Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 27, 2020 | Mar. 01, 2021 | Jun. 26, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 27, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 001-35603 | ||
Entity Registrant Name | CHUY’S HOLDINGS, INC. | ||
Entity Central Index Key | 0001524931 | ||
Current Fiscal Year End Date | --12-27 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-5717694 | ||
Entity Address, Address Line One | 1623 Toomey Rd. | ||
Entity Address, City or Town | Austin | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 78704 | ||
City Area Code | (512) | ||
Local Phone Number | 473-2783 | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Trading Symbol | CHUY | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 264 | ||
Entity Common Stock, Shares Outstanding | 19,717,380 | ||
ICFR Auditor Attestation Flag | true |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 27, 2020 | Dec. 29, 2019 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 86,817 | $ 10,074 |
Accounts receivable | 1,507 | 1,426 |
Lease incentives receivable | 200 | 250 |
Inventories | 1,449 | 1,657 |
Income tax receivable | 974 | 0 |
Prepaid expenses and other current assets | 3,614 | 3,376 |
Total current assets | 94,561 | 16,783 |
Property and equipment, net | 185,105 | 210,750 |
Operating lease assets | 159,156 | 169,299 |
Deferred tax asset, net | 7,806 | 2,601 |
Other assets and intangible assets, net | 1,078 | 667 |
Trade name | 21,900 | 21,900 |
Goodwill | 24,069 | 24,069 |
Total assets | 493,675 | 446,069 |
CURRENT LIABILITIES | ||
Accounts payable | 2,977 | 4,253 |
Accrued liabilities | 25,775 | 21,107 |
Operating lease liabilities | 14,566 | 10,307 |
Income tax payable | 0 | 532 |
Total current liabilities | 43,318 | 36,199 |
Operating lease liabilities, less current portion | 207,601 | 214,541 |
Other liabilities | 898 | 393 |
Total liabilities | 251,817 | 251,133 |
Contingencies | ||
Stockholders’ equity | ||
Common stock, $0.01 par value; 60,000,000 shares authorized; 19,710,549 shares issued and outstanding at December 27, 2020 and 16,636,464 shares issued and outstanding at December 29, 2019 | 197 | 166 |
Preferred stock, $0.01 par value; 15,000,000 shares authorized and no shares issued or outstanding at December 27, 2020 and December 29, 2019 | 0 | 0 |
Paid-in capital | 144,897 | 94,712 |
Retained earnings | 96,764 | 100,058 |
Total stockholders’ equity | 241,858 | 194,936 |
Total liabilities and stockholders’ equity | $ 493,675 | $ 446,069 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 27, 2020 | Dec. 29, 2019 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 60,000,000 | 60,000,000 |
Common Stock, Shares, Issued | 19,710,549 | 16,636,464 |
Common Stock, Shares, Outstanding | 19,710,549 | 16,636,464 |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 15,000,000 | 15,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Consolidated Income Statements
Consolidated Income Statements - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Revenue | $ 320,952 | $ 426,357 | $ 398,200 |
Costs and expenses: | |||
Cost of sales | 79,033 | 110,152 | 101,946 |
Labor | 98,184 | 150,779 | 144,325 |
Operating | 50,352 | 62,121 | 57,457 |
Occupancy | 29,406 | 32,151 | 30,028 |
General and administrative | 22,195 | 23,681 | 20,725 |
Marketing | 2,732 | 5,555 | 3,929 |
Restaurant pre-opening | 1,769 | 2,949 | 4,382 |
Legal settlement | 0 | 615 | 0 |
Impairment, closed restaurant and other costs | 26,794 | 14,179 | 12,336 |
Gain on insurance settlements | (1,000) | 0 | 0 |
Depreciation | 20,031 | 20,739 | 19,804 |
Total costs and expenses | 329,496 | 422,921 | 394,932 |
(Loss) income from operations | (8,544) | 3,436 | 3,268 |
Interest expense | 257 | 122 | 83 |
(Loss) income before income taxes | (8,801) | 3,314 | 3,185 |
Income tax benefit | (5,507) | (2,901) | (2,354) |
Net (loss) income | $ (3,294) | $ 6,215 | $ 5,539 |
Net (loss) income per common share: | |||
Basic | $ (0.18) | $ 0.37 | $ 0.33 |
Diluted | $ (0.18) | $ 0.37 | $ 0.32 |
Weighted-average shares outstanding: | |||
Basic | 18,396,335 | 16,728,955 | 16,931,589 |
Diluted | 18,396,335 | 16,824,395 | 17,062,347 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity Statement - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock [Member] | Common Stock [Member]Cumulative Effect, Period of Adoption, Adjustment | Paid-in Capital [Member] | Paid-in Capital [Member]Cumulative Effect, Period of Adoption, Adjustment | Retained Earnings [Member] | Retained Earnings [Member]Cumulative Effect, Period of Adoption, Adjustment |
Beginning balance (in shares) | 16,923,741 | |||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201602Member | |||||||
Beginning balance at Dec. 31, 2017 | $ 188,962 | $ 169 | $ 100,140 | $ 88,653 | ||||
Stock-based compensation | 3,297 | 0 | 3,297 | 0 | ||||
Proceeds from exercise of stock options | 453 | $ 0 | 453 | 0 | ||||
Proceeds from exercise of stock options (in shares) | 25,745 | |||||||
Settlement of restricted stock units | 0 | $ 1 | (1) | 0 | ||||
Settlement of restricted stock units (in shares) | 95,581 | |||||||
Repurchase of shares of common stock | (159,570) | |||||||
Repurchase of shares of common stock | (3,607) | $ (2) | (3,605) | 0 | ||||
Indirect repurchase of shares for minimum tax withholdings (shares) | (29,124) | |||||||
Indirect repurchase of shares for minimum tax withholdings | (793) | $ 1 | (794) | 0 | ||||
Net (loss) income | 5,539 | $ 0 | 0 | 5,539 | ||||
Balance (in shares) at Dec. 30, 2018 | 16,856,373 | |||||||
Ending balance at Dec. 30, 2018 | 193,851 | $ (349) | $ 169 | $ 0 | 99,490 | $ 0 | 94,192 | $ (349) |
Stock-based compensation | 3,501 | 0 | 3,501 | 0 | ||||
Proceeds from exercise of stock options | 388 | $ 0 | 388 | |||||
Proceeds from exercise of stock options (in shares) | 46,936 | |||||||
Settlement of restricted stock units | $ 0 | $ 1 | (1) | 0 | ||||
Settlement of restricted stock units (in shares) | 123,496 | |||||||
Repurchase of shares of common stock | (351,774) | (351,774) | ||||||
Repurchase of shares of common stock | $ (7,793) | $ (4) | (7,789) | 0 | ||||
Indirect repurchase of shares for minimum tax withholdings (shares) | (38,567) | |||||||
Indirect repurchase of shares for minimum tax withholdings | (877) | $ 0 | (877) | 0 | ||||
Net (loss) income | 6,215 | $ 0 | 0 | 6,215 | ||||
Balance (in shares) at Dec. 29, 2019 | 16,636,464 | |||||||
Ending balance at Dec. 29, 2019 | 194,936 | $ 166 | 94,712 | 100,058 | ||||
Stock-based compensation | 3,922 | 0 | 3,922 | 0 | ||||
Proceeds from exercise of stock options | 234 | $ 0 | 234 | 0 | ||||
Proceeds from exercise of stock options (in shares) | 20,918 | |||||||
Settlement of restricted stock units | 0 | $ 1 | (1) | 0 | ||||
Settlement of restricted stock units (in shares) | 146,325 | |||||||
Sale of common stock from ATM offering, net of fees and expenses | $ 48,167 | $ 31 | 48,136 | 0 | ||||
Sales of common stock from ATM offering, net of fees and expenses (in shares) | 3,041,256 | 3,041,256 | ||||||
Repurchase of shares of common stock | (90,144) | (90,144) | ||||||
Repurchase of shares of common stock | $ (1,422) | $ (1) | (1,421) | 0 | ||||
Indirect repurchase of shares for minimum tax withholdings (shares) | (44,270) | |||||||
Indirect repurchase of shares for minimum tax withholdings | (685) | $ 0 | (685) | 0 | ||||
Net (loss) income | (3,294) | $ 0 | 0 | (3,294) | ||||
Balance (in shares) at Dec. 27, 2020 | 19,710,549 | |||||||
Ending balance at Dec. 27, 2020 | $ 241,858 | $ 197 | $ 144,897 | $ 96,764 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Cash flows from operating activities: | |||
Net (loss) income | $ (3,294) | $ 6,215 | $ 5,539 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 20,031 | 20,739 | 19,804 |
Amortization of operating lease assets | 9,233 | 7,965 | 0 |
Amortization of loan origination costs | 53 | 33 | 33 |
Loss on asset impairment, closed restaurant and other costs | 22,138 | 12,693 | 12,336 |
Stock-based compensation | 3,702 | 3,286 | 3,096 |
Loss on disposal of property and equipment | 437 | 283 | 97 |
Amortization of deferred lease incentives | 0 | 0 | (2,869) |
Deferred income taxes | (5,205) | (5,096) | (3,837) |
Changes in operating assets and liabilities: | |||
Accounts receivable | (81) | 628 | 642 |
Lease incentive receivable | 50 | 1,347 | 4,754 |
Inventories | 208 | (116) | 64 |
Income tax receivable and payable | (1,506) | 1,135 | 622 |
Prepaid expenses and other assets | (397) | 995 | 2,188 |
Accounts payable | (1,302) | (2,594) | (1,454) |
Accrued and other liabilities | 5,173 | 4,279 | 733 |
Accrued deferred rent | 0 | 0 | 2,752 |
Operating Lease, Payments | (6,526) | (8,361) | 0 |
Deferred lease incentives | 0 | 0 | 3,382 |
Net cash provided by operating activities | 42,714 | 43,431 | 47,882 |
Cash flows from investing activities: | |||
Purchase of property and equipment, net | (12,149) | (32,870) | (44,087) |
Purchase of other assets | 0 | (404) | (434) |
Net cash used in investing activities | (12,149) | (33,274) | (44,521) |
Cash flows from financing activities: | |||
Net Proceeds from Sale of Common Stock | 48,167 | 0 | 0 |
Borrowings under revolving line of credit | 25,000 | 5,000 | 0 |
Payments under revolving line of credit | (25,000) | (5,000) | 0 |
Loan origination costs | (116) | 0 | 0 |
Proceeds from the exercise of stock options | 234 | 388 | 453 |
Payments for Repurchase of Common Stock | (1,422) | (7,793) | (3,607) |
Indirect repurchase of shares for minimum tax withholdings | (685) | (877) | (793) |
Net cash provided by (used in) financing activities | 46,178 | (8,282) | (3,947) |
Net increase (decrease) in cash and cash equivalents | 76,743 | 1,875 | (586) |
Cash and cash equivalents, beginning of period | 10,074 | 8,199 | 8,785 |
Cash and cash equivalents, end of period | 86,817 | 10,074 | 8,199 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Property and equipment and other assets acquired by accounts payable | 26 | 384 | 1,521 |
Supplemental cash flow disclosures: | |||
Cash paid for interest | 202 | 77 | 35 |
Cash paid for income taxes | $ 1,232 | $ 1,059 | $ 862 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 27, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Description | Description of Business Chuy’s Holdings, Inc., a Delaware corporation (the “Company”), through its subsidiaries owns and operates restaurants across 17 states including Texas, the Southeastern and Midwestern United States. All of the Company’s restaurants operate under the name Chuy’s. The Company operated 92 as of December 27, 2020, and 100 restaurants as of December 29, 2019 and December 30, 2018. Chuy’s was founded in Austin, Texas in 1982 and prior to 2006, operated as Chuy’s Comida Deluxe, Inc. (“Chuy’s”). The Company was incorporated in November 2006. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 27, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Summary of Significant Accounting Policies Principles of consolidation The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated. Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation. These reclassifications have no effect on previously reported net income, income per share or stockholder's equity. Fiscal year The Company utilizes a 52- or 53-week fiscal year that ends on the last Sunday of the calendar year. The fiscal years ended December 27, 2020, December 29, 2019 and December 30, 2018 each consisted of 52 weeks. COVID-19 pandemic During March 2020, the World Health Organization declared the COVID-19 outbreak to be a global pandemic and the United States declared a National Public Health Emergency. The COVID-19 pandemic has significantly impacted health and economic conditions throughout the United States. Federal, state and local governments took a variety of actions to contain the spread of COVID-19. Many jurisdictions where our restaurants are located required mandatory closures or imposed capacity limitations and other restrictions affecting our operations. As of December 27, 2020, the Company had reopened dining rooms at varying degrees of operating capacity in 92 of its 101 restaurants and nine restaurants remained temporarily closed. During the year-ended December 27, 2020, the Company took various steps to reduce non-essential spend, postpone restaurant development and rightsize operations in light of reduced sales volume to improve our store level profitability and increase our cash flows. The Company also enhanced its liquidity position by selling shares of its common stock in an "At-The-Market" ("ATM") offering and using a portion of the net proceeds to repay the $25.0 million outstanding under its revolving credit facility. As of December 27, 2020, the Company had $86.8 million in cash and cash equivalents, no debt and $25.0 million of availability under its revolving credit facility. Management believes the Company's strong financial position, combined with the measures taken during the pandemic, will allow the Company to meet its financial obligations over the next twelve months. We cannot predict how soon we will be able to reopen all of our restaurants at full capacity, and our ability to reopen and stay open will depend in part on the actions of a number of governmental bodies over which we have no control. Moreover, once restrictions are lifted, it is unclear how quickly customers will return to our restaurants, which may be a function of continued concerns over safety and/or depressed consumer sentiment due to adverse economic conditions, including job losses. Accounting estimates The preparation of the consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the period. Actual results could differ from estimates. Cash and cash equivalents The Company considers all cash and short-term investments with original maturities of three months or less as cash equivalents. Amounts receivable from credit card processors are considered cash equivalents because they are both short in term and highly liquid in nature, and are typically converted to cash within three business days of the sales transactions. Lease incentives receivable Lease incentives receivable consist of receivables from landlords provided for under the lease agreements to reimburse the Company for leasehold improvements. Inventories Inventories consist of food, beverage, and merchandise and are stated at the lower of cost (first-in, first-out method) or net realizable value. Property and equipment Property and equipment, net are recorded at cost, less accumulated depreciation. Equipment consists primarily of restaurant equipment, furniture, fixtures and smallwares. Depreciation is calculated using the straight-line method over the estimated useful life of the related asset, which ranges from 3 to 15 years. Expenditures for major additions and improvements are capitalized. Leasehold improvements are capitalized and amortized using the straight-line method over the shorter of the lease term, including option periods that are reasonably assured of renewal, or the estimated useful life of the asset, which ranges from five Leases and leasehold improvements The Company leases land and or buildings for its corporate offices and all of its restaurants under various long-term operating lease agreements. The Company determines if a contract contains a lease at inception. The lease term begins on the date that the Company takes possession under the lease, including the pre-opening period during construction, when in many cases the Company is not making rent payments. Operating lease assets and liabilities are recognized at the lease commencement date for material leases with a term of greater than 12 months. Operating lease liabilities represent the present value of future minimum lease payments. Since our leases do not provide an implicit rate, our operating lease liabilities are calculated using the Company's secured incremental borrowing rate at lease commencement. We have no outstanding debt, and as a result, we estimate this rate based on prevailing financial market conditions, comparable companies, credit analysis and management judgment. Minimum lease payments include only fixed lease components of the agreement, as well as variable rate payments that depend on an index, initially measured using the index at the lease commencement date. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepaid or accrued lease payments, initial direct costs and lease incentives. Lease incentives are recognized when earned and reduce our operating lease asset related to the lease. They are amortized through the operating lease assets as reductions of rent expense over the lease term. Operating lease expense is recognized on a straight-line basis over the lease term. Certain of the Company’s operating leases contain clauses that provide for contingent rent based on a percentage of sales greater than certain specified target amounts. Variable lease payments that do not depend on a rate or index, escalation in the index subsequent to the initial measurement, payments associated with non-lease components such as common area maintenance, real estate taxes and insurance, and short-term lease payments (leases with less than a 12 month term) are expensed as incurred or when the achievement of the specified target that triggers the contingent rent is considered probable. Other assets and intangible assets Other assets and intangible assets include liquor licenses, lease acquisition costs and loan origination costs which are all stated at cost, less any accumulated amortization, as well as deferred compensation plan assets which are stated at fair value. Goodwill Goodwill represents the excess of cost over the fair value of assets of the businesses acquired. Goodwill is not amortized, but is subject to impairment tests at least annually. The Company performs a quantitative test to assess potential impairments at the end of the fiscal year or during the year if an event or other circumstance indicates that goodwill may be impaired. The goodwill impairment test compares the fair value of the reporting unit to the carrying amount, including goodwill. The Company considers all of its stores in total as one reporting unit. If the fair value of the reporting unit is less than the carrying amount, an impairment charge is recorded for the difference, limited to the total amount of goodwill allocated to that reporting unit. No goodwill impairment charges were recognized during 2020, 2019, or 2018. Indefinite life intangibles An intangible asset is determined to have an indefinite useful life when there are no legal, regulatory, contractual, competitive, economic or other factors that may limit the period over which the asset is expected to contribute directly or indirectly to the future cash flows of the Company. Intangible assets acquired in a business combination are determined to have an indefinite useful life and are not amortized. The annual impairment evaluation for indefinite life intangible assets is performed at the end of the fiscal year and includes an assessment to determine whether the fair value of the indefinite life intangible assets is less than their carrying value. We calculate the estimated fair value of the indefinite-lived intangible asset and compare it to the carrying value. Fair value is estimated primarily using future discounted cash flow projections in conjunction with qualitative factors and future operating plans. When the carrying value exceeds fair value, an impairment charge is recorded for the amount of the difference. The Company also annually evaluates intangible assets that are not being amortized to determine whether events and circumstances continue to support an indefinite useful life. If an intangible asset that is not being amortized is determined to have a finite useful life, the asset will be amortized prospectively over the estimated remaining useful life and accounted for in the same manner as intangible assets subject to amortization. No indefinite life intangible impairment charges were recognized during 2020, 2019, or 2018. Impairment of long-lived assets The Company reviews long-lived assets, such as property and equipment, operating lease assets and intangibles, subject to amortization, for impairment when events or circumstances indicate the carrying value of the assets may not be recoverable. In determining the recoverability of the asset value, an analysis is performed at the individual restaurant level and primarily includes an assessment of historical undiscounted cash flows and other relevant factors and circumstances. The Company evaluates future cash flow projections in conjunction with qualitative factors and future operating plans and regularly reviews any restaurants with a deficient level of cash flows for the previous 24 months to determine if impairment testing is necessary. Recoverability of assets to be held and used is measured by a comparison of the carrying value of the restaurant to its estimated future undiscounted cash flows. If the estimated undiscounted future cash flows are less than the carrying value, we determine if there is an impairment loss by comparing the carrying value of the restaurant to its estimated fair value. Based on this analysis, if the carrying value of the restaurant exceeds its estimated fair value, an impairment charge is recognized by the amount by which the carrying value exceeds the fair value. We make assumptions to estimate future cash flows and asset fair values. The estimated fair value is generally determined using the depreciated replacement cost method, the market approach, or discounted cash flow projections. Estimated future cash flows are highly subjective assumptions based on Company’s projections and understanding of our business, historical operating results, and trends in sales and restaurant level operating costs. The Company’s impairment assessment process requires the use of estimates and assumptions regarding future cash flows and operating outcomes, which are based upon a significant degree of management judgment. The estimates used in the impairment analysis represent a Level 3 fair value measurement. The Company continues to assess the performance of restaurants and monitors the need for future impairment. Changes in the economic environment, real estate markets, capital spending, overall operating performance and underlying assumptions could impact these estimates and result in future impairment charges. As a result of the above mentioned process, the Company recorded a non-cash loss on asset impairment of $20.9 million during the fiscal year ended December 27, 2020, $12.7 million during the fiscal year ended December 29, 2019 and $12.3 million during the fiscal year December 30, 2018. Estimated fair value of financial instruments The Company uses a three-tier value hierarchy, which classifies the inputs used in measuring fair values, in determining the fair value of the Company's non-financial assets and non-financial liabilities. These tiers include: Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. There were no changes in the methods or assumptions used in measuring fair value during the period. The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable at December 27, 2020 and December 29, 2019 approximate their fair value due to the short-term maturities of these financial instruments. These inputs are categorized as Level 1 inputs. The Company provides a certain group of eligible employees the ability to participate in the Company's nonqualified deferred compensation plan. This plan allows participants to defer up to 80% of their salary and up to 100% of their bonus, on pre-tax basis, and contribute such amounts to one or more investment funds held in a rabbi trust. We report the accounts of the rabbi trust in other assets and intangible assets, net, and the corresponding liability in other liabilities on our consolidated balance sheets. The investments are considered trading securities and are reported at fair value based on quoted market prices. The deferred compensation plan assets and liabilities are measured and recorded at their fair value on recurring basis. The inputs are recognized as Level 1 inputs. The realized and unrealized gains and losses on these investments, as well as the offsetting compensation expense, are recorded in general and administrative expense in the consolidated statements of income. At December 27, 2020, the Company had approximately $0.8 million of deferred compensation plan assets and $0.9 million of deferred plan liabilities. At December 29, 2019, the Company had approximately $0.4 million of both deferred compensation plan assets and liabilities. In regards to the Company's impairment analysis, we generally estimate long-lived asset fair values, including property and equipment and leasehold improvements as well as operating lease assets and liabilities, using either depreciated replacement cost method, the market approach or discounted cash flow projections. The inputs used to determine fair value relate primarily to the assumptions regarding the long-lived assets exit cost at their highest and best use and future assumptions regarding restaurant sales and profitability. These inputs are categorized as Level 3 inputs. The inputs used represent assumptions about what information market participants would use in pricing the assets and are based upon the best information available at the time of the analysis. Loan origination costs Loan origination costs are capitalized and amortized over the term of the related debt and is included in Interest expense, net on the consolidated statements of income. Revenue recognition Revenue from restaurant operations (food, beverage and alcohol sales) and merchandise sales are recognized upon satisfaction of the single performance obligation which occurs upon payment by the customer at the time of sale. Revenues are reflected net of sales tax and certain discounts and allowances. We offer our customers delivery at certain of our restaurants through third party delivery service's website or apps. We recognize this revenue when the control of the food is transferred to the delivery service, excluding any delivery fees charged to the customer. We receive payment subsequent to the transfer of food. Proceeds from the sale of gift cards are recorded as deferred revenue at the time of sale and recognized as revenue upon redemption by the customer. Breakage is recognized on unredeemed gift cards as revenue proportionate to the pattern of gift card redemptions less any legal obligation to remit the unredeemed gift cards to the relevant jurisdictions. We recorded $0.1 million, $0.1 million and $0.2 million of gift card breakage in fiscal years 2020, 2019 and 2018, respectively. Marketing The Company expenses the printing of menus and other promotional materials as incurred. The costs of community service and sponsorship activities are expensed on the expected timing of those events. Marketing expense was $2.7 million, $5.6 million, and $3.9 million for the years ended December 27, 2020, December 29, 2019 and December 30, 2018, respectively. Restaurant pre-opening costs Restaurant pre-opening costs consist primarily of manager salaries, relocation costs, supplies, recruiting expenses, travel and lodging, pre-opening activities, employee payroll and related training costs for employees at the new location. The Company expenses such pre-opening costs as incurred. Pre-opening costs also include rent recorded during the period between date of possession and the restaurant opening date. Stock-based compensation The Company maintains an equity incentive plan under which the Company's board of directors can grant stock options, restricted stock units, and other equity-based awards to directors, officers, and key employees of the Company. The plan provides for granting of options to purchase shares of common stock at an exercise price not less than the fair value of the stock on the date of grant. The Company recognizes stock-based compensation in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 718 ("Topic 718"). Stock-based compensation cost includes compensation cost for all share-based payments granted based on the grant date fair value estimated in accordance with the provisions of Topic 718. Compensation cost is recognized on a straight-line basis over the requisite service period of each award. The forfeitures are recognized when they occur. Income tax matters Income tax provisions are comprised of federal and state taxes currently due, plus deferred taxes. Deferred tax assets and liabilities are recognized for future tax consequences attributable to the temporary difference between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred tax assets are recognized when management considers the realization of those assets in future periods to be more likely than not. Future taxable income, adjustments in temporary differences, available carryforward periods and changes in tax laws could affect these estimates. Segment reporting ASC Topic No. 280, "Segment Reporting," establishes standards for disclosures about products and services, geographic areas and major customers. The Company currently operates one reporting segment; full-service, casual dining, Mexican food restaurants. Additionally, we operate in one geographic area: the United States of America. Revenue from customers is derived principally from food and beverage sales and the Company does not rely on any major customers as a source of revenue. Recent accounting pronouncements The Company's management reviewed all significant newly-issued accounting pronouncements and concluded that they either are not applicable to the Company's operations or that no material effect is expected on the Company's consolidated financial statements as a result of future adoption. |
Net (Loss) Income Per Share
Net (Loss) Income Per Share | 12 Months Ended |
Dec. 27, 2020 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income Per Share | Net (Loss) Income Per Share Basic net (loss) income per share of common stock was computed by dividing net (loss) income by the weighted-average number of shares of common stock outstanding for the period. Diluted net (loss) income per share of common stock is computed on the basis of the weighted-average number of shares of common stock plus the effect of dilutive potential shares of common stock equivalents outstanding during the period using the treasury stock method for dilutive options and restricted stock units (these shares were granted under the Chuy's Holdings, Inc. 2012 Omnibus Equity Incentive Plan (the "2012 Plan") and the Chuy's Holdings, Inc. 2020 Omnibus Incentive Plan (the "2020 Plan")). There were approximately 40,500, 25,800 and 8,700 shares of common stock equivalents that have been excluded from the calculation of diluted net (loss) income per share because their inclusion would have been anti-dilutive for the years ended December 27, 2020, December 29, 2019 and December 30, 2018, respectively. The computations of basic and diluted net (loss) income per share is as follows: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 BASIC Net (loss) income $ (3,294) $ 6,215 $ 5,539 Weighted-average common shares outstanding 18,396,335 16,728,955 16,931,589 Basic net (loss) income per common share $ (0.18) $ 0.37 $ 0.33 DILUTED Net (loss) income $ (3,294) $ 6,215 $ 5,539 Weighted-average common shares outstanding 18,396,335 16,728,955 16,931,589 Dilutive effect of stock options and restricted stock units — 95,440 130,758 Weighted-average of diluted shares 18,396,335 16,824,395 17,062,347 Diluted net (loss) income per common share $ (0.18) $ 0.37 $ 0.32 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 27, 2020 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets The major classes of prepaid expenses and other current assets at December 27, 2020 and December 29, 2019 are summarized as follows: December 27, 2020 December 29, 2019 Deposits on equipment $ 418 $ 782 Prepaid expenses 2,950 2,394 Other current assets 246 200 Total prepaid expenses and other current assets $ 3,614 $ 3,376 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 27, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property Equipment, Net | Property and Equipment, Net The major classes of property and equipment as of December 27, 2020 and December 29, 2019 are summarized as follows: December 27, 2020 December 29, 2019 Leasehold improvements $ 196,345 $ 205,491 Furniture, fixtures and equipment 97,149 98,895 Construction in progress 14,613 13,072 Land 1,898 1,898 310,005 319,356 Less accumulated depreciation (124,900) (108,606) Total property and equipment, net $ 185,105 $ 210,750 |
Other Assets and Other Intangib
Other Assets and Other Intangible Assets, Net | 12 Months Ended |
Dec. 27, 2020 | |
Other Assets and Other Intangible Assets [Abstract] | |
Other Assets and Other Intangible Assets, Net | Other Assets and Intangible Assets, Net The major classes of other assets and intangibles assets along with related accumulated amortization at December 27, 2020 and December 29, 2019 are summarized as follows: Average Life at December 27, 2020 2020 2019 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Finite-lived assets: Loan origination costs 1.3 $ 410 $ (320) $ 90 $ 294 $ (267) $ 27 Total finite-lived assets 410 (320) 90 294 (267) 27 Indefinite-lived assets: Liquor license 214 — 214 214 — 214 Total indefinite-lived assets 214 — 214 214 — 214 Other noncurrent assets (1) 774 — 774 $ 426 — 426 Total other assets and intangible assets $ 1,398 $ (320) $ 1,078 $ 934 $ (267) $ 667 (1) Other noncurrent assets primarily consists of deferred compensation plan assets recorded at fair value. See Note 2 for additional information. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 27, 2020 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Revolving Credit Facility On November 30, 2012, the Company entered into a $25.0 million Revolving Credit Facility with Wells Fargo Bank, National Association. On May 21, 2020, the Company entered into the second amendment (the “Amendment”) to its Revolving Credit Facility (as amended, the "Revolving Credit Facility") to (1) extend the maturity date to April 30, 2022, (2) relax compliance with the financial covenants during the COVID-19 pandemic through the new maturity date and (3) revise the applicable margins and leverage ratios that determine the commitment fees and interest payable by the Company. Under our Revolving Credit Facility, we may request to increase the size of our Revolving Credit Facility by up to $25.0 million, in minimum principal amounts of $5.0 million or the remaining amount of the $25.0 million if less than $5.0 million (the "Incremental Revolving Loan"). In the event that any of the lenders fund the Incremental Revolving Loan, the terms and provisions of the Incremental Revolving Loan will be the same as under the Company's Revolving Credit Facility. Borrowings under the Revolving Credit Facility generally bear interest at a variable rate based upon the Company's election, of (i) the base rate (which is the highest of prime rate, federal funds rate plus 0.5% or one month LIBOR plus 1%), or (ii) LIBOR, plus, in either case, an applicable margin based on the Company's consolidated total leverage ratio (as defined in the Amendment) with a LIBOR floor of 1.0%. The Revolving Credit Facility also requires payment for commitment fees that accrue on the daily unused commitment of the lender at the applicable margin, which varies based on the Company's consolidated total leverage ratio. The Revolving Credit Facility also requires compliance with a fixed charge coverage ratio, a consolidated total leverage ratio, growth capital expenditure limitation during fiscal years 2020 and 2021 and a minimum monthly liquidity requirement of $5.0 million. The Revolving Credit Facility also has certain restrictions on the payment of dividends and distributions. Under the Revolving Credit Facility, the Company may declare and make dividend payments so long as (i) no default or event of default has occurred and is continuing or would result therefrom and (ii) immediately after giving effect to any such dividend payment, on a pro forma basis, the lease adjusted leverage ratio does not exceed 3.50 to 1.00. The obligations under the Company's Revolving Credit Facility are secured by a first priority lien on substantially all of the Company's asset. As of December 27, 2020, the Company had no borrowings under the Revolving Credit Facility, and we were in compliance with all covenants. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 27, 2020 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities The major classes of accrued liabilities at December 27, 2020 and December 29, 2019 are summarized as follows: December 27, 2020 December 29, 2019 Accrued compensation and related benefits $ 14,007 $ 9,342 Other accruals 3,987 4,302 Property tax 3,054 2,220 Deferred gift card revenue 2,527 2,289 Sales and use tax 2,200 2,954 Total accrued liabilities $ 25,775 $ 21,107 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 27, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders' Equity ATM offering During the second quarter of 2020, the Company issued 3,041,256 shares of its common stock and received net proceeds of $48.2 million after deducting sales agent commissions and offering expenses. A portion of the net proceeds was used to repay the $25.0 million outstanding under the Company Revolving Credit Facility. The Company intends to use the remaining net proceeds from the ATM offering for general corporate purposes, including, but not limited to, increasing its liquidity as a result of the COVID-19 pandemic. Share repurchase program On October 26, 2017, the Company's board of directors approved a share repurchase program under which it authorized the Company, at its discretion, to repurchase up to $30.0 million of its common stock through December 31, 2019. On October 31, 2019, the Company’s board of directors authorized a new share repurchase program under which the Company may, at its discretion, repurchase up to another $30.0 million of its common shares outstanding. This repurchase program became effective on January 1, 2020, after the expiration of the previous share repurchase authorization, and expires on December 31, 2022. Repurchases of the Company's outstanding common stock will be made in accordance with applicable laws and may be made at management's discretion from time to time in the open market, through privately negotiated transactions or otherwise, including pursuant to Rule 10b5-1 trading plans. There is no guarantee as to the exact number of shares to be repurchased by the Company. The timing and extent of repurchases will depend upon several factors, including market and business conditions, regulatory requirements and other corporate considerations, and repurchases may be discontinued at any time. During the fiscal years ended 2020 and 2019, the Company repurchased approximately 90,144 and 351,774 shares of common stock for a total cost of $1.4 million and $7.8 million, respectively. As a result of COVID-19, the company temporarily |
Leases
Leases | 12 Months Ended |
Dec. 27, 2020 | |
Leases [Abstract] | |
Operating Leases | Leases The Company determines if a contract contains a lease at inception.The Company's material long-term operating lease agreements are for the land and buildings for our restaurants as well as our corporate offices. The lease term begins on the date that the Company takes possession under the lease, including the pre-opening period during the construction, when in many cases the Company is not making rent payments. The initial lease terms range from 10 years to 15 years, most of which include renewal options totaling 10 to 15 years. The lease term is generally the minimum of the noncancelable period or the lease term including renewal options which are reasonably certain of being exercised up to a term of approximately 20 years. Operating lease assets and liabilities are recognized at the lease commencement date for material leases with a term of greater than 12 months. Operating lease liabilities represent the present value of future minimum lease payments. Since our leases do not provide an implicit rate, our operating lease liabilities are calculated using the Company's secured incremental borrowing rate at lease commencement. We estimate this rate based on prevailing financial market conditions, comparable companies, credit analysis and management judgment. Minimum lease payments include only fixed lease components of the agreement, as well as variable rate payments that depend on an index, initially measured using the index at the lease commencement date. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepaid or accrued lease payments, initial direct costs and lease incentives. Lease incentives are recognized when construction milestones are met and reduce our operating lease asset. They are amortized through the operating lease assets as reductions of rent expense over the lease term. Operating lease expense is recognized on a straight-line basis over the lease term. Variable lease payments that do not depend on a rate or index, escalation in the index subsequent to the initial measurement, payments associated with non-lease components such as common area maintenance, real estate taxes and insurance, and short-term lease payments (leases with a term with 12 months or less) are expensed as incurred. Certain of the Company’s operating leases contain clauses that provide for contingent rent based on a percentage of sales greater than certain specified target amounts. These variable payments are expensed when the achievement of the specified target that triggers the contingent rent is considered probable. As of December 27, 2020, all of the Company's leases were operating. During the second quarter of 2020, the Company suspended lease payments for the months of April through June 2020 as a result of the COVID-19 pandemic. The Company was able to negotiate rent concessions, abatements and deferrals with landlords on a large portion of our operating leases. Financial Accounting Standards Board ("FASB") issued a clarification to accounting for lease concessions in response to the COVID-19 pandemic to reduce the operational challenges and complexity of lease accounting. The Company used the relief provisions provided by FASB and made an election to account for the lease concessions as if they were part of the original lease agreement. As a result of these negotiations, the Company recorded $2.9 million of deferred rent as part of our operating lease liability as of December 27, 2020. The recognition of rent concessions did not have a material impact on our consolidated financial statements. Components of operating lease costs are included in occupancy, closed restaurant costs, restaurant pre-opening, general and administrative expense and property and equipment, net: Year Ended Lease cost December 27, 2020 December 29, 2019 Operating lease cost (a) $ 26,419 $ 25,478 Variable lease cost 515 1,103 $ 26,934 $ 26,581 (a) Includes short-term operating lease costs which are immaterial. Supplemental cash flow disclosures and other lease information : Year Ended December 27, 2020 December 29, 2019 Cash paid for operating lease liabilities 23,021 25,781 Operating lease assets obtained in exchange for operating lease liabilities (a) 3,845 177,701 (a) The year-ended December 27, 2020 includes a $5.6 million reduction to the operating lease assets and liabilities mainly as a result of shortening the remaining life of certain leases as well as a $9.4 million increase due to new lease commencements. The year-ended December 29, 2019 includes the transition adjustment for the adoption of Leases (Topic 842) of $170.3 million, new lease commencements of $11.7 million as well as a $4.3 million reduction to the operating lease assets and liabilities as a result of shortening the remaining life of certain leases. The Company recorded $0.2 million and $0.9 million in deferred lease incentives during the fiscal year ended December 27, 2020 and December 29, 2019, respectively. Supplemental balance sheet disclosures: Operating leases Classification December 27, 2020 December 29, 2019 Right-of-use assets Operating lease assets $ 159,156 $ 169,299 Deferred Rent Payments Operating lease liability 2,169 — Current lease liabilities Operating lease liability 12,397 10,307 14,566 10,307 Deferred Rent Payments Operating lease liability, less current portion 746 — Non-current lease liabilities Operating lease liability, less current portion 206,855 214,541 207,601 214,541 Total lease liabilities $ 222,167 $ 224,848 Weighted average remaining lease term (in years) 13.8 15.0 Weighted average discount rate 7.9 % 7.8 % Future minimum rent payments for our operating leases for each of the next five years as of December 27, 2020 are as follows: Fiscal years ending: 2021 $ 31,161 2022 28,775 2023 28,223 2024 26,936 2025 26,522 Thereafter 220,521 Total minimum lease payments 362,138 Less: imputed interest 139,971 Present value of lease liabilities $ 222,167 As of December 27, 2020, operating lease payments exclude approximately $2.1 million of legally binding minimum lease payments for leases signed but which we have not yet taken possession. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 27, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company has outstanding awards under the Chuy's Holdings, Inc. 2006 Stock Option Plan ("the "2006" Plan), the 2012 Plan and the 2020 Plan. On July 30, 2020, the Company’s stockholders approved the 2020 Plan, which replaced the 2012 Plan and no further awards may be granted under the 2012 Plan. The termination of the 2012 Plan did not affect outstanding awards granted under the 2012 Plan. The 2006 Plan was terminated by the board effective July 27, 2012, and no further awards may be granted under the plan after such date. The termination of the 2006 Plan did not affect outstanding awards granted under the 2006 Plan. Options granted under these plans vest over five years from the date of grant and have a maximum term of ten years. As of December 27, 2020 the Company had 177,200 of stock options outstanding and exercisable with a remaining weighted average contractual term of two years. Restricted stock units granted under the 2012 and 2020 Plan vest over four Stock-based compensation cost recognized in the consolidated statements of income was approximately $3.7 million, $3.3 million and $3.1 million for the years ended December 27, 2020, December 29, 2019 and December 30, 2018, respectively. Stock-based compensation recognized as capitalized development was approximately $220,000, $215,000 and $201,000 for the years ended December 27, 2020, December 29, 2019 and December 30, 2018, respectively. Capitalized stock-based compensation is included in Property and equipment, net on the consolidated balance sheets. A summary of stock-based compensation activity and changes related to restricted stock units for the year ended December 27, 2020 are as follows: Shares Weighted Weighted Outstanding at December 29, 2019 406,205 $ 25.02 Granted 285,389 14.81 Vested (146,325) 26.16 Forfeited (26,729) 18.38 Outstanding at December 27, 2020 518,540 $ 19.42 2.42 |
Impairment, closed restaurant a
Impairment, closed restaurant and other costs | 12 Months Ended |
Dec. 27, 2020 | |
Impairment and closure costs [Abstract] | |
Impairment, Closed Restaurant and Other Costs | Impairment, Closed Restaurant And Other Costs The Company reviews long-lived assets, such as property and equipment and intangibles, subject to amortization, for impairment when events or circumstances indicate the carrying value of the assets may not be recoverable. In determining the recoverability of the asset value, an analysis is performed at the individual restaurant level and primarily includes an assessment of historical undiscounted cash flows and other relevant factors and circumstances. The Company evaluates future cash flow projections in conjunction with qualitative factors and future operating plans and regularly reviews any restaurants with a deficient level of cash flows for the previous 24 months to determine if impairment testing is necessary. Recoverability of assets to be held and used is measured by a comparison of the carrying value of the restaurant to its estimated future undiscounted cash flows. If the estimated undiscounted future cash flows are less than the carrying value, we determine if there is an impairment loss by comparing the carrying value of the restaurant to its estimated fair value. Based on this analysis, if the carrying value of the restaurant exceeds its estimated fair value, an impairment charge is recognized by the amount by which the carrying value exceeds the fair value. We make assumptions to estimate future cash flows and asset fair values. The estimated fair value is generally determined using the depreciated replacement cost method, the income approach, or discounted cash flow projections. Estimated future cash flows are highly subjective assumptions based on the Company’s projections and understanding of our business, historical operating results, and trends in sales and restaurant level operating costs. The Company’s impairment assessment process requires the use of estimates and assumptions regarding future cash flows and operating outcomes, which are based upon a significant degree of management judgment. The estimates used in the impairment analysis represent a Level 3 fair value measurement. The Company continues to assess the performance of restaurants and monitors the need for future impairment. Changes in the economic environment, real estate markets, capital spending, overall operating performance and underlying assumptions could impact these estimates and result in future impairment charges. The Company recorded impairment, closed restaurant and other costs as follows: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 Operating lease assets impairment $ 4,568 $ 480 $ — Property and equipment impairment 16,282 12,212 12,336 Total impairment charge 20,850 12,692 12,336 Closed restaurant costs 5,099 1,487 — COVID-19 related charges 845 — — Impairment, closed restaurant and other costs $ 26,794 $ 14,179 $ 12,336 During the year ended December 27, 2020, the Company recorded a $20.9 million impairment charge as a result of restaurant closures, the discontinuation of the complimentary "Nacho Car" as well as the abandoned development costs mainly driven by the COVID-19 pandemic. The Company also recorded a $0.8 million COVID-19 related charge due to idle development costs as a result of delaying restaurant openings to 2021. During the years ended December 29, 2019 and December 30, 2018, the Company recorded asset impairment charges relating to closures of underperforming restaurants. The Company also recorded $5.1 million and $1.5 million of closed restaurant costs, which include rent expense, utility and insurance costs during fiscal 2020 and 2019, respectively. |
Gain on insurance settlements
Gain on insurance settlements | 12 Months Ended |
Dec. 27, 2020 | |
Gain on insurance settlements [Abstract] | |
Gain on insurance settlements | Gain on insurance settlementsDuring the year ended December 27, 2020, the Company received a one-time insurance settlement in the amount of $1.0 million under its trade name restoration insurance policy. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 27, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provision for federal and state income taxes consisted of the following: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 Current: Federal $ (712) $ 1,151 $ 435 State 410 1,042 1,048 Total current income tax (benefit) expense (302) 2,193 1,483 Deferred: Federal (4,552) (4,676) (3,643) State (653) (418) (194) Total deferred income tax benefit (5,205) (5,094) (3,837) Total income tax benefit $ (5,507) $ (2,901) $ (2,354) Temporary differences between tax and financial reporting basis of assets and liabilities which give rise to the deferred income tax assets (liabilities) and their related tax effects are as follows: Year Ended December 27, 2020 December 29, 2019 Deferred tax assets: Accrued liabilities $ 464 $ 517 General business tax credits 23,331 17,923 Operating lease liabilities 50,714 52,773 Stock-based compensation 861 969 Other 326 230 Total deferred tax assets 75,696 72,412 Deferred tax liability: Intangibles (8,805) (8,219) Prepaid expenses (1,265) (1,330) Property and equipment (21,007) (20,526) Operating lease assets (36,813) (39,736) Total deferred tax liabilities (67,890) (69,811) Deferred tax assets, net $ 7,806 $ 2,601 Deferred tax balances were measured using a 21% federal statutory rate. As of December 27, 2020, the Company has general business tax credits of $23.3 million expiring in 2036 through 2041. Deferred tax assets are reduced by a valuation allowance if, based on the weight of the available evidence, it is more likely than not that some or all of the deferred taxes will not be realized. Both positive and negative evidence is considered in forming management’s judgment as to whether a valuation allowance is appropriate, and more weight is given to evidence that can be objectively verified. The tax benefits relating to any reversal of the valuation allowance on the deferred tax assets would be recognized as a reduction of future income tax expense. The Company believes that it will realize all of the deferred tax assets. Therefore, no valuation allowance has been recorded. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) temporarily restored the ability to carryback net operating losses (“NOL”) originating in 2018, 2019 and 2020 to offset taxable income in the five preceding years and eliminated the 80% taxable income limitation on such net operating loss deductions if utilized before 2021. Additionally, the CARES Act included an administrative correction of the depreciation recovery period for qualified improvement property ("QIP"), including certain restaurant leasehold improvement costs, that resulted in the acceleration of depreciation on these assets retroactive to 2018. The Company filed for a refund of overpaid taxes with regards to credits carried back to those years. The following is a reconciliation of the expected federal income taxes at the statutory rates of 21% for the fiscal year ended December 27, 2020, December 29, 2019 and December 30, 2018 to the actual provision for income taxes: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 Expected income tax (benefit) expense $ (1,848) $ 696 $ 669 State tax expense, net of federal benefit (192) 493 675 FICA tip credit (2,539) (3,896) (3,411) Deferred tax balance adjustment (a) (1,079) — 173 Stock compensation 344 (34) 60 Other (193) (160) (520) Income tax benefit $ (5,507) $ (2,901) $ (2,354) (a) Deferred tax balance adjustment recorded during fiscal 2020 is associated with a carryback of federal NOLs due to the CARES Act administrative correction of the deprecation recovery period for QIP. The Internal Revenue Service ("IRS") audited our tax return for the fiscal year 2016. In August 2020, the IRS issued a Notice of Proposed Adjustment to the Company asserting that the tenant allowances paid under our operating leases should be recorded as taxable income for years 2016 and prior. The Company disagrees with this position based on the underlying facts and circumstances as well as standard industry practice. The Company estimates if the IRS's position was upheld, the Company's tax liability could range between $0.5 million and $2.5 million. Federal tax standards require that a position taken or expected to be taken in a tax return be recognized in the financial statements when it is more likely than not (i.e. a likelihood of more than 50%) that the position would be sustained upon examination by tax authorities. In accordance with the standards, the Company believes that it is more likely than not that the Company's position will ultimately be sustained upon further examination, including the resolution of the IRS's appeal or litigation processes, if any. As of December 27, 2020 and December 29, 2019 the Company recognized no liability for uncertain tax positions. It is the Company’s policy to include any penalties and interest related to income taxes in its income tax provision. However, the Company currently has no penalties or interest related to income taxes. The tax years 2019, 2018 and 2017 remain open for IRS audit. The Company has received no notice of audit or any notifications from the IRS for any of the open tax years. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 27, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | ContingenciesThe Company is involved in various claims and legal actions arising in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on our condensed consolidated financial position, results of operations, or cash flows. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 27, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of consolidation The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated. Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation. These reclassifications have no effect on previously reported net income, income per share or stockholder's equity. |
Fiscal Year | Fiscal year The Company utilizes a 52- or 53-week fiscal year that ends on the last Sunday of the calendar year. The fiscal years ended December 27, 2020, December 29, 2019 and December 30, 2018 each consisted of 52 weeks. |
COVID-19 pandemic | COVID-19 pandemic During March 2020, the World Health Organization declared the COVID-19 outbreak to be a global pandemic and the United States declared a National Public Health Emergency. The COVID-19 pandemic has significantly impacted health and economic conditions throughout the United States. Federal, state and local governments took a variety of actions to contain the spread of COVID-19. Many jurisdictions where our restaurants are located required mandatory closures or imposed capacity limitations and other restrictions affecting our operations. As of December 27, 2020, the Company had reopened dining rooms at varying degrees of operating capacity in 92 of its 101 restaurants and nine restaurants remained temporarily closed. During the year-ended December 27, 2020, the Company took various steps to reduce non-essential spend, postpone restaurant development and rightsize operations in light of reduced sales volume to improve our store level profitability and increase our cash flows. The Company also enhanced its liquidity position by selling shares of its common stock in an "At-The-Market" ("ATM") offering and using a portion of the net proceeds to repay the $25.0 million outstanding under its revolving credit facility. As of December 27, 2020, the Company had $86.8 million in cash and cash equivalents, no debt and $25.0 million of availability under its revolving credit facility. Management believes the Company's strong financial position, combined with the measures taken during the pandemic, will allow the Company to meet its financial obligations over the next twelve months. We cannot predict how soon we will be able to reopen all of our restaurants at full capacity, and our ability to reopen and stay open will depend in part on the actions of a number of governmental bodies over which we have no control. Moreover, once restrictions are lifted, it is unclear how quickly customers will return to our restaurants, which may be a function of continued concerns over safety and/or depressed consumer sentiment due to adverse economic conditions, including job losses. |
Accounting Estimates | Accounting estimates The preparation of the consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the period. Actual results could differ from estimates. |
Cash and Cash Equivalents | Cash and cash equivalents The Company considers all cash and short-term investments with original maturities of three months or less as cash equivalents. Amounts receivable from credit card processors are considered cash equivalents because they are both short in term and highly liquid in nature, and are typically converted to cash within three business days of the sales transactions. |
Lease Incentives Receivable | Lease incentives receivable Lease incentives receivable consist of receivables from landlords provided for under the lease agreements to reimburse the Company for leasehold improvements. |
Inventories | Inventories Inventories consist of food, beverage, and merchandise and are stated at the lower of cost (first-in, first-out method) or net realizable value. |
Property and Equipment | Property and equipmentProperty and equipment, net are recorded at cost, less accumulated depreciation. Equipment consists primarily of restaurant equipment, furniture, fixtures and smallwares. Depreciation is calculated using the straight-line method over the estimated useful life of the related asset, which ranges from 3 to 15 years. Expenditures for major additions and improvements are capitalized. Leasehold improvements are capitalized and amortized using the straight-line method over the shorter of the lease term, including option periods that are reasonably assured of renewal, or the estimated useful life of the asset, which ranges from five |
Leases and Leasehold Improvements | Leases and leasehold improvements The Company leases land and or buildings for its corporate offices and all of its restaurants under various long-term operating lease agreements. The Company determines if a contract contains a lease at inception. The lease term begins on the date that the Company takes possession under the lease, including the pre-opening period during construction, when in many cases the Company is not making rent payments. Operating lease assets and liabilities are recognized at the lease commencement date for material leases with a term of greater than 12 months. Operating lease liabilities represent the present value of future minimum lease payments. Since our leases do not provide an implicit rate, our operating lease liabilities are calculated using the Company's secured incremental borrowing rate at lease commencement. We have no outstanding debt, and as a result, we estimate this rate based on prevailing financial market conditions, comparable companies, credit analysis and management judgment. Minimum lease payments include only fixed lease components of the agreement, as well as variable rate payments that depend on an index, initially measured using the index at the lease commencement date. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepaid or accrued lease payments, initial direct costs and lease incentives. Lease incentives are recognized when earned and reduce our operating lease asset related to the lease. They are amortized through the operating lease assets as reductions of rent expense over the lease term. Operating lease expense is recognized on a straight-line basis over the lease term. Certain of the Company’s operating leases contain clauses that provide for contingent rent based on a percentage of sales greater than certain specified target amounts. Variable lease payments that do not depend on a rate or index, escalation in the index subsequent to the initial measurement, payments associated with non-lease components such as common area maintenance, real estate taxes and insurance, and short-term lease payments (leases with less than a 12 month term) are expensed as incurred or when the achievement of the specified target that triggers the contingent rent is considered probable. |
Other Assets and Intangible Assets | Other assets and intangible assets Other assets and intangible assets include liquor licenses, lease acquisition costs and loan origination costs which are all stated at cost, less any accumulated amortization, as well as deferred compensation plan assets which are stated at fair value. |
Goodwill | GoodwillGoodwill represents the excess of cost over the fair value of assets of the businesses acquired. Goodwill is not amortized, but is subject to impairment tests at least annually. The Company performs a quantitative test to assess potential impairments at the end of the fiscal year or during the year if an event or other circumstance indicates that goodwill may be impaired. The goodwill impairment test compares the fair value of the reporting unit to the carrying amount, including goodwill. The Company considers all of its stores in total as one reporting unit. If the fair value of the reporting unit is less than the carrying amount, an impairment charge is recorded for the difference, limited to the total amount of goodwill allocated to that reporting unit. No goodwill impairment charges were recognized during 2020, 2019, or 2018. |
Indefinite Life Intangibles | Indefinite life intangibles An intangible asset is determined to have an indefinite useful life when there are no legal, regulatory, contractual, competitive, economic or other factors that may limit the period over which the asset is expected to contribute directly or indirectly to the future cash flows of the Company. Intangible assets acquired in a business combination are determined to have an indefinite useful life and are not amortized. |
Impairment of Long-Lived Assets | Impairment of long-lived assets The Company reviews long-lived assets, such as property and equipment, operating lease assets and intangibles, subject to amortization, for impairment when events or circumstances indicate the carrying value of the assets may not be recoverable. In determining the recoverability of the asset value, an analysis is performed at the individual restaurant level and primarily includes an assessment of historical undiscounted cash flows and other relevant factors and circumstances. The Company evaluates future cash flow projections in conjunction with qualitative factors and future operating plans and regularly reviews any restaurants with a deficient level of cash flows for the previous 24 months to determine if impairment testing is necessary. Recoverability of assets to be held and used is measured by a comparison of the carrying value of the restaurant to its estimated future undiscounted cash flows. If the estimated undiscounted future cash flows are less than the carrying value, we determine if there is an impairment loss by comparing the carrying value of the restaurant to its estimated fair value. Based on this analysis, if the carrying value of the restaurant exceeds its estimated fair value, an impairment charge is recognized by the amount by which the carrying value exceeds the fair value. We make assumptions to estimate future cash flows and asset fair values. The estimated fair value is generally determined using the depreciated replacement cost method, the market approach, or discounted cash flow projections. Estimated future cash flows are highly subjective assumptions based on Company’s projections and understanding of our business, historical operating results, and trends in sales and restaurant level operating costs. The Company’s impairment assessment process requires the use of estimates and assumptions regarding future cash flows and operating outcomes, which are based upon a significant degree of management judgment. The estimates used in the impairment analysis represent a Level 3 fair value measurement. The Company continues to assess the performance of restaurants and monitors the need for future impairment. Changes in the economic environment, real estate markets, capital spending, overall operating performance and underlying assumptions could impact these estimates and result in future impairment charges. |
Estimated Fair Value of Financial Instruments | Estimated fair value of financial instruments The Company uses a three-tier value hierarchy, which classifies the inputs used in measuring fair values, in determining the fair value of the Company's non-financial assets and non-financial liabilities. These tiers include: Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. There were no changes in the methods or assumptions used in measuring fair value during the period. The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable at December 27, 2020 and December 29, 2019 approximate their fair value due to the short-term maturities of these financial instruments. These inputs are categorized as Level 1 inputs. The Company provides a certain group of eligible employees the ability to participate in the Company's nonqualified deferred compensation plan. This plan allows participants to defer up to 80% of their salary and up to 100% of their bonus, on pre-tax basis, and contribute such amounts to one or more investment funds held in a rabbi trust. We report the accounts of the rabbi trust in other assets and intangible assets, net, and the corresponding liability in other liabilities on our consolidated balance sheets. The investments are considered trading securities and are reported at fair value based on quoted market prices. The deferred compensation plan assets and liabilities are measured and recorded at their fair value on recurring basis. The inputs are recognized as Level 1 inputs. The realized and unrealized gains and losses on these investments, as well as the offsetting compensation expense, are recorded in general and administrative expense in the consolidated statements of income. At December 27, 2020, the Company had approximately $0.8 million of deferred compensation plan assets and $0.9 million of deferred plan liabilities. At December 29, 2019, the Company had approximately $0.4 million of both deferred compensation plan assets and liabilities. In regards to the Company's impairment analysis, we generally estimate long-lived asset fair values, including property and equipment and leasehold improvements as well as operating lease assets and liabilities, using either depreciated replacement cost method, the market approach or discounted cash flow projections. The inputs used to determine fair value relate primarily to the assumptions regarding the long-lived assets exit cost at their highest and best use and future assumptions regarding restaurant sales and profitability. These inputs are categorized as Level 3 inputs. The inputs used represent assumptions about what information market participants would use in pricing the assets and are based upon the best information available at the time of the analysis. |
Loan Origination Costs | Loan origination costs Loan origination costs are capitalized and amortized over the term of the related debt and is included in Interest expense, net on the consolidated statements of income. |
Revenue Recognition | Revenue recognition Revenue from restaurant operations (food, beverage and alcohol sales) and merchandise sales are recognized upon satisfaction of the single performance obligation which occurs upon payment by the customer at the time of sale. Revenues are reflected net of sales tax and certain discounts and allowances. We offer our customers delivery at certain of our restaurants through third party delivery service's website or apps. We recognize this revenue when the control of the food is transferred to the delivery service, excluding any delivery fees charged to the customer. We receive payment subsequent to the transfer of food. |
Marketing | Marketing The Company expenses the printing of menus and other promotional materials as incurred. The costs of community service and sponsorship activities are expensed on the expected timing of those events. Marketing expense was $2.7 million, $5.6 million, and $3.9 million for the years ended December 27, 2020, December 29, 2019 and December 30, 2018, respectively. |
Restaurant Pre-opening Costs | Restaurant pre-opening costs Restaurant pre-opening costs consist primarily of manager salaries, relocation costs, supplies, recruiting expenses, travel and lodging, pre-opening activities, employee payroll and related training costs for employees at the new location. The Company expenses such pre-opening costs as incurred. Pre-opening costs also include rent recorded during the period between date of possession and the restaurant opening date. |
Stock-Based Compensation | Stock-based compensation The Company maintains an equity incentive plan under which the Company's board of directors can grant stock options, restricted stock units, and other equity-based awards to directors, officers, and key employees of the Company. The plan provides for granting of options to purchase shares of common stock at an exercise price not less than the fair value of the stock on the date of grant. The Company recognizes stock-based compensation in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 718 ("Topic 718"). Stock-based compensation cost includes compensation cost for all share-based payments granted based on the grant date fair value estimated in accordance with the provisions of Topic 718. Compensation cost is recognized on a straight-line basis over the requisite service period of each award. The forfeitures are recognized when they occur. |
Income Tax Matters | Income tax matters Income tax provisions are comprised of federal and state taxes currently due, plus deferred taxes. Deferred tax assets and liabilities are recognized for future tax consequences attributable to the temporary difference between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred tax assets are recognized when management considers the realization of those assets in future periods to be more likely than not. Future taxable income, adjustments in temporary differences, available carryforward periods and changes in tax laws could affect these estimates. |
Segment Reporting | Segment reporting ASC Topic No. 280, "Segment Reporting," establishes standards for disclosures about products and services, geographic areas and major customers. The Company currently operates one reporting segment; full-service, casual dining, Mexican food restaurants. Additionally, we operate in one geographic area: the United States of America. Revenue from customers is derived principally from food and beverage sales and the Company does not rely on any major customers as a source of revenue. |
Recent Accounting Pronouncements | Recent accounting pronouncements The Company's management reviewed all significant newly-issued accounting pronouncements and concluded that they either are not applicable to the Company's operations or that no material effect is expected on the Company's consolidated financial statements as a result of future adoption. |
Net (Loss) Income Per Share (Ta
Net (Loss) Income Per Share (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net (Loss) Income Per Share | The computations of basic and diluted net (loss) income per share is as follows: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 BASIC Net (loss) income $ (3,294) $ 6,215 $ 5,539 Weighted-average common shares outstanding 18,396,335 16,728,955 16,931,589 Basic net (loss) income per common share $ (0.18) $ 0.37 $ 0.33 DILUTED Net (loss) income $ (3,294) $ 6,215 $ 5,539 Weighted-average common shares outstanding 18,396,335 16,728,955 16,931,589 Dilutive effect of stock options and restricted stock units — 95,440 130,758 Weighted-average of diluted shares 18,396,335 16,824,395 17,062,347 Diluted net (loss) income per common share $ (0.18) $ 0.37 $ 0.32 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | The major classes of prepaid expenses and other current assets at December 27, 2020 and December 29, 2019 are summarized as follows: December 27, 2020 December 29, 2019 Deposits on equipment $ 418 $ 782 Prepaid expenses 2,950 2,394 Other current assets 246 200 Total prepaid expenses and other current assets $ 3,614 $ 3,376 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Property, Plant and Equipment [Abstract] | |
Major Classes of Property and Equipment | The major classes of property and equipment as of December 27, 2020 and December 29, 2019 are summarized as follows: December 27, 2020 December 29, 2019 Leasehold improvements $ 196,345 $ 205,491 Furniture, fixtures and equipment 97,149 98,895 Construction in progress 14,613 13,072 Land 1,898 1,898 310,005 319,356 Less accumulated depreciation (124,900) (108,606) Total property and equipment, net $ 185,105 $ 210,750 |
Other Assets and Other Intang_2
Other Assets and Other Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Other Assets and Other Intangible Assets [Abstract] | |
Other Assets and Other Intangible Assets | The major classes of other assets and intangibles assets along with related accumulated amortization at December 27, 2020 and December 29, 2019 are summarized as follows: Average Life at December 27, 2020 2020 2019 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Finite-lived assets: Loan origination costs 1.3 $ 410 $ (320) $ 90 $ 294 $ (267) $ 27 Total finite-lived assets 410 (320) 90 294 (267) 27 Indefinite-lived assets: Liquor license 214 — 214 214 — 214 Total indefinite-lived assets 214 — 214 214 — 214 Other noncurrent assets (1) 774 — 774 $ 426 — 426 Total other assets and intangible assets $ 1,398 $ (320) $ 1,078 $ 934 $ (267) $ 667 (1) Other noncurrent assets primarily consists of deferred compensation plan assets recorded at fair value. See Note 2 for additional information. |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Payables and Accruals [Abstract] | |
Major Classes of Accrued Liabilities | The major classes of accrued liabilities at December 27, 2020 and December 29, 2019 are summarized as follows: December 27, 2020 December 29, 2019 Accrued compensation and related benefits $ 14,007 $ 9,342 Other accruals 3,987 4,302 Property tax 3,054 2,220 Deferred gift card revenue 2,527 2,289 Sales and use tax 2,200 2,954 Total accrued liabilities $ 25,775 $ 21,107 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Leases [Abstract] | |
Components of operating lease costs | Year Ended Lease cost December 27, 2020 December 29, 2019 Operating lease cost (a) $ 26,419 $ 25,478 Variable lease cost 515 1,103 $ 26,934 $ 26,581 (a) Includes short-term operating lease costs which are immaterial. Supplemental cash flow disclosures and other lease information : Year Ended December 27, 2020 December 29, 2019 Cash paid for operating lease liabilities 23,021 25,781 Operating lease assets obtained in exchange for operating lease liabilities (a) 3,845 177,701 (a) The year-ended December 27, 2020 includes a $5.6 million reduction to the operating lease assets and liabilities mainly as a result of shortening the remaining life of certain leases as well as a $9.4 million increase due to new lease commencements. The |
Supplemental balance sheet information | Supplemental balance sheet disclosures: Operating leases Classification December 27, 2020 December 29, 2019 Right-of-use assets Operating lease assets $ 159,156 $ 169,299 Deferred Rent Payments Operating lease liability 2,169 — Current lease liabilities Operating lease liability 12,397 10,307 14,566 10,307 Deferred Rent Payments Operating lease liability, less current portion 746 — Non-current lease liabilities Operating lease liability, less current portion 206,855 214,541 207,601 214,541 Total lease liabilities $ 222,167 $ 224,848 Weighted average remaining lease term (in years) 13.8 15.0 Weighted average discount rate 7.9 % 7.8 % |
Schedule of Future Minimum Rent Payments for Operating Leases | Future minimum rent payments for our operating leases for each of the next five years as of December 27, 2020 are as follows: Fiscal years ending: 2021 $ 31,161 2022 28,775 2023 28,223 2024 26,936 2025 26,522 Thereafter 220,521 Total minimum lease payments 362,138 Less: imputed interest 139,971 Present value of lease liabilities $ 222,167 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock-Based Compensation Activity - Restricted Stock Units | A summary of stock-based compensation activity and changes related to restricted stock units for the year ended December 27, 2020 are as follows: Shares Weighted Weighted Outstanding at December 29, 2019 406,205 $ 25.02 Granted 285,389 14.81 Vested (146,325) 26.16 Forfeited (26,729) 18.38 Outstanding at December 27, 2020 518,540 $ 19.42 2.42 |
Impairment, closed restaurant_2
Impairment, closed restaurant and other costs (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Impairment and closure costs [Abstract] | |
Schedule of Impairment, Closed Restaurant and Other Costs | The Company recorded impairment, closed restaurant and other costs as follows: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 Operating lease assets impairment $ 4,568 $ 480 $ — Property and equipment impairment 16,282 12,212 12,336 Total impairment charge 20,850 12,692 12,336 Closed restaurant costs 5,099 1,487 — COVID-19 related charges 845 — — Impairment, closed restaurant and other costs $ 26,794 $ 14,179 $ 12,336 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 27, 2020 | |
Income Tax Disclosure [Abstract] | |
Provision for Federal and State Income Taxes | The provision for federal and state income taxes consisted of the following: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 Current: Federal $ (712) $ 1,151 $ 435 State 410 1,042 1,048 Total current income tax (benefit) expense (302) 2,193 1,483 Deferred: Federal (4,552) (4,676) (3,643) State (653) (418) (194) Total deferred income tax benefit (5,205) (5,094) (3,837) Total income tax benefit $ (5,507) $ (2,901) $ (2,354) |
Schedule of Deferred Tax Assets and Liabilities | Temporary differences between tax and financial reporting basis of assets and liabilities which give rise to the deferred income tax assets (liabilities) and their related tax effects are as follows: Year Ended December 27, 2020 December 29, 2019 Deferred tax assets: Accrued liabilities $ 464 $ 517 General business tax credits 23,331 17,923 Operating lease liabilities 50,714 52,773 Stock-based compensation 861 969 Other 326 230 Total deferred tax assets 75,696 72,412 Deferred tax liability: Intangibles (8,805) (8,219) Prepaid expenses (1,265) (1,330) Property and equipment (21,007) (20,526) Operating lease assets (36,813) (39,736) Total deferred tax liabilities (67,890) (69,811) Deferred tax assets, net $ 7,806 $ 2,601 |
Reconciliation of Federal Statutory Tax Expense to Effective Income Tax Expense | The following is a reconciliation of the expected federal income taxes at the statutory rates of 21% for the fiscal year ended December 27, 2020, December 29, 2019 and December 30, 2018 to the actual provision for income taxes: Year Ended December 27, 2020 December 29, 2019 December 30, 2018 Expected income tax (benefit) expense $ (1,848) $ 696 $ 669 State tax expense, net of federal benefit (192) 493 675 FICA tip credit (2,539) (3,896) (3,411) Deferred tax balance adjustment (a) (1,079) — 173 Stock compensation 344 (34) 60 Other (193) (160) (520) Income tax benefit $ (5,507) $ (2,901) $ (2,354) |
Description of Business (Detail
Description of Business (Details) | Dec. 27, 2020numberOfRestaurantState | Dec. 29, 2019numberOfRestaurant |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of States in which Entity Operates | State | 17 | |
Number of Restaurants | 101 | |
Number of Open Restaurants | 92 | 100 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Narrative) (Details) | 12 Months Ended | ||
Dec. 27, 2020USD ($)numberOfRestaurantnumberOfClosedRestaurantssegment | Dec. 29, 2019USD ($)numberOfRestaurant | Dec. 30, 2018USD ($) | |
Summary of Significant Accounting Policies | |||
Number of Open Restaurants | numberOfRestaurant | 92 | 100 | |
Number of Restaurants | numberOfRestaurant | 101 | ||
Non-Cash Impairment Charge | $ 20,850,000 | $ 12,692,000 | $ 12,336,000 |
Deferred Compensation Arrangement with Individual, Salary Deferral Allowed, Percent | 80.00% | ||
Deferred Compensation Arrangement with Individual, Bonus Deferral Allowed, Percent | 100.00% | ||
Deferred Compensation Plan Assets | $ 800,000 | 400,000 | |
Deferred Compensation Liability, Noncurrent | 900,000 | ||
Gift Card Breakage | 100,000 | 100,000 | 200,000 |
Marketing expense | $ 2,732,000 | 5,555,000 | $ 3,929,000 |
Number of Reportable Segments | segment | 1 | ||
Credit facility maximum borrowing capacity | $ 25,000,000 | ||
Closed Restaurants | numberOfClosedRestaurants | 9 | ||
Cash and cash equivalents | $ 86,817,000 | $ 10,074,000 | |
Furniture and Fixtures | Minimum | |||
Summary of Significant Accounting Policies | |||
Estimated useful life | 3 years | ||
Furniture and Fixtures | Maximum | |||
Summary of Significant Accounting Policies | |||
Estimated useful life | 15 years | ||
Leasehold Improvements | Minimum | |||
Summary of Significant Accounting Policies | |||
Estimated useful life | 5 years | ||
Leasehold Improvements | Maximum | |||
Summary of Significant Accounting Policies | |||
Estimated useful life | 20 years |
Net (Loss) Income Per Share (Co
Net (Loss) Income Per Share (Computation of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Earnings Per Share [Abstract] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 40,500 | 25,800 | 8,700 |
BASIC | |||
Net (loss) income | $ (3,294) | $ 6,215 | $ 5,539 |
Weighted-average common shares outstanding | 18,396,335 | 16,728,955 | 16,931,589 |
Basic net (loss) income per common share | $ (0.18) | $ 0.37 | $ 0.33 |
DILUTED | |||
Net (loss) income | $ (3,294) | $ 6,215 | $ 5,539 |
Weighted-average common shares outstanding | 18,396,335 | 16,728,955 | 16,931,589 |
Dilutive effect of stock options and restricted stock units | 0 | 95,440 | 130,758 |
Weighted-average of diluted shares | 18,396,335 | 16,824,395 | 17,062,347 |
Diluted net (loss) income per common share | $ (0.18) | $ 0.37 | $ 0.32 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 27, 2020 | Dec. 29, 2019 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Deposits on equipment | $ 418 | $ 782 |
Prepaid expenses | 2,950 | 2,394 |
Other current assets | 246 | 200 |
Total prepaid expenses and other current assets | $ 3,614 | $ 3,376 |
Property and Equipment (Major C
Property and Equipment (Major Classes of Property and Equipment) (Details) - USD ($) $ in Thousands | Dec. 27, 2020 | Dec. 29, 2019 |
Property, Plant and Equipment [Line Items] | ||
Leasehold improvements | $ 196,345 | $ 205,491 |
Furniture, fixtures and equipment | 97,149 | 98,895 |
Construction in progress | 14,613 | 13,072 |
Land | 1,898 | 1,898 |
Total property and equipment, gross | 310,005 | 319,356 |
Less accumulated depreciation | (124,900) | (108,606) |
Total property and equipment, net | $ 185,105 | $ 210,750 |
Other Assets and Other Intang_3
Other Assets and Other Intangible Assets (Major Classes of Other Assets and Other Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 27, 2020 | Dec. 29, 2019 | |
Other Assets and Other Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | $ 410 | $ 294 |
Finite-lived intangible assets, accumulated amortization | (320) | (267) |
Total finite-lived intangible assets, net | 90 | 27 |
Liquor license | 214 | 214 |
Other noncurrent assets | 774 | 426 |
Other assets and other intangible assets, gross | 1,398 | 934 |
Accumulated amortization, other assets and other intangible assets | (320) | (267) |
Other assets and other intangible assets, net | $ 1,078 | 667 |
Loan Origination Costs [Member] | ||
Other Assets and Other Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 1 year 3 months 18 days | |
Finite-lived intangible assets, gross | $ 410 | 294 |
Finite-lived intangible assets, accumulated amortization | (320) | (267) |
Total finite-lived intangible assets, net | 90 | 27 |
Liquor License [Member] | ||
Other Assets and Other Intangible Assets [Line Items] | ||
Liquor license | $ 214 | $ 214 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) | 12 Months Ended |
Dec. 27, 2020USD ($) | |
Credit facility maximum borrowing capacity | $ 25,000,000 |
Long-term debt | 0 |
Line of Credit Facility Additional Borrowing Capacity | 25,000,000 |
Liquidity Covenant Amount | 5,000,000 |
Revolving Credit Facility [Member] | |
Incremental Minimum Borrowing Amount | $ 5,000,000 |
Revolving Credit Facility [Member] | Federal Funds Rate [Member] | |
Basis spread on variable rate | 0.50% |
Revolving Credit Facility [Member] | Base Rate [Member] | |
Basis spread on variable rate | 1.00% |
Maximum | Revolving Credit Facility [Member] | |
Line of credit facility, covenant lease adjusted leverage ratio | 3.50 |
Minimum | Revolving Credit Facility [Member] | |
Line of credit facility, covenant lease adjusted leverage ratio | 1 |
Minimum | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) | |
Basis spread on variable rate | 1.00% |
Accrued Liabilities (Major Clas
Accrued Liabilities (Major Classes of Accrued Liabilities) (Details) - USD ($) $ in Thousands | Dec. 27, 2020 | Dec. 29, 2019 |
Payables and Accruals [Abstract] | ||
Accrued compensation and related benefits | $ 14,007 | $ 9,342 |
Other accruals | 3,987 | 4,302 |
Property tax | 3,054 | 2,220 |
Deferred gift card revenue | 2,527 | 2,289 |
Sales and use tax | 2,200 | 2,954 |
Total accrued liabilities | $ 25,775 | $ 21,107 |
Stockholders' Equity - Share Re
Stockholders' Equity - Share Repurchase Program (Details) - USD ($) | 12 Months Ended | ||||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | Oct. 31, 2019 | Oct. 26, 2017 | |
Share Repurchase Program [Abstract] | |||||
Stock Repurchase Program, Authorized Amount | $ 30,000,000 | $ 30,000,000 | |||
Repurchases of shares of common stock (in shares) | 90,144 | 351,774 | |||
Repurchase of shares of common stock | $ 1,422,000 | $ 7,793,000 | $ 3,607,000 | ||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 28,600,000 |
Stockholders Equity - ATM offer
Stockholders Equity - ATM offering (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Equity [Abstract] | |||
Sales of common stock from ATM offering, net of fees and expenses (in shares) | 3,041,256 | ||
Net Proceeds from Sale of Common Stock | $ 48,167 | $ 0 | $ 0 |
Repayments of Long-term Lines of Credit | $ (25,000) | $ (5,000) | $ 0 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 27, 2020 | Dec. 29, 2019 | |
Operating Leased Assets [Line Items] | ||
Operating Lease Payments, Minimum Lease Payments Excluded, Not Yet Taken Possession of Leases | $ 2,100 | |
Change In Operating Lease Assets and Liabilities Due to Lease Remeasurement | $ 5,600 | $ 4,300 |
Lessee, Operating Lease, Term of Contract | 20 years | |
842 Transition Adjustment | $ 170,300 | |
Deferred lease incentives | 200 | $ 900 |
Deferred Rent Credit | $ 2,900 | |
Minimum | ||
Operating Leased Assets [Line Items] | ||
Initial lease term | 10 years | |
Lease terms renewal | 10 years | |
Maximum | ||
Operating Leased Assets [Line Items] | ||
Initial lease term | 15 years | |
Lease terms renewal | 15 years |
Leases Components of Operating
Leases Components of Operating Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 27, 2020 | Dec. 29, 2019 | |
Operating Lease Costs [Abstract] | ||
Operating Lease, Cost | $ 26,419 | $ 25,478 |
Variable Lease, Cost | 515 | 1,103 |
Lease, Cost | 26,934 | 26,581 |
Change In Operating Lease Assets and Liabilities Due to Lease Commencements | 9,400 | 11,700 |
Change In Operating Lease Assets and Liabilities Due to Lease Remeasurement | $ 5,600 | $ 4,300 |
Leases Weighted average lease t
Leases Weighted average lease term and discount rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 27, 2020 | Dec. 29, 2019 | |
Leases [Abstract] | ||
Operating Lease, Payments | $ 23,021 | $ 25,781 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 3,845 | $ 177,701 |
Leases Supplemental Balance She
Leases Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Dec. 27, 2020 | Dec. 29, 2019 |
Leases [Abstract] | ||
Operating lease assets | $ 159,156 | $ 169,299 |
Deferred Rent Payments, Current | 2,169 | 0 |
Operating Lease Liability, Current Excluding Deferred Rent | 12,397 | 10,307 |
Operating lease liabilities | 14,566 | 10,307 |
Deferred Rent Payments, Noncurrent | 746 | 0 |
Operating Lease Liability, Noncurrent Excluding Deferred Rent | 206,855 | 214,541 |
Operating lease liabilities, less current portion | 207,601 | 214,541 |
Operating Lease, Liability | $ 222,167 | $ 224,848 |
Operating Lease, Weighted Average Remaining Lease Term | 13 years 9 months 18 days | 15 years |
Operating Lease, Weighted Average Discount Rate, Percent | 7.90% | 7.80% |
Leases Liability Maturity Sched
Leases Liability Maturity Schedule (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 27, 2020 | Dec. 29, 2019 | |
Leases [Abstract] | ||
Lessee, Operating Lease, Liability, Payments, Due Year One | $ 31,161 | |
Lessee, Operating Lease, Liability, to be Paid, Year Two | 28,775 | |
Lessee, Operating Lease, Liability, to be Paid, Year Three | 28,223 | |
Lessee, Operating Lease, Liability, to be Paid, Year Four | 26,936 | |
Lessee, Operating Lease, Liability, to be Paid, Year Five | 26,522 | |
Lessee, Operating Lease, Liability, to be Paid, after Year Five | 220,521 | |
Lessee, Operating Lease, Liability, to be Paid | 362,138 | |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 139,971 | |
Operating Lease, Liability | 222,167 | $ 224,848 |
Operating Lease Payments, Minimum Lease Payments Excluded, Not Yet Taken Possession of Leases | $ 2,100 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Stock-based compensation | $ 3,702 | $ 3,286 | $ 3,096 |
Share-based Payment Arrangement, Amount Capitalized | 220 | $ 215 | $ 201 |
Share-based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount | $ 7,100 | ||
2020 Omnibus Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,113,780 | ||
Share-based Payment Arrangement, Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 177,200 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 2 years | ||
Minimum | Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | ||
Maximum | Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary of Stock-Based Compensation Activity - Restricted Stock Units) (Details) | 12 Months Ended |
Dec. 27, 2020$ / sharesshares | |
Shares | |
Outstanding at December 29, 2019 | shares | 406,205 |
Granted | shares | 285,389 |
Vested | shares | (146,325) |
Forfeited | shares | (26,729) |
Outstanding at December 27, 2020 | shares | 518,540 |
Weighted Average Fair Value | |
Outstanding at December 29, 2019 | $ / shares | $ 25.02 |
Granted | $ / shares | 14.81 |
Vested | $ / shares | 26.16 |
Forfeited | $ / shares | 18.38 |
Outstanding at December 27, 2020 | $ / shares | $ 19.42 |
Weighted Average Remaining Contractual Term (Years) | 2 years 5 months 1 day |
Impairment, closed restaurant_3
Impairment, closed restaurant and other costs (Details) - USD ($) | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Impairment and closure costs [Abstract] | |||
Operating Lease, Impairment Loss | $ 4,568,000 | $ 480,000 | $ 0 |
Impairment of Long-Lived Assets Held-for-use | 16,282,000 | 12,212,000 | 12,336,000 |
Non-Cash Impairment Charge | 20,850,000 | 12,692,000 | 12,336,000 |
Closed restaurant costs | 5,099,000 | 1,487,000 | 0 |
COVID-19 related charges | 845,000 | 0 | 0 |
Impairment, closed restaurant and other costs | $ 26,794,000 | $ 14,179,000 | $ 12,336,000 |
Gain on insurance settlements (
Gain on insurance settlements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Gain on insurance settlements [Abstract] | |||
Gain on insurance settlements | $ 1,000 | $ 0 | $ 0 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 27, 2020 | Dec. 29, 2019 | |
Income Tax Contingency [Line Items] | ||
Deferred Tax Assets, Tax Credit Carryforwards, General Business | $ 23,331 | $ 17,923 |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | |
Minimum | ||
Income Tax Contingency [Line Items] | ||
Loss Contingency, Estimate of Possible Loss | $ 500 | |
Maximum | ||
Income Tax Contingency [Line Items] | ||
Loss Contingency, Estimate of Possible Loss | $ 2,500 |
Income Taxes (Provision for Fed
Income Taxes (Provision for Federal and State Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Current Income Tax Expense | |||
Federal | $ (712) | $ 1,151 | $ 435 |
State | 410 | 1,042 | 1,048 |
Total Current income tax expense | (302) | 2,193 | 1,483 |
Deferred income tax expense | |||
Federal | (4,552) | (4,676) | (3,643) |
State | (653) | (418) | (194) |
Total deferred income tax benefit | (5,205) | (5,094) | (3,837) |
Total income tax benefit | $ (5,507) | $ (2,901) | $ (2,354) |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 27, 2020 | Dec. 29, 2019 |
Deferred tax assets: | ||
Accrued liabilities | $ 464 | $ 517 |
General business credits | 23,331 | 17,923 |
Deferred Tax Assets, Tax Credit Carryforwards, Other | 50,714 | 52,773 |
Stock-based compensation | 861 | 969 |
Other | 326 | 230 |
Deferred Tax Assets, Gross | 75,696 | 72,412 |
Deferred tax liability: | ||
Intangibles | (8,805) | (8,219) |
Prepaid expenses | (1,265) | (1,330) |
Property and equipment | (21,007) | (20,526) |
Deferred Tax Liabilities, Other | (36,813) | (39,736) |
Total deferred tax liabilities | (67,890) | (69,811) |
Deferred tax asset, net | $ 7,806 | $ 2,601 |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of Federal Statutory Tax Expense to Effective Income Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 27, 2020 | Dec. 29, 2019 | Dec. 30, 2018 | |
Income Tax Disclosure [Abstract] | |||
Expected income tax expense | $ (1,848) | $ 696 | $ 669 |
State tax expense, net of federal benefit | (192) | 493 | 675 |
FICA tip credit | (2,539) | (3,896) | (3,411) |
Deferred tax balance adjustment (a) | (1,079) | 0 | 173 |
Effective Income Tax Rate Reconciliation, Tax Expense (Benefit), Share-based Payment Arrangement, Amount | (344) | 34 | (60) |
Other | (193) | (160) | (520) |
Total income tax benefit | $ (5,507) | $ (2,901) | $ (2,354) |