Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 29, 2014 | Aug. 01, 2014 | |
Document Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 29-Jun-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Trading Symbol | 'THI | ' |
Entity Registrant Name | 'Tim Hortons Inc. | ' |
Entity Central Index Key | '0001345111 | ' |
Current Fiscal Year End Date | '--12-28 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 132,817,871 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statement Of Operations (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Revenues | ' | ' | ' | ' |
Sales | 613,829 | 568,562 | 1,154,859 | 1,092,449 |
Franchise revenues | ' | ' | ' | ' |
Rents and royalties | 224,953 | 209,289 | 424,462 | 396,743 |
Franchise fees | 35,565 | 22,288 | 61,428 | 42,484 |
Franchise Revenue, Total | 260,518 | 231,577 | 485,890 | 439,227 |
Total revenues | 874,347 | 800,139 | 1,640,749 | 1,531,676 |
Costs and expenses | ' | ' | ' | ' |
Cost of sales | 527,132 | 489,092 | 1,000,715 | 950,446 |
Operating expenses | 84,411 | 76,986 | 165,669 | 152,719 |
Franchise fee costs | 34,906 | 23,326 | 62,589 | 45,878 |
General and administrative expenses | 40,241 | 38,038 | 79,460 | 76,706 |
Equity (income) | -3,975 | -3,916 | -7,321 | -7,265 |
Corporate reorganization expenses | 0 | 604 | 0 | 10,079 |
Other expense (income), net | -735 | -570 | 1,983 | -1,383 |
Total costs and expenses, net | 681,980 | 623,560 | 1,303,095 | 1,227,180 |
Operating income | 192,367 | 176,579 | 337,654 | 304,496 |
Interest (expense) | -18,648 | -8,922 | -35,324 | -17,585 |
Interest income | 1,138 | 791 | 2,115 | 1,719 |
Income before income taxes | 174,857 | 168,448 | 304,445 | 288,630 |
Income taxes | 49,425 | 43,886 | 86,658 | 77,145 |
Net income | 125,432 | 124,562 | 217,787 | 211,485 |
Net income attributable to noncontrolling interests | 1,682 | 826 | 3,128 | 1,578 |
Net income attributable to Tim Hortons Inc. | 123,750 | 123,736 | 214,659 | 209,907 |
Basic earnings per common share attributable to Tim Hortons Inc. (in Canadian dollars per share) | 0.92 | 0.81 | 1.58 | 1.38 |
Diluted earnings per common share attributable to Tim Hortons Inc. (in Canadian dollars per share) | 0.92 | 0.81 | 1.57 | 1.37 |
Weighted average number of common shares outstanding (in thousands) – Basic (note 3) | 133,899 | 152,083 | 136,007 | 152,597 |
Weighted average number of common shares outstanding (in thousands) – Diluted (note 3) | 134,367 | 152,637 | 136,477 | 153,133 |
Dividends per common share (in Canadian dollars per share) | 0.32 | 0.26 | 0.64 | 0.52 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statement Of Comprehensive Income (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income | 125,432 | 124,562 | 217,787 | 211,485 |
Other comprehensive (loss) income | ' | ' | ' | ' |
Translation adjustments (loss) gain | -17,765 | 15,205 | -2,830 | 23,382 |
Unrealized (losses) gains from cash flow hedges | ' | ' | ' | ' |
(Loss) gain from change in fair value of derivatives | -4,968 | 5,307 | -5,910 | 8,079 |
Amount of net (gain) loss reclassified to earnings during the period | -999 | 378 | -3,700 | 1,041 |
Tax (expense) | 1,763 | -1,333 | 1,476 | -2,325 |
Other comprehensive (loss) income | -21,969 | 19,557 | -10,964 | 30,177 |
Comprehensive income | 103,463 | 144,119 | 206,823 | 241,662 |
Comprehensive income atributable to non-controlling interests | 1,682 | 826 | 3,128 | 1,578 |
Comprehensive income attributable to Tim Hortons Inc. | 101,781 | 143,293 | 203,695 | 240,084 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheet (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Current assets | ' | ' |
Cash and cash equivalents | 25,087 | 50,414 |
Restricted cash and cash equivalents | 85,926 | 155,006 |
Accounts receivable, net | 220,157 | 210,664 |
Notes receivable, net | 7,619 | 4,631 |
Deferred income taxes | 9,985 | 10,165 |
Inventories and other, net | 117,776 | 104,326 |
Advertising fund restricted assets | 39,078 | 39,783 |
Total current assets | 505,628 | 574,989 |
Property and equipment, net | 1,681,010 | 1,685,043 |
Notes receivable, net | 598 | 4,483 |
Deferred income taxes | 11,693 | 11,018 |
Equity investments | 40,372 | 40,738 |
Other assets | 117,452 | 117,552 |
Total assets | 2,356,753 | 2,433,823 |
Current liabilities | ' | ' |
Accounts payable | 171,118 | 204,514 |
Tim Card obligation | 128,517 | 184,443 |
Accrued liabilities | 65,835 | 89,565 |
Advertising fund liabilities | 38,782 | 59,912 |
Short-term borrowings | 15,000 | 30,000 |
Current portion of long-term obligations | 18,336 | 17,782 |
Total current liabilities | 437,588 | 586,216 |
Long-term obligations | ' | ' |
Long-term debt | 1,293,035 | 843,020 |
Capital leases | 125,048 | 121,049 |
Deferred income taxes | 8,123 | 9,929 |
Other long-term liabilities | 108,557 | 112,090 |
Total long-term obligations | 1,534,763 | 1,086,088 |
Commitments and contingencies | ' | ' |
Equity of Tim Hortons Inc. | ' | ' |
Common shares ($2.84 stated value per share), Authorized: unlimited shares. Issued: 133,126,058 and 141,329,010 shares, respectively | 377,442 | 400,738 |
Common shares held in Trust, at cost: 329,089 and 293,816 shares, respectively | -15,422 | -12,924 |
Contributed surplus | 11,914 | 11,033 |
Retained earnings | 131,926 | 474,409 |
Accumulated other comprehensive loss | -123,066 | -112,102 |
Total equity of Tim Hortons Inc. | 382,794 | 761,154 |
Noncontrolling interests | 1,608 | 365 |
Total equity | 384,402 | 761,519 |
Total liabilities and equity | 2,356,753 | 2,433,823 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheet (Parenthetical) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
Statement of Financial Position [Abstract] | ' | ' |
Common shares, stated value per share | 2.84 | 2.84 |
Common shares, issued | 133,126,058 | 141,329,010 |
Common shares held in Trust, shares | 329,089 | 293,816 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statement Of Cash Flows (CAD) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 |
Cash flows provided from (used in) operating activities | ' | ' |
Net income | 217,787 | 211,485 |
Adjustments to reconcile net income to net cash provided from operating activities | ' | ' |
Depreciation and amortization | 79,774 | 72,368 |
Stock-based compensation expense | 886 | 12,535 |
Deferred income taxes | 2,149 | -2,539 |
Changes in operating assets and liabilities | ' | ' |
Restricted cash and cash equivalents | 69,141 | 46,356 |
Accounts receivable | -16,667 | -8,254 |
Inventories and other | -13,593 | -5,218 |
Accounts payable and accrued liabilities | -81,678 | -75,262 |
Taxes | -9,230 | 4,144 |
Settlement of interest rate forwards | -4,851 | 0 |
Deposits with Tax Authority | -1,721 | 0 |
Other | -14,274 | 2,714 |
Net cash provided from operating activities | 227,723 | 258,329 |
Cash flows (used in) provided from investing activities | ' | ' |
Capital expenditures | -94,442 | -88,272 |
Capital expenditures b Advertising fund | -4,438 | -5,224 |
Other investing activities | 3,038 | 6,125 |
Net cash (used in) investing activities | -95,842 | -87,371 |
Cash flows (used in) provided from financing activities | ' | ' |
Repurchase of common shares | -493,476 | -113,803 |
Dividend payments to common shareholders | -86,910 | -79,348 |
Net proceeds from issuance of Debt | 448,299 | 0 |
Short-term (repayments) borrowings, net | -15,000 | 0 |
Principal payments on long-term debt obligations | -8,280 | -8,543 |
Other financing activities | -1,980 | -5,001 |
Net cash (used in) financing activities | -157,347 | -206,695 |
Effect of exchange rate changes on cash | 139 | 2,201 |
(Decrease) in cash and cash equivalents | -25,327 | -33,536 |
Cash and cash equivalents at beginning of period | 50,414 | 120,139 |
Cash and cash equivalents at end of period | 25,087 | 86,603 |
Supplemental disclosures of cash flow information: | ' | ' |
Interest paid | 30,712 | 17,131 |
Income taxes paid | 102,946 | 77,540 |
Non-cash investing and financing activities: | ' | ' |
Capital lease obligations incurred | 14,173 | 19,219 |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statement Of Equity (CAD) | Total | Common Stock | Common Shares Held In Trust | Contributed Surplus | Retained Earnings | AOCI, Translation Adjustment | AOCI, Cash Flow Hedges | Total Equity Of Tim Hortons Inc. | Noncontrolling Interest | Total Equity | ||||
In Thousands, unless otherwise specified | ||||||||||||||
Balance at Dec. 30, 2012 | ' | 435,033 | -13,356 | 10,970 | 893,619 | -135,438 | [1] | -3,590 | [1] | 1,187,238 | 2,853 | [2] | 1,190,091 | |
Balance (in shares) at Dec. 30, 2012 | ' | 153,405 | 317 | ' | ' | ' | ' | ' | ' | ' | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Repurchase of common shares (in shares) | [3] | ' | -12,076 | -43 | ' | ' | ' | ' | ' | ' | ' | |||
Repurchase of common shares | [3] | ' | -34,295 | -2,453 | ' | -686,243 | ' | ' | -722,991 | ' | -722,991 | |||
Disbursed or sold from the Trust (in shares) | [4] | ' | ' | 66 | ' | ' | ' | ' | ' | ' | ' | |||
Disbursed or sold from the Trust | [4] | ' | ' | 2,885 | ' | ' | ' | ' | 2,885 | ' | 2,885 | |||
Stock based compensation | ' | ' | ' | 63 | -712 | ' | ' | -649 | ' | -649 | ||||
Other comprehensive income, before reclassifications | [5] | ' | ' | ' | ' | ' | 31,333 | [1] | -2,407 | [1] | 28,926 | ' | 28,926 | |
Amounts reclassified from AOCI | [5] | ' | ' | ' | ' | ' | ' | -2,000 | [1] | -2,000 | ' | -2,000 | ||
NCI transactions | ' | ' | ' | ' | -483 | ' | ' | -483 | 483 | [2] | 0 | |||
Net income | ' | ' | ' | ' | ' | ' | ' | ' | ' | 428,649 | ||||
Net income attributable to NCI | [2] | ' | ' | ' | ' | ' | ' | ' | ' | 4,280 | ' | |||
Net income attributable to THI | ' | ' | ' | ' | 424,369 | ' | ' | 424,369 | ' | ' | ||||
Dividends and distributions, net | ' | ' | ' | ' | -156,141 | ' | ' | -156,141 | -7,251 | [2] | -163,392 | |||
Balance at Dec. 29, 2013 | 761,519 | 400,738 | -12,924 | 11,033 | 474,409 | -104,105 | [1] | -7,997 | [1] | 761,154 | 365 | [2] | 761,519 | |
Balance (in shares) at Dec. 29, 2013 | ' | 141,329 | 294 | ' | ' | ' | ' | ' | ' | ' | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Repurchase of common shares (in shares) | [3],[6] | ' | -8,203 | -59 | ' | ' | ' | ' | ' | ' | ' | |||
Repurchase of common shares | [3],[6] | ' | -23,296 | -3,548 | ' | -470,178 | ' | ' | -497,022 | ' | -497,022 | |||
Disbursed or sold from the Trust (in shares) | [4] | ' | ' | 24 | ' | ' | ' | ' | ' | ' | ' | |||
Disbursed or sold from the Trust | [4] | ' | ' | 1,050 | ' | ' | ' | ' | 1,050 | ' | 1,050 | |||
Stock based compensation | ' | ' | ' | 881 | 215 | ' | ' | 1,096 | ' | 1,096 | ||||
Other comprehensive income, before reclassifications | [5] | ' | ' | ' | ' | ' | -2,830 | [1] | -5,705 | [1] | -8,535 | ' | -8,535 | |
Amounts reclassified from AOCI | [5] | ' | ' | ' | ' | ' | ' | -2,429 | [1] | -2,429 | ' | -2,429 | ||
NCI transactions | ' | ' | ' | ' | -269 | ' | ' | -269 | 269 | [2] | 0 | |||
Net income | 217,787 | ' | ' | ' | ' | ' | ' | ' | ' | 217,787 | ||||
Net income attributable to NCI | 3,128 | ' | ' | ' | ' | ' | ' | ' | 3,128 | [2] | ' | |||
Net income attributable to THI | 214,659 | ' | ' | ' | 214,659 | ' | ' | 214,659 | ' | ' | ||||
Dividends and distributions, net | ' | ' | ' | ' | -86,910 | ' | ' | -86,910 | -2,154 | [2] | -89,064 | |||
Balance at Jun. 29, 2014 | 384,402 | 377,442 | -15,422 | 11,914 | 131,926 | -106,935 | [1] | -16,131 | [1] | 382,794 | 1,608 | [2] | 384,402 | |
Balance (in shares) at Jun. 29, 2014 | ' | 133,126 | 329 | ' | ' | ' | ' | ' | ' | ' | ||||
[1] | Accumulated other comprehensive income (bAOCIb). | |||||||||||||
[2] | Noncontrolling interests (bNCIb). | |||||||||||||
[3] | Amounts reflected in Retained earnings represent consideration in excess of the stated value. | |||||||||||||
[4] | Amounts are net of tax. | |||||||||||||
[5] | Amounts are net of tax (see note 9). | |||||||||||||
[6] | The 2014 share repurchase program, as described in the Companybs Annual Report on Form 10-K for the year ended December 29, 2013 (bAnnual Reportb), filed with the SEC and the CSA on FebruaryB 25, 2014, commenced on February 28, 2014. |
Basis_of_Presentation
Basis of Presentation | 6 Months Ended |
Jun. 29, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of management, the accompanying Condensed Consolidated Financial Statements contain all adjustments (all of which are normal and recurring in nature) necessary to state fairly the Company’s financial position as at June 29, 2014, and the results of operations, comprehensive income and cash flows for the second quarters ended June 29, 2014 and June 30, 2013. These Condensed Consolidated Financial Statements should be read in conjunction with the audited 2013 Consolidated Financial Statements which are contained in our most recent Annual Report. The December 29, 2013 Condensed Consolidated Balance Sheet included herein was derived from the audited 2013 Consolidated Financial Statements, but does not include all of the year-end disclosures required by U.S. GAAP. | |
Stock-based compensation - performance stock units | |
In May 2014, the Company granted performance stock units ("PSUs") to certain of its employees. PSU payout levels will be based on two forward looking performance measures: return on assets and total shareholder return. PSUs are expensed on a straight-line basis over the relevant vesting period. |
Income_Taxes
Income Taxes | 6 Months Ended |
Jun. 29, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
INCOME TAXES | |
The effective income tax rate was 28.3% for the second quarter ended June 29, 2014 (second quarter fiscal 2013: 26.1%) and 28.5% for the year-to-date period ended June 29, 2014 (year-to-date period fiscal 2013: 26.7%). The increase in the effective tax rate for the 2014 quarter-to-date and year-to-date periods as compared to the respective 2013 periods is primarily due to the favourable impact of a change in reserve balances in 2013 and an increase in costs in 2014 related to the Company’s new long-term debt, for which a full tax benefit cannot be recognized. |
Earnings_Per_Common_Share_Attr
Earnings Per Common Share Attributable to Tim Hortons Inc. | 6 Months Ended | |||||||||||||||
Jun. 29, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Earnings Per Common Share Attributable to Tim Hortons Inc. | ' | |||||||||||||||
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO TIM HORTONS INC. | ||||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
Net income attributable to Tim Hortons Inc. | $ | 123,750 | $ | 123,736 | $ | 214,659 | $ | 209,907 | ||||||||
Weighted average shares outstanding for computation of basic earnings per common share attributable to Tim Hortons Inc. (in thousands) | 133,899 | 152,083 | 136,007 | 152,597 | ||||||||||||
Dilutive impact of restricted stock units (“RSUs”) and PSUs (in thousands) | 260 | 295 | 252 | 286 | ||||||||||||
Dilutive impact of stock options with tandem stock appreciation rights (“SARs”) (in thousands) | 208 | 259 | 218 | 250 | ||||||||||||
Weighted average shares outstanding for computation of diluted earnings per common share attributable to Tim Hortons Inc. (in thousands) | 134,367 | 152,637 | 136,477 | 153,133 | ||||||||||||
Basic earnings per common share attributable to Tim Hortons Inc. | $ | 0.92 | $ | 0.81 | $ | 1.58 | $ | 1.38 | ||||||||
Diluted earnings per common share attributable to Tim Hortons Inc. | $ | 0.92 | $ | 0.81 | $ | 1.57 | $ | 1.37 | ||||||||
Notes_Receivable_Net
Notes Receivable, Net | 6 Months Ended | |||||||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||||||
Receivables [Abstract] | ' | |||||||||||||||||||||||
Notes Receivable, Net | ' | |||||||||||||||||||||||
NOTES RECEIVABLE, NET | ||||||||||||||||||||||||
As at | ||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||
Gross | VIEs(2) | Total | Gross | VIEs(2) | Total | |||||||||||||||||||
Franchise Incentive Program (“FIP”) notes(1) | $ | 15,702 | $ | (12,824 | ) | $ | 2,878 | $ | 16,677 | $ | (13,668 | ) | $ | 3,009 | ||||||||||
Other notes receivable(3) | 7,465 | (715 | ) | 6,750 | 8,256 | (649 | ) | 7,607 | ||||||||||||||||
Notes receivable | $ | 23,167 | $ | (13,539 | ) | 9,628 | $ | 24,933 | $ | (14,317 | ) | 10,616 | ||||||||||||
Allowance | (1,411 | ) | (1,502 | ) | ||||||||||||||||||||
Notes receivable, net | $ | 8,217 | $ | 9,114 | ||||||||||||||||||||
Current portion, net | $ | 7,619 | $ | 4,631 | ||||||||||||||||||||
Long-term portion, net | $ | 598 | $ | 4,483 | ||||||||||||||||||||
As at | ||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||
Class and Aging | Gross | VIEs(2) | Total | Gross | VIEs(2) | Total | ||||||||||||||||||
Current status (FIP notes and other) | $ | 8,222 | $ | (1,353 | ) | $ | 6,869 | $ | 9,688 | $ | (2,081 | ) | $ | 7,607 | ||||||||||
Past-due status < 90 days (FIP notes) | 329 | (329 | ) | — | 328 | — | 328 | |||||||||||||||||
Past-due status > 90 days (FIP notes) | 14,616 | (11,857 | ) | 2,759 | 14,917 | (12,236 | ) | 2,681 | ||||||||||||||||
Notes receivable | $ | 23,167 | $ | (13,539 | ) | $ | 9,628 | $ | 24,933 | $ | (14,317 | ) | $ | 10,616 | ||||||||||
Allowance | (1,411 | ) | (1,502 | ) | ||||||||||||||||||||
Notes receivable, net | $ | 8,217 | $ | 9,114 | ||||||||||||||||||||
________________ | ||||||||||||||||||||||||
(1) | The Company has outstanding FIP arrangements with certain U.S. restaurant owners, which generally provided interest-free financing for the purchase of certain restaurant equipment, furniture, trade fixtures and signage. | |||||||||||||||||||||||
(2) | The notes payable to the Company by VIEs are eliminated on consolidation, which reduces the Notes receivable, net recognized on the Condensed Consolidated Balance Sheet (see note 12). | |||||||||||||||||||||||
(3) | Relates primarily to notes issued to vendors in conjunction with the financing of property sales, and on various equipment and other financing programs. |
Inventories_and_Other_Net
Inventories and Other, Net | 6 Months Ended | |||||||
Jun. 29, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories and Other, Net | ' | |||||||
INVENTORIES AND OTHER, NET | ||||||||
As at | ||||||||
June 29, 2014 | December 29, 2013 | |||||||
Raw materials | $ | 25,061 | $ | 22,789 | ||||
Finished goods | 78,332 | 69,348 | ||||||
103,393 | 92,137 | |||||||
Inventory obsolescence provision | (1,418 | ) | (1,754 | ) | ||||
Inventories, net | 101,975 | 90,383 | ||||||
Prepaids and other | 15,801 | 13,943 | ||||||
Total Inventories and other, net | $ | 117,776 | $ | 104,326 | ||||
Accounts_Payable
Accounts Payable | 6 Months Ended | |||||||
Jun. 29, 2014 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Schedule of Accounts Payable and Accrued Liabilities | ' | |||||||
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | ||||||||
Accounts payable | ||||||||
As at | ||||||||
June 29, 2014 | December 29, 2013 | |||||||
Accounts payable | $ | 137,112 | $ | 142,131 | ||||
Construction holdbacks and accruals | 33,065 | 57,527 | ||||||
Corporate reorganization accrual | 941 | 4,856 | ||||||
Total Accounts payable | $ | 171,118 | $ | 204,514 | ||||
Tim Card obligation | ||||||||
The decrease in our Tim Card obligation, and resulting decrease in Restricted cash and cash equivalents, is primarily driven by Tim Card redemptions, which can be seasonal. In addition, Restricted cash and cash equivalents decreased due to additional borrowings by the Tim Hortons Advertising and Promotion Fund (Canada) Inc. (“Ad Fund”) (see note 12). | ||||||||
Accrued liabilities | ||||||||
As at | ||||||||
June 29, 2014 | 29-Dec-13 | |||||||
Salaries and wages | $ | 14,276 | $ | 22,553 | ||||
Taxes payable | 5,316 | 14,542 | ||||||
De-branding accruals(1) | 1,947 | 9,538 | ||||||
Other accrued liabilities(2) | 44,296 | 42,932 | ||||||
Total Accrued liabilities | $ | 65,835 | $ | 89,565 | ||||
________________ | ||||||||
(1) | Accruals related to Cold Stone Creamery® de-branding activity in Tim Hortons locations in Canada. | |||||||
(2) | Includes accruals for contingent rent, current portion of the Maidstone Bakeries supply contract, deferred revenues, deposits, the current portion of deferred income taxes, and various equipment and other accruals. |
Long_Term_Debt_Notes
Long Term Debt (Notes) | 6 Months Ended |
Jun. 29, 2014 | |
Debt Disclosure [Abstract] | ' |
Long-term Debt [Text Block] | ' |
LONG TERM DEBT | |
The Company offered Senior Unsecured Notes, Series 3, due April 1, 2019 (“Series 3 Notes”) on a private placement basis in the first quarter of 2014 for total net proceeds of $449.9 million, which included a discount of $0.1 million. A portion of the proceeds from the Series 3 Notes were used to retire the balance of our 364-day $400.0 million revolving bank facility. Please refer to Note 7, Long term debt, in the interim financial statements for the quarter ended March 30, 2014, filed on Form 10-Q with the SEC and CSA on May 7, 2014, for further information. |
Fair_Values
Fair Values | 6 Months Ended | |||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||
Fair Values | ' | |||||||||||||||||||
FAIR VALUES | ||||||||||||||||||||
Financial assets and liabilities measured at fair value | ||||||||||||||||||||
As at | ||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||
Fair value | Fair value | Fair value | Fair value | |||||||||||||||||
hierarchy | asset (liability)(1) | hierarchy | asset (liability)(1) | |||||||||||||||||
Derivatives | ||||||||||||||||||||
Forward currency contracts(2) | Level 2 | $ | (2,030 | ) | Level 2 | $ | 4,181 | |||||||||||||
Interest rate swap(3) | Level 2 | (204 | ) | Level 2 | (49 | ) | ||||||||||||||
Interest rate forwards(4) | n/a | — | Level 2 | 285 | ||||||||||||||||
Total return swaps (“TRS”)(5) | Level 2 | 17,147 | Level 2 | 21,393 | ||||||||||||||||
Total Derivatives | $ | 14,913 | $ | 25,810 | ||||||||||||||||
________________ | ||||||||||||||||||||
(1) | The Company values its derivatives using valuations that are calibrated to the initial trade prices. Subsequent valuations are based on observable inputs to the valuation model. | |||||||||||||||||||
(2) | The fair value of forward currency contracts is determined using prevailing exchange rates. | |||||||||||||||||||
(3) | The fair value is estimated using discounted cash flows and market-based observable inputs, including interest rate yield curves and discount rates. | |||||||||||||||||||
(4) | The interest rate forwards were settled as part of the issuance of the Series 3 Notes (see note 7). | |||||||||||||||||||
(5) | The fair value of the TRS is determined using the Company’s common share closing price on the last business day of the fiscal period, as quoted on the Toronto Stock Exchange. | |||||||||||||||||||
Other financial assets and liabilities not measured at fair value | ||||||||||||||||||||
As at June 29, 2014 and December 29, 2013, the carrying values of Cash and cash equivalents and Restricted cash and cash equivalents approximated their fair values due to the short-term nature of these investments. The following table summarizes the fair value and carrying value of other financial assets and liabilities that are not recognized at fair value on a recurring basis on the Condensed Consolidated Balance Sheet: | ||||||||||||||||||||
As at | ||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||
Fair value | Fair value | Carrying | Fair value | Fair value | Carrying | |||||||||||||||
hierarchy | asset (liability) | value | hierarchy | asset (liability) | value | |||||||||||||||
Bearer deposit notes(1) | Level 2 | $ | 42,520 | $ | 42,520 | Level 2 | $ | 41,403 | $ | 41,403 | ||||||||||
Notes receivable, net(2) | Level 3 | $ | 8,217 | $ | 8,217 | Level 3 | $ | 9,114 | $ | 9,114 | ||||||||||
Series 1 Notes(3) | Level 2 | $ | (317,877 | ) | $ | (301,022 | ) | Level 2 | $ | (315,519 | ) | $ | (301,196 | ) | ||||||
Series 2 Notes(3) | Level 2 | $ | (474,687 | ) | $ | (449,898 | ) | Level 2 | $ | (445,419 | ) | $ | (449,892 | ) | ||||||
Series 3 Notes(3) | Level 2 | $ | (453,614 | ) | $ | (449,880 | ) | n/a | $ | — | $ | — | ||||||||
Advertising fund term debt(4) | Level 3 | $ | (27,673 | ) | $ | (27,673 | ) | Level 3 | $ | (30,189 | ) | $ | (30,189 | ) | ||||||
Other debt(5) | Level 3 | $ | (138,650 | ) | $ | (72,664 | ) | Level 3 | $ | (126,548 | ) | $ | (69,794 | ) | ||||||
________________ | ||||||||||||||||||||
(1) | The Company holds these notes as collateral to reduce the carrying costs of the TRS. The interest rate on these notes resets every 90 days; therefore, the fair value of these notes, using a market approach, approximates the carrying value. | |||||||||||||||||||
(2) | Management generally estimates the current value of notes receivable, using a cost approach, based primarily on the estimated depreciated replacement cost of the underlying equipment held as collateral. | |||||||||||||||||||
(3) | The fair value of the senior unsecured notes, using a market approach, is based on publicly disclosed trades between arm’s length institutions as documented on Bloomberg L.P. | |||||||||||||||||||
(4) | Management estimates the fair value of this variable rate debt using a market approach, based on prevailing interest rates plus an applicable margin. | |||||||||||||||||||
(5) | Management estimates the fair value of its Other debt, primarily consisting of contributions received related to the construction costs of certain restaurants, using an income approach, by discounting future cash flows using a Company risk-adjusted rate over the remaining term of the debt. |
Derivatives
Derivatives | 6 Months Ended | |||||||||||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||||||||||||||||
Derivatives | ' | |||||||||||||||||||||||||||
DERIVATIVES | ||||||||||||||||||||||||||||
As at | ||||||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||||||
Asset | Liability | Net | Classification on | Asset | Liability | Net | Classification on | |||||||||||||||||||||
asset | Condensed | asset | Condensed | |||||||||||||||||||||||||
(liability) | Consolidated | (liability) | Consolidated | |||||||||||||||||||||||||
Balance Sheet | Balance Sheet | |||||||||||||||||||||||||||
Derivatives designated as cash flow hedging instruments | ||||||||||||||||||||||||||||
Forward currency contracts(1) | $ | 919 | $ | (2,142 | ) | $ | (1,223 | ) | Accounts payable, net | $ | 4,181 | $ | — | $ | 4,181 | Accounts receivable, net | ||||||||||||
Interest rate swap(2) | $ | — | $ | (204 | ) | $ | (204 | ) | Other long-term liabilities | $ | — | $ | (49 | ) | $ | (49 | ) | Other long-term liabilities | ||||||||||
Interest rate forwards(3) | $ | — | $ | — | $ | — | n/a | $ | 285 | $ | — | $ | 285 | Accounts receivable, net | ||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||||||||||||||
TRS(4) | $ | 17,160 | $ | (13 | ) | $ | 17,147 | Other assets | $ | 21,393 | $ | — | $ | 21,393 | Other assets | |||||||||||||
Forward currency contracts(1) | $ | 15 | $ | (822 | ) | $ | (807 | ) | Accounts payable, net | $ | — | $ | — | $ | — | n/a | ||||||||||||
________________ | ||||||||||||||||||||||||||||
(1) | Notional value as at June 29, 2014 of $167.8 million (December 29, 2013: $154.0 million), with maturities ranging between June 2014 and April 2015; no associated cash collateral. | |||||||||||||||||||||||||||
(2) | Notional value as at June 29, 2014 of $27.5 million (December 29, 2013: $30.0 million), with maturities through fiscal 2019; no associated cash collateral. | |||||||||||||||||||||||||||
(3) | The interest rate forwards were settled in the first quarter of 2014 (notional amount at December 29, 2013: $90.0 million). | |||||||||||||||||||||||||||
(4) | The notional value and associated cash collateral, in the form of bearer deposit notes (see note 8), was $42.5 million as at June 29, 2014 (December 29, 2013: $41.4 million). The TRS have maturities annually, in May, between fiscal 2015 and fiscal 2021. | |||||||||||||||||||||||||||
Second quarter ended June 29, 2014 | Second quarter ended June 30, 2013 | |||||||||||||||||||||||||||
Derivatives designated as cash flow | Classification on | Amount of | Amount of net | Total effect | Amount of | Amount of net | Total effect | |||||||||||||||||||||
hedging instruments(1) | Condensed | gain (loss) | (gain) loss | on OCI(2) | gain (loss) | (gain) loss | on OCI(2) | |||||||||||||||||||||
Consolidated | recognized | reclassified | recognized | reclassified | ||||||||||||||||||||||||
Statement of | in OCI(2) | to earnings | in OCI(2) | to earnings | ||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||
Forward currency contracts | Cost of sales | $ | (4,921 | ) | $ | (1,716 | ) | $ | (6,637 | ) | $ | 4,851 | $ | 144 | $ | 4,995 | ||||||||||||
Interest rate swap(3) | Interest (expense) | (47 | ) | 50 | 3 | 456 | 61 | 517 | ||||||||||||||||||||
Interest rate forwards(4) | Interest (expense) | — | 667 | 667 | — | 173 | 173 | |||||||||||||||||||||
Total | (4,968 | ) | (999 | ) | (5,967 | ) | 5,307 | 378 | 5,685 | |||||||||||||||||||
Income tax effect | Income taxes | 1,321 | 442 | 1,763 | (1,279 | ) | (54 | ) | (1,333 | ) | ||||||||||||||||||
Net of income taxes | $ | (3,647 | ) | $ | (557 | ) | $ | (4,204 | ) | $ | 4,028 | $ | 324 | $ | 4,352 | |||||||||||||
Year-to-date period ended June 29, 2014 | Year-to-date period ended June 30, 2013 | |||||||||||||||||||||||||||
Derivatives designated as cash flow | Classification on | Amount of | Amount of net | Total effect | Amount of | Amount of net | Total effect | |||||||||||||||||||||
hedging instruments(1) | Condensed | gain (loss) | (gain) loss | on OCI(2) | gain (loss) | (gain) loss | on OCI(2) | |||||||||||||||||||||
Consolidated | recognized | reclassified | recognized | reclassified | ||||||||||||||||||||||||
Statement of | in OCI(2) | to earnings | in OCI(2) | to earnings | ||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||
Forward currency contracts | Cost of sales | $ | (516 | ) | $ | (4,888 | ) | $ | (5,404 | ) | $ | 8,124 | $ | 615 | $ | 8,739 | ||||||||||||
Interest rate swap(3) | Interest (expense) | (258 | ) | 103 | (155 | ) | (45 | ) | 80 | 35 | ||||||||||||||||||
Interest rate forwards(4) | Interest (expense) | (5,136 | ) | 1,085 | (4,051 | ) | — | 346 | 346 | |||||||||||||||||||
Total | (5,910 | ) | (3,700 | ) | (9,610 | ) | 8,079 | 1,041 | 9,120 | |||||||||||||||||||
Income tax effect | Income taxes | 205 | 1,271 | 1,476 | (2,141 | ) | (184 | ) | (2,325 | ) | ||||||||||||||||||
Net of income taxes | $ | (5,705 | ) | $ | (2,429 | ) | $ | (8,134 | ) | $ | 5,938 | $ | 857 | $ | 6,795 | |||||||||||||
_______________ | ||||||||||||||||||||||||||||
(1) | Excludes amounts related to ineffectiveness, as they were not significant. | |||||||||||||||||||||||||||
(2) | Other comprehensive income (“OCI”). | |||||||||||||||||||||||||||
(3) | The Ad Fund entered into an amortizing interest rate swap to fix a portion of the interest expense on its term debt. | |||||||||||||||||||||||||||
(4) | The Company entered into and settled interest rate forwards relating to the issuance of its long-term debt. | |||||||||||||||||||||||||||
Derivatives not designated as cash flow hedging instruments | Classification on Condensed Consolidated | Second quarter ended | Year-to-date period ended | |||||||||||||||||||||||||
Statement of Operations | 29-Jun-14 | 30-Jun-13 | 29-Jun-14 | 30-Jun-13 | ||||||||||||||||||||||||
TRS | General and administrative expenses | $ | 1,998 | $ | (1,482 | ) | $ | 4,246 | $ | (8,235 | ) | |||||||||||||||||
Forward currency contracts | Cost of sales | 167 | (69 | ) | 167 | (349 | ) | |||||||||||||||||||||
Forward currency contracts | Other (income) expense | 640 | — | 640 | — | |||||||||||||||||||||||
Total loss (gain), net | $ | 2,805 | $ | (1,551 | ) | $ | 5,053 | $ | (8,584 | ) | ||||||||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 29, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
COMMITMENTS AND CONTINGENCIES | |
The Company and its subsidiaries are parties to various legal actions and complaints arising in the ordinary course of business. As of the date hereof, the Company believes that the ultimate resolution of such matters will not materially affect the Company’s financial condition and earnings. |
StockBased_Compensation
Stock-Based Compensation | 6 Months Ended | |||||||||||||||
Jun. 29, 2014 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||
Stock-Based Compensation | ' | |||||||||||||||
STOCK-BASED COMPENSATION | ||||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
RSUs and PSUs | $ | 1,386 | $ | 2,478 | $ | 2,656 | $ | 3,580 | ||||||||
Stock options and tandem SARs | (362 | ) | 2,264 | (1,864 | ) | 7,339 | ||||||||||
Deferred share units (“DSUs”) | 108 | 406 | 94 | 1,616 | ||||||||||||
Total stock-based compensation expense | $ | 1,132 | $ | 5,148 | $ | 886 | $ | 12,535 | ||||||||
TRS loss (gain)(1) | $ | 1,998 | $ | (1,482 | ) | $ | 4,246 | $ | (8,235 | ) | ||||||
________________ | ||||||||||||||||
(1) | The Company has entered into TRS contracts as economic hedges, covering 1,027,000 of the Company’s underlying common shares (June 30, 2013: 1,008,000), which represents a portion of its outstanding stock options with tandem SARs, and substantially all of its cash obligation related to DSUs. See note 9 for the revaluation of the TRS contracts. | |||||||||||||||
During the second quarter of 2014, the Company granted a total of 62,000 RSUs and 72,000 PSUs (2013: total of 80,000 RSUs and 61,000 performance-conditioned restricted stock units), with a weighted average grant day fair value per unit of $60.09 (2013: $56.12). Also during the second quarter of 2014, the Company granted 578,000 stock options and tandem SARs (2013: 241,000), with a weighted average exercise per unit of $60.09 (2013: $56.12). |
Variable_Interest_Entities
Variable Interest Entities | 6 Months Ended | |||||||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||||||||||||||
Variable Interest Entities | ' | |||||||||||||||||||||||
VARIABLE INTEREST ENTITIES | ||||||||||||||||||||||||
VIEs for which the Company is the primary beneficiary | ||||||||||||||||||||||||
The revenues and expenses associated with the Company’s consolidated Non-owned restaurants and advertising funds presented on a gross basis, prior to consolidation adjustments, are as follows: | ||||||||||||||||||||||||
Second quarter ended | ||||||||||||||||||||||||
June 29, 2014 | June 30, 2013 | |||||||||||||||||||||||
Restaurant | Advertising | Total | Restaurant | Advertising | Total | |||||||||||||||||||
VIEs(1) | fund VIEs(2) | VIEs | VIEs(1) | fund VIEs(2) | VIEs | |||||||||||||||||||
Sales | $ | 94,328 | $ | — | $ | 94,328 | $ | 93,464 | $ | — | $ | 93,464 | ||||||||||||
Advertising levies | — | 2,906 | 2,906 | — | 2,569 | 2,569 | ||||||||||||||||||
Total revenues | 94,328 | 2,906 | 97,234 | 93,464 | 2,569 | 96,033 | ||||||||||||||||||
Cost of sales | 92,242 | — | 92,242 | 92,480 | — | 92,480 | ||||||||||||||||||
Operating expenses | — | 2,704 | 2,704 | — | 2,293 | 2,293 | ||||||||||||||||||
Operating income | 2,086 | 202 | 2,288 | 984 | 276 | 1,260 | ||||||||||||||||||
Interest expense | 33 | 202 | 235 | — | 276 | 276 | ||||||||||||||||||
Income before taxes | 2,053 | — | 2,053 | 984 | — | 984 | ||||||||||||||||||
Income taxes | 371 | — | 371 | 158 | — | 158 | ||||||||||||||||||
Net income attributable to noncontrolling interests | $ | 1,682 | $ | — | $ | 1,682 | $ | 826 | $ | — | $ | 826 | ||||||||||||
Year-to-date period ended | ||||||||||||||||||||||||
29-Jun-14 | 30-Jun-13 | |||||||||||||||||||||||
Restaurant | Advertising | Total | Restaurant | Advertising | Total | |||||||||||||||||||
VIEs(1) | fund VIEs(2) | VIEs | VIEs(1) | fund VIEs(2) | VIEs | |||||||||||||||||||
Sales | $ | 177,709 | $ | — | $ | 177,709 | $ | 180,224 | $ | — | $ | 180,224 | ||||||||||||
Advertising levies | — | 5,898 | 5,898 | — | 5,100 | 5,100 | ||||||||||||||||||
Total revenues | 177,709 | 5,898 | 183,607 | 180,224 | 5,100 | 185,324 | ||||||||||||||||||
Cost of sales | 173,855 | — | 173,855 | 178,346 | — | 178,346 | ||||||||||||||||||
Operating expenses | — | 5,466 | 5,466 | — | 4,392 | 4,392 | ||||||||||||||||||
Operating income | 3,854 | 432 | 4,286 | 1,878 | 708 | 2,586 | ||||||||||||||||||
Interest expense | 33 | 432 | 465 | — | 708 | 708 | ||||||||||||||||||
Income before taxes | 3,821 | — | 3,821 | 1,878 | — | 1,878 | ||||||||||||||||||
Income taxes | 693 | — | 693 | 300 | — | 300 | ||||||||||||||||||
Net income attributable to noncontrolling interests | $ | 3,128 | $ | — | $ | 3,128 | $ | 1,578 | $ | — | $ | 1,578 | ||||||||||||
______________ | ||||||||||||||||||||||||
(1) | Includes rents, royalties, advertising expenses and product purchases from the Company which are eliminated upon the consolidation of these VIEs. | |||||||||||||||||||||||
(2) | The advertising levies, depreciation, interest costs, capital expenditures and financing associated with the Ad Fund’s program to acquire and install LCD screens, media engines, drive-thru menu boards and ancillary equipment for our restaurants (the “Expanded Menu Board Program”) are presented on a gross basis. Generally, the advertising levies that are not related to the Expanded Menu Board Program are netted with advertising and marketing expenses incurred by the advertising funds in operating expenses, as these contributions are designated for specific purposes. The Company acts as an agent with regard to these contributions. | |||||||||||||||||||||||
The assets and liabilities associated with the Company’s consolidated Non-owned restaurants and advertising funds presented on a gross basis, prior to consolidation adjustments, are as follows: | ||||||||||||||||||||||||
As at | ||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||
Restaurant | Advertising | Restaurant | Advertising | |||||||||||||||||||||
VIEs(1) | fund VIEs | VIEs(1) | fund VIEs | |||||||||||||||||||||
Cash and cash equivalents | $ | 7,733 | $ | — | $ | 7,773 | $ | — | ||||||||||||||||
Advertising fund restricted assets – current | — | 39,078 | — | 39,783 | ||||||||||||||||||||
Other current assets | 7,060 | — | 7,155 | — | ||||||||||||||||||||
Property and equipment, net | 19,638 | 65,661 | 20,471 | 70,485 | ||||||||||||||||||||
Other long-term assets | 119 | 960 | 370 | 1,271 | ||||||||||||||||||||
Total assets | $ | 34,550 | $ | 105,699 | $ | 35,769 | $ | 111,539 | ||||||||||||||||
Notes payable to Tim Hortons Inc. – current(2)(3) | $ | 12,996 | $ | 23,040 | $ | 13,689 | $ | 3,040 | ||||||||||||||||
Advertising fund liabilities – current | — | 38,782 | — | 59,913 | ||||||||||||||||||||
Other current liabilities(4) | 11,313 | 5,268 | 11,706 | 5,253 | ||||||||||||||||||||
Notes payable to Tim Hortons Inc. – long-term(2)(3) | 543 | 13,680 | 628 | 15,200 | ||||||||||||||||||||
Long-term debt(4) | — | 22,641 | — | 25,157 | ||||||||||||||||||||
Other long-term liabilities | 8,090 | 2,288 | 9,381 | 2,976 | ||||||||||||||||||||
Total liabilities | 32,942 | 105,699 | 35,404 | 111,539 | ||||||||||||||||||||
Equity of VIEs | 1,608 | — | 365 | — | ||||||||||||||||||||
Total liabilities and equity | $ | 34,550 | $ | 105,699 | $ | 35,769 | $ | 111,539 | ||||||||||||||||
______________ | ||||||||||||||||||||||||
(1) | The Company consolidated 328 Non-owned restaurants as at June 29, 2014 (December 29, 2013: 331). | |||||||||||||||||||||||
(2) | Various assets and liabilities are eliminated upon the consolidation of the Restaurant VIEs, the most significant of which are the FIP Notes payable to the Company, which reduces the Notes receivable, net reported on the Condensed Consolidated Balance Sheet (see note 4). | |||||||||||||||||||||||
(3) | The Notes payable to the Company by the Advertising Fund VIEs, which are funded by the Restricted cash and cash equivalents related to our Tim Card program, are eliminated upon consolidation of the Ad Fund. The Ad Fund drew $20.0 million in the year-to-date period ended June 29, 2014 (year-to-date period ended June 30, 2013: $nil) for purposes of the Expanded Menu Board Program. | |||||||||||||||||||||||
(4) | Includes $27.7 million of Advertising fund VIEs debt with a Canadian financial institution relating to the Expanded Menu Board Program (December 29, 2013: $30.2 million), of which $5.0 million is recognized in Other current liabilities (December 29, 2013: $5.0 million) with the remainder recognized as Long-term debt. | |||||||||||||||||||||||
The liabilities recognized as a result of consolidating these VIEs do not necessarily represent additional claims on the Company’s general assets; rather, they represent claims against the specific assets of the consolidated VIEs. Conversely, assets recognized as a result of consolidating these VIEs do not represent additional assets that could be used to satisfy claims by the Company’s creditors as they are not legally included within the Company’s general assets. |
Segment_Reporting
Segment Reporting | 6 Months Ended | |||||||||||||||
Jun. 29, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Segment Reporting | ' | |||||||||||||||
SEGMENT REPORTING | ||||||||||||||||
The Company operates exclusively in the quick service restaurant industry. The chief decision maker views and evaluates the Company’s reportable segments as follows: | ||||||||||||||||
Canadian and U.S. business units.The results of each of the Canadian and U.S. business units includes substantially all restaurant-facing activities, such as: (i) rents and royalties; (ii) product sales through our supply chain, as well as an allocation of supply chain income, driven primarily by the business units’ respective systemwide sales; (iii) franchise fees; (iv) corporate restaurants; (v) equity income related to restaurant operating ventures; and (vi) business-unit-related general and administrative expenses. The business units exclude the effect of consolidating VIEs, consistent with how the chief decision maker views and evaluates the respective business unit’s results. | ||||||||||||||||
Corporate services. Corporate services comprises services to support the Canadian and U.S. business units, including: (i) general and administrative expenses; (ii) manufacturing income, and to a much lesser extent, manufacturing sales to third parties; and (iii) income related to our distribution services, including the timing of variances arising primarily from commodity costs and the related effect on pricing, which generally reverse within a year, associated with our supply chain management. Our supply chain management involves securing a stable source of supply, which is intended to provide our restaurant owners with consistent and predictable pricing. Many of these products are typically priced based on a fixed-dollar mark-up and can relate to a pricing period which may extend beyond a quarter. Corporate services also includes the results of our international operations, which are currently not significant. | ||||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
Revenues(1) | ||||||||||||||||
Canada | $ | 721,599 | $ | 657,682 | $ | 1,344,784 | $ | 1,251,355 | ||||||||
U.S. | 51,878 | 41,220 | 103,053 | 85,668 | ||||||||||||
Corporate services | 3,636 | 5,204 | 9,305 | 9,329 | ||||||||||||
Total reportable segments | 777,113 | 704,106 | 1,457,142 | 1,346,352 | ||||||||||||
VIEs | 97,234 | 96,033 | 183,607 | 185,324 | ||||||||||||
Total | $ | 874,347 | $ | 800,139 | $ | 1,640,749 | $ | 1,531,676 | ||||||||
Operating Income (Loss) | ||||||||||||||||
Canada | $ | 188,866 | $ | 174,760 | $ | 342,332 | $ | 320,581 | ||||||||
U.S. | 9,254 | 2,587 | 13,611 | 3,497 | ||||||||||||
Corporate services | (8,041 | ) | (1,424 | ) | (22,575 | ) | (12,089 | ) | ||||||||
Total reportable segments | 190,079 | 175,923 | 333,368 | 311,989 | ||||||||||||
VIEs | 2,288 | 1,260 | 4,286 | 2,586 | ||||||||||||
Corporate reorganization expenses | — | (604 | ) | — | (10,079 | ) | ||||||||||
Consolidated Operating Income | 192,367 | 176,579 | 337,654 | 304,496 | ||||||||||||
Interest, Net | (17,510 | ) | (8,131 | ) | (33,209 | ) | (15,866 | ) | ||||||||
Income before income taxes | $ | 174,857 | $ | 168,448 | $ | 304,445 | $ | 288,630 | ||||||||
________________ | ||||||||||||||||
(1) | There are no inter-segment revenues included in the above table. | |||||||||||||||
Consolidated Sales comprise the following: | ||||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
Sales | ||||||||||||||||
Distribution sales | $ | 511,762 | $ | 468,597 | $ | 964,115 | $ | 899,748 | ||||||||
Company-operated restaurant sales | 7,739 | 6,501 | 13,035 | 12,477 | ||||||||||||
Sales from VIEs | 94,328 | 93,464 | 177,709 | 180,224 | ||||||||||||
Total Sales | $ | 613,829 | $ | 568,562 | $ | 1,154,859 | $ | 1,092,449 | ||||||||
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 29, 2014 | |
Accounting Changes and Error Corrections [Abstract] | ' |
Recent Accounting Pronouncements | ' |
RECENT ACCOUNTING PRONOUNCEMENTS | |
In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 Revenue from Contracts with Customers. The amendments in this ASU are intended to provide a more robust framework for addressing revenue issues; improve comparability of revenue recognition practices across entities, industries, jurisdictions and markets; and provide more useful information to financial statement users through improved disclosure requirements. The amendments in this ASU are effective for fiscal years and interim periods beginning on or after December 15, 2016, and should be applied retrospectively using one of two acceptable application methods as noted in the ASU. The Company is currently assessing the potential impact that the adoption and transition to this ASU may have on its Consolidated Financial Statements and related disclosures. |
Basis_of_Presentation_Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 29, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation and Principles of Consolidation | ' |
The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of management, the accompanying Condensed Consolidated Financial Statements contain all adjustments (all of which are normal and recurring in nature) necessary to state fairly the Company’s financial position as at June 29, 2014, and the results of operations, comprehensive income and cash flows for the second quarters ended June 29, 2014 and June 30, 2013. These Condensed Consolidated Financial Statements should be read in conjunction with the audited 2013 Consolidated Financial Statements which are contained in our most recent Annual Report. The December 29, 2013 Condensed Consolidated Balance Sheet included herein was derived from the audited 2013 Consolidated Financial Statements, but does not include all of the year-end disclosures required by U.S. GAAP. | |
Stock-based compensation - performance stock units | ' |
In May 2014, the Company granted performance stock units ("PSUs") to certain of its employees. PSU payout levels will be based on two forward looking performance measures: return on assets and total shareholder return. PSUs are expensed on a straight-line basis over the relevant vesting period. |
Earnings_Per_Common_Share_Attr1
Earnings Per Common Share Attributable to Tim Hortons Inc. (Tables) | 6 Months Ended | |||||||||||||||
Jun. 29, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Computations of Basic and Diluted Earnings Per Common Share | ' | |||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
Net income attributable to Tim Hortons Inc. | $ | 123,750 | $ | 123,736 | $ | 214,659 | $ | 209,907 | ||||||||
Weighted average shares outstanding for computation of basic earnings per common share attributable to Tim Hortons Inc. (in thousands) | 133,899 | 152,083 | 136,007 | 152,597 | ||||||||||||
Dilutive impact of restricted stock units (“RSUs”) and PSUs (in thousands) | 260 | 295 | 252 | 286 | ||||||||||||
Dilutive impact of stock options with tandem stock appreciation rights (“SARs”) (in thousands) | 208 | 259 | 218 | 250 | ||||||||||||
Weighted average shares outstanding for computation of diluted earnings per common share attributable to Tim Hortons Inc. (in thousands) | 134,367 | 152,637 | 136,477 | 153,133 | ||||||||||||
Basic earnings per common share attributable to Tim Hortons Inc. | $ | 0.92 | $ | 0.81 | $ | 1.58 | $ | 1.38 | ||||||||
Diluted earnings per common share attributable to Tim Hortons Inc. | $ | 0.92 | $ | 0.81 | $ | 1.57 | $ | 1.37 | ||||||||
Notes_Receivable_Net_Tables
Notes Receivable, Net (Tables) | 6 Months Ended | |||||||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||||||
Receivables [Abstract] | ' | |||||||||||||||||||||||
Notes Receivable by Segment | ' | |||||||||||||||||||||||
As at | ||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||
Gross | VIEs(2) | Total | Gross | VIEs(2) | Total | |||||||||||||||||||
Franchise Incentive Program (“FIP”) notes(1) | $ | 15,702 | $ | (12,824 | ) | $ | 2,878 | $ | 16,677 | $ | (13,668 | ) | $ | 3,009 | ||||||||||
Other notes receivable(3) | 7,465 | (715 | ) | 6,750 | 8,256 | (649 | ) | 7,607 | ||||||||||||||||
Notes receivable | $ | 23,167 | $ | (13,539 | ) | 9,628 | $ | 24,933 | $ | (14,317 | ) | 10,616 | ||||||||||||
Allowance | (1,411 | ) | (1,502 | ) | ||||||||||||||||||||
Notes receivable, net | $ | 8,217 | $ | 9,114 | ||||||||||||||||||||
Current portion, net | $ | 7,619 | $ | 4,631 | ||||||||||||||||||||
Long-term portion, net | $ | 598 | $ | 4,483 | ||||||||||||||||||||
Notes Receivable by Class and Aging | ' | |||||||||||||||||||||||
As at | ||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||
Class and Aging | Gross | VIEs(2) | Total | Gross | VIEs(2) | Total | ||||||||||||||||||
Current status (FIP notes and other) | $ | 8,222 | $ | (1,353 | ) | $ | 6,869 | $ | 9,688 | $ | (2,081 | ) | $ | 7,607 | ||||||||||
Past-due status < 90 days (FIP notes) | 329 | (329 | ) | — | 328 | — | 328 | |||||||||||||||||
Past-due status > 90 days (FIP notes) | 14,616 | (11,857 | ) | 2,759 | 14,917 | (12,236 | ) | 2,681 | ||||||||||||||||
Notes receivable | $ | 23,167 | $ | (13,539 | ) | $ | 9,628 | $ | 24,933 | $ | (14,317 | ) | $ | 10,616 | ||||||||||
Allowance | (1,411 | ) | (1,502 | ) | ||||||||||||||||||||
Notes receivable, net | $ | 8,217 | $ | 9,114 | ||||||||||||||||||||
________________ | ||||||||||||||||||||||||
(1) | The Company has outstanding FIP arrangements with certain U.S. restaurant owners, which generally provided interest-free financing for the purchase of certain restaurant equipment, furniture, trade fixtures and signage. | |||||||||||||||||||||||
(2) | The notes payable to the Company by VIEs are eliminated on consolidation, which reduces the Notes receivable, net recognized on the Condensed Consolidated Balance Sheet (see note 12). | |||||||||||||||||||||||
(3) | Relates primarily to notes issued to vendors in conjunction with the financing of property sales, and on various equipment and other financing programs. |
Inventories_and_Other_Net_Tabl
Inventories and Other, Net (Tables) | 6 Months Ended | |||||||
Jun. 29, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories and Other, Net | ' | |||||||
As at | ||||||||
June 29, 2014 | December 29, 2013 | |||||||
Raw materials | $ | 25,061 | $ | 22,789 | ||||
Finished goods | 78,332 | 69,348 | ||||||
103,393 | 92,137 | |||||||
Inventory obsolescence provision | (1,418 | ) | (1,754 | ) | ||||
Inventories, net | 101,975 | 90,383 | ||||||
Prepaids and other | 15,801 | 13,943 | ||||||
Total Inventories and other, net | $ | 117,776 | $ | 104,326 | ||||
Accounts_Payable_and_Accrued_L
Accounts Payable and Accrued Liabilities (Tables) | 6 Months Ended | |||||||
Jun. 29, 2014 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Accounts Payable | ' | |||||||
Accounts payable | ||||||||
As at | ||||||||
June 29, 2014 | December 29, 2013 | |||||||
Accounts payable | $ | 137,112 | $ | 142,131 | ||||
Construction holdbacks and accruals | 33,065 | 57,527 | ||||||
Corporate reorganization accrual | 941 | 4,856 | ||||||
Total Accounts payable | $ | 171,118 | $ | 204,514 | ||||
Schedule of Accrued Liabilities | ' | |||||||
Accrued liabilities | ||||||||
As at | ||||||||
June 29, 2014 | 29-Dec-13 | |||||||
Salaries and wages | $ | 14,276 | $ | 22,553 | ||||
Taxes payable | 5,316 | 14,542 | ||||||
De-branding accruals(1) | 1,947 | 9,538 | ||||||
Other accrued liabilities(2) | 44,296 | 42,932 | ||||||
Total Accrued liabilities | $ | 65,835 | $ | 89,565 | ||||
________________ | ||||||||
(1) | Accruals related to Cold Stone Creamery® de-branding activity in Tim Hortons locations in Canada. | |||||||
(2) | Includes accruals for contingent rent, current portion of the Maidstone Bakeries supply contract, deferred revenues, deposits, the current portion of deferred income taxes, and various equipment and other accruals. |
Fair_Values_Tables
Fair Values (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||
Fair Value of Derivative Instruments on Condensed Consolidated Balance Sheet | ' | |||||||||||||||||||
Financial assets and liabilities measured at fair value | ||||||||||||||||||||
As at | ||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||
Fair value | Fair value | Fair value | Fair value | |||||||||||||||||
hierarchy | asset (liability)(1) | hierarchy | asset (liability)(1) | |||||||||||||||||
Derivatives | ||||||||||||||||||||
Forward currency contracts(2) | Level 2 | $ | (2,030 | ) | Level 2 | $ | 4,181 | |||||||||||||
Interest rate swap(3) | Level 2 | (204 | ) | Level 2 | (49 | ) | ||||||||||||||
Interest rate forwards(4) | n/a | — | Level 2 | 285 | ||||||||||||||||
Total return swaps (“TRS”)(5) | Level 2 | 17,147 | Level 2 | 21,393 | ||||||||||||||||
Total Derivatives | $ | 14,913 | $ | 25,810 | ||||||||||||||||
________________ | ||||||||||||||||||||
(1) | The Company values its derivatives using valuations that are calibrated to the initial trade prices. Subsequent valuations are based on observable inputs to the valuation model. | |||||||||||||||||||
(2) | The fair value of forward currency contracts is determined using prevailing exchange rates. | |||||||||||||||||||
(3) | The fair value is estimated using discounted cash flows and market-based observable inputs, including interest rate yield curves and discount rates. | |||||||||||||||||||
(4) | The interest rate forwards were settled as part of the issuance of the Series 3 Notes (see note 7). | |||||||||||||||||||
(5) | The fair value of the TRS is determined using the Company’s common share closing price on the last business day of the fiscal period, as quoted on the Toronto Stock Exchange. | |||||||||||||||||||
Fair Value and Carrying Value of Other Financial Assets and Liabilities | ' | |||||||||||||||||||
The following table summarizes the fair value and carrying value of other financial assets and liabilities that are not recognized at fair value on a recurring basis on the Condensed Consolidated Balance Sheet: | ||||||||||||||||||||
As at | ||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||
Fair value | Fair value | Carrying | Fair value | Fair value | Carrying | |||||||||||||||
hierarchy | asset (liability) | value | hierarchy | asset (liability) | value | |||||||||||||||
Bearer deposit notes(1) | Level 2 | $ | 42,520 | $ | 42,520 | Level 2 | $ | 41,403 | $ | 41,403 | ||||||||||
Notes receivable, net(2) | Level 3 | $ | 8,217 | $ | 8,217 | Level 3 | $ | 9,114 | $ | 9,114 | ||||||||||
Series 1 Notes(3) | Level 2 | $ | (317,877 | ) | $ | (301,022 | ) | Level 2 | $ | (315,519 | ) | $ | (301,196 | ) | ||||||
Series 2 Notes(3) | Level 2 | $ | (474,687 | ) | $ | (449,898 | ) | Level 2 | $ | (445,419 | ) | $ | (449,892 | ) | ||||||
Series 3 Notes(3) | Level 2 | $ | (453,614 | ) | $ | (449,880 | ) | n/a | $ | — | $ | — | ||||||||
Advertising fund term debt(4) | Level 3 | $ | (27,673 | ) | $ | (27,673 | ) | Level 3 | $ | (30,189 | ) | $ | (30,189 | ) | ||||||
Other debt(5) | Level 3 | $ | (138,650 | ) | $ | (72,664 | ) | Level 3 | $ | (126,548 | ) | $ | (69,794 | ) | ||||||
________________ | ||||||||||||||||||||
(1) | The Company holds these notes as collateral to reduce the carrying costs of the TRS. The interest rate on these notes resets every 90 days; therefore, the fair value of these notes, using a market approach, approximates the carrying value. | |||||||||||||||||||
(2) | Management generally estimates the current value of notes receivable, using a cost approach, based primarily on the estimated depreciated replacement cost of the underlying equipment held as collateral. | |||||||||||||||||||
(3) | The fair value of the senior unsecured notes, using a market approach, is based on publicly disclosed trades between arm’s length institutions as documented on Bloomberg L.P. | |||||||||||||||||||
(4) | Management estimates the fair value of this variable rate debt using a market approach, based on prevailing interest rates plus an applicable margin. | |||||||||||||||||||
(5) | Management estimates the fair value of its Other debt, primarily consisting of contributions received related to the construction costs of certain restaurants, using an income approach, by discounting future cash flows using a Company risk-adjusted rate over the remaining term of the debt. |
Derivatives_Tables
Derivatives (Tables) | 6 Months Ended | |||||||||||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||||||||||||||||
Summary of Fair Value of Derivative Instruments on Consolidated Balance Sheet | ' | |||||||||||||||||||||||||||
As at | ||||||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||||||
Asset | Liability | Net | Classification on | Asset | Liability | Net | Classification on | |||||||||||||||||||||
asset | Condensed | asset | Condensed | |||||||||||||||||||||||||
(liability) | Consolidated | (liability) | Consolidated | |||||||||||||||||||||||||
Balance Sheet | Balance Sheet | |||||||||||||||||||||||||||
Derivatives designated as cash flow hedging instruments | ||||||||||||||||||||||||||||
Forward currency contracts(1) | $ | 919 | $ | (2,142 | ) | $ | (1,223 | ) | Accounts payable, net | $ | 4,181 | $ | — | $ | 4,181 | Accounts receivable, net | ||||||||||||
Interest rate swap(2) | $ | — | $ | (204 | ) | $ | (204 | ) | Other long-term liabilities | $ | — | $ | (49 | ) | $ | (49 | ) | Other long-term liabilities | ||||||||||
Interest rate forwards(3) | $ | — | $ | — | $ | — | n/a | $ | 285 | $ | — | $ | 285 | Accounts receivable, net | ||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||||||||||||||
TRS(4) | $ | 17,160 | $ | (13 | ) | $ | 17,147 | Other assets | $ | 21,393 | $ | — | $ | 21,393 | Other assets | |||||||||||||
Forward currency contracts(1) | $ | 15 | $ | (822 | ) | $ | (807 | ) | Accounts payable, net | $ | — | $ | — | $ | — | n/a | ||||||||||||
________________ | ||||||||||||||||||||||||||||
(1) | Notional value as at June 29, 2014 of $167.8 million (December 29, 2013: $154.0 million), with maturities ranging between June 2014 and April 2015; no associated cash collateral. | |||||||||||||||||||||||||||
(2) | Notional value as at June 29, 2014 of $27.5 million (December 29, 2013: $30.0 million), with maturities through fiscal 2019; no associated cash collateral. | |||||||||||||||||||||||||||
(3) | The interest rate forwards were settled in the first quarter of 2014 (notional amount at December 29, 2013: $90.0 million). | |||||||||||||||||||||||||||
(4) | The notional value and associated cash collateral, in the form of bearer deposit notes (see note 8), was $42.5 million as at June 29, 2014 (December 29, 2013: $41.4 million). The TRS have maturities annually, in May, between fiscal 2015 and fiscal 2021. | |||||||||||||||||||||||||||
Summary of Effect of Derivative Instruments on Consolidated Statement of Comprehensive Income | ' | |||||||||||||||||||||||||||
Second quarter ended June 29, 2014 | Second quarter ended June 30, 2013 | |||||||||||||||||||||||||||
Derivatives designated as cash flow | Classification on | Amount of | Amount of net | Total effect | Amount of | Amount of net | Total effect | |||||||||||||||||||||
hedging instruments(1) | Condensed | gain (loss) | (gain) loss | on OCI(2) | gain (loss) | (gain) loss | on OCI(2) | |||||||||||||||||||||
Consolidated | recognized | reclassified | recognized | reclassified | ||||||||||||||||||||||||
Statement of | in OCI(2) | to earnings | in OCI(2) | to earnings | ||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||
Forward currency contracts | Cost of sales | $ | (4,921 | ) | $ | (1,716 | ) | $ | (6,637 | ) | $ | 4,851 | $ | 144 | $ | 4,995 | ||||||||||||
Interest rate swap(3) | Interest (expense) | (47 | ) | 50 | 3 | 456 | 61 | 517 | ||||||||||||||||||||
Interest rate forwards(4) | Interest (expense) | — | 667 | 667 | — | 173 | 173 | |||||||||||||||||||||
Total | (4,968 | ) | (999 | ) | (5,967 | ) | 5,307 | 378 | 5,685 | |||||||||||||||||||
Income tax effect | Income taxes | 1,321 | 442 | 1,763 | (1,279 | ) | (54 | ) | (1,333 | ) | ||||||||||||||||||
Net of income taxes | $ | (3,647 | ) | $ | (557 | ) | $ | (4,204 | ) | $ | 4,028 | $ | 324 | $ | 4,352 | |||||||||||||
Year-to-date period ended June 29, 2014 | Year-to-date period ended June 30, 2013 | |||||||||||||||||||||||||||
Derivatives designated as cash flow | Classification on | Amount of | Amount of net | Total effect | Amount of | Amount of net | Total effect | |||||||||||||||||||||
hedging instruments(1) | Condensed | gain (loss) | (gain) loss | on OCI(2) | gain (loss) | (gain) loss | on OCI(2) | |||||||||||||||||||||
Consolidated | recognized | reclassified | recognized | reclassified | ||||||||||||||||||||||||
Statement of | in OCI(2) | to earnings | in OCI(2) | to earnings | ||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||
Forward currency contracts | Cost of sales | $ | (516 | ) | $ | (4,888 | ) | $ | (5,404 | ) | $ | 8,124 | $ | 615 | $ | 8,739 | ||||||||||||
Interest rate swap(3) | Interest (expense) | (258 | ) | 103 | (155 | ) | (45 | ) | 80 | 35 | ||||||||||||||||||
Interest rate forwards(4) | Interest (expense) | (5,136 | ) | 1,085 | (4,051 | ) | — | 346 | 346 | |||||||||||||||||||
Total | (5,910 | ) | (3,700 | ) | (9,610 | ) | 8,079 | 1,041 | 9,120 | |||||||||||||||||||
Income tax effect | Income taxes | 205 | 1,271 | 1,476 | (2,141 | ) | (184 | ) | (2,325 | ) | ||||||||||||||||||
Net of income taxes | $ | (5,705 | ) | $ | (2,429 | ) | $ | (8,134 | ) | $ | 5,938 | $ | 857 | $ | 6,795 | |||||||||||||
_______________ | ||||||||||||||||||||||||||||
(1) | Excludes amounts related to ineffectiveness, as they were not significant. | |||||||||||||||||||||||||||
(2) | Other comprehensive income (“OCI”). | |||||||||||||||||||||||||||
(3) | The Ad Fund entered into an amortizing interest rate swap to fix a portion of the interest expense on its term debt. | |||||||||||||||||||||||||||
(4) | The Company entered into and settled interest rate forwards relating to the issuance of its long-term deb | |||||||||||||||||||||||||||
Summary of (Gain) loss on Derivatives Not Designated as Hedging Instruments [Table Text Block] | ' | |||||||||||||||||||||||||||
Derivatives not designated as cash flow hedging instruments | Classification on Condensed Consolidated | Second quarter ended | Year-to-date period ended | |||||||||||||||||||||||||
Statement of Operations | 29-Jun-14 | 30-Jun-13 | 29-Jun-14 | 30-Jun-13 | ||||||||||||||||||||||||
TRS | General and administrative expenses | $ | 1,998 | $ | (1,482 | ) | $ | 4,246 | $ | (8,235 | ) | |||||||||||||||||
Forward currency contracts | Cost of sales | 167 | (69 | ) | 167 | (349 | ) | |||||||||||||||||||||
Forward currency contracts | Other (income) expense | 640 | — | 640 | — | |||||||||||||||||||||||
Total loss (gain), net | $ | 2,805 | $ | (1,551 | ) | $ | 5,053 | $ | (8,584 | ) | ||||||||||||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 6 Months Ended | |||||||||||||||
Jun. 29, 2014 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||
Stock Based Compensation Expenses Included in General and Administrative Expenses | ' | |||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
RSUs and PSUs | $ | 1,386 | $ | 2,478 | $ | 2,656 | $ | 3,580 | ||||||||
Stock options and tandem SARs | (362 | ) | 2,264 | (1,864 | ) | 7,339 | ||||||||||
Deferred share units (“DSUs”) | 108 | 406 | 94 | 1,616 | ||||||||||||
Total stock-based compensation expense | $ | 1,132 | $ | 5,148 | $ | 886 | $ | 12,535 | ||||||||
TRS loss (gain)(1) | $ | 1,998 | $ | (1,482 | ) | $ | 4,246 | $ | (8,235 | ) | ||||||
________________ | ||||||||||||||||
(1) | The Company has entered into TRS contracts as economic hedges, covering 1,027,000 of the Company’s underlying common shares (June 30, 2013: 1,008,000), which represents a portion of its outstanding stock options with tandem SARs, and substantially all of its cash obligation related to DSUs. See note 9 for the revaluation of the TRS contracts. |
Variable_Interest_Entities_Tab
Variable Interest Entities (Tables) | 6 Months Ended | |||||||||||||||||||||||
Jun. 29, 2014 | ||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||||||||||||||
Schedule of Revenues and Expenses of Variable Interest Entities | ' | |||||||||||||||||||||||
The revenues and expenses associated with the Company’s consolidated Non-owned restaurants and advertising funds presented on a gross basis, prior to consolidation adjustments, are as follows: | ||||||||||||||||||||||||
Second quarter ended | ||||||||||||||||||||||||
June 29, 2014 | June 30, 2013 | |||||||||||||||||||||||
Restaurant | Advertising | Total | Restaurant | Advertising | Total | |||||||||||||||||||
VIEs(1) | fund VIEs(2) | VIEs | VIEs(1) | fund VIEs(2) | VIEs | |||||||||||||||||||
Sales | $ | 94,328 | $ | — | $ | 94,328 | $ | 93,464 | $ | — | $ | 93,464 | ||||||||||||
Advertising levies | — | 2,906 | 2,906 | — | 2,569 | 2,569 | ||||||||||||||||||
Total revenues | 94,328 | 2,906 | 97,234 | 93,464 | 2,569 | 96,033 | ||||||||||||||||||
Cost of sales | 92,242 | — | 92,242 | 92,480 | — | 92,480 | ||||||||||||||||||
Operating expenses | — | 2,704 | 2,704 | — | 2,293 | 2,293 | ||||||||||||||||||
Operating income | 2,086 | 202 | 2,288 | 984 | 276 | 1,260 | ||||||||||||||||||
Interest expense | 33 | 202 | 235 | — | 276 | 276 | ||||||||||||||||||
Income before taxes | 2,053 | — | 2,053 | 984 | — | 984 | ||||||||||||||||||
Income taxes | 371 | — | 371 | 158 | — | 158 | ||||||||||||||||||
Net income attributable to noncontrolling interests | $ | 1,682 | $ | — | $ | 1,682 | $ | 826 | $ | — | $ | 826 | ||||||||||||
Year-to-date period ended | ||||||||||||||||||||||||
29-Jun-14 | 30-Jun-13 | |||||||||||||||||||||||
Restaurant | Advertising | Total | Restaurant | Advertising | Total | |||||||||||||||||||
VIEs(1) | fund VIEs(2) | VIEs | VIEs(1) | fund VIEs(2) | VIEs | |||||||||||||||||||
Sales | $ | 177,709 | $ | — | $ | 177,709 | $ | 180,224 | $ | — | $ | 180,224 | ||||||||||||
Advertising levies | — | 5,898 | 5,898 | — | 5,100 | 5,100 | ||||||||||||||||||
Total revenues | 177,709 | 5,898 | 183,607 | 180,224 | 5,100 | 185,324 | ||||||||||||||||||
Cost of sales | 173,855 | — | 173,855 | 178,346 | — | 178,346 | ||||||||||||||||||
Operating expenses | — | 5,466 | 5,466 | — | 4,392 | 4,392 | ||||||||||||||||||
Operating income | 3,854 | 432 | 4,286 | 1,878 | 708 | 2,586 | ||||||||||||||||||
Interest expense | 33 | 432 | 465 | — | 708 | 708 | ||||||||||||||||||
Income before taxes | 3,821 | — | 3,821 | 1,878 | — | 1,878 | ||||||||||||||||||
Income taxes | 693 | — | 693 | 300 | — | 300 | ||||||||||||||||||
Net income attributable to noncontrolling interests | $ | 3,128 | $ | — | $ | 3,128 | $ | 1,578 | $ | — | $ | 1,578 | ||||||||||||
______________ | ||||||||||||||||||||||||
(1) | Includes rents, royalties, advertising expenses and product purchases from the Company which are eliminated upon the consolidation of these VIEs. | |||||||||||||||||||||||
(2) | The advertising levies, depreciation, interest costs, capital expenditures and financing associated with the Ad Fund’s program to acquire and install LCD screens, media engines, drive-thru menu boards and ancillary equipment for our restaurants (the “Expanded Menu Board Program”) are presented on a gross basis. Generally, the advertising levies that are not related to the Expanded Menu Board Program are netted with advertising and marketing expenses incurred by the advertising funds in operating expenses, as these contributions are designated for specific purposes. The Company acts as an agent with regard to these contributions. | |||||||||||||||||||||||
Schedule of Assets and Liabilities of Variable Interest Entities | ' | |||||||||||||||||||||||
The assets and liabilities associated with the Company’s consolidated Non-owned restaurants and advertising funds presented on a gross basis, prior to consolidation adjustments, are as follows: | ||||||||||||||||||||||||
As at | ||||||||||||||||||||||||
June 29, 2014 | December 29, 2013 | |||||||||||||||||||||||
Restaurant | Advertising | Restaurant | Advertising | |||||||||||||||||||||
VIEs(1) | fund VIEs | VIEs(1) | fund VIEs | |||||||||||||||||||||
Cash and cash equivalents | $ | 7,733 | $ | — | $ | 7,773 | $ | — | ||||||||||||||||
Advertising fund restricted assets – current | — | 39,078 | — | 39,783 | ||||||||||||||||||||
Other current assets | 7,060 | — | 7,155 | — | ||||||||||||||||||||
Property and equipment, net | 19,638 | 65,661 | 20,471 | 70,485 | ||||||||||||||||||||
Other long-term assets | 119 | 960 | 370 | 1,271 | ||||||||||||||||||||
Total assets | $ | 34,550 | $ | 105,699 | $ | 35,769 | $ | 111,539 | ||||||||||||||||
Notes payable to Tim Hortons Inc. – current(2)(3) | $ | 12,996 | $ | 23,040 | $ | 13,689 | $ | 3,040 | ||||||||||||||||
Advertising fund liabilities – current | — | 38,782 | — | 59,913 | ||||||||||||||||||||
Other current liabilities(4) | 11,313 | 5,268 | 11,706 | 5,253 | ||||||||||||||||||||
Notes payable to Tim Hortons Inc. – long-term(2)(3) | 543 | 13,680 | 628 | 15,200 | ||||||||||||||||||||
Long-term debt(4) | — | 22,641 | — | 25,157 | ||||||||||||||||||||
Other long-term liabilities | 8,090 | 2,288 | 9,381 | 2,976 | ||||||||||||||||||||
Total liabilities | 32,942 | 105,699 | 35,404 | 111,539 | ||||||||||||||||||||
Equity of VIEs | 1,608 | — | 365 | — | ||||||||||||||||||||
Total liabilities and equity | $ | 34,550 | $ | 105,699 | $ | 35,769 | $ | 111,539 | ||||||||||||||||
______________ | ||||||||||||||||||||||||
(1) | The Company consolidated 328 Non-owned restaurants as at June 29, 2014 (December 29, 2013: 331). | |||||||||||||||||||||||
(2) | Various assets and liabilities are eliminated upon the consolidation of the Restaurant VIEs, the most significant of which are the FIP Notes payable to the Company, which reduces the Notes receivable, net reported on the Condensed Consolidated Balance Sheet (see note 4). | |||||||||||||||||||||||
(3) | The Notes payable to the Company by the Advertising Fund VIEs, which are funded by the Restricted cash and cash equivalents related to our Tim Card program, are eliminated upon consolidation of the Ad Fund. The Ad Fund drew $20.0 million in the year-to-date period ended June 29, 2014 (year-to-date period ended June 30, 2013: $nil) for purposes of the Expanded Menu Board Program. | |||||||||||||||||||||||
(4) | Includes $27.7 million of Advertising fund VIEs debt with a Canadian financial institution relating to the Expanded Menu Board Program (December 29, 2013: $30.2 million), of which $5.0 million is recognized in Other current liabilities (December 29, 2013: $5.0 million) with the remainder recognized as Long-term debt. |
Segment_Reporting_Tables
Segment Reporting (Tables) | 6 Months Ended | |||||||||||||||
Jun. 29, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Information on Reportable Segments | ' | |||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
Revenues(1) | ||||||||||||||||
Canada | $ | 721,599 | $ | 657,682 | $ | 1,344,784 | $ | 1,251,355 | ||||||||
U.S. | 51,878 | 41,220 | 103,053 | 85,668 | ||||||||||||
Corporate services | 3,636 | 5,204 | 9,305 | 9,329 | ||||||||||||
Total reportable segments | 777,113 | 704,106 | 1,457,142 | 1,346,352 | ||||||||||||
VIEs | 97,234 | 96,033 | 183,607 | 185,324 | ||||||||||||
Total | $ | 874,347 | $ | 800,139 | $ | 1,640,749 | $ | 1,531,676 | ||||||||
Operating Income (Loss) | ||||||||||||||||
Canada | $ | 188,866 | $ | 174,760 | $ | 342,332 | $ | 320,581 | ||||||||
U.S. | 9,254 | 2,587 | 13,611 | 3,497 | ||||||||||||
Corporate services | (8,041 | ) | (1,424 | ) | (22,575 | ) | (12,089 | ) | ||||||||
Total reportable segments | 190,079 | 175,923 | 333,368 | 311,989 | ||||||||||||
VIEs | 2,288 | 1,260 | 4,286 | 2,586 | ||||||||||||
Corporate reorganization expenses | — | (604 | ) | — | (10,079 | ) | ||||||||||
Consolidated Operating Income | 192,367 | 176,579 | 337,654 | 304,496 | ||||||||||||
Interest, Net | (17,510 | ) | (8,131 | ) | (33,209 | ) | (15,866 | ) | ||||||||
Income before income taxes | $ | 174,857 | $ | 168,448 | $ | 304,445 | $ | 288,630 | ||||||||
________________ | ||||||||||||||||
(1) | There are no inter-segment revenues included in the above table. | |||||||||||||||
Consolidated Sales Information | ' | |||||||||||||||
Consolidated Sales comprise the following: | ||||||||||||||||
Second quarter ended | Year-to-date period ended | |||||||||||||||
June 29, 2014 | June 30, 2013 | June 29, 2014 | June 30, 2013 | |||||||||||||
Sales | ||||||||||||||||
Distribution sales | $ | 511,762 | $ | 468,597 | $ | 964,115 | $ | 899,748 | ||||||||
Company-operated restaurant sales | 7,739 | 6,501 | 13,035 | 12,477 | ||||||||||||
Sales from VIEs | 94,328 | 93,464 | 177,709 | 180,224 | ||||||||||||
Total Sales | $ | 613,829 | $ | 568,562 | $ | 1,154,859 | $ | 1,092,449 | ||||||||
Basis_of_Presentation_Addition
Basis of Presentation Additional Information (Details) | 3 Months Ended |
Jun. 29, 2014 | |
Additional Information [Abstract] | ' |
Number of Performance Measures for Performance Stock Units | 2 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' |
Effective income tax rate | 28.30% | 26.10% | 28.50% | 26.70% |
Computations_of_Basic_and_Dilu
Computations of Basic and Diluted Earnings Per Common Share (Detail) (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Earnings Per Share [Abstract] | ' | ' | ' | ' |
Net income attributable to Tim Hortons Inc. | 123,750 | 123,736 | 214,659 | 209,907 |
Weighted average shares outstanding for computation of basic earnings per common share attributable to Tim Hortons Inc. (in thousands) | 133,899 | 152,083 | 136,007 | 152,597 |
Dilutive impact of RSUs and PSUs (in thousands) | 260 | 295 | 252 | 286 |
Dilutive Impact of Stock Options with tandem SARs (in thousands) | 208 | 259 | 218 | 250 |
Weighted average shares outstanding for computation of diluted earnings per common share attributable to Tim Hortons Inc. (in thousands) | 134,367 | 152,637 | 136,477 | 153,133 |
Basic earnings per common share attributable to Tim Hortons Inc. (in Canadian dollars per share) | 0.92 | 0.81 | 1.58 | 1.38 |
Diluted earnings per common share attributable to Tim Hortons Inc. (in Canadian dollars per share) | 0.92 | 0.81 | 1.57 | 1.37 |
Notes_Receivable_By_Segment_De
Notes Receivable By Segment (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | 9,628 | 10,616 |
Allowance | -1,411 | -1,502 |
Notes receivable, net | 8,217 | 9,114 |
Current portion, net | 7,619 | 4,631 |
Long-term portion, net | 598 | 4,483 |
Gross | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | 23,167 | 24,933 |
VIEs | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | -13,539 | -14,317 |
Franchise Incentive Program ("FIP") notes | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | 2,878 | 3,009 |
Franchise Incentive Program ("FIP") notes | Gross | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | 15,702 | 16,677 |
Franchise Incentive Program ("FIP") notes | VIEs | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | -12,824 | -13,668 |
Other notes receivable | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | 6,750 | 7,607 |
Other notes receivable | Gross | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | 7,465 | 8,256 |
Other notes receivable | VIEs | ' | ' |
Notes Receivable By Segment [Line Items] | ' | ' |
Notes receivable | -715 | -649 |
Notes_Receivable_By_Class_and_
Notes Receivable By Class and Aging (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 9,628 | 10,616 |
Allowance | -1,411 | -1,502 |
Notes receivable, net | 8,217 | 9,114 |
Current Status (FIPs And Other) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 6,869 | 7,607 |
Past Due Status Less Than 90 Days (FIPs) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 0 | 328 |
Past Due Status Greater Than 90 Days (FIPs) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 2,759 | 2,681 |
Gross | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 23,167 | 24,933 |
Gross | Current Status (FIPs And Other) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 8,222 | 9,688 |
Gross | Past Due Status Less Than 90 Days (FIPs) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 329 | 328 |
Gross | Past Due Status Greater Than 90 Days (FIPs) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | 14,616 | 14,917 |
VIEs | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | -13,539 | -14,317 |
VIEs | Current Status (FIPs And Other) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | -1,353 | -2,081 |
VIEs | Past Due Status Less Than 90 Days (FIPs) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | -329 | 0 |
VIEs | Past Due Status Greater Than 90 Days (FIPs) | ' | ' |
Notes Receivable By Class And Aging [Line Items] | ' | ' |
Notes receivable | -11,857 | -12,236 |
Inventories_and_Other_Net_Deta
Inventories and Other Net (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Raw materials | 25,061 | 22,789 |
Finished goods | 78,332 | 69,348 |
Inventories, gross | 103,393 | 92,137 |
Inventory obsolescence provision | -1,418 | -1,754 |
Inventories, net | 101,975 | 90,383 |
Prepaid Expense and Other Assets | 15,801 | 13,943 |
Total Inventories and other, net | 117,776 | 104,326 |
Accounts_Payable_Detail
Accounts Payable (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Payables and Accruals [Abstract] | ' | ' |
Accounts payable | 137,112 | 142,131 |
Construction holdbacks and accruals | 33,065 | 57,527 |
Corporate reorganization accrual | 941 | 4,856 |
Total Accounts payable | 171,118 | 204,514 |
Accrued_Liabilities_Details
Accrued Liabilities (Details) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Payables and Accruals [Abstract] | ' | ' |
Salaries and wages | 14,276 | 22,553 |
Taxes payable | 5,316 | 14,542 |
De-branding accruals(1) | 1,947 | 9,538 |
Other accrued liabilities(2) | 44,296 | 42,932 |
Total Accrued liabilities | 65,835 | 89,565 |
Long_Term_Debt_Details
Long Term Debt (Details) (CAD) | 3 Months Ended |
Mar. 30, 2014 | |
Series 3 Notes | Senior Notes [Member] | ' |
Debt [Line Items] | ' |
Proceeds from Issuance of Senior Long-term Debt | 449,900,000 |
Debt Instrument, Unamortized Discount | 100,000 |
2013 Facility [Member] | Revolving Credit Facility | ' |
Debt [Line Items] | ' |
Line of Credit Facility, Maximum Borrowing Capacity | 400,000,000 |
Financial_Assets_and_Liabiliti
Financial Assets and Liabilities Measured at Fair Value (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fair value asset (liability) | 14,913 | 25,810 |
Interest Rate Forwards | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fair value asset (liability) | 0 | ' |
Level 2 | Forward Currency Contracts | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fair value asset (liability) | -2,030 | 4,181 |
Level 2 | Interest Rate Swap | Canadian Ad Fund | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fair value asset (liability) | -204 | -49 |
Level 2 | Interest Rate Forwards | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fair value asset (liability) | ' | 285 |
Level 2 | TRS | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fair value asset (liability) | 17,147 | 21,393 |
Financial_Assets_and_Liabiliti1
Financial Assets and Liabilities Not Measured at Fair Value (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Carrying Value | ' | ' |
Bearer deposit notes | 117,452 | 117,552 |
Notes receivable, net | 9,628 | 10,616 |
Series 3 Notes | ' | ' |
Fair Value Asset (Liability) | ' | ' |
Senior Notes Payable | ' | 0 |
Carrying Value | ' | ' |
Senior Notes Payable | ' | 0 |
Level 2 | ' | ' |
Fair Value Asset (Liability) | ' | ' |
Bearer deposit notes | 42,520 | 41,403 |
Carrying Value | ' | ' |
Bearer deposit notes | 42,520 | 41,403 |
Level 2 | Series 1 Notes | ' | ' |
Fair Value Asset (Liability) | ' | ' |
Senior Notes Payable | -317,877 | -315,519 |
Carrying Value | ' | ' |
Senior Notes Payable | -301,022 | -301,196 |
Level 2 | Series 2 Notes | ' | ' |
Fair Value Asset (Liability) | ' | ' |
Senior Notes Payable | -474,687 | -445,419 |
Carrying Value | ' | ' |
Senior Notes Payable | -449,898 | -449,892 |
Level 2 | Series 3 Notes | ' | ' |
Fair Value Asset (Liability) | ' | ' |
Senior Notes Payable | -453,614 | ' |
Carrying Value | ' | ' |
Senior Notes Payable | -449,880 | ' |
Level 3 | ' | ' |
Fair Value Asset (Liability) | ' | ' |
Notes receivable, net | 8,217 | 9,114 |
Advertising fund term debt | -27,673 | -30,189 |
Other debt | -138,650 | -126,548 |
Carrying Value | ' | ' |
Notes receivable, net | 8,217 | 9,114 |
Advertising fund term debt | -27,673 | -30,189 |
Other debt | -72,664 | -69,794 |
Fair_Values_Financial_Assets_a
Fair Values Financial Assets and Liabilities Not Measured At Fair Value (Parenthetical) (Details) | 6 Months Ended |
Jun. 29, 2014 | |
Fair Value Disclosures [Abstract] | ' |
Interest Rate Reset Period (in days) | '90 days |
Summary_Of_Fair_Value_Of_Deriv
Summary Of Fair Value Of Derivative Instruments On Consolidated Balance Sheet (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Derivatives Designated As Cash Flow Hedging Instruments | Forward Currency Contracts | ' | ' |
Cash Flow Hedges Derivative Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value Asset | 919 | 4,181 |
Fair Value Liability | -2,142 | 0 |
Derivatives Designated As Cash Flow Hedging Instruments | Forward Currency Contracts | Accounts Receivable | ' | ' |
Cash Flow Hedges Derivative Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value, Net | ' | 4,181 |
Derivatives Designated As Cash Flow Hedging Instruments | Forward Currency Contracts | Accounts Payable [Member] | ' | ' |
Cash Flow Hedges Derivative Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value, Net | -1,223 | ' |
Derivatives Designated As Cash Flow Hedging Instruments | Interest Rate Forwards | ' | ' |
Cash Flow Hedges Derivative Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value Asset | 0 | 285 |
Fair Value Liability | 0 | 0 |
Fair Value, Net | 0 | ' |
Derivatives Designated As Cash Flow Hedging Instruments | Interest Rate Forwards | Accounts Receivable | ' | ' |
Cash Flow Hedges Derivative Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value, Net | ' | 285 |
Derivatives Designated As Cash Flow Hedging Instruments | Canadian Ad Fund | Interest Rate Swap | ' | ' |
Cash Flow Hedges Derivative Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value Asset | 0 | 0 |
Fair Value Liability | -204 | -49 |
Derivatives Designated As Cash Flow Hedging Instruments | Canadian Ad Fund | Interest Rate Swap | Other Long-term Liabilities | ' | ' |
Cash Flow Hedges Derivative Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value, Net | -204 | -49 |
Derivatives Not Designated As Hedging Instruments | Forward Currency Contracts | ' | ' |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value Assets | 15 | 0 |
Fair Value Liability | -822 | 0 |
Fair Value, Net | ' | 0 |
Derivatives Not Designated As Hedging Instruments | Forward Currency Contracts | Accounts Payable [Member] | ' | ' |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value, Net | -807 | ' |
Derivatives Not Designated As Hedging Instruments | TRS | ' | ' |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value Assets | 17,160 | 21,393 |
Fair Value Liability | -13 | 0 |
Derivatives Not Designated As Hedging Instruments | TRS | Other Assets | ' | ' |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net [Abstract] | ' | ' |
Fair Value, Net | 17,147 | 21,393 |
Summary_Of_Fair_Value_Of_Deriv1
Summary Of Fair Value Of Derivative Instruments On Consolidated Balance Sheet (Parenthetical) (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
In Millions, unless otherwise specified | ||
Forward Currency Contracts | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative, Notional Amount | 167.8 | 154 |
Interest Rate Forwards | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative, Notional Amount | ' | 90 |
TRS | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative, Notional Amount | 42.5 | 41.4 |
Canadian Ad Fund | Interest Rate Swap | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative, Notional Amount | 27.5 | 30 |
Summary_Of_Effect_Of_Derivativ
Summary Of Effect Of Derivative Instruments On Consolidated Statement Of Comprehensive Income (Detail) (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of net (gain) loss reclassified to earnings | -999 | 378 | -3,700 | 1,041 |
Cash Flow Hedging | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of gain (loss) recognized in OCI | -4,968 | 5,307 | -5,910 | 8,079 |
Amount of gain (loss) recognized in OCI, Income tax effect | 1,321 | -1,279 | 205 | -2,141 |
Amount of gain (loss) recognized in OCI, Net of income taxes | -3,647 | 4,028 | -5,705 | 5,938 |
Amount of net (gain) loss reclassified to earnings | -999 | 378 | -3,700 | 1,041 |
Amount of net (gain) loss reclassified to earnings, Net of income taxes | -557 | 324 | -2,429 | 857 |
Total effect on OCI | -5,967 | 5,685 | -9,610 | 9,120 |
Total effect on OCI, Income tax effect | 1,763 | -1,333 | 1,476 | -2,325 |
Total effect on OCI, Net of income taxes | -4,204 | 4,352 | -8,134 | 6,795 |
Cash Flow Hedging | Income Taxes [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of net (gain) loss reclassified to earnings, Income tax effect | 442 | -54 | 1,271 | -184 |
Cash Flow Hedging | Forward Currency Contracts | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of gain (loss) recognized in OCI | -4,921 | 4,851 | -516 | 8,124 |
Total effect on OCI | -6,637 | 4,995 | -5,404 | 8,739 |
Cash Flow Hedging | Forward Currency Contracts | Cost Of Sales | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of net (gain) loss reclassified to earnings | -1,716 | 144 | -4,888 | 615 |
Cash Flow Hedging | Interest Rate Swap | Canadian Ad Fund | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of gain (loss) recognized in OCI | -47 | 456 | -258 | -45 |
Total effect on OCI | 3 | 517 | -155 | 35 |
Cash Flow Hedging | Interest Rate Swap | Interest (Expense) | Canadian Ad Fund | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of net (gain) loss reclassified to earnings | 50 | 61 | 103 | 80 |
Cash Flow Hedging | Interest Rate Forwards | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of gain (loss) recognized in OCI | 0 | 0 | -5,136 | 0 |
Total effect on OCI | 667 | 173 | -4,051 | 346 |
Cash Flow Hedging | Interest Rate Forwards | Interest (Expense) | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of net (gain) loss reclassified to earnings | 667 | 173 | 1,085 | 346 |
Derivatives_Summary_of_Gain_Lo
Derivatives Summary of (Gain) Loss on Derivatives Not Designated as Hedging Instruments (Details) (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Summary of (Gain) loss on Derivatives Not Designated as Hedging Instruments [Line Items] | ' | ' | ' | ' |
Loss (gain), net | 2,805 | -1,551 | 5,053 | -8,584 |
General and Administrative Expense | TRS | ' | ' | ' | ' |
Summary of (Gain) loss on Derivatives Not Designated as Hedging Instruments [Line Items] | ' | ' | ' | ' |
Loss (gain), net | 1,998 | -1,482 | 4,246 | -8,235 |
Cost Of Sales | Forward Currency Contracts | ' | ' | ' | ' |
Summary of (Gain) loss on Derivatives Not Designated as Hedging Instruments [Line Items] | ' | ' | ' | ' |
Loss (gain), net | 167 | -69 | 167 | -349 |
Other Operating Income (Expense) [Member] | Forward Currency Contracts | ' | ' | ' | ' |
Summary of (Gain) loss on Derivatives Not Designated as Hedging Instruments [Line Items] | ' | ' | ' | ' |
Loss (gain), net | 640 | 0 | 640 | 0 |
StockBased_Compensation_Expens
Stock-Based Compensation Expense Included In General And Administrative Expenses (Detail) (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
RSUs and PSUs | 1,386 | 2,478 | 2,656 | 3,580 |
Stock options and tandem SARs | -362 | 2,264 | -1,864 | 7,339 |
DSUs | 108 | 406 | 94 | 1,616 |
Total stock-based compensation expense | 1,132 | 5,148 | 886 | 12,535 |
TRS loss (gain) | 2,805 | -1,551 | 5,053 | -8,584 |
General and Administrative Expense | TRS | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
TRS loss (gain) | 1,998 | -1,482 | 4,246 | -8,235 |
StockBased_Compensation_Additi
Stock-Based Compensation Additional Information (Detail) (CAD) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Underlying Common Stock Covered Under Total Return Swap Contracts | 1,027 | 1,008 |
Restricted Stock Units (RSUs) [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 62 | 80 |
Performance Shares [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 72 | 61 |
Restricted Stock Units (RSUs) and Performance Stock Units (PSUs) [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | 60.09 | 56.12 |
Stock Options And Tandem Stock Appreciation Rights [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 578 | 241 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | 60.09 | 56.12 |
Revenues_and_Expenses_of_Varia
Revenues and Expenses of Variable Interest Entities (Detail) (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Sales | 613,829 | 568,562 | 1,154,859 | 1,092,449 |
Total revenues | 874,347 | 800,139 | 1,640,749 | 1,531,676 |
Cost of sales | 527,132 | 489,092 | 1,000,715 | 950,446 |
Operating expenses | 84,411 | 76,986 | 165,669 | 152,719 |
Operating income | 192,367 | 176,579 | 337,654 | 304,496 |
Interest expense | 18,648 | 8,922 | 35,324 | 17,585 |
Income before income taxes | 174,857 | 168,448 | 304,445 | 288,630 |
Income taxes | 49,425 | 43,886 | 86,658 | 77,145 |
Net income attributable to noncontrolling interests | 1,682 | 826 | 3,128 | 1,578 |
Restaurant VIEs | ' | ' | ' | ' |
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Sales | 94,328 | 93,464 | 177,709 | 180,224 |
Advertising levies | 0 | 0 | 0 | 0 |
Total revenues | 94,328 | 93,464 | 177,709 | 180,224 |
Cost of sales | 92,242 | 92,480 | 173,855 | 178,346 |
Operating expenses | 0 | 0 | 0 | 0 |
Operating income | 2,086 | 984 | 3,854 | 1,878 |
Interest expense | 33 | 0 | 33 | 0 |
Income before income taxes | 2,053 | 984 | 3,821 | 1,878 |
Income taxes | 371 | 158 | 693 | 300 |
Net income attributable to noncontrolling interests | 1,682 | 826 | 3,128 | 1,578 |
Ad Fund VIEs | ' | ' | ' | ' |
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Sales | 0 | 0 | 0 | 0 |
Advertising levies | 2,906 | 2,569 | 5,898 | 5,100 |
Total revenues | 2,906 | 2,569 | 5,898 | 5,100 |
Cost of sales | 0 | 0 | 0 | 0 |
Operating expenses | 2,704 | 2,293 | 5,466 | 4,392 |
Operating income | 202 | 276 | 432 | 708 |
Interest expense | 202 | 276 | 432 | 708 |
Income before income taxes | 0 | 0 | 0 | 0 |
Income taxes | 0 | 0 | 0 | 0 |
Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
VIEs | ' | ' | ' | ' |
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Sales | 94,328 | 93,464 | 177,709 | 180,224 |
Advertising levies | 2,906 | 2,569 | 5,898 | 5,100 |
Total revenues | 97,234 | 96,033 | 183,607 | 185,324 |
Cost of sales | 92,242 | 92,480 | 173,855 | 178,346 |
Operating expenses | 2,704 | 2,293 | 5,466 | 4,392 |
Operating income | 2,288 | 1,260 | 4,286 | 2,586 |
Interest expense | 235 | 276 | 465 | 708 |
Income before income taxes | 2,053 | 984 | 3,821 | 1,878 |
Income taxes | 371 | 158 | 693 | 300 |
Net income attributable to noncontrolling interests | 1,682 | 826 | 3,128 | 1,578 |
Assets_and_Liabilities_of_Vari
Assets and Liabilities of Variable Interest Entities (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 | Jun. 30, 2013 | Dec. 30, 2012 |
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | 25,087,000 | 50,414,000 | 86,603,000 | 120,139,000 |
Advertising fund restricted assets b current | 39,078,000 | 39,783,000 | ' | ' |
Property and equipment, net | 1,681,010,000 | 1,685,043,000 | ' | ' |
Other long-term assets | 117,452,000 | 117,552,000 | ' | ' |
Total assets | 2,356,753,000 | 2,433,823,000 | ' | ' |
Total Accrued liabilities | 65,835,000 | 89,565,000 | ' | ' |
Other long-term liabilities | 108,557,000 | 112,090,000 | ' | ' |
Equity of VIEs | 1,608,000 | 365,000 | ' | ' |
Total liabilities and equity | 2,356,753,000 | 2,433,823,000 | ' | ' |
Restaurant VIEs | ' | ' | ' | ' |
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | 7,733,000 | 7,773,000 | ' | ' |
Advertising fund restricted assets b current | 0 | 0 | ' | ' |
Other current assets | 7,060,000 | 7,155,000 | ' | ' |
Property and equipment, net | 19,638,000 | 20,471,000 | ' | ' |
Other long-term assets | 119,000 | 370,000 | ' | ' |
Total assets | 34,550,000 | 35,769,000 | ' | ' |
Notes payable to Tim Hortons Inc. b current | 12,996,000 | 13,689,000 | ' | ' |
Advertising fund liabilities b current | 0 | 0 | ' | ' |
Total Accrued liabilities | 11,313,000 | 11,706,000 | ' | ' |
Notes payable to Tim Hortons Inc. - long-term | 543,000 | 628,000 | ' | ' |
Long-term debt | 0 | 0 | ' | ' |
Other long-term liabilities | 8,090,000 | 9,381,000 | ' | ' |
Total liabilities | 32,942,000 | 35,404,000 | ' | ' |
Equity of VIEs | 1,608,000 | 365,000 | ' | ' |
Total liabilities and equity | 34,550,000 | 35,769,000 | ' | ' |
Ad Fund VIEs | ' | ' | ' | ' |
Variable Interest Entity [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | 0 | 0 | ' | ' |
Advertising fund restricted assets b current | 39,078,000 | 39,783,000 | ' | ' |
Other current assets | 0 | 0 | ' | ' |
Property and equipment, net | 65,661,000 | 70,485,000 | ' | ' |
Other long-term assets | 960,000 | 1,271,000 | ' | ' |
Total assets | 105,699,000 | 111,539,000 | ' | ' |
Notes payable to Tim Hortons Inc. b current | 23,040,000 | 3,040,000 | ' | ' |
Advertising fund liabilities b current | 38,782,000 | 59,913,000 | ' | ' |
Total Accrued liabilities | 5,268,000 | 5,253,000 | ' | ' |
Notes payable to Tim Hortons Inc. - long-term | 13,680,000 | 15,200,000 | ' | ' |
Long-term debt | 22,641,000 | 25,157,000 | ' | ' |
Other long-term liabilities | 2,288,000 | 2,976,000 | ' | ' |
Total liabilities | 105,699,000 | 111,539,000 | ' | ' |
Equity of VIEs | 0 | 0 | ' | ' |
Total liabilities and equity | 105,699,000 | 111,539,000 | ' | ' |
Assets_and_Liabilities_of_Vari1
Assets and Liabilities of Variable Interest Entities (Parenthetical) (Detail) (CAD) | Jun. 29, 2014 | Dec. 29, 2013 |
Variable Interest Entity [Line Items] | ' | ' |
Other liabilities | 18,336,000 | 17,782,000 |
Restaurant VIEs | ' | ' |
Variable Interest Entity [Line Items] | ' | ' |
Number of Consolidated Non Owned Restaurants | 328 | 331 |
Notes payable to Tim Hortons Inc. b current | 12,996,000 | 13,689,000 |
Ad Fund VIEs | ' | ' |
Variable Interest Entity [Line Items] | ' | ' |
Notes payable to Tim Hortons Inc. b current | 23,040,000 | 3,040,000 |
Ad Fund VIEs | Revolving Credit Facility | ' | ' |
Variable Interest Entity [Line Items] | ' | ' |
Notes payable to Tim Hortons Inc. b current | 20,000,000 | 0 |
Ad Fund VIEs | Term Loan | ' | ' |
Variable Interest Entity [Line Items] | ' | ' |
Advertising fund term debt | 27,700,000 | 30,200,000 |
Other liabilities | 5,000,000 | 5,000,000 |
Information_on_Reportable_Segm
Information on Reportable Segments (Detail) (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Revenues | 874,347 | 800,139 | 1,640,749 | 1,531,676 |
Operating income | 192,367 | 176,579 | 337,654 | 304,496 |
Interest, Net | -17,510 | -8,131 | -33,209 | -15,866 |
Income before income taxes | 174,857 | 168,448 | 304,445 | 288,630 |
Operating Segments | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Revenues | 777,113 | 704,106 | 1,457,142 | 1,346,352 |
Operating income | 190,079 | 175,923 | 333,368 | 311,989 |
Operating Segments | Canada | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Revenues | 721,599 | 657,682 | 1,344,784 | 1,251,355 |
Operating income | 188,866 | 174,760 | 342,332 | 320,581 |
Operating Segments | U.S. | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Revenues | 51,878 | 41,220 | 103,053 | 85,668 |
Operating income | 9,254 | 2,587 | 13,611 | 3,497 |
Operating Segments | Corporate Services | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Revenues | 3,636 | 5,204 | 9,305 | 9,329 |
Operating income | -8,041 | -1,424 | -22,575 | -12,089 |
VIEs | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Revenues | 97,234 | 96,033 | 183,607 | 185,324 |
Operating income | 2,288 | 1,260 | 4,286 | 2,586 |
Corporate Reorganization Expenses | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Operating income | 0 | -604 | 0 | -10,079 |
Consolidated_Sales_Information
Consolidated Sales Information (Detail) (CAD) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 29, 2014 | Jun. 30, 2013 | Jun. 29, 2014 | Jun. 30, 2013 |
Segment Reporting [Abstract] | ' | ' | ' | ' |
Distribution sales | 511,762 | 468,597 | 964,115 | 899,748 |
Company-operated restaurant sales | 7,739 | 6,501 | 13,035 | 12,477 |
Sales from VIEs | 94,328 | 93,464 | 177,709 | 180,224 |
Total Sales | 613,829 | 568,562 | 1,154,859 | 1,092,449 |