Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 29, 2014 | 2-May-14 | |
Document Documentand Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 29-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Trading Symbol | 'DNKN | ' |
Entity Registrant Name | 'DUNKIN' BRANDS GROUP, INC. | ' |
Entity Central Index Key | '0001357204 | ' |
Current Fiscal Year End Date | '--12-27 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 106,344,586 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 29, 2014 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $202,420 | $256,933 |
Accounts receivable, net of allowance for doubtful accounts of $3,191 and $2,599 as of March 29, 2014 and December 28, 2013, respectively | 47,870 | 47,162 |
Notes and other receivables, net of allowance for doubtful accounts of $972 and $659 as of March 29, 2014 and December 28, 2013, respectively | 8,682 | 32,603 |
Deferred income taxes, net | 46,222 | 46,461 |
Restricted assets of advertising funds | 35,579 | 31,493 |
Prepaid income taxes | 20,461 | 25,699 |
Prepaid expenses and other current assets | 23,490 | 21,409 |
Total current assets | 384,724 | 461,760 |
Property and equipment, net of accumulated depreciation of $97,789 and $105,834 as of March 29, 2014 and December 28, 2013, respectively | 177,090 | 182,858 |
Equity method investments | 169,307 | 170,644 |
Goodwill | 890,391 | 891,598 |
Other intangible assets, net of accumulated amortization of $205,451 and $200,248 as of March 29, 2014 and December 28, 2013, respectively | 1,445,517 | 1,452,205 |
Other assets | 69,291 | 75,625 |
Total assets | 3,136,320 | 3,234,690 |
Current liabilities: | ' | ' |
Current portion of long-term debt | 0 | 5,000 |
Capital lease obligations | 458 | 432 |
Accounts payable | 11,633 | 12,445 |
Liabilities of advertising funds | 50,176 | 49,077 |
Deferred income | 28,740 | 28,426 |
Other current liabilities | 176,890 | 248,918 |
Total current liabilities | 267,897 | 344,298 |
Long-term debt, net | 1,813,245 | 1,818,609 |
Capital lease obligations | 7,055 | 6,996 |
Unfavorable operating leases acquired | 16,300 | 16,834 |
Deferred income | 11,835 | 11,135 |
Deferred income taxes, net | 557,769 | 561,714 |
Other long-term liabilities | 64,116 | 62,816 |
Total long-term liabilities | 2,470,320 | 2,478,104 |
Commitments and contingencies (note 10) | ' | ' |
Redeemable noncontrolling interests | 4,802 | 4,930 |
Stockholders' equity: | ' | ' |
Preferred stock, $0.001 par value; 25,000,000 shares authorized; no shares issued and outstanding at March 29, 2014 and December 28, 2013, respectively | ' | ' |
Common stock, $0.001 par value; 475,000,000 shares authorized; 107,501,189 issued and 106,758,284 outstanding at March 29, 2014; 106,876,919 shares issued and 106,646,219 shares outstanding at December 28, 2013 | 107 | 107 |
Additional paid-in capital | 1,182,523 | 1,196,426 |
Treasury stock, at cost | -34,771 | -10,773 |
Accumulated deficit | -757,145 | -779,741 |
Accumulated other comprehensive income | 2,587 | 1,339 |
Total stockholders’ equity | 393,301 | 407,358 |
Total liabilities, redeemable noncontrolling interests, and stockholders’ equity | $3,136,320 | $3,234,690 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 29, 2014 | Dec. 28, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Accounts receivable, allowance for doubtful accounts | $3,191 | $2,599 |
Notes and other receivables, allowance for doubtful accounts | 972 | 659 |
Property and equipment, accumulated depreciation | 97,789 | 105,834 |
Other intangible assets, accumulated amortization | $205,451 | $200,248 |
Preferred stock, par value (in usd per share) | $0.00 | $0.00 |
Preferred stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Preferred stock, shares issued (in shares) | ' | ' |
Preferred stock, shares outstanding (in shares) | ' | ' |
Common stock, par value (in usd per share) | $0.00 | $0.00 |
Common stock, shares authorized (in shares) | 475,000,000 | 475,000,000 |
Common stock, shares issued (in shares) | 107,501,189 | 106,876,919 |
Common stock, shares outstanding (in shares) | 106,758,284 | 106,646,219 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Revenues: | ' | ' |
Franchise fees and royalty income | $106,712 | $103,765 |
Rental income | 22,447 | 22,432 |
Sales of ice cream products | 28,671 | 23,580 |
Sales at company-owned restaurants | 6,316 | 5,771 |
Other revenues | 7,802 | 6,310 |
Total revenues | 171,948 | 161,858 |
Operating costs and expenses: | ' | ' |
Occupancy expenses-franchised restaurants | 13,012 | 12,776 |
Cost of ice cream products | 19,748 | 15,986 |
Company-owned restaurant expenses | 6,363 | 5,655 |
General and administrative expenses, net | 59,714 | 55,577 |
Depreciation | 4,913 | 5,848 |
Amortization of other intangible assets | 6,405 | 6,582 |
Impairment charges | 123 | 248 |
Total operating costs and expenses | 110,278 | 102,672 |
Net income of equity method investments | 3,100 | 3,087 |
Other operating income, net | 4,327 | 1,186 |
Operating income | 69,097 | 63,459 |
Other income (expense): | ' | ' |
Interest income | 69 | 114 |
Interest expense | -17,941 | -20,832 |
Loss on debt extinguishment and refinancing transactions | -13,735 | -5,018 |
Other gains (losses), net | 27 | -390 |
Total other expense | -31,580 | -26,126 |
Income before income taxes | 37,517 | 37,333 |
Provision for income taxes | 14,689 | 13,672 |
Net income including noncontrolling interests | 22,828 | 23,661 |
Net loss attributable to noncontrolling interests | -128 | -137 |
Net income attributable to Dunkin' Brands | $22,956 | $23,798 |
Earnings per share: | ' | ' |
Common-basic | $0.22 | $0.22 |
Common-diluted | $0.21 | $0.22 |
Cash dividends declared per common share | $0.23 | $0.19 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' |
Net income including noncontrolling interests | $22,828 | $23,661 |
Other comprehensive income (loss), net: | ' | ' |
Effect of foreign currency translation, net of deferred tax expense of $313 and $134 for the three months ended March 29, 2014 and March 30, 2013, respectively | 1,291 | -10,805 |
Unrealized gains (losses) on interest rate swaps, net of deferred tax expense (benefit) of $(457) and $562 for the three months ended March 29, 2014 and March 30, 2013, respectively | -701 | 779 |
Other, net | 658 | 20 |
Total other comprehensive income (loss) | 1,248 | -10,006 |
Comprehensive income including noncontrolling interests | 24,076 | 13,655 |
Comprehensive loss attributable to noncontrolling interests | -128 | -137 |
Comprehensive income attributable to Dunkin' Brands | $24,204 | $13,792 |
Consolidated_Statements_of_Com1
Consolidated Statements of Comprehensive Income Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Statement of Other Comprehensive Income (Parenthetical) [Abstract] | ' | ' |
Deferred tax effect, foreign currency translation | $313 | $134 |
Deferred tax effect, unrealized gains on interest rate swaps | ($457) | $562 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Cash flows from operating activities: | ' | ' |
Net income including noncontrolling interests | $22,828 | $23,661 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ' | ' |
Depreciation and amortization | 11,318 | 12,430 |
Amortization of deferred financing costs and original issue discount | 1,038 | 1,367 |
Loss on debt extinguishment and refinancing transactions | 13,735 | 5,018 |
Deferred income taxes | -3,842 | -5,740 |
Provision for (recovery of) bad debt | 1,365 | -153 |
Share-based compensation expense | 1,849 | 1,618 |
Net income of equity method investments | -3,100 | -3,087 |
Dividends received from equity method investments | 5,825 | 5,527 |
Other, net | -4,729 | 64 |
Change in operating assets and liabilities: | ' | ' |
Accounts, notes, and other receivables, net | 22,062 | 4,210 |
Other current assets | 1,335 | -1,451 |
Accounts payable | -733 | 1,273 |
Other current liabilities | -72,566 | -74,756 |
Liabilities of advertising funds, net | -2,746 | 872 |
Income taxes payable, net | 5,363 | 1,996 |
Deferred income | 917 | -1,057 |
Other, net | 1,694 | 1,210 |
Net cash provided by (used in) operating activities | 1,613 | -26,998 |
Cash flows from investing activities: | ' | ' |
Additions to property and equipment | -4,436 | -7,808 |
Proceeds from sale of joint venture | 6,937 | 0 |
Other, net | -1,418 | 1,000 |
Net cash provided by (used in) investing activities | 1,083 | -6,808 |
Cash flows from financing activities: | ' | ' |
Repayment of long-term debt | -10,000 | -14,157 |
Payment of deferred financing and other debt-related costs | -8,977 | -6,115 |
Dividends paid on common stock | -24,520 | -20,191 |
Repurchases of common stock | -22,040 | 0 |
Exercise of stock options | 3,411 | 1,092 |
Excess tax benefits from share-based compensation | 5,465 | 0 |
Other, net | -568 | -118 |
Net cash used in financing activities | -57,229 | -39,489 |
Effect of exchange rates on cash and cash equivalents | 20 | -137 |
Decrease in cash and cash equivalents | -54,513 | -73,432 |
Cash and cash equivalents, beginning of period | 256,933 | 252,618 |
Cash and cash equivalents, end of period | 202,420 | 179,186 |
Supplemental cash flow information: | ' | ' |
Cash paid for income taxes | 7,618 | 17,480 |
Cash paid for interest | 19,900 | 30,787 |
Noncash investing and financing activities: | ' | ' |
Property and equipment included in accounts payable and other current liabilities | 857 | 1,624 |
Purchase of leaseholds in exchange for capital lease obligations | 185 | 0 |
Repurchases of common stock included in other current liabilities | $1,958 | $0 |
Description_of_Business_and_Or
Description of Business and Organization | 3 Months Ended |
Mar. 29, 2014 | |
Text Block [Abstract] | ' |
Description of Business and Organization | ' |
Description of Business and Organization | |
Dunkin’ Brands Group, Inc. (“DBGI”), together with its consolidated subsidiaries, is one of the world’s leading franchisors of restaurants serving coffee and baked goods, as well as ice cream, within the quick service restaurant segment of the restaurant industry. We develop, franchise, and license a system of both traditional and nontraditional quick service restaurants and, in limited circumstances, own and operate individual locations. Through our Dunkin’ Donuts brand, we develop and franchise restaurants featuring coffee, donuts, bagels, breakfast sandwiches, and related products. Through our Baskin-Robbins brand, we develop and franchise restaurants featuring ice cream, frozen beverages, and related products. Additionally, we distribute Baskin-Robbins ice cream products to Baskin-Robbins franchisees and licensees in certain international markets. | |
Throughout these unaudited consolidated financial statements, “Dunkin’ Brands,” “the Company,” “we,” “us,” “our,” and “management” refer to DBGI and its consolidated subsidiaries taken as a whole. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended | ||||||||||||||||||
Mar. 29, 2014 | |||||||||||||||||||
Disclosure Summary Of Significant Accounting Policies Additional Information [Abstract] | ' | ||||||||||||||||||
Summary of Significant Accounting Policies | ' | ||||||||||||||||||
Summary of Significant Accounting Policies | |||||||||||||||||||
(a) Unaudited Consolidated Financial Statements | |||||||||||||||||||
The consolidated balance sheet as of March 29, 2014, the consolidated statements of operations, comprehensive income, and cash flows for the three months ended March 29, 2014 and March 30, 2013, are unaudited. | |||||||||||||||||||
The accompanying unaudited consolidated financial statements include the accounts of DBGI and its consolidated subsidiaries and have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements. All significant transactions and balances between subsidiaries and affiliates have been eliminated in consolidation. In the opinion of management, all adjustments necessary for a fair presentation of such financial statements in accordance with U.S. GAAP have been recorded. Such adjustments consisted only of normal recurring items. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended December 28, 2013, included in the Company’s Annual Report on Form 10-K. | |||||||||||||||||||
(b) Fiscal Year | |||||||||||||||||||
The Company operates and reports financial information on a 52- or 53-week year on a 13-week quarter basis with the fiscal year ending on the last Saturday in December and fiscal quarters ending on the 13th Saturday of each quarter (or 14th Saturday when applicable with respect to the fourth fiscal quarter). The data periods contained within our three month periods ended March 29, 2014 and March 30, 2013 reflect the results of operations for the 13-week periods ended on those dates. Operating results for the three months ended March 29, 2014 is not necessarily indicative of the results that may be expected for the fiscal year ending December 27, 2014. | |||||||||||||||||||
(c) Fair Value of Financial Instruments | |||||||||||||||||||
Financial assets and liabilities are categorized, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to the quoted prices in active markets for identical assets and liabilities and lowest priority to unobservable inputs. Observable market data, when available, is required to be used in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. | |||||||||||||||||||
Financial assets and liabilities measured at fair value on a recurring basis as of March 29, 2014 and December 28, 2013 are summarized as follows (in thousands): | |||||||||||||||||||
29-Mar-14 | 28-Dec-13 | ||||||||||||||||||
Quoted prices | Significant | Total | Quoted prices | Significant | Total | ||||||||||||||
in active | other | in active | other | ||||||||||||||||
markets for | observable | markets for | observable | ||||||||||||||||
identical assets | inputs | identical assets | inputs | ||||||||||||||||
(Level 1) | (Level 2) | (Level 1) | (Level 2) | ||||||||||||||||
Assets: | |||||||||||||||||||
Mutual funds | $ | 649 | — | 649 | 1,012 | — | 1,012 | ||||||||||||
Interest rate swaps | — | 9,155 | 9,155 | — | 10,221 | 10,221 | |||||||||||||
Total assets | $ | 649 | 9,155 | 9,804 | 1,012 | 10,221 | 11,233 | ||||||||||||
Liabilities: | |||||||||||||||||||
Deferred compensation liabilities | $ | — | 7,555 | 7,555 | — | 7,181 | 7,181 | ||||||||||||
Total liabilities | $ | — | 7,555 | 7,555 | — | 7,181 | 7,181 | ||||||||||||
The deferred compensation liabilities primarily relate to the Dunkin’ Brands, Inc. Non-Qualified Deferred Compensation Plan (“NQDC Plan”), which allows for pre-tax salary deferrals for certain qualifying employees. Changes in the fair value of the deferred compensation liabilities are derived using quoted prices in active markets of the asset selections made by the participants. The deferred compensation liabilities are classified within Level 2, as defined under U.S. GAAP, because their inputs are derived principally from observable market data by correlation to hypothetical investments. The Company holds mutual funds, as well as money market funds, to partially offset the Company’s liabilities under certain benefit plans. The changes in the fair value of the mutual funds are derived using quoted prices in active markets for the specific funds. As such, the mutual funds are classified within Level 1, as defined under U.S. GAAP. | |||||||||||||||||||
The Company uses readily available market data to value its interest rate swaps, such as interest rate curves and discount factors. Additionally, the fair value of derivatives includes consideration of credit risk in the valuation. The Company uses a potential future exposure model to estimate this credit valuation adjustment (“CVA”). The inputs to the CVA are largely based on observable market data, with the exception of certain assumptions regarding credit worthiness which make the CVA a Level 3 input, as defined under U.S. GAAP. As the magnitude of the CVA is not a significant component of the fair value of the interest rate swaps as of March 29, 2014, it is not considered a significant input and the derivatives are classified as Level 2. | |||||||||||||||||||
The carrying value and estimated fair value of long-term debt as of March 29, 2014 and December 28, 2013 were as follows (in thousands): | |||||||||||||||||||
29-Mar-14 | 28-Dec-13 | ||||||||||||||||||
Carrying Value | Estimated fair value | Carrying Value | Estimated fair value | ||||||||||||||||
Financial liabilities | |||||||||||||||||||
Term loans | $ | 1,813,245 | 1,816,414 | 1,823,609 | 1,836,212 | ||||||||||||||
The estimated fair value of our term loans is estimated based on current bid prices for our term loans. Judgment is required to develop these estimates. As such, our term loans are classified within Level 2, as defined under U.S. GAAP. | |||||||||||||||||||
(d) Derivative Instruments and Hedging Activities | |||||||||||||||||||
The Company uses derivative instruments to hedge interest rate risks. These derivative contracts are entered into with financial institutions. The Company does not use derivative instruments for trading purposes and we have procedures in place to monitor and control their use. | |||||||||||||||||||
We record all derivative instruments on our consolidated balance sheets at fair value. For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative instruments is reported as a component of other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Any ineffective portion of the gain or loss on the derivative instrument for a cash flow hedge is recorded in the consolidated statements of operations immediately. Cash flows associated with the Company's interest rate swap agreements are classified as cash flows from operating activities in the consolidated statements of cash flows which is consistent with the classification of cash flows of the underlying hedged item. See note 5 for a discussion of the Company's use of derivative instruments, management of credit risk inherent in derivative instruments, and fair value information. | |||||||||||||||||||
(e) Concentration of Credit Risk | |||||||||||||||||||
The Company is subject to credit risk through its accounts receivable consisting primarily of amounts due from franchisees and licensees for franchise fees, royalty income, and sales of ice cream products. In addition, we have note and lease receivables from certain of our franchisees and licensees. The financial condition of these franchisees and licensees is largely dependent upon the underlying business trends of our brands and market conditions within the quick service restaurant industry. This concentration of credit risk is mitigated, in part, by the large number of franchisees and licensees of each brand and the short-term nature of the franchise and license fee and lease receivables. At March 29, 2014 and December 28, 2013, one master licensee, including its majority-owned subsidiaries, accounted for approximately 27% and 17%, respectively, of total accounts and notes receivable, which was primarily due to the timing of orders and shipments of ice cream to the master licensee. For the three months ended March 29, 2014, one master licensee, including its majority-owned subsidiaries, accounted for approximately 11% of total revenues. No individual franchisee or master licensee accounted for more than 10% of total revenues for the three months ended March 30, 2013. | |||||||||||||||||||
(f) Recent Accounting Pronouncements | |||||||||||||||||||
In July 2013, the Financial Accounting Standards Board (“FASB”) issued new guidance which requires presentation of an unrecognized tax benefit as a reduction of a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except in certain circumstances. This guidance was adopted by the Company in fiscal year 2014. The adoption of this guidance did not have any impact on the Company’s consolidated financial statements. | |||||||||||||||||||
(g) Reclassifications | |||||||||||||||||||
The Company has revised the presentation of certain income generating transactions that historically were recorded within general and administrative expenses, net in the consolidated statements of operations. Income from these transactions totaling $1.2 million have been reclassified into other operating income, net, for the three months ended March 30, 2013 in the consolidated statements of operations to conform to the current year presentation. There is no impact to total revenues, operating income, income before income taxes, or net income as a result of these reclassifications. | |||||||||||||||||||
The Company has also revised the presentation of certain asset captions within the consolidated balance sheets to conform to the current period presentation, including combining 'assets held for sale' with 'prepaid expense and other current assets' and combining 'restricted cash' with 'other assets'. The revisions had no impact on total current assets or total assets. | |||||||||||||||||||
Additionally, the Company has revised the presentation of certain captions for the three months ended March 30, 2013 within the consolidated statements of cash flows to conform to the current period presentation. The revisions had no impact on net cash used in operating, investing, or financing activities. | |||||||||||||||||||
(h) Subsequent Events | |||||||||||||||||||
Subsequent events have been evaluated through the date these consolidated financial statements were filed. |
Franchise_Fees_and_Royalty_Inc
Franchise Fees and Royalty Income | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Disclosure Franchise Fees And Royalty Income [Abstract] | ' | ||||||
Franchise Fees and Royalty Income | ' | ||||||
Franchise Fees and Royalty Income | |||||||
Franchise fees and royalty income consisted of the following (in thousands): | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Royalty income | $ | 98,599 | 93,222 | ||||
Initial franchise fees and renewal income | 8,113 | 10,543 | |||||
Total franchise fees and royalty income | $ | 106,712 | 103,765 | ||||
The changes in franchised and company-owned points of distribution were as follows: | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Systemwide Points of Distribution: | |||||||
Franchised points of distribution—beginning of period | 18,122 | 17,333 | |||||
Franchised points of distribution—opened | 266 | 244 | |||||
Franchised points of distribution—closed | (170 | ) | (131 | ) | |||
Franchised points of distribution in operation—end of period | 18,218 | 17,446 | |||||
Company-owned points of distribution—end of period | 36 | 30 | |||||
Total systemwide points of distribution—end of period | 18,254 | 17,476 | |||||
During fiscal year 2013, the Company performed an internal review of international franchised points of distribution, and determined that certain franchises opened and closed had not been accurately reported in prior years. As such, the points of distribution information for the three months ended March 30, 2013 have been adjusted to reflect the results of this internal review. The adjustments to the prior years were not material, and had no impact on the Company's financial position or results of operations. Franchised points of distribution in operation—beginning of period and franchised points of distribution in operation—end of period were reduced by 91 for the three months ended March 30, 2013. |
Debt
Debt | 3 Months Ended |
Mar. 29, 2014 | |
Debt Disclosure [Abstract] | ' |
Debt | ' |
Debt | |
In February 2014, Dunkin’ Brands, Inc. (“DBI”), a subsidiary of DBGI, amended its senior credit facility, resulting in a reduction of interest rates. The senior credit facility now consists of $1.38 billion in term loans due February 2021 (“2021 Term Loans”), $450.0 million in term loans due September 2017 (“2017 Term Loans”), and a $100.0 million revolving credit facility that matures in February 2019. | |
The 2021 Term Loans bear interest at a rate per annum equal to an applicable margin plus, at our option, either (1) a base rate determined by reference to the highest of (a) the Federal Funds rate plus 0.5%, (b) the prime rate, (c) LIBOR plus 1.0%, and (d) 1.75% or (2) LIBOR provided that LIBOR shall not be lower than 0.75%. The applicable margin under the term loan facility is 1.50% for loans based upon the base rate and 2.50% for loans based upon LIBOR. | |
The 2017 Term Loans bear interest at a rate per annum equal to an applicable margin plus, at our option, either (1) a base rate determined by reference to the highest of (a) the Federal Funds rate plus 0.5%, (b) the prime rate, and (c) LIBOR plus 1.0%, or (2) LIBOR. The applicable margin under the term loan facility is 1.50% for loans based upon the base rate and 2.50% for loans based upon LIBOR. | |
The effective interest rate for the term loans, including the amortization of original issue discount and deferred financing costs, was 3.5% and 2.8% for the 2021 Term Loans and 2017 Term Loans, respectively, at March 29, 2014. | |
Subsequent to the amendment, borrowings under the revolving credit facility bear interest at a rate per annum equal to an applicable margin plus, at our option, either (1) a base rate determined by reference to the highest of (a) the Federal Funds rate plus 0.5%, (b) the prime rate, and (c) LIBOR plus 1.0%, or (2) LIBOR. The applicable margin under the revolving credit facility is 1.25% for loans based upon the base rate and 2.25% for loans based upon LIBOR. In addition, we are required to pay a 0.5% commitment fee per annum on the unused portion of the revolver and a fee for letter of credit amounts outstanding of 2.25%. | |
In connection with the amendment, certain lenders, holding $684.7 million of term loans, exited the term loan lending syndicate. The principal of the exiting lenders was replaced with additional loans from both existing and new lenders. As a result, during the first quarter of 2014, the Company recorded a loss on debt extinguishment and refinancing transactions of $13.7 million, including $10.5 million related to the write-off of original issuance discount and deferred financing costs and $3.2 million of fees paid to third parties. The amended term loans were issued with an original issue discount of 0.25%, or $4.6 million, which was recorded as a reduction to long-term debt. Total debt issuance costs incurred and capitalized in connection with this amendment were $1.2 million. | |
In February 2013, the Company amended its senior credit facility, resulting in a reduction of interest rates and an extension of the maturity dates for both the term loans and the revolving credit facility. As a result of the amendment, the Company recorded a loss on debt extinguishment and refinancing transactions of $5.0 million during the first quarter of 2013, including $3.9 million related to the write-off of original issuance discount and deferred financing costs and $1.1 million of fees paid to third parties. The amended term loans were issued with an original issue discount of 0.25%, or $4.6 million, which was recorded as a reduction to long-term debt. | |
Principal payments are required to be made on the 2017 Term Loans equal to $4.5 million per calendar year, payable in quarterly installments beginning June 2014 through June 2017, of which $5.0 million had been voluntarily prepaid as of March 29, 2014. Principal payments are required to be made on the 2021 Term Loans equal to approximately $13.8 million per calendar year, payable in quarterly installments beginning June 2015 through December 2020. The final scheduled principal payments on the outstanding borrowings under the 2017 Term Loans and 2021 Term Loans are due in September 2017 and February 2021, respectively. Additionally, following the end of each fiscal year, the Company is required to prepay an amount equal to 25% of excess cash flow (as defined in the senior credit facility) for such fiscal year. If DBI’s leverage ratio, which is a measure of DBI’s outstanding debt to earnings before interest, taxes, depreciation, and amortization, adjusted for certain items (as specified in the senior credit facility), is no greater than 4.75x, no excess cash flow payments are required. If DBI’s leverage ratio is greater than 5.50x, the Company is required to prepay an amount equal to 50% of excess cash flow. Considering the voluntary prepayments made, no additional principal payments are required in the next twelve months as of March 29, 2014, though the Company may elect to make voluntary prepayments. Other events and transactions, such as certain asset sales and incurrence of debt, may trigger additional mandatory prepayments. |
Derivative_Instruments_and_Hed
Derivative Instruments and Hedging Transactions | 3 Months Ended | |||||||||||||
Mar. 29, 2014 | ||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||
Derivative Instruments and Hedging Transactions | ' | |||||||||||||
Derivative Instruments and Hedging Transactions | ||||||||||||||
The Company is exposed to global market risks, including the effect of changes in interest rates, and may use derivative instruments to mitigate the impact of these changes. The Company does not use derivatives with a level of complexity or with a risk higher than the exposures to be hedged and does not hold or issue derivatives for trading purposes. The Company’s hedging instruments consist solely of interest rate swaps at March 29, 2014. The Company’s risk management objective and strategy with respect to the interest rate swaps is to limit the Company’s exposure to increased interest rates on its variable rate debt by reducing the potential variability in cash flow requirements relating to interest payments on a portion of its outstanding debt. The Company documents its risk management objective and strategy for undertaking hedging transactions, as well as all relationships between hedging instruments and hedged items. | ||||||||||||||
In September 2012, the Company entered into variable-to-fixed interest rate swap agreements with three counterparties to hedge the risk of increases in cash flows (interest payments) attributable to increases in three-month LIBOR above the designated benchmark interest rate being hedged, through November 2017. Interest is settled quarterly on a net basis with each counterparty. The swaps have been designated as hedging instruments and are classified as cash flow hedges. They are recognized on the Company’s consolidated balance sheets at fair value and classified based on the instruments’ maturity dates. Changes in the fair value measurements of the derivative instruments are reflected as adjustments to other comprehensive income (loss), or current earnings if there is ineffectiveness of the derivative instruments during the period. | ||||||||||||||
As a result of the February 2014 amendment to the senior credit facility, the Company amended the interest rate swap agreements to align the embedded floors with the amended term loans. As a result of the amendments to the interest rate swap agreements, the Company will be required to make quarterly payments on the notional amount at a fixed average interest rate of approximately 1.22%, resulting in a total interest rate of approximately 3.72% on the hedged amount when considering the applicable margin in effect at March 29, 2014. In exchange, the Company will receive interest on the notional amount at a variable rate based on three-month LIBOR spot rate, subject to a floor of 0.75%. There was no change to the term and the notional amount of the term loan borrowings being hedged of $900.0 million. | ||||||||||||||
As a result of the amendment to the interest rate swaps, the Company does not expect the hedging relationship to have a material amount of ineffectiveness. During the three months ended March 29, 2014 and March 30, 2013, there was no ineffectiveness of the interest rate swaps, and therefore, ineffectiveness had no impact on the consolidated statements of operations. As of the date of the amendment, a cumulative unrealized gain of $5.8 million was recorded in accumulated other comprehensive income, which will be amortized on a straight-line basis to interest expense in the consolidated statements of operations through the maturity date. | ||||||||||||||
The fair values of derivatives instruments consisted of the following (in thousands): | ||||||||||||||
March 29, | December 28, | Consolidated Balance Sheet Classification | ||||||||||||
2014 | 2013 | |||||||||||||
Interest rate swaps - asset | $ | 9,155 | 10,221 | Other assets | ||||||||||
Total fair values of derivative instruments - asset | $ | 9,155 | 10,221 | |||||||||||
The table below summarizes the effects of derivative instruments on the consolidated statements of operations and comprehensive income (loss) for the three months ended March 29, 2014 (in thousands): | ||||||||||||||
Derivatives designated as cash flow hedging instruments | Amount of gain (loss) recognized in other comprehensive income (loss) | Amount of net gain (loss) reclassified into earnings(1) | Consolidated statement of operations classification | Total effect on other comprehensive income (loss) | ||||||||||
Interest rate swaps | $ | (2,035 | ) | (877 | ) | Interest expense | $ | (1,158 | ) | |||||
Income tax effect | 803 | 346 | Provision for income taxes | 457 | ||||||||||
Net of income taxes | $ | (1,232 | ) | (531 | ) | $ | (701 | ) | ||||||
(1) | The total net gain (loss) reclassified from accumulated other comprehensive income into interest expense in the consolidated statements of operations includes the straight-line amortization of the unrealized gain that remained in accumulated other comprehensive income as of the date of the amendment. | |||||||||||||
The table below summarizes the effects of derivative instruments on the consolidated statements of operations and comprehensive income (loss) for the three months ended March 30, 2013 (in thousands): | ||||||||||||||
Derivatives designated as cash flow hedging instruments | Amount of gain (loss) recognized in other comprehensive income (loss) | Amount of net gain (loss) reclassified into earnings | Consolidated statement of operations classification | Total effect on other comprehensive income (loss) | ||||||||||
Interest rate swaps | $ | 495 | (846 | ) | Interest expense | $ | 1,341 | |||||||
Income tax effect | (207 | ) | 355 | Provision for income taxes | (562 | ) | ||||||||
Net of income taxes | $ | 288 | (491 | ) | $ | 779 | ||||||||
As of March 29, 2014 and December 28, 2013, $951 thousand and $836 thousand, respectively, of interest expense related to interest rate swaps is accrued in other current liabilities in the consolidated balance sheets. During the next twelve months, the Company estimates that $4.2 million will be reclassified from accumulated other comprehensive income as an increase to interest expense based on current projections of LIBOR. | ||||||||||||||
The Company is exposed to credit-related losses in the event of non-performance by the counterparties to its hedging instruments. To mitigate counterparty credit risk, the Company only enters into contracts with major financial institutions based upon their credit ratings and other factors, and continually assesses the creditworthiness of its counterparties. At March 29, 2014, all of the counterparties to the interest rate swaps had investment grade ratings. To date, all counterparties have performed in accordance with their contractual obligations. | ||||||||||||||
The Company has agreements with each of its derivative counterparties that contain a provision whereby if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations. As of March 29, 2014, the Company has not posted any collateral related to these agreements. The Company holds one derivative instrument with each of its derivative counterparties, each of which is settled net with the respective counterparties in accordance with the swap agreements. There is no offsetting of these financial instruments on the consolidated balance sheets. As of March 29, 2014, the termination value of derivatives is a net asset position of $8.4 million, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements. |
Other_Current_Liabilities
Other Current Liabilities | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Other Liabilities, Current [Abstract] | ' | ||||||
Other Current Liabilities | ' | ||||||
Other Current Liabilities | |||||||
Other current liabilities consisted of the following (in thousands): | |||||||
March 29, | December 28, | ||||||
2014 | 2013 | ||||||
Gift card/certificate liability | $ | 94,779 | 139,721 | ||||
Gift card breakage liability | 13,249 | 14,093 | |||||
Accrued salary and benefits | 10,175 | 26,713 | |||||
Accrued legal liabilities (see note 10(c)) | 26,267 | 26,633 | |||||
Accrued interest | 6,982 | 9,999 | |||||
Accrued professional costs | 3,291 | 2,938 | |||||
Other | 22,147 | 28,821 | |||||
Total other current liabilities | $ | 176,890 | 248,918 | ||||
The decrease in the gift card/certificate liability is driven primarily by the seasonality of our gift card program. The decrease in accrued salary and benefits is primarily due to bonus payments made during the three months ended March 29, 2014 related to fiscal year 2013. |
Segment_Information
Segment Information | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Segment Reporting [Abstract] | ' | ||||||
Segment Information | ' | ||||||
Segment Information | |||||||
The Company is strategically aligned into two global brands, Dunkin’ Donuts and Baskin-Robbins, which are further segregated between U.S. operations and international operations. As such, the Company has determined that it has four operating segments, which are its reportable segments: Dunkin’ Donuts U.S., Dunkin’ Donuts International, Baskin-Robbins U.S., and Baskin-Robbins International. Dunkin’ Donuts U.S., Baskin-Robbins U.S., and Dunkin’ Donuts International primarily derive their revenues through royalty income, franchise fees, and rental income. Dunkin’ Donuts U.S. also derives revenue through retail sales at company-owned restaurants. Baskin-Robbins U.S. also derives revenue through license fees from a third-party license agreement. Baskin-Robbins International primarily derives its revenues from the sales of ice cream products, as well as royalty income, franchise fees, and license fees. The operating results of each segment are regularly reviewed and evaluated separately by the Company’s senior management, which includes, but is not limited to, the chief executive officer. Senior management primarily evaluates the performance of its segments and allocates resources to them based on operating income adjusted for amortization of intangible assets, long-lived asset impairment charges, and other infrequent or unusual charges, and does not reflect the allocation of any corporate charges. This profitability measure is referred to as segment profit. When senior management reviews a balance sheet, it is at a consolidated level. The accounting policies applicable to each segment are consistent with those used in the consolidated financial statements. | |||||||
Prior to fiscal year 2014, the segment profit measure used by the Company to assess the performance of and allocate resources to each reportable segment was based on earnings before interest, taxes, depreciation, amortization, impairment charges, loss on debt extinguishment and refinancing transactions, and other gains and losses, and did not reflect the allocation of any corporate charges. Accordingly, the primary change from the historical segment profit measure is the inclusion of depreciation expense. Beginning in fiscal year 2014, the segment profit measure was revised to the adjusted operating income measure described above to better align the segments with our consolidated performance measures and incentive targets. The segment profit amounts presented below for the three months ended March 30, 2013 have been adjusted to reflect this change to the measurement of segment profit to ensure comparability. | |||||||
Revenues for all operating segments include only transactions with unaffiliated customers and include no intersegment revenues. Revenues reported as “Other” include revenue earned through arrangements with third parties in which our brand names are used and revenue generated from online training programs for franchisees that are not allocated to a specific segment. Revenues by segment were as follows (in thousands): | |||||||
Revenues | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Dunkin’ Donuts U.S. | $ | 125,219 | 119,634 | ||||
Dunkin’ Donuts International | 4,285 | 4,623 | |||||
Baskin-Robbins U.S. | 9,121 | 9,612 | |||||
Baskin-Robbins International | 30,011 | 25,428 | |||||
Total reportable segment revenues | 168,636 | 159,297 | |||||
Other | 3,312 | 2,561 | |||||
Total revenues | $ | 171,948 | 161,858 | ||||
Expenses included in “Corporate” in the segment profit table below include corporate overhead costs, such as payroll and related benefit costs and professional services. Adjusted operating income by segment was as follows (in thousands): | |||||||
Segment profit | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Dunkin’ Donuts U.S. | $ | 89,832 | 83,555 | ||||
Dunkin’ Donuts International | 2,857 | 2,552 | |||||
Baskin-Robbins U.S. | 4,868 | 5,593 | |||||
Baskin-Robbins International | 9,499 | 9,298 | |||||
Total reportable segments | 107,056 | 100,998 | |||||
Corporate | (31,431 | ) | (30,312 | ) | |||
Interest expense, net | (17,872 | ) | (20,718 | ) | |||
Amortization of other intangible assets | (6,405 | ) | (6,582 | ) | |||
Long-lived asset impairment charges | (123 | ) | (248 | ) | |||
Loss on debt extinguishment and refinancing transactions | (13,735 | ) | (5,018 | ) | |||
Other gains (losses), net | 27 | (390 | ) | ||||
Other | — | (397 | ) | ||||
Income before income taxes | $ | 37,517 | 37,333 | ||||
Net income (loss) of equity method investments is included in segment profit for the Dunkin’ Donuts International and Baskin-Robbins International reportable segments. Income included in “Other” in the segment profit table below represents the reduction of depreciation and amortization expense reported by BR Korea Co., Ltd. (“BR Korea”) as the Company recorded an impairment charge in fiscal year 2011 related to the underlying long-lived assets of BR Korea. Net income (loss) of equity method investments by reportable segment was as follows (in thousands): | |||||||
Net income (loss) of equity method investments | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Dunkin’ Donuts International | $ | 304 | (114 | ) | |||
Baskin-Robbins International | 2,458 | 2,538 | |||||
Total reportable segments | 2,762 | 2,424 | |||||
Other | 338 | 663 | |||||
Total net income of equity method investments | $ | 3,100 | 3,087 | ||||
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | |||||||||||||||
Mar. 29, 2014 | ||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | |||||||||||||||
Stockholders' Equity | ' | |||||||||||||||
Stockholders’ Equity and Redeemable Noncontrolling Interests | ||||||||||||||||
The changes in total stockholders' equity and redeemable noncontrolling interests were as follows (in thousands): | ||||||||||||||||
Total stockholders’ equity | Redeemable noncontrolling interests | |||||||||||||||
Balance at December 28, 2013 | $ | 407,358 | 4,930 | |||||||||||||
Net income | 22,956 | (128 | ) | |||||||||||||
Other comprehensive income | 1,248 | — | ||||||||||||||
Dividends paid on common stock | (24,520 | ) | — | |||||||||||||
Exercise of stock options | 3,411 | — | ||||||||||||||
Repurchases of common stock | (23,998 | ) | — | |||||||||||||
Share-based compensation expense | 1,849 | — | ||||||||||||||
Excess tax benefits from share-based compensation | 5,465 | — | ||||||||||||||
Other, net | (468 | ) | — | |||||||||||||
Balance at March 29, 2014 | $ | 393,301 | 4,802 | |||||||||||||
(a) Redeemable Noncontrolling Interests | ||||||||||||||||
As of March 29, 2014, the consolidated balance sheets included $2.5 million of cash and cash equivalents and $6.6 million of property and equipment, net, for the partnership entity with the noncontrolling owners, which may be used only to settle obligations of the partnership. | ||||||||||||||||
(b) Treasury Stock | ||||||||||||||||
During the three months ended March 29, 2014, the Company repurchased a total of 512,205 shares of common stock at a weighted average price per share of $46.84 from existing stockholders. The Company accounts for treasury stock under the cost method, and as such recorded an increase in common treasury stock of $24.0 million during the three months ended March 29, 2014, based on the fair market value of the shares on the date of repurchase and direct costs incurred. As of March 29, 2014, $2.0 million remained unpaid related to the repurchase of common stock, which was included in other current liabilities in the consolidated balance sheets. | ||||||||||||||||
(c) Equity Incentive Plans | ||||||||||||||||
During the three months ended March 29, 2014, the Company granted options to purchase 1,406,308 shares of common stock, 59,080 restricted stock units (“RSUs”), and 27,096 restricted stock awards (“RSAs”) to certain employees. The stock options generally vest in equal annual amounts over an approximately four-year period subsequent to the grant date, and have a maximum contractual term of seven years. The stock options were granted with an exercise price of $51.67 per share and have a weighted average grant-date fair value of $10.65 per share. The RSUs vest over a three-year period subsequent to the grant date, and have a grant-date fair value of $51.67 per share. The RSAs vest in full on July 31, 2016, and have a grant-date fair value of $51.67 per share. | ||||||||||||||||
In addition, the Company granted 150,000 performance-based RSAs during the three months ended March 29, 2014. These performance-based RSAs are eligible to vest on December 31, 2018, subject to a market vesting condition linked to the level of total shareholder return received by the Company's shareholders during the performance period measured against the median total shareholder return of the companies in the S&P 500 Composite Index. The performance-based RSAs were valued based on a Monte Carlo simulation model to reflect the impact of the total shareholder return market condition, resulting in a grant-date fair value of $37.94 per share. | ||||||||||||||||
Total compensation expense related to all share-based awards was $1.8 million and $1.6 million for the three months ended March 29, 2014 and March 30, 2013, respectively, and is included in general and administrative expenses, net in the consolidated statements of operations. | ||||||||||||||||
(d) Accumulated Other Comprehensive Income | ||||||||||||||||
The changes in the components of accumulated other comprehensive income were as follows (in thousands): | ||||||||||||||||
Effect of foreign | Unrealized gains (losses) on interest rate swaps | Unrealized gain (loss) on pension plan | Other | Accumulated | ||||||||||||
currency | other | |||||||||||||||
translation | comprehensive | |||||||||||||||
income | ||||||||||||||||
Balance at December 28, 2013 | $ | 5 | 6,085 | (3,098 | ) | (1,653 | ) | 1,339 | ||||||||
Other comprehensive income (loss) | 1,291 | (701 | ) | 16 | 642 | 1,248 | ||||||||||
Balance at March 29, 2014 | $ | 1,296 | 5,384 | (3,082 | ) | (1,011 | ) | 2,587 | ||||||||
(e) Dividends | ||||||||||||||||
The Company paid quarterly dividends of $0.23 per share of common stock on March 19, 2014, totaling approximately $24.5 million. On April 24, 2014, we announced that our board of directors approved the next quarterly dividend of $0.23 per share of common stock payable June 4, 2014 to shareholders of record as of the close of business on May 27, 2014. |
Earnings_per_Share
Earnings per Share | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Earnings Per Share [Abstract] | ' | ||||||
Earnings per Share | ' | ||||||
Earnings per Share | |||||||
The computation of basic and diluted earnings per common share is as follows (in thousands, except share and per share amounts): | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Net income attributable to Dunkin’ Brands—basic and diluted | $ | 22,956 | 23,798 | ||||
Weighted average number of common shares: | |||||||
Common—basic | 106,501,856 | 106,246,438 | |||||
Common—diluted | 107,980,160 | 108,158,977 | |||||
Earnings per common share: | |||||||
Common—basic | $ | 0.22 | 0.22 | ||||
Common—diluted | 0.21 | 0.22 | |||||
The weighted average number of common shares in the common diluted earnings per share calculation includes the dilutive effect of 1,478,304 and 1,912,539 equity awards for the three months ended March 29, 2014 and March 30, 2013, respectively, using the treasury stock method. The weighted average number of common shares in the common diluted earnings per share calculation for all periods excludes all performance-based equity awards outstanding for which the performance criteria were not yet met as of the fiscal period end. As of March 29, 2014, there were 150,000 restricted shares that were performance-based and for which the performance criteria were not yet met. As of March 30, 2013, there were no stock-based compensation awards that were performance-based and for which the performance criteria was not yet met. Additionally, the weighted average number of common shares in the common diluted earnings per share calculation excludes 1,496,216 and 1,177,999 equity awards for the three months ended March 29, 2014 and March 30, 2013, respectively, as they would be antidilutive. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 29, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Commitments and Contingencies | |
(a) Guarantees | |
Financial Guarantees | |
The Company has established agreements with certain financial institutions whereby the Company’s franchisees can obtain financing with terms of approximately 3 to 10 years for various business purposes. Substantially all loan proceeds are used by the franchisees to finance store improvements, new store development, new central production locations, equipment purchases, related business acquisition costs, working capital, and other costs. In limited instances, the Company guarantees a portion of the payments and commitments of the franchisees, which is collateralized by the store equipment owned by the franchisee. Under the terms of the agreements, in the event that all outstanding borrowings come due simultaneously, the Company would be contingently liable for $3.4 million and $3.0 million at March 29, 2014 and December 28, 2013, respectively. At March 29, 2014 and December 28, 2013, there were no amounts under such guarantees that were due. | |
Supply Chain Guarantees | |
In 2012, the Company entered into a third-party guarantee with a distribution facility of franchisee products that guarantees franchisees would sell a certain volume of cooler beverages each year over a 4-year period. During the second quarter of fiscal year 2013, the Company determined that the franchisees will not achieve the required sales volume, and therefore, the Company accrued the maximum guarantee under the agreement of $7.5 million, which is included in other current liabilities in the consolidated balance sheets as of December 28, 2013. The Company made the full required guarantee payment during the three months ended March 29, 2014. No additional guarantee payments will be required under the agreement. | |
The Company entered into a third-party guarantee with a distribution facility that guarantees franchisees will purchase a certain volume of product over a 10-year period. As product is purchased by the Company’s franchisees over the term of the agreement, the amount of the guarantee is reduced. As of March 29, 2014 and December 28, 2013, the Company was contingently liable for $5.4 million and $5.7 million, respectively, under this guarantee. Additionally, the Company has various supply chain contracts that generally provide for purchase commitments or exclusivity, the majority of which result in the Company being contingently liable upon early termination of the agreement or engaging with another supplier. As of March 29, 2014 and December 28, 2013, the Company was contingently liable under such supply chain agreements for approximately $51.3 million and $52.6 million, respectively. The Company assesses the risk of performing under each of these guarantees on a quarterly basis, and, based on various factors including internal forecasts, prior history, and ability to extend contract terms, we have not recorded any liabilities related to these commitments, except for the liability recorded in connection with the cooler beverage commitment discussed above. | |
Lease Guarantees | |
As a result of assigning our interest in obligations under property leases as a condition of the refranchising of certain restaurants and the guarantee of certain other leases, we are contingently liable on certain lease agreements. These leases have varying terms, the latest of which expires in 2024. As of March 29, 2014 and December 28, 2013, the potential amount of undiscounted payments the Company could be required to make in the event of nonpayment by the primary lessee was $6.1 million and $6.4 million, respectively. Our franchisees are the primary lessees under the majority of these leases. The Company generally has cross-default provisions with these franchisees that would put them in default of their franchise agreement in the event of nonpayment under the lease. We believe these cross-default provisions significantly reduce the risk that we will be required to make payments under these leases. Accordingly, we do not believe it is probable that the Company will be required to make payments under such leases, and we have not recorded a liability for such contingent liabilities. | |
(b) Letters of Credit | |
At March 29, 2014 and December 28, 2013, the Company had standby letters of credit outstanding for a total of $2.6 million and $3.0 million, respectively. There were no amounts drawn down on these letters of credit. | |
(c) Legal Matters | |
In May 2003, a group of Dunkin’ Donuts franchisees from Quebec, Canada filed a lawsuit against the Company on a variety of claims, based on events which primarily occurred 10 to 15 years ago, including but not limited to, alleging that the Company breached its franchise agreements and provided inadequate management and support to Dunkin’ Donuts franchisees in Quebec (the “Bertico litigation”). On June 22, 2012, the Quebec Superior Court found for the plaintiffs and issued a judgment against the Company in the amount of approximately C$16.4 million (approximately $15.9 million), plus costs and interest, representing loss in value of the franchises and lost profits. During the second quarter of 2012, the Company increased its estimated liability related to the Bertico litigation by $20.7 million to reflect the judgment amount and estimated plaintiff legal costs and interest. During the three months ended March 29, 2014 and March 30, 2013, the Company accrued additional interest on the judgment amount of $222 thousand and $243 thousand, respectively, resulting in an estimated liability of $24.5 million, including the impact of foreign exchange, as of March 29, 2014. The Company strongly disagrees with the decision reached by the Court and believes the damages awarded were unwarranted. As such, the Company is vigorously appealing the decision. | |
The Company is engaged in several matters of litigation arising in the ordinary course of its business as a franchisor. Such matters include disputes related to compliance with the terms of franchise and development agreements, including claims or threats of claims of breach of contract, negligence, and other alleged violations by the Company. At March 29, 2014 and December 28, 2013, contingent liabilities, excluding the Bertico litigation, totaling $1.8 million and $1.5 million, were included in other current liabilities in the consolidated balance sheets to reflect the Company’s estimate of the potential loss which may be incurred in connection with these matters. While the Company intends to vigorously defend its positions against all claims in these lawsuits and disputes, it is reasonably possible that the losses in connection with all matters could increase by up to an additional $12.0 million based on the outcome of ongoing litigation or negotiations. | |
(d) Line of Credit to Distribution Facility | |
In May 2013, the Company provided a secured revolving line of credit to a distribution facility of franchisee products for an aggregate maximum principal amount of up to $8.0 million plus interest. The entire principal balance and accrued and unpaid interest is due June 1, 2014. The purpose of this line of credit is to provide funding for the purchase and storage of certain inventory, which was pledged as collateral under a security agreement entered into in connection with the line of credit agreement. Through March 29, 2014, no amounts have been drawn on this line of credit. |
RelatedParty_Transactions
Related-Party Transactions | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Related Party Transactions [Abstract] | ' | ||||||
Related-Party Transactions | ' | ||||||
Related-Party Transactions | |||||||
(a) Advertising Funds | |||||||
At March 29, 2014 and December 28, 2013, the Company had a net payable of $14.6 million and $17.6 million, respectively, to the various advertising funds. | |||||||
To cover administrative expenses of the advertising funds, the Company charges each advertising fund a management fee for items such as facilities, accounting services, information technology, data processing, product development, legal, administrative support services, and other operating expenses, as well as share-based compensation expense for employees that provide services directly to the advertising funds. Management fees totaled $1.9 million and $1.5 million for the three months ended March 29, 2014 and March 30, 2013, respectively, and are reflected in the consolidated statements of operations as a reduction in general and administrative expenses, net. | |||||||
The Company made discretionary contributions to certain advertising funds for the purpose of supplementing national and regional advertising in certain markets of $1.0 million during the three months ended March 30, 2013, which are included in general and administrative expenses, net in the consolidated statements of operations. No such contributions were made during three months ended March 29, 2014. Additionally, the Company made net contributions to the advertising funds based on retail sales as owner and operator of company-owned restaurants of $264 thousand and $236 thousand during the three months ended March 29, 2014 and March 30, 2013, respectively, which are included in company-owned restaurant expenses in the consolidated statements of operations. During the three months ended March 29, 2014, the Company also funded initiatives that benefit the gift card program totaling $1.7 million, which were recorded as reductions to the gift card breakage liability included within other current liabilities in the consolidated balance sheets. | |||||||
(b) Equity Method Investments | |||||||
The Company recognized royalty income from its equity method investees as follows (in thousands): | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
B-R 31 Ice Cream Co., Ltd. | $ | 311 | 402 | ||||
BR Korea Co., Ltd. | 1,047 | 1,010 | |||||
Coffee Alliance, S.L. (“Coffee Alliance”) | — | 98 | |||||
$ | 1,358 | 1,510 | |||||
At March 29, 2014 and December 28, 2013, the Company had $983 thousand and $1.4 million, respectively of royalties receivable from its equity method investees, which were recorded in accounts receivable, net of allowance for doubtful accounts, in the consolidated balance sheets. | |||||||
The Company made net payments to its joint ventures totaling approximately $495 thousand and $1.0 million during the three months ended March 29, 2014 and March 30, 2013, respectively, primarily for the purchase of ice cream products and incentive payments. | |||||||
During the three months ended March 30, 2013, the Company made additional loans of $662 thousand to our Spain joint venture, Coffee Alliance. As of March 29, 2014 and December 28, 2013, the Company had $2.7 million of notes receivable from Coffee Alliance, which were fully reserved by the Company in the third quarter of fiscal year 2013. | |||||||
During the three months ended March 29, 2014, the Company recognized sales of ice cream products of $1.1 million in the consolidated statements of operations from the sale of ice cream products to Palm Oasis Ventures Pty. Ltd. (“Australia JV”), of which the Company owns a 20 percent equity interest. As of March 29, 2014 and December 28, 2013, the Company had $726 thousand and $733 thousand, respectively, of net receivables from the Australia JV, consisting of accounts receivable and notes and other receivables, net of other current liabilities. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | ||||||||||||||||||
Mar. 29, 2014 | |||||||||||||||||||
Disclosure Summary Of Significant Accounting Policies Additional Information [Abstract] | ' | ||||||||||||||||||
Unaudited Financial Statements | ' | ||||||||||||||||||
Unaudited Consolidated Financial Statements | |||||||||||||||||||
The consolidated balance sheet as of March 29, 2014, the consolidated statements of operations, comprehensive income, and cash flows for the three months ended March 29, 2014 and March 30, 2013, are unaudited. | |||||||||||||||||||
The accompanying unaudited consolidated financial statements include the accounts of DBGI and its consolidated subsidiaries and have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements. All significant transactions and balances between subsidiaries and affiliates have been eliminated in consolidation. In the opinion of management, all adjustments necessary for a fair presentation of such financial statements in accordance with U.S. GAAP have been recorded. Such adjustments consisted only of normal recurring items. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended December 28, 2013, included in the Company’s Annual Report on Form 10-K. | |||||||||||||||||||
Fiscal Year | ' | ||||||||||||||||||
Fiscal Year | |||||||||||||||||||
The Company operates and reports financial information on a 52- or 53-week year on a 13-week quarter basis with the fiscal year ending on the last Saturday in December and fiscal quarters ending on the 13th Saturday of each quarter (or 14th Saturday when applicable with respect to the fourth fiscal quarter). The data periods contained within our three month periods ended March 29, 2014 and March 30, 2013 reflect the results of operations for the 13-week periods ended on those dates. Operating results for the three months ended March 29, 2014 is not necessarily indicative of the results that may be expected for the fiscal year ending December 27, 2014. | |||||||||||||||||||
Fair Value of Financial Instruments | ' | ||||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||||
Financial assets and liabilities are categorized, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to the quoted prices in active markets for identical assets and liabilities and lowest priority to unobservable inputs. Observable market data, when available, is required to be used in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. | |||||||||||||||||||
Financial assets and liabilities measured at fair value on a recurring basis as of March 29, 2014 and December 28, 2013 are summarized as follows (in thousands): | |||||||||||||||||||
29-Mar-14 | 28-Dec-13 | ||||||||||||||||||
Quoted prices | Significant | Total | Quoted prices | Significant | Total | ||||||||||||||
in active | other | in active | other | ||||||||||||||||
markets for | observable | markets for | observable | ||||||||||||||||
identical assets | inputs | identical assets | inputs | ||||||||||||||||
(Level 1) | (Level 2) | (Level 1) | (Level 2) | ||||||||||||||||
Assets: | |||||||||||||||||||
Mutual funds | $ | 649 | — | 649 | 1,012 | — | 1,012 | ||||||||||||
Interest rate swaps | — | 9,155 | 9,155 | — | 10,221 | 10,221 | |||||||||||||
Total assets | $ | 649 | 9,155 | 9,804 | 1,012 | 10,221 | 11,233 | ||||||||||||
Liabilities: | |||||||||||||||||||
Deferred compensation liabilities | $ | — | 7,555 | 7,555 | — | 7,181 | 7,181 | ||||||||||||
Total liabilities | $ | — | 7,555 | 7,555 | — | 7,181 | 7,181 | ||||||||||||
The deferred compensation liabilities primarily relate to the Dunkin’ Brands, Inc. Non-Qualified Deferred Compensation Plan (“NQDC Plan”), which allows for pre-tax salary deferrals for certain qualifying employees. Changes in the fair value of the deferred compensation liabilities are derived using quoted prices in active markets of the asset selections made by the participants. The deferred compensation liabilities are classified within Level 2, as defined under U.S. GAAP, because their inputs are derived principally from observable market data by correlation to hypothetical investments. The Company holds mutual funds, as well as money market funds, to partially offset the Company’s liabilities under certain benefit plans. The changes in the fair value of the mutual funds are derived using quoted prices in active markets for the specific funds. As such, the mutual funds are classified within Level 1, as defined under U.S. GAAP. | |||||||||||||||||||
The Company uses readily available market data to value its interest rate swaps, such as interest rate curves and discount factors. Additionally, the fair value of derivatives includes consideration of credit risk in the valuation. The Company uses a potential future exposure model to estimate this credit valuation adjustment (“CVA”). The inputs to the CVA are largely based on observable market data, with the exception of certain assumptions regarding credit worthiness which make the CVA a Level 3 input, as defined under U.S. GAAP. As the magnitude of the CVA is not a significant component of the fair value of the interest rate swaps as of March 29, 2014, it is not considered a significant input and the derivatives are classified as Level 2. | |||||||||||||||||||
The carrying value and estimated fair value of long-term debt as of March 29, 2014 and December 28, 2013 were as follows (in thousands): | |||||||||||||||||||
29-Mar-14 | 28-Dec-13 | ||||||||||||||||||
Carrying Value | Estimated fair value | Carrying Value | Estimated fair value | ||||||||||||||||
Financial liabilities | |||||||||||||||||||
Term loans | $ | 1,813,245 | 1,816,414 | 1,823,609 | 1,836,212 | ||||||||||||||
The estimated fair value of our term loans is estimated based on current bid prices for our term loans. Judgment is required to develop these estimates. As such, our term loans are classified within Level 2, as defined under U.S. GAAP. | |||||||||||||||||||
Derivative Instruments and Hedging Activities | ' | ||||||||||||||||||
Derivative Instruments and Hedging Activities | |||||||||||||||||||
The Company uses derivative instruments to hedge interest rate risks. These derivative contracts are entered into with financial institutions. The Company does not use derivative instruments for trading purposes and we have procedures in place to monitor and control their use. | |||||||||||||||||||
We record all derivative instruments on our consolidated balance sheets at fair value. For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative instruments is reported as a component of other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Any ineffective portion of the gain or loss on the derivative instrument for a cash flow hedge is recorded in the consolidated statements of operations immediately. Cash flows associated with the Company's interest rate swap agreements are classified as cash flows from operating activities in the consolidated statements of cash flows which is consistent with the classification of cash flows of the underlying hedged item. See note 5 for a discussion of the Company's use of derivative instruments, management of credit risk inherent in derivative instruments, and fair value information. | |||||||||||||||||||
Concentration of Credit Risk | ' | ||||||||||||||||||
Concentration of Credit Risk | |||||||||||||||||||
The Company is subject to credit risk through its accounts receivable consisting primarily of amounts due from franchisees and licensees for franchise fees, royalty income, and sales of ice cream products. In addition, we have note and lease receivables from certain of our franchisees and licensees. The financial condition of these franchisees and licensees is largely dependent upon the underlying business trends of our brands and market conditions within the quick service restaurant industry. This concentration of credit risk is mitigated, in part, by the large number of franchisees and licensees of each brand and the short-term nature of the franchise and license fee and lease receivables. At March 29, 2014 and December 28, 2013, one master licensee, including its majority-owned subsidiaries, accounted for approximately 27% and 17%, respectively, of total accounts and notes receivable, which was primarily due to the timing of orders and shipments of ice cream to the master licensee. For the three months ended March 29, 2014, one master licensee, including its majority-owned subsidiaries, accounted for approximately 11% of total revenues. No individual franchisee or master licensee accounted for more than 10% of total revenues for the three months ended March 30, 2013. | |||||||||||||||||||
Recent Accounting Pronouncements | ' | ||||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||||
In July 2013, the Financial Accounting Standards Board (“FASB”) issued new guidance which requires presentation of an unrecognized tax benefit as a reduction of a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except in certain circumstances. This guidance was adopted by the Company in fiscal year 2014. The adoption of this guidance did not have any impact on the Company’s consolidated financial statements. | |||||||||||||||||||
Reclassifications | ' | ||||||||||||||||||
Reclassifications | |||||||||||||||||||
The Company has revised the presentation of certain income generating transactions that historically were recorded within general and administrative expenses, net in the consolidated statements of operations. Income from these transactions totaling $1.2 million have been reclassified into other operating income, net, for the three months ended March 30, 2013 in the consolidated statements of operations to conform to the current year presentation. There is no impact to total revenues, operating income, income before income taxes, or net income as a result of these reclassifications. | |||||||||||||||||||
The Company has also revised the presentation of certain asset captions within the consolidated balance sheets to conform to the current period presentation, including combining 'assets held for sale' with 'prepaid expense and other current assets' and combining 'restricted cash' with 'other assets'. The revisions had no impact on total current assets or total assets. | |||||||||||||||||||
Additionally, the Company has revised the presentation of certain captions for the three months ended March 30, 2013 within the consolidated statements of cash flows to conform to the current period presentation. The revisions had no impact on net cash used in operating, investing, or financing activities. | |||||||||||||||||||
Subsequent Events | ' | ||||||||||||||||||
Subsequent Events | |||||||||||||||||||
Subsequent events have been evaluated through the date these consolidated financial statements were filed. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 3 Months Ended | ||||||||||||||||||
Mar. 29, 2014 | |||||||||||||||||||
Disclosure Summary Of Significant Accounting Policies Additional Information [Abstract] | ' | ||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | ' | ||||||||||||||||||
Financial assets and liabilities measured at fair value on a recurring basis as of March 29, 2014 and December 28, 2013 are summarized as follows (in thousands): | |||||||||||||||||||
29-Mar-14 | 28-Dec-13 | ||||||||||||||||||
Quoted prices | Significant | Total | Quoted prices | Significant | Total | ||||||||||||||
in active | other | in active | other | ||||||||||||||||
markets for | observable | markets for | observable | ||||||||||||||||
identical assets | inputs | identical assets | inputs | ||||||||||||||||
(Level 1) | (Level 2) | (Level 1) | (Level 2) | ||||||||||||||||
Assets: | |||||||||||||||||||
Mutual funds | $ | 649 | — | 649 | 1,012 | — | 1,012 | ||||||||||||
Interest rate swaps | — | 9,155 | 9,155 | — | 10,221 | 10,221 | |||||||||||||
Total assets | $ | 649 | 9,155 | 9,804 | 1,012 | 10,221 | 11,233 | ||||||||||||
Liabilities: | |||||||||||||||||||
Deferred compensation liabilities | $ | — | 7,555 | 7,555 | — | 7,181 | 7,181 | ||||||||||||
Total liabilities | $ | — | 7,555 | 7,555 | — | 7,181 | 7,181 | ||||||||||||
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | ' | ||||||||||||||||||
The carrying value and estimated fair value of long-term debt as of March 29, 2014 and December 28, 2013 were as follows (in thousands): | |||||||||||||||||||
29-Mar-14 | 28-Dec-13 | ||||||||||||||||||
Carrying Value | Estimated fair value | Carrying Value | Estimated fair value | ||||||||||||||||
Financial liabilities | |||||||||||||||||||
Term loans | $ | 1,813,245 | 1,816,414 | 1,823,609 | 1,836,212 | ||||||||||||||
Franchise_Fees_and_Royalty_Inc1
Franchise Fees and Royalty Income (Tables) | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Disclosure Franchise Fees And Royalty Income [Abstract] | ' | ||||||
Schedule Of Franchise Revenue Table | ' | ||||||
Franchise fees and royalty income consisted of the following (in thousands): | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Royalty income | $ | 98,599 | 93,222 | ||||
Initial franchise fees and renewal income | 8,113 | 10,543 | |||||
Total franchise fees and royalty income | $ | 106,712 | 103,765 | ||||
Changes in Franchised and Company-Owned Points of Distribution | ' | ||||||
The changes in franchised and company-owned points of distribution were as follows: | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Systemwide Points of Distribution: | |||||||
Franchised points of distribution—beginning of period | 18,122 | 17,333 | |||||
Franchised points of distribution—opened | 266 | 244 | |||||
Franchised points of distribution—closed | (170 | ) | (131 | ) | |||
Franchised points of distribution in operation—end of period | 18,218 | 17,446 | |||||
Company-owned points of distribution—end of period | 36 | 30 | |||||
Total systemwide points of distribution—end of period | 18,254 | 17,476 | |||||
Derivative_Instruments_and_Hed1
Derivative Instruments and Hedging Transactions (Tables) | 3 Months Ended | |||||||||||||
Mar. 29, 2014 | ||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | ' | |||||||||||||
The fair values of derivatives instruments consisted of the following (in thousands): | ||||||||||||||
March 29, | December 28, | Consolidated Balance Sheet Classification | ||||||||||||
2014 | 2013 | |||||||||||||
Interest rate swaps - asset | $ | 9,155 | 10,221 | Other assets | ||||||||||
Total fair values of derivative instruments - asset | $ | 9,155 | 10,221 | |||||||||||
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | ' | |||||||||||||
The table below summarizes the effects of derivative instruments on the consolidated statements of operations and comprehensive income (loss) for the three months ended March 29, 2014 (in thousands): | ||||||||||||||
Derivatives designated as cash flow hedging instruments | Amount of gain (loss) recognized in other comprehensive income (loss) | Amount of net gain (loss) reclassified into earnings(1) | Consolidated statement of operations classification | Total effect on other comprehensive income (loss) | ||||||||||
Interest rate swaps | $ | (2,035 | ) | (877 | ) | Interest expense | $ | (1,158 | ) | |||||
Income tax effect | 803 | 346 | Provision for income taxes | 457 | ||||||||||
Net of income taxes | $ | (1,232 | ) | (531 | ) | $ | (701 | ) | ||||||
(1) | The total net gain (loss) reclassified from accumulated other comprehensive income into interest expense in the consolidated statements of operations includes the straight-line amortization of the unrealized gain that remained in accumulated other comprehensive income as of the date of the amendment. | |||||||||||||
The table below summarizes the effects of derivative instruments on the consolidated statements of operations and comprehensive income (loss) for the three months ended March 30, 2013 (in thousands): | ||||||||||||||
Derivatives designated as cash flow hedging instruments | Amount of gain (loss) recognized in other comprehensive income (loss) | Amount of net gain (loss) reclassified into earnings | Consolidated statement of operations classification | Total effect on other comprehensive income (loss) | ||||||||||
Interest rate swaps | $ | 495 | (846 | ) | Interest expense | $ | 1,341 | |||||||
Income tax effect | (207 | ) | 355 | Provision for income taxes | (562 | ) | ||||||||
Net of income taxes | $ | 288 | (491 | ) | $ | 779 | ||||||||
Other_Current_Liabilities_Tabl
Other Current Liabilities (Tables) | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Other Liabilities, Current [Abstract] | ' | ||||||
Other Current Liabilities | ' | ||||||
Other current liabilities consisted of the following (in thousands): | |||||||
March 29, | December 28, | ||||||
2014 | 2013 | ||||||
Gift card/certificate liability | $ | 94,779 | 139,721 | ||||
Gift card breakage liability | 13,249 | 14,093 | |||||
Accrued salary and benefits | 10,175 | 26,713 | |||||
Accrued legal liabilities (see note 10(c)) | 26,267 | 26,633 | |||||
Accrued interest | 6,982 | 9,999 | |||||
Accrued professional costs | 3,291 | 2,938 | |||||
Other | 22,147 | 28,821 | |||||
Total other current liabilities | $ | 176,890 | 248,918 | ||||
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Segment Reporting [Abstract] | ' | ||||||
Revenues by Segment | ' | ||||||
Revenues by segment were as follows (in thousands): | |||||||
Revenues | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Dunkin’ Donuts U.S. | $ | 125,219 | 119,634 | ||||
Dunkin’ Donuts International | 4,285 | 4,623 | |||||
Baskin-Robbins U.S. | 9,121 | 9,612 | |||||
Baskin-Robbins International | 30,011 | 25,428 | |||||
Total reportable segment revenues | 168,636 | 159,297 | |||||
Other | 3,312 | 2,561 | |||||
Total revenues | $ | 171,948 | 161,858 | ||||
Segment Profit by Segment | ' | ||||||
Expenses included in “Corporate” in the segment profit table below include corporate overhead costs, such as payroll and related benefit costs and professional services. Adjusted operating income by segment was as follows (in thousands): | |||||||
Segment profit | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Dunkin’ Donuts U.S. | $ | 89,832 | 83,555 | ||||
Dunkin’ Donuts International | 2,857 | 2,552 | |||||
Baskin-Robbins U.S. | 4,868 | 5,593 | |||||
Baskin-Robbins International | 9,499 | 9,298 | |||||
Total reportable segments | 107,056 | 100,998 | |||||
Corporate | (31,431 | ) | (30,312 | ) | |||
Interest expense, net | (17,872 | ) | (20,718 | ) | |||
Amortization of other intangible assets | (6,405 | ) | (6,582 | ) | |||
Long-lived asset impairment charges | (123 | ) | (248 | ) | |||
Loss on debt extinguishment and refinancing transactions | (13,735 | ) | (5,018 | ) | |||
Other gains (losses), net | 27 | (390 | ) | ||||
Other | — | (397 | ) | ||||
Income before income taxes | $ | 37,517 | 37,333 | ||||
Equity in Net Income of Joint Ventures Reportable Segment | ' | ||||||
Net income (loss) of equity method investments by reportable segment was as follows (in thousands): | |||||||
Net income (loss) of equity method investments | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Dunkin’ Donuts International | $ | 304 | (114 | ) | |||
Baskin-Robbins International | 2,458 | 2,538 | |||||
Total reportable segments | 2,762 | 2,424 | |||||
Other | 338 | 663 | |||||
Total net income of equity method investments | $ | 3,100 | 3,087 | ||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | |||||||||||||||
Mar. 29, 2014 | ||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | |||||||||||||||
Schedule of Shareholders' Equity | ' | |||||||||||||||
The changes in total stockholders' equity and redeemable noncontrolling interests were as follows (in thousands): | ||||||||||||||||
Total stockholders’ equity | Redeemable noncontrolling interests | |||||||||||||||
Balance at December 28, 2013 | $ | 407,358 | 4,930 | |||||||||||||
Net income | 22,956 | (128 | ) | |||||||||||||
Other comprehensive income | 1,248 | — | ||||||||||||||
Dividends paid on common stock | (24,520 | ) | — | |||||||||||||
Exercise of stock options | 3,411 | — | ||||||||||||||
Repurchases of common stock | (23,998 | ) | — | |||||||||||||
Share-based compensation expense | 1,849 | — | ||||||||||||||
Excess tax benefits from share-based compensation | 5,465 | — | ||||||||||||||
Other, net | (468 | ) | — | |||||||||||||
Balance at March 29, 2014 | $ | 393,301 | 4,802 | |||||||||||||
Changes in Components of Accumulated Other Comprehensive Income | ' | |||||||||||||||
The changes in the components of accumulated other comprehensive income were as follows (in thousands): | ||||||||||||||||
Effect of foreign | Unrealized gains (losses) on interest rate swaps | Unrealized gain (loss) on pension plan | Other | Accumulated | ||||||||||||
currency | other | |||||||||||||||
translation | comprehensive | |||||||||||||||
income | ||||||||||||||||
Balance at December 28, 2013 | $ | 5 | 6,085 | (3,098 | ) | (1,653 | ) | 1,339 | ||||||||
Other comprehensive income (loss) | 1,291 | (701 | ) | 16 | 642 | 1,248 | ||||||||||
Balance at March 29, 2014 | $ | 1,296 | 5,384 | (3,082 | ) | (1,011 | ) | 2,587 | ||||||||
Earnings_per_Share_Tables
Earnings per Share (Tables) | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Earnings Per Share [Abstract] | ' | ||||||
Computation of Basic and Diluted Earnings Per Common Share | ' | ||||||
The computation of basic and diluted earnings per common share is as follows (in thousands, except share and per share amounts): | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
Net income attributable to Dunkin’ Brands—basic and diluted | $ | 22,956 | 23,798 | ||||
Weighted average number of common shares: | |||||||
Common—basic | 106,501,856 | 106,246,438 | |||||
Common—diluted | 107,980,160 | 108,158,977 | |||||
Earnings per common share: | |||||||
Common—basic | $ | 0.22 | 0.22 | ||||
Common—diluted | 0.21 | 0.22 | |||||
RelatedParty_Transactions_Tabl
Related-Party Transactions (Tables) | 3 Months Ended | ||||||
Mar. 29, 2014 | |||||||
Related Party Transactions [Abstract] | ' | ||||||
Related Party Transactions | ' | ||||||
The Company recognized royalty income from its equity method investees as follows (in thousands): | |||||||
Three months ended | |||||||
March 29, | March 30, | ||||||
2014 | 2013 | ||||||
B-R 31 Ice Cream Co., Ltd. | $ | 311 | 402 | ||||
BR Korea Co., Ltd. | 1,047 | 1,010 | |||||
Coffee Alliance, S.L. (“Coffee Alliance”) | — | 98 | |||||
$ | 1,358 | 1,510 | |||||
Summary_of_Significant_Account3
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 3 Months Ended | ||
Mar. 29, 2014 | Mar. 30, 2013 | Dec. 28, 2013 | |
customer | customer | ||
Summary of Significant Accounting Policies, Narrative [Line Items] | ' | ' | ' |
Financial reporting and operating period, quarter | '91 days | '91 days | ' |
Number of customer that accounted for more than 10% of receivable | 1 | ' | 1 |
Percentage of receivable from one master licensee account | 27.00% | ' | 17.00% |
Income reclassified into operating income | ' | $1,200,000 | ' |
Carrying Value and Estimated Fair Value Of Long Term Debt [Abstract] | ' | ' | ' |
Term loans, Carrying Value | 1,813,245,000 | ' | 1,823,609,000 |
Term loans, Estimated fair value | $1,816,414,000 | ' | $1,836,212,000 |
Minimum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies, Narrative [Line Items] | ' | ' | ' |
Financial reporting and operating period, year | '364 days | ' | ' |
Maximum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies, Narrative [Line Items] | ' | ' | ' |
Financial reporting and operating period, year | '371 days | ' | ' |
Customer Concentration Risk [Member] | Sales [Member] | ' | ' | ' |
Summary of Significant Accounting Policies, Narrative [Line Items] | ' | ' | ' |
Concentration risk, number of customers accounted for 11% | 1 | ' | ' |
Concentration risk, percentage | 11.00% | ' | ' |
Concentration risk, number of customers | ' | 0 | ' |
Financial_Assets_and_Liabiliti
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) (USD $) | Mar. 29, 2014 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | $9,804 | $11,233 |
Liabilities | 7,555 | 7,181 |
Mutual funds | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 649 | 1,012 |
Interest Rate Swap [Member] | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 9,155 | 10,221 |
Deferred compensation liabilities | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Liabilities | 7,555 | 7,181 |
Quoted prices in active markets for identical assets (Level 1) | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 649 | 1,012 |
Liabilities | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) | Mutual funds | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 649 | 1,012 |
Quoted prices in active markets for identical assets (Level 1) | Interest Rate Swap [Member] | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) | Deferred compensation liabilities | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Liabilities | 0 | 0 |
Significant other observable inputs (Level 2) | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 9,155 | 10,221 |
Liabilities | 7,555 | 7,181 |
Significant other observable inputs (Level 2) | Mutual funds | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 0 | 0 |
Significant other observable inputs (Level 2) | Interest Rate Swap [Member] | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Assets | 9,155 | 10,221 |
Significant other observable inputs (Level 2) | Deferred compensation liabilities | ' | ' |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ' | ' |
Liabilities | $7,555 | $7,181 |
Franchise_Fees_and_Royalty_Inc2
Franchise Fees and Royalty Income (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Disclosure Franchise Fees And Royalty Income [Abstract] | ' | ' |
Royalty income | $98,599 | $93,222 |
Initial franchise fees and renewal income | 8,113 | 10,543 |
Total franchise fees and royalty income | $106,712 | $103,765 |
Changes_in_Franchised_and_Comp
Changes in Franchised and Company-Owned Points of Distribution (Detail) | 3 Months Ended | |
Mar. 29, 2014 | Mar. 30, 2013 | |
distributor | distributor | |
Number of Franchises [Roll Forward] | ' | ' |
Franchised points of distribution—beginning of period | 18,122 | 17,333 |
Franchised points of distribution—opened | 266 | 244 |
Franchised points of distribution—closed | -170 | -131 |
Franchised points of distribution in operation—end of period | 18,218 | 17,446 |
Company-owned points of distribution—end of period | 36 | 30 |
Total systemwide points of distribution—end of period | 18,254 | 17,476 |
Franchise_Fees_and_Royalty_Inc3
Franchise Fees and Royalty Income (Narrative) (Details) | 3 Months Ended |
Mar. 30, 2013 | |
Disclosure Changes In Franchised And Company Owned Points Of Distribution [Abstract] | ' |
Reduction in franchised points of distribution in operation | 91 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | ||||||||||||||
Mar. 29, 2014 | Mar. 30, 2013 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Feb. 28, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Feb. 28, 2014 | Mar. 29, 2014 | Feb. 28, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 30, 2013 | Mar. 29, 2014 | Mar. 29, 2014 | |
If DBI’s leverage ratio is greater than 5.50x [Member] | LIBOR [Member] | Federal Fund Rate [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | 2017 Term Loans [Member] | 2017 Term Loans [Member] | 2021 Term Loans [Member] | 2021 Term Loans [Member] | 2021 Term Loans [Member] | Term Loan [Member] | Term Loan [Member] | Senior Amended Credit Facility [Member] | Senior Amended Credit Facility [Member] | Lenders Exiting Term Loan Lending Syndicate [Member] | |||
Base Rate [Member] | LIBOR [Member] | Minimum | Base Rate [Member] | LIBOR [Member] | ||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | ' | ' | ' | $100,000,000 | ' | ' | ' | $450,000,000 | ' | $1,380,000,000 | ' | ' | ' | ' | ' | ' |
Interest rate components | ' | ' | ' | 1.00% | 0.50% | ' | 1.25% | 2.25% | ' | ' | ' | ' | 0.75% | 1.50% | 2.50% | ' | ' | ' |
Debt Instrument Interest Base Rate | 1.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effective interest rate | ' | ' | ' | ' | ' | ' | ' | ' | 2.80% | ' | 3.50% | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Commitment Fee Percentage | 2.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notes reduction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 684,700,000 |
Loss on debt extinguishment and refinancing transactions | 13,735,000 | 5,018,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | 13,700,000 |
Write off of deferred debt issuance cost and discount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,900,000 | ' | 10,500,000 |
Other debt extinguishment and refinancing expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,200,000 |
Debt Instrument, Unamortized Discount Percentage | 0.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.25% | ' | ' |
Debt issuance discount | 4,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,600,000 | ' | ' |
Deferred Finance Costs, Gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,100,000 | 1,200,000 | ' |
Repayment of credit facility per calendar year | ' | ' | ' | ' | ' | ' | ' | ' | 4,500,000 | ' | 13,800,000 | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Voluntary Payment | ' | ' | ' | ' | ' | ' | ' | ' | $5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of excess cash flow required to be used to prepay term loan | 25.00% | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Leverage Ratio Maximum, No Excess Cash Flow Payment | 4.75 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Leverage Ratio Minimum Triggering Event, Fifty Percent Excess Cash Flow Payment Requirement | 5.5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recovered_Sheet1
Derivative instruments and Hedging Transactions (Details) (USD $) | 3 Months Ended | ||||
Mar. 29, 2014 | Mar. 30, 2013 | Mar. 29, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | |
Swap [Member] | Other Current liabilities [Member] | Other Current liabilities [Member] | |||
counterparties | |||||
Derivative [Line Items] | ' | ' | ' | ' | ' |
Derivative, Agreement, Number of Counterparties | ' | ' | 3 | ' | ' |
Derivative, Description of Variable Rate Basis | ' | ' | 'three-month LIBOR | ' | ' |
Derivative variable interest rate spread, floor | ' | ' | 0.75% | ' | ' |
Notional value of swaps | ' | ' | $900,000,000 | ' | ' |
Swap quarterly fixed interest rate | ' | ' | 1.22% | ' | ' |
Total swap interest rate | ' | ' | 3.72% | ' | ' |
Cumulative unrealized gain | ' | ' | 5,800,000 | ' | ' |
Ineffectiveness of interest rate swap | 0 | 0 | ' | ' | ' |
Interest payable | ' | ' | ' | 951,000 | 836,000 |
Estimated reclassification from Accumulated OCI to Income | ' | ' | 4,200,000 | ' | ' |
Derivative termination value | $8,400,000 | ' | ' | ' | ' |
Derivative_Insturments_and_Hed
Derivative Insturments and Hedging Transactions (Details 2) (USD $) | Mar. 29, 2014 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Derivatives, Fair Value [Line Items] | ' | ' |
Total fair values of derivative instruments - asset | $9,155 | $10,221 |
Other Assets [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Interest rate swaps - asset | $9,155 | $10,221 |
Derivative_Instruments_and_Hed2
Derivative Instruments and Hedging Transaction - Derivative Effects (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Derivative [Line Items] | ' | ' |
Interest rate swaps, Total effect on other comprehensive income (loss) | ($1,158) | $1,341 |
Income tax effect, Total effect on other comprehensive income (loss) | 457 | -562 |
Net of income taxes, Amount of gain (loss) recognized in other comprehensive income (loss) | -1,232 | 288 |
Net of income taxes, Amount of net gain (loss) reclassified into earnings | -531 | -491 |
Net of income taxes, Total effect on other comprehensive income (loss) | -701 | 779 |
Interest Expense [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Interest rate swaps, Amount of gain (loss) recognized in other comprehensive income (loss) | -2,035 | 495 |
Interest rate swaps, Amount of net gain (loss) reclassified into earnings | -877 | -846 |
Provision for Income Taxes [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Income tax effect, Amount of gain (loss) recognized in other comprehensive income (loss) | 803 | -207 |
Income tax effect, Amount of net gain (loss) reclassified into earnings | $346 | $355 |
Other_Current_Liabilities_Deta
Other Current Liabilities (Detail) (USD $) | Mar. 29, 2014 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Other Liabilities, Current [Abstract] | ' | ' |
Gift card/certificate liability | $94,779 | $139,721 |
Gift card breakage liability | 13,249 | 14,093 |
Accrued salary and benefits | 10,175 | 26,713 |
Accrued legal liabilities (see note 10(d)) | 26,267 | 26,633 |
Interest Payable, Current | 6,982 | 9,999 |
Accrued professional costs | 3,291 | 2,938 |
Other | 22,147 | 28,821 |
Total other current liabilities | $176,890 | $248,918 |
Revenues_by_Segment_Detail
Revenues by Segment (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Segment Reporting, Revenue Reconciling Item [Line Items] | ' | ' |
Total revenues | $171,948 | $161,858 |
Corporate and Other [Member] | ' | ' |
Segment Reporting, Revenue Reconciling Item [Line Items] | ' | ' |
Total revenues | 3,312 | 2,561 |
Operating Segments | ' | ' |
Segment Reporting, Revenue Reconciling Item [Line Items] | ' | ' |
Total revenues | 168,636 | 159,297 |
Operating Segments | Dunkin' Donuts | United States | ' | ' |
Segment Reporting, Revenue Reconciling Item [Line Items] | ' | ' |
Total revenues | 125,219 | 119,634 |
Operating Segments | Dunkin' Donuts | International | ' | ' |
Segment Reporting, Revenue Reconciling Item [Line Items] | ' | ' |
Total revenues | 4,285 | 4,623 |
Operating Segments | Baskin-Robbins | United States | ' | ' |
Segment Reporting, Revenue Reconciling Item [Line Items] | ' | ' |
Total revenues | 9,121 | 9,612 |
Operating Segments | Baskin-Robbins | International | ' | ' |
Segment Reporting, Revenue Reconciling Item [Line Items] | ' | ' |
Total revenues | $30,011 | $25,428 |
Segment_Profit_by_Segment_Deta
Segment Profit by Segment (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' |
Reportable segment profit | $22,828 | $23,661 |
Corporate | -31,431 | -30,312 |
Interest expense, net | -17,872 | -20,718 |
Amortization of other intangible assets | -6,405 | -6,582 |
Long-lived asset impairment charges | -123 | -248 |
Loss on debt extinguishment and refinancing transactions | -13,735 | -5,018 |
Other gains (losses), net | 27 | -390 |
Other | 0 | -397 |
Income before income taxes | 37,517 | 37,333 |
Operating Segments | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' |
Reportable segment profit | 107,056 | 100,998 |
Operating Segments | Dunkin' Donuts | United States | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' |
Reportable segment profit | 89,832 | 83,555 |
Operating Segments | Dunkin' Donuts | International | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' |
Reportable segment profit | 2,857 | 2,552 |
Operating Segments | Baskin-Robbins | United States | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' |
Reportable segment profit | 4,868 | 5,593 |
Operating Segments | Baskin-Robbins | International | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' |
Reportable segment profit | $9,499 | $9,298 |
Equity_in_Net_Income_of_Joint_
Equity in Net Income of Joint Ventures Reportable Segment (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Segment Reporting Disclosure [Line Items] | ' | ' |
Net income of equity method investments, excluding impairment | $3,100 | $3,087 |
Corporate and Other [Member] | ' | ' |
Segment Reporting Disclosure [Line Items] | ' | ' |
Net income of equity method investments, excluding impairment | 338 | 663 |
Operating Segments | ' | ' |
Segment Reporting Disclosure [Line Items] | ' | ' |
Net income of equity method investments, excluding impairment | 2,762 | 2,424 |
Operating Segments | Dunkin' Donuts | International | ' | ' |
Segment Reporting Disclosure [Line Items] | ' | ' |
Net income of equity method investments, excluding impairment | 304 | -114 |
Operating Segments | Baskin-Robbins | International | ' | ' |
Segment Reporting Disclosure [Line Items] | ' | ' |
Net income of equity method investments, excluding impairment | $2,458 | $2,538 |
Segment_Information_Additional
Segment Information - Additional Information (Detail) | 3 Months Ended |
Mar. 29, 2014 | |
segment | |
Segment Reporting [Abstract] | ' |
Number of reportable segments | 4 |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 0 Months Ended | 3 Months Ended | ||||||||||
Mar. 19, 2014 | Mar. 29, 2014 | Mar. 30, 2013 | Dec. 28, 2013 | Dec. 29, 2012 | Apr. 24, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | |
Subsequent Event [Member] | Performance-based Restricted Shares | 2011 Plan | 2011 Plan | 2011 Plan | 2011 Plan | 2011 Plan | Partnership [Member] | Current Liabilities [Member] | ||||||
Restricted Stock Units (RSUs) | Restricted Stock | Restricted Stock | Employee Stock Option | |||||||||||
Maximum | ||||||||||||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | ' | $202,420,000 | $179,186,000 | $256,933,000 | $252,618,000 | ' | ' | ' | ' | ' | ' | ' | $2,500,000 | ' |
Property and equipment, net | ' | 177,090,000 | ' | 182,858,000 | ' | ' | ' | ' | ' | ' | ' | ' | 6,600,000 | ' |
Treasury stock acquired (in shares) | ' | 512,205 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Treasury stock acquired, weighted average price (in usd per share) | ' | $46.84 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in treasury stock | ' | 23,998,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payments for Repurchase of Common Stock, Remaining Unpaid Amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 |
Options granted | ' | ' | ' | ' | ' | ' | 150,000 | 1,406,308 | ' | ' | ' | ' | ' | ' |
Restricted stock units granted (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 59,080 | 27,096 | ' | ' | ' | ' |
Share-based compensations, vesting period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | '4 years | ' | ' |
Options, maximum contractual term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | ' |
Grant price (in usd per share) | ' | ' | ' | ' | ' | ' | $37.94 | $51.67 | $51.67 | $51.67 | ' | ' | ' | ' |
Options, grant date fair value (in usd per share) | ' | ' | ' | ' | ' | ' | ' | $10.65 | ' | ' | ' | ' | ' | ' |
Compensation expense related to share-based awards | ' | 1,800,000 | 1,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase Decrease In Accumulated Other Comprehensive Income Net | ' | 1,248,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
General and administrative expenses, net | ' | 59,714,000 | 55,577,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend per share of common stock paid (in usd per share) | $0.23 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends paid on common stock | $24,500,000 | $24,520,000 | $20,191,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend per share of common stock declared (in usd per share) | ' | $0.23 | $0.19 | ' | ' | $0.23 | ' | ' | ' | ' | ' | ' | ' | ' |
Changes_in_Total_Shareholders_
Changes in Total Shareholders' Equity (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' |
Balance at December 29, 2012 | $407,358 | ' |
Net income attributable to Dunkin' Brands | 22,956 | 23,798 |
Other comprehensive loss | 1,248 | -10,006 |
Dividends paid on common stock | -24,520 | ' |
Exercise of stock options | 3,411 | ' |
Repurchases of common stock | -23,998 | ' |
Share-based compensation expense | 1,849 | ' |
Excess tax benefits from share-based compensation | 5,465 | 0 |
Other, net | -468 | ' |
Balance at September 28, 2013 | 393,301 | ' |
Redeemable noncontrolling interests [Roll Forward] | ' | ' |
Balance at December 29, 2012 | 4,930 | ' |
Net income | -128 | ' |
Contributions from noncontrolling interests | 0 | ' |
Balance at September 28, 2013 | $4,802 | ' |
Changes_in_Components_of_Accum
Changes in Components of Accumulated Other Comprehensive Income (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 29, 2014 |
Movement in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ' |
Balance at beginning of period | $1,339 |
Current period changes | 1,248 |
Balance at end of period | 2,587 |
Effect of foreign currency translation | ' |
Movement in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ' |
Balance at beginning of period | 5 |
Current period changes | 1,291 |
Balance at end of period | 1,296 |
Unrealized gains (losses) on interest rate swaps | ' |
Movement in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ' |
Balance at beginning of period | 6,085 |
Current period changes | -701 |
Balance at end of period | 5,384 |
Unrealized gain (loss) on pension plan | ' |
Movement in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ' |
Balance at beginning of period | -3,098 |
Current period changes | 16 |
Balance at end of period | -3,082 |
Other | ' |
Movement in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ' |
Balance at beginning of period | -1,653 |
Current period changes | 642 |
Balance at end of period | ($1,011) |
Earnings_Per_Shares_Additional
Earnings Per Shares - Additional Information (Detail) | 3 Months Ended | |
Mar. 29, 2014 | Mar. 30, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Dilutive securities, effect on basic earnings per share, including options and restrictive units | 1,478,304 | 1,912,539 |
Restricted Stock [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Anti-dilutive security excluded from calculation, restricted stock awards (in shares) | 150,000 | 0 |
Stock Options [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 1,496,216 | 1,177,999 |
Computation_of_Basic_and_Dilut
Computation of Basic and Diluted Earnings Per Common Share (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 29, 2014 | Mar. 30, 2013 |
Earnings Per Share [Abstract] | ' | ' |
Net income attributable to Dunkin' Brands-basic and diluted | $22,956 | $23,798 |
Weighted average number of common shares: | ' | ' |
Common-basic (in shares) | 106,501,856 | 106,246,438 |
Common-diluted (in shares) | 107,980,160 | 108,158,977 |
Earnings (loss) per common share: | ' | ' |
Common-basic (in dollars per share) | $0.22 | $0.22 |
Common-diluted (in dollars per share) | $0.21 | $0.22 |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) | Mar. 29, 2014 | Dec. 28, 2013 | Mar. 29, 2014 | Dec. 28, 2013 | Mar. 29, 2014 | Dec. 28, 2013 | Mar. 29, 2014 | Dec. 28, 2013 | Jun. 22, 2012 | Jun. 22, 2012 | Mar. 29, 2014 | Mar. 30, 2013 | Jun. 30, 2012 | Mar. 29, 2014 | Dec. 28, 2013 | Mar. 29, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Mar. 29, 2014 | Mar. 29, 2014 | Mar. 29, 2014 | 17-May-13 |
USD ($) | USD ($) | Other Legal Matter [Member] | Other Legal Matter [Member] | Financial Guarantee [Member] | Financial Guarantee [Member] | Lease Agreements | Lease Agreements | Bertico litigation | Bertico litigation | Bertico litigation | Bertico litigation | Bertico litigation | Supply Commitment | Supply Commitment | Transaction 01 | Transaction 02 | Transaction 02 | Minimum | Maximum | Maximum | Commitments to Extend Credit | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | CAD | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Purchase Commitment | Purchase Commitment | Purchase Commitment | Other Legal Matter [Member] | USD ($) | |||||
USD ($) | USD ($) | USD ($) | USD ($) | |||||||||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Franchisees financing term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | '10 years | ' | ' |
Guarantee obligation, maximum exposure | ' | ' | ' | ' | $3,400,000 | $3,000,000 | $6,100,000 | $6,400,000 | ' | ' | ' | ' | ' | $51,300,000 | $52,600,000 | ' | $5,400,000 | $5,700,000 | ' | ' | ' | ' |
Guarantee obligations period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | '10 years | ' | ' | ' | ' | ' |
Payment of guarantees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,500,000 | ' | ' | ' | ' | ' | ' |
Standby letters of credit | 2,600,000 | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amounts drawn on letters of credit | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Litigation judgment | ' | ' | ' | ' | ' | ' | ' | ' | 15,900,000 | 16,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in estimated liability related to litigation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in estimated liability related to litigation, interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 222,000 | 243,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent liabilities related to legal matters | ' | ' | 1,800,000 | 1,500,000 | ' | ' | ' | ' | ' | ' | 24,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional loss exposure for all legal matters | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,000,000 | ' |
Off-balance sheet risks, face amount, asset | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,000,000 |
Line of credit facility, amount drawn | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
RelatedParty_Transactions_Addi
Related-Party Transactions - Additional Information (Detail) (USD $) | 3 Months Ended | ||
Mar. 29, 2014 | Mar. 30, 2013 | Dec. 28, 2013 | |
Related Party Transaction [Line Items] | ' | ' | ' |
Net payable of advertising funds | $14,600,000 | ' | $17,600,000 |
Fee for managing advertising funds | 1,900,000 | 1,500,000 | ' |
Supplemental advertising fund contribution | 0 | 1,000,000 | ' |
Advertising funds contribution, company-owned restaurant | 264,000 | 236,000 | ' |
Advertising funds contribution, prepaid future initiatives | 1,700,000 | ' | ' |
Royalties receivable from joint ventures | 983,000 | ' | 1,400,000 |
B-R 31 Ice Cream Co., Ltd. ("BR Japan") | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Royalty received from joint venture | 311,000 | 402,000 | ' |
BR Korea Co., Ltd. ("BR Korea") | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Royalty received from joint venture | 1,047,000 | 1,010,000 | ' |
Coffee Alliance, S.L. (Coffee Alliance) | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Loans receivable | 2,700,000 | ' | 2,700,000 |
Royalty received from joint venture | 0 | 98,000 | ' |
Related Party | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Royalty received from joint venture | 1,358,000 | 1,510,000 | ' |
Joint Ventures | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Payments to joint ventures | 495,000 | 1,000,000 | ' |
Australia Joint Venture | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Revenue from related parties | 1,100,000 | ' | ' |
Ownership percentage | 20.00% | ' | ' |
Due from joint ventures | 726,000 | ' | 733,000 |
SPAIN | Coffee Alliance, S.L. (Coffee Alliance) | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Loans receivable, additions | ' | $662,000 | ' |