Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Oct. 03, 2021 | Nov. 17, 2021 | Apr. 09, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Oct. 3, 2021 | ||
Current Fiscal Year End Date | --10-03 | ||
Document Transition Report | false | ||
Entity File Number | 1-9390 | ||
Entity Registrant Name | JACK IN THE BOX INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 95-2698708 | ||
Entity Address, Address Line One | 9357 Spectrum Center Blvd. | ||
Entity Address, City or Town | San Diego | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 92123 | ||
City Area Code | 858 | ||
Local Phone Number | 571-2121 | ||
Title of 12(b) Security | Common Stock, $0.01 par value | ||
Trading Symbol | JACK | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2.5 | ||
Entity Common Stock, Shares Outstanding | 21,013,361 | ||
Documents Incorporated by Reference | Portions of the Proxy Statement to be filed with the Securities and Exchange Commission in connection with the 2022 Annual Meeting of Stockholders are incorporated by reference into Part III hereof. | ||
Entity Central Index Key | 0000807882 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Current assets: | ||
Cash | $ 55,346 | $ 199,662 |
Restricted cash | 18,222 | 37,258 |
Accounts and other receivables, net | 74,335 | 78,417 |
Inventories | 2,335 | 1,808 |
Prepaid expenses | 12,682 | 10,114 |
Current assets held for sale | 1,692 | 4,598 |
Other current assets | 4,346 | 3,724 |
Total current assets | 168,958 | 335,581 |
Property and equipment, at cost: | ||
Land | 105,393 | 100,460 |
Buildings | 907,792 | 914,311 |
Restaurant and other equipment | 112,959 | 112,675 |
Construction in progress | 6,894 | 4,984 |
Property and equipment, at cost | 1,133,038 | 1,132,430 |
Less accumulated depreciation and amortization | (810,124) | (796,448) |
Property and equipment, net | 322,914 | 335,982 |
Other assets: | ||
Right-of-use assets | 934,066 | 904,548 |
Intangible assets, net | 470 | 277 |
Goodwill | 47,774 | 47,161 |
Deferred tax assets | 51,517 | 72,322 |
Other assets, net | 224,438 | 210,623 |
Total other assets, net | 1,258,265 | 1,234,931 |
Total assets | 1,750,137 | 1,906,494 |
Current liabilities: | ||
Current maturities of long-term debt | 894 | 818 |
Current operating lease liabilities | 150,636 | 179,000 |
Accounts payable | 29,119 | 31,105 |
Accrued liabilities | 148,417 | 129,431 |
Total current liabilities | 329,066 | 340,354 |
Long-term liabilities: | ||
Long-term debt, net of current maturities | 1,273,420 | 1,376,913 |
Long-term operating lease liabilities, net of current portion | 809,191 | 776,094 |
Other long-term liabilities | 156,342 | 206,494 |
Total long-term liabilities | 2,238,953 | 2,359,501 |
Stockholders’ deficit: | ||
Preferred stock $0.01 par value, 15,000,000 shares authorized, none issued | 0 | 0 |
Common stock $0.01 par value, 175,000,000 shares authorized, 82,536,059 and 82,369,714 issued, respectively | 825 | 824 |
Capital in excess of par value | 500,441 | 489,515 |
Retained earnings | 1,764,412 | 1,636,211 |
Accumulated other comprehensive loss | (74,254) | (110,605) |
Treasury stock, at cost, 61,523,475 and 59,646,773 shares, respectively | (3,009,306) | (2,809,306) |
Total stockholders’ deficit | (817,882) | (793,361) |
Total liabilities and stockholders' equity | $ 1,750,137 | $ 1,906,494 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Oct. 03, 2021 | Sep. 27, 2020 |
Stockholders’ deficit: | ||
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 15,000,000 | 15,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 82,536,059 | 82,369,714 |
Treasury stock at cost, shares | 61,523,475 | 59,646,773 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | ||
Revenues | $ 1,143,670 | $ 1,021,506 | $ 950,107 | |
Operating costs and expenses, net: | ||||
Food and packaging | 113,006 | 102,449 | 97,699 | |
Payroll and employee benefits | 119,033 | 106,540 | 100,158 | |
Occupancy and other | 61,743 | 54,157 | 50,613 | |
Franchise occupancy expenses | 214,913 | 210,038 | 166,584 | |
Franchise support and other costs | 13,052 | 13,059 | 12,110 | |
Franchise advertising and other services expenses | 210,328 | 180,794 | 178,093 | |
Selling, general, and administrative expenses | 82,734 | 80,841 | 76,357 | |
Depreciation and amortization | 46,500 | 52,798 | 55,181 | |
Impairment and other (gains) charges, net | (3,382) | (6,493) | 12,455 | |
Gains on the sale of company-operated restaurants | (4,203) | (3,261) | (1,366) | |
Total operating costs and expenses | 853,724 | 790,922 | 747,884 | |
Earnings from operations | 289,946 | 230,584 | 202,223 | |
Other pension and post-retirement expenses, net | 881 | 41,720 | 1,484 | |
Interest expense, net | 67,458 | 66,743 | 84,967 | |
Earnings from continuing operations and before income taxes | 221,607 | 122,121 | 115,772 | |
Income taxes | 55,852 | 32,727 | 24,025 | |
Earnings from continuing operations | 165,755 | 89,394 | 91,747 | |
Earnings from discontinued operations, net of income taxes | 0 | 370 | 2,690 | |
Net earnings | $ 165,755 | $ 89,764 | $ 94,437 | |
Net earnings per share — basic: | ||||
Earnings from continuing operations (in usd per share) | $ 7.40 | $ 3.87 | $ 3.55 | |
Earnings from discontinued operations (in usd per share) | 0 | 0.02 | 0.10 | |
Net earnings per share (in usd per share) | [1] | 7.40 | 3.88 | 3.66 |
Net earnings per share — diluted: | ||||
Earnings from continuing operations (in usd per share) | 7.37 | 3.84 | 3.52 | |
Earnings from discontinued operations (in usd per share) | 0 | 0.02 | 0.10 | |
Net earnings per share (in usd per share) | [1] | 7.37 | 3.86 | 3.62 |
Cash dividends declared per common share (in usd per share) | $ 1.68 | $ 1.20 | $ 1.60 | |
Company restaurant sales | ||||
Revenues | $ 387,766 | $ 348,987 | $ 336,807 | |
Franchise | ||||
Revenues | 346,634 | 320,647 | 272,815 | |
Franchise royalties and other | ||||
Revenues | 204,725 | 178,319 | 169,811 | |
Franchise contributions for advertising and other services | ||||
Revenues | $ 204,545 | $ 173,553 | $ 170,674 | |
[1] | Earnings per share may not add due to rounding. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Statement of Comprehensive Income [Abstract] | |||
Net earnings | $ 165,755,000 | $ 89,764,000 | $ 94,437,000 |
Unrecognized periodic benefit costs: | |||
Actuarial gains (losses) arising during the period | 44,134,000 | (4,875,000) | (62,377,000) |
Actuarial losses and prior service cost reclassified to earnings | 4,931,000 | 44,616,000 | 3,917,000 |
Unrecognized periodic benefit costs, before tax | 49,065,000 | 39,741,000 | (58,460,000) |
Tax effect | (12,714,000) | (10,340,000) | 15,176,000 |
Unrecognized periodic benefit costs, net of tax | 36,351,000 | 29,401,000 | (43,284,000) |
Cash flow hedges: | |||
Net change in fair value of derivatives | (23,625,000) | ||
Net loss reclassified to earnings | 24,328,000 | ||
Cash flow hedges | 703,000 | ||
Tax effect | (3,165,000) | ||
Cash flow hedges, net of tax | (2,462,000) | ||
Other comprehensive income (loss), net of taxes | 36,351,000 | 29,401,000 | (45,746,000) |
Comprehensive income | $ 202,106,000 | $ 119,165,000 | $ 48,691,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Cash flows from operating activities: | |||
Net earnings | $ 165,755 | $ 89,764 | $ 94,437 |
Earnings from discontinued operations | 0 | 370 | 2,690 |
Earnings from continuing operations | 165,755 | 89,394 | 91,747 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | |||
Depreciation and amortization | 46,500 | 52,798 | 55,181 |
Amortization of franchise tenant improvement allowances and incentives | 3,450 | 3,028 | 1,983 |
Amortization of debt issuance costs | 5,595 | 5,628 | 3,121 |
Loss on extinguishment of debt | 0 | 0 | 2,757 |
Loss on interest rate swap termination | 0 | 0 | 23,551 |
Excess tax benefits from share-based compensation arrangements | (1,160) | (449) | (113) |
Deferred income taxes | 8,008 | 5,162 | 4,100 |
Share-based compensation expense | 4,048 | 4,394 | 8,074 |
Pension and postretirement expense | 881 | 41,720 | 1,484 |
Gains on cash surrender value of company-owned life insurance | (12,753) | (4,262) | (4,475) |
Gains on the sale of company-operated restaurants | (4,203) | (3,261) | (1,366) |
Gains on the disposition of property and equipment | (6,888) | (9,768) | (6,244) |
Impairment charges and other | 2,889 | 322 | 5,414 |
Changes in assets and liabilities, excluding acquisitions and dispositions: | |||
Accounts and other receivables | 5,072 | (27,865) | 4,131 |
Inventories | (269) | 41 | 82 |
Prepaid expenses and other current assets | (2,766) | (2,780) | 8,728 |
Operating lease right-of-use assets and lease liabilities | (24,784) | 490 | |
Accounts payable | (3,091) | 2,018 | 6,537 |
Accrued liabilities | 28,990 | 4,222 | (7,505) |
Pension and postretirement contributions | (6,084) | (6,243) | (6,194) |
Franchise tenant improvement allowance and incentive disbursements | (8,568) | (10,239) | (13,233) |
Other | 500 | (825) | (9,355) |
Cash flows provided by operating activities | 201,122 | 143,525 | 168,405 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (41,008) | (19,528) | (47,649) |
Proceeds from the sale and leaseback of assets | 3,884 | 19,828 | 4,447 |
Proceeds from the sale of company-operated restaurants | 1,827 | 3,395 | 1,280 |
Collections on notes receivable | 0 | 0 | 16,759 |
Proceeds from the sale of property and equipment | 11,742 | 22,774 | 9,714 |
Other | 2,626 | 2,654 | 1,630 |
Cash flows (used in) provided by investing activities | (20,929) | 29,123 | (13,819) |
Cash flows from financing activities: | |||
Borrowings on revolving credit facilities | 0 | 114,376 | 229,798 |
Repayments of borrowings on revolving credit facilities | (107,875) | (6,500) | (960,220) |
Proceeds from issuance of debt | 0 | 0 | 1,300,000 |
Principal repayments on debt | (829) | (10,536) | (337,150) |
Debt issuance costs | 0 | (216) | (34,122) |
Payments related to termination of interest rate swaps | 0 | 0 | (23,551) |
Dividends paid on common stock | (37,322) | (27,538) | (41,179) |
Proceeds from issuance of common stock | 6,647 | 4,647 | 1,231 |
Repurchases of common stock | (200,000) | (155,576) | (137,654) |
Payroll tax payments for equity award issuances | (4,166) | (5,946) | (2,883) |
Cash flows used in financing activities | (343,545) | (87,289) | (5,730) |
Net (decrease) increase in cash and restricted cash | (163,352) | 85,359 | 148,856 |
Cash and restricted cash at beginning of year | 236,920 | 151,561 | 2,705 |
Cash and restricted cash at end of year | $ 73,568 | $ 236,920 | $ 151,561 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Deficit - USD ($) | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Capital in Excess of Par Value | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | Treasury Stock |
Balance, shares at Sep. 30, 2018 | 82,061,661 | |||||||
Balance at Sep. 30, 2018 | $ (591,699,000) | $ (37,330,000) | $ 821,000 | $ 470,826,000 | $ 1,561,353,000 | $ (37,330,000) | $ (94,260,000) | $ (2,530,439,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shares issued under stock plans, including tax benefit (in shares) | 97,341 | |||||||
Shares issued under stock plans, including tax benefit | 1,232,000 | $ 1,000 | 1,231,000 | |||||
Share-based compensation | 8,074,000 | 8,074,000 | ||||||
Dividends declared | (41,235,000) | 191,000 | (41,426,000) | |||||
Purchases of treasury stock | (125,317,000) | (125,317,000) | ||||||
Net earnings | 94,437,000 | 94,437,000 | ||||||
Other comprehensive income (loss) | (45,746,000) | (45,746,000) | ||||||
Balance, shares at Sep. 29, 2019 | 82,159,002 | |||||||
Balance at Sep. 29, 2019 | (737,584,000) | $ (2,870,000) | $ 822,000 | 480,322,000 | 1,577,034,000 | $ (2,870,000) | (140,006,000) | (2,655,756,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shares issued under stock plans, including tax benefit (in shares) | 210,712 | |||||||
Shares issued under stock plans, including tax benefit | 4,647,000 | $ 2,000 | 4,645,000 | |||||
Share-based compensation | 4,394,000 | 4,394,000 | ||||||
Dividends declared | (27,563,000) | 154,000 | (27,717,000) | |||||
Purchases of treasury stock | (153,550,000) | (153,550,000) | ||||||
Net earnings | 89,764,000 | 89,764,000 | ||||||
Other comprehensive income (loss) | 29,401,000 | 29,401,000 | ||||||
Balance, shares at Sep. 27, 2020 | 82,369,714 | |||||||
Balance at Sep. 27, 2020 | (793,361,000) | $ 824,000 | 489,515,000 | 1,636,211,000 | (110,605,000) | (2,809,306,000) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shares issued under stock plans, including tax benefit (in shares) | 166,345 | |||||||
Shares issued under stock plans, including tax benefit | 6,647,000 | $ 1,000 | 6,646,000 | |||||
Share-based compensation | 4,048,000 | 4,048,000 | ||||||
Dividends declared | (37,322,000) | 232,000 | (37,554,000) | |||||
Purchases of treasury stock | (200,000,000) | (200,000,000) | ||||||
Net earnings | 165,755,000 | 165,755,000 | ||||||
Other comprehensive income (loss) | 36,351,000 | 36,351,000 | ||||||
Balance, shares at Oct. 03, 2021 | 82,536,059 | |||||||
Balance at Oct. 03, 2021 | $ (817,882,000) | $ 825,000 | $ 500,441,000 | $ 1,764,412,000 | $ (74,254,000) | $ (3,009,306,000) |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 12 Months Ended |
Oct. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations and Summary of Significant Accounting Policies | NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of operations — Founded in 1951, Jack in the Box Inc. (the “Company”) operates and franchises Jack in the Box ® quick-service restaurants. The Company operates as a single segment for reporting purposes. The following table summarizes the number of restaurants as of the end of each fiscal year: 2021 2020 2019 Company-operated 163 144 137 Franchise 2,055 2,097 2,106 Total system 2,218 2,241 2,243 References to the Company throughout these notes to the consolidated financial statements are made using the first-person notations of “we,” “us,” and “our.” Basis of presentation — The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain prior period information on the consolidated statement of cash flows has been reclassified to conform to the current year presentation. Fiscal year — Our fiscal year is 52 or 53 weeks ending the Sunday closest to September 30. Comparisons throughout these notes to the consolidated financial statements refer to the 53-week period ended October 3, 2021 for the fiscal year 2021 and 52-week periods ended September 27, 2020 and September 29, 2019 for fiscal years 2020 and 2019, respectively. Principles of consolidation — The accompanying consolidated financial statements include the accounts of Jack in the Box Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated upon consolidation. Use of estimates — In preparing the consolidated financial statements in conformity with U.S. GAAP, management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities, revenues, expenses, and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially from these estimates. Restricted cash — In accordance with the terms of our securitized financing facility, certain cash balances are required to be held in trust. Such restricted cash primarily represents cash collections and cash reserves held by the trustee to be used for payments of quarterly interest and commitment fees required for the Class A-1 and Class A-2 Notes. Starting in the second quarter of 2020, with uncertainty surrounding COVID-19 events, we voluntarily elected to fund cash held in trust for one additional quarterly interest and commitment fee payment. This voluntary election was discontinued in the second quarter of 2021. As of October 3, 2021 and September 27, 2020, restricted cash balances were $18.2 million and $37.3 million, respectively. Accounts and other receivables, net — Our accounts and other receivables, net is primarily comprised of receivables from franchisees, tenants, credit card processors, and insurance receivables. Franchisee receivables primarily include rents, property taxes, royalties, marketing, sourcing and technology support fees associated with lease and franchise agreements, and notes from certain of our franchisees. Tenant receivables relate to subleased properties where we are on the master lease agreement. We accrue interest on notes receivable based on the contractual terms. The allowance for doubtful accounts is based on historical experience and a review of existing receivables. Inventories — Our inventories consist principally of food, packaging, and supplies, and are valued at the lower of cost or market on a first-in, first-out basis. Assets held for sale — Our assets held for sale typically includes property we plan to sell within the next year. If the determination is made that we no longer expect to sell an asset within the next year, the asset is reclassified out of assets held for sale. Long-lived assets that meet the held for sale criteria are reported at the lower of their carrying value or fair value, less estimated costs to sell. Property and equipment, net — Expenditures for new facilities and equipment, and those that substantially increase the useful lives of the property, are capitalized. Facilities leased under finance leases are stated at the present value of minimum lease payments at the beginning of the lease term, not to exceed fair value. Maintenance and repairs are expensed as incurred. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts, and gains or losses on the dispositions are included in “Impairment and other (gains) charges, net” in the accompanying consolidated statements of earnings. Buildings, equipment, and leasehold improvements are generally depreciated using the straight-line method based on the estimated useful lives of the assets, over the initial lease term for certain assets acquired in conjunction with the lease commencement for leased properties, or the remaining lease term for certain assets acquired after the commencement of the lease for leased properties. In certain situations, one or more option periods may be used in determining the depreciable life of assets related to leased properties if we deem that an economic penalty would be incurred otherwise. In either circumstance, our policy requires lease term consistency when calculating the depreciation period, in classifying the lease and in computing straight-line rent expense. Building, leasehold improvement assets and equipment are assigned lives that range from 1 to 35 years. Depreciation expense related to property and equipment was $46.5 million, $52.8 million, and $55.2 million in fiscal year 2021, 2020, and 2019, respectively. Impairment of long-lived assets — We evaluate long-lived assets, such as property and equipment and operating lease right-of-use assets, for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable. Long-lived assets are grouped for recognition and measurement of impairment at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets. The impairment test for long-lived assets requires us to assess the recoverability of long-lived assets by comparing their net carrying value to the sum of undiscounted estimated future cash flows directly associated with and arising from our use and eventual disposition of the assets. If the carrying amount of a long-lived asset group exceeds the sum of related undiscounted future cash flows, we recognize an impairment loss by the amount that the carrying value of the assets exceeds fair value. Refer to Note 9, Impairment and Other (Gains) Charges, Net , for additional information. Goodwill and intangible assets — Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired, if any. We generally record goodwill in connection with the acquisition of restaurants from franchisees. Likewise, upon the sale of restaurants to franchisees, goodwill is decremented. The amount of goodwill written-off is determined as the fair value of the business disposed of as a percentage of the fair value of the reporting unit retained. If the business disposed of was never fully integrated into the reporting unit after its acquisition, and thus the benefits of the acquired goodwill were never realized, the current carrying amount of the acquired goodwill is written off. Goodwill is evaluated for impairment annually during the fourth quarter, or more frequently if indicators of impairment are present. We first assess qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of a reporting unit or indefinite-lived asset is less than its carrying amount. If the qualitative factors indicate that it is more likely than not that the fair value is less than the carrying amount, we perform a single-step impairment test. To perform our impairment analysis, we estimate the fair value of the reporting unit and compare it to the carrying value. If the carrying value exceeds the fair value, an impairment loss is recognized equal to the excess. Refer to Note 4, Goodwill , for additional information. Reacquired franchise rights are recorded in connection with our acquisition of franchised restaurants and are amortized over the remaining contractual period of the franchise contract in which the right was granted. As of October 3, 2021 and September 27, 2020, the carrying value of our intangible assets was $0.5 million and $0.3 million, respectively, and are included in “Intangible assets, net” in the accompanying consolidated balance sheets. Company-owned life insurance — We have purchased company-owned life insurance (“COLI”) policies to support our non-qualified benefit plans. The cash surrender values of these policies were $123.6 million and $113.8 million as of October 3, 2021 and September 27, 2020, respectively, and are included in “Other assets, net”, in the accompanying consolidated balance sheets. Changes in cash surrender values are included in “Selling, general and administrative expenses” in the accompanying consolidated statements of earnings. These policies reside in an umbrella trust for use only to pay plan benefits to participants or to pay creditors if the Company becomes insolvent. Leases — We evaluate the contracts entered into by the Company to determine whether such contracts contain leases. A contract contains a lease if the contract conveys the right to control the use of identified property, plant, and equipment for a period of time in exchange for consideration. At commencement, contracts containing a lease are further evaluated for classification as an operating or finance lease where the Company is a lessee, or as an operating, sales-type, or direct financing lease where the Company is a lessor, based on their terms. The lease term and incremental borrowing rate for each lease requires judgement by management and can impact the classification of our leases as well as the value of our lease assets and liabilities. When determining the lease term, we consider option periods available, and include option periods in the measurement of the lease right-of-use (“ROU”) asset and lease liability where the exercise is reasonably certain to occur. As our leases do not provide an implicit discount rate, we have determined it is appropriate to use our estimated collateralized incremental borrowing rate, based on the yield curve for the respective lease terms, in calculating our lease liabilities. Revenue recognition — “Company restaurant sales” include revenue recognized upon delivery of food and beverages to the customer at company-operated restaurants, which is when our obligation to perform is satisfied. Company restaurant sales exclude taxes collected from the Company’s customers. Gift cards, upon customer purchase, are recorded as deferred income and are recognized in revenue as they are redeemed. “Franchise rental revenues” received from franchised restaurants based on fixed rental payments are recognized as revenue over the term of the lease. Rental revenue from properties owned and leased by the Company and leased or subleased to franchisees is recognized on a straight-line basis over the respective term of the lease. Certain franchise rents, which are contingent upon sales levels, are recognized in the period in which the contingency is met. “Franchise royalties and other” primarily includes royalties and franchise fees received from our franchisees. Royalties are based upon a percentage of sales of the franchised restaurant and are recognized as earned. Franchise royalties are billed on a monthly basis. Franchise fees when a new restaurant opens or at the start of a new franchise term are recorded as deferred revenue when received and recognized as revenue over the term of the franchise agreement. “Franchise contributions for advertising and other services” includes franchisee contributions to our marketing fund billed on a monthly basis and sourcing and technology fees, as required under the franchise agreements. Contributions to our marketing fund are based on a percentage of sales and recognized as earned. Sourcing and technology services are recognized when the goods or services are transferred to the franchisee. Gift cards — We sell gift cards to our customers in our restaurants and through selected third parties. The gift cards sold to our customers have no stated expiration dates and are subject to actual or potential escheatment rights in several of the jurisdictions in which we operate. We recognize income from gift cards when redeemed by the customer. While we will continue to honor all gift cards presented for payment, we may determine the likelihood of redemption to be remote for certain card balances due to, among other things, long periods of inactivity. In these circumstances, to the extent we determine there is no requirement for remitting balances to government agencies under unclaimed property laws, card balances may be recognized as income in our statement of earnings. Amounts recognized on unredeemed gift card balances were $0.6 million, $0.5 million, and $0.5 million in fiscal 2021, 2020, and 2019, respectively. Pre-opening costs — Pre-opening costs associated with the opening of a new restaurant or the remodeling of an existing restaurant consist primarily of property rent and employee training costs. Pre-opening costs associated with the opening of a restaurant that was closed upon acquisition consist of labor costs, maintenance and repair costs, and property rent. Pre-opening costs are included in “Selling, general and administrative expenses” in the accompanying consolidated statements of earnings. Self-insurance — We are self-insured for a portion of our workers’ compensation, general liability, employee medical and dental, and automotive claims. We utilize a paid-loss plan for our workers’ compensation, general liability, and automotive programs, which have predetermined loss limits per occurrence and in the aggregate. We establish our insurance liability (undiscounted) and reserves using independent actuarial estimates of expected losses for determining reported claims and as the basis for estimating claims incurred, but not reported. As of October 3, 2021 and September 27, 2020, our estimated liability for general liability and workers’ compensation claims exceeded our self-insurance retention limits by $1.8 million and $1.9 million, respectively, which we expect our insurance providers to pay on our behalf in accordance with the contractual terms of our insurance policies. Advertising costs — We administer a marketing fund that includes contractual contributions. In 2021, 2020 and 2019, marketing fund contributions from franchise and company-operated restaurants were approximately 5.0% of gross revenues with the exception of our March 2020 and April 2020 marketing fees. In response to the economic burden associated with the COVID-19 pandemic, the Company reduced March 2020 marketing fees to 4.0% and postponed the collection of these fees over the course of 24 months. April 2020 marketing fees ranged from 2% to 4% based on annualized sales volumes, and these fees will be collected over three months beginning October 2020. As of October 3, 2021, postponed marketing fees which remain uncollected were $4.3 million which is included within “Accounts and other receivables, net” in our consolidated balance sheet. Production costs of commercials, programming, and other marketing activities are charged to the marketing funds when the advertising is first used for its intended purpose, and the costs of advertising are charged to operations as incurred. When contributions to the marketing fund exceed the related advertising expenses, advertising costs are accrued up to the amount of revenues on an annual basis since we are contractually obligated to spend these funds. As of October 3, 2021 and September 27, 2020, additional amounts accrued were $9.5 million and $8.3 million, respectively, for this requirement. There have been no incremental contributions to the marketing fund made in 2021 or 2020. In 2019, incremental contributions to the marketing fund were $2.0 million. Total contributions made by the Company, including incremental contributions, are included in “Selling, general, and administrative expenses” in the accompanying consolidated statements of earnings. In fiscal 2021, 2020, and 2019 advertising costs were $19.6 million, $17.1 million, and $19.0 million, respectively. Share-based compensation — We account for our share-based compensation under the Financial Accounting Standards Board (“FASB”) authoritative guidance on stock compensation , which generally requires, among other things, that all employee share-based compensation be measured using a fair value method and that the resulting compensation cost be recognized in the financial statements. Compensation expense for our share-based compensation awards is generally recognized on a straight-line basis over the shorter of the vesting period or the period from the date of grant to the date the employee becomes eligible to retire. Refer to Note 13, Share-based Employee Compensation , for additional information. Income taxes — Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as tax loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. We recognize interest and, when applicable, penalties related to unrecognized tax benefits as a component of our income tax provision. Authoritative guidance issued by the FASB prescribes a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. The minimum threshold is defined as a tax position that is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Refer to Note 11, Income Taxes , for additional information. Derivative instruments — We have historically used interest rate swaps to hedge interest rate volatility under our senior credit facility. On July 2, 2019, we terminated all interest rate swap agreements in anticipation of the securitization transaction. Prior to terminating the agreements, a ll derivatives were recognized on the consolidated balance sheets at fair value based upon quoted market prices. Changes in the fair values of derivatives were recorded in earnings or other comprehensive income (“OCI”), based on whether or not the instrument is designated as a hedge transaction. Gains or losses on derivative instruments that qualify for hedge designation were reported in OCI and reclassified to earnings in the period the hedged item affected earnings. When the underlying hedge transaction ceased to exist, the associated amount reported in OCI was reclassified to earnings at that time. Refer to Note 6, Derivative Instruments, for additional information. Contingencies — We recognize liabilities for contingencies when we have an exposure that indicates it is probable that an asset has been impaired or that a liability has been incurred and the amount of impairment or loss can be reasonably estimated. Our ultimate legal and financial liability with respect to such matters cannot be estimated with certainty and requires the use of estimates. When the reasonable estimate is a range, the recorded loss will be the best estimate within the range. We record legal settlement costs when those costs are probable and reasonably estimable. Refer to Note 16, Commitments and Contingencies , for additional information. Effect of new accounting pronouncements adopted in fiscal 2021 — In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , that requires measurement and recognition of expected versus incurred credit losses for financial assets held, including trade receivables. The Company adopted the new guidance in the first quarter of 2021 using the modified retrospective method. The adoption did not have a material impact to our consolidated financial statements. The Company closely monitors the financial condition of our franchisees and estimates the allowance for credit losses based on the lifetime expected loss on receivables. These estimates are based on historical collection experience with our franchisees as well as other factors, including current market conditions and events. Credit quality is monitored through the timing of payments compared to predefined aging criteria and known facts regarding the financial condition of the franchisee or customer. Account balances are charged off against the allowance after recovery efforts have ceased. The Company’s allowance for receivables have not historically been material. The following table summarizes the activity in our allowance for doubtful accounts ( in thousands ): Balance as of September 27, 2020 $ (5,541) Provision for expected credit losses (770) Write-offs charged against the allowance 19 Balance as of October 3, 2021 $ (6,292) In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which aligns the requirements for capitalizing implementation costs in cloud computing arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted the standard in the first quarter of 2021. The adoption of this standard did not have a material impact to our consolidated financial statements. Effect of new accounting pronouncements to be adopted in future periods — We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our consolidated financial statements. |
Revenue
Revenue | 12 Months Ended |
Oct. 03, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | REVENUE Nature of products and services — We derive revenue from retail sales at Jack in the Box company-operated restaurants and rental revenue, royalties, advertising, and franchise and other fees from franchise-operated restaurants. Our franchise arrangements generally provide for an initial franchise fee of $50,000 per restaurant and generally require that franchisees pay royalty and marketing fees at 5% of gross sales. The agreement also requires franchisees to pay sourcing, technology support and other miscellaneous fees. Disaggregation of revenue — The following table disaggregates revenue by primary source for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019 (in thousands) : 2021 2020 2019 Sources of revenue: Company restaurant sales $ 387,766 $ 348,987 $ 336,807 Franchise rental revenues 346,634 320,647 272,815 Franchise royalties 193,908 171,407 163,047 Marketing fees 188,184 158,258 157,969 Technology and sourcing fees 16,361 15,295 12,705 Franchise fees and other services 10,817 6,912 6,764 Total revenue $ 1,143,670 $ 1,021,506 $ 950,107 Contract liabilities — Our contract liabilities consist of deferred revenue resulting from initial fees received from franchisees for new restaurant openings or new franchise terms, which are generally recognized over the franchise term. We classify these contract liabilities within “Accrued liabilities” and “Other long-term liabilities” in our consolidated balance sheets. A summary of significant changes in our contract liabilities is presented below (in thousands) : 2021 2020 2019 Deferred franchise fees at beginning of period $ 43,541 $ 46,273 $ 50,018 Revenue recognized during the period (6,014) (5,440) (5,173) Additions during the period 2,905 2,708 1,428 Deferred franchise fees at end of period $ 40,432 $ 43,541 $ 46,273 The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied at the end of the period (in thousands) : 2022 $ 4,842 2023 4,690 2024 4,502 2025 4,274 2026 3,953 Thereafter 18,171 $ 40,432 We have applied the optional exemption, as provided for under ASC Topic 606, Revenue from Contracts with Customers , which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty. |
Summary of Refranchisings and F
Summary of Refranchisings and Franchise Acquisitions | 12 Months Ended |
Oct. 03, 2021 | |
Summary Of Refranchisings, Franchisee Development And Acquisitions [Abstract] | |
Summary of Refranchisings and Franchisee Acquisitions | SUMMARY OF REFRANCHISINGS AND FRANCHISE ACQUISITIONS Refranchisings — In 2021, 2020, and 2019, no company-operated restaurants were sold to franchisees. Amounts included in “Gains on the sale of company-operated restaurants” in all periods related to resolutions of certain contingencies from the sale of restaurants in prior years. Franchise acquisitions — In 2021 and 2020, we acquired 20 and 8 franchise restaurants, respectively. In 2019 we did not acquire any franchise restaurants. Of the 20 restaurants acquired in 2021, we took over 16 restaurants as a result of an agreement with an underperforming franchisee who was in violation of franchise and lease agreements with the Company. Under this agreement, the franchisee voluntarily agreed to turn over the restaurants. The acquisition of the additional 4 restaurants in 2021 was the result of exercising our right of first refusal. We account for the acquisition of franchised restaurants using the acquisition method of accounting for business combinations. The purchase price allocations were based on fair value estimates determined using significant unobservable inputs (Level 3). The goodwill recorded primarily relates to the sales growth potential of the market acquired and is expected to be deductible for income tax purposes. The following table provides detail of the combined acquisitions in 2021 and 2020 ( dollars in thousands ): 2021 2020 Restaurants acquired from franchisees 20 8 Inventory $ 258 $ 73 Property and equipment 1,136 903 Intangible assets 245 263 Other assets 10 6 Goodwill 613 414 Gains on the acquisition of franchise-operated restaurants (340) — Liabilities assumed (277) (800) Total consideration $ 1,645 $ 859 |
Goodwill
Goodwill | 12 Months Ended |
Oct. 03, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | GOODWILL The changes in the carrying amount of goodwill during fiscal 2021 and 2020 were as follows ( in thousands ): Balance at September 29, 2019 $ 46,747 Acquisition of franchise-operated restaurants 414 Balance at September 27, 2020 47,161 Acquisition of franchise-operated restaurants 613 Balance at October 3, 2021 $ 47,774 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Oct. 03, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Financial assets and liabilities — The following table presents the financial assets and liabilities measured at fair value on a recurring basis ( in thousands ): Total Quoted Significant Significant Fair value measurements as of October 3, 2021: Non-qualified deferred compensation plan (1) $ 18,555 $ 18,555 $ — $ — Total liabilities at fair value $ 18,555 $ 18,555 $ — $ — Fair value measurements as of September 27, 2020: Non-qualified deferred compensation plan (1) $ 25,071 $ 25,071 $ — $ — Total liabilities at fair value $ 25,071 $ 25,071 $ — $ — ________________________ (1) We maintain an unfunded defined contribution plan for key executives and other members of management. The fair value of this obligation is based on the closing market prices of the participants’ elected investments. The obligation is included in “Accrued liabilities” and “Other long-term liabilities” on our consolidated balance sheets. (2) We did not have any transfers in or out of Level 1, 2, or 3. The following table presents the carrying value and estimated fair value of our Class A-2 Notes as of October 3, 2021 and September 27, 2020 ( in thousands ): October 3, September 27, Carrying Amount Fair Value Carrying Amount Fair Value Class A-2 Notes $ 1,290,251 $ 1,351,057 $ 1,290,251 $ 1,354,241 The fair value of the Class A-2 Notes was estimated using Level 2 inputs based on quoted market prices in markets that are not considered active markets. Non-financial assets and liabilities — Our non-financial instruments, which primarily consist of property and equipment, operating lease right-of-use assets, goodwill, and intangible assets, are reported at carrying value and are not required to be measured at fair value on a recurring basis. However, on an annual basis, or whenever events or changes in circumstances indicate that their carrying value may not be recoverable, non-financial instruments are assessed for impairment. If applicable, the carrying values are written down to fair value. In connection with our impairment reviews performed during 2021, no material fair value adjustments were required. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Oct. 03, 2021 | |
Derivative Instruments and Hedges, Assets [Abstract] | |
Derivative Instruments | DERIVATIVE INSTRUMENTS Interest rate swaps — We have used interest rate swaps to mitigate interest rate volatility with regard to variable rate borrowings under our senior credit facility. In June 2015, we entered into forward-starting interest rate swap agreements that effectively converted $500.0 million of our variable rate borrowings to a fixed rate from October 2018 through October 2022. These agreements were designated as cash flow hedges under the terms of the FASB authoritative guidance for derivatives and hedging. Since they were effective in offsetting the variability of the hedged cash flows, changes in the fair values of the derivatives are not included in earnings but were included in OCI. These changes in fair value were subsequently reclassified into net earnings as a component of interest expense as the hedged interest payments were made on our variable rate debt. Effective July 2, 2019, the Company terminated all interest rate swap agreements in anticipation of the securitization transaction and related retirement of our senior credit facility. The fair value of the interest rate swaps at the termination date was $23.6 million, which was required to be paid in full on July 8, 2019. As a result of the decision to extinguish the senior credit facility, forecasted cash flows associated with the variable-rate debt interest payments were no longer considered to be probable. Consequently, unrealized losses in other comprehensive income at the termination date were immediately reclassified to “Interest expense, net” in the accompanying consolidated statement of earnings. Financial performance — The following table summarizes the OCI activity related to our interest rate swap derivative instruments and the amounts reclassified from accumulated OCI ( in thousands ): Location in Income 2019 Loss recognized in OCI N/A $ (23,625) Loss reclassified from accumulated OCI into net earnings Interest expense, net $ 24,328 Amounts reclassified from accumulated OCI into interest expense represent payments made to the counterparty for the effective portions of the interest rate swaps. During the fiscal year presented, our interest rate swaps had no hedge ineffectiveness. |
Indebtedness
Indebtedness | 12 Months Ended |
Oct. 03, 2021 | |
Debt Disclosure [Abstract] | |
Indebtedness | INDEBTEDNESS The detail of our long-term debt at the end of each fiscal year is as follows ( in thousands ): 2021 2020 Class A-2-I Notes $ 570,688 $ 570,688 Class A-2-II Notes 272,938 272,938 Class A-2-III Notes 446,625 446,625 Class A-1 Variable Funding Notes — 107,876 Finance lease obligations 2,275 2,934 Total debt 1,292,526 1,401,061 Less current maturities of long-term debt (894) (818) Less unamortized debt issuance costs (18,212) (23,330) Long-term debt $ 1,273,420 $ 1,376,913 Securitized financing transaction — On July 8, 2019, Jack in the Box Funding, LLC (the “Master Issuer”), a limited-purpose, bankruptcy-remote, wholly owned indirect subsidiary of the Company, completed its securitization transaction and issued $575.0 million of its Series 2019-1 3.982% Fixed Rate Senior Secured Notes, Class A-2-I (the “Class A-2-I Notes”), $275.0 million of its Series 2019-1 4.476% Fixed Rate Senior Secured Notes, Class A-2-II (the “Class A-2-II Notes”) and $450.0 million of its Series 2019-1 4.970% Fixed Rate Senior Secured Notes, Class A-2-III (the “Class A-2-III Notes”) and together with the Class A-2-I Notes and the Class A-2-II Notes, (the “Class A-2 Notes”), in an offering exempt from registration under the Securities Act of 1933, as amended. In connection with the issuance of the Class A-2 Notes, the Master Issuer also entered into a revolving financing facility of Series 2019-1 Variable Funding Senior Secured Notes, Class A-1 (the “Variable Funding Notes”), which allows for the drawing of up to $150.0 million under the Variable Funding Notes and the issuance of letters of credit. The Class A-2 Notes and the Variable Funding Notes are referred to collectively as the “Notes.” The Notes were issued in a privately placed securitization transaction pursuant to which certain of the Company’s revenue-generating assets, consisting principally of franchise-related agreements, real estate assets, and intellectual property and license agreements for the use of intellectual property, are held by the Master Issuer and certain other limited-purpose, bankruptcy remote, wholly owned indirect subsidiaries of the Company that act as Guarantors (as defined below) of the Notes and that have pledged substantially all of their assets, excluding certain real estate assets and subject to certain limitations, to secure the Notes. The proceeds from the issuance of the Class A-2 Notes, were used to repay the remaining principal outstanding on the term loans and revolving credit facility. As a result, a loss on early extinguishment of debt of $2.8 million was recorded in fiscal 2019, primarily consisting of the write-off of unamortized deferred financing costs related to the Credit Agreement, and is reflected in “Interest expense, net” in the consolidated statement of earnings. Class A-2 Notes — Interest and principal payments on the Class A-2 Notes are payable on a quarterly basis. The quarterly principal payment of $3.25 million on the Class A-2 Notes may be suspended when the specified leverage ratio, which is a measure of outstanding debt to earnings before interest, taxes, depreciation, and amortization, adjusted for certain items (as defined in the Indenture), is less than or equal to 5.0x. Exceeding the leverage ratio of 5.0x does not violate any covenant related to the Class A-2 Notes. As of October 3, 2021, the Company’s actual leverage ratio was under 5.0x, and as a result, quarterly principal payments are not required. Accordingly, the entire outstanding balance of the Class A-2 Notes has been classified as long-term debt. The legal final maturity date of the Class A-2 Notes is in August 2049, but it is expected that, unless earlier prepaid to the extent permitted under the Indenture, the anticipated repayment dates of the Class A-2-I Notes, the Class A-2-II Notes and the Class A-2-III Notes will be August 2023, August 2026 and August 2029, respectively (the “Anticipated Repayment Dates”). If the Master Issuer has not repaid or refinanced the Class A-2 Notes prior to the respective anticipated repayment date, additional interest will accrue pursuant to the Indenture. The Class A-2 Notes are secured by the collateral described below under “Guarantees and Collateral.” Variable Funding Notes — The Variable Funding Notes were issued under the Indenture and allow for drawings on a revolving basis and the issuance of letters of credit. Depending on the type of borrowing under the Variable Funding Notes, interest on the Variable Funding Notes will be based on (i) the prime rate, (ii) overnight federal funds rates, (iii) the London interbank offered rate for U.S. Dollars or (iv) the lenders’ commercial paper funding rate plus any applicable margin, as set forth in the Variable Funding Note Purchase Agreement. There is a scaled commitment fee on the unused portion of the Variable Funding Notes facility of between 50 and 100 basis points. It is anticipated that the principal and interest on the Variable Funding Notes will be repaid in full on or prior to August 2024, subject to two one-year extensions at the option of the Company. Following the anticipated repayment date (and any extensions thereof), additional interest will accrue equal to 5.00% per annum. As of October 3, 2021 and September 27, 2020, $39.5 million of letters of credit were outstanding against the Variable Funding Notes, which relate primarily to interest reserves required under the Indenture. During the second quarter of 2020, to secure our liquidity position and provide financial flexibility given the uncertain market conditions, we borrowed $107.9 million under the Variable Funding Notes. During the second quarter of 2021, the Company fully paid down its outstanding borrowings on its Variable Funding Notes. As of October 3, 2021, unused borrowing capacity under our Variable Funding Notes was $110.5 million. Guarantees and collateral — Pursuant to the Guarantee and Collateral Agreement, dated July 8, 2019 (the “Guarantee and Collateral Agreement”), among the Guarantors, in favor of the trustee, the Guarantors guarantee the obligations of the Master Issuer under the Indenture and related documents and secure the guarantee by granting a security interest in substantially all of their assets. The Notes are secured by a security interest in substantially all of the assets of the Master Issuer and the Guarantors (collectively, the “Securitization Entities”). The assets of the Securitization Entities include most of the revenue-generating assets of the Company and its subsidiaries, which principally consist of franchise-related agreements, certain company-operated restaurants, intellectual property and license agreements for the use of intellectual property. Upon certain trigger events, mortgages will be required to be prepared and recorded on the real estate assets. Covenants and restrictions — The Notes are subject to a series of covenants and restrictions customary for transactions of this type, including (i) that the Master Issuer maintains specified reserve accounts to be used to make required payments in respect of the Notes, (ii) provisions relating to optional and mandatory prepayments and the related payment of specified amounts, including specified make-whole payments in the case of the Class A-2 Notes under certain circumstances, (iii) certain indemnification payments in the event, among other things, the assets pledged as collateral for the Notes are in stated ways defective or ineffective and (iv) covenants relating to recordkeeping, access to information and similar matters. The Notes are also subject to customary rapid amortization events provided for in the Indenture, including events tied to failure to maintain stated debt service coverage ratios, the sum of gross sales for specified restaurants being below certain levels on certain measurement dates, certain manager termination events, an event of default, and the failure to repay or refinance the Class A-2 Notes in full by the applicable anticipated repayment date. The Notes are also subject to certain customary events of default, including events relating to non-payment of required interest, principal, or other amounts due on or with respect to the Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective, and certain judgments. Deferred financing costs — In 2019, the Company incurred costs of approximately $33.0 million in connection with the securitization transaction. The costs related to our Class A-2 Notes are presented as a reduction in “Long-term debt, net of current maturities” and are being amortized over the Anticipated Repayment Dates, utilizing the effective interest rate method. The costs related to our Variable Funding Notes are presented within “Other assets, net” and are being amortized over the Anticipated Repayment Date of August 2026 using the straight-line method. As of October 3, 2021, the effective interest rates, including the amortization of debt issuance costs, were 4.545%, 4.800%, and 5.198% for the Class A-2-I Notes, Class A-2-II Notes and Class A-2-III Notes, respectively. Maturities of long-term debt — Assuming repayment by the Anticipated Repayment Dates and based on the leverage ratio as of October 3, 2021, principal payments on our long-term debt outstanding at October 3, 2021 for each of the next five fiscal years and thereafter are as follows ( in thousands ): 2022 $ 894 2023 571,610 2024 372 2025 38 2026 272,964 Thereafter 446,648 $ 1,292,526 |
Leases
Leases | 12 Months Ended |
Oct. 03, 2021 | |
Leases [Abstract] | |
Operating Leases, Lessee | LEASES Nature of leases — We own restaurant sites and we also lease restaurant sites from third parties. Some of these owned or leased sites are leased and/or subleased to franchisees. Initial terms of our real estate leases are generally 20 years, exclusive of options to renew, which are generally exercisable at our sole discretion for 1 to 20 years. In some instances, our leases have provisions for contingent rentals based upon a percentage of defined revenues. Many of our restaurants also have rent escalation clauses and require the payment of property taxes, insurance, and maintenance costs. Variable lease costs include contingent rent, cost-of-living index adjustments, and payments for additional rent such as real estate taxes, insurance, and common area maintenance, which are excluded from the measurement of the lease liability. We also lease certain restaurant and office equipment with initial terms generally ranging from 3 to 8 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. As lessor, our leases and subleases primarily consist of restaurants that have been leased to franchisees subsequent to refranchising transactions. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. Revenues from leasing arrangements with our franchisees are presented in “Franchise rental revenues” in the accompanying consolidated statements of earnings, and the related expenses are presented in “Franchise occupancy expenses.” Company as lessee — Leased assets and liabilities consisted of the following as of October 3, 2021 and September 27, 2020 (in thousands) : October 3, September 27, Assets: Operating lease ROU assets $ 934,066 $ 904,548 Finance lease ROU assets (1) 1,698 2,333 Total ROU assets $ 935,764 $ 906,881 Liabilities: Current operating lease liabilities $ 150,636 $ 179,000 Current finance lease liabilities (2) 894 818 Long-term operating lease liabilities 809,191 776,094 Long-term finance lease liabilities (2) 1,381 2,116 Total lease liabilities $ 962,102 $ 958,028 ________________________ (1) Included in “Property and equipment, net” on our consolidated balance sheets. (2) Included in “Current maturities of long-term debt” and “Long-term debt, net of current maturities” on our consolidated balance sheets. The following table presents the components of our lease costs in fiscal 2021 and 2020 ( in thousands ): 2021 2020 Lease costs: Finance lease cost: Amortization of ROU assets (1) $ 807 $ 767 Interest on lease liabilities (2) 89 110 Operating lease cost (3) 194,149 190,461 Short-term lease cost (3) 427 175 Variable lease cost (3)(4) 43,498 40,798 $ 238,970 $ 232,311 ____________________________ (1) Included in “Depreciation and amortization” in our consolidated statement of earnings. (2) Included in “Interest expense, net” in our consolidated statement of earnings. (3) Operating lease, short-term and variable lease costs associated with franchisees and company-operated restaurants are included in “Franchise occupancy expenses” and “Occupancy and other,” respectively, in our consolidated statement of earnings. For our closed restaurants, these costs are included in “Impairment and other (gains) charges, net” and all other costs are included in “Selling, general and administrative expenses.” (4) Includes $38.0 million and $37.4 million in 2021 and 2020, respectively, of property taxes and common area maintenance costs which are reimbursed by sub-lessees. The following table summarizes the components of rent expense in fiscal 2019, as accounted for under previous guidance ( in thousands ): 2019 Minimum rentals 184,587 Contingent rentals 2,255 Total rent expense 186,842 The following table presents supplemental information related to leases: October 3, September 27, Weighted-average remaining lease term (in years): Finance leases 2.4 3.3 Operating leases 9.0 8.3 Weighted-average discount rate: Finance leases 3.6 % 3.5 % Operating leases 4.1 % 4.2 % The following table presents as of October 3, 2021, the annual maturities of our lease liabilities ( in thousands ): Finance Leases Operating Leases Fiscal year: 2022 $ 961 $ 186,717 2023 944 161,788 2024 413 128,816 2025 50 122,114 2026 25 106,582 Thereafter 27 460,138 Total future lease payments (1) $ 2,420 $ 1,166,155 Less: imputed interest (145) (206,328) Present value of lease liabilities $ 2,275 $ 959,827 Less current portion (894) (150,636) Long-term lease obligations $ 1,381 $ 809,191 ________________________ (1) Total future lease payments include non-cancellable commitments of $2.4 million for finance leases and $1,000.0 million for operating leases. Assets recorded under finance leases are included in property and equipment, and consisted of the following at each fiscal year-end ( in thousands ): 2021 2020 Buildings 1,342 1,342 Equipment 5,869 5,631 Less accumulated amortization (5,513) (4,640) 1,698 2,333 The following table includes supplemental cash flow and non-cash information related to our lessee leases ( in thousands ): 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 218,570 $ 190,303 Operating cash flows from financing leases $ 89 $ 110 Financing cash flows from financing leases $ 829 $ 785 Supplemental noncash information on lease liabilities arising from obtaining right-of-use assets: Right-of-use assets obtained in exchange for new operating lease obligations $ 186,621 $ 181,532 Right-of-use assets obtained in exchange for new financing lease obligations $ 184 $ 132 Sale and leaseback transactions — In fiscal 2021, we sold two restaurant properties in sale and leaseback transactions for net proceeds of $3.9 million and recorded total gains of less than $0.1 million. The leases have been accounted for as operating leases and contain an initial term of 20 years. In fiscal 2020, we completed two sale and leaseback transactions of our restaurant properties with one occurring during the first quarter of 2020 and the other occurring during the third quarter of 2020. In the first quarter of 2020, we completed a sale leaseback transaction of a multi-tenant commercial property in Los Angeles, California and leased back the parcel on which a company-operated restaurant is located. The Company received net proceeds of $17.4 million and recognized a $0.2 million loss on the sale. The initial term on the lease is 20 years and the lease has been accounted for as an operating lease. Under the other arrangement, we received net proceeds of $2.4 million on a restaurant property sold and recognized a loss of less than $0.1 million on the sale. The initial term of the lease is 17 years and has been accounted for as an operating lease. In fiscal 2020, we also completed the sale of one of our corporate office buildings as we moved forward with our previously announced consolidation of our headquarters. We entered into a lease with the buyer to leaseback the property for up to 18 months with an option to terminate earlier without penalty, upon providing a 90-day notice. The net proceeds received on the sale were $20.6 million and the lease has been accounted for as an operating lease. A gain on the sale of $10.8 million was recognized and is presented within “Impairment and other (gains) charges, net” in our consolidated statement of earnings. Company as lessor — The following table presents rental income ( in thousands ): 2021 2020 Owned Properties Leased Properties Total Owned Properties Leased Properties Total Operating lease income - franchise $ 20,132 $ 218,028 $ 238,160 $ 19,785 $ 216,015 $ 235,800 Variable lease income - franchise 12,363 96,111 108,474 9,960 74,887 84,847 Franchise rental revenues $ 32,495 $ 314,139 $ 346,634 $ 29,745 $ 290,902 $ 320,647 Operating lease income - closed restaurants and other (1) $ — $ 6,027 $ 6,027 $ — $ 6,370 $ 6,370 ________________________ (1) Primarily relates to closed restaurant properties included in “Impairment and other (gains) charges, net” in our consolidated statement of earnings. The following table presents as of October 3, 2021, future minimum rental receipts for non-cancellable leases and subleases ( in thousands ): October 3, Fiscal year: 2022 $ 238,021 2023 231,342 2024 205,740 2025 214,526 2026 199,906 Thereafter 939,239 Total minimum rental receipts $ 2,028,774 Assets held for lease and included in property and equipment consisted of the following at each fiscal year-end ( in thousands ): October 3, September 27, Land $ 89,791 $ 88,187 Buildings 782,450 801,730 Equipment 223 589 872,464 890,506 Less accumulated depreciation (657,030) (650,812) $ 215,434 $ 239,694 |
Finance Leases, Lessee | LEASES Nature of leases — We own restaurant sites and we also lease restaurant sites from third parties. Some of these owned or leased sites are leased and/or subleased to franchisees. Initial terms of our real estate leases are generally 20 years, exclusive of options to renew, which are generally exercisable at our sole discretion for 1 to 20 years. In some instances, our leases have provisions for contingent rentals based upon a percentage of defined revenues. Many of our restaurants also have rent escalation clauses and require the payment of property taxes, insurance, and maintenance costs. Variable lease costs include contingent rent, cost-of-living index adjustments, and payments for additional rent such as real estate taxes, insurance, and common area maintenance, which are excluded from the measurement of the lease liability. We also lease certain restaurant and office equipment with initial terms generally ranging from 3 to 8 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. As lessor, our leases and subleases primarily consist of restaurants that have been leased to franchisees subsequent to refranchising transactions. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. Revenues from leasing arrangements with our franchisees are presented in “Franchise rental revenues” in the accompanying consolidated statements of earnings, and the related expenses are presented in “Franchise occupancy expenses.” Company as lessee — Leased assets and liabilities consisted of the following as of October 3, 2021 and September 27, 2020 (in thousands) : October 3, September 27, Assets: Operating lease ROU assets $ 934,066 $ 904,548 Finance lease ROU assets (1) 1,698 2,333 Total ROU assets $ 935,764 $ 906,881 Liabilities: Current operating lease liabilities $ 150,636 $ 179,000 Current finance lease liabilities (2) 894 818 Long-term operating lease liabilities 809,191 776,094 Long-term finance lease liabilities (2) 1,381 2,116 Total lease liabilities $ 962,102 $ 958,028 ________________________ (1) Included in “Property and equipment, net” on our consolidated balance sheets. (2) Included in “Current maturities of long-term debt” and “Long-term debt, net of current maturities” on our consolidated balance sheets. The following table presents the components of our lease costs in fiscal 2021 and 2020 ( in thousands ): 2021 2020 Lease costs: Finance lease cost: Amortization of ROU assets (1) $ 807 $ 767 Interest on lease liabilities (2) 89 110 Operating lease cost (3) 194,149 190,461 Short-term lease cost (3) 427 175 Variable lease cost (3)(4) 43,498 40,798 $ 238,970 $ 232,311 ____________________________ (1) Included in “Depreciation and amortization” in our consolidated statement of earnings. (2) Included in “Interest expense, net” in our consolidated statement of earnings. (3) Operating lease, short-term and variable lease costs associated with franchisees and company-operated restaurants are included in “Franchise occupancy expenses” and “Occupancy and other,” respectively, in our consolidated statement of earnings. For our closed restaurants, these costs are included in “Impairment and other (gains) charges, net” and all other costs are included in “Selling, general and administrative expenses.” (4) Includes $38.0 million and $37.4 million in 2021 and 2020, respectively, of property taxes and common area maintenance costs which are reimbursed by sub-lessees. The following table summarizes the components of rent expense in fiscal 2019, as accounted for under previous guidance ( in thousands ): 2019 Minimum rentals 184,587 Contingent rentals 2,255 Total rent expense 186,842 The following table presents supplemental information related to leases: October 3, September 27, Weighted-average remaining lease term (in years): Finance leases 2.4 3.3 Operating leases 9.0 8.3 Weighted-average discount rate: Finance leases 3.6 % 3.5 % Operating leases 4.1 % 4.2 % The following table presents as of October 3, 2021, the annual maturities of our lease liabilities ( in thousands ): Finance Leases Operating Leases Fiscal year: 2022 $ 961 $ 186,717 2023 944 161,788 2024 413 128,816 2025 50 122,114 2026 25 106,582 Thereafter 27 460,138 Total future lease payments (1) $ 2,420 $ 1,166,155 Less: imputed interest (145) (206,328) Present value of lease liabilities $ 2,275 $ 959,827 Less current portion (894) (150,636) Long-term lease obligations $ 1,381 $ 809,191 ________________________ (1) Total future lease payments include non-cancellable commitments of $2.4 million for finance leases and $1,000.0 million for operating leases. Assets recorded under finance leases are included in property and equipment, and consisted of the following at each fiscal year-end ( in thousands ): 2021 2020 Buildings 1,342 1,342 Equipment 5,869 5,631 Less accumulated amortization (5,513) (4,640) 1,698 2,333 The following table includes supplemental cash flow and non-cash information related to our lessee leases ( in thousands ): 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 218,570 $ 190,303 Operating cash flows from financing leases $ 89 $ 110 Financing cash flows from financing leases $ 829 $ 785 Supplemental noncash information on lease liabilities arising from obtaining right-of-use assets: Right-of-use assets obtained in exchange for new operating lease obligations $ 186,621 $ 181,532 Right-of-use assets obtained in exchange for new financing lease obligations $ 184 $ 132 Sale and leaseback transactions — In fiscal 2021, we sold two restaurant properties in sale and leaseback transactions for net proceeds of $3.9 million and recorded total gains of less than $0.1 million. The leases have been accounted for as operating leases and contain an initial term of 20 years. In fiscal 2020, we completed two sale and leaseback transactions of our restaurant properties with one occurring during the first quarter of 2020 and the other occurring during the third quarter of 2020. In the first quarter of 2020, we completed a sale leaseback transaction of a multi-tenant commercial property in Los Angeles, California and leased back the parcel on which a company-operated restaurant is located. The Company received net proceeds of $17.4 million and recognized a $0.2 million loss on the sale. The initial term on the lease is 20 years and the lease has been accounted for as an operating lease. Under the other arrangement, we received net proceeds of $2.4 million on a restaurant property sold and recognized a loss of less than $0.1 million on the sale. The initial term of the lease is 17 years and has been accounted for as an operating lease. In fiscal 2020, we also completed the sale of one of our corporate office buildings as we moved forward with our previously announced consolidation of our headquarters. We entered into a lease with the buyer to leaseback the property for up to 18 months with an option to terminate earlier without penalty, upon providing a 90-day notice. The net proceeds received on the sale were $20.6 million and the lease has been accounted for as an operating lease. A gain on the sale of $10.8 million was recognized and is presented within “Impairment and other (gains) charges, net” in our consolidated statement of earnings. Company as lessor — The following table presents rental income ( in thousands ): 2021 2020 Owned Properties Leased Properties Total Owned Properties Leased Properties Total Operating lease income - franchise $ 20,132 $ 218,028 $ 238,160 $ 19,785 $ 216,015 $ 235,800 Variable lease income - franchise 12,363 96,111 108,474 9,960 74,887 84,847 Franchise rental revenues $ 32,495 $ 314,139 $ 346,634 $ 29,745 $ 290,902 $ 320,647 Operating lease income - closed restaurants and other (1) $ — $ 6,027 $ 6,027 $ — $ 6,370 $ 6,370 ________________________ (1) Primarily relates to closed restaurant properties included in “Impairment and other (gains) charges, net” in our consolidated statement of earnings. The following table presents as of October 3, 2021, future minimum rental receipts for non-cancellable leases and subleases ( in thousands ): October 3, Fiscal year: 2022 $ 238,021 2023 231,342 2024 205,740 2025 214,526 2026 199,906 Thereafter 939,239 Total minimum rental receipts $ 2,028,774 Assets held for lease and included in property and equipment consisted of the following at each fiscal year-end ( in thousands ): October 3, September 27, Land $ 89,791 $ 88,187 Buildings 782,450 801,730 Equipment 223 589 872,464 890,506 Less accumulated depreciation (657,030) (650,812) $ 215,434 $ 239,694 |
Operating Leases, Lessor | LEASES Nature of leases — We own restaurant sites and we also lease restaurant sites from third parties. Some of these owned or leased sites are leased and/or subleased to franchisees. Initial terms of our real estate leases are generally 20 years, exclusive of options to renew, which are generally exercisable at our sole discretion for 1 to 20 years. In some instances, our leases have provisions for contingent rentals based upon a percentage of defined revenues. Many of our restaurants also have rent escalation clauses and require the payment of property taxes, insurance, and maintenance costs. Variable lease costs include contingent rent, cost-of-living index adjustments, and payments for additional rent such as real estate taxes, insurance, and common area maintenance, which are excluded from the measurement of the lease liability. We also lease certain restaurant and office equipment with initial terms generally ranging from 3 to 8 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. As lessor, our leases and subleases primarily consist of restaurants that have been leased to franchisees subsequent to refranchising transactions. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. Revenues from leasing arrangements with our franchisees are presented in “Franchise rental revenues” in the accompanying consolidated statements of earnings, and the related expenses are presented in “Franchise occupancy expenses.” Company as lessee — Leased assets and liabilities consisted of the following as of October 3, 2021 and September 27, 2020 (in thousands) : October 3, September 27, Assets: Operating lease ROU assets $ 934,066 $ 904,548 Finance lease ROU assets (1) 1,698 2,333 Total ROU assets $ 935,764 $ 906,881 Liabilities: Current operating lease liabilities $ 150,636 $ 179,000 Current finance lease liabilities (2) 894 818 Long-term operating lease liabilities 809,191 776,094 Long-term finance lease liabilities (2) 1,381 2,116 Total lease liabilities $ 962,102 $ 958,028 ________________________ (1) Included in “Property and equipment, net” on our consolidated balance sheets. (2) Included in “Current maturities of long-term debt” and “Long-term debt, net of current maturities” on our consolidated balance sheets. The following table presents the components of our lease costs in fiscal 2021 and 2020 ( in thousands ): 2021 2020 Lease costs: Finance lease cost: Amortization of ROU assets (1) $ 807 $ 767 Interest on lease liabilities (2) 89 110 Operating lease cost (3) 194,149 190,461 Short-term lease cost (3) 427 175 Variable lease cost (3)(4) 43,498 40,798 $ 238,970 $ 232,311 ____________________________ (1) Included in “Depreciation and amortization” in our consolidated statement of earnings. (2) Included in “Interest expense, net” in our consolidated statement of earnings. (3) Operating lease, short-term and variable lease costs associated with franchisees and company-operated restaurants are included in “Franchise occupancy expenses” and “Occupancy and other,” respectively, in our consolidated statement of earnings. For our closed restaurants, these costs are included in “Impairment and other (gains) charges, net” and all other costs are included in “Selling, general and administrative expenses.” (4) Includes $38.0 million and $37.4 million in 2021 and 2020, respectively, of property taxes and common area maintenance costs which are reimbursed by sub-lessees. The following table summarizes the components of rent expense in fiscal 2019, as accounted for under previous guidance ( in thousands ): 2019 Minimum rentals 184,587 Contingent rentals 2,255 Total rent expense 186,842 The following table presents supplemental information related to leases: October 3, September 27, Weighted-average remaining lease term (in years): Finance leases 2.4 3.3 Operating leases 9.0 8.3 Weighted-average discount rate: Finance leases 3.6 % 3.5 % Operating leases 4.1 % 4.2 % The following table presents as of October 3, 2021, the annual maturities of our lease liabilities ( in thousands ): Finance Leases Operating Leases Fiscal year: 2022 $ 961 $ 186,717 2023 944 161,788 2024 413 128,816 2025 50 122,114 2026 25 106,582 Thereafter 27 460,138 Total future lease payments (1) $ 2,420 $ 1,166,155 Less: imputed interest (145) (206,328) Present value of lease liabilities $ 2,275 $ 959,827 Less current portion (894) (150,636) Long-term lease obligations $ 1,381 $ 809,191 ________________________ (1) Total future lease payments include non-cancellable commitments of $2.4 million for finance leases and $1,000.0 million for operating leases. Assets recorded under finance leases are included in property and equipment, and consisted of the following at each fiscal year-end ( in thousands ): 2021 2020 Buildings 1,342 1,342 Equipment 5,869 5,631 Less accumulated amortization (5,513) (4,640) 1,698 2,333 The following table includes supplemental cash flow and non-cash information related to our lessee leases ( in thousands ): 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 218,570 $ 190,303 Operating cash flows from financing leases $ 89 $ 110 Financing cash flows from financing leases $ 829 $ 785 Supplemental noncash information on lease liabilities arising from obtaining right-of-use assets: Right-of-use assets obtained in exchange for new operating lease obligations $ 186,621 $ 181,532 Right-of-use assets obtained in exchange for new financing lease obligations $ 184 $ 132 Sale and leaseback transactions — In fiscal 2021, we sold two restaurant properties in sale and leaseback transactions for net proceeds of $3.9 million and recorded total gains of less than $0.1 million. The leases have been accounted for as operating leases and contain an initial term of 20 years. In fiscal 2020, we completed two sale and leaseback transactions of our restaurant properties with one occurring during the first quarter of 2020 and the other occurring during the third quarter of 2020. In the first quarter of 2020, we completed a sale leaseback transaction of a multi-tenant commercial property in Los Angeles, California and leased back the parcel on which a company-operated restaurant is located. The Company received net proceeds of $17.4 million and recognized a $0.2 million loss on the sale. The initial term on the lease is 20 years and the lease has been accounted for as an operating lease. Under the other arrangement, we received net proceeds of $2.4 million on a restaurant property sold and recognized a loss of less than $0.1 million on the sale. The initial term of the lease is 17 years and has been accounted for as an operating lease. In fiscal 2020, we also completed the sale of one of our corporate office buildings as we moved forward with our previously announced consolidation of our headquarters. We entered into a lease with the buyer to leaseback the property for up to 18 months with an option to terminate earlier without penalty, upon providing a 90-day notice. The net proceeds received on the sale were $20.6 million and the lease has been accounted for as an operating lease. A gain on the sale of $10.8 million was recognized and is presented within “Impairment and other (gains) charges, net” in our consolidated statement of earnings. Company as lessor — The following table presents rental income ( in thousands ): 2021 2020 Owned Properties Leased Properties Total Owned Properties Leased Properties Total Operating lease income - franchise $ 20,132 $ 218,028 $ 238,160 $ 19,785 $ 216,015 $ 235,800 Variable lease income - franchise 12,363 96,111 108,474 9,960 74,887 84,847 Franchise rental revenues $ 32,495 $ 314,139 $ 346,634 $ 29,745 $ 290,902 $ 320,647 Operating lease income - closed restaurants and other (1) $ — $ 6,027 $ 6,027 $ — $ 6,370 $ 6,370 ________________________ (1) Primarily relates to closed restaurant properties included in “Impairment and other (gains) charges, net” in our consolidated statement of earnings. The following table presents as of October 3, 2021, future minimum rental receipts for non-cancellable leases and subleases ( in thousands ): October 3, Fiscal year: 2022 $ 238,021 2023 231,342 2024 205,740 2025 214,526 2026 199,906 Thereafter 939,239 Total minimum rental receipts $ 2,028,774 Assets held for lease and included in property and equipment consisted of the following at each fiscal year-end ( in thousands ): October 3, September 27, Land $ 89,791 $ 88,187 Buildings 782,450 801,730 Equipment 223 589 872,464 890,506 Less accumulated depreciation (657,030) (650,812) $ 215,434 $ 239,694 |
Impairment and Other (Gains) Ch
Impairment and Other (Gains) Charges, Net | 12 Months Ended |
Oct. 03, 2021 | |
Restructuring and Related Activities [Abstract] | |
Impairment and Other (Gains) Charges, Net | IMPAIRMENT AND OTHER (GAINS) CHARGES, NET Impairment and other (gains) charges, net, in the accompanying consolidated statements of earnings is comprised of the following in each fiscal year ( in thousands ): 2021 2020 2019 Gains on disposition of property and equipment, net (1) (6,888) (9,768) (6,244) Costs of closed restaurants and other (2) 1,907 1,872 8,628 Accelerated depreciation (3) 1,592 235 1,616 Restructuring costs (4) 7 1,168 8,455 $ (3,382) $ (6,493) $ 12,455 ________________________ (1) In 2021, 2020 and 2019 gains on disposition of property and equipment primarily related to the sales of restaurant properties, in addition to the sale of one of our corporate office buildings in 2020. (2) In 2021, 2020 and 2019 costs of closed restaurants primarily include lease termination and impairment charges on future lease commitments and expected ancillary cost, net of anticipated sublease rentals, as a result of our decision to close restaurants, ongoing costs associated with closed restaurants, and canceled project costs. (3) In 2021, 2020, and 2019 accelerated depreciation primarily related to facility improvements, restaurant remodels, and information technology assets. (4) In 2020 and 2019 restructuring costs include charges resulting from a plan that management initiated to reduce our general and administrative costs, which was completed in the third quarter of 2020. In fiscal 2019, charges also include costs resulting from the exploration of strategic alternatives, which was concluded in the third quarter of 2019. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Oct. 03, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | DISCONTINUED OPERATIONS Qdoba — In December 2017, we entered into a stock purchase agreement (the “Qdoba Purchase Agreement”) with the Buyer to sell all issued and outstanding shares of Qdoba. The Buyer completed the acquisition of Qdoba on March 21, 2018 (the “Qdoba Sale”). We also entered into a Transition Services Agreement with the Buyer pursuant to which the Buyer received certain services (the “Services”) to enable it to operate the Qdoba business after the closing of the Qdoba Sale. The Services included information technology, finance and accounting, human resources, supply chain and other corporate support services. Under the Agreement, the Services were provided at cost for a period of up to 12 months, with two 3-month extensions available for certain services. As of September 21, 2019, we are no longer providing transition services to Qdoba. In 2019, we recorded $7.0 million in income related to the Services as a reduction of “Selling, general, and administrative expenses” in the consolidated statements of earnings. The following table presents results of operations in periods which have been included in discontinued operations (in thousands): 2020 2019 Total revenues $ — $ — Total cost and (income) expense (1) (514) 173 Earnings (losses) before income taxes 514 (173) Income tax expense (benefit) (2) 144 (2,863) Earnings from discontinued operations, net of income taxes $ 370 $ 2,690 ________________________ (1) Amounts in 2020 and 2019 include resolutions of certain contingencies that existed at the date of sale which were insignificant in nature. (2) In fiscal 2019, the Company entered into a bilateral California election with Quidditch Acquisition, Inc. to retroactively treat the divestment of Qdoba Restaurant Corporation on March 21, 2018 as a sale of assets instead of a stock sale for income tax purposes. This election reduced the Company’s fiscal year 2018 California tax liability on the divestment by $2.8 million. |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 03, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Income taxes consist of the following in each fiscal year ( in thousands ): 2021 2020 2019 Current: Federal $ 36,051 $ 19,721 $ 14,683 State 11,793 7,844 5,242 47,844 27,565 19,925 Deferred: Federal 4,440 4,625 3,750 State 3,568 537 350 8,008 5,162 4,100 Income tax expense from continuing operations $ 55,852 $ 32,727 $ 24,025 Income tax expense (benefit) from discontinued operations $ — $ 144 $ (2,863) A reconciliation of the federal statutory income tax rate to our effective tax rate for continuing operations is as follows: 2021 2020 2019 Income tax expense at federal statutory rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal tax benefit 5.1 % 5.3 % 5.3 % Stock compensation excess tax benefit (0.5) % (0.4) % (0.1) % Benefit of jobs tax credits, net of valuation allowance (0.1) % (0.5) % (0.3) % Release of federal tax liability — % — % (0.6) % Adjustment to state tax provision 0.7 % — % (0.9) % Benefit related to COLIs (1.5) % (0.9) % (1.0) % Termination of interest rate swaps — % — % (2.6) % Officers’ compensation limitation 0.5 % 2.2 % 1.1 % Other, net — % 0.1 % (1.1) % 25.2 % 26.8 % 20.8 % The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities at each fiscal year-end are presented below ( in thousands ): 2021 2020 Deferred tax assets: Operating and finance lease liabilities $ 237,509 $ 234,926 Accrued defined benefit pension and postretirement benefits 28,837 44,436 Deferred income 12,083 12,921 Impairment 6,957 8,895 Accrued insurance 5,389 6,500 Other reserves and allowances 4,050 2,440 Share-based compensation 4,039 4,143 Accrued incentive compensation 3,455 2,585 Tax loss and tax credit carryforwards 3,129 4,273 Accrued compensation expense 710 672 Other, net 3,424 2,364 Total gross deferred tax assets 309,582 324,155 Valuation allowance (1,349) (2,104) Total net deferred tax assets 308,233 322,051 Deferred tax liabilities: Operating and finance lease ROU assets (242,038) (235,373) Intangible assets (11,349) (11,437) Property and equipment, principally due to differences in depreciation (1,036) (1,781) Other (2,293) (1,138) Total gross deferred tax liabilities (256,716) (249,729) Net deferred tax assets $ 51,517 $ 72,322 Deferred tax assets as of October 3, 2021 include state net operating loss carryforwards of approximately $16.6 million, of which $12.1 million has an indefinite carryforward. The remainder will expire at various times between 2022 and 2038. At October 3, 2021, we recorded a valuation allowance of $1.3 million related to state tax credits, which decreased from the $2.1 million at September 27, 2020 due to the release of the valuation allowance on California Enterprise Zone Credits and state net operating loss carryforwards. We believe it is more likely than not that these credit carryforwards will not be realized and that all other deferred tax assets will be realized through future taxable income or alternative tax strategies. The major jurisdictions in which the Company files income tax returns include the United States and states in which we operate that impose an income tax. The federal statutes of limitations have not expired for fiscal years 2018 and forward. The statutes of limitations for California and Texas, which constitute the Company’s major state tax jurisdictions, have not expired for fiscal years 2017 and forward. |
Retirement Plans
Retirement Plans | 12 Months Ended |
Oct. 03, 2021 | |
Retirement Benefits [Abstract] | |
Retirement Plans | RETIREMENT PLANS We sponsor programs that provide retirement benefits to our employees. These programs include defined contribution plans, defined benefit pension plans, and postretirement healthcare plans. Defined contribution plans — We maintain a qualified savings plan pursuant to Section 401(k) of the Internal Revenue Code (“IRC”). The plan allows all employees who have satisfied the service requirements and reached age 21 to defer a percentage of their pay on a pre-tax basis. Beginning January 1, 2016, we match 100% of the first 4% of compensation deferred by the participant. A participant’s right to Company contributions vest immediately. Our contributions under this plan were $1.6 million in fiscal 2021, and $1.6 million and $1.7 million in fiscal 2020 and 2019, respectively. We also maintain an unfunded, non-qualified deferred compensation plan for key executives and other members of management whose compensation deferrals or company matching contributions to the qualified savings plan are limited due to IRC rules. Effective January 1, 2016, this non-qualified plan was amended to replace the company matching contribution with an annual restoration match that is intended to “restore” up to the full match for participants whose elective deferrals (and related company matching contributions) to the qualified savings plan were limited due to IRC rules. A participant’s right to the Company restoration match vests immediately. This plan allows participants to defer up to 50% of their salary and 85% of their bonus, on a pre-tax basis. Our contributions under the non-qualified deferred compensation plan were less than $0.1 million in fiscal 2021, $0.3 million and $0.2 million in fiscal 2020 and 2019, respectively. Defined benefit pension plans — We sponsor two defined benefit pension plans, a “Qualified Plan” covering substantially all full-time employees hired prior to January 1, 2011, and an unfunded supplemental executive retirement plan (“SERP”) which provides certain employees additional pension benefits and was closed to new participants effective January 1, 2007. In fiscal 2011, the Board of Directors approved changes to our Qualified Plan whereby participants will no longer accrue benefits effective December 31, 2015. Benefits under both plans are based on the employees’ years of service and compensation over defined periods of employment. In the fiscal fourth quarter of 2019, the Company amended its Qualified Plan to add a limited lump sum payment window whereby certain terminated participants with a vested pension benefit could elect to receive either an immediate lump sum or a monthly annuity payment of their accrued benefit. The offering period began September 16, 2019 and ended October 31, 2019. The participants that elected a lump sum benefit under the program were paid in December 2019, which triggered settlement accounting. As a result of the offering, the Company’s Qualified Plan paid $122.3 million from its plan assets to those who accepted the offer, thereby reducing the plan’s pension benefit obligation (“PBO”). The transaction had no cash impact to the Company but did result in a non-cash settlement charge of $38.6 million in the first quarter of fiscal 2020. Routine lump sum payments made in the second, third and fourth quarters of fiscal 2020 resulted in additional non-cash settlement charges totaling $0.6 million. Postretirement healthcare plans — We also sponsor two healthcare plans, closed to new participants, that provide postretirement medical benefits to certain employees who have met minimum age and service requirements. The plans are contributory, with retiree contributions adjusted annually, and contain other cost-sharing features such as deductibles and coinsurance. Obligations and funded status — The following table provides a reconciliation of the changes in benefit obligations, plan assets, and funded status of our retirement plans for each fiscal year ( in thousands ): Qualified Plan SERP Postretirement Health Plans 2021 2020 2021 2020 2021 2020 Change in benefit obligation: Obligation at beginning of year $ 412,573 $ 521,931 $ 78,971 $ 79,893 $ 20,965 $ 25,632 Interest cost 12,558 13,377 2,169 2,499 563 807 Participant contributions — — — — 112 106 Actuarial (gain) loss (785) 14,498 (672) 1,739 (3,525) (4,391) Benefits paid (14,293) (12,980) (5,243) (5,160) (1,044) (1,246) Settlements — (124,253) — — — — Other — — — — 91 57 Obligation at end of year $ 410,053 $ 412,573 $ 75,225 $ 78,971 $ 17,162 $ 20,965 Change in plan assets: Fair value at beginning of year $ 365,510 $ 476,194 $ — $ — $ — $ — Actual return on plan assets 58,491 26,549 — — — — Participant contributions — — — — 112 106 Employer contributions — — 5,243 5,160 841 1,083 Benefits paid (14,293) (12,980) (5,243) (5,160) (1,044) (1,246) Settlements — (124,253) — — — — Other — — — — 91 57 Fair value at end of year $ 409,708 $ 365,510 $ — $ — $ — $ — Unfunded status at end of year $ (345) $ (47,063) $ (75,225) $ (78,971) $ (17,162) $ (20,965) Amounts recognized on the balance sheet: Current liabilities $ — $ — $ (5,216) $ (5,223) $ (1,115) $ (1,243) Noncurrent liabilities (345) (47,063) (70,009) (73,748) (16,047) (19,722) Total liability recognized $ (345) $ (47,063) $ (75,225) $ (78,971) $ (17,162) $ (20,965) Amounts in AOCI not yet reflected in net periodic benefit cost: Unamortized actuarial loss (gain), net $ 108,922 $ 152,370 $ 32,475 $ 34,890 $ (7,359) $ (4,174) Unamortized prior service cost — — 53 72 — — Total $ 108,922 $ 152,370 $ 32,528 $ 34,962 $ (7,359) $ (4,174) Other changes in plan assets and benefit obligations recognized in OCI: Net actuarial (gain) loss $ (39,936) $ 7,527 $ (672) $ 1,739 $ (3,526) $ (4,391) Pension settlement costs — (39,218) — — — — Amortization of actuarial (loss) gain (3,510) (3,644) (1,743) (1,652) 341 (18) Amortization of prior service cost — — (19) (85) — — Total recognized in OCI (43,446) (35,335) (2,434) 2 (3,185) (4,409) Net periodic benefit (credit) cost and other losses (3,272) 36,661 3,931 4,236 222 825 Total recognized in comprehensive income $ (46,718) $ 1,326 $ 1,497 $ 4,238 $ (2,963) $ (3,584) Amounts in AOCI expected to be amortized in fiscal 2022 net periodic benefit cost: Net actuarial loss (gain) $ 2,193 $ 1,666 $ (640) Prior service cost — 19 — Total $ 2,193 $ 1,685 $ (640) Additional year-end pension plan information — The PBO is the actuarial present value of benefits attributable to employee service rendered to date, including the effects of estimated future pay increases. The accumulated benefit obligation (“ABO”) also reflects the actuarial present value of benefits attributable to employee service rendered to date but does not include the effects of estimated future pay increases. Therefore, the ABO as compared to plan assets is an indication of the assets currently available to fund vested and nonvested benefits accrued through the end of the fiscal year. The funded status is measured as the difference between the fair value of a plan’s assets and its PBO. As of October 3, 2021 and September 27, 2020, the Qualified Plan’s ABO exceeded the fair value of its plan assets. The SERP is an unfunded plan and, as such, had no plan assets as of October 3, 2021 and September 27, 2020. The following sets forth the PBO, ABO, and fair value of plan assets of our pension plans as of the measurement date in each fiscal year ( in thousands ): 2021 2020 Qualified Plan: Projected benefit obligation $ 410,053 $ 412,573 Accumulated benefit obligation $ 410,053 $ 412,573 Fair value of plan assets $ 409,708 $ 365,510 SERP: Projected benefit obligation $ 75,225 $ 78,971 Accumulated benefit obligation $ 75,225 $ 78,971 Fair value of plan assets $ — $ — Net periodic benefit cost — The components of the fiscal year net periodic benefit cost were as follows ( in thousands ): 2021 2020 2019 Qualified Plan: Interest cost $ 12,558 $ 13,377 $ 19,825 Expected return on plan assets (19,340) (19,578) (26,334) Pension settlements — 39,218 — Actuarial loss 3,510 3,644 2,754 Net periodic benefit (credit) cost $ (3,272) $ 36,661 $ (3,755) SERP: Interest cost $ 2,169 $ 2,499 $ 3,080 Actuarial loss 1,743 1,652 1,207 Amortization of unrecognized prior service cost 19 85 115 Net periodic benefit cost $ 3,931 $ 4,236 $ 4,402 Postretirement health plans: Interest cost $ 563 $ 807 $ 997 Actuarial (gain) loss (341) 18 (159) Net periodic benefit cost $ 222 $ 825 $ 838 Prior service costs are amortized on a straight-line basis from date of participation to full eligibility. Unrecognized gains or losses are amortized using the “corridor approach” under which the net gain or loss in excess of 10% of the greater of the PBO or the market-related value of the assets, if applicable, is amortized. For our Qualified Plan, actuarial losses are amortized over the average future expected lifetime of all participants expected to receive benefits. For our SERP, actuarial losses are amortized over the expected remaining future lifetime for inactive participants, and for our postretirement health plans, actuarial losses are amortized over the expected remaining future lifetime of inactive participants expected to receive benefits. Assumptions — We determine our actuarial assumptions on an annual basis. In determining the present values of our benefit obligations and net periodic benefit costs as of and for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019, we used the following weighted-average assumptions: 2021 2020 2019 Assumptions used to determine benefit obligations (1): Qualified Plan: Discount rate 3.11% 3.10% 3.36% SERP: Discount rate 2.99% 2.84% 3.24% Rate of future pay increases (2) N/A N/A 3.50% Postretirement health plans: Discount rate 2.95% 2.77% 3.24% Assumptions used to determine net periodic benefit cost (3): Qualified Plan: Discount rate (4) 3.10% 3.36% 4.40% Long-term rate of return on assets (5) 5.40% 5.80% 5.85% SERP: Discount rate 2.84% 3.24% 4.37% Rate of future pay increases (2) N/A 3.50% 3.50% Postretirement health plans: Discount rate 2.77% 3.24% 4.38% ________________________ (1) Determined as of end of year. (2) Rate is not applicable as there are no active employees as of fiscal year end 2020 and 2021. (3) Determined as of beginning of year. (4) Remeasurements were performed in the first, second, and third quarters of fiscal 2020 using 3.61%, 3.38%, and 3.13% respectively. (5) Remeasurements were performed in the first, second, and third quarters of fiscal 2020 using 5.9%, 5.2%, and 5.4% respectively. The assumed discount rates were determined by considering the average of pension yield curves constructed of a population of high-quality bonds with a Moody’s or Standard and Poor’s rating of “AA” or better whose cash flow from coupons and maturities match the year-by-year projected benefit payments from the plans. As benefit payments typically extend beyond the date of the longest maturing bond, cash flows beyond 30 years were discounted back to the 30th year and then matched like any other payment. The assumed expected long-term rate of return on assets is the weighted-average rate of earnings expected on the funds invested or to be invested to provide for the pension obligations. The long-term rate of return on assets was determined taking into consideration our projected asset allocation and economic forecasts prepared with the assistance of our actuarial consultants. The assumed discount rate and expected long-term rate of return on assets have a significant effect on amounts reported for our pension and postretirement plans. If the discount rate and long-term rate of return used were decreased by a quarter percentage point, fiscal 2021 earnings before income taxes would have decreased by less than $0.1 million and increased by $0.9 million, respectively. The assumed average rate of compensation increase is the average annual compensation increase expected over the remaining employment periods for the participating employees. For our Qualified Plan, no future pay increases were included in our benefit obligation assumptions as, effective December 31, 2015, our plan participants no longer accrue benefits. For measurement purposes, the weighted-average assumed health care cost trend rates for our postretirement health plans were as follows for each fiscal year: 2021 2020 2019 Healthcare cost trend rate for next year: Participants under age 65 6.50% 6.75% 7.00% Participants age 65 or older 6.00% 6.25% 6.50% Rate to which the cost trend rate is assumed to decline: Participants under age 65 4.50% 4.50% 4.50% Participants age 65 or older 4.50% 4.50% 4.50% Year the rate reaches the ultimate trend rate: Participants under age 65 2030 2030 2030 Participants age 65 or older 2028 2028 2028 The assumed healthcare cost trend rate represents our estimate of the annual rates of change in the costs of the healthcare benefits currently provided by our postretirement plans. The healthcare cost trend rate implicitly considers estimates of healthcare inflation, changes in healthcare utilization and delivery patterns, technological advances and changes in the health status of the plan participants. The healthcare cost trend rate assumption has a significant effect on the amounts reported. For example, a 1.0% change in the assumed healthcare cost trend rate would have the following effect on the fiscal 2021 net periodic benefit cost and end of year PBO ( in thousands ): 1% Point 1% Point Total interest and service cost $ 53 $ (46) Postretirement benefit obligation $ 1,604 $ (1,405) Plan assets — Our investment philosophy is to (1) protect the corpus of the fund; (2) establish investment objectives that will allow the market value to exceed the present value of the vested and unvested liabilities over time; while (3) obtaining adequate investment returns to protect benefits promised to the participants and their beneficiaries. Our asset allocation strategy utilizes multiple investment managers in order to maximize the plan’s return while minimizing risk. We regularly monitor our asset allocation, and senior financial management and the Finance Committee of the Board of Directors review performance results quarterly. We continually review our target asset allocation for our Qualified Plan and when changes are made, we reallocate our plan assets over a period of time, as deemed appropriate by senior financial management, to achieve our target asset allocation. Our plan asset allocation at the end of fiscal 2021 and target allocations were as follows: 2021 Target Minimum Maximum Cash & cash equivalents 1% 1% —% —% Domestic equities 16% 16% 8% 24% International equities 15% 16% 8% 24% Core fixed funds 49% 48% 43% 53% High yield 2% 3% —% 6% Alternative investments 7% 6% —% 12% Real estate 5% 5% —% 10% Real return bonds 5% 5% —% 12% 100% 100% The Company measures its defined benefit plan assets and obligations as of the month-end date closest to its fiscal year end, which is a practical expedient under FASB authoritative guidance. The fair values of the Qualified Plan’s assets by asset category are as follows ( in thousands ): Total Quoted Prices Significant Significant Items Measured at Fair Value at September 30, 2021: Asset Category: Cash and cash equivalents (1) $ 1,969 $ — $ 1,969 $ — Equity: U.S. (2) 66,921 66,921 — — International (3),(4) 63,087 31,128 — — Fixed income: Investment grade (5) 219,295 20,701 198,594 — High yield (6) 10,156 10,156 — — Alternatives (4),(7) 26,519 — — — Real estate (4),(8) 21,761 — — — $ 409,708 $ 128,906 $ 200,563 $ — Items Measured at Fair Value at September 30, 2020: Asset Category: Cash and cash equivalents (1) $ 3,665 $ — $ 3,665 $ — Equity: U.S. (2) 83,676 83,676 — — International (3),(4) 81,228 40,319 — — Fixed income: Investment grade (5) 126,630 3,006 123,624 — High yield (6) 9,270 9,270 — — Alternatives (4),(7) 29,375 — — — Real estate (4),(8) 31,666 — — — $ 365,510 $ 136,271 $ 127,289 $ — ________________________ (1) Cash and cash equivalents are comprised of commercial paper, short-term bills and notes, and short-term investment funds, which are valued at quoted prices in active markets for similar securities. (2) U.S. equity securities are comprised of investments in common stock of U.S. companies for total return purposes. These investments are valued by the trustee at closing prices from national exchanges on the valuation date. (3) International equity securities are comprised of investments in common stock of companies located outside of the U.S. for total return purposes. These investments are valued by the trustee at closing prices from national exchanges on the valuation date, or the values are adjusted as a result of market movements following the close of local trading using inputs to models that are observable either directly or indirectly. The portion of these investments that are measured at fair value using the net asset value per share practical expedient (see note 4 below) can be redeemed on a monthly basis. (4) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position. (5) Investment grade fixed income consists of debt obligations either issued by the U.S. government or have a rating of BBB- / Baa or higher assigned by a major credit rating agency. These investments are valued based on unadjusted quoted market prices (Level 1), or based on quoted prices in inactive markets, or whose values are based on models, but the inputs to those models are observable either directly or indirectly (Level 2). (6) High yield fixed income consists primarily of debt obligations that have a rating of below BBB- / Baa or lower assigned by a major credit rating agency. These investments are valued based on unadjusted quoted market prices. (7) Alternative investments consist primarily of an investment in asset classes other than stocks, bonds, and cash. Alternative investments can include commodities, hedge funds, private equity, managed futures, and derivatives. These investments are valued based on unadjusted quoted market prices and can be redeemed on a bi-monthly basis. (8) Real estate is investments in a real estate collective trust for purposes of total return. These investments are valued based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These investments can be redeemed on a quarterly basis. Future cash flows — Our policy is to fund our plans at or above the minimum required by law. As of the date of our last actuarial funding valuation, there was no minimum requirement. We do not anticipate making any contributions to our Qualified Plan in fiscal 2022. Contributions expected to be paid in the next fiscal year, the projected benefit payments for each of the next five fiscal years, and the total aggregate amount for the subsequent five fiscal years are as follows ( in thousands ): Defined Benefit Plans Postretirement Estimated net contributions during fiscal 2022 $ 5,216 $ 1,132 Estimated future year benefit payments during fiscal years: 2022 $ 20,051 $ 1,132 2023 $ 20,092 $ 1,152 2024 $ 20,302 $ 1,168 2025 $ 20,746 $ 1,179 2026 $ 21,295 $ 1,182 2027-2031 $ 114,002 $ 5,708 We will continue to evaluate contributions to our Qualified Plan based on changes in pension assets as a result of asset performance in the current market and economic environment. Expected benefit payments are based on the same assumptions used to measure our benefit obligations at October 3, 2021 and include estimated future employee service, if applicable. |
Share-Based Employee Compensati
Share-Based Employee Compensation | 12 Months Ended |
Oct. 03, 2021 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Share-Based Employee Compensation | SHARE-BASED EMPLOYEE COMPENSATION Stock incentive plans — We offer share-based compensation plans to attract, retain, and motivate key officers, employees, and non-employee directors to work toward the financial success of the Company. Our stock incentive plans are administered by the Compensation Committee of the Board of Directors and have been approved by the stockholders of the Company. The terms and conditions of our share-based awards are determined by the Compensation Committee for each award date and may include provisions for the exercise price, expirations, vesting, restriction on sales, and forfeitures, as applicable. We issue new shares to satisfy stock issuances under our stock incentive plans. Our Amended and Restated 2004 Stock Incentive Plan authorizes the issuance of up to 11,600,000 common shares in connection with the granting of stock options, stock appreciation rights, restricted stock purchase rights, restricted stock bonuses, restricted stock units, or performance units to our employees and directors. There were 1,755,983 shares of common stock available for future issuance under this plan as of October 3, 2021. We also maintain a deferred compensation plan for non-management directors under which those who are eligible to receive fees or retainers may choose to defer receipt of their compensation. The deferred amounts are converted to stock equivalents. The plan requires settlement in shares of our common stock based on the number of stock equivalents and dividend equivalents at the time of a participant’s separation from the Board of Directors. This plan provides for the issuance of up to 350,000 shares of common stock in connection with the crediting of stock equivalents. There were 142,918 shares of common stock available for future issuance under this plan as of October 3, 2021. Compensation expense — The components of share-based compensation expense, included within “Selling, general, and administrative expenses” in our consolidated statement of earnings, in each fiscal year are as follows ( in thousands ): 2021 2020 2019 Nonvested stock units $ 2,969 $ 3,526 $ 5,458 Stock options 25 351 936 Performance share awards 830 254 1,417 Non-management directors’ deferred compensation 224 263 263 Total share-based compensation expense $ 4,048 $ 4,394 $ 8,074 Nonvested restricted stock units — Nonvested restricted stock units (“RSUs”) are generally issued to employees and non-employee directors. Grants to executive officers of time-vesting RSUs vest ratably over four years and are subject to a stock holding requirement of 50% of after-tax net shares resulting from the vesting of RSUs and must be held until termination of service. There were 38,650 of such RSUs outstanding as of October 3, 2021. RSUs issued to non-management directors vest 12 months from the date of grant, or upon termination of board service, including RSUs for which the director elected to defer receipt until termination of board service, and totaled 66,250 units outstanding as of October 3, 2021. RSUs issued to certain other employees either cliff vest or vest ratably over three years and totaled 36,297 units outstanding as of October 3, 2021. These awards are amortized to compensation expense over the estimated vesting period based upon the fair value of our common stock on the award date discounted by the present value of the expected dividend stream over the vesting period. The following is a summary of RSU activity for fiscal 2021: Shares Weighted- RSUs outstanding at September 27, 2020 175,141 $ 59.65 Granted 66,811 $ 95.44 Released (81,968) $ 52.77 Forfeited (18,787) $ 87.70 RSUs outstanding at October 3, 2021 141,197 $ 76.84 As of October 3, 2021, there was approximately $4.4 million of total unrecognized compensation cost related to RSUs, which is expected to be recognized over a weighted-average period of 2.3 years. The weighted-average grant date fair value of awards granted was $95.44, $73.94, and $86.08 in fiscal years 2021, 2020, and 2019, respectively. In fiscal years 2021, 2020, and 2019, the total fair value of RSUs that vested and were released was $4.3 million, $8.7 million, and $4.7 million, respectively. Modification of RSU awards — On April 16, 2020, we entered into a Retention, Transition and Separation Agreement with our former Chairman and Chief Executive Officer, which sets forth the terms of his transition and certain benefits he is eligible to receive, pro-rated through the duration of the transition period, which included vesting of his final tranche of unvested restricted stock units remaining under his November 2015 restricted stock unit award scheduled to vest in November 2020. Consequently, 23,128 shares vested on his last day of employment on July 31, 2020. This was accounted for as an equity award modification under ASC Topic 718, and as the fair value of the modified award was less than previously recognized compensation, no incremental compensation costs were recorded by the Company. Stock options — Option grants have contractual terms of seven years and employee options vest over a three-year period. Options may vest sooner upon retirement from the Company for employees meeting certain age and years of service thresholds. All option grants provide for an option exercise price equal to the closing market value of the common stock on the date of grant. The following is a summary of stock option activity for fiscal 2021: Shares Weighted- Weighted- Aggregate Options outstanding at September 27, 2020 207,463 $ 91.85 Granted — N/A Exercised (75,028) $ 88.60 Forfeited (15,100) $ 76.29 Expired (84,218) $ 97.31 Options outstanding at October 3, 2021 33,117 $ 92.44 3.27 $ 315 Options exercisable at October 3, 2021 27,109 $ 96.26 2.84 $ 169 The aggregate intrinsic value in the table above is the amount by which the current market price of our stock on October 3, 2021 exceeds the weighted-average exercise price. We use a valuation model to determine the fair value of options granted that requires the input of highly subjective assumptions, including the expected volatility of the stock price. The following table presents the weighted-average assumptions used for stock option grants in each fiscal year, along with the related weighted-average grant date fair value: 2021 (1) 2020 2019 (1) Risk-free interest rate N/A 1.7% N/A Expected dividends yield N/A 2.1% N/A Expected stock price volatility N/A 28.1% N/A Expected life of options (in years) N/A 3.47 N/A Weighted-average grant date fair value N/A $13.97 N/A ________________________ (1) No stock option awards were granted in fiscal 2021 or fiscal 2019. The risk-free interest rate was determined by a yield curve of risk-free rates based on published U.S. Treasury spot rates in effect at the time of grant and has a term equal to the expected life of the related options. The dividend yield assumption is based on the Company’s history and expectations of dividend payouts at the grant date. The expected stock price volatility in all years represents the Company’s historical volatility. The expected life of the options represents the period of time the options are expected to be outstanding and is based on historical trends. As of October 3, 2021, there was less than $0.1 million of total unrecognized compensation cost related to stock options grants that is expected to be recognized over a weighted-average period of 1.2 years. The total intrinsic value of stock options exercised was $1.6 million, $0.7 million, and $0.5 million in fiscal years 2021, 2020, and 2019, respectively. Performance share awards — Performance share awards, granted in the form of stock units, represent a right to receive a certain number of shares of common stock based on the achievement of corporate performance goals and continued employment during the vesting period. Performance share awards issued to executives vest at the end of a three-year period and vested amounts may range from 0% to a maximum of 150% of targeted amounts depending on the achievement of performance measures at the end of a three-year period. If the awardee ceases to be employed by the Company prior to the last day of the performance period due to retirement, disability, or death, the performance share awards become vested pro-rata based on the number of full accounting periods the awardee was continuously employed by the Company during the performance period. The expected cost of the shares is based on the fair value of our stock on the date of grant and is reflected over the vesting period with a reduction for estimated forfeitures. These awards may be settled in cash or shares of common stock at the election of the Company on the date of grant. It is our intent to settle these awards with shares of common stock. The following is a summary of performance share award activity for fiscal 2021: Shares Weighted- Performance share awards outstanding at September 27, 2020 25,042 $ 63.59 Granted 28,166 $ 88.88 Issued (8,717) $ 63.61 Forfeited (11,026) $ 82.49 Performance adjustments 1,632 $ 82.80 Performance share awards outstanding at October 3, 2021 35,097 $ 79.92 As of October 3, 2021, there was approximately $1.4 million of total unrecognized compensation cost related to performance share awards, which is expected to be recognized over a weighted-average period of 2.0 years. The weighted-average grant date fair value of awards granted was $88.88, $81.02, and $84.60 in fiscal years 2021, 2020, and 2019, respectively. The total fair value of awards that became fully vested during fiscal years 2021, 2020, and 2019 was $0.6 million, $0.5 million, and $2.1 million, respectively. Non-management directors’ deferred compensation — All awards outstanding under our directors’ deferred compensation plan are accounted for as equity-based awards and deferred amounts are converted into stock equivalents based on a per share price equal to the average of the closing price of our common stock for the 10 trading days immediately preceding the date the deferred compensation is credited to the director’s account. During fiscal 2021 and 2019, no shares of common stock were issued in connection with director retirements. During fiscal 2020, 204 shares of common stock were issued in connection with director retirements with a fair value of less than $0.1 million. The following is a summary of the stock equivalent activity for fiscal 2021: Stock Weighted- Stock equivalents outstanding at September 27, 2020 105,876 $ 40.96 Deferred directors’ compensation 1,334 $ 108.70 Dividend equivalents 2,253 $ 102.80 Stock equivalents outstanding at October 3, 2021 109,463 $ 43.06 |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Oct. 03, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Deficit | STOCKHOLDERS’ DEFICIT Repurchases of common stock — In fiscal 2021, the Company purchased 1.9 million shares of its common stock for an aggregate cost of $200.0 million. As of October 3, 2021, there was no remaining amount under share repurchase programs authorized by the Board of Directors. Dividends — In fiscal 2021, the Board of Directors declared four cash dividends of $0.40, $0.40, $0.44, and $0.44, respectively, totaling $37.6 million. Future dividends are subject to approval by our Board of Directors. |
Average Shares Outstanding
Average Shares Outstanding | 12 Months Ended |
Oct. 03, 2021 | |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | |
Average Shares Outstanding | AVERAGE SHARES OUTSTANDING Our basic earnings per share calculation is computed based on the weighted-average number of common shares outstanding. Our diluted earnings per share calculation is computed based on the weighted-average number of common shares outstanding adjusted by the number of additional shares that would have been outstanding had the potentially dilutive common shares been issued. Potentially dilutive common shares include nonvested stock awards and units, stock options, and non-management director stock equivalents. Performance share awards are included in the average diluted shares outstanding each period if the performance criteria have been met at the end of the respective periods. The following table reconciles basic weighted-average shares outstanding to diluted weighted-average shares outstanding in each fiscal year ( in thousands ): 2021 2020 2019 Weighted-average shares outstanding — basic 22,402 23,125 25,823 Effect of potentially dilutive securities: Nonvested stock awards and units 62 137 211 Stock options 9 — 10 Performance share awards 5 7 24 Weighted-average shares outstanding — diluted 22,478 23,269 26,068 Excluded from diluted weighted-average shares outstanding: Antidilutive 29 318 186 Performance conditions not satisfied at the end of the period 25 14 65 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Oct. 03, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Purchase commitments — We have entered into long-term beverage agreements with The Coca-Cola Company and Dr. Pepper / Seven Up, Inc., which provide fountain products and certain marketing support funding to the Company and its franchisees. These agreements require minimum purchases of fountain beverage syrup, by the Company and its franchisees at agreed upon prices until the total volume commitments have been reached. The volume commitments are not subject to any time limit. As of October 3, 2021, we estimate that it will take approximately four years to complete the Coca-Cola purchase commitment and approximately five years to complete the Dr. Pepper purchase commitment. The Company estimates future annual purchases under these agreements to be approximately $51.3 million as of October 3, 2021 based on the expected ratio of usage at company-operated to franchise restaurants. We also have entered into various arrangements with vendors providing information technology services with no early termination fees. The Company’s unconditional purchase obligations on these contracts total approximately $7.3 million over the next two years. Legal matters — We assess contingencies, including litigation contingencies, to determine the degree of probability and range of possible loss for potential accrual in our financial statements. An estimated loss contingency is accrued in the financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable, assessing contingencies is highly subjective and requires judgments about future events. When evaluating litigation contingencies, we may be unable to provide a meaningful estimate due to a number of factors, including the procedural status of the matter in question, the availability of appellate remedies, insurance coverage related to the claim or claims in question, the presence of complex or novel legal theories, and the ongoing discovery and development of information important to the matter. In addition, damage amounts claimed in litigation against us may be unsupported, exaggerated, or unrelated to possible outcomes, and as such are not meaningful indicators of our potential liability or financial exposure. We regularly review contingencies to determine the adequacy of the accruals and related disclosures. The ultimate amount of loss may differ from these estimates. As of October 3, 2021 and September 27, 2020, the Company had recorded aggregate liabilities of $7.5 million and $3.8 million, respectively, within “Accrued liabilities” on our consolidated balance sheets for all matters including those described below, that were probable and reasonably estimable. We believe that the ultimate determination of liability in connection with legal claims pending against us, if any, in excess of amounts already provided for such matters in the consolidated financial statements, will not have a material adverse effect on our business, our annual results of operations, liquidity or financial position. Gessele v. Jack in the Box Inc. — In August 2010, five former employees instituted litigation in federal court in Oregon alleging claims under the federal Fair Labor Standards Act and Oregon wage and hour laws. The plaintiffs alleged that the Company failed to pay non-exempt employees for certain meal breaks and improperly made payroll deductions for shoe purchases and for workers’ compensation expenses, and later added additional claims relating to timing of final pay and related wage and hour claims involving employees of a franchisee. In 2016, the court dismissed the federal claims and those relating to franchise employees. In June 2017, the court granted class certification with respect to state law claims of improper deductions and late payment of final wages. The parties participated in a voluntary mediation on March 16, 2020, but the matter did not settle. The plaintiffs recently filed a motion for reconsideration of the court’s prior denial of class certification regarding meal and rest break claims, which remains pending before the court. The Company continues to dispute liability and the plaintiffs’ damages calculations and will continue to vigorously defend against the lawsuit. Other legal matters — In addition to the matter described above, we are subject to normal and routine litigation brought by former or current employees, customers, franchisees, vendors, landlords, shareholders, or others. We intend to defend ourselves in any such matters. Some of these matters may be covered, at least in part, by insurance or other third-party indemnity obligation. We record receivables from third party insurers when recovery has been determined to be probable. Lease guarantees — We remain contingently liable for certain leases relating to our former Qdoba business which we sold in fiscal 2018. Under the Qdoba Purchase Agreement, the buyer has indemnified the Company of all claims related to these guarantees. As of October 3, 2021, the maximum potential liability of future undiscounted payments under these leases is approximately $26.7 million. The lease terms extend for a maximum of approximately 16 more years and we would remain a guarantor of the leases in the event the leases are extended for any established renewal periods. In the event of default, we believe the exposure is limited due to contractual protections and recourse available in the lease agreements, as well as the Qdoba Purchase Agreement, including a requirement of the landlord to mitigate damages by re-letting the properties in default, and indemnity from the Buyer. The Company has not recorded a liability for these guarantees as we believe the likelihood of making any future payments is remote. |
Supplemental Consolidated Cash
Supplemental Consolidated Cash Flow Information | 12 Months Ended |
Oct. 03, 2021 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Consolidated Cash Flow Information | SUPPLEMENTAL CONSOLIDATED CASH FLOW INFORMATION ( in thousands ) 2021 2020 2019 Cash paid during the year for: Income tax payments $ 48,200 $ 29,360 $ 14,906 Interest, net of amounts capitalized $ 60,413 $ 68,612 $ 46,227 Non-cash investing and financing transactions: Increase in dividends accrued or converted to common stock equivalents $ 232 $ 117 $ 247 Consideration for franchise acquisitions $ 1,305 $ 859 $ — Increase (decrease) in obligations for purchases of property and equipment $ 1,755 $ (2,696) $ (2,117) Decrease in obligations for treasury stock repurchases $ — $ (2,025) $ (12,337) |
Supplemental Consolidated Finan
Supplemental Consolidated Financial Statement Information | 12 Months Ended |
Oct. 03, 2021 | |
Supplemental Consolidated Financial Statement Information [Abstract] | |
Supplemental Consolidated Financial Statement Information | SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION ( in thousands ) October 3, September 27, Accounts and other receivables, net: Trade $ 75,273 $ 77,082 Notes receivable, current portion 1,467 1,193 Income tax receivable 1,157 1,591 Other 2,730 4,092 Allowance for doubtful accounts (6,292) (5,541) $ 74,335 $ 78,417 Other assets, net: Company-owned life insurance policies $ 123,566 $ 113,767 Deferred rent receivable 46,234 48,604 Franchise tenant improvement allowances 34,124 29,437 Notes receivable, less current portion 4,544 1,851 Other 15,970 16,964 $ 224,438 $ 210,623 Accrued liabilities: Payroll and related taxes $ 34,649 $ 34,475 Sales and property taxes 23,174 22,038 Insurance 21,218 25,310 Deferred rent income 17,892 1,687 Advertising 13,097 9,861 Deferred franchise fees 4,824 4,934 Other 33,563 31,126 $ 148,417 $ 129,431 Other long-term liabilities: Defined benefit pension plans $ 70,354 $ 120,811 Deferred franchise fees 35,608 38,607 Other 50,380 47,076 $ 156,342 $ 206,494 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Oct. 03, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS On November 19, 2021, the Board of Directors declared a cash dividend of $0.44 per share, to be paid on December 23, 2021 to shareholders of record as of the close of business on December 9, 2021. Future dividends will be subject to approval by our Board of Directors. On November 19, 2021, the Board of Directors authorized an additional $200.0 million stock buy-back program that expires on November 20, 2023. |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Policy) | 12 Months Ended |
Oct. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of operations | Nature of operations — Founded in 1951, Jack in the Box Inc. (the “Company”) operates and franchises Jack in the Box ® |
Basis of presentation | Basis of presentation — The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain prior period information on the consolidated statement of cash flows has been reclassified to conform to the current year presentation. |
Fiscal year | Fiscal year — Our fiscal year is 52 or 53 weeks ending the Sunday closest to September 30. Comparisons throughout these notes to the consolidated financial statements refer to the 53-week period ended October 3, 2021 for the fiscal year 2021 and 52-week periods ended September 27, 2020 and September 29, 2019 for fiscal years 2020 and 2019, respectively |
Principles of consolidation | Principles of consolidation — The accompanying consolidated financial statements include the accounts of Jack in the Box Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated upon consolidation. |
Use of estimates | Use of estimates — In preparing the consolidated financial statements in conformity with U.S. GAAP, management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities, revenues, expenses, and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially from these estimates. |
Restricted cash | Restricted cash — In accordance with the terms of our securitized financing facility, certain cash balances are required to be held in trust. Such restricted cash primarily represents cash collections and cash reserves held by the trustee to be used for payments of quarterly interest and commitment fees required for the Class A-1 and Class A-2 Notes. Starting in the second quarter of 2020, with uncertainty surrounding COVID-19 events, we voluntarily elected to fund cash held in trust for one additional quarterly interest and commitment fee payment. This voluntary election was discontinued in the second quarter of 2021. As of October 3, 2021 and September 27, 2020, restricted cash balances were $18.2 million and $37.3 million, respectively. |
Accounts and other receivables, net | Accounts and other receivables, net — Our accounts and other receivables, net is primarily comprised of receivables from franchisees, tenants, credit card processors, and insurance receivables. Franchisee receivables primarily include rents, property taxes, royalties, marketing, sourcing and technology support fees associated with lease and franchise agreements, and notes from certain of our franchisees. Tenant receivables relate to subleased properties where we are on the master lease agreement. We accrue interest on notes receivable based on the contractual terms. The allowance for doubtful accounts is based on historical experience and a review of existing receivables. |
Inventories | Inventories — Our inventories consist principally of food, packaging, and supplies, and are valued at the lower of cost or market on a first-in, first-out basis. |
Assets held for sale | Assets held for sale — Our assets held for sale typically includes property we plan to sell within the next year. If the determination is made that we no longer expect to sell an asset within the next year, the asset is reclassified out of assets held for sale. Long-lived assets that meet the held for sale criteria are reported at the lower of their carrying value or fair value, less estimated costs to sell. |
Property and equipment, at cost | Property and equipment, net — Expenditures for new facilities and equipment, and those that substantially increase the useful lives of the property, are capitalized. Facilities leased under finance leases are stated at the present value of minimum lease payments at the beginning of the lease term, not to exceed fair value. Maintenance and repairs are expensed as incurred. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts, and gains or losses on the dispositions are included in “Impairment and other (gains) charges, net” in the accompanying consolidated statements of earnings. |
Depreciation | Buildings, equipment, and leasehold improvements are generally depreciated using the straight-line method based on the estimated useful lives of the assets, over the initial lease term for certain assets acquired in conjunction with the lease commencement for leased properties, or the remaining lease term for certain assets acquired after the commencement of the lease for leased properties. In certain situations, one or more option periods may be used in determining the depreciable life of assets related to leased properties if we deem that an economic penalty would be incurred otherwise. In either circumstance, our policy requires lease term consistency when calculating the depreciation period, in classifying the lease and in computing straight-line rent expense. Building, leasehold improvement assets and equipment are assigned lives that range from 1 to 35 years. Depreciation expense related to property and equipment was $46.5 million, $52.8 million, and $55.2 million in fiscal year 2021, 2020, and 2019, respectively. |
Impairment of long-lived assets | Impairment of long-lived assets — We evaluate long-lived assets, such as property and equipment and operating lease right-of-use assets, for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable. Long-lived assets are grouped for recognition and measurement of impairment at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets. The impairment test for long-lived assets requires us to assess the recoverability of long-lived assets by comparing their net carrying value to the sum of undiscounted estimated future cash flows directly associated with and arising from our use and eventual disposition of the assets. If the carrying amount of a long-lived asset group exceeds the sum of related undiscounted future cash flows, we recognize an impairment loss by the amount that the carrying value of the assets exceeds fair value. Refer to Note 9, Impairment and Other (Gains) Charges, Net , for additional information. |
Goodwill and intangible assets | Goodwill and intangible assets — Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired, if any. We generally record goodwill in connection with the acquisition of restaurants from franchisees. Likewise, upon the sale of restaurants to franchisees, goodwill is decremented. The amount of goodwill written-off is determined as the fair value of the business disposed of as a percentage of the fair value of the reporting unit retained. If the business disposed of was never fully integrated into the reporting unit after its acquisition, and thus the benefits of the acquired goodwill were never realized, the current carrying amount of the acquired goodwill is written off. Goodwill is evaluated for impairment annually during the fourth quarter, or more frequently if indicators of impairment are present. We first assess qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of a reporting unit or indefinite-lived asset is less than its carrying amount. If the qualitative factors indicate that it is more likely than not that the fair value is less than the carrying amount, we perform a single-step impairment test. To perform our impairment analysis, we estimate the fair value of the reporting unit and compare it to the carrying value. If the carrying value exceeds the fair value, an impairment loss is recognized equal to the excess. Refer to Note 4, Goodwill , for additional information. Reacquired franchise rights are recorded in connection with our acquisition of franchised restaurants and are amortized over the remaining contractual period of the franchise contract in which the right was granted. As of October 3, 2021 and September 27, 2020, the carrying value of our intangible assets was $0.5 million and $0.3 million, respectively, and are included in “Intangible assets, net” in the accompanying consolidated balance sheets. |
Company-owned life insurance | Company-owned life insurance — We have purchased company-owned life insurance (“COLI”) policies to support our non-qualified benefit plans. The cash surrender values of these policies were $123.6 million and $113.8 million as of October 3, 2021 and September 27, 2020, respectively, and are included in “Other assets, net”, in the accompanying consolidated balance sheets. Changes in cash surrender values are included in “Selling, general and administrative expenses” in the accompanying consolidated statements of earnings. These policies reside in an umbrella trust for use only to pay plan benefits to participants or to pay creditors if the Company becomes insolvent. |
Leases | Leases — We evaluate the contracts entered into by the Company to determine whether such contracts contain leases. A contract contains a lease if the contract conveys the right to control the use of identified property, plant, and equipment for a period of time in exchange for consideration. At commencement, contracts containing a lease are further evaluated for classification as an operating or finance lease where the Company is a lessee, or as an operating, sales-type, or direct financing lease where the Company is a lessor, based on their terms. The lease term and incremental borrowing rate for each lease requires judgement by management and can impact the classification of our leases as well as the value of our lease assets and liabilities. When determining the lease term, we consider option periods available, and include option periods in the measurement of the lease right-of-use (“ROU”) asset and lease |
Revenue recognition | Revenue recognition — “Company restaurant sales” include revenue recognized upon delivery of food and beverages to the customer at company-operated restaurants, which is when our obligation to perform is satisfied. Company restaurant sales exclude taxes collected from the Company’s customers. Gift cards, upon customer purchase, are recorded as deferred income and are recognized in revenue as they are redeemed. “Franchise rental revenues” received from franchised restaurants based on fixed rental payments are recognized as revenue over the term of the lease. Rental revenue from properties owned and leased by the Company and leased or subleased to franchisees is recognized on a straight-line basis over the respective term of the lease. Certain franchise rents, which are contingent upon sales levels, are recognized in the period in which the contingency is met. “Franchise royalties and other” primarily includes royalties and franchise fees received from our franchisees. Royalties are based upon a percentage of sales of the franchised restaurant and are recognized as earned. Franchise royalties are billed on a monthly basis. Franchise fees when a new restaurant opens or at the start of a new franchise term are recorded as deferred revenue when received and recognized as revenue over the term of the franchise agreement. “Franchise contributions for advertising and other services” includes franchisee contributions to our marketing fund billed on a monthly basis and sourcing and technology fees, as required under the franchise agreements. Contributions to our marketing fund are based on a percentage of sales and recognized as earned. Sourcing and technology services are recognized when the goods or services are transferred to the franchisee. Gift cards — We sell gift cards to our customers in our restaurants and through selected third parties. The gift cards sold to our customers have no stated expiration dates and are subject to actual or potential escheatment rights in several of the jurisdictions in which we operate. We recognize income from gift cards when redeemed by the customer. While we will continue to honor all gift cards presented for payment, we may determine the likelihood of redemption to be remote for certain card balances due to, among other things, long periods of inactivity. In these circumstances, to the extent we determine there is no requirement for remitting balances to government agencies under unclaimed property laws, card balances may be recognized as income in our statement of earnings. Amounts recognized on unredeemed gift card balances were $0.6 million, $0.5 million, and $0.5 million in fiscal 2021, 2020, and 2019, respectively. Pre-opening costs — Pre-opening costs associated with the opening of a new restaurant or the remodeling of an existing restaurant consist primarily of property rent and employee training costs. Pre-opening costs associated with the opening of a restaurant that was closed upon acquisition consist of labor costs, maintenance and repair costs, and property rent. Pre-opening costs are included in “Selling, general and administrative expenses” in the accompanying consolidated statements of earnings. |
Self-insurance | Self-insurance — We are self-insured for a portion of our workers’ compensation, general liability, employee medical and dental, and automotive claims. We utilize a paid-loss plan for our workers’ compensation, general liability, and automotive programs, which have predetermined loss limits per occurrence and in the aggregate. We establish our insurance liability (undiscounted) and reserves using independent actuarial estimates of expected losses for determining reported claims and as the basis for estimating claims incurred, but not reported. As of October 3, 2021 and September 27, 2020, our estimated liability for general liability and workers’ compensation claims exceeded our self-insurance retention limits by $1.8 million and $1.9 million, respectively, which we expect our insurance providers to pay on our behalf in accordance with the contractual terms of our insurance policies. |
Advertising costs | Advertising costs — We administer a marketing fund that includes contractual contributions. In 2021, 2020 and 2019, marketing fund contributions from franchise and company-operated restaurants were approximately 5.0% of gross revenues with the exception of our March 2020 and April 2020 marketing fees. In response to the economic burden associated with the COVID-19 pandemic, the Company reduced March 2020 marketing fees to 4.0% and postponed the collection of these fees over the course of 24 months. April 2020 marketing fees ranged from 2% to 4% based on annualized sales volumes, and these fees will be collected over three months beginning October 2020. As of October 3, 2021, postponed marketing fees which remain uncollected were $4.3 million which is included within “Accounts and other receivables, net” in our consolidated balance sheet. |
Share-based compensation | Share-based compensation — We account for our share-based compensation under the Financial Accounting Standards Board (“FASB”) authoritative guidance on stock compensation , which generally requires, among other things, that all employee share-based compensation be measured using a fair value method and that the resulting compensation cost be recognized in the financial statements. Compensation expense for our share-based compensation awards is generally recognized on a straight-line basis over the shorter of the vesting period or the period from the date of grant to the date the employee becomes eligible to retire. Refer to Note 13, Share-based Employee Compensation , for additional information. |
Income taxes | Income taxes — Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as tax loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. We recognize interest and, when applicable, penalties related to unrecognized tax benefits as a component of our income tax provision. Authoritative guidance issued by the FASB prescribes a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. The minimum threshold is defined as a tax position that is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Refer to Note 11, Income Taxes , for additional information. |
Derivative instruments | Derivative instruments — We have historically used interest rate swaps to hedge interest rate volatility under our senior credit facility. On July 2, 2019, we terminated all interest rate swap agreements in anticipation of the securitization transaction. Prior to terminating the agreements, a ll derivatives were recognized on the consolidated balance sheets at fair value based upon quoted market prices. Changes in the fair values of derivatives were recorded in earnings or other comprehensive income (“OCI”), based on whether or not the instrument is designated as a hedge transaction. Gains or losses on derivative instruments that qualify for hedge designation were reported in OCI and reclassified to earnings in the period the hedged item affected earnings. When the underlying hedge transaction ceased to exist, the associated amount reported in OCI was reclassified to earnings at that time. Refer to Note 6, Derivative Instruments, |
Contingencies | Contingencies — We recognize liabilities for contingencies when we have an exposure that indicates it is probable that an asset has been impaired or that a liability has been incurred and the amount of impairment or loss can be reasonably estimated. Our ultimate legal and financial liability with respect to such matters cannot be estimated with certainty and requires the use of estimates. When the reasonable estimate is a range, the recorded loss will be the best estimate within the range. We record legal settlement costs when those costs are probable and reasonably estimable. Refer to Note 16, Commitments and Contingencies , for additional information. |
Effect of new accounting pronouncements | Effect of new accounting pronouncements adopted in fiscal 2021 — In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , that requires measurement and recognition of expected versus incurred credit losses for financial assets held, including trade receivables. The Company adopted the new guidance in the first quarter of 2021 using the modified retrospective method. The adoption did not have a material impact to our consolidated financial statements. The Company closely monitors the financial condition of our franchisees and estimates the allowance for credit losses based on the lifetime expected loss on receivables. These estimates are based on historical collection experience with our franchisees as well as other factors, including current market conditions and events. Credit quality is monitored through the timing of payments compared to predefined aging criteria and known facts regarding the financial condition of the franchisee or customer. Account balances are charged off against the allowance after recovery efforts have ceased. The Company’s allowance for receivables have not historically been material. The following table summarizes the activity in our allowance for doubtful accounts ( in thousands ): Balance as of September 27, 2020 $ (5,541) Provision for expected credit losses (770) Write-offs charged against the allowance 19 Balance as of October 3, 2021 $ (6,292) In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which aligns the requirements for capitalizing implementation costs in cloud computing arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted the standard in the first quarter of 2021. The adoption of this standard did not have a material impact to our consolidated financial statements. Effect of new accounting pronouncements to be adopted in future periods — We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our consolidated financial statements. |
Nature of Operations and Summ_3
Nature of Operations and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Number of Restaurants | The following table summarizes the number of restaurants as of the end of each fiscal year: 2021 2020 2019 Company-operated 163 144 137 Franchise 2,055 2,097 2,106 Total system 2,218 2,241 2,243 |
Summary of New Accounting Standard Impact | The following table summarizes the activity in our allowance for doubtful accounts ( in thousands ): Balance as of September 27, 2020 $ (5,541) Provision for expected credit losses (770) Write-offs charged against the allowance 19 Balance as of October 3, 2021 $ (6,292) |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Disaggregation of revenue — The following table disaggregates revenue by primary source for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019 (in thousands) : 2021 2020 2019 Sources of revenue: Company restaurant sales $ 387,766 $ 348,987 $ 336,807 Franchise rental revenues 346,634 320,647 272,815 Franchise royalties 193,908 171,407 163,047 Marketing fees 188,184 158,258 157,969 Technology and sourcing fees 16,361 15,295 12,705 Franchise fees and other services 10,817 6,912 6,764 Total revenue $ 1,143,670 $ 1,021,506 $ 950,107 |
Changes in Contract Assets and Liabilities | A summary of significant changes in our contract liabilities is presented below (in thousands) : 2021 2020 2019 Deferred franchise fees at beginning of period $ 43,541 $ 46,273 $ 50,018 Revenue recognized during the period (6,014) (5,440) (5,173) Additions during the period 2,905 2,708 1,428 Deferred franchise fees at end of period $ 40,432 $ 43,541 $ 46,273 |
Estimated Future Franchise Fees | The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied at the end of the period (in thousands) : 2022 $ 4,842 2023 4,690 2024 4,502 2025 4,274 2026 3,953 Thereafter 18,171 $ 40,432 |
Summary of Refranchisings and_2
Summary of Refranchisings and Franchise Acquisitions (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Summary Of Refranchisings, Franchisee Development And Acquisitions [Abstract] | |
Schedule of Franchise Acquisitions | The following table provides detail of the combined acquisitions in 2021 and 2020 ( dollars in thousands ): 2021 2020 Restaurants acquired from franchisees 20 8 Inventory $ 258 $ 73 Property and equipment 1,136 903 Intangible assets 245 263 Other assets 10 6 Goodwill 613 414 Gains on the acquisition of franchise-operated restaurants (340) — Liabilities assumed (277) (800) Total consideration $ 1,645 $ 859 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill during fiscal 2021 and 2020 were as follows ( in thousands ): Balance at September 29, 2019 $ 46,747 Acquisition of franchise-operated restaurants 414 Balance at September 27, 2020 47,161 Acquisition of franchise-operated restaurants 613 Balance at October 3, 2021 $ 47,774 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents the financial assets and liabilities measured at fair value on a recurring basis ( in thousands ): Total Quoted Significant Significant Fair value measurements as of October 3, 2021: Non-qualified deferred compensation plan (1) $ 18,555 $ 18,555 $ — $ — Total liabilities at fair value $ 18,555 $ 18,555 $ — $ — Fair value measurements as of September 27, 2020: Non-qualified deferred compensation plan (1) $ 25,071 $ 25,071 $ — $ — Total liabilities at fair value $ 25,071 $ 25,071 $ — $ — ________________________ (1) We maintain an unfunded defined contribution plan for key executives and other members of management. The fair value of this obligation is based on the closing market prices of the participants’ elected investments. The obligation is included in “Accrued liabilities” and “Other long-term liabilities” on our consolidated balance sheets. (2) We did not have any transfers in or out of Level 1, 2, or 3. |
Carrying Value and Estimated Fair Value of Notes | The following table presents the carrying value and estimated fair value of our Class A-2 Notes as of October 3, 2021 and September 27, 2020 ( in thousands ): October 3, September 27, Carrying Amount Fair Value Carrying Amount Fair Value Class A-2 Notes $ 1,290,251 $ 1,351,057 $ 1,290,251 $ 1,354,241 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Derivative Instruments and Hedges, Assets [Abstract] | |
Gains or Losses Recognized on Interest Rate Swap Derivative Instrument | The following table summarizes the OCI activity related to our interest rate swap derivative instruments and the amounts reclassified from accumulated OCI ( in thousands ): Location in Income 2019 Loss recognized in OCI N/A $ (23,625) Loss reclassified from accumulated OCI into net earnings Interest expense, net $ 24,328 |
Indebtedness (Tables)
Indebtedness (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | The detail of our long-term debt at the end of each fiscal year is as follows ( in thousands ): 2021 2020 Class A-2-I Notes $ 570,688 $ 570,688 Class A-2-II Notes 272,938 272,938 Class A-2-III Notes 446,625 446,625 Class A-1 Variable Funding Notes — 107,876 Finance lease obligations 2,275 2,934 Total debt 1,292,526 1,401,061 Less current maturities of long-term debt (894) (818) Less unamortized debt issuance costs (18,212) (23,330) Long-term debt $ 1,273,420 $ 1,376,913 |
Scheduled Principal Payments of Long-Term Debt | Maturities of long-term debt — Assuming repayment by the Anticipated Repayment Dates and based on the leverage ratio as of October 3, 2021, principal payments on our long-term debt outstanding at October 3, 2021 for each of the next five fiscal years and thereafter are as follows ( in thousands ): 2022 $ 894 2023 571,610 2024 372 2025 38 2026 272,964 Thereafter 446,648 $ 1,292,526 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Leases [Abstract] | |
Lessee, Supplemental Balance Sheet Information | Leased assets and liabilities consisted of the following as of October 3, 2021 and September 27, 2020 (in thousands) : October 3, September 27, Assets: Operating lease ROU assets $ 934,066 $ 904,548 Finance lease ROU assets (1) 1,698 2,333 Total ROU assets $ 935,764 $ 906,881 Liabilities: Current operating lease liabilities $ 150,636 $ 179,000 Current finance lease liabilities (2) 894 818 Long-term operating lease liabilities 809,191 776,094 Long-term finance lease liabilities (2) 1,381 2,116 Total lease liabilities $ 962,102 $ 958,028 ________________________ (1) Included in “Property and equipment, net” on our consolidated balance sheets. (2) Included in “Current maturities of long-term debt” and “Long-term debt, net of current maturities” on our consolidated balance sheets. |
Lease Costs, Lessee | The following table presents the components of our lease costs in fiscal 2021 and 2020 ( in thousands ): 2021 2020 Lease costs: Finance lease cost: Amortization of ROU assets (1) $ 807 $ 767 Interest on lease liabilities (2) 89 110 Operating lease cost (3) 194,149 190,461 Short-term lease cost (3) 427 175 Variable lease cost (3)(4) 43,498 40,798 $ 238,970 $ 232,311 ____________________________ (1) Included in “Depreciation and amortization” in our consolidated statement of earnings. (2) Included in “Interest expense, net” in our consolidated statement of earnings. (3) Operating lease, short-term and variable lease costs associated with franchisees and company-operated restaurants are included in “Franchise occupancy expenses” and “Occupancy and other,” respectively, in our consolidated statement of earnings. For our closed restaurants, these costs are included in “Impairment and other (gains) charges, net” and all other costs are included in “Selling, general and administrative expenses.” (4) Includes $38.0 million and $37.4 million in 2021 and 2020, respectively, of property taxes and common area maintenance costs which are reimbursed by sub-lessees. The following table presents supplemental information related to leases: October 3, September 27, Weighted-average remaining lease term (in years): Finance leases 2.4 3.3 Operating leases 9.0 8.3 Weighted-average discount rate: Finance leases 3.6 % 3.5 % Operating leases 4.1 % 4.2 % The following table includes supplemental cash flow and non-cash information related to our lessee leases ( in thousands ): 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 218,570 $ 190,303 Operating cash flows from financing leases $ 89 $ 110 Financing cash flows from financing leases $ 829 $ 785 Supplemental noncash information on lease liabilities arising from obtaining right-of-use assets: Right-of-use assets obtained in exchange for new operating lease obligations $ 186,621 $ 181,532 Right-of-use assets obtained in exchange for new financing lease obligations $ 184 $ 132 |
Components of Rent Expense | The following table summarizes the components of rent expense in fiscal 2019, as accounted for under previous guidance ( in thousands ): 2019 Minimum rentals 184,587 Contingent rentals 2,255 Total rent expense 186,842 |
Operating Lease, Future Minimum Lease Payments | The following table presents as of October 3, 2021, the annual maturities of our lease liabilities ( in thousands ): Finance Leases Operating Leases Fiscal year: 2022 $ 961 $ 186,717 2023 944 161,788 2024 413 128,816 2025 50 122,114 2026 25 106,582 Thereafter 27 460,138 Total future lease payments (1) $ 2,420 $ 1,166,155 Less: imputed interest (145) (206,328) Present value of lease liabilities $ 2,275 $ 959,827 Less current portion (894) (150,636) Long-term lease obligations $ 1,381 $ 809,191 ________________________ (1) Total future lease payments include non-cancellable commitments of $2.4 million for finance leases and $1,000.0 million for operating leases. |
Finance Lease, Future Minimum Lease Payments | The following table presents as of October 3, 2021, the annual maturities of our lease liabilities ( in thousands ): Finance Leases Operating Leases Fiscal year: 2022 $ 961 $ 186,717 2023 944 161,788 2024 413 128,816 2025 50 122,114 2026 25 106,582 Thereafter 27 460,138 Total future lease payments (1) $ 2,420 $ 1,166,155 Less: imputed interest (145) (206,328) Present value of lease liabilities $ 2,275 $ 959,827 Less current portion (894) (150,636) Long-term lease obligations $ 1,381 $ 809,191 ________________________ (1) Total future lease payments include non-cancellable commitments of $2.4 million for finance leases and $1,000.0 million for operating leases. |
Assets Recorded Under Finance Leases | Assets recorded under finance leases are included in property and equipment, and consisted of the following at each fiscal year-end ( in thousands ): 2021 2020 Buildings 1,342 1,342 Equipment 5,869 5,631 Less accumulated amortization (5,513) (4,640) 1,698 2,333 |
Rental Income | The following table presents rental income ( in thousands ): 2021 2020 Owned Properties Leased Properties Total Owned Properties Leased Properties Total Operating lease income - franchise $ 20,132 $ 218,028 $ 238,160 $ 19,785 $ 216,015 $ 235,800 Variable lease income - franchise 12,363 96,111 108,474 9,960 74,887 84,847 Franchise rental revenues $ 32,495 $ 314,139 $ 346,634 $ 29,745 $ 290,902 $ 320,647 Operating lease income - closed restaurants and other (1) $ — $ 6,027 $ 6,027 $ — $ 6,370 $ 6,370 ________________________ (1) Primarily relates to closed restaurant properties included in “Impairment and other (gains) charges, net” in our consolidated statement of earnings. |
Future Minimum Rental Receipts | The following table presents as of October 3, 2021, future minimum rental receipts for non-cancellable leases and subleases ( in thousands ): October 3, Fiscal year: 2022 $ 238,021 2023 231,342 2024 205,740 2025 214,526 2026 199,906 Thereafter 939,239 Total minimum rental receipts $ 2,028,774 |
Assets Held for Lease | Assets held for lease and included in property and equipment consisted of the following at each fiscal year-end ( in thousands ): October 3, September 27, Land $ 89,791 $ 88,187 Buildings 782,450 801,730 Equipment 223 589 872,464 890,506 Less accumulated depreciation (657,030) (650,812) $ 215,434 $ 239,694 |
Impairment and Other (Gains) _2
Impairment and Other (Gains) Charges, Net (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Restructuring and Related Activities [Abstract] | |
Impairment and Disposal Costs Included in Impairment and Other Charges | Impairment and other (gains) charges, net, in the accompanying consolidated statements of earnings is comprised of the following in each fiscal year ( in thousands ): 2021 2020 2019 Gains on disposition of property and equipment, net (1) (6,888) (9,768) (6,244) Costs of closed restaurants and other (2) 1,907 1,872 8,628 Accelerated depreciation (3) 1,592 235 1,616 Restructuring costs (4) 7 1,168 8,455 $ (3,382) $ (6,493) $ 12,455 ________________________ (1) In 2021, 2020 and 2019 gains on disposition of property and equipment primarily related to the sales of restaurant properties, in addition to the sale of one of our corporate office buildings in 2020. (2) In 2021, 2020 and 2019 costs of closed restaurants primarily include lease termination and impairment charges on future lease commitments and expected ancillary cost, net of anticipated sublease rentals, as a result of our decision to close restaurants, ongoing costs associated with closed restaurants, and canceled project costs. (3) In 2021, 2020, and 2019 accelerated depreciation primarily related to facility improvements, restaurant remodels, and information technology assets. (4) In 2020 and 2019 restructuring costs include charges resulting from a plan that management initiated to reduce our general and administrative costs, which was completed in the third quarter of 2020. In fiscal 2019, charges also include costs resulting from the exploration of strategic alternatives, which was concluded in the third quarter of 2019. |
Discontinued Operations Discont
Discontinued Operations Discontinued Operations (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Qdoba Results from Each Period | The following table presents results of operations in periods which have been included in discontinued operations (in thousands): 2020 2019 Total revenues $ — $ — Total cost and (income) expense (1) (514) 173 Earnings (losses) before income taxes 514 (173) Income tax expense (benefit) (2) 144 (2,863) Earnings from discontinued operations, net of income taxes $ 370 $ 2,690 ________________________ (1) Amounts in 2020 and 2019 include resolutions of certain contingencies that existed at the date of sale which were insignificant in nature. (2) In fiscal 2019, the Company entered into a bilateral California election with Quidditch Acquisition, Inc. to retroactively treat the divestment of Qdoba Restaurant Corporation on March 21, 2018 as a sale of assets instead of a stock sale for income tax purposes. This election reduced the Company’s fiscal year 2018 California tax liability on the divestment by $2.8 million. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Income Tax Disclosure [Abstract] | |
Components of Income Taxes | Income taxes consist of the following in each fiscal year ( in thousands ): 2021 2020 2019 Current: Federal $ 36,051 $ 19,721 $ 14,683 State 11,793 7,844 5,242 47,844 27,565 19,925 Deferred: Federal 4,440 4,625 3,750 State 3,568 537 350 8,008 5,162 4,100 Income tax expense from continuing operations $ 55,852 $ 32,727 $ 24,025 Income tax expense (benefit) from discontinued operations $ — $ 144 $ (2,863) |
Reconciliation of the Federal Statutory Income Tax Rate to Effective Tax Rate | A reconciliation of the federal statutory income tax rate to our effective tax rate for continuing operations is as follows: 2021 2020 2019 Income tax expense at federal statutory rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal tax benefit 5.1 % 5.3 % 5.3 % Stock compensation excess tax benefit (0.5) % (0.4) % (0.1) % Benefit of jobs tax credits, net of valuation allowance (0.1) % (0.5) % (0.3) % Release of federal tax liability — % — % (0.6) % Adjustment to state tax provision 0.7 % — % (0.9) % Benefit related to COLIs (1.5) % (0.9) % (1.0) % Termination of interest rate swaps — % — % (2.6) % Officers’ compensation limitation 0.5 % 2.2 % 1.1 % Other, net — % 0.1 % (1.1) % 25.2 % 26.8 % 20.8 % |
Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities at each fiscal year-end are presented below ( in thousands ): 2021 2020 Deferred tax assets: Operating and finance lease liabilities $ 237,509 $ 234,926 Accrued defined benefit pension and postretirement benefits 28,837 44,436 Deferred income 12,083 12,921 Impairment 6,957 8,895 Accrued insurance 5,389 6,500 Other reserves and allowances 4,050 2,440 Share-based compensation 4,039 4,143 Accrued incentive compensation 3,455 2,585 Tax loss and tax credit carryforwards 3,129 4,273 Accrued compensation expense 710 672 Other, net 3,424 2,364 Total gross deferred tax assets 309,582 324,155 Valuation allowance (1,349) (2,104) Total net deferred tax assets 308,233 322,051 Deferred tax liabilities: Operating and finance lease ROU assets (242,038) (235,373) Intangible assets (11,349) (11,437) Property and equipment, principally due to differences in depreciation (1,036) (1,781) Other (2,293) (1,138) Total gross deferred tax liabilities (256,716) (249,729) Net deferred tax assets $ 51,517 $ 72,322 |
Retirement Plans (Tables)
Retirement Plans (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Retirement Benefits [Abstract] | |
Reconciliation of Changes in Benefit Obligations, Plan Assets and Funded Status of Retirement Plans | The following table provides a reconciliation of the changes in benefit obligations, plan assets, and funded status of our retirement plans for each fiscal year ( in thousands ): Qualified Plan SERP Postretirement Health Plans 2021 2020 2021 2020 2021 2020 Change in benefit obligation: Obligation at beginning of year $ 412,573 $ 521,931 $ 78,971 $ 79,893 $ 20,965 $ 25,632 Interest cost 12,558 13,377 2,169 2,499 563 807 Participant contributions — — — — 112 106 Actuarial (gain) loss (785) 14,498 (672) 1,739 (3,525) (4,391) Benefits paid (14,293) (12,980) (5,243) (5,160) (1,044) (1,246) Settlements — (124,253) — — — — Other — — — — 91 57 Obligation at end of year $ 410,053 $ 412,573 $ 75,225 $ 78,971 $ 17,162 $ 20,965 Change in plan assets: Fair value at beginning of year $ 365,510 $ 476,194 $ — $ — $ — $ — Actual return on plan assets 58,491 26,549 — — — — Participant contributions — — — — 112 106 Employer contributions — — 5,243 5,160 841 1,083 Benefits paid (14,293) (12,980) (5,243) (5,160) (1,044) (1,246) Settlements — (124,253) — — — — Other — — — — 91 57 Fair value at end of year $ 409,708 $ 365,510 $ — $ — $ — $ — Unfunded status at end of year $ (345) $ (47,063) $ (75,225) $ (78,971) $ (17,162) $ (20,965) Amounts recognized on the balance sheet: Current liabilities $ — $ — $ (5,216) $ (5,223) $ (1,115) $ (1,243) Noncurrent liabilities (345) (47,063) (70,009) (73,748) (16,047) (19,722) Total liability recognized $ (345) $ (47,063) $ (75,225) $ (78,971) $ (17,162) $ (20,965) Amounts in AOCI not yet reflected in net periodic benefit cost: Unamortized actuarial loss (gain), net $ 108,922 $ 152,370 $ 32,475 $ 34,890 $ (7,359) $ (4,174) Unamortized prior service cost — — 53 72 — — Total $ 108,922 $ 152,370 $ 32,528 $ 34,962 $ (7,359) $ (4,174) Other changes in plan assets and benefit obligations recognized in OCI: Net actuarial (gain) loss $ (39,936) $ 7,527 $ (672) $ 1,739 $ (3,526) $ (4,391) Pension settlement costs — (39,218) — — — — Amortization of actuarial (loss) gain (3,510) (3,644) (1,743) (1,652) 341 (18) Amortization of prior service cost — — (19) (85) — — Total recognized in OCI (43,446) (35,335) (2,434) 2 (3,185) (4,409) Net periodic benefit (credit) cost and other losses (3,272) 36,661 3,931 4,236 222 825 Total recognized in comprehensive income $ (46,718) $ 1,326 $ 1,497 $ 4,238 $ (2,963) $ (3,584) Amounts in AOCI expected to be amortized in fiscal 2022 net periodic benefit cost: Net actuarial loss (gain) $ 2,193 $ 1,666 $ (640) Prior service cost — 19 — Total $ 2,193 $ 1,685 $ (640) in thousands ): Total Quoted Prices Significant Significant Items Measured at Fair Value at September 30, 2021: Asset Category: Cash and cash equivalents (1) $ 1,969 $ — $ 1,969 $ — Equity: U.S. (2) 66,921 66,921 — — International (3),(4) 63,087 31,128 — — Fixed income: Investment grade (5) 219,295 20,701 198,594 — High yield (6) 10,156 10,156 — — Alternatives (4),(7) 26,519 — — — Real estate (4),(8) 21,761 — — — $ 409,708 $ 128,906 $ 200,563 $ — Items Measured at Fair Value at September 30, 2020: Asset Category: Cash and cash equivalents (1) $ 3,665 $ — $ 3,665 $ — Equity: U.S. (2) 83,676 83,676 — — International (3),(4) 81,228 40,319 — — Fixed income: Investment grade (5) 126,630 3,006 123,624 — High yield (6) 9,270 9,270 — — Alternatives (4),(7) 29,375 — — — Real estate (4),(8) 31,666 — — — $ 365,510 $ 136,271 $ 127,289 $ — ________________________ (1) Cash and cash equivalents are comprised of commercial paper, short-term bills and notes, and short-term investment funds, which are valued at quoted prices in active markets for similar securities. (2) U.S. equity securities are comprised of investments in common stock of U.S. companies for total return purposes. These investments are valued by the trustee at closing prices from national exchanges on the valuation date. (3) International equity securities are comprised of investments in common stock of companies located outside of the U.S. for total return purposes. These investments are valued by the trustee at closing prices from national exchanges on the valuation date, or the values are adjusted as a result of market movements following the close of local trading using inputs to models that are observable either directly or indirectly. The portion of these investments that are measured at fair value using the net asset value per share practical expedient (see note 4 below) can be redeemed on a monthly basis. (4) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position. (5) Investment grade fixed income consists of debt obligations either issued by the U.S. government or have a rating of BBB- / Baa or higher assigned by a major credit rating agency. These investments are valued based on unadjusted quoted market prices (Level 1), or based on quoted prices in inactive markets, or whose values are based on models, but the inputs to those models are observable either directly or indirectly (Level 2). (6) High yield fixed income consists primarily of debt obligations that have a rating of below BBB- / Baa or lower assigned by a major credit rating agency. These investments are valued based on unadjusted quoted market prices. (7) Alternative investments consist primarily of an investment in asset classes other than stocks, bonds, and cash. Alternative investments can include commodities, hedge funds, private equity, managed futures, and derivatives. These investments are valued based on unadjusted quoted market prices and can be redeemed on a bi-monthly basis. (8) Real estate is investments in a real estate collective trust for purposes of total return. These investments are valued based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These investments can be redeemed on a quarterly basis. |
Fair Value of Plan Assets of Pension Plans | The following sets forth the PBO, ABO, and fair value of plan assets of our pension plans as of the measurement date in each fiscal year ( in thousands ): 2021 2020 Qualified Plan: Projected benefit obligation $ 410,053 $ 412,573 Accumulated benefit obligation $ 410,053 $ 412,573 Fair value of plan assets $ 409,708 $ 365,510 SERP: Projected benefit obligation $ 75,225 $ 78,971 Accumulated benefit obligation $ 75,225 $ 78,971 Fair value of plan assets $ — $ — |
Components of Net Periodic Benefit Cost | The components of the fiscal year net periodic benefit cost were as follows ( in thousands ): 2021 2020 2019 Qualified Plan: Interest cost $ 12,558 $ 13,377 $ 19,825 Expected return on plan assets (19,340) (19,578) (26,334) Pension settlements — 39,218 — Actuarial loss 3,510 3,644 2,754 Net periodic benefit (credit) cost $ (3,272) $ 36,661 $ (3,755) SERP: Interest cost $ 2,169 $ 2,499 $ 3,080 Actuarial loss 1,743 1,652 1,207 Amortization of unrecognized prior service cost 19 85 115 Net periodic benefit cost $ 3,931 $ 4,236 $ 4,402 Postretirement health plans: Interest cost $ 563 $ 807 $ 997 Actuarial (gain) loss (341) 18 (159) Net periodic benefit cost $ 222 $ 825 $ 838 |
Determining the Present Values of Benefit Obligations and net Periodic Benefit Costs | In determining the present values of our benefit obligations and net periodic benefit costs as of and for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019, we used the following weighted-average assumptions: 2021 2020 2019 Assumptions used to determine benefit obligations (1): Qualified Plan: Discount rate 3.11% 3.10% 3.36% SERP: Discount rate 2.99% 2.84% 3.24% Rate of future pay increases (2) N/A N/A 3.50% Postretirement health plans: Discount rate 2.95% 2.77% 3.24% Assumptions used to determine net periodic benefit cost (3): Qualified Plan: Discount rate (4) 3.10% 3.36% 4.40% Long-term rate of return on assets (5) 5.40% 5.80% 5.85% SERP: Discount rate 2.84% 3.24% 4.37% Rate of future pay increases (2) N/A 3.50% 3.50% Postretirement health plans: Discount rate 2.77% 3.24% 4.38% ________________________ (1) Determined as of end of year. (2) Rate is not applicable as there are no active employees as of fiscal year end 2020 and 2021. (3) Determined as of beginning of year. (4) Remeasurements were performed in the first, second, and third quarters of fiscal 2020 using 3.61%, 3.38%, and 3.13% respectively. (5) Remeasurements were performed in the first, second, and third quarters of fiscal 2020 using 5.9%, 5.2%, and 5.4% respectively. |
Health Care Cost Trend Rates for Postretirement Health Plans | For measurement purposes, the weighted-average assumed health care cost trend rates for our postretirement health plans were as follows for each fiscal year: 2021 2020 2019 Healthcare cost trend rate for next year: Participants under age 65 6.50% 6.75% 7.00% Participants age 65 or older 6.00% 6.25% 6.50% Rate to which the cost trend rate is assumed to decline: Participants under age 65 4.50% 4.50% 4.50% Participants age 65 or older 4.50% 4.50% 4.50% Year the rate reaches the ultimate trend rate: Participants under age 65 2030 2030 2030 Participants age 65 or older 2028 2028 2028 |
Effect of Change in Assumed Health Care Cost Trend Rate | For example, a 1.0% change in the assumed healthcare cost trend rate would have the following effect on the fiscal 2021 net periodic benefit cost and end of year PBO ( in thousands ): 1% Point 1% Point Total interest and service cost $ 53 $ (46) Postretirement benefit obligation $ 1,604 $ (1,405) |
Fair Values of Qualified Plan's Assets | Our plan asset allocation at the end of fiscal 2021 and target allocations were as follows: 2021 Target Minimum Maximum Cash & cash equivalents 1% 1% —% —% Domestic equities 16% 16% 8% 24% International equities 15% 16% 8% 24% Core fixed funds 49% 48% 43% 53% High yield 2% 3% —% 6% Alternative investments 7% 6% —% 12% Real estate 5% 5% —% 10% Real return bonds 5% 5% —% 12% 100% 100% |
Contributions Expected to be Paid in Next Fiscal Year and Projected Benefit Payments | Contributions expected to be paid in the next fiscal year, the projected benefit payments for each of the next five fiscal years, and the total aggregate amount for the subsequent five fiscal years are as follows ( in thousands ): Defined Benefit Plans Postretirement Estimated net contributions during fiscal 2022 $ 5,216 $ 1,132 Estimated future year benefit payments during fiscal years: 2022 $ 20,051 $ 1,132 2023 $ 20,092 $ 1,152 2024 $ 20,302 $ 1,168 2025 $ 20,746 $ 1,179 2026 $ 21,295 $ 1,182 2027-2031 $ 114,002 $ 5,708 |
Share-Based Employee Compensa_2
Share-Based Employee Compensation (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Components of Share-Based Compensation Expense | The components of share-based compensation expense, included within “Selling, general, and administrative expenses” in our consolidated statement of earnings, in each fiscal year are as follows ( in thousands ): 2021 2020 2019 Nonvested stock units $ 2,969 $ 3,526 $ 5,458 Stock options 25 351 936 Performance share awards 830 254 1,417 Non-management directors’ deferred compensation 224 263 263 Total share-based compensation expense $ 4,048 $ 4,394 $ 8,074 |
Summary of RSU Activity | The following is a summary of RSU activity for fiscal 2021: Shares Weighted- RSUs outstanding at September 27, 2020 175,141 $ 59.65 Granted 66,811 $ 95.44 Released (81,968) $ 52.77 Forfeited (18,787) $ 87.70 RSUs outstanding at October 3, 2021 141,197 $ 76.84 |
Summary of Stock Option Activity | The following is a summary of stock option activity for fiscal 2021: Shares Weighted- Weighted- Aggregate Options outstanding at September 27, 2020 207,463 $ 91.85 Granted — N/A Exercised (75,028) $ 88.60 Forfeited (15,100) $ 76.29 Expired (84,218) $ 97.31 Options outstanding at October 3, 2021 33,117 $ 92.44 3.27 $ 315 Options exercisable at October 3, 2021 27,109 $ 96.26 2.84 $ 169 |
Schedule of Weighted-Average Assumptions | The following table presents the weighted-average assumptions used for stock option grants in each fiscal year, along with the related weighted-average grant date fair value: 2021 (1) 2020 2019 (1) Risk-free interest rate N/A 1.7% N/A Expected dividends yield N/A 2.1% N/A Expected stock price volatility N/A 28.1% N/A Expected life of options (in years) N/A 3.47 N/A Weighted-average grant date fair value N/A $13.97 N/A ________________________ (1) No stock option awards were granted in fiscal 2021 or fiscal 2019. |
Summary of PSU Activity | The following is a summary of performance share award activity for fiscal 2021: Shares Weighted- Performance share awards outstanding at September 27, 2020 25,042 $ 63.59 Granted 28,166 $ 88.88 Issued (8,717) $ 63.61 Forfeited (11,026) $ 82.49 Performance adjustments 1,632 $ 82.80 Performance share awards outstanding at October 3, 2021 35,097 $ 79.92 |
Summary of Stock Equivalent Activity | The following is a summary of the stock equivalent activity for fiscal 2021: Stock Weighted- Stock equivalents outstanding at September 27, 2020 105,876 $ 40.96 Deferred directors’ compensation 1,334 $ 108.70 Dividend equivalents 2,253 $ 102.80 Stock equivalents outstanding at October 3, 2021 109,463 $ 43.06 |
Average Shares Outstanding (Tab
Average Shares Outstanding (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | |
Reconciliation of Basic Weighted-Average Shares Outstanding to Diluted Weighted-Average Shares Outstanding | The following table reconciles basic weighted-average shares outstanding to diluted weighted-average shares outstanding in each fiscal year ( in thousands ): 2021 2020 2019 Weighted-average shares outstanding — basic 22,402 23,125 25,823 Effect of potentially dilutive securities: Nonvested stock awards and units 62 137 211 Stock options 9 — 10 Performance share awards 5 7 24 Weighted-average shares outstanding — diluted 22,478 23,269 26,068 Excluded from diluted weighted-average shares outstanding: Antidilutive 29 318 186 Performance conditions not satisfied at the end of the period 25 14 65 |
Supplemental Consolidated Cas_2
Supplemental Consolidated Cash Flow Information (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Supplemental Cash Flow Information [Abstract] | |
Additional Information Related to Cash Flows | 2021 2020 2019 Cash paid during the year for: Income tax payments $ 48,200 $ 29,360 $ 14,906 Interest, net of amounts capitalized $ 60,413 $ 68,612 $ 46,227 Non-cash investing and financing transactions: Increase in dividends accrued or converted to common stock equivalents $ 232 $ 117 $ 247 Consideration for franchise acquisitions $ 1,305 $ 859 $ — Increase (decrease) in obligations for purchases of property and equipment $ 1,755 $ (2,696) $ (2,117) Decrease in obligations for treasury stock repurchases $ — $ (2,025) $ (12,337) |
Supplemental Consolidated Fin_2
Supplemental Consolidated Financial Statement Information (Tables) | 12 Months Ended |
Oct. 03, 2021 | |
Supplemental Consolidated Financial Statement Information [Abstract] | |
Schedule of Supplemental Consolidated Balance Sheet Information | October 3, September 27, Accounts and other receivables, net: Trade $ 75,273 $ 77,082 Notes receivable, current portion 1,467 1,193 Income tax receivable 1,157 1,591 Other 2,730 4,092 Allowance for doubtful accounts (6,292) (5,541) $ 74,335 $ 78,417 Other assets, net: Company-owned life insurance policies $ 123,566 $ 113,767 Deferred rent receivable 46,234 48,604 Franchise tenant improvement allowances 34,124 29,437 Notes receivable, less current portion 4,544 1,851 Other 15,970 16,964 $ 224,438 $ 210,623 Accrued liabilities: Payroll and related taxes $ 34,649 $ 34,475 Sales and property taxes 23,174 22,038 Insurance 21,218 25,310 Deferred rent income 17,892 1,687 Advertising 13,097 9,861 Deferred franchise fees 4,824 4,934 Other 33,563 31,126 $ 148,417 $ 129,431 Other long-term liabilities: Defined benefit pension plans $ 70,354 $ 120,811 Deferred franchise fees 35,608 38,607 Other 50,380 47,076 $ 156,342 $ 206,494 |
Nature of Operations and Summ_4
Nature of Operations and Summary of Significant Accounting Policies (Summary of Number of Restaurants) (Details) - restaurant | Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 |
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 2,218 | 2,241 | 2,243 |
Company-operated | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 163 | 144 | 137 |
Franchise | |||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||
Number of restaurants | 2,055 | 2,097 | 2,106 |
Nature of Operations and Summ_5
Nature of Operations and Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Apr. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||
Number of weeks per fiscal year | 53 | 52 | 52 | |||
Restricted cash | $ 18,222 | $ 37,258 | ||||
Depreciation | 46,500 | 52,800 | $ 55,200 | |||
Intangible assets, carrying value | 470 | 277 | ||||
Amounts recognized on unredeemed gift card balances | 600 | 500 | 500 | |||
General liability and workers' comp estimated claims to be paid by insurance providers | $ 1,800 | 1,900 | ||||
Contractual contributions | 4.00% | 5.00% | ||||
Collection period for marketing fees | 24 months | 3 months | ||||
Uncollected postponed marketing fees | $ 4,300 | |||||
Accrued advertising costs | 9,500 | 8,300 | ||||
Incremental corporate advertising contributions | 0 | 2,000 | ||||
Marketing and advertising expense | 19,600 | 17,100 | $ 19,000 | |||
Other Assets | ||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||
Cash surrender value of life insurance | $ 123,600 | $ 113,800 | ||||
Minimum | ||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||
Property, plant and equipment assigned lives | 1 year | |||||
Contractual contributions | 2.00% | |||||
Maximum | ||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||
Property, plant and equipment assigned lives | 35 years | |||||
Contractual contributions | 4.00% |
Nature of Operations and Summ_6
Nature of Operations and Summary of Significant Accounting Policies (Effect of New Accounting Pronouncements) (Details) $ in Thousands | 12 Months Ended |
Oct. 03, 2021USD ($) | |
Allowance for Credit Loss [Roll Forward] | |
Balance as of September 27, 2020 | $ (5,541) |
Provision for expected credit losses | (770) |
Write-offs charged against the allowance | 19 |
Balance as of October 3, 2021 | $ (6,292) |
Revenue (Narrative) (Details)
Revenue (Narrative) (Details) | 12 Months Ended |
Oct. 03, 2021USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Initial franchise fee | $ 50,000 |
Royalty and marketing fee, percent of gross sales | 5.00% |
Revenue (Disaggregation of Reve
Revenue (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 1,143,670 | $ 1,021,506 | $ 950,107 |
Company restaurant sales | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 387,766 | 348,987 | 336,807 |
Franchise rental revenues | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 346,634 | 320,647 | 272,815 |
Franchise royalties | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 193,908 | 171,407 | 163,047 |
Marketing fees | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 188,184 | 158,258 | 157,969 |
Technology and sourcing fees | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 16,361 | 15,295 | 12,705 |
Franchise fees and other services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 10,817 | $ 6,912 | $ 6,764 |
Revenue (Contract Liabilities)
Revenue (Contract Liabilities) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Movement in Deferred Revenue [Roll Forward] | |||
Deferred franchise fees at beginning of period | $ 43,541 | $ 46,273 | $ 50,018 |
Revenue recognized during the period | (6,014) | (5,440) | (5,173) |
Additions during the period | 2,905 | 2,708 | 1,428 |
Deferred franchise fees at end of period | $ 40,432 | $ 43,541 | $ 46,273 |
Revenue (Estimated Future Franc
Revenue (Estimated Future Franchise Fees) (Details) $ in Thousands | Oct. 03, 2021USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 40,432 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-04 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | 4,842 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-03 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | 4,690 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-02 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | 4,502 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-09-30 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | 4,274 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-09-28 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | 3,953 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-09-27 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 18,171 |
Revenue (Estimated Future Fra_2
Revenue (Estimated Future Franchese Fees, Period) (Details) | Oct. 03, 2021 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-04 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-03 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-02 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-09-30 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-09-28 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-09-27 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period |
Summary of Refranchisings and_3
Summary of Refranchisings and Franchise Acquisitions (Number of Restaurants Sold to Franchisees and Developed by Franchisees and Gains Recognized) (Details) - restaurant | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Summary Of Refranchisings, Franchisee Development And Acquisitions [Line Items] | |||
Company-owned restaurants sold to franchisees | 0 | 0 | 0 |
Number of restaurants acquired from franchisees | 20 | 8 | 0 |
Number of franchises acquired through agreement with underperforming franchisee | 16 | ||
Number of franchises acquired through exercise of first right of refusal | 4 |
Summary of Refranchisings and_4
Summary of Refranchisings and Franchise Acquisitions (Purchase Price Allocations on Franchise Acquisitions) (Details) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021USD ($)restaurant | Sep. 27, 2020USD ($)restaurant | Sep. 29, 2019restaurant | |
Summary Of Refranchisings, Franchisee Development And Acquisitions [Line Items] | |||
Number of restaurants acquired from franchisees | restaurant | 20 | 8 | 0 |
Goodwill | $ 47,774 | $ 47,161 | |
Gains on the acquisition of franchise-operated restaurants | (340) | 0 | |
Franchise Acquisitions | |||
Summary Of Refranchisings, Franchisee Development And Acquisitions [Line Items] | |||
Inventory | 258 | 73 | |
Property and equipment | 1,136 | 903 | |
Intangible assets | 245 | 263 | |
Other assets | 10 | 6 | |
Goodwill | 613 | 414 | |
Liabilities assumed | (277) | (800) | |
Total consideration | 1,645 | $ 859 | |
Non-cash consideration | 1,300 | ||
Receivables eliminated in acquisition accounting | 300 | ||
Accounts payable recorded in acquisition accounting | $ 1,000 |
Goodwill (Changes in Carrying A
Goodwill (Changes in Carrying Amount of Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 47,161 | |
Goodwill, ending balance | 47,774 | $ 47,161 |
Jack in the box brand restaurant operations | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 47,161 | 46,747 |
Acquisition of franchise-operated restaurants | 613 | 414 |
Goodwill, ending balance | $ 47,774 | $ 47,161 |
Fair Value Measurements (Financ
Fair Value Measurements (Financial Assets and Liabilities Measured at Fair Value on Recurring Basis) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | $ 18,555 | $ 25,071 | |
Quoted Prices in Active Markets for Identical (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [1] | 18,555 | 25,071 |
Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [1] | 0 | 0 |
Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [1] | 0 | 0 |
Non-qualified Deferred Compensation Plan | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | 18,555 | 25,071 | |
Non-qualified Deferred Compensation Plan | Quoted Prices in Active Markets for Identical (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | 18,555 | 25,071 | |
Non-qualified Deferred Compensation Plan | Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | 0 | 0 | |
Non-qualified Deferred Compensation Plan | Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | $ 0 | $ 0 | |
[1] | We did not have any transfers in or out of Level 1, 2, or 3 |
Fair Value Measurements (Carryi
Fair Value Measurements (Carrying Value and Estimated Fair Value of Notes) (Details) - Class A-2 Notes - Senior Notes - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total debt | $ 1,290,251 | $ 1,290,251 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total debt | $ 1,351,057 | $ 1,354,241 |
Derivative Instruments (Narrati
Derivative Instruments (Narrative) (Details) - USD ($) | Jul. 02, 2019 | Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | Jun. 30, 2015 |
Derivative [Line Items] | |||||
Payments to terminate derivative contract | $ 0 | $ 0 | $ 23,551,000 | ||
Interest Rate Swap 1 | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | $ 500,000,000 | ||||
Interest Rate Swaps | |||||
Derivative [Line Items] | |||||
Payments to terminate derivative contract | $ 23,600,000 | ||||
Interest rate swaps hedge ineffectiveness | $ 0 |
Derivative Instruments (Gains o
Derivative Instruments (Gains or Losses Recognized on Interest Rate Swap Derivative Instrument) (Details) $ in Thousands | 12 Months Ended |
Sep. 29, 2019USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Loss reclassified from accumulated OCI into net earnings | $ 24,328 |
Interest rate swaps | Derivatives designated as hedging instruments | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Loss recognized in OCI | (23,625) |
Interest rate swaps | Interest expense, net | Derivatives designated as hedging instruments | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Loss reclassified from accumulated OCI into net earnings | $ 24,328 |
Indebtedness (Schedule of Long-
Indebtedness (Schedule of Long-Term Debt) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Debt Instrument [Line Items] | ||
Class A-1 Variable Funding Notes | $ 0 | $ 107,876 |
Finance lease obligations | 2,275 | 2,934 |
Total debt | 1,292,526 | 1,401,061 |
Less current maturities of long-term debt | (894) | (818) |
Less unamortized debt issuance costs | (18,212) | (23,330) |
Long-term debt | 1,273,420 | 1,376,913 |
Senior Notes | Class A-2-I Notes | ||
Debt Instrument [Line Items] | ||
Senior secured notes | 570,688 | 570,688 |
Senior Notes | Class A-2-II Notes | ||
Debt Instrument [Line Items] | ||
Senior secured notes | 272,938 | 272,938 |
Senior Notes | Class A-2-III Notes | ||
Debt Instrument [Line Items] | ||
Senior secured notes | $ 446,625 | $ 446,625 |
Indebtedness (Narrative) (Detai
Indebtedness (Narrative) (Details) | Jul. 08, 2019USD ($)extnsion_option | Oct. 03, 2021USD ($) | Sep. 27, 2020USD ($) | Sep. 29, 2019USD ($) | Apr. 11, 2021USD ($) |
Debt Instrument [Line Items] | |||||
Loss on extinguishment of debt | $ 0 | $ 0 | $ 2,757,000 | ||
Securitization Transaction | |||||
Debt Instrument [Line Items] | |||||
Deferred financing costs | $ 33,000,000 | ||||
Senior Notes | Class A-2-I Notes | |||||
Debt Instrument [Line Items] | |||||
Proceeds from issuance of secured debt | $ 575,000,000 | ||||
Interest rate | 3.982% | ||||
Senior secured notes | $ 570,688,000 | 570,688,000 | |||
Effective interest rate | 4.545% | ||||
Senior Notes | Class A-2-II Notes | |||||
Debt Instrument [Line Items] | |||||
Proceeds from issuance of secured debt | $ 275,000,000 | ||||
Interest rate | 4.476% | ||||
Senior secured notes | $ 272,938,000 | 272,938,000 | |||
Effective interest rate | 4.80% | ||||
Senior Notes | Class A-2-III Notes | |||||
Debt Instrument [Line Items] | |||||
Proceeds from issuance of secured debt | $ 450,000,000 | ||||
Interest rate | 4.97% | ||||
Senior secured notes | $ 446,625,000 | 446,625,000 | |||
Effective interest rate | 5.198% | ||||
Senior Notes | Class A-2 Notes | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 150,000,000 | ||||
Quarterly principal payment | $ 3,250,000 | ||||
Specified maximum leverage ratio | 5 | 5 | |||
Number of extensions for variable funding notes | extnsion_option | 2 | ||||
Interest rate after repayment date | 5.00% | ||||
Length of extension period | 1 year | ||||
Letters of credit outstanding, amount | $ 39,500,000 | $ 39,500,000 | |||
Senior secured notes | $ 107,900,000 | ||||
Unused borrowing capacity | $ 110,500,000 | ||||
Senior Notes | Maximum | Class A-2 Notes | |||||
Debt Instrument [Line Items] | |||||
Scaled commitment fee (percent) | 1000.00% | ||||
Senior Notes | Minimum | Class A-2 Notes | |||||
Debt Instrument [Line Items] | |||||
Scaled commitment fee (percent) | 500.00% | ||||
Interest expense, net | |||||
Debt Instrument [Line Items] | |||||
Loss on extinguishment of debt | $ 2,800,000 |
Indebtedness (Scheduled Princip
Indebtedness (Scheduled Principal Payments of Long-Term Debt) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Debt Disclosure [Abstract] | ||
2022 | $ 894 | |
2023 | 571,610 | |
2024 | 372 | |
2025 | 38 | |
2026 | 272,964 | |
Thereafter | 446,648 | |
Total debt | $ 1,292,526 | $ 1,401,061 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) | Oct. 03, 2021 |
Property Subject to or Available for Operating Lease [Line Items] | |
Lease term (in years) | 20 years |
Minimum | |
Property Subject to or Available for Operating Lease [Line Items] | |
Lease renewal option as lessor (in years) | 1 year |
Minimum | Restaurant and Office Equipment | |
Property Subject to or Available for Operating Lease [Line Items] | |
Lease term (in years) | 3 years |
Maximum | |
Property Subject to or Available for Operating Lease [Line Items] | |
Lease renewal option as lessor (in years) | 20 years |
Maximum | Restaurant and Office Equipment | |
Property Subject to or Available for Operating Lease [Line Items] | |
Lease term (in years) | 8 years |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Leases [Abstract] | ||
Operating lease, right-of-use assets | $ 934,066 | $ 904,548 |
Finance lease, right-of-use assets | 1,698 | 2,333 |
Total right-of-use assets | 935,764 | 906,881 |
Current operating lease liabilities | 150,636 | 179,000 |
Current finance lease liabilities | 894 | 818 |
Long-term operating lease liabilities | 809,191 | 776,094 |
Long-term finance lease liabilities | 1,381 | 2,116 |
Total lease liabilities | $ 962,102 | $ 958,028 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant and Equipment, Net | Property, Plant and Equipment, Net |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Current maturities of long-term debt | Current maturities of long-term debt |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-term debt | Long-term debt |
Leases - Lessee Lease Costs (De
Leases - Lessee Lease Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Finance lease cost: | ||
Amortization of ROU assets | $ 807 | $ 767 |
Interest on lease liabilities | 89 | 110 |
Operating lease cost | 194,149 | 190,461 |
Short-term lease cost | 427 | 175 |
Variable lease cost | 43,498 | 40,798 |
Lease cost, total | 238,970 | 232,311 |
Property taxes and common area maintenance costs | $ 38,000 | $ 37,400 |
Weighted-average remaining lease term (in years): | ||
Finance leases | 2 years 4 months 24 days | 3 years 3 months 18 days |
Operating leases | 9 years | 8 years 3 months 18 days |
Weighted-average discount rate: | ||
Finance leases | 3.60% | 3.50% |
Operating leases | 4.10% | 4.20% |
Leases (Components of Rent Expe
Leases (Components of Rent Expense) (Details) $ in Thousands | 12 Months Ended |
Sep. 29, 2019USD ($) | |
Leases [Abstract] | |
Minimum rentals | $ 184,587 |
Contingent rentals | 2,255 |
Total rent expense | $ 186,842 |
Leases Finance and Operating Le
Leases Finance and Operating Lease Payments (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Finance Leases | ||
2022 | $ 961 | |
2023 | 944 | |
2024 | 413 | |
2025 | 50 | |
2026 | 25 | |
Thereafter | 27 | |
Total future lease payments | 2,420 | |
Less: imputed interest | (145) | |
Present value of lease liabilities | 2,275 | $ 2,934 |
Less current portion | (894) | (818) |
Long-term lease obligations | 1,381 | 2,116 |
Finance lease, noncancellable commitments | 2,400 | |
Operating Leases | ||
2022 | 186,717 | |
2023 | 161,788 | |
2024 | 128,816 | |
2025 | 122,114 | |
2026 | 106,582 | |
Thereafter | 460,138 | |
Total future lease payments | 1,166,155 | |
Less: imputed interest | (206,328) | |
Present value of lease liabilities | 959,827 | |
Less current portion | (150,636) | (179,000) |
Long-term lease obligations | 809,191 | $ 776,094 |
Operating lease, noncancellable commitments | $ 1,000,000 |
Leases (Assets Recorded Under F
Leases (Assets Recorded Under Finance Leases) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Property, plant and Equipment [Line Items] | ||
Less accumulated amortization | $ (5,513) | $ (4,640) |
Finance lease, right-of-use assets | 1,698 | 2,333 |
Buildings | ||
Property, plant and Equipment [Line Items] | ||
Finance lease, right-of-use asset before amortization | 1,342 | 1,342 |
Equipment | ||
Property, plant and Equipment [Line Items] | ||
Finance lease, right-of-use asset before amortization | $ 5,869 | $ 5,631 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow and Non-cash Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 218,570 | $ 190,303 |
Operating cash flows from financing leases | 89 | 110 |
Financing cash flows from financing leases | 829 | 785 |
Supplemental noncash information on lease liabilities arising from obtaining right-of-use assets: | ||
Right-of-use assets obtained in exchange for new operating lease obligations | 186,621 | 181,532 |
Right-of-use assets obtained in exchange for new financing lease obligations | $ 184 | $ 132 |
Leases - Sale, Leaseback Transa
Leases - Sale, Leaseback Transactions (Details) $ in Thousands | 3 Months Ended | 4 Months Ended | 12 Months Ended | ||
Jul. 05, 2020USD ($) | Jan. 19, 2020USD ($)sale_leasebackTransaction | Oct. 03, 2021USD ($)sale_leasebackTransaction | Sep. 27, 2020USD ($)officeBuildingsale_leasebackTransaction | Sep. 29, 2019USD ($) | |
Sale Leaseback Transaction [Line Items] | |||||
Number of sales - leaseback transactions completed | sale_leasebackTransaction | 1 | 2 | 2 | ||
Proceeds from the sale and leaseback of assets | $ 3,884 | $ 19,828 | $ 4,447 | ||
Notice period for termination of lease without penalty | 90 days | ||||
Restaurant | |||||
Sale Leaseback Transaction [Line Items] | |||||
Proceeds from the sale and leaseback of assets | $ 2,400 | 3,900 | |||
Gain (loss) on sale and leaseback transaction | $ (100) | $ 100 | |||
Initial term of operating lease | 17 years | 20 years | |||
Multi-tenant Commercial Property | |||||
Sale Leaseback Transaction [Line Items] | |||||
Proceeds from the sale and leaseback of assets | $ 17,400 | ||||
Gain (loss) on sale and leaseback transaction | $ (200) | ||||
Initial term of operating lease | 20 years | ||||
Principal Executive Offices | |||||
Sale Leaseback Transaction [Line Items] | |||||
Number of sales - leaseback transactions completed | officeBuilding | 1 | ||||
Proceeds from the sale and leaseback of assets | $ 20,600 | ||||
Gain (loss) on sale and leaseback transaction | $ 10,800 | ||||
Initial term of operating lease | 18 months |
Leases - Rental Income (Details
Leases - Rental Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Lessor, Lease, Description [Line Items] | ||
Operating lease income - closed restaurants and other | $ 6,027 | $ 6,370 |
Owned Properties | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease income - closed restaurants and other | 0 | 0 |
Leased Properties | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease income - closed restaurants and other | 6,027 | 6,370 |
Franchise rental revenues | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease income - franchise | 238,160 | 235,800 |
Variable lease income - franchise | 108,474 | 84,847 |
Operating Lease, Lease Income, Total | 346,634 | 320,647 |
Franchise rental revenues | Owned Properties | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease income - franchise | 20,132 | 19,785 |
Variable lease income - franchise | 12,363 | 9,960 |
Operating Lease, Lease Income, Total | 32,495 | 29,745 |
Franchise rental revenues | Leased Properties | ||
Lessor, Lease, Description [Line Items] | ||
Operating lease income - franchise | 218,028 | 216,015 |
Variable lease income - franchise | 96,111 | 74,887 |
Operating Lease, Lease Income, Total | $ 314,139 | $ 290,902 |
Leases - Future Minimum Receipt
Leases - Future Minimum Receipts (Details) $ in Thousands | Oct. 03, 2021USD ($) |
Leases [Abstract] | |
2022 | $ 238,021 |
2023 | 231,342 |
2024 | 205,740 |
2025 | 214,526 |
2026 | 199,906 |
Thereafter | 939,239 |
Total minimum rental receipts | $ 2,028,774 |
Leases (Assets Held for Lease)
Leases (Assets Held for Lease) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Property Subject to or Available for Operating Lease [Line Items] | ||
Land | $ 105,393 | $ 100,460 |
Buildings | 907,792 | 914,311 |
Equipment | 112,959 | 112,675 |
Property and equipment, at cost | 1,133,038 | 1,132,430 |
Less accumulated depreciation | (810,124) | (796,448) |
Property and equipment, net | 322,914 | 335,982 |
Assets Leased to Others | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Land | 89,791 | 88,187 |
Buildings | 782,450 | 801,730 |
Equipment | 223 | 589 |
Property and equipment, at cost | 872,464 | 890,506 |
Less accumulated depreciation | (657,030) | (650,812) |
Property and equipment, net | $ 215,434 | $ 239,694 |
Impairment and Other (Gains) _3
Impairment and Other (Gains) Charges, Net (Impairment and Disposal Costs Included in Impairment and Other Charges) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Restructuring and Related Activities [Abstract] | |||
Gains on disposition of property and equipment, net | $ (6,888) | $ (9,768) | $ (6,244) |
Costs of closed restaurants and other | 1,907 | 1,872 | 8,628 |
Accelerated depreciation | 1,592 | 235 | 1,616 |
Restructuring costs | 7 | 1,168 | 8,455 |
Impairment and other charges, net | $ (3,382) | $ (6,493) | $ 12,455 |
Discontinued Operations (Narrat
Discontinued Operations (Narrative) (Details) $ in Millions | Mar. 21, 2018extnsion_option | Sep. 29, 2019USD ($) | Sep. 30, 2018USD ($) |
Discontinued Operations and Disposal Groups [Abstract] | |||
Discontinued operation, period of continuing involvement after disposal | 12 months | ||
Discontinued operation, period of continuing involvement after disposal, number of extension options | extnsion_option | 2 | ||
Discontinued operation, period of continuing involvement after disposal, service period extension option | 3 months | ||
Other nonrecurring income | $ 7 | ||
Disposal group, including discontinued operation, accrued income tax payable | $ 2.8 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Income tax (expense) benefit | $ 0 | $ (144) | $ 2,863 |
Earnings from discontinued operations, net of income taxes | $ 0 | 370 | 2,690 |
Qdoba | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Total revenues | 0 | 0 | |
Total cost and (income) expense | (514) | 173 | |
Earnings (losses) before income taxes | 514 | (173) | |
Income tax (expense) benefit | (144) | 2,863 | |
Earnings from discontinued operations, net of income taxes | $ 370 | $ 2,690 |
Income Taxes (Components of Inc
Income Taxes (Components of Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Income Tax Disclosure [Abstract] | |||
Current, Federal | $ 36,051 | $ 19,721 | $ 14,683 |
Current, State | 11,793 | 7,844 | 5,242 |
Total Current | 47,844 | 27,565 | 19,925 |
Deferred, Federal | 4,440 | 4,625 | 3,750 |
Deferred, State | 3,568 | 537 | 350 |
Total Deferred | 8,008 | 5,162 | 4,100 |
Income tax expense from continuing operations | 55,852 | 32,727 | 24,025 |
Income tax expense (benefit) from discontinued operations | $ 0 | $ 144 | $ (2,863) |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of the Federal Statutory Income Tax Rate to Effective Tax Rate) (Details) | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Income Tax Disclosure [Abstract] | |||
Income tax expense at federal statutory rate | 21.00% | 21.00% | 21.00% |
State income taxes, net of federal tax benefit | 5.10% | 5.30% | 5.30% |
Stock compensation excess tax benefit | (0.50%) | (0.40%) | (0.10%) |
Benefit of jobs tax credits, net of valuation allowance | (0.10%) | (0.50%) | (0.30%) |
Release of federal tax liability | 0.00% | 0.00% | (0.60%) |
Adjustment to state tax provision | 0.70% | 0.00% | (0.90%) |
Benefit related to COLIs | (1.50%) | (0.90%) | (1.00%) |
Termination of interest rate swaps | 0.00% | 0.00% | (2.60%) |
Officers’ compensation limitation | 0.50% | 2.20% | 1.10% |
Other, net | 0.00% | 0.10% | (1.10%) |
Effective tax rate | 25.20% | 26.80% | 20.80% |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets and Deferred Tax Liabilities) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Deferred tax assets: | ||
Operating and finance lease liabilities | $ 237,509 | $ 234,926 |
Accrued defined benefit pension and postretirement benefits | 28,837 | 44,436 |
Deferred income | 12,083 | 12,921 |
Impairment | 6,957 | 8,895 |
Accrued insurance | 5,389 | 6,500 |
Other reserves and allowances | 4,050 | 2,440 |
Share-based compensation | 4,039 | 4,143 |
Accrued incentive compensation | 3,455 | 2,585 |
Tax loss and tax credit carryforwards | 3,129 | 4,273 |
Accrued compensation expense | 710 | 672 |
Other, net | 3,424 | 2,364 |
Total gross deferred tax assets | 309,582 | 324,155 |
Valuation allowance | (1,349) | (2,104) |
Total net deferred tax assets | 308,233 | 322,051 |
Deferred tax liabilities: | ||
Operating and finance lease ROU assets | (242,038) | (235,373) |
Intangible assets | (11,349) | (11,437) |
Property and equipment, principally due to differences in depreciation | (1,036) | (1,781) |
Other | (2,293) | (1,138) |
Total gross deferred tax liabilities | (256,716) | (249,729) |
Net deferred tax assets | $ 51,517 | $ 72,322 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Income Tax Disclosure [Abstract] | ||
State net operating loss carryforwards | $ 16,600 | |
State net operating loss carryforwards, not subject to expiration | 12,100 | |
Valuation allowance | $ 1,349 | $ 2,104 |
Retirement Plans (Narrative) (D
Retirement Plans (Narrative) (Details) | Jan. 01, 2016 | Jan. 19, 2020USD ($) | Sep. 27, 2020USD ($) | Oct. 03, 2021USD ($)defined_benefit_plan | Sep. 27, 2020USD ($) | Sep. 29, 2019USD ($) |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Number of sponsored defined benefit pension plans | defined_benefit_plan | 2 | |||||
Lump sum payments from qualified plan | $ 122,300,000 | |||||
Pension settlement | $ 38,600,000 | $ 600,000 | ||||
Minimum required contribution for retirement plans | $ 0 | |||||
Qualified Defined Contribution Plan | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Minimum age of eligible employees | 21 years | |||||
Employer matching contribution, percent of match | 100.00% | |||||
Employer matching contribution, percent of employees' gross pay | 4.00% | |||||
Defined contribution plan, Company contributions | $ 1,600,000 | $ 1,600,000 | $ 1,700,000 | |||
Non-Qualified Deferred Compensation Plan | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Defined contribution plan, Company contributions | $ 100,000 | $ 300,000 | $ 200,000 | |||
Maximum annual contributions per employee, percent | 50.00% | |||||
Maximum annual contributions per employee, percent of bonus | 85.00% |
Retirement Plans (Reconciliatio
Retirement Plans (Reconciliation of Changes in Benefit Obligations, Plan Assets and Funded Status of Retirement Plans) (Details) - USD ($) $ in Thousands | 4 Months Ended | 12 Months Ended | ||
Jan. 19, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ||||
Fair value at beginning of year | $ 365,510 | |||
Settlements | $ (122,300) | |||
Fair value at end of year | 409,708 | $ 365,510 | ||
Defined Benefit Plan, Amounts for Asset (Liability) Recognized in Statement of Financial Position [Abstract] | ||||
Net actuarial (gain) loss | (44,134) | 4,875 | $ 62,377 | |
Total recognized in OCI | (49,065) | (39,741) | 58,460 | |
Supplemental Employee Retirement Plan | ||||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||||
Obligation at beginning of year | 79,893 | 78,971 | 79,893 | |
Interest cost | 2,169 | 2,499 | 3,080 | |
Participant contributions | 0 | 0 | ||
Actuarial (gain) loss | (672) | 1,739 | ||
Benefits paid | (5,243) | (5,160) | ||
Settlements | 0 | 0 | ||
Other | 0 | 0 | ||
Obligation at end of year | 75,225 | 78,971 | 79,893 | |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ||||
Fair value at beginning of year | 0 | 0 | 0 | |
Actual return on plan assets | 0 | 0 | ||
Participant contributions | 0 | 0 | ||
Employer contributions | 5,243 | 5,160 | ||
Benefits paid | (5,243) | (5,160) | ||
Settlements | 0 | 0 | ||
Other | 0 | 0 | ||
Fair value at end of year | 0 | 0 | 0 | |
Unfunded status at end of year | (75,225) | (78,971) | ||
Defined Benefit Plan, Amounts for Asset (Liability) Recognized in Statement of Financial Position [Abstract] | ||||
Current liabilities | (5,216) | (5,223) | ||
Noncurrent liabilities | (70,009) | (73,748) | ||
Total liability recognized | (75,225) | (78,971) | ||
Unamortized actuarial loss (gain), net | 32,475 | 34,890 | ||
Unamortized prior service cost | 53 | 72 | ||
Total | 32,528 | 34,962 | ||
Net actuarial (gain) loss | (672) | 1,739 | ||
Pension settlement costs | 0 | 0 | ||
Amortization of actuarial (loss) gain | (1,743) | (1,652) | ||
Amortization of prior service cost | (19) | (85) | ||
Total recognized in OCI | (2,434) | 2 | ||
Net periodic benefit (credit) cost and other losses | 3,931 | 4,236 | 4,402 | |
Total recognized in comprehensive income | 1,497 | 4,238 | ||
Net actuarial loss (gain) | 1,666 | |||
Prior service cost | 19 | |||
Total | 1,685 | |||
Postretirement Health Plans | ||||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||||
Obligation at beginning of year | 25,632 | 20,965 | 25,632 | |
Interest cost | 563 | 807 | 997 | |
Participant contributions | 112 | 106 | ||
Actuarial (gain) loss | (3,525) | (4,391) | ||
Benefits paid | (1,044) | (1,246) | ||
Settlements | 0 | 0 | ||
Other | 91 | 57 | ||
Obligation at end of year | 17,162 | 20,965 | 25,632 | |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ||||
Fair value at beginning of year | 0 | 0 | 0 | |
Actual return on plan assets | 0 | 0 | ||
Participant contributions | 112 | 106 | ||
Employer contributions | 841 | 1,083 | ||
Benefits paid | (1,044) | (1,246) | ||
Settlements | 0 | 0 | ||
Other | 91 | 57 | ||
Fair value at end of year | 0 | 0 | 0 | |
Unfunded status at end of year | (17,162) | (20,965) | ||
Defined Benefit Plan, Amounts for Asset (Liability) Recognized in Statement of Financial Position [Abstract] | ||||
Current liabilities | (1,115) | (1,243) | ||
Noncurrent liabilities | (16,047) | (19,722) | ||
Total liability recognized | (17,162) | (20,965) | ||
Unamortized actuarial loss (gain), net | (7,359) | (4,174) | ||
Unamortized prior service cost | 0 | 0 | ||
Total | (7,359) | (4,174) | ||
Net actuarial (gain) loss | (3,526) | (4,391) | ||
Pension settlement costs | 0 | 0 | ||
Amortization of actuarial (loss) gain | 341 | (18) | ||
Amortization of prior service cost | 0 | 0 | ||
Total recognized in OCI | (3,185) | (4,409) | ||
Net periodic benefit (credit) cost and other losses | 222 | 825 | 838 | |
Total recognized in comprehensive income | (2,963) | (3,584) | ||
Net actuarial loss (gain) | (640) | |||
Prior service cost | 0 | |||
Total | (640) | |||
Qualified Pension Plan | ||||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||||
Obligation at beginning of year | 521,931 | 412,573 | 521,931 | |
Interest cost | 12,558 | 13,377 | 19,825 | |
Participant contributions | 0 | 0 | ||
Actuarial (gain) loss | (785) | 14,498 | ||
Benefits paid | (14,293) | (12,980) | ||
Settlements | 0 | (124,253) | ||
Other | 0 | 0 | ||
Obligation at end of year | 410,053 | 412,573 | 521,931 | |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ||||
Fair value at beginning of year | $ 476,194 | 365,510 | 476,194 | |
Actual return on plan assets | 58,491 | 26,549 | ||
Participant contributions | 0 | 0 | ||
Employer contributions | 0 | 0 | ||
Benefits paid | (14,293) | (12,980) | ||
Settlements | 0 | (124,253) | ||
Other | 0 | 0 | ||
Fair value at end of year | 409,708 | 365,510 | 476,194 | |
Unfunded status at end of year | (345) | (47,063) | ||
Defined Benefit Plan, Amounts for Asset (Liability) Recognized in Statement of Financial Position [Abstract] | ||||
Current liabilities | 0 | 0 | ||
Noncurrent liabilities | (345) | (47,063) | ||
Total liability recognized | (345) | (47,063) | ||
Unamortized actuarial loss (gain), net | 108,922 | 152,370 | ||
Unamortized prior service cost | 0 | 0 | ||
Total | 108,922 | 152,370 | ||
Net actuarial (gain) loss | (39,936) | 7,527 | ||
Pension settlement costs | 0 | (39,218) | ||
Amortization of actuarial (loss) gain | (3,510) | (3,644) | ||
Amortization of prior service cost | 0 | 0 | ||
Total recognized in OCI | (43,446) | (35,335) | ||
Net periodic benefit (credit) cost and other losses | (3,272) | 36,661 | $ (3,755) | |
Total recognized in comprehensive income | (46,718) | $ 1,326 | ||
Net actuarial loss (gain) | 2,193 | |||
Prior service cost | 0 | |||
Total | $ 2,193 |
Retirement Plans (Fair Value of
Retirement Plans (Fair Value of Plan Assets of Pension Plans) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 409,708 | $ 365,510 | |
Supplemental Employee Retirement Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Projected benefit obligation | 75,225 | 78,971 | $ 79,893 |
Accumulated benefit obligation | 75,225 | 78,971 | |
Fair value of plan assets | 0 | 0 | 0 |
Qualified Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Projected benefit obligation | 410,053 | 412,573 | 521,931 |
Accumulated benefit obligation | 410,053 | 412,573 | |
Fair value of plan assets | $ 409,708 | $ 365,510 | $ 476,194 |
Retirement Plans (Components of
Retirement Plans (Components of Net Periodic Benefit Cost) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Supplemental Employee Retirement Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | $ 2,169 | $ 2,499 | $ 3,080 |
Actuarial loss | 1,743 | 1,652 | 1,207 |
Amortization of unrecognized prior service cost | 19 | 85 | 115 |
Net periodic benefit (credit) cost | 3,931 | 4,236 | 4,402 |
Postretirement Health Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | 563 | 807 | 997 |
Actuarial loss | (341) | 18 | (159) |
Net periodic benefit (credit) cost | 222 | 825 | 838 |
Qualified Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | 12,558 | 13,377 | 19,825 |
Expected return on plan assets | (19,340) | (19,578) | (26,334) |
Pension settlements | 0 | 39,218 | 0 |
Actuarial loss | 3,510 | 3,644 | 2,754 |
Net periodic benefit (credit) cost | $ (3,272) | $ 36,661 | $ (3,755) |
Retirement Plans (Determining t
Retirement Plans (Determining the Present Values of Benefit Obligations and Net Periodic Benefit Costs) (Details) $ in Millions | 3 Months Ended | 4 Months Ended | 12 Months Ended | |||
Jul. 04, 2021 | Apr. 11, 2021 | Jan. 17, 2021 | Oct. 03, 2021USD ($)restaurant | Sep. 27, 2020 | Sep. 29, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Cash flow period extension | 30 | |||||
Decrease in earnings before income taxes from 0.25% decrease in the discount rate | $ 0.1 | |||||
Decrease in earnings before income taxes from 0.25% decrease in the long-term rate of return on assets | $ 0.9 | |||||
Supplemental Employee Retirement Plan | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Assumptions used to determine benefit obligations, Discount rate | 2.99% | 2.84% | 3.24% | |||
Assumptions used to determine benefit obligations, Rate of future pay increases | 3.50% | |||||
Assumptions used to determine net periodic benefit cost, Discount rate | 2.84% | 3.24% | 4.37% | |||
Assumptions used to determine net periodic benefit cost, Rate of future pay increases | 3.50% | 3.50% | ||||
Number of active employees | restaurant | 0 | |||||
Postretirement Health Plans | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Assumptions used to determine benefit obligations, Discount rate | 2.95% | 2.77% | 3.24% | |||
Assumptions used to determine net periodic benefit cost, Discount rate | 2.77% | 3.24% | 4.38% | |||
Qualified Pension Plan | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Assumptions used to determine benefit obligations, Discount rate | 3.11% | 3.10% | 3.36% | |||
Assumptions used to determine net periodic benefit cost, Discount rate | 3.13% | 3.38% | 3.61% | 3.10% | 3.36% | 4.40% |
Assumptions used to determine net periodic benefit cost, Long-term rate of return on assets | 5.40% | 5.20% | 5.90% | 5.40% | 5.80% | 5.85% |
Retirement Plans (Health Care C
Retirement Plans (Health Care Cost Trend Rates for Postretirement Health Plans) (Details) | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Participants under age 65 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Health care cost trend rate for next year | 6.50% | 6.75% | 7.00% |
Rate to which the cost trend rate is assumed to decline | 4.50% | 4.50% | 4.50% |
Year the rate reaches the ultimate trend rate | 2030 | 2030 | 2030 |
Participants age 65 or older | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Health care cost trend rate for next year | 6.00% | 6.25% | 6.50% |
Rate to which the cost trend rate is assumed to decline | 4.50% | 4.50% | 4.50% |
Year the rate reaches the ultimate trend rate | 2028 | 2028 | 2028 |
Retirement Plans (Effect of Cha
Retirement Plans (Effect of Change in Assumed Health Care Cost Trend Rate) (Details) $ in Thousands | 12 Months Ended |
Oct. 03, 2021USD ($) | |
Retirement Benefits [Abstract] | |
Total interest and service cost, 1% Point Increase | $ 53 |
Total interest and service cost, 1% Point Decrease | (46) |
Postretirement benefit obligation, 1% Point Increase | 1,604 |
Postretirement benefit obligation, 1% Point Decrease | $ (1,405) |
Retirement Plans (Schedule of P
Retirement Plans (Schedule of Plan Asset Allocation) (Details) | Oct. 03, 2021 |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 100.00% |
Asset allocation, target, equity securities | 100.00% |
Cash & cash equivalents | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 1.00% |
Asset allocation, target, equity securities | 1.00% |
Domestic equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 16.00% |
Asset allocation, target, equity securities | 16.00% |
International equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 15.00% |
Asset allocation, target, equity securities | 16.00% |
Core fixed funds | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 49.00% |
Asset allocation, target, equity securities | 48.00% |
High yield | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 2.00% |
Asset allocation, target, equity securities | 3.00% |
Alternative investments | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 7.00% |
Asset allocation, target, equity securities | 6.00% |
Real estate | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 5.00% |
Asset allocation, target, equity securities | 5.00% |
Real return bonds | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of plan assets, equity securities | 5.00% |
Asset allocation, target, equity securities | 5.00% |
Minimum | Cash & cash equivalents | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 0.00% |
Minimum | Domestic equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 8.00% |
Minimum | International equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 8.00% |
Minimum | Core fixed funds | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 43.00% |
Minimum | High yield | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 0.00% |
Minimum | Alternative investments | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 0.00% |
Minimum | Real estate | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 0.00% |
Minimum | Real return bonds | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 0.00% |
Maximum | Cash & cash equivalents | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 0.00% |
Maximum | Domestic equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 24.00% |
Maximum | International equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 24.00% |
Maximum | Core fixed funds | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 53.00% |
Maximum | High yield | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 6.00% |
Maximum | Alternative investments | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 12.00% |
Maximum | Real estate | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 10.00% |
Maximum | Real return bonds | |
Defined Benefit Plan Disclosure [Line Items] | |
Asset allocation, target, equity securities | 12.00% |
Retirement Plans (Fair Values o
Retirement Plans (Fair Values of Qualified Plan's Assets) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | $ 409,708 | $ 365,510 |
Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 1,969 | 3,665 |
Domestic equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 66,921 | 83,676 |
International equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 63,087 | 81,228 |
Investment grade | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 219,295 | 126,630 |
High yield | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 10,156 | 9,270 |
Alternatives | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 26,519 | 29,375 |
Real estate | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 21,761 | 31,666 |
Quoted Prices in Active Markets for Identical (Level 1) | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 128,906 | 136,271 |
Quoted Prices in Active Markets for Identical (Level 1) | Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Quoted Prices in Active Markets for Identical (Level 1) | Domestic equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 66,921 | 83,676 |
Quoted Prices in Active Markets for Identical (Level 1) | International equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 31,128 | 40,319 |
Quoted Prices in Active Markets for Identical (Level 1) | Investment grade | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 20,701 | 3,006 |
Quoted Prices in Active Markets for Identical (Level 1) | High yield | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 10,156 | 9,270 |
Quoted Prices in Active Markets for Identical (Level 1) | Alternatives | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Quoted Prices in Active Markets for Identical (Level 1) | Real estate | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 200,563 | 127,289 |
Significant Other Observable Inputs (Level 2) | Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 1,969 | 3,665 |
Significant Other Observable Inputs (Level 2) | Domestic equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Other Observable Inputs (Level 2) | International equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Investment grade | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 198,594 | 123,624 |
Significant Other Observable Inputs (Level 2) | High yield | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Alternatives | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Real estate | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Domestic equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | International equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Investment grade | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | High yield | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Alternatives | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Real estate | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | $ 0 | $ 0 |
Retirement Plans (Contributions
Retirement Plans (Contributions Expected to be Paid in Next Fiscal Year and Projected Benefit Payments) (Details) $ in Thousands | Oct. 03, 2021USD ($) |
Defined Benefit Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Estimated net contributions during fiscal 2022 | $ 5,216 |
2022 | 20,051 |
2023 | 20,092 |
2024 | 20,302 |
2025 | 20,746 |
2026 | 21,295 |
2027-2031 | 114,002 |
Postretirement Health Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Estimated net contributions during fiscal 2022 | 1,132 |
2022 | 1,132 |
2023 | 1,152 |
2024 | 1,168 |
2025 | 1,179 |
2026 | 1,182 |
2027-2031 | $ 5,708 |
Share-Based Employee Compensa_3
Share-Based Employee Compensation (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | Jul. 31, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Value of shares issued in connection with director retirements (less than) | $ 0.1 | |||
Nonvested stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
Awards outstanding (in shares) | 141,197 | 175,141 | ||
Total unrecognized compensation cost related to stock options granted | $ 4.4 | |||
Weighted-average period for unrecognized compensation cost, (in years) | 2 years 3 months 18 days | |||
Weighted-average grant-date fair value (in usd per share) | $ 95.44 | $ 73.94 | $ 86.08 | |
Total fair value of awards vested | $ 4.3 | $ 8.7 | $ 4.7 | |
Modified restricted stock units vested in period (in shares) | 81,968 | |||
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Total unrecognized compensation cost related to stock options granted | $ 0.1 | |||
Weighted-average period for unrecognized compensation cost, (in years) | 1 year 2 months 12 days | |||
Option grants contractual term | seven years | |||
Total intrinsic value of stock options exercised | $ 1.6 | $ 0.7 | $ 0.5 | |
Performance share awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Awards outstanding (in shares) | 35,097 | 25,042 | ||
Total unrecognized compensation cost related to stock options granted | $ 1.4 | |||
Weighted-average period for unrecognized compensation cost, (in years) | 2 years | |||
Weighted-average grant-date fair value (in usd per share) | $ 88.88 | $ 81.02 | $ 84.60 | |
Total fair value of awards vested | $ 0.6 | $ 0.5 | $ 2.1 | |
Modified restricted stock units vested in period (in shares) | 8,717 | |||
Modified Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Modified restricted stock units vested in period (in shares) | 23,128 | |||
Deferred Compensation for Non Management Directors | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding (in shares) | 109,463 | 105,876 | ||
Shares issued in connection with director retiremenst (shares) | 0 | 204 | 0 | |
Minimum | Nonvested stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock units vested, percentage | 50.00% | |||
Minimum | Performance share awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance share awards vesting rights, percentage | 0.00% | |||
Maximum | Performance share awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance share awards vesting rights, percentage | 150.00% | |||
Executive Officers | Nonvested stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding (in shares) | 38,650 | |||
Non-Management Directors | Nonvested stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 12 months | |||
Awards outstanding (in shares) | 66,250 | |||
Management | Nonvested stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Awards outstanding (in shares) | 36,297 | |||
Two Thousand Four Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Authorized (in shares) | 11,600,000 | |||
Common stock available for future issuance (in shares) | 1,755,983 | |||
Deferred Compensation Plan for Non-Management Directors | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Authorized (in shares) | 350,000 | |||
Common stock available for future issuance (in shares) | 142,918 |
Share-Based Employee Compensa_4
Share-Based Employee Compensation (Components of Share-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | $ 4,048 | $ 4,394 | $ 8,074 |
Nonvested stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | 2,969 | 3,526 | 5,458 |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | 25 | 351 | 936 |
Performance share awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | 830 | 254 | 1,417 |
Non-management directors’ deferred compensation | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | $ 224 | $ 263 | $ 263 |
Share-Based Employee Compensa_5
Share-Based Employee Compensation (Summary of RSU Activity) (Details) - Nonvested stock units - $ / shares | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Shares | |||
Awards outstanding, beginning | 175,141 | ||
Granted in period (shares) | 66,811 | ||
Released (in shares) | (81,968) | ||
Forfeited (in shares) | (18,787) | ||
Awards outstanding, ending | 141,197 | 175,141 | |
Weighted- Average Grant Date Fair Value | |||
Awards outstanding, Weighted-Average Grant Date Fair Value, Beginning balance (in usd per share) | $ 59.65 | ||
Granted, Weighted-Average Grant Date Fair Value (in usd per share) | 95.44 | $ 73.94 | $ 86.08 |
Released, Weighted-Average Grant Date Fair Value (in usd per share) | 52.77 | ||
Cancelled, Weighted-Average Grant Date Fair Value(in usd per share) | 87.70 | ||
Awards outstanding, Weighted-Average Grant Date Fair Value, Ending balance (in usd per share) | $ 76.84 | $ 59.65 |
Share-Based Employee Compensa_6
Share-Based Employee Compensation (Summary of Stock Option Activity) (Details) - Stock options $ / shares in Units, $ in Thousands | 12 Months Ended |
Oct. 03, 2021USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Options outstanding, beginning balance (in shares) | 207,463 |
Granted (in shares) | 0 |
Exercised (in shares) | (75,028) |
Forfeited (in shares) | (15,100) |
Expired (in shares) | (84,218) |
Options outstanding, ending balance (in shares) | 33,117 |
Options exercisable (in shares) | 27,109 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |
Options outstanding, Weighted Average Exercise Price, Beginning balance (in usd per share) | $ / shares | $ 91.85 |
Options outstanding, Weighted Average Exercise Price, Exercised (in usd per share) | $ / shares | 88.60 |
Options outstanding, Weighted Average Exercise Price, Forfeited (in usd per share) | $ / shares | 76.29 |
Options outstanding, Weighted Average Exercise Price, Expired (in usd per share) | $ / shares | 97.31 |
Options outstanding, Weighted Average Exercise Price, Ending balance (in usd per share) | $ / shares | 92.44 |
Options exercisable, Weighted Average Exercise Price (in usd per share) | $ / shares | $ 96.26 |
Options outstanding, Weighted Average Remaining Contractual Term, years | 3 years 3 months 7 days |
Options exercisable, Weighted Average Remaining Contractual Term, years | 2 years 10 months 2 days |
Options outstanding, Aggregate Intrinsic Value | $ | $ 315 |
Options exercisable, Aggregate Intrinsic Value | $ | $ 169 |
Share-Based Employee Compensa_7
Share-Based Employee Compensation (Schedule of Weighted-Average Assumptions) (Details) - Stock options | 12 Months Ended |
Sep. 27, 2020$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate | 1.70% |
Expected dividends yield | 2.10% |
Expected stock price volatility | 28.10% |
Expected life of options (in years) | 3 years 5 months 19 days |
Weighted-average grant date fair value | $ 13.97 |
Share-Based Employee Compensa_8
Share-Based Employee Compensation (Summary of PSU Activity) (Details) - Performance share awards - $ / shares | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Shares | |||
Awards outstanding, beginning | 25,042 | ||
Granted (in shares) | 28,166 | ||
Issued (in shares) | (8,717) | ||
Forfeited (in shares) | (11,026) | ||
Performance adjustments (shares) | 1,632 | ||
Awards outstanding, ending | 35,097 | 25,042 | |
Weighted- Average Grant Date Fair Value | |||
Awards outstanding, Weighted-Average Grant Date Fair Value, Beginning balance (in usd per share) | $ 63.59 | ||
Granted, Weighted-Average Grant Date Fair Value (in usd per share) | 88.88 | $ 81.02 | $ 84.60 |
Issued, Weighted-Average Grant Date Fair Value (in usd per share) | 63.61 | ||
Forfeited, Weighted- Average Grant Date Fair Value (in usd per share) | 82.49 | ||
Performance adjustments, Weighted- Average Grant Date Fair Value(in usd per share) | 82.80 | ||
Awards outstanding, Weighted-Average Grant Date Fair Value, Ending balance (in usd per share) | $ 79.92 | $ 63.59 |
Share-Based Employee Compensa_9
Share-Based Employee Compensation (Summary of Performance Share Award Activity) (Details) - Deferred Compensation for Non Management Directors | 12 Months Ended |
Oct. 03, 2021$ / sharesshares | |
Shares | |
Awards outstanding, beginning | shares | 105,876 |
Deferred directors’ compensation, Shares | shares | 1,334 |
Dividend equivalents, Shares | shares | 2,253 |
Awards outstanding, ending | shares | 109,463 |
Weighted- Average Grant Date Fair Value | |
Awards outstanding, Weighted-Average Grant Date Fair Value, Beginning balance (in usd per share) | $ / shares | $ 40.96 |
Deferred directors' compensation, Weighted-Average Grant Date Fair Value (in usd per share) | $ / shares | 108.70 |
Dividend equivalents, Weighted-Average Grant Date Fair Value (in usd per share) | $ / shares | $ 102.80 |
Awards outstanding, Weighted-Average Grant Date Fair Value, Ending balance (in usd per share) | $ / shares | $ 43.06 |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) $ / shares in Units, $ in Thousands, shares in Millions | 3 Months Ended | 4 Months Ended | 12 Months Ended | ||||
Oct. 03, 2021USD ($)$ / shares | Jul. 04, 2021$ / shares | Apr. 11, 2021$ / shares | Jan. 17, 2021$ / shares | Oct. 03, 2021USD ($)restaurant$ / sharesshares | Sep. 27, 2020USD ($)$ / shares | Sep. 29, 2019USD ($)$ / shares | |
Stockholders' Equity Note [Abstract] | |||||||
Shares repurchased (in shares) | shares | 1.9 | ||||||
Cost of shares repurchased | $ 200,000 | $ 153,550 | $ 125,317 | ||||
Remaining amount under stock repurchase program | $ 0 | $ 0 | |||||
Number of cash dividends declared | restaurant | 4 | ||||||
Amount of each of the three cash dividends declared per common share (in usd per share) | $ / shares | $ 0.44 | $ 0.44 | $ 0.40 | $ 0.40 | $ 1.68 | $ 1.20 | $ 1.60 |
Total cash dividends | $ 37,600 |
Average Shares Outstanding (Rec
Average Shares Outstanding (Reconciliation of Basic Weighted-Average Shares Outstanding to Diluted Weighted-Average Shares Outstanding) (Details) - shares shares in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Average Shares Outstanding [Line Items] | |||
Weighted-average shares outstanding - basic (in shares) | 22,402 | 23,125 | 25,823 |
Weighted-average shares outstanding - diluted (in shares) | 22,478 | 23,269 | 26,068 |
Antidilutive (in shares) | 29 | 318 | 186 |
Performance conditions not satisfied at the end of the period (in shares) | 25 | 14 | 65 |
Nonvested stock awards and units | |||
Average Shares Outstanding [Line Items] | |||
Effect of potentially dilutive securities (in shares) | 62 | 137 | 211 |
Stock options | |||
Average Shares Outstanding [Line Items] | |||
Effect of potentially dilutive securities (in shares) | 9 | 0 | 10 |
Performance share awards | |||
Average Shares Outstanding [Line Items] | |||
Effect of potentially dilutive securities (in shares) | 5 | 7 | 24 |
Commitments and Contingencies (
Commitments and Contingencies (Additional Information) (Details) | 1 Months Ended | 12 Months Ended | |
Aug. 31, 2010former_employee | Oct. 03, 2021USD ($) | Sep. 27, 2020USD ($) | |
Loss Contingencies [Line Items] | |||
Estimated litigation liability | $ 7,500,000 | $ 3,800,000 | |
Lease guarantee | $ 26,700,000 | ||
Qdoba guaranteed leases, remaining term | 16 years | ||
Coca-Cola and Dr. Pepper Purchase Commitments | |||
Loss Contingencies [Line Items] | |||
Unconditional purchase obligations | $ 51,300,000 | ||
Coca-Cola | |||
Loss Contingencies [Line Items] | |||
Unrecorded purchase obligation period | 4 years | ||
Dr. Pepper | |||
Loss Contingencies [Line Items] | |||
Unrecorded purchase obligation period | 5 years | ||
Vendors Providing Information Technology Services | |||
Loss Contingencies [Line Items] | |||
Unrecorded purchase obligation period | 2 years | ||
Unconditional purchase obligations | $ 7,300,000 | ||
Information technology services, early contract termination fees | $ 0 | ||
Gessele v. Jack in the Box Inc. | |||
Loss Contingencies [Line Items] | |||
Number of former employees who instituted litigation | former_employee | 5 |
Supplemental Consolidated Cas_3
Supplemental Consolidated Cash Flow Information (Additional Information Related to Cash Flows) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 | |
Supplemental Cash Flow Information [Abstract] | |||
Income tax payments | $ 48,200 | $ 29,360 | $ 14,906 |
Interest, net of amounts capitalized | 60,413 | 68,612 | 46,227 |
Increase in dividends accrued or converted to common stock equivalents | 232 | 117 | 247 |
Consideration for franchise acquisitions | 1,305 | 859 | 0 |
Increase (decrease) in obligations for purchases of property and equipment | 1,755 | (2,696) | (2,117) |
Decrease in obligations for treasury stock repurchases | $ 0 | $ (2,025) | $ (12,337) |
Supplemental Consolidated Fin_3
Supplemental Consolidated Financial Statement Information (Schedule of Supplemental Consolidated Balance Sheet Information) (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Sep. 27, 2020 |
Supplemental Consolidated Financial Statement Information [Abstract] | ||
Trade | $ 75,273 | $ 77,082 |
Notes receivable, current portion | 1,467 | 1,193 |
Income tax receivable | 1,157 | 1,591 |
Other | 2,730 | 4,092 |
Allowance for doubtful accounts | (6,292) | (5,541) |
Accounts and other receivables, net | 74,335 | 78,417 |
Company-owned life insurance policies | 123,566 | 113,767 |
Deferred rent receivable | 46,234 | 48,604 |
Franchise tenant improvement allowances | 34,124 | 29,437 |
Notes receivable, less current portion | 4,544 | 1,851 |
Other | 15,970 | 16,964 |
Other assets, net | 224,438 | 210,623 |
Payroll and related taxes | 34,649 | 34,475 |
Sales and property taxes | 23,174 | 22,038 |
Insurance | 21,218 | 25,310 |
Deferred rent income | 17,892 | 1,687 |
Accrued advertising costs | 13,097 | 9,861 |
Deferred franchise fees | 4,824 | 4,934 |
Other | 33,563 | 31,126 |
Accrued liabilities | 148,417 | 129,431 |
Defined benefit pension plans | 70,354 | 120,811 |
Deferred franchise fees | 35,608 | 38,607 |
Other | 50,380 | 47,076 |
Other long-term liabilities | $ 156,342 | $ 206,494 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Nov. 19, 2021 | Oct. 03, 2021 | Jul. 04, 2021 | Apr. 11, 2021 | Jan. 17, 2021 | Oct. 03, 2021 | Sep. 27, 2020 | Sep. 29, 2019 |
Subsequent Event [Line Items] | ||||||||
Cash dividends declared per common share (in usd per share) | $ 0.44 | $ 0.44 | $ 0.40 | $ 0.40 | $ 1.68 | $ 1.20 | $ 1.60 | |
Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Cash dividends declared per common share (in usd per share) | $ 0.44 | |||||||
Stock buy-back program, authorized amount | $ 200,000,000 |