - Total lease costs (Det
Leases - Total lease costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 27, 2019 | Jun. 27, 2019 | |
Finance lease costs: | ||
Amortization of finance lease assets | $ 971 | $ 1,862 |
Interest on lease liabilities | 292 | 586 |
Total finance lease costs | 1,263 | 2,448 |
Operating lease costs | ||
Operating lease costs | 6,326 | 11,366 |
Variable lease cost | 542 | 795 |
Short-term lease cost | 10 | 120 |
Total operating lease costs | $ 6,878 | $ 12,281 |
Leases - Other Information (Det
Leases - Other Information (Details) $ in Thousands | 6 Months Ended |
Jun. 27, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Financing cash flows from finance leases | $ 1,207 |
Operating cash flows from finance leases | 586 |
Operating cash flows from operating leases | 11,618 |
Right of use assets obtained in exchange for new lease obligations: | |
Finance lease liabilities | 1,627 |
Operating lease liabilities, including from acquisitions | $ 164,228 |
Leases - Finance leases (Detail
Leases - Finance leases (Details) - USD ($) $ in Thousands | Jun. 27, 2019 | Dec. 27, 2018 |
Finance leases: | ||
Property and equipment - gross | $ 74,259 | $ 72,631 |
Accumulated depreciation and amortization | (49,815) | |
Property and equipment - net | $ 24,444 |
Leases - Lease Term and Discoun
Leases - Lease Term and Discount Rate (Details) | Jun. 27, 2019 |
Weighted-average remaining lease terms: | |
Finance leases | 9 years |
Operating leases | 15 years |
Weighted-average discount rates: | |
Finance leases | 4.77% |
Operating leases | 4.64% |
Leases - Maturities of lease li
Leases - Maturities of lease liabilities (Details) $ in Thousands | Jun. 27, 2019USD ($) |
Operating Leases | |
2019 (excluding the 26 weeks ended June 27, 2019) | $ 11,170 |
2020 | 25,160 |
2021 | 24,521 |
2022 | 24,949 |
2023 | 23,736 |
2024 and thereafter | 222,503 |
Total lease payments | 332,039 |
Less: amount representing interest | (93,310) |
Total lease liabilities | 238,729 |
Finance Leases | |
2019 (excluding the 26 weeks ended June 27, 2019) | 3,366 |
2020 | 3,560 |
2021 | 2,968 |
2022 | 2,922 |
2023 | 2,823 |
2024 and thereafter | 16,948 |
Total lease payments | 32,587 |
Less: amount representing interest | (6,614) |
Total lease liabilities | $ 25,973 |
Leases - Aggregate minimum leas
Leases - Aggregate minimum lease commitments (Details) $ in Thousands | Dec. 27, 2018USD ($) |
Operating Leases | |
2019 | $ 11,317 |
2020 | 10,169 |
2021 | 9,670 |
2022 | 9,910 |
2023 | 9,038 |
2024 and thereafter | 80,523 |
Total minimum lease payments | 130,627 |
Capital Leases | |
2019 | 3,073 |
2020 | 2,978 |
2021 | 2,679 |
2022 | 2,718 |
2023 | 2,718 |
2024 and thereafter | 16,940 |
Total minimum lease payments | 31,106 |
Less: amount representing interest | (6,978) |
Total present value of minimum capital lease payments | $ 24,128 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) | 6 Months Ended | |
Jun. 27, 2019 | Dec. 27, 2018 | |
Capital Leases, Balance Sheet, Assets by Major Class, Net | $ 24,444,000 | |
Digital Systems [Member] | ||
Capital Leases, Balance Sheet, Assets by Major Class, Net | 45,510,000 | $ 45,510,000 |
Commitment Minimum Lease Payments | 6,163,000 | |
Obligation To Be Reduced In Next 12 Months | 1,402,000 | |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 43,735,000 | $ 40,647,000 |
Lease Term Contract | 12 months |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | Dec. 27, 2018 | Mar. 01, 2018 | Jan. 28, 2018 | |
Derivative, Amount of Hedged Item | $ 50,000,000 | ||||||
Interest Expense | $ 3,093,000 | $ 3,511,000 | $ 6,152,000 | $ 6,820,000 | |||
Revolving Credit Facility [Member] | |||||||
Repayments of Notes Payable | $ 14,638,000 | ||||||
Interest Rate Swap [Member] | |||||||
Derivative, Fixed Interest Rate | 0.96% | ||||||
Interest Expense | $ 13,000 | ||||||
Interest Rate Swap Agreements One [Member] | |||||||
Derivative, Fixed Interest Rate | 2.559% | 2.559% | |||||
Derivative Liability, Notional Amount | $ 25,000,000 | $ 25,000,000 | |||||
Interest Rate Swap Agreements One [Member] | LIBOR | |||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | ||||||
Interest Rate Swap Agreements Two [Member] | |||||||
Derivative, Fixed Interest Rate | 2.687% | 2.687% | |||||
Derivative Liability, Notional Amount | $ 25,000,000 | $ 25,000,000 | |||||
Interest Rate Fair Value Hedge Liability at Fair Value | $ 1,311,000 | $ 1,311,000 | $ 205,000 | ||||
Interest Rate Swap Agreements Two [Member] | LIBOR | |||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | |
Income Taxes | ||||
Effective Income Tax Rate | 23.70% | 25.00% | 22.00% | 25.30% |
Business Segment Information (D
Business Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2019 | Jun. 28, 2018 | Jun. 27, 2019 | Jun. 28, 2018 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 232,500 | $ 193,298 | $ 402,539 | $ 361,489 |
Operating income (loss) | 27,475 | 29,107 | 32,425 | 46,123 |
Depreciation and amortization | 18,273 | 14,426 | 34,258 | 28,330 |
Theatres [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 162,387 | 125,453 | 277,272 | 238,388 |
Operating income (loss) | 28,219 | 27,877 | 40,813 | 51,860 |
Depreciation and amortization | 13,353 | 9,656 | 24,480 | 18,884 |
Hotels/Resorts [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 69,971 | 67,713 | 125,032 | 122,881 |
Operating income (loss) | 4,016 | 6,362 | 863 | 3,713 |
Depreciation and amortization | 4,832 | 4,684 | 9,599 | 9,274 |
Corporate Items [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 142 | 132 | 235 | 220 |
Operating income (loss) | (4,760) | (5,132) | (9,251) | (9,450) |
Depreciation and amortization | $ 88 | $ 86 | $ 179 | $ 172 |