UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q
(Mark One) 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended JuneMarch 26, 20222023
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from ______ to ______
Commission File Number: 001-35625

blmnlogov3.jpg

BLOOMIN’ BRANDS, INC.
(Exact name of registrant as specified in its charter)
Delaware20-8023465
(State or other jurisdiction of incorporation or organization)(IRS Employer Identification No.)
2202 North West Shore Boulevard, Suite 500, Tampa, FL 33607
(Address of principal executive offices) (Zip Code)

(813) 282-1225
(Registrant’s telephone number, including area code)

N/A
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock$0.01 par valueBLMN
The Nasdaq Stock Market LLC
(Nasdaq Global Select Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes   No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer Accelerated filer  Non-accelerated filer
Smaller reporting company Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes   No  

As of July 28, 2022, 89,297,078April 27, 2023, 87,293,770 shares of common stock of the registrant were outstanding.


Table of Contents
BLOOMIN’ BRANDS, INC.


INDEX TO QUARTERLY REPORT ON FORM 10-Q
For the Quarterly Period Ended JuneMarch 26, 20222023
(Unaudited)

TABLE OF CONTENTS

 Page No.
Item 1.
 
  
 
 
   
 
Item 2.
Item 3.
Item 4.
 
Item 1.
Item 1A.
Item 2.
Item 6.
  
 
2

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BLOOMIN’ BRANDS, INC.

PART I: FINANCIAL INFORMATION

Item 1. Financial Statements

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA, UNAUDITED)DATA) 

MARCH 26, 2023DECEMBER 25, 2022
JUNE 26, 2022DECEMBER 26, 2021(UNAUDITED)
ASSETSASSETS  ASSETS  
Current assetsCurrent assets  Current assets  
Cash and cash equivalentsCash and cash equivalents$95,346 $87,585 Cash and cash equivalents$94,441 $84,735 
Restricted cash and cash equivalents101 1,472 
InventoriesInventories80,482 79,112 Inventories67,898 78,124 
Other current assets, netOther current assets, net116,997 184,623 Other current assets, net85,507 183,718 
Total current assetsTotal current assets292,926 352,792 Total current assets247,846 346,577 
Property, fixtures and equipment, netProperty, fixtures and equipment, net852,155 842,012 Property, fixtures and equipment, net936,225 914,142 
Operating lease right-of-use assetsOperating lease right-of-use assets1,122,317 1,130,873 Operating lease right-of-use assets1,091,943 1,103,083 
GoodwillGoodwill278,780 268,444 Goodwill272,510 273,032 
Intangible assets, netIntangible assets, net452,654 453,412 Intangible assets, net446,696 448,326 
Deferred income tax assets, netDeferred income tax assets, net158,110 168,068 Deferred income tax assets, net151,436 153,118 
Other assets, netOther assets, net73,053 78,670 Other assets, net85,137 82,147 
Total assetsTotal assets$3,229,995 $3,294,271 Total assets$3,231,793 $3,320,425 
LIABILITIES AND STOCKHOLDERS’ EQUITYLIABILITIES AND STOCKHOLDERS’ EQUITY  LIABILITIES AND STOCKHOLDERS’ EQUITY  
Current liabilitiesCurrent liabilities  Current liabilities  
Accounts payableAccounts payable$185,645 $167,978 Accounts payable$196,093 $183,715 
Accrued and other current liabilitiesAccrued and other current liabilities412,831 406,894 Accrued and other current liabilities399,465 399,301 
Unearned revenueUnearned revenue309,863 398,795 Unearned revenue322,608 394,215 
Current portion of long-term debtCurrent portion of long-term debt1,511 10,958 Current portion of long-term debt2,267 1,636 
Total current liabilitiesTotal current liabilities909,850 984,625 Total current liabilities920,433 978,867 
Non-current operating lease liabilitiesNon-current operating lease liabilities1,168,692 1,179,447 Non-current operating lease liabilities1,136,694 1,148,607 
Long-term debt, netLong-term debt, net800,222 782,107 Long-term debt, net765,702 831,656 
Other long-term liabilities, netOther long-term liabilities, net88,490 125,242 Other long-term liabilities, net86,123 87,386 
Total liabilitiesTotal liabilities2,967,254 3,071,421 Total liabilities2,908,952 3,046,516 
Commitments and contingencies (Note 15)00
Commitments and contingencies (Note 12)Commitments and contingencies (Note 12)
Stockholders’ equityStockholders’ equityStockholders’ equity
Bloomin’ Brands stockholders’ equityBloomin’ Brands stockholders’ equityBloomin’ Brands stockholders’ equity
Preferred stock, $0.01 par value, 25,000,000 shares authorized; no shares issued and outstanding as of June 26, 2022 and December 26, 2021— — 
Common stock, $0.01 par value, 475,000,000 shares authorized; 90,151,164 and 89,252,823 shares issued and outstanding as of June 26, 2022 and December 26, 2021, respectively902 893 
Preferred stock, $0.01 par value, 25,000,000 shares authorized; no shares issued and outstanding as of March 26, 2023 and December 25, 2022Preferred stock, $0.01 par value, 25,000,000 shares authorized; no shares issued and outstanding as of March 26, 2023 and December 25, 2022— — 
Common stock, $0.01 par value, 475,000,000 shares authorized; 87,465,214 and 87,696,200 shares issued and outstanding as of March 26, 2023 and December 25, 2022, respectivelyCommon stock, $0.01 par value, 475,000,000 shares authorized; 87,465,214 and 87,696,200 shares issued and outstanding as of March 26, 2023 and December 25, 2022, respectively875 877 
Additional paid-in capitalAdditional paid-in capital1,169,697 1,119,728 Additional paid-in capital1,141,017 1,161,912 
Accumulated deficitAccumulated deficit(733,723)(698,171)Accumulated deficit(635,451)(706,109)
Accumulated other comprehensive lossAccumulated other comprehensive loss(176,054)(205,989)Accumulated other comprehensive loss(186,445)(185,311)
Total Bloomin’ Brands stockholders’ equityTotal Bloomin’ Brands stockholders’ equity260,822 216,461 Total Bloomin’ Brands stockholders’ equity319,996 271,369 
Noncontrolling interestsNoncontrolling interests1,919 6,389 Noncontrolling interests2,845 2,540 
Total stockholders’ equityTotal stockholders’ equity262,741 222,850 Total stockholders’ equity322,841 273,909 
Total liabilities and stockholders’ equityTotal liabilities and stockholders’ equity$3,229,995 $3,294,271 Total liabilities and stockholders’ equity$3,231,793 $3,320,425 
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these unaudited consolidated financial statements.The accompanying notes are an integral part of these unaudited consolidated financial statements.
3

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BLOOMIN’ BRANDS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA, UNAUDITED)


THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021MARCH 26, 2023MARCH 27, 2022
RevenuesRevenues    Revenues  
Restaurant salesRestaurant sales$1,108,918 $1,055,227 $2,232,493 $2,034,678 Restaurant sales$1,228,234 $1,123,575 
Franchise and other revenuesFranchise and other revenues16,244 22,139 33,204 30,161 Franchise and other revenues16,512 16,960 
Total revenuesTotal revenues1,125,162 1,077,366 2,265,697 2,064,839 Total revenues1,244,746 1,140,535 
Costs and expensesCosts and expenses    Costs and expenses  
Food and beverage costs364,459 312,102 723,829 603,972 
Food and beverageFood and beverage384,214 359,370 
Labor and other relatedLabor and other related308,759 294,999 621,270 569,637 Labor and other related341,542 312,511 
Other restaurant operatingOther restaurant operating263,529 233,450 522,639 462,743 Other restaurant operating282,927 259,110 
Depreciation and amortizationDepreciation and amortization41,257 40,539 83,032 81,765 Depreciation and amortization46,302 41,775 
General and administrativeGeneral and administrative59,246 66,462 117,920 123,710 General and administrative65,804 58,674 
Provision for impaired assets and restaurant closingsProvision for impaired assets and restaurant closings193 5,177 2,032 7,377 Provision for impaired assets and restaurant closings3,324 1,839 
Total costs and expensesTotal costs and expenses1,037,443 952,729 2,070,722 1,849,204 Total costs and expenses1,124,113 1,033,279 
Income from operationsIncome from operations87,719 124,637 194,975 215,635 Income from operations120,633 107,256 
Loss on extinguishment and modification of debt(107,630)(2,073)(107,630)(2,073)
Loss on fair value adjustment of derivatives, net(17,685)— (17,685)— 
Other income, net— — — 21 
Interest expense, net(12,548)(14,990)(26,181)(29,618)
(Loss) income before provision for income taxes(50,144)107,574 43,479 183,965 
Provision for income taxes11,536 22,688 27,465 29,281 
Net (loss) income(61,680)84,886 16,014 154,684 
Less: net income attributable to noncontrolling interests1,955 2,341 4,138 3,277 
Net (loss) income attributable to Bloomin’ Brands$(63,635)$82,545 $11,876 $151,407 
Net (loss) income$(61,680)$84,886 $16,014 $154,684 
Other comprehensive (loss) income:
Interest expense, netInterest expense, net(12,444)(13,633)
Income before provision for income taxesIncome before provision for income taxes108,189 93,623 
Provision for income taxesProvision for income taxes14,761 15,929 
Net incomeNet income93,428 77,694 
Less: net income attributable to noncontrolling interestsLess: net income attributable to noncontrolling interests2,117 2,183 
Net income attributable to Bloomin’ BrandsNet income attributable to Bloomin’ Brands$91,311 $75,511 
Net incomeNet income$93,428 $77,694 
Other comprehensive income:Other comprehensive income:
Foreign currency translation adjustmentForeign currency translation adjustment11,940 10,015 23,223 3,440 Foreign currency translation adjustment(1,134)11,283 
Unrealized (loss) gain on derivatives, net of tax— (128)573 (170)
Reclassification of adjustments for loss on derivatives included in Net (loss) income, net of tax273 1,514 954 4,517 
Impact of terminated interest rate swaps included in Net (loss) income, net of tax2,164 1,471 5,185 1,471 
Comprehensive (loss) income(47,303)97,758 45,949 163,942 
Unrealized gain on derivatives, net of taxUnrealized gain on derivatives, net of tax— 573 
Reclassification of adjustments for loss on derivatives included in Net income, net of taxReclassification of adjustments for loss on derivatives included in Net income, net of tax— 681 
Impact of terminated interest rate swaps included in Net income, net of taxImpact of terminated interest rate swaps included in Net income, net of tax— 3,021 
Comprehensive incomeComprehensive income92,294 93,252 
Less: comprehensive income attributable to noncontrolling interestsLess: comprehensive income attributable to noncontrolling interests1,955 2,341 4,138 3,277 Less: comprehensive income attributable to noncontrolling interests2,117 2,183 
Comprehensive (loss) income attributable to Bloomin’ Brands$(49,258)$95,417 $41,811 $160,665 
Comprehensive income attributable to Bloomin’ BrandsComprehensive income attributable to Bloomin’ Brands$90,177 $91,069 
(Loss) earnings per share:
Earnings per share:Earnings per share:
BasicBasic$(0.72)$0.93 $0.13 $1.71 Basic$1.02 $0.85 
DilutedDiluted$(0.72)$0.75 $0.12 $1.38 Diluted$0.93 $0.73 
Weighted average common shares outstanding:Weighted average common shares outstanding:Weighted average common shares outstanding:
BasicBasic88,898 89,075 89,127 88,721 Basic89,116 89,355 
DilutedDiluted88,898 109,805 102,045 110,223 Diluted98,011 103,454 
 
The accompanying notes are an integral part of these unaudited consolidated financial statements.
4

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BLOOMIN’ BRANDS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(IN THOUSANDS, EXCEPT PER SHARE DATA, UNAUDITED)
BLOOMIN’ BRANDS, INC.
COMMON STOCKADDITIONAL PAID-IN CAPITALACCUM-
ULATED DEFICIT
ACCUMULATED OTHER
COMPREHENSIVE LOSS
NON-CONTROLLING INTERESTSTOTAL
SHARESAMOUNT
Balance,
March 27, 2022
89,185 $892 $1,115,458 $(634,356)$(190,431)$1,694 $293,257 
Net (loss) income— — — (63,635)— 1,955 (61,680)
Other comprehensive income, net of tax— — — — 14,377 — 14,377 
Cash dividends declared, $0.14 per common share— — (12,418)— — — (12,418)
Repurchase and retirement of common stock(1,761)(17)— (35,732)— — (35,749)
Stock-based compensation— — 4,959 — — — 4,959 
Common stock issued under stock plans (1)414 1,118 — — — 1,122 
Purchase of noncontrolling interests, net of tax of $1,142— — (3,301)— — 539 (2,762)
Distributions to noncontrolling interests— — — — — (2,513)(2,513)
Contributions from noncontrolling interests— — — — — 244 244 
Retirement of convertible senior note hedges— — 112,956 — — — 112,956 
Retirement of warrants— — (97,617)— — — (97,617)
Issuance of common stock from repurchase of convertible senior notes2,313 23 48,542 — — — 48,565 
Balance,
June 26, 2022
90,151 $902 $1,169,697 $(733,723)$(176,054)$1,919 $262,741 
Balance,
December 26, 2021
89,253 $893 $1,119,728 $(698,171)$(205,989)$6,389 $222,850 
Net income— — — 11,876 — 4,138 16,014 
Other comprehensive income, net of tax— — — — 29,935 — 29,935 
Cash dividends declared, $0.28 per common share— — (24,977)— — — (24,977)
Repurchase and retirement of common stock(2,312)(23)— (47,428)— — (47,451)
Stock-based compensation— — 9,802 — — — 9,802 
Common stock issued under stock plans (1)897 1,998 — — — 2,007 
Purchase of noncontrolling interests, net of tax of $254— — (735)— — (3,915)(4,650)
Distributions to noncontrolling interests— — — — — (5,154)(5,154)
Contributions from noncontrolling interests— — — — — 461 461 
Retirement of convertible senior note hedges— — 112,956 — — — 112,956 
Retirement of warrants— — (97,617)— — — (97,617)
Issuance of common stock from repurchase of convertible senior notes2,313 23 48,542 — — — 48,565 
Balance,
June 26, 2022
90,151 $902 $1,169,697 $(733,723)$(176,054)$1,919 $262,741 
BLOOMIN’ BRANDS, INC.
COMMON STOCKADDITIONAL PAID-IN CAPITALACCUM-
ULATED DEFICIT
ACCUMULATED OTHER
COMPREHENSIVE LOSS
NON-CONTROLLING INTERESTSTOTAL
SHARESAMOUNT
Balance,
December 25, 2022
87,696 $877 $1,161,912 $(706,109)$(185,311)$2,540 $273,909 
Net income— — — 91,311 — 2,117 93,428 
Other comprehensive loss— — — — (1,134)— (1,134)
Cash dividends declared, $0.24 per common share— — (21,014)— — — (21,014)
Repurchase and retirement of common stock, including excise tax(863)(9)— (20,653)— — (20,662)
Stock-based compensation— — 2,904 — — — 2,904 
Common stock issued under stock plans (1)632 (2,785)— — — (2,778)
Distributions to noncontrolling interests— — — — — (2,555)(2,555)
Contributions from noncontrolling interests— — — — — 743 743 
Balance,
March 26, 2023
87,465 $875 $1,141,017 $(635,451)$(186,445)$2,845 $322,841 
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BLOOMIN’ BRANDS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(IN THOUSANDS, EXCEPT PER SHARE DATA, UNAUDITED)
BLOOMIN’ BRANDS, INC.
COMMON STOCKADDITIONAL PAID-IN CAPITALACCUM-
ULATED DEFICIT
ACCUMULATED OTHER
COMPREHENSIVE LOSS
NON-CONTROLLING INTERESTSTOTAL
SHARESAMOUNT
Balance,
March 28, 2021
88,855 $889 $1,097,639 $(844,864)$(215,060)$6,801 $45,405 
Net income— — — 82,545 — 2,341 84,886 
Other comprehensive income, net of tax— — — — 12,872 — 12,872 
Stock-based compensation— — 9,781 — — — 9,781 
Common stock issued under stock plans (1)356 2,484 — — — 2,487 
Distributions to noncontrolling interests— — — — — (2,683)(2,683)
Contributions from noncontrolling interests— — — — — 159 159 
Balance,
June 27, 2021
89,211 $892 $1,109,904 $(762,319)$(202,188)$6,618 $152,907 
Balance,
December 27, 2020
87,856 $879 $1,132,808 $(918,096)$(211,446)$6,812 $10,957 
Cumulative-effect from a change in accounting principle, net of tax— — (47,323)4,370 — — (42,953)
Net income— — — 151,407 — 3,277 154,684 
Other comprehensive income, net of tax— — — — 9,258 — 9,258 
Stock-based compensation— 14,507 — — — 14,507 
Common stock issued under stock plans (1)1,355 13 9,912 — — — 9,925 
Distributions to noncontrolling interests— — — — — (4,141)(4,141)
Contributions from noncontrolling interests— — — —��— 670 670 
Balance,
June 27, 2021
89,211 $892 $1,109,904 $(762,319)$(202,188)$6,618 $152,907 
BLOOMIN’ BRANDS, INC.
COMMON STOCKADDITIONAL PAID-IN CAPITALACCUM-
ULATED DEFICIT
ACCUMULATED OTHER
COMPREHENSIVE LOSS
NON-CONTROLLING INTERESTSTOTAL
SHARESAMOUNT
Balance,
December 26, 2021
Balance,
December 26, 2021
89,253 $893 $1,119,728 $(698,171)$(205,989)$6,389 $222,850 
Net incomeNet income— — — 75,511 — 2,183 77,694 
Other comprehensive income, net of taxOther comprehensive income, net of tax— — — — 15,558 — 15,558 
Cash dividends declared, $0.14 per common shareCash dividends declared, $0.14 per common share— — (12,559)— — — (12,559)
Repurchase and retirement of common stockRepurchase and retirement of common stock(551)(6)— (11,696)— — (11,702)
Stock-based compensationStock-based compensation— — 4,843 — — — 4,843 
Common stock issued under stock plans (1)Common stock issued under stock plans (1)483 880 — — — 885 
Purchase of noncontrolling interests, net of tax of $888Purchase of noncontrolling interests, net of tax of $888— — 2,566 — — (4,454)(1,888)
Distributions to noncontrolling interestsDistributions to noncontrolling interests— — — — — (2,641)(2,641)
Contributions from noncontrolling interestsContributions from noncontrolling interests— — — — — 217 217 
Balance,
March 27, 2022
Balance,
March 27, 2022
89,185 $892 $1,115,458 $(634,356)$(190,431)$1,694 $293,257 
________________
(1)Net of forfeitures and shares withheld for employee taxes.

The accompanying notes are an integral part of these unaudited consolidated financial statements.
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BLOOMIN’ BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS, UNAUDITED)

TWENTY-SIX WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021
Cash flows provided by operating activities:  
Net income$16,014 $154,684 
Adjustments to reconcile Net income to cash provided by operating activities:  
Depreciation and amortization83,032 81,765 
Amortization of debt discounts and issuance costs2,025 2,396 
Amortization of deferred gift card sales commissions13,458 14,436 
Provision for impaired assets and restaurant closings2,032 7,377 
Non-cash interest expense from terminated interest rate swaps6,980 1,981 
Non-cash operating lease costs41,336 38,073 
Stock-based and other non-cash compensation expense9,802 14,507 
Deferred income tax expense8,329 10,300 
Loss on extinguishment and modification of debt107,630 2,073 
Loss on fair value adjustment of derivatives, net17,685 — 
Other, net4,935 (1,343)
Change in assets and liabilities(94,440)(43,067)
Net cash provided by operating activities218,818 283,182 
Cash flows used in investing activities:  
Proceeds from disposal of property, fixtures and equipment163 4,828 
Capital expenditures(76,901)(51,398)
Other investments, net1,000 3,945 
Net cash used in investing activities$(75,738)$(42,625)
(CONTINUED...)
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BLOOMIN’ BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS, UNAUDITED)

TWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021MARCH 26, 2023MARCH 27, 2022
Cash flows provided by operating activities:Cash flows provided by operating activities:  
Net incomeNet income$93,428 $77,694 
Adjustments to reconcile Net income to cash provided by operating activities:Adjustments to reconcile Net income to cash provided by operating activities:  
Depreciation and amortizationDepreciation and amortization46,302 41,775 
Amortization of debt discounts and issuance costsAmortization of debt discounts and issuance costs763 1,065 
Amortization of deferred gift card sales commissionsAmortization of deferred gift card sales commissions7,797 8,017 
Provision for impaired assets and restaurant closingsProvision for impaired assets and restaurant closings3,324 1,839 
Non-cash interest expense from terminated interest rate swapsNon-cash interest expense from terminated interest rate swaps— 4,067 
Non-cash operating lease costsNon-cash operating lease costs21,182 20,477 
Stock-based and other non-cash compensation expenseStock-based and other non-cash compensation expense2,904 4,843 
Deferred income tax expenseDeferred income tax expense1,682 3,209 
Other, netOther, net(1,823)2,229 
Change in assets and liabilitiesChange in assets and liabilities14,109 (18,080)
Net cash provided by operating activitiesNet cash provided by operating activities189,668 147,135 
Cash flows used in investing activities:Cash flows used in investing activities:  
Capital expendituresCapital expenditures(64,415)(40,180)
Other investments, netOther investments, net1,470 1,030 
Net cash used in investing activitiesNet cash used in investing activities(62,945)(39,150)
Cash flows used in financing activities:Cash flows used in financing activities:Cash flows used in financing activities:
Proceeds from issuance of long-term debt$— $200,000 
Repayments of long-term debt and finance lease obligationsRepayments of long-term debt and finance lease obligations(195,733)(425,564)Repayments of long-term debt and finance lease obligations(385)(2,863)
Proceeds from borrowings on revolving credit facilitiesProceeds from borrowings on revolving credit facilities624,500 286,000 Proceeds from borrowings on revolving credit facilities190,000 90,000 
Repayments of borrowings on revolving credit facilitiesRepayments of borrowings on revolving credit facilities(304,500)(599,000)Repayments of borrowings on revolving credit facilities(260,000)(160,000)
Financing fees(853)(5,868)
Proceeds from issuance of senior notes— 300,000 
Issuance costs related to senior notes— (5,546)
Repurchase of convertible senior notes(196,919)— 
Proceeds from retirement of convertible senior note hedges131,869 — 
Payments for retirement of warrants(114,825)— 
Proceeds from share-based compensation, net2,007 9,925 
(Payments of taxes) proceeds from share-based compensation, net(Payments of taxes) proceeds from share-based compensation, net(2,778)885 
Distributions to noncontrolling interestsDistributions to noncontrolling interests(5,154)(4,141)Distributions to noncontrolling interests(2,555)(2,641)
Contributions from noncontrolling interestsContributions from noncontrolling interests461 670 Contributions from noncontrolling interests743 217 
Purchase of noncontrolling interestsPurchase of noncontrolling interests(4,904)— Purchase of noncontrolling interests(100)(1,000)
Payments for partner equity planPayments for partner equity plan(5,743)(4,494)Payments for partner equity plan— (2,748)
Repurchase of common stockRepurchase of common stock(46,151)— Repurchase of common stock(20,898)(10,402)
Cash dividends paid on common stockCash dividends paid on common stock(24,977)— Cash dividends paid on common stock(21,014)(12,559)
Net cash used in financing activitiesNet cash used in financing activities(140,922)(248,018)Net cash used in financing activities(116,987)(101,111)
Effect of exchange rate changes on cash and cash equivalentsEffect of exchange rate changes on cash and cash equivalents4,232 128 Effect of exchange rate changes on cash and cash equivalents(30)1,965 
Net increase (decrease) in cash, cash equivalents and restricted cash6,390 (7,333)
Net increase in cash, cash equivalents and restricted cashNet increase in cash, cash equivalents and restricted cash9,706 8,839 
Cash, cash equivalents and restricted cash as of the beginning of the periodCash, cash equivalents and restricted cash as of the beginning of the period89,057 110,408 Cash, cash equivalents and restricted cash as of the beginning of the period84,735 89,057 
Cash, cash equivalents and restricted cash as of the end of the periodCash, cash equivalents and restricted cash as of the end of the period$95,447 $103,075 Cash, cash equivalents and restricted cash as of the end of the period$94,441 $97,896 
Supplemental disclosures of cash flow information:Supplemental disclosures of cash flow information:  Supplemental disclosures of cash flow information:  
Cash paid for interestCash paid for interest$18,862 $23,748 Cash paid for interest$6,528 $2,444 
Cash paid for income taxes, net of refundsCash paid for income taxes, net of refunds$17,191 $11,883 Cash paid for income taxes, net of refunds$2,458 $2,257 
Supplemental disclosures of non-cash investing and financing activities:Supplemental disclosures of non-cash investing and financing activities:  Supplemental disclosures of non-cash investing and financing activities:  
Leased assets obtained in exchange for new operating lease liabilitiesLeased assets obtained in exchange for new operating lease liabilities$26,415 $28,261 Leased assets obtained in exchange for new operating lease liabilities$11,394 $11,515 
Leased assets obtained in exchange for new finance lease liabilitiesLeased assets obtained in exchange for new finance lease liabilities$2,417 $48 Leased assets obtained in exchange for new finance lease liabilities$4,711 $1,313 
Increase (decrease) in liabilities from the acquisition of property, fixtures and equipmentIncrease (decrease) in liabilities from the acquisition of property, fixtures and equipment$2,545 $(203)Increase (decrease) in liabilities from the acquisition of property, fixtures and equipment$1,159 $(6,178)

The accompanying notes are an integral part of these unaudited consolidated financial statements.
















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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1.    Description of the Business and Basis of Presentation

Description of the Business - Bloomin’ Brands (“Bloomin’ Brands” or the “Company”) owns and operates casual, upscale casual and fine dining restaurants. The Company’s restaurant portfolio has 4four concepts: Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse & Wine Bar. Additional Outback Steakhouse, Carrabba’s Italian Grill and Bonefish Grill restaurants in which the Company has no direct investment are operated under franchise agreements.

Basis of Presentation - The accompanying interim unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles in the United States (“U.S. GAAP”) for complete financial statements. In the opinion of the Company, all adjustments necessary for fair financial statement presentation for the periods presented have been included and are of a normal, recurring nature. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 26, 2021.25, 2022.

Recently Issued Financial Accounting Standards Not Yet Adopted - In November 2021, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance” (“ASU No. 2021-10”), which requires financial statement footnote disclosure regarding government assistance accounted for by applying a grant or contribution accounting model by analogy. ASU No. 2021-10 is effective for the Company for the fiscal year ending December 25, 2022. Upon adoption of ASU No. 2021-10 during the fourth quarter of 2022, the Company anticipates government assistance financial statement footnote disclosures within the 2022 Form 10-K, primarily in connection with employee retention credits provided under the Coronavirus, Aid, Relief and Economic Security (“CARES”) Act.

Recent accounting guidance not discussed herein is not applicable, did not have or is not expected to have a material impact to the Company.

Reclassifications - The Company reclassified certain items in the accompanying consolidated financial statements for prior periods to be comparable with the classification for the current period, including, but not limited to, presentation of certain items within the condensed consolidated statements of cash flows and certain notes to the consolidated financial statements. These reclassifications had no effect on previously reported net income.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
2.    Revenue Recognition

The following table includes the categories of revenue included in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Revenues
Restaurant sales$1,108,918 $1,055,227 $2,232,493 $2,034,678 
Franchise and other revenues
Franchise revenues12,596 12,221 26,002 19,010 
Other revenues (1)3,648 9,918 7,202 11,151 
Total Franchise and other revenues16,244 22,139 33,204 30,161 
Total revenues$1,125,162 $1,077,366 $2,265,697 $2,064,839 
________________
(1)During the thirteen and twenty-six weeks ended June 27, 2021, the Company recognized $6.3 million of other revenues in connection with favorable court rulings in Brazil regarding the calculation methodology and taxable base of Program of Social Integration (“PIS”) and Contribution for the Financing of Social Security (“COFINS”) taxes. The amount recognized as a result of the favorable court rulings primarily represents refundable PIS and COFINS taxes for prior years, including accrued interest.
THIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Revenues
Restaurant sales$1,228,234 $1,123,575 
Franchise and other revenues
Franchise revenues13,523 13,406 
Other revenues2,989 3,554 
Total Franchise and other revenues16,512 16,960 
Total revenues$1,244,746 $1,140,535 

The following tables include the disaggregation of Restaurant sales and franchise revenues, by restaurant concept and major international market, for the periods indicated:
THIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021
(dollars in thousands)RESTAURANT SALESFRANCHISE REVENUESRESTAURANT SALESFRANCHISE REVENUES
U.S.
Outback Steakhouse$573,563 $8,156 $579,096 $8,418 
Carrabba’s Italian Grill170,190 797 171,408 665 
Bonefish Grill145,472 173 149,036 174 
Fleming’s Prime Steakhouse & Wine Bar93,933 — 88,101 — 
Other2,769 2,652 — 
U.S. total985,927 9,134 990,293 9,257 
International
Outback Steakhouse Brazil100,647 — 43,310 — 
Other (1)22,344 3,462 21,624 2,964 
International total122,991 3,462 64,934 2,964 
Total$1,108,918 $12,596 $1,055,227 $12,221 
________________
(1)Includes Restaurant sales for Company-owned Outback Steakhouse restaurants outside of Brazil and Abbraccio restaurants in Brazil. Franchise revenues primarily includes revenues from franchised Outback Steakhouse restaurants.
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
TWENTY-SIX WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021
(dollars in thousands)RESTAURANT SALESFRANCHISE REVENUESRESTAURANT SALESFRANCHISE REVENUES
U.S.
Outback Steakhouse$1,168,956 $16,615 $1,126,291 $11,374 
Carrabba’s Italian Grill345,818 1,458 329,094 1,282 
Bonefish Grill296,888 350 276,010 304 
Fleming’s Prime Steakhouse & Wine Bar191,595 — 154,412 — 
Other6,305 13 4,545 — 
U.S. total2,009,562 18,436 1,890,352 12,960 
International
Outback Steakhouse Brazil185,948 — 104,158 — 
Other (1)36,983 7,566 40,168 6,050 
International total222,931 7,566 144,326 6,050 
Total$2,232,493 $26,002 $2,034,678 $19,010 
The following table includes the disaggregation of Restaurant sales and franchise revenues, by restaurant concept and major international market, for the periods indicated:
THIRTEEN WEEKS ENDED
MARCH 26, 2023MARCH 27, 2022
(dollars in thousands)RESTAURANT SALESFRANCHISE REVENUESRESTAURANT SALESFRANCHISE REVENUES
U.S.
Outback Steakhouse$628,183 $8,544 $595,393 $8,459 
Carrabba’s Italian Grill188,042 795 175,628 661 
Bonefish Grill157,689 171 151,416 177 
Fleming’s Prime Steakhouse & Wine Bar102,773 — 97,662 — 
Other3,882 15 3,536 
U.S. total1,080,569 9,525 1,023,635 9,302 
International
Outback Steakhouse - Brazil (1)122,016 — 85,301 — 
Other (1)(2)25,649 3,998 14,639 4,104 
International total147,665 3,998 99,940 4,104 
Total$1,228,234 $13,523 $1,123,575 $13,406 
________________
(1)Restaurant sales in Brazil increased $9.6 million during the thirteen weeks ended March 26, 2023 in connection with value added tax exemptions resulting from recent tax legislation. See Note 11 - Income Taxes for details regarding the Brazil tax legislation.
(2)Includes Restaurant sales for Company-owned Outback Steakhouse restaurants outside of Brazil and Abbraccio restaurants in Brazil. Franchise revenues primarily includesinclude revenues from franchised Outback Steakhouse restaurants.

The following table includes a detail of assets and liabilities from contracts with customers included on the Company’s Consolidated Balance Sheets as of the periods indicated:
(dollars in thousands)(dollars in thousands)JUNE 26, 2022DECEMBER 26, 2021(dollars in thousands)MARCH 26, 2023DECEMBER 25, 2022
Other current assets, netOther current assets, netOther current assets, net
Deferred gift card sales commissionsDeferred gift card sales commissions$12,338 $17,793 Deferred gift card sales commissions$13,403 $17,755 
Unearned revenueUnearned revenueUnearned revenue
Deferred gift card revenueDeferred gift card revenue$303,544 $387,945 Deferred gift card revenue$314,096 $386,495 
Deferred loyalty revenueDeferred loyalty revenue4,309 9,386 Deferred loyalty revenue6,024 5,628 
Deferred franchise fees - currentDeferred franchise fees - current440 443 Deferred franchise fees - current471 460 
OtherOther1,570 1,021 Other2,017 1,632 
Total unearned revenue$309,863 $398,795 
Total Unearned revenueTotal Unearned revenue$322,608 $394,215 
Other long-term liabilities, netOther long-term liabilities, netOther long-term liabilities, net
Deferred franchise fees - non-currentDeferred franchise fees - non-current$4,185 $4,280 Deferred franchise fees - non-current$4,193 $4,126 

The following table is a rollforward of deferred gift card sales commissions for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Balance, beginning of the period$13,033 $13,502 $17,793 $19,300 
Deferred gift card sales commissions amortization(5,441)(5,711)(13,458)(14,436)
Deferred gift card sales commissions capitalization5,436 5,297 9,605 8,796 
Other(690)(540)(1,602)(1,112)
Balance, end of the period$12,338 $12,548 $12,338 $12,548 

THIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Balance, beginning of the period$17,755 $17,793 
Deferred gift card sales commissions amortization(7,797)(8,017)
Deferred gift card sales commissions capitalization4,403 4,169 
Other(958)(912)
Balance, end of the period$13,403 $13,033 
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
The following table is a rollforward of unearned gift card revenue for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Balance, beginning of the periodBalance, beginning of the period$314,974 $306,075 $387,945 $373,048 Balance, beginning of the period$386,495 $387,945 
Gift card salesGift card sales65,174 63,921 115,454 108,090 Gift card sales53,005 50,280 
Gift card redemptionsGift card redemptions(72,428)(71,859)(189,050)(176,799)Gift card redemptions(118,283)(116,622)
Gift card breakageGift card breakage(4,176)(4,182)(10,805)(10,384)Gift card breakage(7,121)(6,629)
Balance, end of the periodBalance, end of the period$303,544 $293,955 $303,544 $293,955 Balance, end of the period$314,096 $314,974 

3.    Impairments and Exit Costs

The components of Provision for impaired assets and restaurant closings are as follows for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 27, 2021JUNE 27, 2021
Impairment losses
U.S.$5,768 $7,174 
International(555)152 
Corporate209 238 
Total impairment losses5,422 7,564 
Restaurant closure benefits
U.S.(92)(34)
International(153)(153)
Total restaurant closure benefits(245)(187)
Provision for impaired assets and restaurant closings$5,177 $7,377 

Impairment and closure charges during the periods presented resulted primarily from locations identified for closure.

Annual Goodwill and Intangible Asset Impairment Assessment - The Company performs its annual assessment for impairment of goodwill and other indefinite-lived intangible assets during its second fiscal quarter. The Company’s 2022 and 2021 assessments were qualitative. In connection with these assessments, the Company did 0t record any impairment charges.

Accrued Facility Closure and Other Costs Rollforward - The following table is a rollforward of the Company’s closed facility lease liabilities and other accrued costs associated with the closure and restructuring initiatives, for the period indicated:
TWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022
Balance, beginning of the period$8,485 
Cash payments(2,308)
Accretion304 
Adjustments(323)
Balance, end of the period (1)$6,158 
________________
(1)As of June 26, 2022, the Company had exit-related accruals related to certain closure and restructuring initiatives of $1.6 million recorded in Accrued and other current liabilities and $4.6 million recorded in Non-current operating lease liabilities on its Consolidated Balance Sheet.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
4.    (Loss) Earnings Per Share

In February 2021, the Company provided the trustee of its convertible senior notes due in 2025 (the “2025 Notes”) notice of the Company’s irrevocable election to settle the principal portion of the 2025 Notes in cash and any excess in shares. As a result, subsequent to the election, only the amounts in excess of the principal amount are considered in diluted earnings per share. The amount of the 2025 Notes settled in shares of common stock will have a dilutive impact on diluted earnings per share when the average market price of the Company’s common stock for a given period exceeds the conversion price, which was initially $11.89 per share of common stock.

In connection with the offering of the 2025 Notes, the Company entered into warrant transactions (the “Warrant Transactions”), which have a dilutive effect on the Company’s common stock to the extent the price of its common stock exceeds the strike price of the Warrant Transactions, which was initially $16.64.

In connection with dividends paid during the twenty-six weeks ended June 26, 2022, the conversion price of the 2025 Notes decreased to $11.74 per share of common stock and the strike price of the related warrants decreased to $16.43 per share of common stock.

The following table presents the computation of basic and diluted (loss) earnings per share for the periods indicated:
THIRTEEN WEEKS ENDED
(in thousands, except per share data)MARCH 26, 2023MARCH 27, 2022
Net income attributable to Bloomin’ Brands$91,311 $75,511 
Basic weighted average common shares outstanding89,116 89,355 
Effect of dilutive securities:
Stock options401 370 
Nonvested restricted stock units269 279 
Nonvested performance-based share units286 276 
Convertible senior notes4,831 8,732 
Warrants3,108 4,442 
Diluted weighted average common shares outstanding98,011 103,454 
Basic earnings per share$1.02 $0.85 
Diluted earnings per share$0.93 $0.73 

THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(in thousands, except per share data)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Net (loss) income attributable to Bloomin’ Brands$(63,635)$82,545 $11,876 $151,407 
Convertible senior notes if-converted method interest adjustment, net of tax (1)— — — 691 
Diluted net (loss) income attributable to Bloomin’ Brands$(63,635)$82,545 $11,876 $152,098 
Basic weighted average common shares outstanding88,898 89,075 89,127 88,721 
Effect of dilutive securities:
Stock options— 1,165 305 937 
Nonvested restricted stock units— 351 192 427 
Nonvested performance-based share units— — 143 47 
Convertible senior notes (1)(2)— 11,231 8,253 13,212 
Warrants (2)— 7,983 4,025 6,879 
Diluted weighted average common shares outstanding88,898 109,805 102,045 110,223 
Basic (loss) earnings per share$(0.72)$0.93 $0.13 $1.71 
Diluted (loss) earnings per share$(0.72)$0.75 $0.12 $1.38 
________________
(1)Adjustment for interest related to the 2025 NotesShare-based compensation-related weighted for the portion of the period prior to the Company’s election under the 2025 Notes indenture to settle the principal portion of the 2025 Notesaverage securities outstanding not included in cash. Effective with the Company’s election, there will be no further numerator adjustments for interest or denominator adjustments for shares required to settle the principal portion.
(2)During the thirteen weeks ended June 26, 2022, the Company repurchased $125.0 million of the 2025 Notes and retired the corresponding portion of the related warrants. See Note 8 - Convertible Senior Notes for additional details. Due to the Company’s net loss during the thirteen weeks ended June 26, 2022, dilutive excess shares and warrants were excluded from the computation of diluted earnings per share asbecause their effect would be antidilutive.was antidilutive were as follows for the periods indicated:
THIRTEEN WEEKS ENDED
(shares in thousands)MARCH 26, 2023MARCH 27, 2022
Stock options725 1,417 
Nonvested restricted stock units120 217 
Nonvested performance-based share units344 365 


4.    Stock-based Compensation Plans


The Company recognized stock-based compensation expense as follows for the periods indicated:
THIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Performance-based share units$923 $2,619 
Restricted stock units1,963 1,810 
Stock options— 377 
$2,886 $4,806 
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Share-based compensation-related weighted average securities outstanding not included in the computation of (loss) earnings per share because their effect was antidilutive were as follows, for the periods indicated:

THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(shares in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Stock options2,563 — 1,870 682 
Nonvested restricted stock units485 299 41 
Nonvested performance-based share units596 465 475 448 

5.    Stock-based Compensation Plans

The Company recognized stock-based compensation expense as follows for the periods indicated:

THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Performance-based share units (1)$2,840 $7,318 $5,459 $8,787 
Restricted stock units2,027 1,964 3,837 4,330 
Stock options55 469 432 1,334 
$4,922 $9,751 $9,728 $14,451 
________________
(1)The thirteen and twenty-six weeks ended June 27, 2021 includes a cumulative life-to-date adjustment for PSUs granted in fiscal years 2019, 2020 and 2021 based on revised Company performance projections of performance criteria set forth in the award agreements.

In February 2022,2023, the Company granted 0.5 million performance-based share units (“PSUs”) subject to final payout modification by a Relative Total Shareholder Return (“Relative TSR”) modifier. This Relative TSR modifier can adjust the final payout outcome by 75%, 100% or 125% of the achieved performance metric, with the overall payout capped at 200% of the annual target grant. These PSUs have a three-year cliff vesting period and their fair value was estimated using the Monte Carlo simulation model.

The following table presents a summary of the Company’s PSU activity:
(in thousands, except per unit data)PERFORMANCE-BASED SHARE UNITSWEIGHTED AVERAGE GRANT DATE FAIR VALUE PER UNITAGGREGATE INTRINSIC VALUE (1)
Outstanding as of December 25, 2022874 $24.83 $18,323 
Granted301 $29.01 
Performance adjustment (2)154 $19.84 
Vested(470)$19.84 
Forfeited(32)$26.39 
Outstanding as of March 26, 2023827 $26.92 $20,630 
Expected to vest as of March 26, 20231,067 $26,611 
________________
(1)Based on the $20.96 and $24.94 share price of the Company’s common stock on December 23, 2022 and March 24, 2023, the last trading day of the year ended December 25, 2022 and the thirteen weeks ended March 26, 2023, respectively.
(2)Represents adjustment to 148% payout for PSUs granted during 2020.

Assumptions used in the Monte Carlo simulation model and the grant date fair value of PSUs granted were as follows for the periods indicated:
TWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021MARCH 26, 2023MARCH 27, 2022
Assumptions:Assumptions:Assumptions:
Risk-free interest rate (1)Risk-free interest rate (1)1.64 %0.20 %Risk-free interest rate (1)4.26 %1.64 %
Dividend yield (2)Dividend yield (2)2.31 %— %Dividend yield (2)3.47 %2.31 %
Volatility (3)Volatility (3)49.11 %48.45 %Volatility (3)51.02 %49.11 %
Grant date fair value per unit (4)Grant date fair value per unit (4)$26.10 $29.73 Grant date fair value per unit (4)$29.01 $26.10 
________________
(1)Risk-free interest rate is the U.S. Treasury yield curve in effect as of the grant date for the performance period of the unit.
(2)Dividend yield is the level of dividends expected to be paid on the Company’s common stock over the expected term.
(3)Based on the historical volatility of the Company’s stock over the last seven years.
(4)Represents a premium above the per share value of the Company’s common stock for the Relative TSR modifier as of the grant date of 2.7% and 7.9% as of March 26, 2023 and 14.3% for grants during the twenty-six weeks ended June 26,March 27, 2022, and June 27, 2021, respectively.

The following represents unrecognized stock-based compensation expense and the remaining weighted average vesting period as of March 26, 2023:
UNRECOGNIZED COMPENSATION EXPENSE
(dollars in thousands)
REMAINING WEIGHTED AVERAGE VESTING PERIOD (in years)
Performance-based share units$16,617 2.0
Restricted stock units$11,864 2.2

14
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
5.    Other Current Assets, Net

Other current assets, net, consisted of the following as of the periods indicated:
(dollars in thousands)MARCH 26, 2023DECEMBER 25, 2022
Prepaid expenses$27,856 $29,343 
Accounts receivable - gift cards, net8,515 85,606 
Accounts receivable - vendors, net10,209 25,385 
Accounts receivable - franchisees, net3,755 2,550 
Accounts receivable - other, net17,488 18,408 
Deferred gift card sales commissions13,403 17,755 
Other current assets, net4,281 4,671 
$85,507 $183,718 

6.    Long-term Debt, Net

Following is a summary of outstanding Long-term debt, net, as of the periods indicated:
MARCH 26, 2023DECEMBER 25, 2022
(dollars in thousands)OUTSTANDING BALANCEINTEREST RATEOUTSTANDING BALANCEINTEREST RATE
Senior secured credit facility - revolving credit facility (1)$360,000 6.28 %$430,000 5.79 %
2025 Notes105,000 5.00 %105,000 5.00 %
2029 Notes300,000 5.13 %300,000 5.13 %
Finance lease liabilities9,114 4,785 
Less: unamortized debt discount and issuance costs(6,145)(6,493)
Total debt, net767,969 833,292 
Less: current portion of long-term debt(2,267)(1,636)
Long-term debt, net$765,702 $831,656 
________________
(1)Interest rate represents the weighted average interest rate as of the respective periods.

Debt Covenants - As of March 26, 2023 and December 25, 2022, the Company was in compliance with its debt covenants.

7.    Convertible Senior Notes

2025 Notes - In connection with dividends paid during the thirteen weeks ended March 26, 2023, the conversion rate for theCompany’s remaining convertible senior notes due 2025 (“2025 Notes”) decreased to approximately $11.49 per share, which represents 87.059 shares of common stock per $1,000 principal amount of the 2025 Notes, or a total of approximately 9.141 million shares.

11

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
The following represents unrecognized stock-based compensation expense and the remaining weighted average vesting period as of June 26, 2022:
UNRECOGNIZED COMPENSATION EXPENSE
(dollars in thousands)
REMAINING WEIGHTED AVERAGE VESTING PERIOD (in years)
Performance-based share units$18,045 1.7
Restricted stock units$11,342 1.9

6.    Other Current Assets, Net

Other current assets, net, consisted of the following as of the periods indicated:
(dollars in thousands)JUNE 26, 2022DECEMBER 26, 2021
Prepaid expenses$28,000 $21,194 
Accounts receivable - gift cards, net15,575 91,248 
Accounts receivable - vendors, net12,284 11,793 
Accounts receivable - franchisees, net1,720 1,701 
Accounts receivable - other, net19,184 18,353 
Deferred gift card sales commissions12,338 17,793 
Company-owned life insurance policies21,501 17,244 
Other current assets, net6,395 5,297 
$116,997 $184,623 

7.    Long-term Debt, Net

Following is a summary of outstanding Long-term debt, net as of the periods indicated:
JUNE 26, 2022DECEMBER 26, 2021
(dollars in thousands)OUTSTANDING BALANCEINTEREST RATEOUTSTANDING BALANCEINTEREST RATE
Senior Secured Credit Facility:
Term loan A (1)$— $195,000 1.60 %
Revolving credit facility (2)400,000 2.74 %80,000 3.75 %
Total Senior Secured Credit Facility400,000 275,000 
2025 Notes (3)105,000 5.00 %230,000 5.00 %
2029 Notes300,000 5.13 %300,000 5.13 %
Finance lease liabilities4,228 2,376 
Less: unamortized debt discount and issuance costs (4)(7,176)(14,157)
Less: finance lease interest(319)(154)
Total debt, net801,733 793,065 
Less: current portion of long-term debt(1,511)(10,958)
Long-term debt, net$800,222 $782,107 
________________
(1)Interest rate represents the weighted average interest rate as of December 26, 2021.
(2)Interest rate represents the weighted average interest rate as of June 26, 2022 and the base rate option elected in anticipation of impending repayment as of December 26, 2021.
(3)During the thirteen weeks ended June 26, 2022, the Company repurchased $125.0 million of the 2025 Notes. See Note 8 - Convertible Senior Notes for additional details.
(4)In connection with the Amended Credit Agreement and the partial repurchase of the 2025 Notes, $5.7 million of debt issuance costs were written off during the thirteen weeks ended June 26, 2022. See Note 8 - Convertible Senior Notes for additional details.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Credit Agreement Amendment - On April 16, 2021, the Company and its wholly-owned subsidiary OSI Restaurant Partners, LLC (“OSI”), as co-borrowers, entered into the Second Amended and Restated Credit Agreement (the “Credit Agreement”), which provides for senior secured financing of up to $1.0 billion consisting of a $200.0 million Term loan A and an $800.0 million revolving credit facility (the “Senior Secured Credit Facility”), maturing on April 16, 2026.

On April 26, 2022, the Company and OSI entered into the First Amendment to the Second Amended and Restated Credit Agreement and Incremental Amendment (the “Amended Credit Agreement”), which included an increase of the Company’s existing revolving credit facility from $800.0 million to $1.0 billion and a transition from London Inter-Bank Offered Rate (“LIBOR”) to Secured Overnight Financing Rate (“SOFR”) as the benchmark rate for purposes of calculating interest under the Senior Secured Credit Facility. At closing, an incremental $192.5 million was drawn on the revolving credit facility to fully repay the outstanding balance of Term loan A. The total indebtedness of the Company remained unchanged as a result of the Amended Credit Agreement.

Under the Amended Credit Agreement, the Company may elect an interest rate at each reset period based on the Base Rate or Adjusted Term SOFR, plus an applicable spread. The Base Rate option is the highest of: (i) the prime rate of Wells Fargo Bank, National Association, (ii) the federal funds effective rate plus 0.5 of 1.0% or (iii) the Adjusted Term SOFR with a one-month interest period plus 1.0% (the “Base Rate”). The Adjusted Term SOFR option is the 30, 90 or 180-day SOFR, plus a term SOFR adjustment of 0.10%, subject to a 0% floor (the “Adjusted Term SOFR”). The interest rate spreads are as follows:
BASE RATE ELECTIONADJUSTED TERM SOFR ELECTION
Revolving credit facility50 to 150 basis points over the Base Rate150 to 250 basis points over the Adjusted Term SOFR

The transition to SOFR did not materially impact the interest rate applied to the Company’s borrowings. No other material changes were made to the terms of the Company’s Credit Agreement as a result of the Amended Credit Agreement.

As of June 26, 2022 and December 26, 2021, the Company was in compliance with its debt covenants.

Following is a summary of principal payments of the Company’s total consolidated debt outstanding as of the period indicated:
(dollars in thousands)JUNE 26, 2022
Year 1$1,543 
Year 21,389 
Year 3105,770 
Year 4400,306 
Year 5176 
Thereafter300,044 
Total payments809,228 
Less: unamortized debt discount and issuance costs(7,176)
Less: finance lease interest(319)
Total principal payments$801,733 

8.    Convertible Senior Notes

2025 Notes - On May 25, 2022, the Company entered into exchange agreements (the “Exchange Agreements”) with certain holders (the “Noteholders”) of the 2025 Notes. The Noteholders agreed to exchange $125.0 million in
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
aggregate principal amount of the Company’s outstanding 2025 Notes for $196.9 million in cash, plus accrued interest, and approximately 2.3 million shares of the Company’s common stock (the “2025 Notes Partial Repurchase”). Under the Exchange Agreements, the total amount of cash paid and number of shares of common stock issued by the Company were based upon the volume-weighted average price per share of the Company’s common stock during a ten-trading day averaging period ending on June 14, 2022. Upon entering into the Exchange Agreements, the conversion feature related to the 2025 Notes repurchased, as well as the settlements of the related convertible senior note hedges and warrants, were subject to derivative accounting. In connection with the 2025 Notes Partial Repurchase, the Company recognized a loss on extinguishment of debt of $104.7 million and a loss on fair value adjustment of derivatives, net of $17.7 million, and recorded a $48.5 million increase to Additional paid-in capital during the thirteen weeks ended June 26, 2022.

The initial conversion rate applicable to the 2025 Notes was 84.122 shares of common stock per $1,000 principal amount of 2025 Notes, or a total of approximately 19.348 million shares for the total $230.0 million principal amount. This initial conversion rate was equivalent to an initial conversion price of approximately $11.89 per share. In connection with dividends paid during the twenty-six weeks ended June 26, 2022, the conversion rate for the remaining 2025 Notes decreased to approximately $11.74 per share, which represents 85.185 shares of common stock per $1,000 principal amount of the 2025 Notes, or a total of approximately 8.944 million shares.

The following table includes the outstanding principal amount and carrying value of the 2025 Notes as of the periods indicated:
(dollars in thousands)(dollars in thousands)JUNE 26, 2022DECEMBER 26, 2021(dollars in thousands)MARCH 26, 2023DECEMBER 25, 2022
Long-term debt, netLong-term debt, netLong-term debt, net
PrincipalPrincipal$105,000 $230,000 Principal$105,000 $105,000 
Less: debt issuance costs (1)Less: debt issuance costs (1)(2,321)(5,898)Less: debt issuance costs (1)(1,744)(1,939)
Net carrying amountNet carrying amount$102,679 $224,102 Net carrying amount$103,256 $103,061 
________________
(1)Debt issuance costs are amortized to Interest expense, net using the effective interest method over the 2025 Notes’ expected life. During the thirteen weeks ended June 26, 2022, the Company wrote off $2.8 million of debt issuance costs as a result of the 2025 Notes Partial Repurchase.

Following is a summary of interest expense for the 2025 Notes by component for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Coupon interestCoupon interest$2,597 $2,875 $5,472 $5,750 Coupon interest$1,313 $2,875 
Debt issuance cost amortizationDebt issuance cost amortization370 386 774 767 Debt issuance cost amortization195 404 
Total interest expense (1)Total interest expense (1)$2,967 $3,261 $6,246 $6,517 Total interest expense (1)$1,508 $3,279 
________________
(1)The effective rate of the 2025 Notes over their expected life is 5.85%5.85%.

Based on the daily closing prices of the Company’s stock during the quarter ended JuneMarch 26, 2022,2023, the remaining holders of the 2025 Notes are eligible to convert their 2025 Notes during the thirdsecond quarter of 2022.

Convertible Note Hedge and Warrant Transactions - In connection with the 2025 Notes Partial Repurchase, the Company entered into partial unwind agreements with certain financial institutions relating to a portion of the convertible note hedge transactions (the “Note Hedge Early Termination Agreements”) and a portion of the Warrant Transactions (the “Warrant Early Termination Agreements”) that were previously entered into by the Company in connection with the issuance of the 2025 Notes. Upon settlement, the Company received $131.9 million for the Note Hedge Early Termination Agreements and paid $114.8 million for the Warrant Early Termination Agreements during the thirteen weeks ended June 26, 2022. In connection with the Note Hedge Early Termination Agreements and the Warrant Early Termination Agreements the Company recorded a $113.0 million increase and a $97.6 million decrease, respectively, to Additional paid-in capital during the thirteen weeks ended June 26, 2022.
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
The remaining Warrant Transactions have a dilutive effect on the Company’s common stock to the extent that the price of its common stock exceeds the strike price of the Warrant Transactions. The strike price was initially $16.64 per share and is subject to certain adjustments under the terms of the Warrant Transactions. In connection with dividends paid during the twenty-six weeks ended June 26, 2022, the strike price for the remaining Warrant Transactions decreased to $16.43.2023.

9.    Other Long-term Liabilities, Net

Other long-term liabilities, net, consisted of the following as of the periods indicated:
(dollars in thousands)JUNE 26, 2022DECEMBER 26, 2021
Accrued insurance liability$29,281 $31,517 
Deferred payroll tax liabilities (1)— 27,302 
Executive management deferred compensation obligations19,098 23,543 
Other long-term liabilities40,111 42,880 
$88,490 $125,242 
_______________
(1)During the twenty-six weeks ended June 26, 2022, the Company reclassified $27.3 million of payroll taxes deferred under the CARES Act to current.

10.8.    Stockholders’ Equity

Share Repurchases - On February 8, 2022, the Company’s Board of Directors (the “Board”) approved a share repurchase program (the “2022 Share Repurchase Program”) under which the Company was authorized to repurchase up to $125.0 million of its outstanding common stock. TheDuring the thirteen weeks ended March 26, 2023, the Company fully utilized the remaining share repurchase authorization under the 2022 Share Repurchase Program will expireProgram. On February 7, 2023, the Company’s Board approved a new $125.0 million authorization (the “2023 Share Repurchase Program”) expiring on August 9, 2023.7, 2024. As of JuneMarch 26, 2022, $77.52023, $119.4 million remained available for repurchase under the 20222023 Share Repurchase Program.

Following is a summary of the shares repurchased under the 2022 Share Repurchase Program during fiscal year 2022:2023:
(in thousands, except per share data)(in thousands, except per share data)NUMBER OF SHARESAVERAGE REPURCHASE PRICE PER SHAREAMOUNT(in thousands, except per share data)NUMBER OF SHARESAVERAGE REPURCHASE PRICE PER SHAREAMOUNT
First fiscal quarter(1)First fiscal quarter(1)551 $21.26 $11,702 First fiscal quarter(1)863 $23.92 $20,645 
Second fiscal quarter1,761 $20.30 35,749 
Total common stock repurchases (1)2,312 $20.53 $47,451 
________________
(1)Excludes excise tax on share repurchases. Subsequent to JuneMarch 26, 2022,2023, the Company repurchased 854291 thousand shares of its common stock for $14.9$7.2 million under a Rule 10b5-1 plan through July 28, 2022.plan.

Dividends - The Company declared and paid dividends per share during fiscal year 20222023 as follows:
(dollars in thousands, except per share data)(dollars in thousands, except per share data)DIVIDENDS PER SHAREAMOUNT(dollars in thousands, except per share data)DIVIDENDS PER SHAREAMOUNT
First fiscal quarterFirst fiscal quarter$0.14 $12,559 First fiscal quarter$0.24 $21,014 
Second fiscal quarter0.14 12,418 
Total cash dividends declared and paid$0.28 $24,977 

In July 2022,April 2023, the Board declared a quarterly cash dividend of $0.14$0.24 per share, payable on AugustMay 24, 20222023 to shareholders of record at the close of business on AugustMay 10, 2022.2023.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Accumulated Other Comprehensive Loss (“AOCL”) -Following are the components AOCL consisted of AOCLforeign currency translation adjustments as of the periods indicated:March 26, 2023 and December 25, 2022.
(dollars in thousands)JUNE 26, 2022DECEMBER 26, 2021
Foreign currency translation adjustment$(172,257)$(195,480)
Unrealized loss on derivatives, net of tax(3,797)(10,509)
Accumulated other comprehensive loss$(176,054)$(205,989)

Following are the components of Other comprehensive (loss) income attributable to Bloomin’ Brands for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Foreign currency translation adjustment$11,940 $10,015 $23,223 $3,440 
Unrealized (loss) gain on derivatives, net of tax— (128)573 (170)
Reclassification of adjustments for loss on derivatives included in Net (loss) income, net of tax (1)273 1,514 954 4,517 
Impact of terminated interest rate swaps included in Net (loss) income, net of tax (1)2,164 1,471 5,185 1,471 
Total gain on derivatives, net of tax2,437 2,857 6,712 5,818 
Other comprehensive income attributable to Bloomin’ Brands$14,377 $12,872 $29,935 $9,258 
________________
(1)See Note 11 - Derivative Instruments and Hedging Activities for the tax impact of reclassifications and the terminated swaps.
THIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Foreign currency translation adjustment$(1,134)$11,283 
Unrealized gain on derivatives, net of tax— 573 
Reclassification of adjustments for loss on derivatives included in Net income, net of tax— 681 
Impact of terminated interest rate swaps included in Net income, net of tax— 3,021 
Total gain on derivatives, net of tax— 4,275 
Other comprehensive (loss) income attributable to Bloomin’ Brands$(1,134)$15,558 

11.    Derivative Instruments and Hedging Activities

Cash Flow Hedges of Interest Rate Risk -In October 2018, the Company entered into variable-to-fixed interest rate swap agreements with 12 counterparties to hedge a portion of the cash flows of the Company’s variable rate debt. The swap agreements had an aggregate notional amount of $550.0 million and mature on November 30, 2022. Under the terms of the swap agreements, the Company paid a weighted average fixed rate of 3.04% on the notional amount and received payments from the counterparty based on one-month LIBOR. During 2021, the Company terminated its variable-to-fixed interest rate swap agreements with certain counterparties and as a result, as of December 26, 2021 had interest rate swap agreements remaining with 2counterparties for an aggregate notional amount of $125.0 million.

In connection with the Amended Credit Agreement, on April 26, 2022 the Company terminated its remaining variable-to-fixed interest rate swap agreements. Following these terminations, the unrealized losses related to the terminated swap agreements included in Accumulated other comprehensive loss will be amortized to Interest expense, net during 2022.

The Company’s swap agreements were designated and qualified as cash flow hedges, recognized on its Consolidated Balance Sheet at fair value as of December 26, 2021 and classified based on the instruments’maturity dates. As of June 26, 2022, the Company estimated $5.2 million of interest expense from the terminated swap agreements will be reclassified to Interest expense, net through the November 2022 maturity date of the swaps.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
The following table presents the fair value and classification of the Company’s swap agreements, as of the period indicated:
(dollars in thousands)DECEMBER 26, 2021CONSOLIDATED BALANCE SHEET CLASSIFICATION
Interest rate swaps - liability (1)$3,056 Accrued and other current liabilities
Accrued interest$276 Accrued and other current liabilities
____________________
(1)See Note 13 - Fair Value Measurements for fair value discussion of the interest rate swaps.

The following table summarizes the effects of the swap agreements on Net (loss) income for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Interest rate swap agreements:
Interest rate swap expense recognized in Interest expense, net$(367)$(2,038)$(1,284)$(6,082)
Income tax benefit recognized in Provision for income taxes94 524 330 1,565 
Net effects of interest rate swap agreements$(273)$(1,514)$(954)$(4,517)
Terminated interest rate swap agreements:
Terminated interest rate swap expense recognized in Interest expense, net$(2,913)$(1,981)$(6,980)$(1,981)
Income tax benefit recognized in Provision for income taxes749 510 1,795 510 
Net effects of terminated interest rate swap agreements$(2,164)$(1,471)$(5,185)$(1,471)
Total net effects on Net (loss) income$(2,437)$(2,985)$(6,139)$(5,988)

12.9.    Leases

The following table includes a detail of lease assets and liabilities included on the Company’s Consolidated Balance Sheets as of the periods indicated:
(dollars in thousands)(dollars in thousands)CONSOLIDATED BALANCE SHEET CLASSIFICATIONJUNE 26, 2022DECEMBER 26, 2021(dollars in thousands)CONSOLIDATED BALANCE SHEET CLASSIFICATIONMARCH 26, 2023DECEMBER 25, 2022
Operating lease right-of-use assetsOperating lease right-of-use assetsOperating lease right-of-use assets$1,122,317 $1,130,873 Operating lease right-of-use assetsOperating lease right-of-use assets$1,091,943 $1,103,083 
Finance lease right-of-use assets (1)Finance lease right-of-use assets (1)Property, fixtures and equipment, net3,782 2,074 Finance lease right-of-use assets (1)Property, fixtures and equipment, net8,909 4,679 
Total lease assets, netTotal lease assets, net$1,126,099 $1,132,947 Total lease assets, net$1,100,852 $1,107,762 
Current operating lease liabilities (2)Current operating lease liabilities (2)Accrued and other current liabilities$178,817 $177,028 Current operating lease liabilities (2)Accrued and other current liabilities$182,782 $183,510 
Current finance lease liabilitiesCurrent finance lease liabilitiesCurrent portion of long-term debt1,511 958 Current finance lease liabilitiesCurrent portion of long-term debt2,267 1,636 
Non-current operating lease liabilities (2)Non-current operating lease liabilities (2)Non-current operating lease liabilities1,168,418 1,178,998 Non-current operating lease liabilities (2)Non-current operating lease liabilities1,136,493 1,148,379 
Non-current finance lease liabilitiesNon-current finance lease liabilitiesLong-term debt, net2,398 1,264 Non-current finance lease liabilitiesLong-term debt, net6,847 3,149 
Total lease liabilitiesTotal lease liabilities$1,351,144 $1,358,248 Total lease liabilities$1,328,389 $1,336,674 
________________
(1)Net of accumulated amortization of $4.1$3.0 million and $3.3$3.6 million as of JuneMarch 26, 20222023 and December 26, 2021,25, 2022, respectively.
(2)Excludes current accrued contingent percentage rent of $4.3 million and $3.5$3.4 million as of JuneMarch 26, 20222023 and December 26, 2021, respectively,25, 2022 and immaterial current and non-current COVID-19-related deferred rent accruals.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Following is a summary of expenses and income related to leases recognized in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income for the periods indicated:
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME CLASSIFICATIONTHIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME CLASSIFICATIONTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Operating leases (1)Operating leases (1)Other restaurant operating$45,579 $43,763 $90,940 $88,555 Operating leases (1)Other restaurant operating$45,747 $45,361 
Variable lease cost (2)Variable lease cost (2)Other restaurant operating1,619 731 3,502 1,508 Variable lease cost (2)Other restaurant operating1,724 1,883 
Finance leases:Finance leases:Finance leases:
Amortization of leased assetsAmortization of leased assetsDepreciation and amortization356 258 693 520 Amortization of leased assetsDepreciation and amortization488 337 
Interest on lease liabilitiesInterest on lease liabilitiesInterest expense, net44 31 76 67 Interest on lease liabilitiesInterest expense, net136 32 
Sublease revenueSublease revenueFranchise and other revenues(2,436)(2,825)(4,994)(3,660)Sublease revenueFranchise and other revenues(1,708)(2,558)
Lease costs, netLease costs, net$45,162 $41,958 $90,217 $86,990 Lease costs, net$46,387 $45,055 
________________
(1)Excludes rent expense for office facilities and Company-owned closed or subleased properties of $3.1$3.0 million and $3.2 million for both the thirteen weeks ended JuneMarch 26, 20222023 and JuneMarch 27, 2021, respectively, and $6.1 million and $6.7 million for the twenty-six weeks ended June 26, 2022, and June 27, 2021, respectively, which is included in General and administrative expense.
(2)Includes COVID-19-related rent abatements for the thirteen and twenty-six weeks ended June 27, 2021.

The following table is a summary of cash flow impacts to the Company’s Consolidated Financial Statements related to its leases for the periods indicated:
TWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Cash flows from operating activities:Cash flows from operating activities:Cash flows from operating activities:
Cash paid for amounts included in the measurement of operating lease liabilitiesCash paid for amounts included in the measurement of operating lease liabilities$97,255 $105,323 Cash paid for amounts included in the measurement of operating lease liabilities$48,620 $48,560 

13.10.    Fair Value Measurements

Fair value is the price that would be received for an asset or paid to transfer a liability, or the exit price, in an orderly transaction between market participants on the measurement date. Fair value is categorized into one of the following three levels based on the lowest level of significant input:
Level 1Unadjusted quoted market prices in active markets for identical assets or liabilities
Level 2Observable inputs available at measurement date other than quoted prices included in Level 1
Level 3Unobservable inputs that cannot be corroborated by observable market data

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Fair Value Measurements on a Recurring Basis - The following table summarizes the Company’s financial assets and liabilities measured at fair value by hierarchy level on a recurring basis as of the periods indicated:
JUNE 26, 2022DECEMBER 26, 2021
(dollars in thousands)TOTALLEVEL 1LEVEL 2TOTALLEVEL 1LEVEL 2
Assets:
Cash equivalents:
Fixed income funds$13,583 $13,583 $— $6,714 $6,714 $— 
Money market funds10,670 10,670 — 9,039 9,039 — 
Restricted cash equivalents:
Money market funds101 101 — 1,472 1,472 — 
Total asset recurring fair value measurements$24,354 $24,354 $— $17,225 $17,225 $— 
Liabilities:
Accrued and other current liabilities:
Derivative instruments - interest rate swaps$— $— $— $3,056 $— $3,056 
Total liability recurring fair value measurements$— $— $— $3,056 $— $3,056 

Fair value of each class of financial instrument is determined based on the following:
FINANCIAL INSTRUMENTMETHODS AND ASSUMPTIONS
Fixed income funds and Money market fundsCarrying value approximates fair value because maturities are less than three months.
Derivative instrumentsThe Company’s derivative instruments include interest rate swaps. Fair value measurements are based on the contractual terms of the derivatives and use observable market-based inputs. The interest rate swaps are valued using a discounted cash flow analysis on the expected cash flows of each derivative using observable inputs including interest rate curves and credit spreads. The Company also considers its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. As of December 26, 2021, the Company has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives.

Fair Value Measurements on a Nonrecurring Basis - Assets and liabilities that are measured at fair value on a nonrecurring basis relate primarily to property, fixtures and equipment, operating lease right-of-use assets, goodwill and other intangible assets, which are remeasured when carrying value exceeds fair value. Carrying value after impairment approximates fair value. The following tables summarize the Company’s assets measured at fair value by hierarchy level on a nonrecurring basis, for the periods indicated:
THIRTEEN WEEKS ENDED
JUNE 27, 2021
(dollars in thousands)REMAINING CARRYING VALUE (1)TOTAL IMPAIRMENT
Operating lease right-of-use assets$5,687 $962 
Property, fixtures and equipment8,192 4,460 
$13,879 $5,422 
TWENTY-SIX WEEKS ENDED
JUNE 27, 2021
(dollars in thousands)REMAINING CARRYING VALUE (1)TOTAL IMPAIRMENT
Operating lease right-of-use assets$7,651 $1,512 
Property, fixtures and equipment8,928 6,052 
$16,579 $7,564 
MARCH 26, 2023DECEMBER 25, 2022
(dollars in thousands)TOTALLEVEL 1TOTALLEVEL 1
Assets (1):
Cash equivalents:
Fixed income funds$3,886 $3,886 $3,301 $3,301 
Money market funds8,602 8,602 4,786 4,786 
Total asset recurring fair value measurements$12,488 $12,488 $8,087 $8,087 
________________
(1)All asset carrying values measured using discounted cash flow models (Level 3).Carrying value approximates fair value because maturities are less than three months.
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Interim Disclosures about Fair Value of Financial Instruments - The Company’s non-derivative financial instruments consist of cash equivalents, accounts receivable, accounts payable and current and long-term debt. The fair values of cash equivalents, accounts receivable and accounts payable approximate their carrying amounts reported on its Consolidated Balance Sheets due to their short duration.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Debt is carried at amortized cost; however, the Company estimates the fair value of debt for disclosure purposes. The following table includes the carrying value and fair value of the Company’s debt by hierarchy level as of the periods indicated:
JUNE 26, 2022DECEMBER 26, 2021MARCH 26, 2023DECEMBER 25, 2022
CARRYING VALUEFAIR VALUE LEVEL 2CARRYING VALUEFAIR VALUE LEVEL 2CARRYING VALUEFAIR VALUE LEVEL 2CARRYING VALUEFAIR VALUE LEVEL 2
(dollars in thousands)(dollars in thousands)(dollars in thousands)
Senior Secured Credit Facility:
Term loan A$— $— $195,000 $190,125 
Revolving credit facility$400,000 $390,000 $80,000 $76,926 
Senior secured credit facility - revolving credit facilitySenior secured credit facility - revolving credit facility$360,000 $360,000 $430,000 $430,000 
2025 Notes2025 Notes$105,000 $177,031 $230,000 $447,615 2025 Notes$105,000 $233,054 $105,000 $198,843 
2029 Notes2029 Notes$300,000 $255,000 $300,000 $304,395 2029 Notes$300,000 $268,212 $300,000 $260,265 

14.11.    Income Taxes
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
(Loss) income before provision for income taxes$(50,144)$107,574 $43,479 $183,965 
Income before provision for income taxesIncome before provision for income taxes$108,189 $93,623 
Provision for income taxesProvision for income taxes$11,536 $22,688 $27,465 $29,281 Provision for income taxes$14,761 $15,929 
Effective income tax rateEffective income tax rate(23.0)%21.1 %63.2 %15.9 %Effective income tax rate13.6 %17.0 %

The effective income tax rate for the thirteen weeks ended JuneMarch 26, 2022 includes the impact of nondeductible losses associated with the 2025 Notes Partial Repurchase which, relative to a pre-tax book loss during the quarter, resulted in a negative effective income tax rate.

The effective income tax rate for the twenty-six weeks ended June 26, 2022 increased2023 decreased by 47.33.4 percentage points as compared to the twenty-sixthirteen weeks ended JuneMarch 27, 2021. The increase2022. This decrease was primarily due to the non-deductible losses associated withbenefits of Brazil tax legislation that include a temporary reduction in the 2025 Notes Partial Repurchase recorded duringBrazilian income tax rate from 34% to 0% applicable to the twenty-sixthirteen weeks ended JuneMarch 26, 2022.2023.

On December 28, In September 2022, the Company’s Brazilian subsidiary received a preliminary injunction authorizing it to benefit from the exemptions enacted by Law 14,148/2021 the U.S. Treasurywhich provides for emergency and the Internal Revenue Service released final regulationstemporary actions that among other things, provide guidance on several aspects of the foreignwould grant certain industries a 100% exemption from income tax credit rules. As(IRPJ and CSLL) and federal value added taxes (PIS and COFINS) for a five-year period. The injunction was issued as part of an ongoing lawsuit initiated by the guidance issued, these regulations change longstanding foreign taxCompany’s Brazilian subsidiary due to the uncertainty regarding the restaurant industry’s eligibility for the exemptions under this legislation. The Company will continue to evaluate and assess the exemptions, the status of its preliminary injunction and all other available evidence to determine the exemption status with respect to this subsidiary in future periods.

A restaurant company employer may claim a credit regulations that now make foreignagainst its federal income taxes for FICA taxes paid toon certain countries no longer creditable in the United States.tipped wages (the “FICA tax credit”). The Company expectslevel of FICA tax credits is primarily driven by U.S. Restaurant sales and is not impacted by costs incurred that a portion of post-2022 foreign taxes paid will not be creditable in the United States. Furthermore, the impact of these regulations will result in the utilization of existing prior year foreign tax credit carryforwards for which the Company had previously recorded a valuation allowance. The valuation allowance related to the credits expected to be utilized has been released during the thirteen and twenty-six weeks ended June 26, 2022.may reduce pre-tax income.

The effective income tax rate for the thirteen weeks ended JuneMarch 26, 20222023 was lower than the Company’s blended federal and state statutory rate of approximately 26%. The income tax rate includes the impact of nondeductible losses associated with the 2025 Notes Partial Repurchase which, relative to a pre-tax book loss during the quarter, resulted in a negative effective income tax rate.

The effective income tax rate for the twenty-six weeks ended June 26, 2022 was higher than the statutory rate primarily due to the non-deductible losses associated with the 2025 Notes Partial Repurchase recorded during the twenty-six weeks ended June 26, 2022.
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
The effective income tax rates for the thirteen and twenty-six weeks ended June 27, 2021 were lower than the statutory rate primarily due to the benefit of FICA tax credits on certain employees’ tips.tipped wages and benefits of Brazil tax legislation that include a temporary reduction in the Brazilian income tax rate from 34% to 0%.

15.12.    Commitments and Contingencies

Litigation and Other Matters - The Company is subject to legal proceedings, claims and liabilities, such as liquor liability, slip and fall cases, wage-and-hourwage and hour and other employment-related litigation, which arise in the ordinary course of business. A reserve is recorded when it is both: (i) probable that a loss has occurred and (ii) the amount of loss can be reasonably estimated. There may be instances in which an exposure to loss exceeds the recorded reserve. The Company evaluates, on a quarterly basis, developments in legal proceedings that could cause an increase or decrease in the amount of the reserve that has been previously recorded, or a revision to the disclosed estimated range of possible losses, as applicable.
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
The Company’s legal proceedings range from cases brought by a single plaintiff to threatened class actions with many putative class members. While some matters pending against the Company specify the damages claimed by the plaintiff or class, many seek unspecified amounts or are at very early stages of the legal process. Even when the amount of damages claimed against the Company are stated, the claimed amount may be exaggerated, unsupported or unrelated to possible outcomes, and as such, are not meaningful indicators of the Company’s potential liability or financial exposure. As a result, some matters have not yet progressed sufficiently through discovery or development of important factual information and legal issues to enable the Company to estimate an amount of loss or a range of possible loss.

The Company recorded reserves of $8.5 million and $7.1 million for certain of its outstanding legal proceedings as of June 26, 2022 and December 26, 2021, respectively, within Accrued and other current liabilities and Other long-term liabilities on its Consolidated Balance Sheets. While the Company believes that additional losses beyond these accruals are reasonably possible, it cannot estimate a possible loss contingency or range of reasonably possible loss contingencies beyond these accruals.

The Company intends to defend itself in legal matters. Some of these matters may be covered, at least in part, by insurance if they exceed specified retention or deductible amounts. However, it is possible that claims may be denied by the Company’s insurance carriers, the Company may be required by its insurance carriers to contribute to the payment of claims, or the Company’s insurance coverage may not continue to be available on acceptable terms or in sufficient amounts. The Company records receivables from third party insurers when recovery has been determined to be probable. The Company believes that the ultimate determination of liability in connection with legal claims pending against the Company, if any, in excess of amounts already provided for such matters in the consolidated financial statements, will not have a material adverse effect on its business, annual results of operations, liquidity or financial position. However, it is possible that the Company’s business, results of operations, liquidity, or financial condition could be materially affected in a particular future reporting period by the unfavorable resolution of one or more matters or contingencies during such period.

The Company recorded reserves of $15.9 million and $15.1 million for certain of its outstanding legal proceedings as of March 26, 2023 and December 25, 2022, respectively, within Accrued and other current liabilities on its Consolidated Balance Sheets. While the Company believes that additional losses beyond these accruals are reasonably possible, it cannot estimate a possible loss contingency or range of reasonably possible loss contingencies beyond these accruals.

Lease Guarantees - The Company assigned its interest, and is contingently liable, under certain real estate leases. These leases have varying terms, the latest of which expires in 2032. As of JuneMarch 26, 2022,2023, the undiscounted payments that the Company could be required to make in the event of non-payment by the primary lessees was approximately $23.0$22.7 million. The present value of these potential payments discounted at the Company’s incremental borrowing rate as of JuneMarch 26, 20222023 was approximately $17.5$17.2 million. In the event of default, the indemnity clauses in the Company’s purchase and sale agreements generally govern its ability to pursue and recover damages incurred. As of JuneMarch 26, 20222023 and December 26, 2021,25, 2022, the Company’s recorded contingent lease liability was $8.4 million and $8.7 million, respectively.$6.2 million.

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
16.13.    Segment Reporting

The following is a summary of reporting segments:
REPORTABLE SEGMENT (1)CONCEPTGEOGRAPHIC LOCATION
U.S.Outback SteakhouseUnited States of America
Carrabba’s Italian Grill
Bonefish Grill
Fleming’s Prime Steakhouse & Wine Bar
InternationalOutback SteakhouseBrazil, Hong Kong/China
Carrabba’s Italian Grill (Abbraccio)Brazil
_________________
(1)Includes franchise locations.
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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
Segment accounting policies are the same as those described in Note 2 - Summary of Significant Accounting Policies in the Company’s Annual Report on Form 10-K for the year ended December 26, 2021.25, 2022. Revenues for all segments include only transactions with customers and exclude intersegment revenues. Excluded from Income from operations for U.S. and international are certain legal and corporate costs not directly related to the performance of the segments, most stock-based compensation expenses, certain insurance expenses and certain bonus expenses.

The following table is a summary of Total revenues by segment for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Total revenuesTotal revenuesTotal revenues
U.S.U.S.$998,627 $1,003,058 $2,035,034 $1,907,976 U.S.$1,092,996 $1,036,407 
InternationalInternational126,535 74,308 230,663 156,863 International151,750 104,128 
Total revenuesTotal revenues$1,125,162 $1,077,366 $2,265,697 $2,064,839 Total revenues$1,244,746 $1,140,535 

The following table is a reconciliation of segment income from operations to (Loss) incomeIncome before provision for income taxes for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Segment income from operationsSegment income from operationsSegment income from operations
U.S.U.S.$104,620 $165,297 $236,846 $287,032 U.S.$133,243 $132,226 
InternationalInternational14,126 2,470 23,010 6,007 International24,508 8,884 
Total segment income from operationsTotal segment income from operations118,746 167,767 259,856 293,039 Total segment income from operations157,751 141,110 
Unallocated corporate operating expenseUnallocated corporate operating expense(31,027)(43,130)(64,881)(77,404)Unallocated corporate operating expense(37,118)(33,854)
Total income from operationsTotal income from operations87,719 124,637 194,975 215,635 Total income from operations120,633 107,256 
Loss on extinguishment and modification of debt(107,630)(2,073)(107,630)(2,073)
Loss on fair value adjustment of derivatives, net(17,685)— (17,685)— 
Other income, net— — — 21 
Interest expense, netInterest expense, net(12,548)(14,990)(26,181)(29,618)Interest expense, net(12,444)(13,633)
(Loss) income before provision for income taxes$(50,144)$107,574 $43,479 $183,965 
Income before provision for income taxesIncome before provision for income taxes$108,189 $93,623 

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BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) - Continued
The following table is a summary of Depreciation and amortization expense by segment for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Depreciation and amortizationDepreciation and amortizationDepreciation and amortization
U.S.U.S.$33,544 $33,578 $68,303 $67,223 U.S.$38,163 $34,759 
InternationalInternational6,019 5,566 11,556 11,286 International5,919 5,537 
CorporateCorporate1,694 1,395 3,173 3,256 Corporate2,220 1,479 
Total depreciation and amortizationTotal depreciation and amortization$41,257 $40,539 $83,032 $81,765 Total depreciation and amortization$46,302 $41,775 

Geographic Areas - International revenues are defined as revenues generated from restaurant sales originating in a country other than the U.S. The following table details Total revenues by major geographic area for the periods indicated:
THIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
U.S.$1,092,996 $1,036,407 
International
Brazil138,994 90,100 
Other12,756 14,028 
Total revenues$1,244,746 $1,140,535 
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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s discussion and analysis of financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and the related notes. Unless the context otherwise indicates, as used in this report, the term the “Company,” “we,” “us,” “our” and other similar terms mean Bloomin’ Brands, Inc. and its subsidiaries.

Cautionary Statement

This Quarterly Report on Form 10-Q (the “Report”) includes statements that express our opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms “believes,” “estimates,” “anticipates,” “expects,” “feels,” “seeks,” “forecasts,” “projects,” “intends,” “plans,” “may,” “will,” “should,” “could” or “would” or, in each case, their negative or other variations or comparable terminology, although not all forward-looking statements are accompanied by such terms. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this Report and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which we operate.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Although we base these forward-looking statements on assumptions that we believe are reasonable when made, we caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and industry developments may differ materially from statements made in or suggested by the forward-looking statements contained in this Report. In addition, even if our results of operations, financial condition and liquidity, and industry developments are consistent with the forward-looking statements contained in this Report, those results or developments may not be indicative of results or developments in subsequent periods. Important factors that could cause actual results to differ materially from statements made or suggested by forward-looking statements include, but are not limited to, the following:

(i)Consumer reactions to public health and food safety issues;

(ii)The severity, extent and duration of the COVID-19 pandemic, its impacts on our business and results of operations, financial condition and liquidity, including any adverse impact on our stock price and on the other factors listed below, and the responses of domestic and foreign federal, state and local governments to the pandemic;

(iii)Minimum wage increases, additional mandated employee benefits and fluctuations in the cost and availability of employees;

(iii)Our ability to recruit and retain high-quality leadership, restaurant-level management and team members;

(iv)Fluctuations inEconomic conditions and their effects on consumer confidence and discretionary spending, consumer traffic, the pricecost and availability of commodities, including supplier freight chargescredit and restaurant distribution expenses, and other impacts of inflation;interest rates;

(v)Our ability to compete in the highly competitive restaurant industry with many well-established competitors and new market entrants;

(vi)Our ability to protect our information technology systems from interruption or security breach, including cyber security threats, and to protect consumer data and personal employee information;

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
(vi)(vii)Economic conditions and their effects on consumer confidence and discretionary spending, consumer traffic,Fluctuations in the costprice and availability of creditcommodities, including supplier freight charges and interest rates;

(vii)Our abilityrestaurant distribution expenses, and other impacts of inflation and our dependence on a limited number of suppliers and distributors to recruitmeet our beef, chicken and retain high-quality leadership, restaurant-level management and team members;other major product supply needs;

(viii)The severity, extent and duration of a health pandemic, its impacts on our business and results of operations, financial condition and liquidity, including any adverse impact on our stock price and on the other factors listed in this Report, and the responses of domestic and foreign federal, state and local governments to the pandemic;

(ix)Our ability to preserve and grow the reputation and value of our brands, particularly in light of changes in consumer engagement with social media platforms and limited control with respect to the operations of our franchisees;

(ix)Our ability to protect our information technology systems from interruption or security breach, including cyber security threats, and to protect consumer data and personal employee information;

(x)Dependence on a limited number of suppliers and distributors to meet our beef, chicken and other major product supply needs;

(xi)The effects of international economic, political and social conditions and legal systems on our foreign operations and on foreign currency exchange rates;

(xi)Our ability to comply with new environmental, social and governance (“ESG”) requirements or our failure to achieve any goals, targets or objectives with respect to ESG matters;

(xii)Our ability to effectively respond to changes in patterns of consumer traffic, consumer tastes and dietary habits, including by maintaining relationships with third party delivery apps and services;

(xiii)Our ability to comply with governmental laws and regulations, the costs of compliance with such laws and regulations and the effects of changes to applicable laws and regulations, including tax laws and unanticipated liabilities, and the impact of any litigation;

(xiii)Our ability to effectively respond to changes in patterns of consumer traffic, consumer tastes and dietary habits, including by maintaining relationships with third party delivery apps and services;

(xiv)Our ability to implement our remodeling, relocation and expansion plans, due to uncertainty in locating and acquiring attractive sites on acceptable terms, obtaining required permits and approvals, recruiting and training necessary personnel, obtaining adequate financing and estimating the performance of newly opened, remodeled or relocated restaurants;restaurants, and our cost savings plans to enable reinvestment in our business, due to uncertainty with respect to macroeconomic conditions and the efficiency that may be added by the actions we take;

(xv)Seasonal and periodic fluctuations in our results and the effects of significant adverse weather conditions and other disasters or unforeseen events;

(xvi)The effects of our leverage and restrictive covenants in our various credit facilities on our ability to raise additional capital to fund our operations, to make capital expenditures to invest in new or renovate restaurants and to react to changes in the economy or our industry;

(xvii)Any impairment in the carrying value of our goodwill or other intangible or long-lived assets and its effect on our financial condition and results of operations; and

(xviii)Such other factors as discussed in Part I, Item IA. Risk Factors of our Annual Report on Form 10-K for the year ended December 26, 2021.25, 2022.

Given these risks and uncertainties, we caution you not to place undue reliance on these forward-looking statements. Any forward-looking statement that we make in this Report speaks only as of the date of such statement, and we undertake no obligation to update any forward-looking statement or to publicly announce the results of any revision to any of those statements to reflect future events or developments. Comparisons of results for current and any prior
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Overview

We are one of the largest casual dining restaurant companies in the world with a portfolio of leading, differentiated restaurant concepts. As of JuneMarch 26, 2022,2023, we owned and operated 1,1691,184 full-service restaurants and off-premises only kitchens and franchised 332313 full-service restaurants and off-premises only kitchens across 47 states, Guam and 1513 countries. We have four founder-inspired concepts: Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse & Wine Bar.

Financial Highlights
-
Our financial highlights for the thirteen weeks ended JuneMarch 26, 20222023 include the following:

U.S. combined and Outback Steakhouse comparable restaurant sales of (0.4)%5.1% and (1.1)%4.9%, respectively;
Increase in Total revenues of 4.4%9.1%, as compared to the secondfirst quarter of 2021;2022;
Operating income and restaurant-level operating margins of 7.8%9.7% and 15.5%17.9%, respectively, as compared to 11.6%9.4% and 20.3%17.1%, respectively, for the secondfirst quarter of 2021;2022;
Income from operationsOperating income of $87.7$120.6 million, as compared to $124.6$107.3 million in the secondfirst quarter of 2021;
Loss on extinguishment of debt of $104.7 million and loss on fair value adjustment of derivatives, net, of $17.7 million in connection with the 2025 Notes Partial Repurchase;2022; and
Diluted loss per share of $(0.72), as compared to diluted earnings per share of $0.75$0.93 as compared to $0.73 for the secondfirst quarter of 2021.2022.

Key Financial Performance Indicators

- Key measures that we use in evaluating our restaurants and assessing our business include the following:

Average restaurant unit volumes—average sales (excluding gift card breakage)breakage and the benefit of value added tax exemptions in Brazil) per restaurant to measure changes in customer traffic, pricing and development of the brand;

Comparable restaurant sales—year-over-year comparison of the change in sales volumes (excluding gift card breakage)breakage and the benefit of value added tax exemptions in Brazil) for Company-owned restaurants that are open 18 months or more in order to remove the impact of new restaurant openings in comparing the operations of existing restaurants;

System-wide sales—total restaurant sales volume for all Company-owned and franchise restaurants, regardless of ownership, to interpret the overall health of our brands;

Restaurant-level operating margin, Income from operations, Net (loss) income and Diluted (loss) earnings per share—financial measures utilized to evaluate our operating performance.

Restaurant-level operating margin is a non-GAAP financial measure widely regarded in the industry as a useful metric to evaluate restaurant-level operating efficiency and performance of ongoing restaurant-level operations, and we use it for these purposes, overall and particularly within our two segments. Our restaurant-level operating margin is expressed as the percentage of our Restaurant sales that Food and beverage costs, Labor and other related expenses and Other restaurant operating expenses (including advertising expenses) represent, in each case as such items are reflected in our Consolidated Statements of Operations and Comprehensive (Loss) Income. The following categories of our revenue and operating expenses are not included in restaurant-level
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
not included in restaurant-level operating margin because we do not consider them reflective of operating performance at the restaurant-level within a period:

(i)Franchise and other revenues which are earned primarily from franchise royalties and other non-food and beverage revenue streams, such as rental and sublease income;
(ii)Depreciation and amortization which, although substantially all of which is related to restaurant-level assets, represent historical sunk costs rather than cash outlays for the restaurants;
(iii)General and administrative expense which includes primarily non-restaurant-level costs associated with support of the restaurants and other activities at our corporate offices; and
(iv)Asset impairment charges and restaurant closing costs which are not reflective of ongoing restaurant performance in a period.

Restaurant-level operating margin excludes various expenses, as discussed above, that are essential to support the operations of our restaurants and may materially impact our Consolidated Statements of Operations and Comprehensive (Loss) Income. As a result, restaurant-level operating margin is not indicative of our consolidated results of operations and is presented exclusively as a supplement to, and not a substitute for, Net (loss) income or Income from operations. In addition, our presentation of restaurant-level operating margin may not be comparable to similarly titled measures used by other companies in our industry; and

Adjusted restaurant-level operating margin, Adjusted income from operations, Adjusted net income and Adjusted diluted earnings per share—non-GAAP financial measures utilized to evaluate our operating performance.
    
We believe that our use of these non-GAAP financial measures permits investors to assess the operating performance of our business relative to our performance based on U.S. GAAP results and relative to other companies within the restaurant industry by isolating the effects of certain items that may vary from period to period without correlation to core operating performance or that vary widely among similar companies. However, our inclusion of these adjusted measures should not be construed as an indication that our future results will be unaffected by unusual or infrequent items or that the items for which we have made adjustments are unusual or infrequent or will not recur. We believe that the disclosure of these non-GAAP measures is useful to investors as they form part of the basis for how our management team and Board evaluate our operating performance, allocate resources and administer employee incentive plans.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Selected Operating Data
-
The table below presents the number of our full-service restaurants in operation as of the periods indicated:
Number of restaurants (at end of the period):Number of restaurants (at end of the period):JUNE 26, 2022JUNE 27, 2021Number of restaurants (at end of the period):MARCH 26, 2023MARCH 27, 2022
U.S.U.S.U.S.
Outback SteakhouseOutback Steakhouse  Outback Steakhouse  
Company-ownedCompany-owned563 566 Company-owned564 562 
FranchisedFranchised130 131 Franchised127 130 
TotalTotal693 697 Total691 692 
Carrabba’s Italian GrillCarrabba’s Italian GrillCarrabba’s Italian Grill
Company-ownedCompany-owned198 199 Company-owned199 199 
FranchisedFranchised19 20 Franchised19 20 
TotalTotal217 219 Total218 219 
Bonefish GrillBonefish GrillBonefish Grill
Company-ownedCompany-owned174 179 Company-owned172 175 
FranchisedFranchisedFranchised
TotalTotal181 186 Total177 182 
Fleming’s Prime Steakhouse & Wine BarFleming’s Prime Steakhouse & Wine BarFleming’s Prime Steakhouse & Wine Bar
Company-ownedCompany-owned64 64 Company-owned65 64 
Aussie GrillAussie GrillAussie Grill
Company-owned (1)Company-owned (1)Company-owned (1)
U.S. totalU.S. total1,160 1,170 U.S. total1,158 1,164 
InternationalInternationalInternational
Company-ownedCompany-ownedCompany-owned
Outback Steakhouse - Brazil (2)(1)Outback Steakhouse - Brazil (2)(1)129 113 Outback Steakhouse - Brazil (2)(1)140 123 
Other (3)(2)Other (3)(2)33 33 Other (3)(2)36 33 
FranchisedFranchisedFranchised
Outback Steakhouse - South Korea (1)Outback Steakhouse - South Korea (1)77 76 Outback Steakhouse - South Korea (1)90 78 
Other (3)(2)Other (3)(2)50 55 Other (3)(2)47 52 
International totalInternational total289 277 International total313 286 
System-wide totalSystem-wide total1,449 1,447 System-wide total1,471 1,450 
System-wide total - Company-ownedSystem-wide total - Company-owned1,166 1,158 System-wide total - Company-owned1,183 1,163 
System-wide total - FranchisedSystem-wide total - Franchised283 289 System-wide total - Franchised288 287 
____________________
(1)Previously presented restaurant counts as of June 27, 2021 have been adjusted to exclude off-premises only locations included in the table below.
(2)The restaurant counts for Brazil, including Abbraccio and Aussie Grill restaurants within International Company-owned Other, are reported as of May 31,February 28, 2023 and 2022, and 2021, respectively, to correspond with the balance sheet dates of this subsidiary.
(3)(2)International Company-owned Other included four and two Aussie Grill locations as of JuneMarch 26, 2023 and March 27, 2022, and June 27, 2021.respectively. International Franchised Other included four and three Aussie Grill locations as of JuneMarch 26, 2023 and March 27, 2022, and June 27, 2021.respectively.

The table below presents the number of our off-premises only kitchens in operation as of the periods indicated:
Number of kitchens (at end of the period) (1):Number of kitchens (at end of the period) (1):JUNE 26, 2022JUNE 27, 2021Number of kitchens (at end of the period) (1):MARCH 26, 2023MARCH 27, 2022
U.S.U.S.U.S.
Company-ownedCompany-ownedCompany-owned
InternationalInternationalInternational
Company-ownedCompany-ownedCompany-owned— 
Franchised - South KoreaFranchised - South Korea49 32 Franchised - South Korea25 46 
System-wide totalSystem-wide total52 37 System-wide total26 49 
____________________
(1)Excludes virtual concepts that operate out of existing restaurants and sports venue locations.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Results of Operations

The following table sets forth the percentages of certain items in our Consolidated Statements of Operations in relation to Total revenues or Restaurant sales for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021MARCH 26, 2023MARCH 27, 2022
RevenuesRevenues   Revenues 
Restaurant salesRestaurant sales98.6 %97.9 %98.5 %98.5 %Restaurant sales98.7 %98.5 %
Franchise and other revenuesFranchise and other revenues1.4 2.1 1.5 1.5 Franchise and other revenues1.3 1.5 
Total revenuesTotal revenues100.0 100.0 100.0 100.0 Total revenues100.0 100.0 
Costs and expensesCosts and expenses   Costs and expenses 
Food and beverage costs (1)32.9 29.6 32.4 29.7 
Food and beverage (1)Food and beverage (1)31.3 32.0 
Labor and other related (1)Labor and other related (1)27.8 28.0 27.8 28.0 Labor and other related (1)27.8 27.8 
Other restaurant operating (1)Other restaurant operating (1)23.8 22.1 23.4 22.7 Other restaurant operating (1)23.0 23.1 
Depreciation and amortizationDepreciation and amortization3.7 3.8 3.7 4.0 Depreciation and amortization3.7 3.7 
General and administrativeGeneral and administrative5.3 6.2 5.2 6.0 General and administrative5.3 5.1 
Provision for impaired assets and restaurant closingsProvision for impaired assets and restaurant closings*0.5 0.1 0.4 Provision for impaired assets and restaurant closings0.3 0.2 
Total costs and expensesTotal costs and expenses92.2 88.4 91.4 89.6 Total costs and expenses90.3 90.6 
Income from operationsIncome from operations7.8 11.6 8.6 10.4 Income from operations9.7 9.4 
Loss on extinguishment and modification of debt(9.6)(0.2)(4.7)(0.1)
Loss on fair value adjustment of derivatives, net(1.6)— (0.8)— 
Other income, net— — — *
Interest expense, netInterest expense, net(1.1)(1.4)(1.2)(1.4)Interest expense, net(1.0)(1.2)
(Loss) income before provision for income taxes(4.5)10.0 1.9 8.9 
Income before provision for income taxesIncome before provision for income taxes8.7 8.2 
Provision for income taxesProvision for income taxes1.0 2.1 1.2 1.4 Provision for income taxes1.2 1.4 
Net (loss) income(5.5)7.9 0.7 7.5 
Net incomeNet income7.5 6.8 
Less: net income attributable to noncontrolling interestsLess: net income attributable to noncontrolling interests0.2 0.2 0.2 0.2 Less: net income attributable to noncontrolling interests0.2 0.2 
Net (loss) income attributable to Bloomin’ Brands(5.7)%7.7 %0.5 %7.3 %
Net income attributable to Bloomin’ BrandsNet income attributable to Bloomin’ Brands7.3 %6.6 %
________________
(1)As a percentage of Restaurant sales.
*Less than 1/10th of one percent of Total revenues.

REVENUES

Restaurant salesSales

Following is a summary of the change in Restaurant sales for the periodsperiod indicated:
(dollars in millions)THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
For the periods ended June 27, 2021$1,055.2 $2,034.7 
Change from:
Comparable restaurant sales (1)37.8 179.2 
Restaurant openings (1)14.0 26.7 
Effect of foreign currency translation11.7 8.6 
Restaurant closures (1)(9.8)(16.7)
For the periods ended June 26, 2022$1,108.9 $2,232.5 
____________________
(dollars in millions)THIRTEEN WEEKS ENDED
For the period ended March 27, 2022$1,123.6 
Change from:
Comparable restaurant sales73.3 
Restaurant openings21.0 
Brazil value added tax exemptions (1)9.6 
Effect of foreign currency translation5.5 
Restaurant closures(4.8)
For the period ended March 26, 2023$1,228.2 
________________
(1)Summation See Note 11 - Income Taxes of quarterly changesthe Notes to Consolidated Financial Statements for restaurant openings, closures anddetails regarding value added tax exemptions in connection with recent Brazil tax legislation.

The increase in Restaurant sales during the thirteen weeks ended March 26, 2023, was primarily due to: (i) higher comparable restaurant sales, will(ii) the opening of 47 new restaurants not total to annual amounts as the restaurants that meet the definition of each will differ each period based on when theincluded in our comparable restaurant opened or closed.sales
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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
The increase in Restaurant sales during the thirteen weeks ended June 26, 2022 was primarily due to: (i) higher comparable restaurant sales, primarilybase, (iii) value added tax exemptions in Brazil (ii) the openingas a result of 42 new restaurants not included in our comparable restaurant sales baserecent tax legislation and (iii)(iv) the effect of foreign currency translation of the Brazilian Real relative to the U.S. dollar. The increase in Restaurant sales was partially offset by the closure of 21 restaurants since March 28, 2021.

The increase in Restaurant sales during the twenty-six weeks ended June 26, 2022 was primarily due to: (i) higher comparable restaurant sales, primarily attributable to increases in average check per person, (ii) the opening of 45 new restaurants not included in our comparable restaurant sales base and (iii) the effect of foreign currency translation of the Brazilian Real relative to the U.S. dollar. The increase in Restaurant sales was partially offset by the closure of 2219 restaurants since December 27, 2020.26, 2021.

Average Restaurant Unit Volumes and Operating Weeks

Following is a summary of the average restaurant unit volumes and operating weeks for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021MARCH 26, 2023MARCH 27, 2022
Average restaurant unit volumes (weekly):Average restaurant unit volumes (weekly):   Average restaurant unit volumes (weekly): 
U.S.U.S.U.S.
Outback SteakhouseOutback Steakhouse$77,941 $78,201 $79,246 $75,813 Outback Steakhouse$84,506 $80,552 
Carrabba’s Italian GrillCarrabba’s Italian Grill$66,016 $66,258 $66,954 $63,605 Carrabba’s Italian Grill$72,687 $67,889 
Bonefish GrillBonefish Grill$64,113 $63,772 $65,193 $59,014 Bonefish Grill$70,146 $66,265 
Fleming’s Prime Steakhouse & Wine BarFleming’s Prime Steakhouse & Wine Bar$112,900 $105,891 $115,141 $93,204 Fleming’s Prime Steakhouse & Wine Bar$121,625 $117,382 
InternationalInternationalInternational
Outback Steakhouse - Brazil (1)Outback Steakhouse - Brazil (1)$61,210 $29,569 $57,645 $36,205 Outback Steakhouse - Brazil (1)$63,170 $53,939 
Operating weeks:Operating weeks: Operating weeks: 
U.S.U.S.U.S.
Outback SteakhouseOutback Steakhouse7,317 7,362 14,637 14,745 Outback Steakhouse7,358 7,320 
Carrabba’s Italian GrillCarrabba’s Italian Grill2,578 2,587 5,165 5,174 Carrabba’s Italian Grill2,587 2,587 
Bonefish GrillBonefish Grill2,269 2,337 4,554 4,677 Bonefish Grill2,248 2,285 
Fleming’s Prime Steakhouse & Wine BarFleming’s Prime Steakhouse & Wine Bar832 832 1,664 1,657 Fleming’s Prime Steakhouse & Wine Bar845 832 
InternationalInternationalInternational
Outback Steakhouse - BrazilOutback Steakhouse - Brazil1,644 1,465 3,226 2,877 Outback Steakhouse - Brazil1,788 1,581 
____________________
(1)Translated at average exchange rates of 4.895.21 and 5.455.47 for the thirteen weeks ended JuneMarch 26, 2023 and March 27, 2022, and June 27, 2021, respectively, and 5.15 and 5.36 forrespectively. Excludes the twenty-six weeks ended June 26, 2022 and June 27, 2021, respectively.benefit of the Brazil value added tax exemptions discussed in Note 11 - Income Taxes of the Notes to Consolidated Financial Statements.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Comparable Restaurant Sales, Traffic and Average Check Per Person Increases (Decreases) Increases

Following is a summary of comparable restaurant sales, traffic and average check per person increases (decreases) increases for the periods indicated:
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021MARCH 26, 2023MARCH 27, 2022
Year over year percentage change:Year over year percentage change:Year over year percentage change:
Comparable restaurant sales (stores open 18 months or more):
Comparable restaurant sales (restaurants open 18 months or more):Comparable restaurant sales (restaurants open 18 months or more):
U.S. (1)U.S. (1)U.S. (1)
Outback SteakhouseOutback Steakhouse(1.1)%65.8 %3.9 %28.8 %Outback Steakhouse4.9 %9.2 %
Carrabba’s Italian GrillCarrabba’s Italian Grill(1.0)%84.3 %5.0 %38.4 %Carrabba’s Italian Grill6.7 %11.5 %
Bonefish GrillBonefish Grill(1.1)%141.2 %9.2 %43.5 %Bonefish Grill5.2 %21.3 %
Fleming’s Prime Steakhouse & Wine BarFleming’s Prime Steakhouse & Wine Bar6.0 %182.6 %23.1 %55.6 %Fleming’s Prime Steakhouse & Wine Bar3.6 %45.7 %
Combined U.S.Combined U.S.(0.4)%84.6 %6.4 %34.4 %Combined U.S.5.1 %14.0 %
InternationalInternationalInternational
Outback Steakhouse - Brazil (2)Outback Steakhouse - Brazil (2)95.7 %78.8 %61.1 %2.7 %Outback Steakhouse - Brazil (2)14.3 %35.9 %
Traffic:Traffic: Traffic: 
U.S.U.S.U.S.
Outback SteakhouseOutback Steakhouse(8.7)%51.4 %(5.0)%21.9 %Outback Steakhouse(1.5)%(1.0)%
Carrabba’s Italian GrillCarrabba’s Italian Grill(7.5)%57.2 %(2.5)%27.0 %Carrabba’s Italian Grill1.7 %3.0 %
Bonefish GrillBonefish Grill(8.6)%52.4 %(1.0)%22.4 %Bonefish Grill(0.5)%7.8 %
Fleming’s Prime Steakhouse & Wine BarFleming’s Prime Steakhouse & Wine Bar(2.9)%97.0 %11.1 %33.5 %Fleming’s Prime Steakhouse & Wine Bar0.2 %28.8 %
Combined U.S.Combined U.S.(8.3)%53.6 %(3.5)%23.2 %Combined U.S.(0.7)%1.5 %
InternationalInternationalInternational
Outback Steakhouse - BrazilOutback Steakhouse - Brazil57.8 %63.0 %42.0 %8.9 %Outback Steakhouse - Brazil2.2 %28.7 %
Average check per person (3):Average check per person (3):Average check per person (3):
U.S.U.S.U.S.
Outback SteakhouseOutback Steakhouse7.6 %14.4 %8.9 %6.9 %Outback Steakhouse6.4 %10.2 %
Carrabba’s Italian GrillCarrabba’s Italian Grill6.5 %27.1 %7.5 %11.4 %Carrabba’s Italian Grill5.0 %8.5 %
Bonefish GrillBonefish Grill7.5 %88.8 %10.2 %21.1 %Bonefish Grill5.7 %13.5 %
Fleming’s Prime Steakhouse & Wine BarFleming’s Prime Steakhouse & Wine Bar8.9 %85.6 %12.0 %22.1 %Fleming’s Prime Steakhouse & Wine Bar3.4 %16.9 %
Combined U.S.Combined U.S.7.9 %31.0 %9.9 %11.2 %Combined U.S.5.8 %12.5 %
InternationalInternationalInternational
Outback Steakhouse - BrazilOutback Steakhouse - Brazil37.3 %22.2 %19.2 %(4.5)%Outback Steakhouse - Brazil11.6 %7.6 %
____________________
(1)Relocated restaurants closed more than 60 days are excluded from comparable restaurant sales until at least 18 months after reopening.
(2)Includes trading day impact from calendar period reporting. Excludes the effect of fluctuations in foreign currency rates. Includes trading day impact from calendar period reporting.rates and the benefit of the Brazil value added tax exemptions discussed in Note 11 - Income Taxes of the Notes to Consolidated Financial Statements.
(3)Average check per person includesIncludes the impact of menu pricing changes, product mix and discounts.

Franchise and other revenues
THIRTEEN WEEKS ENDED
(dollars in millions)MARCH 26, 2023MARCH 27, 2022
Franchise revenues$13.5 $13.4 
Other revenues3.0 3.6 
Franchise and other revenues$16.5 $17.0 

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Franchise and other revenues
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in millions)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Franchise revenues$12.6 $12.2 $26.0 $19.0 
Other revenues (1)3.6 9.9 7.2 11.2 
Franchise and other revenues$16.2 $22.1 $33.2 $30.2 
____________________
(1)During the thirteen and twenty-six weeks ended June 27, 2021, we recognized $6.3 million of other revenues in connection with favorable court rulings in Brazil regarding the calculation methodology and taxable base of PIS and COFINS taxes. The amount recognized as a result of the favorable court rulings primarily represents refundable PIS and COFINS taxes for prior years, including accrued interest.

COSTS AND EXPENSES

Food and beverage costs
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in millions)(dollars in millions)JUNE 26, 2022JUNE 27, 2021CHANGEJUNE 26, 2022JUNE 27, 2021CHANGE(dollars in millions)MARCH 26, 2023MARCH 27, 2022CHANGE
Food and beverage costs$364.5 $312.1 $723.8 $604.0 
Food and beverageFood and beverage$384.2 $359.4 
% of Restaurant sales% of Restaurant sales32.9 %29.6 %3.3 %32.4 %29.7 %2.7 %% of Restaurant sales31.3 %32.0 %(0.7)%

Food and beverage costs increaseddecreased as a percentage of Restaurant sales during the thirteen weeks ended JuneMarch 26, 20222023 as compared to the thirteen weeks ended JuneMarch 27, 20212022 primarily due to 4.9% from commodity inflation, partially offset by a decrease as a percentage of Restaurant sales of 1.6%2.1% from increases in average check per person, primarily driven by an increase in menu pricing.

Foodpricing, and beverage costs increased as a percentage of Restaurant sales during the twenty-six weeks ended June 26, 2022as compared to the twenty-six weeks ended June 27, 2021 primarily due to 4.2% from commodity inflation, partially offset by a decrease as a percentage of Restaurant sales of 1.5% from increases in average check per person, primarily driven by an increase in menu pricing.

In aggregate, our menu pricing increases during 2022 are behind our current level of commodity inflation.

Labor and other related expenses
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in millions)JUNE 26, 2022JUNE 27, 2021CHANGEJUNE 26, 2022JUNE 27, 2021CHANGE
Labor and other related$308.8 $295.0 $621.3 $569.6 
% of Restaurant sales27.8 %28.0 %(0.2)%27.8 %28.0 %(0.2)%

Labor and other related expenses decreased as a percentage of Restaurant sales during the thirteen weeks ended June 26, 2022 as compared to the thirteen weeks ended June 27, 2021 primarily due to: (i) 2.3% from leveraging increased restaurant sales due to the net benefit of lapping the impact of COVID-19, primarily in Brazil, and increases in average check per person and (ii) 0.5%0.4% from the impact of certain cost saving initiatives. These decreases were partially offset by an increase as a percentage of Restaurant sales of 2.9%1.9% from commodity inflation.

Labor and other related expenses
THIRTEEN WEEKS ENDED
(dollars in millions)MARCH 26, 2023MARCH 27, 2022CHANGE
Labor and other related$341.5 $312.5 
% of Restaurant sales27.8 %27.8 %— %

Labor and other related expenses were flat as a percentage of Restaurant sales during the thirteen weeks ended March 26, 2023 as compared to the thirteen weeks ended March 27, 2022 primarily due to an increase of 1.6% from higher labor costs, primarily due to wage rate inflation.

Labor and other related expenses decreased This increase was partially offset by a decrease as a percentage of Restaurant sales during the twenty-six weeks ended June 26, 2022 as compared to the twenty-six weeks ended June 27, 2021 primarily due to: (i) 2.1%of 1.5% from leveraging increased restaurant sales due to increases in average check per person, primarily driven by an increase in menu pricing, and the net benefit of lapping the impact of COVID-19 primarily in Brazil and (ii) 0.4%Hong Kong.

Other restaurant operating expenses
THIRTEEN WEEKS ENDED
(dollars in millions)MARCH 26, 2023MARCH 27, 2022CHANGE
Other restaurant operating$282.9 $259.1 
% of Restaurant sales23.0 %23.1 %(0.1)%

Other restaurant operating expenses were flat as a percentage of Restaurant sales during the thirteen weeks ended March 26, 2023 as compared to the thirteen weeks ended March 27, 2022 primarily due to 1.6% from leveraging increased restaurant sales due to increases in average check per person, primarily driven by an increase in menu pricing, and lapping the impact of certain cost saving initiatives. These decreasesCOVID-19 in Brazil and Hong Kong. This decrease was offset by an increase as a percentage of Restaurant sales of 1.6% from higher operating expenses including utilities, primarily due to inflation.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
were partially offset by an increase as a percentage of Restaurant sales of 2.5% from higher labor cost primarily due to wage rate inflation.Depreciation and amortization

Other restaurant operating expenses
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in millions)JUNE 26, 2022JUNE 27, 2021CHANGEJUNE 26, 2022JUNE 27, 2021CHANGE
Other restaurant operating$263.5 $233.5 $522.6 $462.7 
% of Restaurant sales23.8 %22.1 %1.7 %23.4 %22.7 %0.7 %
THIRTEEN WEEKS ENDED
(dollars in millions)MARCH 26, 2023MARCH 27, 2022CHANGE
Depreciation and amortization$46.3 $41.8 $4.5 

Other restaurant operating expensesDepreciation and amortization increased as a percentage of Restaurant sales during the thirteen weeks ended JuneMarch 26, 20222023 as compared to the thirteen weeks ended JuneMarch 27, 20212022 primarily due to 2.4% from higher operating expenses including utilities, primarily due to inflation,additional depreciation expense related to: (i) technology projects, (ii) upgraded kitchen equipment and 0.6% from higher advertising expense, partially offset by a decrease as a percentage of Restaurant sales of 1.5% from leveraging increased(iii) restaurant sales due to the net benefit of lapping the impact of COVID-19, primarily in Brazil,remodels, openings and increases in average check per person.

Other restaurant operating expenses increased as a percentage of Restaurant sales during the twenty-six weeks ended June 26, 2022 as compared to the twenty-six weeks ended June 27, 2021 primarily due to 1.9% from higher operating expenses including utilities, primarily due to inflation, and 0.6% from higher advertising expense, partially offset by a decrease as a percentage of Restaurant sales of 1.9% from leveraging increased restaurant sales due to increases in average check per person and the net benefit of lapping the impact of COVID-19, primarily in Brazil.relocations.

General and administrative

General and administrative expense includes salaries and benefits, management incentive programs, related payroll tax and benefits, other employee-related costs and professional services. Following is a summary of the change in General and administrative expense for the periodsperiod indicated:
(dollars in millions)THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
For the periods ended June 27, 2021$66.5 $123.7 
Change from:
Incentive compensation(6.1)(7.6)
Employee stock-based compensation(4.8)(4.7)
Compensation, benefits and payroll tax2.3 3.7 
Travel and entertainment1.4 3.0 
Other(0.1)(0.2)
For the periods ended June 26, 2022$59.2 $117.9 
(dollars in millions)THIRTEEN WEEKS ENDED
For the period ended March 27, 2022$58.7 
Change from:
Legal and professional fees3.0 
Compensation, benefits and payroll tax2.6 
Travel and entertainment1.2 
Other0.3 
For the period ended March 26, 2023$65.8 

Provision for impaired assets and restaurant closingsIncome from operations
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in millions)(dollars in millions)JUNE 26, 2022JUNE 27, 2021CHANGEJUNE 26, 2022JUNE 27, 2021CHANGE(dollars in millions)MARCH 26, 2023MARCH 27, 2022CHANGE
Provision for impaired assets and restaurant closings$0.2 $5.2 $(5.0)$2.0 $7.4 $(5.4)
Income from operationsIncome from operations$120.6 $107.3 $13.3 
% of Total revenues% of Total revenues9.7 %9.4 %0.3 %

Impairment and closure chargesThe increase in Income from operations generated during the periods presented resultedthirteen weeks ended March 26, 2023 as compared to the thirteen weeks ended March 27, 2022 was primarily due to: (i) increases in comparable restaurant sales, primarily driven by an increase in menu pricing and lapping the impact of COVID-19 in Brazil and Hong Kong, (ii) the impact of certain cost saving initiatives and (iii) value added tax exemptions in Brazil as a result of recent tax legislation. These increases were partially offset by: (i) commodity inflation, (ii) higher labor costs, primarily due to wage rate inflation, and (iii) higher operating expenses including utilities, primarily due to inflation.

During the thirteen weeks ended March 26, 2023, the increase in operating income margin included approximately 0.3% attributable to exemptions from locations identifiedBrazil federal value added taxes (PIS and COFINS) on Restaurant sales provided by recent Brazil tax legislation, partially offset by corresponding limitations on allowable value added tax credits typically recognized as reductions of cost and expense lines throughout our Consolidated Statements of Operations and Comprehensive Income. See Note 11 - Income Taxes of the Notes to Consolidated Financial Statements for closure.further discussion regarding Brazil tax legislation.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Income from operationsProvision for income taxes
THIRTEEN WEEKS ENDED
(dollars in millions)MARCH 26, 2023MARCH 27, 2022CHANGE
Income before provision for income taxes$108.2 $93.6 $14.6 
Provision for income taxes$14.8 $15.9 $(1.1)
Effective income tax rate13.6 %17.0 %(3.4)%

THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in millions)JUNE 26, 2022JUNE 27, 2021CHANGEJUNE 26, 2022JUNE 27, 2021CHANGE
Income from operations$87.7 $124.6 $(36.9)$195.0 $215.6 $(20.6)
% of Total revenues7.8 %11.6 %(3.8)%8.6 %10.4 %(1.8)%

The decrease in Income from operations generated duringeffective income tax rate for the thirteen weeks ended JuneMarch 26, 20222023 decreased by 3.4 percentage points as compared to the thirteen weeks ended JuneMarch 27, 20212022. The decrease was primarily due to: (i) commodity inflation, (ii) higher operating expenses including utilities, (iii) higher labor costs primarily due to wage rate inflation, (iv) higher advertising expense and (v) the impact of favorable court rulings in Brazil related to value-added taxes recorded in other revenues during 2021. These decreases were partially offset by: (i) increases in average check per person, (ii) the net benefit of lapping the impact of COVID-19 in Brazil, (iii) lower incentive compensation and (iv) the impact of certain cost saving initiatives.

The decrease in Income from operations generated during the twenty-six weeks ended June 26, 2022 as compared to the twenty-six weeks ended June 27, 2021 was primarily due to: (i) commodity inflation, (ii) higher labor costs primarily duebenefits of Brazil tax legislation that include a temporary reduction in the Brazilian income tax rate from 34% to wage rate inflation, (iii) higher operating expenses including utilities and (iv) higher advertising expense. These decreases were partially offset by: (i) increases in average check per person, (ii) the net benefit of lapping the impact of COVID-19 in Brazil and (iii) the impact of certain cost saving initiatives.

Loss on extinguishment and modification of debt and Loss on fair value adjustment of derivatives, net

In connection with the 2025 Notes Partial Repurchase, we recognized a loss on extinguishment of debt of $104.7 million and a loss on fair value adjustment of derivatives, net, of $17.7 million during0% applicable to the thirteen weeks ended JuneMarch 26, 2022.

2023. See Note 811 - Convertible Senior NotesIncome Taxes of the Notes to Consolidated Financial Statements for further information.discussion regarding Brazil tax legislation.

Provision for income taxes
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021CHANGEJUNE 26, 2022JUNE 27, 2021CHANGE
Effective income tax rate(23.0)%21.1 %(44.1)%63.2 %15.9 %47.3 %

The effective income tax rate for the thirteen weeks ended June 26, 2022 includes the impact of nondeductible losses associated with the 2025 Notes Partial Repurchase which, relative to a pre-tax book loss during the quarter, resulted in a negative effective income tax rate.

The effective income tax rate for the twenty-six weeks ended June 26, 2022 increased by 47.3 percentage points as compared to the twenty-six weeks ended June 27, 2021. The increase was primarily due to the non-deductible losses
associated with the 2025 Notes Partial Repurchase recorded during the twenty-six weeks ended June 26, 2022.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
SEGMENT PERFORMANCE

The following is a summary of reporting segments:
REPORTABLE SEGMENT (1)CONCEPTGEOGRAPHIC LOCATION
U.S.Outback SteakhouseUnited States of America
Carrabba’s Italian Grill
Bonefish Grill
Fleming’s Prime Steakhouse & Wine Bar
InternationalOutback SteakhouseBrazil, Hong Kong/China
Carrabba’s Italian Grill (Abbraccio)Brazil
_________________
(1)Includes franchise locations.

Revenues for both segments include only transactions with customers and exclude intersegment revenues. Excluded from Income from operations for U.S. and international are certain legal and corporate costs not directly related to the performance of the segments, most stock-based compensation expenses, certain insurance expenses and certain bonus expenses.

Refer to Note 1613 - Segment Reporting of the Notes to Consolidated Financial Statements for reconciliations of segment income from operations to the consolidated operating results.

Restaurant-level operating margin is widely regarded in the industry as a useful metricnon-GAAP measure to evaluate restaurant-level operating efficiency and performance of ongoing restaurant-level operations, and we use it for these purposes, overall and particularly within our two segments. See the Overview-Key Financial Performance Indicators and Non-GAAP Financial Measures sections of Management’s Discussion and Analysis of Financial Condition and Results of Operations for additional details regarding the calculation of restaurant-level operating margin.

U.S. Segment
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Revenues
Restaurant sales$985,927 $990,293 $2,009,562 $1,890,352 
Franchise and other revenues12,700 12,765 25,472 17,624 
Total revenues$998,627 $1,003,058 $2,035,034 $1,907,976 
Restaurant-level operating margin15.1 %21.7 %16.3 %20.5 %
Income from operations$104,620 $165,297 $236,846 $287,032 
Operating income margin10.5 %16.5 %11.6 %15.0 %

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
U.S. Segment
THIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Revenues
Restaurant sales$1,080,569 $1,023,635 
Franchise and other revenues12,427 12,772 
Total revenues$1,092,996 $1,036,407 
Income from operations$133,243 $132,226 
Operating income margin12.2 %12.8 %
Restaurant-level operating income$187,808 $177,715 
Restaurant-level operating margin17.4 %17.4 %

Restaurant sales

Following is a summary of the change in U.S. segment Restaurant sales for the periodsperiod indicated:
(dollars in millions)THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED (1)
For the periods ended June 27, 2021$990.3 $1,890.4 
Change from:
Restaurant closures(9.8)(16.7)
Comparable restaurant sales(1.3)122.2 
Restaurant openings6.7 13.7 
For the periods ended June 26, 2022$985.9 $2,009.6 
____________________
(1)Summation of quarterly changes will not total to annual amounts as the restaurants that meet the definition of each change category will differ each period based on when the restaurant opened or closed.

The decrease in U.S. Restaurant sales during the thirteen weeks ended June 26, 2022 was primarily due to the closure of 21 restaurants since March 28, 2021, partially offset by the opening of 14 new restaurants not included in our comparable restaurant sales base.
(dollars in millions)THIRTEEN WEEKS ENDED
For the period ended March 27, 2022$1,023.7 
Change from:
Comparable restaurant sales50.4 
Restaurant openings11.3 
Restaurant closures(4.8)
For the period ended March 26, 2023$1,080.6 

The increase in U.S. Restaurant sales during the twenty-sixthirteen weeks ended JuneMarch 26, 20222023 was primarily due to: (i)to higher comparable restaurant sales primarily attributable to increases in average check per person and (ii) the opening of 1517 new restaurants not included in our comparable restaurant sales base. The increase in U.S. Restaurant sales was partially offset by the closure of 2218 restaurants since December 27, 2020.26, 2021.

Income from operations

The decreaseincrease in U.S. Income from operations generated during the thirteen and twenty-six weeks ended JuneMarch 26, 20222023 as compared to the thirteen and twenty-six weeks ended JuneMarch 27, 20212022 was primarily due to increases in comparable restaurant sales, primarily driven by an increase in menu pricing, and the impact of certain cost saving initiatives. These increases were partially offset by decreases primarily due to: (i) commodity inflation, (ii) higher labor costcosts, primarily due to wage rate inflation, (iii) higher operating expenses including utilities, primarily due to inflation and (iv) higher advertising expense. These decreases were partially offset by: (i) increasesan increase in average check per person and (ii) the impact of certain cost saving initiatives.asset impairment charges.

International Segment
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Revenues
Restaurant sales$122,991 $64,934 $222,931 $144,326 
Franchise and other revenues3,544 9,374 7,732 12,537 
Total revenues$126,535 $74,308 $230,663 $156,863 
Restaurant-level operating margin17.8 %3.2 %17.4 %9.3 %
Income from operations$14,126 $2,470 $23,010 $6,007 
Operating income margin11.2 %3.3 %10.0 %3.8 %
The decrease in U.S. operating income margin during the thirteen weeks ended March 26, 2023 as compared to the thirteen weeks ended March 27, 2022 was primarily due to an increase in asset impairment charges.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
International Segment
THIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Revenues
Restaurant sales$147,665 $99,940 
Franchise and other revenues4,085 4,188 
Total revenues$151,750 $104,128 
Income from operations$24,508 $8,884 
Operating income margin16.2 %8.5 %
Restaurant-level operating income$34,015 $16,935 
Restaurant-level operating margin23.0 %16.9 %

Restaurant sales

Following is a summary of the change in international segment Restaurant sales for the periodsperiod indicated:
(dollars in millions)THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
For the periods ended June 27, 2021$64.9 $144.3 
Change from:
Comparable restaurant sales (1)39.1 57.0 
Effect of foreign currency translation11.7 8.6 
Restaurant openings (1)7.3 13.0 
For the periods ended June 26, 2022$123.0 $222.9 
____________________
(dollars in millions)THIRTEEN WEEKS ENDED
For the period ended March 27, 2022$99.9 
Change from:
Comparable restaurant sales22.9 
Restaurant openings9.7 
Brazil value added tax exemptions (1)9.6 
Effect of foreign currency translation5.5 
For the period ended March 26, 2023$147.6 
________________
(1)SummationSee Note 11 - Income Taxes of quarterly changesthe Notes to Consolidated Financial Statements for restaurant openings and comparable restaurant sales will not total to annual amounts as the restaurants that meet the definition of each will differ each period based on when the restaurant opened.details regarding value added tax exemptions in connection with recent Brazil tax legislation.

The increase in international Restaurant sales during the thirteen weeks ended JuneMarch 26, 20222023 was primarily due to: (i) higher comparable restaurant sales in Brazil (ii) the effect of foreign currency translation of the Brazilian Real relative to the U.S. dollar and (iii) the opening of 28 new restaurants not included in our comparable restaurant sales base.

The increase in international Restaurant sales during the twenty-six weeks ended June 26, 2022 was primarily due to: (i) higher comparable restaurant sales in Brazil,Hong Kong, (ii) the opening of 30 new restaurants not included in our comparable restaurant sales base, (iii) value added tax exemptions in Brazil as a result of recent tax legislation and (iii)(iv) the effect of foreign currency translation of the Brazilian Real relative to the U.S. dollar.

Income from operations

The increase in international Income from operations generated during the thirteen and twenty-six weeks ended JuneMarch 26, 20222023 as compared to the thirteen and twenty-six weeks ended JuneMarch 27, 20212022 was primarily due to an increase in restaurant-level operating margin, which includes:to: (i) the recovery of in-restaurant dining, (ii) value added tax exemptions in Brazil as a result of recent tax legislation and the net impact of the COVID-19 pandemic during 2021, and (ii)(iii) increases in average check per person,comparable restaurant sales, primarily driven by an increase in menu pricing. These increases were partially offset by decreases primarily due to: (i) higher labor costs, primarily due to wage rate inflation, (ii) commodity inflation. The increase from international restaurant-level operating margin was partially offset by the impact of favorable court rulings in Brazil related to value-added taxes recorded in other revenues during 2021.inflation and (iii) higher advertising expense.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Non-GAAP Financial Measures

Restaurant-levelConsolidated restaurant-level operating income and corresponding margin non-GAAP reconciliations - The following table reconciles consolidated Income from operations and the corresponding margin to restaurant-level operating income and the corresponding margin for the periods indicated:
ConsolidatedTHIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Income from operations$120,633 $107,256 
Operating income margin9.7 %9.4 %
Less:
Franchise and other revenues16,512 16,960 
Plus:
Depreciation and amortization46,302 41,775 
General and administrative65,804 58,674 
Provision for impaired assets and restaurant closings3,324 1,839 
Restaurant-level operating income$219,551 $192,584 
Restaurant-level operating margin17.9 %17.1 %

Segment restaurant-level and operating margin non-GAAP reconciliations - The following tables reconcile consolidated and segment Income from operations and the corresponding marginsmargin to segment restaurant-level operating income and the corresponding marginsmargin for the periods indicated:
ConsolidatedTHIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
U.S.U.S.THIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Income from operationsIncome from operations$87,719 $124,637 $194,975 $215,635 Income from operations$133,243 $132,226 
Operating income marginOperating income margin7.8 %11.6 %8.6 %10.4 %Operating income margin12.2 %12.8 %
Less:Less:Less:
Franchise and other revenuesFranchise and other revenues16,244 22,139 33,204 30,161 Franchise and other revenues12,427 12,772 
Plus:Plus:Plus:
Depreciation and amortizationDepreciation and amortization41,257 40,539 83,032 81,765 Depreciation and amortization38,163 34,758 
General and administrativeGeneral and administrative59,246 66,462 117,920 123,710 General and administrative25,505 23,445 
Provision for impaired assets and restaurant closingsProvision for impaired assets and restaurant closings193 5,177 2,032 7,377 Provision for impaired assets and restaurant closings3,324 58 
Restaurant-level operating incomeRestaurant-level operating income$172,171 $214,676 $364,755 $398,326 Restaurant-level operating income$187,808 $177,715 
Restaurant-level operating marginRestaurant-level operating margin15.5 %20.3 %16.3 %19.6 %Restaurant-level operating margin17.4 %17.4 %
U.S.THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Income from operations$104,620 $165,297 $236,846 $287,032 
Operating income margin10.5 %16.5 %11.6 %15.0 %
Less:
Franchise and other revenues12,700 12,765 25,472 17,624 
Plus:
Depreciation and amortization33,545 33,579 68,303 67,224 
General and administrative23,648 22,953 47,093 44,045 
Provision for impaired assets and restaurant closings191 5,676 249 7,139 
Restaurant-level operating income$149,304 $214,740 $327,019 $387,816 
Restaurant-level operating margin15.1 %21.7 %16.3 %20.5 %
InternationalTHIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(dollars in thousands)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Income from operations$14,126 $2,470 $23,010 $6,007 
Operating income margin11.2 %3.3 %10.0 %3.8 %
Less:
Franchise and other revenues3,544 9,374 7,732 12,537 
Plus:
Depreciation and amortization6,020 5,565 11,556 11,285 
General and administrative5,331 4,116 10,259 8,721 
Provision for impaired assets and restaurant closings— (708)1,775 (1)
Restaurant-level operating income$21,933 $2,069 $38,868 $13,475 
Restaurant-level operating margin17.8 %3.2 %17.4 %9.3 %

InternationalTHIRTEEN WEEKS ENDED
(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Income from operations$24,508 $8,884 
Operating income margin16.2 %8.5 %
Less:
Franchise and other revenues4,085 4,188 
Plus:
Depreciation and amortization5,919 5,536 
General and administrative7,673 4,928 
Provision for impaired assets and restaurant closings— 1,775 
Restaurant-level operating income$34,015 $16,935 
Restaurant-level operating margin23.0 %16.9 %

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Restaurant-level operating margin non-GAAP reconciliations (continued) - The following tables presenttable presents the percentages of certain operating cost financial statement line items in relation to Restaurant sales for the periods indicated:
THIRTEEN WEEKS ENDEDTHIRTEEN WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021MARCH 26, 2023MARCH 27, 2022
Restaurant salesRestaurant sales100.0 %100.0 %Restaurant sales100.0 %100.0 %
Food and beverage costs32.9 %29.6 %
Food and beverageFood and beverage31.3 %32.0 %
Labor and other relatedLabor and other related27.8 %28.0 %Labor and other related27.8 %27.8 %
Other restaurant operatingOther restaurant operating23.8 %22.1 %Other restaurant operating23.0 %23.1 %
Restaurant-level operating marginRestaurant-level operating margin15.5 %20.3 %Restaurant-level operating margin17.9 %17.1 %
TWENTY-SIX WEEKS ENDED
JUNE 26, 2022JUNE 27, 2021
Restaurant sales100.0 %100.0 %
Food and beverage costs32.4 %29.7 %
Labor and other related27.8 %28.0 %
Other restaurant operating23.4 %22.7 %
Restaurant-level operating margin16.3 %19.6 %

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Adjusted income from operations, Adjusted net income and Adjusted diluted earnings per share
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED
(in thousands, except per share data)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021
Income from operations$87,719 $124,637 $194,975 $215,635 
Operating income margin7.8 %11.6 %8.6 %10.4 %
Adjustments:
Legal and other matters (1)— (6,337)— (6,337)
Total income from operations adjustments— (6,337)— (6,337)
Adjusted income from operations$87,719 $118,300 $194,975 $209,298 
Adjusted operating income margin7.8 %11.0 %8.6 %10.2 %
Diluted net (loss) income attributable to Bloomin’ Brands$(63,635)$82,545 $11,876 $152,098 
Convertible senior notes if-converted method interest adjustment, net of tax (2)— — — 691 
Net (loss) income attributable to Bloomin’ Brands(63,635)82,545 11,876 151,407 
Adjustments:
Income from operations adjustments— (6,337)— (6,337)
Loss on extinguishment and modification of debt (3)107,630 2,073 107,630 2,073 
Loss on fair value adjustment of derivatives, net (4)17,685 — 17,685 — 
Total adjustments, before income taxes125,315 (4,264)125,315 (4,264)
Adjustment to provision for income taxes (5)1,322 1,243 1,322 1,243 
Net adjustments126,637 (3,021)126,637 (3,021)
Adjusted net income$63,002 $79,524 $138,513 $148,386 
Diluted (loss) earnings per share (6)$(0.72)$0.75 $0.12 $1.38 
Adjusted diluted earnings per share (7)$0.68 $0.81 $1.48 $1.53 
Diluted weighted average common shares outstanding (6)88,898 109,805 102,045 110,223 
Adjusted diluted weighted average common shares outstanding (7)92,863 98,574 93,792 97,011 
_________________
(1) non-GAAP reconciliations - The thirteen and twenty-six weeks ended June 27, 2021 include the recognition of recoverable PIS and COFINS taxes, including accrued interest, within other revenues as a result of favorable court rulings in Brazil during the second quarter of 2021.
(2)Adjustment for interest expense relatedfollowing table reconciles Net income attributable to the 2025 Notes weighted for the portion of the period priorBloomin’ Brands to our election under the 2025 Notes indenture to settle the principal portion of the 2025 Notes in cash.
(3)The thirteen and twenty-six weeks ended June 26, 2022 include losses in connection with the 2025 Notes Partial Repurchase and Amended Credit Agreement. See Note 8 - Convertible Senior Notes and Note 7 - Long-term Debt, Net, respectively, of the Notes to Consolidated Financial Statements for additional details.
(4)Fair value adjustments to the conversion feature of the 2025 Notes repurchased, as well as the settlements of the related convertible senior note hedges and warrants in connection with the 2025 Notes Partial Repurchase. See Note 8 - Convertible Senior Notes of the Notes to Consolidated Financial Statements for additional details.
(5)Income tax effect of the adjustments for the periods presented. For the thirteen and twenty-six weeks ended June 26, 2022, the primary difference between the GAAP and adjusted effective income tax rates relate to certain non-deductible losses and other tax costs associated with the 2025 Notes Partial Repurchase.
(6)Due to the GAAP net loss, the effect of dilutive securities was excluded from the calculation of GAAP diluted lossearnings per share for the thirteen weeks ended June 26, 2022.periods indicated:
THIRTEEN WEEKS ENDED
(in thousands, except share and per share data)MARCH 26, 2023MARCH 27, 2022
Net income attributable to Bloomin’ Brands$91,311 $75,511 
Diluted earnings per share$0.93 $0.73 
Adjusted diluted earnings per share (1)$0.98 $0.80 
Diluted weighted average common shares outstanding98,011 103,454 
Adjusted diluted weighted average common shares outstanding (1)93,180 94,722 
_________________
(7)(1)Adjusted diluted weighted average common shares outstanding was calculated excluding the dilutive effect of 7,7744,831 and 11,2318,732 shares for the thirteen weeks ended JuneMarch 26, 20222023 and JuneMarch 27, 2021, respectively, and 8,253 and 10,442 shares for the twenty-six weeks ended June 26, 2022, and June 27, 2021, respectively, to be issued upon conversion of the 2025 Notes to satisfy the amount in excess of the principal since our convertible note hedge offsets the dilutive impact of the shares underlying the 2025 Notes. For the twenty-six weeks ended June 27, 2021, adjusted diluted weighted average common shares outstanding was also calculated assuming our February 2021 election to settle the principal portion of the 2025 Notes in cash was in effect for the entire period. For adjusted diluted earnings per share, the calculation includes 3,965 dilutive shares for the thirteen weeks ended June 26, 2022, primarily related to outstanding warrants.
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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
System-Wide Sales - System-wide sales is a non-GAAP financial measure that includes sales of all restaurants operating under our brand names, whether we own them or not. Management uses this information to make decisions about future plans for the development of additional restaurants and new concepts, as well as evaluation of current operations. System-wide sales comprise sales of Company-owned and franchised restaurants. For a summary of sales of Company-owned restaurants, refer to Note 2 - Revenue Recognition of the Notes to Consolidated Financial Statements.

The following table provides a summary of sales of franchised restaurants for the periods indicated, which are not included in our consolidated financial results. Franchise sales within this table do not represent our sales and are
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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
presented only as an indicator of changes in the restaurant system, which management believes is important information regarding the health of our restaurant concepts and in determining our royalties and/or service fees.
THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in millions)(dollars in millions)JUNE 26, 2022JUNE 27, 2021JUNE 26, 2022JUNE 27, 2021(dollars in millions)MARCH 26, 2023MARCH 27, 2022
U.S.U.S.U.S.
Outback SteakhouseOutback Steakhouse$129 $119 $258 $211 Outback Steakhouse$136 $129 
Carrabba’s Italian GrillCarrabba’s Italian Grill13 12 25 22 Carrabba’s Italian Grill13 12 
Bonefish GrillBonefish GrillBonefish Grill
U.S. totalU.S. total145 134 289 238 U.S. total152 144 
InternationalInternationalInternational
Outback Steakhouse - South KoreaOutback Steakhouse - South Korea65 72 143 146 Outback Steakhouse - South Korea94 78 
Other(1)Other(1)28 27 62 51 Other(1)27 34 
International totalInternational total93 99 205 197 International total121 112 
Total franchise sales (1)(2)Total franchise sales (1)(2)$238 $233 $494 $435 Total franchise sales (1)(2)$273 $256 
_____________________
(1)Includes franchise sales for off-premises only kitchens in South Korea.
(2)Franchise sales are not included in Total revenues in the Consolidated Statements of Operations and Comprehensive (Loss) Income.

Liquidity and Capital Resources

Cash and Cash Equivalents

As of JuneMarch 26, 2022,2023, we had $95.3$94.4 million in cash and cash equivalents, of which $41.8$27.1 million was held by foreign affiliates. The international jurisdictions in which we have significant cash do not have any known restrictions that would prohibit repatriation.

As of JuneMarch 26, 2022,2023, we had aggregate accumulatedundistributed foreign earnings of approximately $37.9$25.8 million. This amount consisted primarily of historical earnings from 2017 and prior that were previously taxed in the U.S. under the 2017 Tax Cuts and Jobs Act and post-2017 foreign earnings, which we may repatriate to the U.S. without additional material U.S. federal income tax. These amounts are not considered indefinitely reinvested in our foreign subsidiaries.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Borrowing Capacity and Debt Service

Credit Facilities - Following is a summary of our outstanding credit facilities as of the dates indicated and principal payments and debt issuance during the period indicated:
SENIOR SECURED CREDIT FACILITYTOTAL CREDIT FACILITIES
(dollars in thousands)TERM LOAN AREVOLVING FACILITY2025 NOTES2029 NOTES
Balance as of December 26, 2021$195,000 $80,000 $230,000 $300,000 $805,000 
2022 new debt— 624,500 — — 624,500 
2022 payments(195,000)(304,500)(125,000)— (624,500)
Balance as of June 26, 2022$— $400,000 $105,000 $300,000 $805,000 
Interest rates, as of June 26, 2022 (1)2.74 %5.00 %5.13 %
Principal maturity dateApril 2026May 2025April 2029
SENIOR SECURED CREDIT FACILITYTOTAL CREDIT FACILITIES
(dollars in thousands)REVOLVING CREDIT FACILITY2025 NOTES2029 NOTES
Balance as of December 25, 2022$430,000 $105,000 $300,000 $835,000 
2023 new debt190,000 — — 190,000 
2023 payments(260,000)— — (260,000)
Balance as of March 26, 2023$360,000 $105,000 $300,000 $765,000 
Interest rates, as of March 26, 2023 (1)6.28 %5.00 %5.13 %
Principal maturity dateApril 2026May 2025April 2029
____________________
(1)Interest rate for revolving credit facility represents the weighted average interest rate as of JuneMarch 26, 2022.2023.

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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
As of JuneMarch 26, 2022,2023, we had $580.0$620.2 million in available unused borrowing capacity under our revolving credit facility, net of letters of credit of $20.0$19.8 million.

Credit Agreement Amendment - On April 26, 2022, we and OSI entered into the Amended Credit Agreement, which included an increase of our existing revolvingOur credit facility from $800.0 million to $1.0 billion and a transition from LIBOR to SOFRagreement, as the benchmark rate for purposes of calculating interest under the Senior Secured Credit Facility. At closing, an incremental $192.5 million was drawn on the revolving credit facility to fully repay the outstanding balance of Term loan A. Our total indebtedness remained unchanged as a result of the Amended Credit Agreement. The transition to SOFR did not materially impact the interest rate applied to our borrowings.

See Note 7 - Long-term Debt, Net of the Notes to Consolidated Financial Statements for additional details regarding the Amended Credit Agreement.

Our Amended Credit Agreementamended, contains various financial and non-financial covenants. A violation of these covenants could negatively impact our liquidity by restricting our ability to borrow under the revolving credit facility and cause an acceleration of the amounts due under the credit facilities. See Note 13 - Long-term Debt, Net in our Annual Report on Form 10-K for the year ended December 26, 202125, 2022 for further information.

As of JuneMarch 26, 20222023 and December 26, 2021,25, 2022, we were in compliance with our debt covenants. We believe that we will remain in compliance with our debt covenants during the next 12 months.months and beyond.

2025 Notes - On May 25, 2022, we and the Noteholders entered into the Exchange Agreements in which the Noteholders agreed to exchange $125.0 million in aggregate principal amount of our outstanding 2025 Notes for $196.9 million in cash, plus accrued interest, and approximately 2.3 million shares of our common stock.

Convertible Note Hedge and Warrant Transactions - In connection with the 2025 Notes Partial Repurchase, we entered into the Note Hedge Early Termination Agreements and the Warrant Early Termination Agreements. Upon settlement, we received $131.9 million for the Note Hedge Early Termination Agreements and paid $114.8 million for the Warrant Early Termination Agreements during the thirteen weeks ended June 26, 2022.

See Note 8 - Convertible Senior Notes of the Notes to Consolidated Financial Statements for additional details regarding the 2025 Notes Partial Repurchase and related Note Hedge Early Termination Agreements and Warrant Early Termination Agreements.
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BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Use of Cash

Cash flows generated from operating activities and availability under our revolving credit facility are our principal sources of liquidity, which we use for operating expenses, debt payments, share repurchases, and dividend payments, development of new restaurants, remodeling or relocating older restaurants and investment in technology.

We believe that our expected liquidity sources are adequate to fund debt service requirements, lease obligations, capital expenditures and working capital obligations during the 12 months following this filing. However, our ability to continue to meet these requirements and obligations will depend on, among other things, our ability to achieve anticipated levels of revenue and cash flow and our ability to manage costs and working capital successfully.

Capital Expenditures - We estimate that our capital expenditures will total approximately $200approximately $240 million to $210$260 million in 2022.2023. The amount of actual capital expenditures may be affected by general economic, financial, competitive, legislative and regulatory factors, among other things, including raw material constraints.

Dividends and Share Repurchases - In July 2022,April 2023, our Board declared a quarterly cash dividend of $0.14$0.24 per share, payable on AugustMay 24, 2022.2023. Future dividend payments are dependent on our earnings, financial condition, capital expenditure requirements, surplus and other factors that our Board considers relevant, as well as continued compliance with the financial covenants in our debt agreements.

During the thirteen weeks ended March 26, 2023, we fully utilized the remaining share repurchase authorization under the 2022 Share Repurchase Program. On February 8, 2022,7, 2023, our Board approved the 20222023 Share Repurchase Program under which we are authorized to repurchase up to $125.0 million of our outstanding common stock. The 20222023 Share Repurchase Program will expire on August 9, 2023.7, 2024. As of JuneMarch 26, 2022,2023, we had $77.5$119.4 million remaining available for repurchase under the 20222023 Share Repurchase Program.

Following is a summary of dividends and share repurchases from fiscal year 2015 through JuneMarch 26, 2022:2023:
(dollars in thousands)DIVIDENDS PAIDSHARE REPURCHASESTOTAL
Fiscal year 2015$29,332 $169,999 $199,331 
Fiscal year 201631,379 309,887 341,266 
Fiscal year 201730,988 272,736 303,724 
Fiscal year 201833,312 113,967 147,279 
Fiscal year 201935,734 106,992 142,726 
Fiscal year 202017,480 — 17,480 
Fiscal year 2021— — — 
First fiscal quarter 202212,559 11,702 24,261 
Second fiscal quarter 202212,418 35,749 48,167 
Total (1)$203,202 $1,021,032 $1,224,234 
(dollars in thousands)DIVIDENDS PAIDSHARE REPURCHASESTOTAL
Fiscal years 2015 - 2022$227,961 $1,083,580 $1,311,541 
First fiscal quarter 202321,014 20,645 41,659 
Total (1)$248,975 $1,104,225 $1,353,200 
________________
(1)Subsequent to JuneMarch 26, 2022,2023, we repurchased $14.9$7.2 million of our common stock under a Rule 10b5-1 plan through July 28, 2022.

Deferred Compensation Programs - The deferred compensation obligation due to managing and chef partners was $7.5 million and $15.5 million as of June 26, 2022 and December 26, 2021, respectively. We invest in various corporate-owned life insurance policies, which are held within an irrevocable grantor or rabbi trust account for settlement of our obligations under the deferred compensation plans. The obligation for managing and chef partners’ deferred compensation was fully funded as of June 26, 2022.plan.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued
Summary of Cash Flows and Financial Condition

Cash Flows - The following table presents a summary of our cash flows provided by (used in) operating, investing and financing activities for the periods indicated:
TWENTY-SIX WEEKS ENDEDTHIRTEEN WEEKS ENDED
(dollars in thousands)(dollars in thousands)JUNE 26, 2022JUNE 27, 2021(dollars in thousands)MARCH 26, 2023MARCH 27, 2022
Net cash provided by operating activitiesNet cash provided by operating activities$218,818 $283,182 Net cash provided by operating activities$189,668 $147,135 
Net cash used in investing activitiesNet cash used in investing activities(75,738)(42,625)Net cash used in investing activities(62,945)(39,150)
Net cash used in financing activitiesNet cash used in financing activities(140,922)(248,018)Net cash used in financing activities(116,987)(101,111)
Effect of exchange rate changes on cash and cash equivalentsEffect of exchange rate changes on cash and cash equivalents4,232 128 Effect of exchange rate changes on cash and cash equivalents(30)1,965 
Net increase (decrease) in cash, cash equivalents and restricted cash$6,390 $(7,333)
Net increase in cash, cash equivalents and restricted cashNet increase in cash, cash equivalents and restricted cash$9,706 $8,839 

Operating activities - The decreaseincrease in net cash provided by operating activities during the twenty-sixthirteen weeks ended JuneMarch 26, 20222023 as compared to the twenty-sixthirteen weeks ended JuneMarch 27, 20212022 was primarily due to the timinghigher operational receipts net of operational payments and receipts and increaseddecreased employee compensation payments.

Investing activities - The increase in net cash used in investing activities during the twenty-sixthirteen weeks ended JuneMarch 26, 20222023 as compared to the twenty-sixthirteen weeks ended JuneMarch 27, 20212022 was primarily due to higher capital expenditures.

Financing activities - The decreaseincrease in net cash used in financing activities during the twenty-sixthirteen weeks ended JuneMarch 26, 20222023 as compared the twenty-sixthirteen weeks ended JuneMarch 27, 20212022 was primarily due to net draws on the revolving credit facility during 2022, generally used to settle certain outstanding debt obligations, including the 2025 Notes Partial Repurchase and the related Note Hedge Early Termination Agreements, partially offset byincreases in the repurchase of common stock and payment of cash dividends on our common stock.

Financial Condition - Following is a summary of our current assets, current liabilities and working capital (deficit) as of the periods indicated:
(dollars in thousands)(dollars in thousands)JUNE 26, 2022DECEMBER 26, 2021(dollars in thousands)MARCH 26, 2023DECEMBER 25, 2022
Current assetsCurrent assets$292,926 $352,792 Current assets$247,846 $346,577 
Current liabilitiesCurrent liabilities909,850 984,625 Current liabilities920,433 978,867 
Working capital (deficit)Working capital (deficit)$(616,924)$(631,833)Working capital (deficit)$(672,587)$(632,290)

Working capital (deficit) includes: (i) Unearned revenue primarily from unredeemed gift cards of $309.9$322.6 million and $398.8$394.2 million as of JuneMarch 26, 20222023 and December 26, 2021,25, 2022, respectively, and (ii) current operating lease liabilities of $178.8$182.8 million and $177.0$183.5 million as of JuneMarch 26, 20222023 and December 26, 2021,25, 2022, respectively, with the corresponding operating right-of-use assets recorded as non-current on our Consolidated Balance Sheets. We have, and in the future may continue to have, negative working capital balances (as is common for many restaurant companies). We operate successfully with negative working capital because cash collected on restaurant sales is typically received before payment is due on our current liabilities, and our inventory turnover rates require relatively low investment in inventories. Additionally, ongoing cash flows from restaurant operations and gift card sales are typically used to service debt obligations and to make capital expenditures.

Recently Issued Financial Accounting Standards

For a description of recently issued Financial Accounting Standards that we adopted during the twenty-sixthirteen weeks ended JuneMarch 26, 20222023 and, that are applicable to us and likely to have material effect on our consolidated financial statements, but have not yet been adopted, see Note 1 - Description of the Business and Basis of Presentation of the Notes to Consolidated Financial Statements of this Quarterly Report on Form 10-Q.
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Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to market risk from changes in interest rates, changes incommodity prices, labor inflation and foreign currency exchange rates and changes in commodity prices.interest rates. We believe that there have been no material changes in our market risk since December 26, 2021.25, 2022. See Part II, Item 7A., “Quantitative and Qualitative Disclosures about Market Risk,” in our Annual Report on Form 10-K for the year ended December 26, 202125, 2022 for further information regarding market risk.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We have established and maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”))Act) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of JuneMarch 26, 2022.2023.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during the thirteen weeks ended JuneMarch 26, 20222023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II: OTHER INFORMATION

Item 1.    Legal Proceedings

For a description of our legal proceedings, see Note 1512 - Commitments and Contingencies of the Notes to Consolidated Financial Statements of this Quarterly Report on Form 10-Q.

Item 1A. Risk Factors

In addition to the other information discussed in this report, please consider the factors described in Part I, Item 1A., “Risk Factors”Factors,” in our 20212022 Form 10-K which could materially affect our business, financial condition or future results. There have not been any material changes to the risk factors described in our 20212022 Form 10-K, but these are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may adversely affect our business, financial condition or operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In connection with the 2025 Notes Partial Repurchase, which is described in further detail within Note 8 - Convertible Senior Notes of the Notes to the Consolidated Financial Statements, the Company delivered to the Noteholders an aggregate amount of 2,313,374 shares of its common stock and $196.9 million, plus accrued interest, in cash in exchange for an aggregate principal amount of $125.0 million of the 2025 Notes. The 2025 Notes Partial Repurchase transaction closed on June 14, 2022.

The Company’s shares of common stock issued in connection with the 2025 Notes Partial Repurchase were not registered under the Securities Act of 1933, as amended (the “Securities Act”), and were issued in reliance on the exemption from the registration requirements thereof provided by Section 4(a)(2) of the Securities Act in a transaction by an issuer not involving a public offering.

There were no other sales of equity securities during the thirteen weeks ended JuneMarch 26, 20222023 that were not registered under the Securities Act.

The following table provides information regarding our purchases of common stock during the thirteen weeks ended JuneMarch 26, 2022:2023:
REPORTING PERIODTOTAL NUMBER OF SHARES PURCHASEDAVERAGE PRICE PAID PER SHARETOTAL NUMBER OF SHARES PURCHASED AS PART OF PUBLICLY ANNOUNCED PLANS OR PROGRAMSAPPROXIMATE DOLLAR VALUE OF SHARES THAT MAY YET BE PURCHASED UNDER THE PLANS OR PROGRAMS (1)
March 28, 2022 through April 24, 2022575,005 $21.48 575,005 $100,948,905 
April 25, 2022 through May 22, 2022397,542 $21.26 397,542 $92,499,003 
May 23, 2022 through June 26, 2022788,382 $18.96 788,382 $77,549,262 
Total1,760,929 1,760,929 
REPORTING PERIODTOTAL NUMBER OF SHARES PURCHASEDAVERAGE PRICE PAID PER SHARETOTAL NUMBER OF SHARES PURCHASED AS PART OF PUBLICLY ANNOUNCED PLANS OR PROGRAMSAPPROXIMATE DOLLAR VALUE OF SHARES THAT MAY YET BE PURCHASED UNDER THE PLANS OR PROGRAMS (1)
December 26, 2022 through January 22, 2023314,175 $21.97 314,175 $8,099,645 
January 23, 2023 through February 19, 2023330,114 $24.53 330,114 $125,000,664 
February 20, 2023 through March 26, 2023218,688 $25.81 218,688 $119,355,724 
Total862,977 862,977 
____________________
(1)On February 8, 2022, our Board of Directors authorized the repurchase of up to $125.0 million of our outstanding common stock as announced in our press release issued on February 18, 2022 (the “2022 Share Repurchase Program”). The 2022 Share Repurchase Program willwas set to expire on August 9, 2023. During the thirteen weeks ended March 26, 2023, we fully utilized the remaining share repurchase authorization under the 2022 Share Repurchase Program. On February 7, 2023, our Board approved a new share repurchase authorization of up to $125.0 million of our outstanding common stock as announced in our press release issued February 16, 2023 (the “2023 Share Repurchase Program”). The 2023 Share Repurchase Program will expire on August 7, 2024.

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Item 6. Exhibits
EXHIBIT
NUMBER
DESCRIPTION OF EXHIBITSFILINGS REFERENCED FOR
INCORPORATION BY REFERENCE
3.1April 20, 2022,19, 2023, Form 8-K, Exhibit 3.1
10.13.2April 29, 2022,19, 2023, Form 8-K, Exhibit 10.13.2
10.24.1May 26, 2022, Form 8-K, Exhibit 10.1Filed herewith
31.1Filed herewith
31.2Filed herewith
32.1Furnished herewith
32.2Furnished herewith
101.INSInline XBRL Instance DocumentFiled herewith
101.SCHInline XBRL Taxonomy Extension Schema DocumentFiled herewith
101.CALInline XBRL Taxonomy Extension Calculation Linkbase DocumentFiled herewith
101.DEFInline XBRL Taxonomy Extension Definition Linkbase DocumentFiled herewith
101.LABInline XBRL Taxonomy Extension Label Linkbase DocumentFiled herewith
101.PREInline XBRL Taxonomy Extension Presentation Linkbase DocumentFiled herewith
104Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)Filed herewith
(1) These certifications are not deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section. These certifications will not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates them by reference.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:AugustMay 2, 20222023BLOOMIN’ BRANDS, INC.
            (Registrant)
 By: /s/ Philip Pace
 Philip Pace
Senior Vice President, Chief Accounting Officer
(Principal Accounting Officer)



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