Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 26, 2021 | Oct. 29, 2021 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 26, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Transition Report | false | |
Entity File Number | 0-21660 | |
Entity Registrant Name | PAPA JOHNS INTERNATIONAL INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 61-1203323 | |
Entity Address, Address Line One | 2002 Papa John’s Boulevard | |
Entity Address, City or Town | Louisville | |
Entity Address, State or Province | KY | |
Entity Address, Postal Zip Code | 40299-2367 | |
City Area Code | 502 | |
Local Phone Number | 261-7272 | |
Title of 12(b) Security | Common stock, $0.01 par value | |
Trading Symbol | PZZA | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 36,363,904 | |
Entity Central Index Key | 0000901491 | |
Current Fiscal Year End Date | --12-26 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 26, 2021 | Dec. 27, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 105,813 | $ 130,204 |
Accounts receivable, net | 79,534 | 90,135 |
Notes receivable, current portion | 13,075 | 11,318 |
Income tax receivable | 599 | 1,273 |
Inventories | 33,490 | 30,265 |
Prepaid expenses and other current assets | 39,249 | 43,212 |
Total current assets | 271,760 | 306,407 |
Property and equipment, net | 209,072 | 200,895 |
Finance lease right-of-use assets, net | 21,917 | 16,840 |
Operating lease right-of-use assets | 174,119 | 148,110 |
Notes receivable, less current portion, net | 37,263 | 36,538 |
Goodwill | 80,906 | 80,791 |
Deferred income taxes | 13,926 | 10,800 |
Other assets | 80,991 | 72,389 |
Total assets | 889,954 | 872,770 |
Current liabilities: | ||
Accounts payable | 42,384 | 37,370 |
Income and other taxes payable | 26,221 | 10,263 |
Accrued expenses and other current liabilities | 201,528 | 174,563 |
Current deferred revenue | 20,617 | 19,590 |
Current finance lease liabilities | 4,914 | 3,545 |
Current operating lease liabilities | 22,455 | 23,538 |
Current portion of long-term debt | 20,000 | |
Total current liabilities | 318,119 | 288,869 |
Deferred revenue | 12,471 | 13,664 |
Long-term finance lease liabilities | 17,555 | 13,531 |
Long-term operating lease liabilities | 157,359 | 124,666 |
Long-term debt, less current portion, net | 414,915 | 328,292 |
Deferred income taxes | 178 | 948 |
Other long-term liabilities | 98,872 | 111,364 |
Total liabilities | 1,019,469 | 881,334 |
Series B Convertible Preferred Stock; $0.01 par value; no shares authorized, issued or outstanding at September 26, 2021, compared to 260.0 shares authorized, 252.5 shares issued and outstanding at December 27, 2020 | 251,901 | |
Redeemable noncontrolling interests | 7,531 | 6,474 |
Stockholders' deficit: | ||
Common stock ($0.01 par value per share; issued 48,989 at September 26, 2021 and 45,288 at December 27, 2020) | 490 | 453 |
Additional paid-in capital | 440,742 | 254,103 |
Accumulated other comprehensive loss | (9,910) | (14,168) |
Retained earnings | 171,378 | 219,158 |
Treasury stock (12,806 shares at September 26, 2021 and 12,743 shares at December 27, 2020, at cost) | (755,035) | (741,724) |
Total stockholders' deficit | (152,335) | (282,178) |
Noncontrolling interests in subsidiaries | 15,289 | 15,239 |
Total Stockholders' deficit | (137,046) | (266,939) |
Total liabilities, Series B Convertible Preferred Stock, Redeemable noncontrolling interests and Stockholders' deficit | $ 889,954 | $ 872,770 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 26, 2021 | Dec. 27, 2020 |
Condensed Consolidated Balance Sheets | ||
Series B Convertible Preferred Stock, par value | $ 0.01 | $ 0.01 |
Series B Convertible Preferred Stock, shares authorized | 0 | 260,000 |
Series B Convertible Preferred Stock, shares issued | 0 | 252,500 |
Series B Convertible Preferred Stock, shares outstanding | 0 | 252,500 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares issued | 48,989,000 | 45,288,000 |
Treasury stock, shares | 12,806,000 | 12,743,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | |
Revenues: | ||||
Total revenues | $ 512,782 | $ 472,941 | $ 1,539,536 | $ 1,343,423 |
Costs and expenses: | ||||
General and administrative expenses | 54,070 | 52,601 | 157,779 | 148,680 |
Depreciation and amortization | 11,477 | 12,764 | 36,830 | 37,436 |
Total costs and expenses | 474,205 | 448,392 | 1,409,460 | 1,272,868 |
Operating income | 38,577 | 24,549 | 130,076 | 70,555 |
Net interest expense | (3,979) | (3,636) | (11,275) | (11,230) |
Income before income taxes | 34,598 | 20,913 | 118,801 | 59,325 |
Income tax expense | 4,057 | 4,516 | 19,387 | 11,984 |
Net income before attribution to noncontrolling interests | 30,541 | 16,397 | 99,414 | 47,341 |
Net income attributable to noncontrolling interests | (1,285) | (689) | (4,021) | (2,576) |
Net income attributable to the Company | 29,256 | 15,708 | 95,393 | 44,765 |
Calculation of net income (loss) for earnings per share: | ||||
Net income attributable to the Company | 29,256 | 15,708 | 95,393 | 44,765 |
Dividends on redemption of Series B Convertible Preferred Stock | (109,852) | |||
Dividends paid to participating securities | (137) | (3,548) | (5,964) | (10,546) |
Net income attributable to participating securities | (158) | (703) | (1,809) | |
Net income (loss) attributable to common shareholders | $ 28,961 | $ 11,457 | $ (20,423) | $ 32,410 |
Basic earnings (loss) per common share | $ 0.80 | $ 0.35 | $ (0.59) | $ 1 |
Diluted earnings (loss) per common share | $ 0.79 | $ 0.35 | $ (0.59) | $ 0.99 |
Basic weighted average common shares outstanding | 36,387 | 32,616 | 34,619 | 32,347 |
Diluted weighted average common shares outstanding | 36,719 | 32,971 | 34,619 | 32,643 |
Dividends declared per common share | $ 0.350 | $ 0.225 | $ 0.800 | $ 0.675 |
Domestic Company-owned restaurants | ||||
Revenues: | ||||
Total revenues | $ 191,584 | $ 178,371 | $ 584,942 | $ 526,317 |
Costs and expenses: | ||||
Operating costs (excluding depreciation and amortization shown separately below): | 155,477 | 144,803 | 465,658 | 419,082 |
North America franchising | ||||
Revenues: | ||||
Total revenues | 31,933 | 25,281 | 97,123 | 68,895 |
North America commissary | ||||
Revenues: | ||||
Total revenues | 189,224 | 181,338 | 560,743 | 504,379 |
Costs and expenses: | ||||
Operating costs (excluding depreciation and amortization shown separately below): | 175,399 | 167,937 | 518,310 | 466,676 |
International | ||||
Revenues: | ||||
Total revenues | 38,408 | 33,440 | 110,629 | 87,592 |
Costs and expenses: | ||||
Operating costs (excluding depreciation and amortization shown separately below): | 21,743 | 19,370 | 62,791 | 52,775 |
Other segment | ||||
Revenues: | ||||
Total revenues | 61,633 | 54,511 | 186,099 | 156,240 |
Costs and expenses: | ||||
Operating costs (excluding depreciation and amortization shown separately below): | $ 56,039 | $ 50,917 | $ 168,092 | $ 148,219 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | |
Condensed Consolidated Statements of Comprehensive Income | ||||
Net income before attribution to noncontrolling interests | $ 30,541 | $ 16,397 | $ 99,414 | $ 47,341 |
Other comprehensive income (loss), before tax: | ||||
Foreign currency translation adjustments | (1,113) | 1,721 | 383 | (1,438) |
Interest rate swaps | 1,535 | 5,147 | ||
Interest rate swaps | 1,647 | (9,375) | ||
Other comprehensive income (loss), before tax | 422 | 3,368 | 5,530 | (10,813) |
Income tax effect: | ||||
Foreign currency translation adjustments | 256 | (395) | (88) | 332 |
Interest rate swaps | (353) | (1,184) | ||
Interest rate swaps | (379) | 2,156 | ||
Income tax effect | (97) | (774) | (1,272) | 2,488 |
Other comprehensive income (loss), net of tax | 325 | 2,594 | 4,258 | (8,325) |
Comprehensive income before attribution to noncontrolling interests | 30,866 | 18,991 | 103,672 | 39,016 |
Less: comprehensive (income), redeemable noncontrolling interests | (692) | (301) | (2,192) | (1,184) |
Less: comprehensive (income), nonredeemable noncontrolling interests | (593) | (388) | (1,829) | (1,392) |
Comprehensive income attributable to the Company | $ 29,581 | $ 18,302 | $ 99,651 | $ 36,440 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | |
Consolidated Statements of Comprehensive Income (Unaudited) | ||||
Income tax expense (benefit) | $ 4,057 | $ 4,516 | $ 19,387 | $ 11,984 |
Net interest expense | (3,979) | (3,636) | (11,275) | (11,230) |
Interest rate swap | Amount reclassified from AOCL | ||||
Consolidated Statements of Comprehensive Income (Unaudited) | ||||
Income tax expense (benefit) | 368 | 1,139 | ||
Net interest expense | (1,644) | (5,084) | ||
Interest expense | Interest rate swap | ||||
Consolidated Statements of Comprehensive Income (Unaudited) | ||||
Amount of Gain or (Loss) Reclassified from AOCI/AOCL into Income | (1,644) | (1,674) | (5,084) | (3,376) |
Net interest expense | $ 3,979 | 3,636 | $ 11,275 | 11,230 |
Qualifying as hedges | Interest rate swap | Amount reclassified from AOCL | ||||
Consolidated Statements of Comprehensive Income (Unaudited) | ||||
Income tax expense (benefit) | 378 | 763 | ||
Net interest expense | $ (1,674) | $ (3,376) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Deficit - USD ($) shares in Thousands, $ in Thousands | AdjustmentRetained Earnings | Adjustment | Adjusted BalanceCommon Stock | Adjusted BalanceAdditional Paid-In Capital | Adjusted BalanceAccumulated Other Comprehensive Income (Loss) | Adjusted BalanceRetained Earnings | Adjusted BalanceTreasury Stock | Adjusted BalanceNoncontrolling Interests in Subsidiaries | Adjusted Balance | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Treasury Stock | Noncontrolling Interests in Subsidiaries | Total |
Balance (ASU 2016-13) at Dec. 29, 2019 | $ (1,066) | $ (1,066) | $ 447 | $ 219,047 | $ (10,185) | $ 204,631 | $ (747,327) | $ 15,665 | $ (317,722) | |||||||
Balance at Dec. 29, 2019 | $ 447 | $ 219,047 | $ (10,185) | $ 205,697 | $ (747,327) | $ 15,665 | $ (316,656) | |||||||||
Balance (in shares) (ASU 2016-13) at Dec. 29, 2019 | 31,894 | |||||||||||||||
Balance (in shares) at Dec. 29, 2019 | 31,894 | |||||||||||||||
Net income | 44,765 | 1,392 | 46,157 | |||||||||||||
Other comprehensive income (loss), net of tax | (8,325) | (8,325) | ||||||||||||||
Cash dividends on common stock | 210 | (22,066) | (21,856) | |||||||||||||
Cash dividends on preferred stock | (10,237) | (10,237) | ||||||||||||||
Exercise of stock options | $ 5 | 29,199 | 29,204 | |||||||||||||
Exercise of stock options (in shares) | 505 | |||||||||||||||
Stock-based compensation expense | 13,071 | 13,071 | ||||||||||||||
Issuance of restricted stock | (4,573) | 4,573 | ||||||||||||||
Issuance of restricted stock (in shares) | 79 | |||||||||||||||
Tax effect of restricted stock awards | (1,665) | (1,665) | ||||||||||||||
Distributions to noncontrolling interests | (1,642) | (1,642) | ||||||||||||||
Other | (79) | (182) | 431 | 170 | ||||||||||||
Other (in shares) | 7 | |||||||||||||||
Balance at Sep. 27, 2020 | $ 452 | 255,210 | (18,510) | 216,911 | (742,323) | 15,415 | (272,845) | |||||||||
Balance (in shares) at Sep. 27, 2020 | 32,485 | |||||||||||||||
Balance at Jun. 28, 2020 | $ 451 | 243,577 | (21,104) | 212,104 | (742,600) | 15,724 | (291,848) | |||||||||
Balance (in shares) at Jun. 28, 2020 | 32,349 | |||||||||||||||
Net income | 15,708 | 388 | 16,096 | |||||||||||||
Other comprehensive income (loss), net of tax | 2,594 | 2,594 | ||||||||||||||
Cash dividends on common stock | 78 | (7,414) | (7,336) | |||||||||||||
Cash dividends on preferred stock | (3,412) | (3,412) | ||||||||||||||
Exercise of stock options | $ 1 | 7,499 | 7,500 | |||||||||||||
Exercise of stock options (in shares) | 131 | |||||||||||||||
Stock-based compensation expense | 4,328 | 4,328 | ||||||||||||||
Issuance of restricted stock | (105) | 105 | ||||||||||||||
Issuance of restricted stock (in shares) | 2 | |||||||||||||||
Tax effect of restricted stock awards | (86) | (86) | ||||||||||||||
Distributions to noncontrolling interests | (697) | (697) | ||||||||||||||
Other | (81) | (75) | 172 | 16 | ||||||||||||
Other (in shares) | 3 | |||||||||||||||
Balance at Sep. 27, 2020 | $ 452 | 255,210 | (18,510) | 216,911 | (742,323) | 15,415 | (272,845) | |||||||||
Balance (in shares) at Sep. 27, 2020 | 32,485 | |||||||||||||||
Balance at Dec. 27, 2020 | $ 453 | 254,103 | (14,168) | 219,158 | (741,724) | 15,239 | (266,939) | |||||||||
Balance (in shares) at Dec. 27, 2020 | 32,545 | |||||||||||||||
Net income | 95,393 | 1,829 | 97,222 | |||||||||||||
Other comprehensive income (loss), net of tax | 4,258 | 4,258 | ||||||||||||||
Repurchase and conversion of Series B Convertible Preferred Stock | $ 35 | 174,631 | (110,498) | 64,168 | ||||||||||||
Repurchase and conversion of Series B Convertible Preferred Stock (in shares) | 3,489 | |||||||||||||||
Cash dividends on common stock | 110 | (27,750) | (27,640) | |||||||||||||
Cash dividends on preferred stock | (4,121) | (4,121) | ||||||||||||||
Exercise of stock options | $ 2 | 11,209 | 11,211 | |||||||||||||
Exercise of stock options (in shares) | 199 | |||||||||||||||
Acquisition of Company common stock | (20,555) | (20,555) | ||||||||||||||
Acquisition of Company common stock (in shares) | (187) | |||||||||||||||
Stock-based compensation expense | 12,519 | 12,519 | ||||||||||||||
Issuance of restricted stock | (6,538) | 6,538 | ||||||||||||||
Issuance of restricted stock (in shares) | 125 | |||||||||||||||
Tax effect of restricted stock awards | (5,310) | (5,310) | ||||||||||||||
Distributions to noncontrolling interests | (1,779) | (1,779) | ||||||||||||||
Other | 18 | (804) | 706 | (80) | ||||||||||||
Other (in shares) | 12 | |||||||||||||||
Balance at Sep. 26, 2021 | $ 490 | 440,742 | (9,910) | 171,378 | (755,035) | 15,289 | (137,046) | |||||||||
Balance (in shares) at Sep. 26, 2021 | 36,183 | |||||||||||||||
Balance at Jun. 27, 2021 | $ 489 | 435,608 | (10,235) | 154,769 | (743,819) | 15,290 | (147,898) | |||||||||
Balance (in shares) at Jun. 27, 2021 | 36,215 | |||||||||||||||
Net income | 29,256 | 593 | 29,849 | |||||||||||||
Other comprehensive income (loss), net of tax | 325 | 325 | ||||||||||||||
Cash dividends on common stock | 48 | (12,845) | (12,797) | |||||||||||||
Exercise of stock options | $ 1 | 3,111 | 3,112 | |||||||||||||
Exercise of stock options (in shares) | 51 | |||||||||||||||
Acquisition of Company common stock | (12,367) | (12,367) | ||||||||||||||
Acquisition of Company common stock (in shares) | (103) | |||||||||||||||
Stock-based compensation expense | 4,317 | 4,317 | ||||||||||||||
Issuance of restricted stock | (873) | 873 | ||||||||||||||
Issuance of restricted stock (in shares) | 15 | |||||||||||||||
Tax effect of restricted stock awards | (1,423) | (1,423) | ||||||||||||||
Distributions to noncontrolling interests | (594) | (594) | ||||||||||||||
Other | (46) | 198 | 278 | 430 | ||||||||||||
Other (in shares) | 5 | |||||||||||||||
Balance at Sep. 26, 2021 | $ 490 | $ 440,742 | $ (9,910) | $ 171,378 | $ (755,035) | $ 15,289 | $ (137,046) | |||||||||
Balance (in shares) at Sep. 26, 2021 | 36,183 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Stockholders' Deficit (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | |
Accumulated other comprehensive income (loss) | $ (9,910) | $ (18,510) | $ (9,910) | $ (18,510) |
Unrealized foreign currency translation gains (losses) | (3,499) | (6,705) | (3,499) | (6,705) |
Net unrealized gain (loss) on the interest rate swap agreements | (6,411) | (11,805) | (6,411) | (11,805) |
Joint ventures | ||||
Net income (loss) allocated to the redeemable noncontrolling interest from joint venture arrangements | $ 692 | $ 301 | $ 2,192 | $ 1,184 |
Condensed Consolidated Statem_6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2021 | Sep. 27, 2020 | |
Operating activities | ||
Net income before attribution to noncontrolling interests | $ 99,414 | $ 47,341 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Benefit for allowance for credit losses on accounts and notes receivable | (920) | (334) |
Depreciation and amortization | 36,830 | 37,436 |
Deferred income taxes | (5,113) | (4,696) |
Stock-based compensation expense | 12,519 | 13,071 |
Other | 1,052 | 1,233 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Accounts receivable | 5,955 | (4,378) |
Income tax receivable | 674 | 3,131 |
Inventories | (3,217) | (1,173) |
Prepaid expenses and other current assets | 11,277 | 14,393 |
Other assets and liabilities | (8,627) | 18,080 |
Accounts payable | 5,014 | 3,147 |
Income and other taxes payable | 15,958 | 2,435 |
Accrued expenses and other current liabilities | 24,001 | 40,112 |
Deferred revenue | (1,193) | (1,251) |
Net cash provided by operating activities | 193,624 | 168,547 |
Investing activities | ||
Purchases of property and equipment | (41,328) | (24,269) |
Notes issued | (14,637) | (13,240) |
Repayments of notes issued | 15,352 | 8,906 |
Acquisitions, net of cash acquired | (699) | |
Other | 121 | 15 |
Net cash used in investing activities | (41,191) | (28,588) |
Financing activities | ||
Proceeds from issuance of senior notes | 400,000 | |
Repayments of term loan | (340,000) | (15,000) |
Net proceeds (repayments) of revolving credit facilities | 15,000 | (5,000) |
Debt issuance costs | (9,179) | |
Proceeds from exercise of stock options | 11,211 | 29,204 |
Dividends paid to common stockholders | (27,640) | (21,856) |
Dividends paid to preferred stockholders | (6,394) | (10,237) |
Tax payments for equity award issuances | (5,310) | (1,665) |
Repurchase of Series B Convertible Preferred Stock | (188,647) | |
Acquisition of Company common stock | (20,555) | |
Distributions to noncontrolling interests | (2,914) | (1,778) |
Other | (2,630) | (1,105) |
Net cash used in financing activities | (177,058) | (27,437) |
Effect of exchange rate changes on cash and cash equivalents | 234 | (383) |
Change in cash and cash equivalents | (24,391) | 112,139 |
Cash and cash equivalents at beginning of period | 130,204 | 27,911 |
Cash and cash equivalents at end of period | $ 105,813 | $ 140,050 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 26, 2021 | |
Basis of Presentation | |
Basis of Presentation | 1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete annual financial statements. In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 26, 2021 are not necessarily indicative of the results that may be expected for the fiscal year ending December 26, 2021. For further information, refer to the consolidated financial statements and footnotes thereto included in the Annual Report on Form 10-K for Papa John’s International, Inc. (referred to as the “Company”, “Papa John’s” or in the first-person notations of “we”, “us” and “our”) for the year ended December 27, 2020. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 26, 2021 | |
Significant Accounting Policies | |
Significant Accounting Policies | 2. Significant Accounting Policies Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Significant items that are subject to such estimates and assumptions include allowance for credit losses on accounts and notes receivable, intangible assets, contract assets and contract liabilities, including the online customer loyalty program obligation and gift card breakage, right-of-use assets and lease liabilities, insurance reserves and tax reserves. Although management bases its estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, actual results could significantly differ from these estimates. Variable Interest Entity Papa John’s domestic restaurants, both Company-owned and franchised, participate in Papa John’s Marketing Fund, Inc. (“PJMF”), a nonstock corporation designed to operate at break-even as it spends all annual contributions received from the system. PJMF collects a percentage of revenues from Company-owned and franchised restaurants in the United States for the purpose of designing and administering advertising and promotional programs. PJMF is a variable interest entity (“VIE”) that funds its operations with ongoing financial support and contributions from the domestic restaurants, of which approximately 80% are franchised, and does not have sufficient equity to fund its operations without these ongoing financial contributions. Based on an assessment of the governance structure and operating procedures of PJMF, the Company determined it has the power to control certain significant activities of PJMF, and therefore, is the primary beneficiary. The Company has consolidated PJMF in its financial results in accordance with Accounting Standards Codification (“ASC”) 810, “Consolidations.” Noncontrolling Interests Papa John’s has four joint venture arrangements in which there are noncontrolling interests held by third parties that include 188 and 192 restaurants at September 26, 2021 and September 27, 2020, respectively. Consolidated net income is required to be reported separately at amounts attributable to both the Company and the noncontrolling interests. Additionally, disclosures are required to clearly identify and distinguish between the interests of the Company and the interests of the noncontrolling owners, including a disclosure on the face of the Condensed Consolidated Statements of Operations of net income attributable to noncontrolling interests. Net income attributable to these joint ventures for the three and nine months ended September 26, 2021 and September 27, 2020 was as follows (in thousands): Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2021 2020 2021 2020 Papa John’s International, Inc. $ 2,171 $ 1,292 $ 6,816 $ 4,743 Noncontrolling interests 1,285 689 4,021 2,576 Total net income $ 3,456 $ 1,981 $ 10,837 $ 7,319 The following summarizes the redemption feature, location and related accounting within the Condensed Consolidated Balance Sheets for these joint venture arrangements: Type of Joint Venture Arrangement Location within the Balance Sheets Recorded Value Joint ventures with no redemption feature Permanent equity Carrying value Joint ventures with option to require the Company to purchase the noncontrolling interest - not currently redeemable or redemption not probable Temporary equity Carrying value Deferred Income Tax Accounts and Tax Reserves We are subject to income taxes in the United States and several foreign jurisdictions. Significant judgment is required in determining Papa John’s provision for income taxes and the related assets and liabilities. The provision for income taxes includes income taxes paid, currently payable or receivable and those deferred. We use an estimated annual effective rate based on expected annual income to determine our quarterly provision for income taxes. The effective income tax rate includes the estimated domestic state effective income tax rate and applicable foreign income tax rates. The effective income tax rate is also impacted by various permanent items and credits, net of any related valuation allowances, and can vary based on changes in estimated annual income. Discrete items are recorded in the quarter in which they occur. Deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities and are measured using enacted tax rates and laws that are expected to be in effect when the differences reverse. Deferred tax assets are also recognized for the estimated future effects of tax attribute carryforwards (e.g., net operating losses, capital losses, and foreign tax credits). The effect on deferred taxes of changes in tax rates is recognized in the period in which the new tax rate is enacted. Valuation allowances are established when necessary on a jurisdictional basis to reduce deferred tax assets to the amounts we expect to realize. Tax authorities periodically audit the Company. We record reserves and related interest and penalties for identified exposures as income tax expense. We evaluate these issues on a quarterly basis to adjust for events, such as statute of limitations expirations, court or state rulings or audit settlements, which may impact our ultimate payment for such exposures. Fair Value Measurements and Disclosures The Company determines the fair value of financial assets and liabilities based on the price that would be received to sell the asset or paid to transfer the liability to a market participant. Certain assets and liabilities are measured at fair value on a recurring basis and are required to be classified and disclosed in one of the following three categories: ● Level 1: Quoted market prices in active markets for identical assets or liabilities. ● Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. ● Level 3: Unobservable inputs that are not corroborated by market data. Fair value is a market-based measurement, not an entity-specific measurement. Considerable judgment is required to interpret market data to estimate fair value; accordingly, the fair values presented do not necessarily indicate what the Company or its debtholders could realize in a current market exchange. Our financial assets and liabilities that were measured at fair value on a recurring basis as of September 26, 2021 and December 27, 2020 are as follows: Carrying Fair Value Measurements (in thousands) Value Level 1 Level 2 Level 3 September 26, 2021 Financial assets: Cash surrender value of life insurance policies (a) $ 40,482 $ 40,482 $ — $ — Financial liabilities: Interest rate swaps (b) 8,162 — 8,162 — December 27, 2020 Financial assets: Cash surrender value of life insurance policies (a) $ 37,578 $ 37,578 $ — $ — Financial liabilities: Interest rate swaps (b) 13,452 — 13,452 — (a) Represents life insurance policies held in our non-qualified deferred compensation plan. (b) The fair value of our interest rate swaps is based on the sum of all future net present value cash flows. The future cash flows are derived based on the terms of our interest rate swaps, as well as considering published discount factors, and projected London Interbank Offered Rates (“LIBOR”). The fair value of certain assets and liabilities approximates carrying value because of the short-term nature of the accounts, including cash and cash equivalents, accounts receivable, net of allowances, and accounts payable. The carrying value of notes receivable, net of allowances, also approximates fair value. The Company’s revolving credit facilities and term debt under the Previous Credit Facility approximate carrying value due to their variable market-based interest rate. The Company’s 3.875% senior notes are classified as a Level 2 fair value measurement since the Company estimates the fair value by using recent trading transactions, and have the following estimated fair values and carrying values (excluding the impact of unamortized debt issuance costs) as of September 26, 2021 and December 27, 2020, respectively: September 26, 2021 December 27, 2020 Carrying Fair Carrying Fair (in thousands) Value Value Value Value 3.875% Senior Notes $ 400,000 $ 401,000 $ — $ — Allowance for Credit Losses Estimates of expected credit losses, even if remote, are based upon historical account write-off trends, facts about the current financial condition of the debtor, forecasts of future operating results based upon current trends of select operating metrics, and macroeconomic factors. Credit quality is monitored through the timing of payments compared to the prescribed payment terms and known facts regarding the financial condition of the franchisee or customer. Account and note balances are charged off against the allowance after recovery efforts have ceased. The following table summarizes changes in our allowances for credit losses for accounts receivable and notes receivable: (in thousands) Accounts Receivable Notes Receivable Balance at December 27, 2020 $ 3,622 $ 3,211 Current period benefit for expected credit losses (80) (563) Write-offs charged against the allowance (1,212) (843) Recoveries collected — (277) Balance at September 26, 2021 $ 2,330 $ 1,528 |
Leases
Leases | 9 Months Ended |
Sep. 26, 2021 | |
Leases | |
Leases | 3. Leases Lessor Operating Leases We sublease certain retail space to our franchisees in the United Kingdom which are primarily operating leases. At September 26, 2021, we leased and subleased approximately 410 Papa John’s restaurants to franchisees in the United Kingdom. The initial lease terms on the franchised sites in the United Kingdom are generally 15 years. The Company has the option to negotiate an extension toward the end of the lease term at the landlord’s discretion. Rental income, primarily derived from properties leased and subleased to franchisees in the United Kingdom, is recognized on a straight-line basis over the respective operating lease terms. We recognized total sublease income of $9.0 million and $7.6 million within Other revenues in the Condensed Consolidated Statements of Operations for the nine months ended September 26, 2021 and September 27, 2020, respectively. Lease Guarantees As a result of assigning our interest in obligations under property leases as a condition of the refranchising of certain restaurants, we are contingently liable for payment of 71 domestic leases. These leases have varying terms, the latest of which expires in 2036. As of September 26, 2021, the estimated maximum amount of undiscounted payments the Company could be required to make in the event of nonpayment by the primary lessees was $12.1 million. This contingent liability is not included in the Condensed Consolidated Balance Sheet as it is not probable to occur. The fair value of the guarantee is not material. Supplemental Cash Flow & Other Information Supplemental cash flow information related to leases for the periods reported is as follows: Nine Months Ended (in thousands) September 26, 2021 September 27, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 864 $ 435 Financing cash flows from finance leases 3,358 1,438 Operating cash flows from operating leases (a) 28,830 27,965 Right-of-use assets obtained in exchange for new finance lease liabilities 9,190 1,056 Right-of-use assets obtained in exchange for new operating lease liabilities (b) 52,462 18,421 Cash received from sublease income 8,728 7,641 (a) Included within the change in Other assets and liabilities within the Condensed Consolidated Statements of Cash Flows offset by non-cash operating lease right-of-use asset amortization and lease liability accretion. (b) Includes right-of-use assets of approximately |
Papa John's Marketing Fund, Inc
Papa John's Marketing Fund, Inc. | 9 Months Ended |
Sep. 26, 2021 | |
Papa John's Marketing Fund, Inc. | |
Papa John's Marketing Fund, Inc. | 4. Papa John’s Marketing Fund, Inc. PJMF collects a percentage of revenues from Company-owned and franchised restaurants in the United States, for the purpose of designing and administering advertising and promotional programs for all participating domestic restaurants. Contributions and expenditures are reported on a gross basis in the Condensed Consolidated Statements of Operations within Other revenues and Other expenses. Assets and liabilities of PJMF, which are restricted in their use, included in the Condensed Consolidated Balance Sheets were as follows (in thousands): September 26, December 27, 2021 2020 Assets Current assets: Cash and cash equivalents $ 32,629 $ 9,394 Accounts receivable, net 13,078 23,711 Income tax receivable 191 192 Prepaid expenses and other current assets 1,802 1,914 Total current assets 47,700 35,211 Deferred income taxes 595 588 Total assets $ 48,295 $ 35,799 Liabilities Current liabilities: Accounts payable $ 9,810 $ 5,429 Income and other taxes payable 2 2 Accrued expenses and other current liabilities 39,663 32,578 Current deferred revenue 3,235 3,938 Total current liabilities 52,710 41,947 Deferred revenue 1,881 2,419 Total liabilities $ 54,591 $ 44,366 |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 26, 2021 | |
Revenue Recognition | |
Revenue Recognition | 5. Revenue Recognition Contract Balances Our contract liabilities primarily relate to franchise fees, unredeemed gift card liabilities, and loyalty program obligations, which we classify as Deferred revenue on the Condensed Consolidated Balance Sheets. During the three and nine months ended September 26, 2021, the Company recognized $9.2 million and $27.3 million in revenue, respectively, related to deferred revenue, compared to $8.4 million and $24.7 million for the three and nine months ended September 27, 2020. The following table includes a breakout of contract liability balances (in thousands): Contract Liabilities September 26, 2021 December 27, 2020 Change Franchise fees and unredeemed gift card liabilities $ 17,949 $ 19,890 $ (1,941) Customer loyalty program obligations 15,139 13,364 1,775 Total contract liabilities $ 33,088 $ 33,254 $ (166) Our contract assets consist primarily of equipment incentives provided to franchisees. Equipment incentives are related to the future value of commissary revenue the Company will receive over the term of the incentive agreement. As of September 26, 2021 and December 27, 2020, the contract assets were approximately $5.6 million and $5.1 million, respectively. For the three and nine months ended September 26, 2021, revenue was reduced approximately $0.8 million and $2.2 million, respectively, for the amortization of contract assets over the applicable contract terms. Contract assets are included in Prepaid expenses and other current assets and Other assets on the Condensed Consolidated Balance Sheets. Transaction Price Allocated to the Remaining Performance Obligations The following table (in thousands) includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied at the end of the reporting period. Performance Obligations by Period Less than 1 Year 1-2 Years 2-3 Years 3-4 Years 4-5 Years Thereafter Total Franchise fees $ 2,242 $ 2,003 $ 1,766 $ 1,550 $ 1,294 $ 2,477 $ 11,332 Approximately $1.5 million of area development fees related to unopened stores and international unearned royalties are included in Deferred revenue. Timing of revenue recognition is dependent upon the timing of store openings and franchisees’ revenues. Gift card liabilities of approximately $5.1 million, included in Deferred revenue, will be recognized in Company-owned restaurant revenues when gift cards are redeemed. The Company will recognize redemption fee revenue in Other revenues when cards are redeemed at franchised restaurant locations. The Company applies the practical expedient in ASC 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less. |
Common Stock and Series B Conve
Common Stock and Series B Convertible Preferred Stock | 9 Months Ended |
Sep. 26, 2021 | |
Common Stock and Series B Convertible Preferred Stock | |
Common Stock and Series B Convertible Preferred Stock | 6. Common Stock and Series B Convertible Preferred Stock Shares Authorized and Outstanding The Company has authorized 5.0 million shares of preferred stock (of which none were issued or outstanding at September 26, 2021 and December 27, 2020, respectively) and 100.0 million shares of common stock as of September 26, 2021 and December 27, 2020, respectively. There were 36.2 million shares of the Company’s common stock outstanding at September 26, 2021 compared to 32.5 million shares at December 27, 2020. During the second quarter of 2021, the Company entered into a Share Repurchase Agreement with certain funds affiliated with, or managed by, Starboard Value LP (collectively, “Starboard”), pursuant to which (i) the Company repurchased from Starboard 78,387 shares of the Series B Convertible Preferred Stock, par value $0.01 per share, of the Company (“Series B Preferred Stock”) and (ii) Starboard converted the remaining 171,613 shares of Series B Preferred Stock that it owned into 3,458,360 shares of the Company’s common stock pursuant to the terms of the Certificate of Designation of the Series B Preferred Stock. Additionally, the Company entered into agreements with certain franchisee investors to repurchase 1,000 shares of the outstanding Series B Preferred Stock and convert the remaining 1,530 shares of Series B Preferred Stock into 30,769 shares of common stock. The Company paid Starboard and the franchisee investors aggregate one-time cash payments of $188.6 million for the repurchase and conversion of all of the outstanding shares of Series B Preferred Stock. The excess of the cash payment over the carrying value of the respective Series B Preferred Stock redeemed resulted in $109.9 million of dividends on redemption of Series B Convertible Preferred Stock in the Condensed Consolidated Statement of Operations, which reduced net income attributable to common stockholders during the second quarter of 2021. Diluted earnings per share for the nine months ended September 26, 2021 was reduced by $3.14 as a result of this transaction. On August 3, 2021, the Company filed a Certificate of Elimination (the “Certificate of Elimination”) with the Secretary of State of the State of Delaware to eliminate the Series B Preferred Stock. No shares of Series B Preferred Stock were issued or outstanding following the repurchase and conversion thereof in the second quarter of 2021. Effective upon filing, the Certificate of Elimination eliminated from the Company’s Amended and Restated Certificate of Incorporation all matters set forth in the Certificate of Designation with respect to the Series B Preferred Stock. The shares that were designated to such series were returned to the status of authorized but unissued shares of preferred stock, par value $0.01 per share, of the Company, without designation as to series. Share Repurchase Program Our Board of Directors has authorized the repurchase of up to $75.0 million of common stock under a share repurchase program that began on November 4, 2020 and is effective through December 26, 2021. Through September 26, 2021, a total of approximately 219,000 shares with an aggregate cost of $23.3 million and an average price of $106.16 per share were repurchased under this program. Funding for the share repurchase program has been provided through our operating cash flows. Subsequent to September 26, 2021, we acquired an additional 158,000 shares at an aggregate cost of $19.8 million and an average price of $125.50 per share. Approximately $31.9 million remained available under this share repurchase program as of October 29, 2021. Subsequent to the end of the third quarter, on October 28, 2021, our Board of Directors approved a new share repurchase program for up to $425.0 million of the Company’s common stock, with an indefinite duration. This represents approximately 9.4% of the Company’s currently outstanding common stock based on the closing stock price as of October 29, 2021. The new share repurchase program will initially operate alongside the Company’s existing $75.0 million share repurchase authorization, which expires on December 26, 2021. The timing and volume of share repurchases under the Company’s share repurchase programs may be executed at the discretion of management on an opportunistic basis, subject to market and business conditions, regulatory requirements and other factors, or pursuant to trading plans or other arrangements. Repurchases under the programs may be made through open market, block, and privately negotiated transactions, including Rule 10b5-1 plans, at times and in such amounts as management deems appropriate. Repurchases under the Company’s share repurchase programs may be commenced or suspended from time to time at the Company’s discretion without prior notice. Funding for the share repurchase programs will be provided through our credit facility, operating cash flow, stock option exercises and cash and cash equivalents. Dividends The Company recorded dividends of approximately $33.2 million for the nine months ended September 26, 2021 consisting of the following: ● $27.6 million paid to common stockholders ($0.80 per share); ● $3.0 million in preferred dividends on the Series B Preferred Stock (3.6% of the investment per annum); ● $1.5 million of common stock deemed dividend distributions in conjunction with the repurchase and conversion of the Series B Preferred Stock; and ● $1.1 million in common stock “pass-through” dividends paid to Series B Preferred Stockholders on an as-converted basis ($0.45 per share). On October 28, 2021, our Board of Directors declared a fourth quarter dividend of $0.35 per common share, of which approximately $12.8 million will be paid to common stockholders. The common share dividend will be paid on November 19, 2021 to stockholders of record as of the close of business on November 9, 2021. The declaration and payment of any future dividends will be at the discretion of our Board of Directors. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 26, 2021 | |
Earnings (Loss) Per Share | |
Earnings (Loss) Per Share | 7. Earnings (Loss) Per Share We compute earnings (loss) per share using the two-class method. The two-class method requires an earnings allocation formula that determines earnings (loss) per share for common shareholders and participating security holders according to dividends declared and participating rights in undistributed earnings. The shares of Series B Preferred Stock, which were repurchased by the Company or converted into shares of common stock during the second quarter of 2021, and time-based restricted stock awards are participating securities because holders of such shares have non-forfeitable dividend rights and participate in undistributed earnings with common stock. Under the two-class method, total dividends provided to the holders of participating securities and undistributed earnings allocated to participating securities, are subtracted from net income attributable to the Company in determining net income (loss) attributable to common shareholders. Additionally, any accretion to the redemption value for the Series B Preferred Stock or cash payments in excess of their respective carrying values upon redemption was treated as a deemed dividend in the two-class earnings per share calculation. The calculations of basic and diluted earnings (loss) per common share are as follows (in thousands, except per-share data): Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2021 2020 2021 2020 Basic earnings (loss) per common share Net income attributable to the Company $ 29,256 $ 15,708 $ 95,393 $ 44,765 Dividends on redemption of Series B Convertible Preferred Stock — — (109,852) — Dividends paid to participating securities (137) (3,548) (5,964) (10,546) Net income attributable to participating securities (158) (703) — (1,809) Net income (loss) attributable to common shareholders $ 28,961 $ 11,457 $ (20,423) $ 32,410 Basic weighted average common shares outstanding 36,387 32,616 34,619 32,347 Basic earnings (loss) per common share $ 0.80 $ 0.35 $ (0.59) $ 1.00 Diluted earnings (loss) per common share Net income (loss) attributable to common shareholders $ 28,961 $ 11,457 $ (20,423) $ 32,410 Weighted average common shares outstanding 36,387 32,616 34,619 32,347 Dilutive effect of outstanding equity awards (a) 332 355 — 296 Diluted weighted average common shares outstanding (b) 36,719 32,971 34,619 32,643 Diluted earnings (loss) per common share $ 0.79 $ 0.35 $ (0.59) $ 0.99 (a) Excludes 132 equity awards for the nine months ended September 27, 2020, as the effect of including such awards would have been anti-dilutive. (b) The Company had 252.5 shares of Series B Preferred Stock outstanding at September 27, 2020 (none at September 26, 2021). For the fully diluted calculation, the Series B Preferred stock dividends were added back to net income attributable to common shareholders. The Company then applied the if-converted method to calculate dilution on the Series B Preferred Stock, which resulted in 5.0 million additional common shares for September 27, 2020. This calculation was anti-dilutive for the September 27, 2020 period and as such was excluded. |
Debt
Debt | 9 Months Ended |
Sep. 26, 2021 | |
Debt | |
Debt | 8. Debt Long-term debt, net, consists of the following (in thousands): September 26, December 27, 2021 2020 Outstanding debt $ 425,000 $ 350,000 Unamortized debt issuance costs (10,085) (1,708) Current portion of long-term debt — (20,000) Total long-term debt, net $ 414,915 $ 328,292 Our outstanding debt as of September 26, 2021 was $425.0 million, which was comprised of $400.0 million outstanding under our 3.875% senior notes due 2029 (the “Notes”) and $25.0 million under the PJI Revolving Facility (as defined below). Including outstanding letters of credit, the remaining availability under the PJI Revolving Facility was approximately $572.3 million as of September 26, 2021. Senior Notes On September 14, 2021, the Company issued $400.0 million of Notes which will mature on September 15, 2029. The Notes are guaranteed by each of the Company’s existing and future domestic restricted subsidiaries that are guarantors or borrowers under the Amended Credit Agreement (as defined below) or other certain indebtedness. The Notes were offered and sold either to persons reasonably believed to be “qualified institutional buyers” pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), or to persons outside the United States under Regulation S of the Securities Act. Interest on the Notes will be payable semi-annually in cash in arrears on March 15 and September 15 of each year, commencing on March 15, 2022, at a fixed interest rate of 3.875% per annum. In connection with the Notes, the Company recorded $7.1 million of debt issuance costs, which are being amortized into net interest expense over the term of the Notes. The net proceeds from the Notes, together with borrowings under the Amended Credit Agreement (as defined below), were used to repay outstanding revolver and term loan borrowings under the Company’s Previous Credit Agreement (as defined below). The Company may redeem the Notes, in whole or in part, at any time on or after September 15, 2024 at established redemption prices ranging from 97 to 194 basis points depending on when the Notes are redeemed. At any time prior to September 15, 2024, the Company may also redeem up to 40% of the Notes with net cash proceeds of certain equity offerings at a redemption price equal to 103.875% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, excluding the redemption date. In addition, at any time prior to September 15, 2024, the Company may redeem the Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest and an applicable “make-whole” premium. The Notes also contain customary redemption provisions related to asset sales and certain change of control transactions. The Indenture governing the Notes contains customary events of default, including, among other things, payment default, failure to comply with covenants or agreements contained in the Indenture or the Notes and certain provisions related to bankruptcy events. The Indenture also contains customary negative covenants. Amended Credit Agreement Concurrently with the closing of the Notes, the Company entered into an amended and restated credit agreement (the “Amended Credit Agreement”) replacing the previous $800.0 million credit agreement (“Previous Credit Agreement”). The Amended Credit Agreement provides for a senior secured revolving credit facility in an aggregate available principal amount of $600.0 million (the “PJI Revolving Facility”), of which up to $40.0 million is available as swingline loans and up to $80.0 million is available as letters of credit. The PJI Revolving Facility will mature on September 14, 2026. In connection with the Amended Credit Agreement, the Company recorded $2.1 million of debt issuance costs, which are being amortized into net interest expense over the term of the Amended Credit Agreement. Up to $50.0 million of the PJI Revolving Facility may be advanced in certain agreed foreign currencies, including Euros, Pounds Sterling, Canadian Dollars, Japanese Yen, and Mexican Pesos. Additionally, the Amended Credit Agreement includes an accordion feature allowing for a future increase of the PJI Revolving Facility and/or incremental term loans in an aggregate amount of up to $500.0 million, subject to certain conditions, including obtaining commitments from one or more new or existing lenders to provide such increased amounts and ongoing compliance with financial covenants. Loans under the PJI Revolving Facility accrue interest at a per annum rate equal to, at the Company’s election, either a LIBOR rate plus a margin ranging from 1.25% to 2.00% or a base rate (generally determined according to the greater of a prime rate, federal funds rate plus 0.50%, or a LIBOR rate plus 1.00%) plus a margin ranging from 0.25% to 1.00%. In each case, the actual margin is determined according to a ratio of the Company’s total indebtedness to earnings before interest, taxes, depreciation, and amortization (“EBITDA”) for the then most recently ended four quarter period (the “Leverage Ratio”). An unused commitment fee ranging from 18 to 30 basis points per annum, determined according to the Leverage Ratio, applies to the unutilized commitments under the PJI Revolving Facility. Loans outstanding under the PJI Revolving Facility may be prepaid at any time without premium or penalty, subject to customary breakage costs in the case of borrowings for which a LIBOR rate election is in effect. The Amended Credit Agreement also contain provisions specifying alternative interest rate calculations to be used at such time as LIBOR ceases to be available as a benchmark for establishing the interest rate on floating interest rate borrowings. The Amended Credit Agreement contains customary affirmative and negative covenants that, among other things, require customary reporting obligations, and restrict, subject to certain exceptions, the incurrence of additional indebtedness and liens, the consummation of certain mergers, consolidations, sales of assets and similar transactions, the making of investments, equity distributions and other restricted payments, and transactions with affiliates. In addition, the Company will be subject to the following financial covenants: (1) a maximum Leverage Ratio of 5.25 to 1.00, subject to the Company’s election to increase the maximum Leverage Ratio by 0.50 to 1.00 in connection with material acquisitions if the Company satisfies certain requirements, and (2) a minimum interest coverage ratio defined as EBITDA plus consolidated rental expense to consolidated interest expense plus consolidated rental expense of 2.00 to 1.00. We were in compliance with these financial covenants at September 26, 2021. Obligations under the Amended Credit Agreement are guaranteed by certain direct and indirect material domestic subsidiaries of the Company (the “Guarantors”) and are secured by a security interest in substantially all of the capital stock and equity interests of the Company’s and the Guarantors’ domestic and first tier material foreign subsidiaries. The Amended Credit Agreement contains customary events of default including, among other things, payment defaults, breach of covenants, cross acceleration to material indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of control events. The occurrence of an event of default may result in the termination of the PJI Revolving Facility, acceleration of repayment obligations and the exercise of remedies by the Lenders with respect to the subsidiary guarantors. PJMF Revolving Facility PJMF has a $20.0 million revolving line of credit (the “PJMF Revolving Facility”) pursuant to a Revolving Loan Agreement, dated September 30, 2015 with U.S. Bank National Association, as lender. The PJMF Revolving Facility is secured by substantially all assets of PJMF. The PJMF Revolving Facility matures on September 30, 2022. The borrowings under the PJMF Revolving Facility accrue interest at a variable rate of the one-month LIBOR plus 1.75% . The applicable interest rates on the PJMF Revolving Facility were 1.9% and 2.7% for the three and nine months ended September 27, 2020, respectively. There was no debt outstanding under the PJMF Revolving Facility as of September 26, 2021 or December 27, 2020. The PJMF operating results and the related debt outstanding do not impact the financial covenants under the PJI Credit Agreement. Derivative Financial Instruments As of September 26, 2021, we have the following interest rate swap agreements with a total notional value of $350.0 million: Effective Dates Floating Rate Debt Fixed Rates April 30, 2018 through April 30, 2023 $ 55 million 2.33 % April 30, 2018 through April 30, 2023 $ 35 million 2.36 % April 30, 2018 through April 30, 2023 $ 35 million 2.34 % January 30, 2018 through August 30, 2022 $ 100 million 1.99 % January 30, 2018 through August 30, 2022 $ 75 million 1.99 % January 30, 2018 through August 30, 2022 $ 50 million 2.00 % In September 2021, we de-designated $350.0 million of our interest rate swaps as cash flow hedges following the issuance of the Notes. For these de-designated hedges, the portion of gains or losses on the derivative instruments previously recognized in accumulated other comprehensive loss (“AOCL”) will be reclassified into earnings as adjustments to interest expense on a straight-line basis over the remaining life of the originally hedged transactions. The following table provides information on the location and amounts of our swaps in the accompanying condensed consolidated financial statements (in thousands): Interest Rate Swap Derivatives Fair Value Fair Value September 26, December 27, Balance Sheet Location 2021 2020 Other current and long-term liabilities $ 8,162 $ 13,452 The effect of derivative instruments on the accompanying condensed consolidated financial statements is as follows (in thousands): Location of Gain Amount of Gain Derivatives - Amount of Gain or or (Loss) or (Loss) Total Net Interest Expense Cash Flow (Loss) Recognized Reclassified from Reclassified from on Condensed Hedging in AOCL AOCL into AOCL into Consolidated Statements Relationships on Derivative Income Income of Operations Interest rate swaps for the three months ended: September 26, 2021 $ 1,182 Interest expense $ (1,644) $ (3,979) September 27, 2020 $ 1,268 Interest expense $ (1,674) $ (3,636) Interest rate swaps for the nine months ended: September 26, 2021 $ 3,963 Interest expense $ (5,084) $ (11,275) September 27, 2020 $ (7,219) Interest expense $ (3,376) $ (11,230) Interest paid, including payments made or received under the swaps, was $4.1 million and $3.9 million for the three months ended September 26, 2021 and September 27, 2020, respectively, and $11.1 million and $12.0 million for the nine months ended September 26, 2021 and September 27, 2020, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 26, 2021 | |
Commitments and Contingencies | |
Commitments and Contingencies | 9. Commitments and Contingencies Litigation The Company is involved in a number of lawsuits, claims, investigations and proceedings, including those specifically identified below, consisting of intellectual property, employment, consumer, commercial and other matters arising in the ordinary course of business. In accordance with ASC 450, “ Contingencies Durling et al v. Papa John’s International, Inc. , |
Strategic Corporate Reorganizat
Strategic Corporate Reorganization for Long-term Growth | 9 Months Ended |
Sep. 26, 2021 | |
Strategic Corporate Reorganization for Long-term Growth | |
Strategic Corporate Reorganization for Long-term Growth | 10. Strategic Corporate Reorganization for Long-term Growth On September 17, 2020, we announced plans to open an office in Atlanta, Georgia located in Three Ballpark Center at The Battery Atlanta. The space is designed to drive continued menu innovation and optimize integration across marketing, communications, customer experience, operations, human resources, diversity, equity and inclusion, financial planning and analysis, investor relations and development functions. Our information technology, finance, supply chain, and legal teams will continue to operate in our Louisville, Kentucky office, which remains critical to our success. We also maintain an office outside of London, United Kingdom, where our international operations are managed. We record severance as a one-time termination benefit and recognize the expense ratably over the employees’ required future service period. All other costs, including employee transition costs, recruitment and relocation costs, and third-party costs, are recognized in the period incurred. All strategic corporate reorganization costs have been recorded in General and administrative expenses on the Condensed Consolidated Statement of Operations. As of September 26, 2021 and December 27, 2020, the estimate of incurred but unpaid strategic corporate reorganization costs are included in Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets. The following table summarizes the activity for the nine months ended September 26, 2021: Balance at Balance at December 27, September 26, 2020 Charges Payments 2021 Employee severance and other employee transition costs $ 4,615 $ 3,576 $ (7,235) $ 956 Recruiting and professional fees 145 2,431 (2,576) — Relocation costs 101 2,608 (1,677) 1,032 Other costs — 749 (749) — Total strategic corporate reorganization liability $ 4,861 $ 9,364 $ (12,237) $ 1,988 We expect to recognize additional costs associated with the corporate reorganization in the remainder of 2021 of approximately $2.0 to $5.0 million. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 26, 2021 | |
Segment Information | |
Segment Information | 11. Segment Information We have four reportable segments: domestic Company-owned restaurants, North America franchising, North America commissaries, and international operations. The domestic Company-owned restaurant segment consists of the operations of all domestic (“domestic” is defined as contiguous United States) Company-owned restaurants and derives its revenues principally from retail sales of pizza, Papadias, which are flatbread-style sandwiches, and side items, including breadsticks, cheesesticks, chicken poppers and wings, dessert items and canned or bottled beverages. The North America commissary segment consists of the operations of our regional dough production and product distribution centers and derives its revenues principally from the sale and distribution of food and paper products to domestic Company-owned and franchised restaurants in the United States and Canada. The North America franchising segment consists of our franchise sales and support activities and derives its revenues from sales of franchise and development rights and collection of royalties from our franchisees located in the United States and Canada. The international segment principally consists of distribution sales to franchised Papa John’s restaurants located in the United Kingdom and our franchise sales and support activities, which derive revenues from sales of franchise and development rights and the collection of royalties from our international franchisees. International franchisees are defined as all franchise operations outside of the United States and Canada. All other business units that do not meet the quantitative thresholds for determining reportable segments, which are not operating segments, we refer to as “all other,” which consists of operations that derive revenues from the sale, principally to Company-owned and franchised restaurants, of printing and promotional items, franchise contributions to marketing funds and information systems and related services used in restaurant operations, including our point-of-sale system, online and other technology-based ordering platforms. Generally, we evaluate performance and allocate resources based on operating income and intercompany eliminations. Certain administrative and capital costs are allocated to segments based upon predetermined rates or estimated resource usage. We account for intercompany sales and transfers as if the sales or transfers were to third parties and eliminate the activity in consolidation. Our reportable segments are business units that provide different products or services. Separate management of each segment is required because each business unit is subject to different operational issues and strategies. No single external customer accounted for 10% or more of our consolidated revenues. Our segment information is as follows: Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, (In thousands) 2021 2020 2021 2020 Revenues: Domestic Company-owned restaurants $ 191,584 $ 178,371 $ 584,942 $ 526,317 North America franchising 31,933 25,281 97,123 68,895 North America commissaries 189,224 181,338 560,743 504,379 International 46,880 40,328 135,761 106,846 All others 53,161 47,623 160,967 136,986 Total revenues $ 512,782 $ 472,941 $ 1,539,536 $ 1,343,423 Intersegment revenues: North America franchising $ 1,037 $ 824 $ 3,138 $ 2,291 North America commissaries 53,454 50,306 158,952 142,169 All others 18,522 27,168 56,613 66,509 Total intersegment revenues $ 73,013 $ 78,298 $ 218,703 $ 210,969 Operating income: Domestic Company-owned restaurants $ 9,480 $ 8,439 $ 40,165 $ 33,852 North America franchising 29,830 23,353 90,791 62,855 North America commissaries 9,598 8,208 29,089 24,579 International 9,618 7,986 26,665 16,836 All others 3,848 3,193 14,860 5,030 Unallocated corporate expenses (23,158) (26,921) (70,937) (71,978) Elimination of intersegment losses (profits) (639) 291 (557) (619) Total operating income $ 38,577 $ 24,549 $ 130,076 $ 70,555 Property and equipment, net: Domestic Company-owned restaurants $ 237,155 North America commissaries 147,186 International 15,026 All others 103,054 Unallocated corporate assets 229,359 Accumulated depreciation and amortization (522,708) Total property and equipment, net $ 209,072 Disaggregation of Revenue In the following tables, revenues are disaggregated by major product/service line. The tables also include a reconciliation of the disaggregated revenues by the reportable segment (in thousands): Reportable Segments Three Months Ended September 26, 2021 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 191,584 $ - $ - $ - $ - $ 191,584 Franchise royalties and fees - 32,970 - 14,031 - 47,001 Commissary sales - - 242,678 24,377 - 267,055 Other revenues - - - 8,472 71,683 80,155 Eliminations - (1,037) (53,454) - (18,522) (73,013) Total segment revenues $ 191,584 $ 31,933 $ 189,224 $ 46,880 $ 53,161 $ 512,782 International other revenues (1) - - - (8,472) 8,472 - Total revenues $ 191,584 $ 31,933 $ 189,224 $ 38,408 $ 61,633 $ 512,782 Reportable Segments Three Months Ended September 27, 2020 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 178,371 $ - $ - $ - $ - $ 178,371 Franchise royalties and fees - 26,105 - 10,703 - 36,808 Commissary sales - - 231,644 22,737 - 254,381 Other revenues - - - 6,888 74,791 81,679 Eliminations - (824) (50,306) - (27,168) (78,298) Total segment revenues $ 178,371 $ 25,281 $ 181,338 $ 40,328 $ 47,623 $ 472,941 International other revenues (1) - - - (6,888) 6,888 - Total revenues $ 178,371 $ 25,281 $ 181,338 $ 33,440 $ 54,511 $ 472,941 Reportable Segments Nine Months Ended September 26, 2021 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 584,942 $ - $ - $ - $ - $ 584,942 Franchise royalties and fees - 100,261 - 39,396 - 139,657 Commissary sales - - 719,695 71,233 - 790,928 Other revenues - - - 25,132 217,580 242,712 Eliminations - (3,138) (158,952) - (56,613) (218,703) Total segment revenues $ 584,942 $ 97,123 $ 560,743 $ 135,761 $ 160,967 $ 1,539,536 International other revenues (1) - - - (25,132) 25,132 - Total revenues $ 584,942 $ 97,123 $ 560,743 $ 110,629 $ 186,099 $ 1,539,536 Reportable Segments Nine Months Ended September 27, 2020 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 526,317 $ - $ - $ - $ - $ 526,317 Franchise royalties and fees - 71,186 - 27,962 - 99,148 Commissary sales - - 646,548 59,630 - 706,178 Other revenues - - - 19,254 203,495 222,749 Eliminations - (2,291) (142,169) - (66,509) (210,969) Total segment revenues $ 526,317 $ 68,895 $ 504,379 $ 106,846 $ 136,986 $ 1,343,423 International other revenues (1) - - - (19,254) 19,254 - Total revenues $ 526,317 $ 68,895 $ 504,379 $ 87,592 $ 156,240 $ 1,343,423 (1) Other revenues as reported in the Condensed Consolidated Statements of Operations include $8.5 million and $25.1 million of revenue for the three and nine months ended September 26, 2021, respectively, and $6.9 million and $19.3 million of revenue for the three and nine months ended September 27, 2020, respectively, that are part of the international reporting segment. These amounts include marketing fund contributions and sublease rental income from international franchisees in the United Kingdom that provide no significant contribution to operating income but must be reported on a gross basis under accounting requirements. The related expenses for these Other revenues are reported in Other expenses in the Condensed Consolidated Statements of Operations. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 26, 2021 | |
Significant Accounting Policies | |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Significant items that are subject to such estimates and assumptions include allowance for credit losses on accounts and notes receivable, intangible assets, contract assets and contract liabilities, including the online customer loyalty program obligation and gift card breakage, right-of-use assets and lease liabilities, insurance reserves and tax reserves. Although management bases its estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, actual results could significantly differ from these estimates. |
Variable Interest Entity | Variable Interest Entity Papa John’s domestic restaurants, both Company-owned and franchised, participate in Papa John’s Marketing Fund, Inc. (“PJMF”), a nonstock corporation designed to operate at break-even as it spends all annual contributions received from the system. PJMF collects a percentage of revenues from Company-owned and franchised restaurants in the United States for the purpose of designing and administering advertising and promotional programs. PJMF is a variable interest entity (“VIE”) that funds its operations with ongoing financial support and contributions from the domestic restaurants, of which approximately 80% are franchised, and does not have sufficient equity to fund its operations without these ongoing financial contributions. Based on an assessment of the governance structure and operating procedures of PJMF, the Company determined it has the power to control certain significant activities of PJMF, and therefore, is the primary beneficiary. The Company has consolidated PJMF in its financial results in accordance with Accounting Standards Codification (“ASC”) 810, “Consolidations.” |
Noncontrolling Interests | Noncontrolling Interests Papa John’s has four joint venture arrangements in which there are noncontrolling interests held by third parties that include 188 and 192 restaurants at September 26, 2021 and September 27, 2020, respectively. Consolidated net income is required to be reported separately at amounts attributable to both the Company and the noncontrolling interests. Additionally, disclosures are required to clearly identify and distinguish between the interests of the Company and the interests of the noncontrolling owners, including a disclosure on the face of the Condensed Consolidated Statements of Operations of net income attributable to noncontrolling interests. Net income attributable to these joint ventures for the three and nine months ended September 26, 2021 and September 27, 2020 was as follows (in thousands): Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2021 2020 2021 2020 Papa John’s International, Inc. $ 2,171 $ 1,292 $ 6,816 $ 4,743 Noncontrolling interests 1,285 689 4,021 2,576 Total net income $ 3,456 $ 1,981 $ 10,837 $ 7,319 The following summarizes the redemption feature, location and related accounting within the Condensed Consolidated Balance Sheets for these joint venture arrangements: Type of Joint Venture Arrangement Location within the Balance Sheets Recorded Value Joint ventures with no redemption feature Permanent equity Carrying value Joint ventures with option to require the Company to purchase the noncontrolling interest - not currently redeemable or redemption not probable Temporary equity Carrying value |
Deferred Income Tax Accounts and Tax Reserves | Deferred Income Tax Accounts and Tax Reserves We are subject to income taxes in the United States and several foreign jurisdictions. Significant judgment is required in determining Papa John’s provision for income taxes and the related assets and liabilities. The provision for income taxes includes income taxes paid, currently payable or receivable and those deferred. We use an estimated annual effective rate based on expected annual income to determine our quarterly provision for income taxes. The effective income tax rate includes the estimated domestic state effective income tax rate and applicable foreign income tax rates. The effective income tax rate is also impacted by various permanent items and credits, net of any related valuation allowances, and can vary based on changes in estimated annual income. Discrete items are recorded in the quarter in which they occur. Deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities and are measured using enacted tax rates and laws that are expected to be in effect when the differences reverse. Deferred tax assets are also recognized for the estimated future effects of tax attribute carryforwards (e.g., net operating losses, capital losses, and foreign tax credits). The effect on deferred taxes of changes in tax rates is recognized in the period in which the new tax rate is enacted. Valuation allowances are established when necessary on a jurisdictional basis to reduce deferred tax assets to the amounts we expect to realize. Tax authorities periodically audit the Company. We record reserves and related interest and penalties for identified exposures as income tax expense. We evaluate these issues on a quarterly basis to adjust for events, such as statute of limitations expirations, court or state rulings or audit settlements, which may impact our ultimate payment for such exposures. |
Fair Value Measurements and Disclosures | Fair Value Measurements and Disclosures The Company determines the fair value of financial assets and liabilities based on the price that would be received to sell the asset or paid to transfer the liability to a market participant. Certain assets and liabilities are measured at fair value on a recurring basis and are required to be classified and disclosed in one of the following three categories: ● Level 1: Quoted market prices in active markets for identical assets or liabilities. ● Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. ● Level 3: Unobservable inputs that are not corroborated by market data. Fair value is a market-based measurement, not an entity-specific measurement. Considerable judgment is required to interpret market data to estimate fair value; accordingly, the fair values presented do not necessarily indicate what the Company or its debtholders could realize in a current market exchange. Our financial assets and liabilities that were measured at fair value on a recurring basis as of September 26, 2021 and December 27, 2020 are as follows: Carrying Fair Value Measurements (in thousands) Value Level 1 Level 2 Level 3 September 26, 2021 Financial assets: Cash surrender value of life insurance policies (a) $ 40,482 $ 40,482 $ — $ — Financial liabilities: Interest rate swaps (b) 8,162 — 8,162 — December 27, 2020 Financial assets: Cash surrender value of life insurance policies (a) $ 37,578 $ 37,578 $ — $ — Financial liabilities: Interest rate swaps (b) 13,452 — 13,452 — (a) Represents life insurance policies held in our non-qualified deferred compensation plan. (b) The fair value of our interest rate swaps is based on the sum of all future net present value cash flows. The future cash flows are derived based on the terms of our interest rate swaps, as well as considering published discount factors, and projected London Interbank Offered Rates (“LIBOR”). The fair value of certain assets and liabilities approximates carrying value because of the short-term nature of the accounts, including cash and cash equivalents, accounts receivable, net of allowances, and accounts payable. The carrying value of notes receivable, net of allowances, also approximates fair value. The Company’s revolving credit facilities and term debt under the Previous Credit Facility approximate carrying value due to their variable market-based interest rate. The Company’s 3.875% senior notes are classified as a Level 2 fair value measurement since the Company estimates the fair value by using recent trading transactions, and have the following estimated fair values and carrying values (excluding the impact of unamortized debt issuance costs) as of September 26, 2021 and December 27, 2020, respectively: September 26, 2021 December 27, 2020 Carrying Fair Carrying Fair (in thousands) Value Value Value Value 3.875% Senior Notes $ 400,000 $ 401,000 $ — $ — |
Allowance for Credit Losses | Allowance for Credit Losses Estimates of expected credit losses, even if remote, are based upon historical account write-off trends, facts about the current financial condition of the debtor, forecasts of future operating results based upon current trends of select operating metrics, and macroeconomic factors. Credit quality is monitored through the timing of payments compared to the prescribed payment terms and known facts regarding the financial condition of the franchisee or customer. Account and note balances are charged off against the allowance after recovery efforts have ceased. The following table summarizes changes in our allowances for credit losses for accounts receivable and notes receivable: (in thousands) Accounts Receivable Notes Receivable Balance at December 27, 2020 $ 3,622 $ 3,211 Current period benefit for expected credit losses (80) (563) Write-offs charged against the allowance (1,212) (843) Recoveries collected — (277) Balance at September 26, 2021 $ 2,330 $ 1,528 |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Significant Accounting Policies | |
Schedule of net income attributable to Joint Ventures | Net income attributable to these joint ventures for the three and nine months ended September 26, 2021 and September 27, 2020 was as follows (in thousands): Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2021 2020 2021 2020 Papa John’s International, Inc. $ 2,171 $ 1,292 $ 6,816 $ 4,743 Noncontrolling interests 1,285 689 4,021 2,576 Total net income $ 3,456 $ 1,981 $ 10,837 $ 7,319 |
Schedule of Joint Ventures in Which There are Noncontrolling Interests | The following summarizes the redemption feature, location and related accounting within the Condensed Consolidated Balance Sheets for these joint venture arrangements: Type of Joint Venture Arrangement Location within the Balance Sheets Recorded Value Joint ventures with no redemption feature Permanent equity Carrying value Joint ventures with option to require the Company to purchase the noncontrolling interest - not currently redeemable or redemption not probable Temporary equity Carrying value |
Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | Our financial assets and liabilities that were measured at fair value on a recurring basis as of September 26, 2021 and December 27, 2020 are as follows: Carrying Fair Value Measurements (in thousands) Value Level 1 Level 2 Level 3 September 26, 2021 Financial assets: Cash surrender value of life insurance policies (a) $ 40,482 $ 40,482 $ — $ — Financial liabilities: Interest rate swaps (b) 8,162 — 8,162 — December 27, 2020 Financial assets: Cash surrender value of life insurance policies (a) $ 37,578 $ 37,578 $ — $ — Financial liabilities: Interest rate swaps (b) 13,452 — 13,452 — (a) Represents life insurance policies held in our non-qualified deferred compensation plan. (b) The fair value of our interest rate swaps is based on the sum of all future net present value cash flows. The future cash flows are derived based on the terms of our interest rate swaps, as well as considering published discount factors, and projected London Interbank Offered Rates (“LIBOR”). The fair value of certain assets and liabilities approximates carrying value because of the short-term nature of the accounts, including cash and cash equivalents, accounts receivable, net of allowances, and accounts payable. The carrying value of notes receivable, net of allowances, also approximates fair value. The Company’s revolving credit facilities and term debt under the Previous Credit Facility approximate carrying value due to their variable market-based interest rate. The Company’s 3.875% senior notes are classified as a Level 2 fair value measurement since the Company estimates the fair value by using recent trading transactions, and have the following estimated fair values and carrying values (excluding the impact of unamortized debt issuance costs) as of September 26, 2021 and December 27, 2020, respectively: September 26, 2021 December 27, 2020 Carrying Fair Carrying Fair (in thousands) Value Value Value Value 3.875% Senior Notes $ 400,000 $ 401,000 $ — $ — |
Schedule rollforward of the allowance for credit losses for accounts receivable, notes receivable and other assets | (in thousands) Accounts Receivable Notes Receivable Balance at December 27, 2020 $ 3,622 $ 3,211 Current period benefit for expected credit losses (80) (563) Write-offs charged against the allowance (1,212) (843) Recoveries collected — (277) Balance at September 26, 2021 $ 2,330 $ 1,528 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Leases | |
Schedule of supplemental cash flow information | Supplemental cash flow information related to leases for the periods reported is as follows: Nine Months Ended (in thousands) September 26, 2021 September 27, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 864 $ 435 Financing cash flows from finance leases 3,358 1,438 Operating cash flows from operating leases (a) 28,830 27,965 Right-of-use assets obtained in exchange for new finance lease liabilities 9,190 1,056 Right-of-use assets obtained in exchange for new operating lease liabilities (b) 52,462 18,421 Cash received from sublease income 8,728 7,641 (a) Included within the change in Other assets and liabilities within the Condensed Consolidated Statements of Cash Flows offset by non-cash operating lease right-of-use asset amortization and lease liability accretion. (b) Includes right-of-use assets of approximately |
Papa John's Marketing Fund, I_2
Papa John's Marketing Fund, Inc. (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Papa John's Marketing Fund, Inc. | |
Schedule of Assets and Liabilities of PJMF | Assets and liabilities of PJMF, which are restricted in their use, included in the Condensed Consolidated Balance Sheets were as follows (in thousands): September 26, December 27, 2021 2020 Assets Current assets: Cash and cash equivalents $ 32,629 $ 9,394 Accounts receivable, net 13,078 23,711 Income tax receivable 191 192 Prepaid expenses and other current assets 1,802 1,914 Total current assets 47,700 35,211 Deferred income taxes 595 588 Total assets $ 48,295 $ 35,799 Liabilities Current liabilities: Accounts payable $ 9,810 $ 5,429 Income and other taxes payable 2 2 Accrued expenses and other current liabilities 39,663 32,578 Current deferred revenue 3,235 3,938 Total current liabilities 52,710 41,947 Deferred revenue 1,881 2,419 Total liabilities $ 54,591 $ 44,366 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Revenue Recognition | |
Schedule of information about contract liabilities | The following table includes a breakout of contract liability balances (in thousands): Contract Liabilities September 26, 2021 December 27, 2020 Change Franchise fees and unredeemed gift card liabilities $ 17,949 $ 19,890 $ (1,941) Customer loyalty program obligations 15,139 13,364 1,775 Total contract liabilities $ 33,088 $ 33,254 $ (166) |
Schedule of estimated revenue expected to be recognized in the future | The following table (in thousands) includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied at the end of the reporting period. Performance Obligations by Period Less than 1 Year 1-2 Years 2-3 Years 3-4 Years 4-5 Years Thereafter Total Franchise fees $ 2,242 $ 2,003 $ 1,766 $ 1,550 $ 1,294 $ 2,477 $ 11,332 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Earnings (Loss) Per Share | |
Schedule of Earnings (Loss) Per Share, Basic and Diluted | The calculations of basic and diluted earnings (loss) per common share are as follows (in thousands, except per-share data): Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2021 2020 2021 2020 Basic earnings (loss) per common share Net income attributable to the Company $ 29,256 $ 15,708 $ 95,393 $ 44,765 Dividends on redemption of Series B Convertible Preferred Stock — — (109,852) — Dividends paid to participating securities (137) (3,548) (5,964) (10,546) Net income attributable to participating securities (158) (703) — (1,809) Net income (loss) attributable to common shareholders $ 28,961 $ 11,457 $ (20,423) $ 32,410 Basic weighted average common shares outstanding 36,387 32,616 34,619 32,347 Basic earnings (loss) per common share $ 0.80 $ 0.35 $ (0.59) $ 1.00 Diluted earnings (loss) per common share Net income (loss) attributable to common shareholders $ 28,961 $ 11,457 $ (20,423) $ 32,410 Weighted average common shares outstanding 36,387 32,616 34,619 32,347 Dilutive effect of outstanding equity awards (a) 332 355 — 296 Diluted weighted average common shares outstanding (b) 36,719 32,971 34,619 32,643 Diluted earnings (loss) per common share $ 0.79 $ 0.35 $ (0.59) $ 0.99 (a) Excludes 132 equity awards for the nine months ended September 27, 2020, as the effect of including such awards would have been anti-dilutive. (b) The Company had 252.5 shares of Series B Preferred Stock outstanding at September 27, 2020 (none at September 26, 2021). For the fully diluted calculation, the Series B Preferred stock dividends were added back to net income attributable to common shareholders. The Company then applied the if-converted method to calculate dilution on the Series B Preferred Stock, which resulted in 5.0 million additional common shares for September 27, 2020. This calculation was anti-dilutive for the September 27, 2020 period and as such was excluded. |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Debt | |
Schedule of long-term debt, net | Long-term debt, net, consists of the following (in thousands): September 26, December 27, 2021 2020 Outstanding debt $ 425,000 $ 350,000 Unamortized debt issuance costs (10,085) (1,708) Current portion of long-term debt — (20,000) Total long-term debt, net $ 414,915 $ 328,292 |
Schedule of Interest Rate Swap Agreements | Effective Dates Floating Rate Debt Fixed Rates April 30, 2018 through April 30, 2023 $ 55 million 2.33 % April 30, 2018 through April 30, 2023 $ 35 million 2.36 % April 30, 2018 through April 30, 2023 $ 35 million 2.34 % January 30, 2018 through August 30, 2022 $ 100 million 1.99 % January 30, 2018 through August 30, 2022 $ 75 million 1.99 % January 30, 2018 through August 30, 2022 $ 50 million 2.00 % |
Schedule of Location and Amounts of Swaps in the Accompanying Consolidated Financial Statements | The following table provides information on the location and amounts of our swaps in the accompanying condensed consolidated financial statements (in thousands): Interest Rate Swap Derivatives Fair Value Fair Value September 26, December 27, Balance Sheet Location 2021 2020 Other current and long-term liabilities $ 8,162 $ 13,452 |
Schedule of Effect of Derivative Instruments on the Accompanying Consolidated Financial Statements | The effect of derivative instruments on the accompanying condensed consolidated financial statements is as follows (in thousands): Location of Gain Amount of Gain Derivatives - Amount of Gain or or (Loss) or (Loss) Total Net Interest Expense Cash Flow (Loss) Recognized Reclassified from Reclassified from on Condensed Hedging in AOCL AOCL into AOCL into Consolidated Statements Relationships on Derivative Income Income of Operations Interest rate swaps for the three months ended: September 26, 2021 $ 1,182 Interest expense $ (1,644) $ (3,979) September 27, 2020 $ 1,268 Interest expense $ (1,674) $ (3,636) Interest rate swaps for the nine months ended: September 26, 2021 $ 3,963 Interest expense $ (5,084) $ (11,275) September 27, 2020 $ (7,219) Interest expense $ (3,376) $ (11,230) |
Strategic Corporate Reorganiz_2
Strategic Corporate Reorganization for Long-term Growth (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Strategic Corporate Reorganization for Long-term Growth | |
Summary of activity of restructuring liability | Balance at Balance at December 27, September 26, 2020 Charges Payments 2021 Employee severance and other employee transition costs $ 4,615 $ 3,576 $ (7,235) $ 956 Recruiting and professional fees 145 2,431 (2,576) — Relocation costs 101 2,608 (1,677) 1,032 Other costs — 749 (749) — Total strategic corporate reorganization liability $ 4,861 $ 9,364 $ (12,237) $ 1,988 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 26, 2021 | |
Segment Information | |
Schedule of Segment Reporting Information, by Segment | Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, (In thousands) 2021 2020 2021 2020 Revenues: Domestic Company-owned restaurants $ 191,584 $ 178,371 $ 584,942 $ 526,317 North America franchising 31,933 25,281 97,123 68,895 North America commissaries 189,224 181,338 560,743 504,379 International 46,880 40,328 135,761 106,846 All others 53,161 47,623 160,967 136,986 Total revenues $ 512,782 $ 472,941 $ 1,539,536 $ 1,343,423 Intersegment revenues: North America franchising $ 1,037 $ 824 $ 3,138 $ 2,291 North America commissaries 53,454 50,306 158,952 142,169 All others 18,522 27,168 56,613 66,509 Total intersegment revenues $ 73,013 $ 78,298 $ 218,703 $ 210,969 Operating income: Domestic Company-owned restaurants $ 9,480 $ 8,439 $ 40,165 $ 33,852 North America franchising 29,830 23,353 90,791 62,855 North America commissaries 9,598 8,208 29,089 24,579 International 9,618 7,986 26,665 16,836 All others 3,848 3,193 14,860 5,030 Unallocated corporate expenses (23,158) (26,921) (70,937) (71,978) Elimination of intersegment losses (profits) (639) 291 (557) (619) Total operating income $ 38,577 $ 24,549 $ 130,076 $ 70,555 Property and equipment, net: Domestic Company-owned restaurants $ 237,155 North America commissaries 147,186 International 15,026 All others 103,054 Unallocated corporate assets 229,359 Accumulated depreciation and amortization (522,708) Total property and equipment, net $ 209,072 |
Schedule of revenue disaggregated by major product line | In the following tables, revenues are disaggregated by major product/service line. The tables also include a reconciliation of the disaggregated revenues by the reportable segment (in thousands): Reportable Segments Three Months Ended September 26, 2021 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 191,584 $ - $ - $ - $ - $ 191,584 Franchise royalties and fees - 32,970 - 14,031 - 47,001 Commissary sales - - 242,678 24,377 - 267,055 Other revenues - - - 8,472 71,683 80,155 Eliminations - (1,037) (53,454) - (18,522) (73,013) Total segment revenues $ 191,584 $ 31,933 $ 189,224 $ 46,880 $ 53,161 $ 512,782 International other revenues (1) - - - (8,472) 8,472 - Total revenues $ 191,584 $ 31,933 $ 189,224 $ 38,408 $ 61,633 $ 512,782 Reportable Segments Three Months Ended September 27, 2020 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 178,371 $ - $ - $ - $ - $ 178,371 Franchise royalties and fees - 26,105 - 10,703 - 36,808 Commissary sales - - 231,644 22,737 - 254,381 Other revenues - - - 6,888 74,791 81,679 Eliminations - (824) (50,306) - (27,168) (78,298) Total segment revenues $ 178,371 $ 25,281 $ 181,338 $ 40,328 $ 47,623 $ 472,941 International other revenues (1) - - - (6,888) 6,888 - Total revenues $ 178,371 $ 25,281 $ 181,338 $ 33,440 $ 54,511 $ 472,941 Reportable Segments Nine Months Ended September 26, 2021 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 584,942 $ - $ - $ - $ - $ 584,942 Franchise royalties and fees - 100,261 - 39,396 - 139,657 Commissary sales - - 719,695 71,233 - 790,928 Other revenues - - - 25,132 217,580 242,712 Eliminations - (3,138) (158,952) - (56,613) (218,703) Total segment revenues $ 584,942 $ 97,123 $ 560,743 $ 135,761 $ 160,967 $ 1,539,536 International other revenues (1) - - - (25,132) 25,132 - Total revenues $ 584,942 $ 97,123 $ 560,743 $ 110,629 $ 186,099 $ 1,539,536 Reportable Segments Nine Months Ended September 27, 2020 Major Products/Services Lines Domestic Company-owned restaurants North America franchising North America commissaries International All others Total Company-owned restaurant sales $ 526,317 $ - $ - $ - $ - $ 526,317 Franchise royalties and fees - 71,186 - 27,962 - 99,148 Commissary sales - - 646,548 59,630 - 706,178 Other revenues - - - 19,254 203,495 222,749 Eliminations - (2,291) (142,169) - (66,509) (210,969) Total segment revenues $ 526,317 $ 68,895 $ 504,379 $ 106,846 $ 136,986 $ 1,343,423 International other revenues (1) - - - (19,254) 19,254 - Total revenues $ 526,317 $ 68,895 $ 504,379 $ 87,592 $ 156,240 $ 1,343,423 (1) Other revenues as reported in the Condensed Consolidated Statements of Operations include $8.5 million and $25.1 million of revenue for the three and nine months ended September 26, 2021, respectively, and $6.9 million and $19.3 million of revenue for the three and nine months ended September 27, 2020, respectively, that are part of the international reporting segment. These amounts include marketing fund contributions and sublease rental income from international franchisees in the United Kingdom that provide no significant contribution to operating income but must be reported on a gross basis under accounting requirements. The related expenses for these Other revenues are reported in Other expenses in the Condensed Consolidated Statements of Operations. |
Significant Accounting Polici_4
Significant Accounting Policies - Noncontrolling Interest and Joint Ventures (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2021USD ($)entityrestaurant | Sep. 27, 2020USD ($)entityrestaurant | Sep. 26, 2021USD ($)entityrestaurant | Sep. 27, 2020USD ($)entityrestaurant | |
Noncontrolling Interests | ||||
Percentage of domestic restaurants franchised | 80.00% | 80.00% | ||
Number of Joint Ventures Having Noncontrolling Interests | entity | 4 | 4 | 4 | 4 |
Income Amounts Attributable to Noncontrolling Interest, Disclosures | ||||
Net income attributable to the Company | $ 29,256 | $ 15,708 | $ 95,393 | $ 44,765 |
Joint ventures | ||||
Noncontrolling Interests | ||||
Number of Restaurants | restaurant | 188 | 192 | 188 | 192 |
Income Amounts Attributable to Noncontrolling Interest, Disclosures | ||||
Papa John's International, Inc. | $ 2,171 | $ 1,292 | $ 6,816 | $ 4,743 |
Noncontrolling interests | 1,285 | 689 | 4,021 | 2,576 |
Net income attributable to the Company | $ 3,456 | $ 1,981 | $ 10,837 | $ 7,319 |
Significant Accounting Polici_5
Significant Accounting Policies - Fair Value Measurements (Details) - USD ($) $ in Thousands | Sep. 26, 2021 | Sep. 14, 2021 | Dec. 27, 2020 |
Carrying Value | |||
Measurement of financial assets and liabilities at fair value on a recurring basis | |||
Cash surrender value of life insurance policies | $ 40,482 | $ 37,578 | |
Interest rate swap liabilities | $ 8,162 | 13,452 | |
Notes | |||
Measurement of financial assets and liabilities at fair value on a recurring basis | |||
Fixed interest rate (as a percent) | 3.875% | 3.875% | |
Notes | Carrying Value | |||
Measurement of financial assets and liabilities at fair value on a recurring basis | |||
3.875% Fixed Rate Senior Notes | $ 400,000 | ||
Measured on Recurring Basis | Level 1 | |||
Measurement of financial assets and liabilities at fair value on a recurring basis | |||
Cash surrender value of life insurance policies | 40,482 | 37,578 | |
Measured on Recurring Basis | Level 2 | |||
Measurement of financial assets and liabilities at fair value on a recurring basis | |||
Interest rate swap liabilities | 8,162 | $ 13,452 | |
Measured on Recurring Basis | Notes | Level 2 | |||
Measurement of financial assets and liabilities at fair value on a recurring basis | |||
3.875% Fixed Rate Senior Notes | $ 401,000 |
Significant Accounting Polici_6
Significant Accounting Policies - Schedule rollforward of the allowance for credit losses for accounts receivable, notes receivable and other assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2021 | Sep. 27, 2020 | |
Allowance for Credit Loss | ||
Current period (credit) provision for expected credit losses | $ (920) | $ (334) |
Accounts Receivable | ||
Allowance for Credit Losses | ||
Balance at beginning of period | 3,622 | |
Current period benefit for expected credit losses | (80) | |
Write-offs charged against the allowance | (1,212) | |
Balance at end of period | 2,330 | |
Notes Receivable | ||
Allowance for Credit Losses | ||
Balance at beginning of period | 3,211 | |
Current period benefit for expected credit losses | (563) | |
Write-offs charged against the allowance | (843) | |
Recoveries collected | (277) | |
Balance at end of period | $ 1,528 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments, Lessor Operating Leases, and Lease Guarantees (Details) $ in Millions | 9 Months Ended | |
Sep. 26, 2021USD ($)restaurantlease | Sep. 27, 2020USD ($) | |
Leases | ||
sublease income | $ 9 | $ 7.6 |
Number of domestic leases for which the Company is contingently liable | lease | 71 | |
Estimated maximum amount of undiscounted payments in the event of nonpayment by primary lessees | $ 12.1 | |
United Kingdom franchise-owned restaurants | ||
Leases | ||
Number of units leased and subleased | restaurant | 410 | |
Initial lease terms on franchised sites | 15 years |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2021 | Sep. 27, 2020 | |
Leases | ||
Operating cash flows from finance leases | $ 864 | $ 435 |
Financing cash flows from finance leases | 3,358 | 1,438 |
Operating cash flows from operating leases | 28,830 | 27,965 |
Right-of-use assets obtained in exchange for new finance lease liabilities | 9,190 | 1,056 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 52,462 | 18,421 |
Cash received from sublease income | 8,728 | $ 7,641 |
Corporate Headquarters Atlanta, Georgia | ||
Leases | ||
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 21,800 |
Papa John's Marketing Fund, I_3
Papa John's Marketing Fund, Inc. (Details) - USD ($) $ in Thousands | Sep. 26, 2021 | Dec. 27, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 105,813 | $ 130,204 |
Accounts receivable, net | 79,534 | 90,135 |
Income tax receivable | 599 | 1,273 |
Prepaid expenses and other current assets | 39,249 | 43,212 |
Total current assets | 271,760 | 306,407 |
Deferred income taxes | 13,926 | 10,800 |
Total assets | 889,954 | 872,770 |
Current liabilities: | ||
Accounts payable | 42,384 | 37,370 |
Income and other taxes payable | 26,221 | 10,263 |
Accrued expenses and other current liabilities | 201,528 | 174,563 |
Current deferred revenue | 20,617 | 19,590 |
Total current liabilities | 318,119 | 288,869 |
Deferred revenue | 12,471 | 13,664 |
Total liabilities | 1,019,469 | 881,334 |
Papa John's Marketing Fund Inc. | ||
Current assets: | ||
Cash and cash equivalents | 32,629 | 9,394 |
Accounts receivable, net | 13,078 | 23,711 |
Income tax receivable | 191 | 192 |
Prepaid expenses and other current assets | 1,802 | 1,914 |
Total current assets | 47,700 | 35,211 |
Deferred income taxes | 595 | 588 |
Total assets | 48,295 | 35,799 |
Current liabilities: | ||
Accounts payable | 9,810 | 5,429 |
Income and other taxes payable | 2 | 2 |
Accrued expenses and other current liabilities | 39,663 | 32,578 |
Current deferred revenue | 3,235 | 3,938 |
Total current liabilities | 52,710 | 41,947 |
Deferred revenue | 1,881 | 2,419 |
Total liabilities | $ 54,591 | $ 44,366 |
Revenue Recognition - Contract
Revenue Recognition - Contract Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | Jun. 27, 2021 | Dec. 27, 2020 | Jun. 28, 2020 | Dec. 29, 2019 | |
Revenue disaggregation | ||||||||
Cumulative effect of adoption of Topic 606 | $ (137,046) | $ (272,845) | $ (137,046) | $ (272,845) | $ (147,898) | $ (266,939) | $ (291,848) | $ (316,656) |
Revenue recognized related to deferred revenue and customer loyalty program | 9,200 | $ 8,400 | 27,300 | $ 24,700 | ||||
Contract liabilities | 33,088 | 33,088 | 33,254 | |||||
Change | (166) | |||||||
Contract assets | 5,600 | 5,600 | 5,100 | |||||
Amortization expense related to contract assets | 800 | 2,200 | ||||||
Franchise fees and unredeemed gift card liabilities | ||||||||
Revenue disaggregation | ||||||||
Contract liabilities | 17,949 | 17,949 | 19,890 | |||||
Change | (1,941) | |||||||
Customer loyalty program obligations | ||||||||
Revenue disaggregation | ||||||||
Contract liabilities | $ 15,139 | 15,139 | $ 13,364 | |||||
Change | $ 1,775 |
Revenue Recognition - Transacti
Revenue Recognition - Transaction Price Allocated to Remaining Performance Obligations (Details) - USD ($) $ in Thousands | Sep. 26, 2021 | Dec. 27, 2020 |
Performance Obligations by Period | ||
Total deferred revenue | $ 33,088 | $ 33,254 |
Franchise royalties and fees | ||
Performance Obligations by Period | ||
Less than 1 Year | 2,242 | |
1-2 Years | 2,003 | |
2-3 Years | 1,766 | |
3-4 Years | 1,550 | |
4-5 Years | 1,294 | |
Thereafter | 2,477 | |
Total deferred revenue | 11,332 | |
Area development fees | ||
Performance Obligations by Period | ||
Total deferred revenue | 1,500 | |
Gift Card | ||
Performance Obligations by Period | ||
Total deferred revenue | $ 5,100 |
Common Stock and Series B Con_2
Common Stock and Series B Convertible Preferred Stock - Shares Authorized and Outstanding (Details) - shares | Sep. 26, 2021 | Dec. 27, 2020 |
Common Stock and Series B Convertible Preferred Stock | ||
Authorized shares of preferred stock | 5,000,000 | 5,000,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Authorized shares of common stock | 100,000,000 | 100,000,000 |
Common stock shares outstanding | 36,200,000 | 32,500,000 |
Common Stock and Series B Con_3
Common Stock and Series B Convertible Preferred Stock - Share Repurchase Program (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 11 Months Ended | |||||||
Oct. 29, 2021 | Sep. 26, 2021 | Jun. 27, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Oct. 28, 2021 | Aug. 03, 2021 | Dec. 27, 2020 | Nov. 04, 2020 | |
Share repurchase program | |||||||||||
Net (loss) income attributable to common shareholders | $ 28,961 | $ 11,457 | $ (20,423) | $ 32,410 | |||||||
Series B Convertible Preferred Stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||||
Dividends on redemption of Series B Convertible Preferred Stock | $ 109,852 | ||||||||||
Preferred stock shares authorized | 0 | 0 | 0 | 260,000 | |||||||
Preferred stock shares outstanding | 0 | 0 | 0 | 0 | |||||||
Outstanding shares of common stock , net of repurchased stock | 36,200,000 | 36,200,000 | 36,200,000 | 32,500,000 | |||||||
Starboard share repurchase agreement | |||||||||||
Share repurchase program | |||||||||||
Series B preferred stock converted into common stock (in shares) | 171,613 | ||||||||||
Number of shares sold | 3,458,360 | ||||||||||
Series B Preferred stock repurchased during period (in shares) | 78,387 | ||||||||||
Series B Convertible Preferred Stock, par value | $ 0.01 | ||||||||||
Franchisee Investors repurchase program | |||||||||||
Share repurchase program | |||||||||||
Series B preferred stock converted into common stock (in shares) | 1,530 | ||||||||||
Number of shares sold | 30,769 | ||||||||||
Franchisee Investors repurchase program | Series B Preferred Stock | |||||||||||
Share repurchase program | |||||||||||
Stock repurchased during period, shares | 1,000 | ||||||||||
Starboard and Franchisee share repurchase program | |||||||||||
Share repurchase program | |||||||||||
Cash payment for repurchase and conversion process | $ 188,600 | ||||||||||
Dividends on redemption of Series B Convertible Preferred Stock | $ 109,900 | ||||||||||
Per share dividends on redemption of Series B Convertible Preferred Stock | $ 3.14 | ||||||||||
Common stock repurchase program | |||||||||||
Share repurchase program | |||||||||||
Stock repurchase program, authorized amount | $ 425,000 | $ 75,000 | |||||||||
Stock repurchased during period, shares | 219,000 | ||||||||||
Share repurchase amount percentage of total shares outstanding (as a percent) | 9.40% | ||||||||||
Stock repurchased during period, value | $ 23,300 | ||||||||||
Share repurchased during period, average cost per share | $ 106.16 | ||||||||||
Common stock repurchase program | Subsequent event | |||||||||||
Share repurchase program | |||||||||||
Stock repurchased during period, shares | 158,000 | ||||||||||
Stock repurchased during period, value | $ 19,800 | ||||||||||
Share repurchased during period, average cost per share | $ 125.50 | ||||||||||
Stock repurchase program, remaining authorized amount | $ 31,900 |
Common Stock and Series B Con_4
Common Stock and Series B Convertible Preferred Stock - Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 28, 2021 | Sep. 26, 2021 | Sep. 27, 2020 |
Cash Dividend | |||
Total dividends | $ 33,200 | ||
Dividends paid to common shareholders | 27,600 | ||
Dividends paid to common shareholders | $ 27,640 | $ 21,856 | |
Dividend paid per common share (in dollars per share) | $ 0.80 | ||
Common stock dividends paid to preferred shareholders | $ 1,100 | ||
Preferred stock dividend rate | 3.60% | ||
Subsequent event | Forecast | |||
Cash Dividend | |||
Dividends paid to common shareholders | $ 12,800 | ||
Quarterly dividend declared, per share (in dollars per share) | $ 0.35 | ||
Starboard and Franchisee share repurchase program | |||
Cash Dividend | |||
Deemed dividend for common stock | $ 1,500 | ||
Series B Preferred Stock | |||
Cash Dividend | |||
Dividend paid per common share (in dollars per share) | $ 0.45 | ||
Preferred dividends | $ 3,000 |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | Dec. 27, 2020 | |
Basic earnings (loss) per common share: | |||||
Net income attributable to the Company | $ 29,256 | $ 15,708 | $ 95,393 | $ 44,765 | |
Dividends on redemption of Series B Convertible Preferred Stock | (109,852) | ||||
Dividends paid to participating securities | (137) | (3,548) | (5,964) | (10,546) | |
Net income attributable to participating securities | (158) | (703) | (1,809) | ||
Net income (loss) attributable to common shareholders | $ 28,961 | $ 11,457 | $ (20,423) | $ 32,410 | |
Basic weighted average common shares outstanding | 36,387,000 | 32,616,000 | 34,619,000 | 32,347,000 | |
Basic earnings (loss) per common share | $ 0.80 | $ 0.35 | $ (0.59) | $ 1 | |
Diluted earnings (loss) per common share: | |||||
Net income (loss) attributable to common shareholders | $ 28,961 | $ 11,457 | $ (20,423) | $ 32,410 | |
Weighted average common shares outstanding | 36,387,000 | 32,616,000 | 34,619,000 | 32,347,000 | |
Dilutive effect of outstanding equity awards | 332,000 | 355,000 | 296,000 | ||
Diluted weighted average common shares outstanding | 36,719,000 | 32,971,000 | 34,619,000 | 32,643,000 | |
Diluted earnings (loss) per common share | $ 0.79 | $ 0.35 | $ (0.59) | $ 0.99 | |
Weighted average antidilutive awards excluded from computation of earnings per share | 132,000 | ||||
Series B Convertible Preferred Stock, shares outstanding | 0 | 0 | 252,500 | ||
Series B Preferred Stock | |||||
Diluted earnings (loss) per common share: | |||||
Weighted average antidilutive awards excluded from computation of earnings per share | 5,000,000 | ||||
Series B Convertible Preferred Stock, shares outstanding | 0 | 252,500,000 | 0 | 252,500,000 |
Debt - Schedule of Long Term De
Debt - Schedule of Long Term Debt (Details) - USD ($) $ in Thousands | Sep. 26, 2021 | Dec. 27, 2020 |
Debt | ||
Outstanding debt | $ 425,000 | $ 350,000 |
Unamortized debt issuance costs | (10,085) | (1,708) |
Current portion of long-term debt | (20,000) | |
Total long-term debt, net | $ 414,915 | $ 328,292 |
Debt - Credit Agreements (Detai
Debt - Credit Agreements (Details) | Sep. 14, 2021USD ($) | Sep. 26, 2021USD ($) | Sep. 26, 2021USD ($)item | Dec. 27, 2020USD ($) |
Debt | ||||
Outstanding debt | $ 425,000,000 | $ 425,000,000 | $ 350,000,000 | |
Debt issuance costs | 10,085,000 | 10,085,000 | 1,708,000 | |
Previous Credit Facility | ||||
Debt | ||||
Line of credit facility, maximum borrowing capacity | 800,000,000 | 800,000,000 | ||
PJI Facilities | ||||
Debt | ||||
Line of credit facility, maximum borrowing capacity | 600,000,000 | 600,000,000 | ||
Outstanding debt | 25,000,000 | $ 25,000,000 | ||
Number of quarters in interest margin period | item | 4 | |||
Line of credit facility, maximum borrowing capacity of foreign currencies | 50,000,000 | $ 50,000,000 | ||
Additional amount that company has option to increase borrowing capacity | 500,000,000 | |||
Line of credit facility, remaining availability | 572,300,000 | $ 572,300,000 | ||
PJI Facilities | Minimum | ||||
Debt | ||||
Percentage of commitment fee on unused credit facility | 0.18% | |||
PJI Facilities | Maximum | ||||
Debt | ||||
Percentage of commitment fee on unused credit facility | 0.30% | |||
PJI Facilities | LIBOR | Minimum | ||||
Debt | ||||
Interest margin rate on debt | 1.25% | |||
PJI Facilities | LIBOR | Maximum | ||||
Debt | ||||
Interest margin rate on debt | 2.00% | |||
PJI Facilities | Base rate | Minimum | ||||
Debt | ||||
Interest margin rate on debt | 0.25% | |||
PJI Facilities | Base rate | Maximum | ||||
Debt | ||||
Interest margin rate on debt | 1.00% | |||
PJI Facilities | Federal funds rate | ||||
Debt | ||||
Interest margin rate on debt | 0.50% | |||
PJI Facilities | London Interbank Offered Rate | ||||
Debt | ||||
Interest margin rate on debt | 1.00% | |||
Amendment to Credit Agreement | ||||
Debt | ||||
Incurred amendment fees | $ 2,100,000 | $ 2,100,000 | ||
Amendment to Credit Agreement | Minimum | ||||
Debt | ||||
Interest coverage ratio | 2 | 2 | ||
Amendment to Credit Agreement | Maximum | ||||
Debt | ||||
Leverage Ratio | 5.25 | 5.25 | ||
Increase to maximum leverage ratio | 0.50 | 0.50 | ||
PJMF Revolving Facility | ||||
Debt | ||||
Line of credit facility, maximum borrowing capacity | $ 20,000,000 | $ 20,000,000 | ||
Outstanding debt | $ 0 | $ 0 | $ 0 | |
Applicable interest rate | 1.90% | 2.70% | ||
PJMF Revolving Facility | One-month LIBOR | ||||
Debt | ||||
Interest margin rate on debt | 1.75% | |||
Notes | ||||
Debt | ||||
Principal amount | $ 400,000,000 | |||
Outstanding debt | $ 400,000,000 | $ 400,000,000 | ||
Fixed interest rate | 3.875% | 3.875% | 3.875% | |
Unamortized debt issuance costs | $ 7,100,000 | |||
Notes | Redemption at any time prior to September 15, 2024 | ||||
Debt | ||||
Redemption price percentage | 100.00% | |||
Notes | Redemption upto 40% at any time prior to September 15,2024 | ||||
Debt | ||||
Redemption price percentage | 103.875% | |||
Notes | Minimum | Redemptionat at any time on or after September 15, 2024 | ||||
Debt | ||||
Redemption price percentage | 0.97% | |||
Notes | Maximum | Redemptionat at any time on or after September 15, 2024 | ||||
Debt | ||||
Redemption price percentage | 1.94% | |||
Notes | Maximum | Redemption upto 40% at any time prior to September 15,2024 | ||||
Debt | ||||
Redemption percentage | 40 | |||
Swingline loans | ||||
Debt | ||||
Line of credit facility, maximum borrowing capacity | $ 40,000,000 | $ 40,000,000 | ||
Letter of credit | ||||
Debt | ||||
Line of credit facility, maximum borrowing capacity | $ 80,000,000 | $ 80,000,000 |
Debt - Derivatives (Details)
Debt - Derivatives (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Sep. 26, 2021 | Sep. 14, 2021 |
Interest rate swap, April 2018, 2.33% fixed | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 55 | ||
Interest rate swap agreement, fixed interest rate | 2.33% | ||
Interest rate swap, April 2018, 2.36% fixed | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 35 | ||
Interest rate swap agreement, fixed interest rate | 2.36% | ||
Interest rate swap, April 2018, 2.34% fixed | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 35 | ||
Interest rate swap agreement, fixed interest rate | 2.34% | ||
Interest rate swap, January 2018, 1.99% fixed, $100 million notional amount | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 100 | ||
Interest rate swap agreement, fixed interest rate | 1.99% | ||
Interest rate swap, January 2018, 1.99% fixed, $75 million notional amount | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 75 | ||
Interest rate swap agreement, fixed interest rate | 1.99% | ||
Interest rate swap, January 2018, 2.00% fixed, $50 Million notional amount | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 50 | ||
Interest rate swap agreement, fixed interest rate | 2.00% | ||
Interest rate swap | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 350 | ||
Notes | |||
Interest rate swaps | |||
Fixed interest rate | 3.875% | 3.875% | |
Not designated as a hedge | Interest rate swap | |||
Interest rate swaps | |||
Interest rate swap agreement, notional amount | $ 350 |
Debt - Interest Rate Swaps (Det
Debt - Interest Rate Swaps (Details) - Interest rate swap - Other current and long-term Liabilities - USD ($) $ in Thousands | Sep. 26, 2021 | Dec. 27, 2020 |
Designated as a hedge | ||
Debt and Credit Arrangements | ||
Derivatives, fair value | $ 13,452 | |
Not designated as a hedge | ||
Debt and Credit Arrangements | ||
Derivatives, fair value | $ 8,162 |
Debt - Effect of Derivatives on
Debt - Effect of Derivatives on Financial Statements (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | |
Debt and Credit Arrangements | ||||
Total net interest expense on Consolidated Statements of Operations | $ (3,979) | $ (3,636) | $ (11,275) | $ (11,230) |
Interest paid, including payments made or received under the swaps | 4,100 | 3,900 | 11,100 | 12,000 |
Interest expense | Interest rate swap | ||||
Debt and Credit Arrangements | ||||
Amount of Gain or (Loss) Recognized in AOCI/AOCL on Derivative | 1,182 | 1,268 | 3,963 | (7,219) |
Amount of Gain or (Loss) Reclassified from AOCI/AOCL into Income | (1,644) | (1,674) | (5,084) | (3,376) |
Total net interest expense on Consolidated Statements of Operations | $ 3,979 | $ 3,636 | $ 11,275 | $ 11,230 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Durling et al v. Papa John's International, Inc. | Sep. 26, 2021USD ($) | Oct. 29, 2018employee |
Loss Contingencies [Line Items] | ||
Approximate number of employees who opted into the class action | employee | 9,571 | |
Expected future costs | $ | $ 0 |
Strategic Corporate Reorganiz_3
Strategic Corporate Reorganization for Long-term Growth (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 26, 2021 | Sep. 26, 2021 | Dec. 26, 2021 | |
New Corporate Headquarters | |||
Restructuring costs | $ 15,300 | ||
Restructuring Reserve [Roll Forward] | |||
Restructuring reserve, beginning balance | $ 4,861 | ||
Charges | 9,364 | ||
Payments | (12,237) | ||
Restructuring reserve, ending balance | 1,988 | 1,988 | |
Employee severance and other employee transition costs | |||
New Corporate Headquarters | |||
Restructuring costs | 8,300 | ||
Restructuring Reserve [Roll Forward] | |||
Restructuring reserve, beginning balance | 4,615 | ||
Charges | 3,576 | ||
Payments | (7,235) | ||
Restructuring reserve, ending balance | 956 | 956 | |
Recruiting and professional fees | |||
New Corporate Headquarters | |||
Restructuring costs | 4,000 | ||
Restructuring Reserve [Roll Forward] | |||
Restructuring reserve, beginning balance | 145 | ||
Charges | 2,431 | ||
Payments | (2,576) | ||
Relocation costs | |||
New Corporate Headquarters | |||
Restructuring costs | 2,900 | ||
Restructuring Reserve [Roll Forward] | |||
Restructuring reserve, beginning balance | 101 | ||
Charges | 2,608 | ||
Payments | (1,677) | ||
Restructuring reserve, ending balance | 1,032 | 1,032 | |
Other costs | |||
New Corporate Headquarters | |||
Restructuring costs | 1,000 | ||
Restructuring Reserve [Roll Forward] | |||
Charges | 749 | ||
Payments | $ (749) | ||
Stock-based compensation benefit | |||
New Corporate Headquarters | |||
Restructuring costs | $ (900) | ||
Forecast | Minimum | |||
New Corporate Headquarters | |||
Reorganizational expected costs | $ 2,000 | ||
Forecast | Maximum | |||
New Corporate Headquarters | |||
Reorganizational expected costs | 5,000 | ||
Forecast | One-time corporate reorganization costs | Minimum | |||
New Corporate Headquarters | |||
Reorganizational expected costs | 17,000 | ||
Forecast | One-time corporate reorganization costs | Maximum | |||
New Corporate Headquarters | |||
Reorganizational expected costs | $ 20,000 |
Segment Information - Concentra
Segment Information - Concentration (Details) | 9 Months Ended |
Sep. 26, 2021entitysegment | |
Major customers disclosures | |
Number of reportable segments | segment | 4 |
Consolidated revenues | |
Major customers disclosures | |
Concentration risk, number | entity | 0 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information, by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | Dec. 27, 2020 | |
Segment Information | |||||
Total revenues | $ 512,782 | $ 472,941 | $ 1,539,536 | $ 1,343,423 | |
Operating income | 38,577 | 24,549 | 130,076 | 70,555 | |
Income before income taxes | 34,598 | 20,913 | 118,801 | 59,325 | |
Accumulated depreciation and amortization | (522,708) | (522,708) | |||
Property and equipment, net | 209,072 | 209,072 | $ 200,895 | ||
Domestic Company-owned restaurants | |||||
Segment Information | |||||
Total revenues | 191,584 | 178,371 | 584,942 | 526,317 | |
North America commissary | |||||
Segment Information | |||||
Total revenues | 189,224 | 181,338 | 560,743 | 504,379 | |
North America commissaries | |||||
Segment Information | |||||
Total revenues | 189,224 | 181,338 | 560,743 | 504,379 | |
North America franchising | |||||
Segment Information | |||||
Total revenues | 31,933 | 25,281 | 97,123 | 68,895 | |
International | |||||
Segment Information | |||||
Total revenues | 38,408 | 33,440 | 110,629 | 87,592 | |
Other segment | |||||
Segment Information | |||||
Total revenues | 61,633 | 54,511 | 186,099 | 156,240 | |
Operating segments | |||||
Segment Information | |||||
Total revenues | 512,782 | 472,941 | 1,539,536 | 1,343,423 | |
Operating segments | Domestic Company-owned restaurants | |||||
Segment Information | |||||
Total revenues | 191,584 | 178,371 | 584,942 | 526,317 | |
Operating income | 9,480 | 8,439 | 40,165 | 33,852 | |
Property and equipment, gross | 237,155 | 237,155 | |||
Operating segments | North America commissary | |||||
Segment Information | |||||
Total revenues | 189,224 | 181,338 | 560,743 | 504,379 | |
Operating income | 9,598 | 8,208 | 29,089 | 24,579 | |
Property and equipment, gross | 147,186 | 147,186 | |||
Operating segments | North America commissaries | |||||
Segment Information | |||||
Total revenues | 189,224 | 181,338 | 560,743 | 504,379 | |
Operating segments | North America franchising | |||||
Segment Information | |||||
Total revenues | 31,933 | 25,281 | 97,123 | 68,895 | |
Operating income | 29,830 | 23,353 | 90,791 | 62,855 | |
Operating segments | International | |||||
Segment Information | |||||
Total revenues | 46,880 | 40,328 | 135,761 | 106,846 | |
Operating income | 9,618 | 7,986 | 26,665 | 16,836 | |
Property and equipment, gross | 15,026 | 15,026 | |||
Operating segments | Other segment | |||||
Segment Information | |||||
Total revenues | 53,161 | 47,623 | 160,967 | 136,986 | |
Operating income | 3,848 | 3,193 | 14,860 | 5,030 | |
Property and equipment, gross | 103,054 | 103,054 | |||
Elimination | |||||
Segment Information | |||||
Total revenues | (73,013) | (78,298) | (218,703) | (210,969) | |
Operating income | (639) | 291 | (557) | (619) | |
Elimination | North America commissary | |||||
Segment Information | |||||
Total revenues | (53,454) | (50,306) | (158,952) | (142,169) | |
Elimination | North America commissaries | |||||
Segment Information | |||||
Total revenues | (53,454) | (50,306) | (158,952) | (142,169) | |
Elimination | North America franchising | |||||
Segment Information | |||||
Total revenues | (1,037) | (824) | (3,138) | (2,291) | |
Elimination | Other segment | |||||
Segment Information | |||||
Total revenues | (18,522) | (27,168) | (56,613) | (66,509) | |
Unallocated corporate | |||||
Segment Information | |||||
Operating income | (23,158) | $ (26,921) | (70,937) | $ (71,978) | |
Property and equipment, gross | $ 229,359 | $ 229,359 |
Segment Information - Disaggreg
Segment Information - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2021 | Sep. 27, 2020 | Sep. 26, 2021 | Sep. 27, 2020 | |
Revenue disaggregation | ||||
Total revenues | $ 512,782 | $ 472,941 | $ 1,539,536 | $ 1,343,423 |
Domestic Company-owned restaurants | ||||
Revenue disaggregation | ||||
Total revenues | 191,584 | 178,371 | 584,942 | 526,317 |
North America franchising | ||||
Revenue disaggregation | ||||
Total revenues | 31,933 | 25,281 | 97,123 | 68,895 |
North America commissaries | ||||
Revenue disaggregation | ||||
Total revenues | 189,224 | 181,338 | 560,743 | 504,379 |
International. | ||||
Revenue disaggregation | ||||
Total revenues | 38,408 | 33,440 | 110,629 | 87,592 |
International. | International other revenue | ||||
Revenue disaggregation | ||||
Total revenues | (8,472) | (6,888) | (25,132) | (19,254) |
All others | ||||
Revenue disaggregation | ||||
Total revenues | 61,633 | 54,511 | 186,099 | 156,240 |
All others | International other revenue | ||||
Revenue disaggregation | ||||
Total revenues | 8,472 | 6,888 | 25,132 | 19,254 |
Operating segments | ||||
Revenue disaggregation | ||||
Total revenues | 512,782 | 472,941 | 1,539,536 | 1,343,423 |
Operating segments | Company-owned Restaurants | ||||
Revenue disaggregation | ||||
Total revenues | 191,584 | 178,371 | 584,942 | 526,317 |
Operating segments | Franchise royalties and fees | ||||
Revenue disaggregation | ||||
Total revenues | 47,001 | 36,808 | 139,657 | 99,148 |
Operating segments | Commissary Sales | ||||
Revenue disaggregation | ||||
Total revenues | 267,055 | 254,381 | 790,928 | 706,178 |
Operating segments | Other Sales | ||||
Revenue disaggregation | ||||
Total revenues | 80,155 | 81,679 | 242,712 | 222,749 |
Operating segments | Domestic Company-owned restaurants | ||||
Revenue disaggregation | ||||
Total revenues | 191,584 | 178,371 | 584,942 | 526,317 |
Operating segments | Domestic Company-owned restaurants | Company-owned Restaurants | ||||
Revenue disaggregation | ||||
Total revenues | 191,584 | 178,371 | 584,942 | 526,317 |
Operating segments | North America franchising | ||||
Revenue disaggregation | ||||
Total revenues | 31,933 | 25,281 | 97,123 | 68,895 |
Operating segments | North America franchising | Franchise royalties and fees | ||||
Revenue disaggregation | ||||
Total revenues | 32,970 | 26,105 | 100,261 | 71,186 |
Operating segments | North America commissaries | ||||
Revenue disaggregation | ||||
Total revenues | 189,224 | 181,338 | 560,743 | 504,379 |
Operating segments | North America commissaries | Commissary Sales | ||||
Revenue disaggregation | ||||
Total revenues | 242,678 | 231,644 | 719,695 | 646,548 |
Operating segments | International. | ||||
Revenue disaggregation | ||||
Total revenues | 46,880 | 40,328 | 135,761 | 106,846 |
Other revenue from marketing fund contributions and sublease rental income | 8,500 | 6,900 | 25,100 | 19,300 |
Operating segments | International. | Franchise royalties and fees | ||||
Revenue disaggregation | ||||
Total revenues | 14,031 | 10,703 | 39,396 | 27,962 |
Operating segments | International. | Commissary Sales | ||||
Revenue disaggregation | ||||
Total revenues | 24,377 | 22,737 | 71,233 | 59,630 |
Operating segments | International. | Other Sales | ||||
Revenue disaggregation | ||||
Total revenues | 8,472 | 6,888 | 25,132 | 19,254 |
Operating segments | All others | ||||
Revenue disaggregation | ||||
Total revenues | 53,161 | 47,623 | 160,967 | 136,986 |
Operating segments | All others | Other Sales | ||||
Revenue disaggregation | ||||
Total revenues | 71,683 | 74,791 | 217,580 | 203,495 |
Elimination | ||||
Revenue disaggregation | ||||
Total revenues | (73,013) | (78,298) | (218,703) | (210,969) |
Elimination | North America franchising | ||||
Revenue disaggregation | ||||
Total revenues | (1,037) | (824) | (3,138) | (2,291) |
Elimination | North America commissaries | ||||
Revenue disaggregation | ||||
Total revenues | (53,454) | (50,306) | (158,952) | (142,169) |
Elimination | All others | ||||
Revenue disaggregation | ||||
Total revenues | $ (18,522) | $ (27,168) | $ (56,613) | $ (66,509) |