Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 29, 2019 | Oct. 30, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 29, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-35373 | |
Entity Registrant Name | FIESTA RESTAURANT GROUP, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 90-0712224 | |
Entity Address, Address Line One | 14800 Landmark Boulevard, Suite 500 | |
Entity Address, City or Town | Dallas | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75254 | |
City Area Code | 972 | |
Local Phone Number | 702-9300 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Entity Trading Symbol | FRGI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001534992 | |
Current Fiscal Year End Date | --12-29 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 27,476,451 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 29, 2019 | Dec. 30, 2018 |
Current assets: | ||
Cash | $ 3,509 | $ 5,258 |
Accounts receivable | 9,066 | 8,505 |
Inventories | 3,222 | 2,842 |
Prepaid rent | 119 | 3,375 |
Income tax receivable | 1,502 | 17,857 |
Prepaid expenses and other current assets | 12,378 | 6,562 |
Total current assets | 29,796 | 44,399 |
Property and equipment, net | 221,122 | 231,328 |
Operating lease right-of-use assets | 254,449 | 0 |
Goodwill | 56,307 | 123,484 |
Deferred income taxes | 8,243 | 10,383 |
Other assets | 7,685 | 9,065 |
Total assets | 577,602 | 418,659 |
Current liabilities: | ||
Current portion of long-term debt | 204 | 108 |
Accounts payable | 11,094 | 16,410 |
Accrued payroll, related taxes and benefits | 9,686 | 10,086 |
Accrued real estate taxes | 7,424 | 5,871 |
Other current liabilities | 29,842 | 14,086 |
Total current liabilities | 58,250 | 46,561 |
Long-term debt, net of current portion | 70,887 | 79,636 |
Deferred income—sale-leaseback of real estate | 0 | 19,899 |
Operating lease liabilities | 258,891 | 0 |
Other non-current liabilities | 8,066 | 32,504 |
Total liabilities | 396,094 | 178,600 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value; 20,000,000 shares authorized, no shares issued | 0 | 0 |
Common stock, $0.01 par value; 100,000,000 shares authorized, 27,480,487 and 27,259,212 shares issued, respectively, and 25,926,561 and 26,858,988 shares outstanding, respectively | 271 | 270 |
Additional paid-in capital | 172,426 | 170,290 |
Retained earnings | 22,937 | 72,268 |
Treasury stock, at cost; 1,176,895 and 112,358 shares, respectively | (14,126) | (2,769) |
Total stockholders' equity | 181,508 | 240,059 |
Total liabilities and stockholders' equity | $ 577,602 | $ 418,659 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 29, 2019 | Dec. 30, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 27,480,487 | 27,259,212 |
Common stock, shares outstanding | 25,926,561 | 26,858,988 |
Treasury stock, shares | 1,176,895 | 112,358 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 29, 2019 | Sep. 30, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | |
Revenues: | ||||
Revenues | $ 164,248 | $ 174,648 | $ 501,481 | $ 520,959 |
Costs and expenses: | ||||
Cost of sales | 52,056 | 56,021 | 156,324 | 166,275 |
Restaurant wages and related expenses (including stock-based compensation expense of $102, $6, $145, and $56, respectively) | 44,459 | 47,943 | 135,261 | 142,103 |
Restaurant rent expense | 11,970 | 9,129 | 35,613 | 26,861 |
Other restaurant operating expenses | 24,153 | 27,294 | 68,429 | 75,398 |
Advertising expense | 6,385 | 6,472 | 17,789 | 18,046 |
General and administrative (including stock-based compensation expense of $509, $732, $1,993 and $2,588, respectively) | 13,820 | 13,284 | 42,387 | 41,023 |
Depreciation and amortization | 10,165 | 9,739 | 29,520 | 27,908 |
Pre-opening costs | 77 | 223 | 863 | 1,481 |
Impairment and other lease charges | 3,254 | 6,417 | 4,667 | 6,539 |
Goodwill impairment | 21,424 | 0 | 67,909 | 0 |
Closed restaurant rent expense, net of sublease income | 726 | 0 | 3,485 | 0 |
Other expense (income), net | 64 | 47 | 920 | (3,132) |
Total operating expenses | 188,553 | 176,569 | 563,167 | 502,502 |
Income (loss) from operations | (24,305) | (1,921) | (61,686) | 18,457 |
Interest expense | 823 | 924 | 3,024 | 2,979 |
Income (loss) before income taxes | (25,128) | (2,845) | (64,710) | 15,478 |
Benefit from income taxes | (2,946) | (4,892) | (1,377) | (246) |
Net income (loss) | $ (22,182) | $ 2,047 | $ (63,333) | $ 15,724 |
Earnings (loss) per common share: | ||||
Basic (usd per share) | $ (0.84) | $ 0.08 | $ (2.37) | $ 0.58 |
Diluted (usd per share) | $ (0.84) | $ 0.08 | $ (2.37) | $ 0.58 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 26,548,116 | 26,954,285 | 26,734,822 | 26,900,716 |
Diluted (in shares) | 26,548,116 | 26,958,874 | 26,734,822 | 26,905,391 |
Restaurant sales | ||||
Revenues: | ||||
Revenues | $ 163,589 | $ 173,966 | $ 499,483 | $ 518,951 |
Franchise royalty revenues and fees | ||||
Revenues: | ||||
Revenues | $ 659 | $ 682 | $ 1,998 | $ 2,008 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 29, 2019 | Sep. 30, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | |
Stock-based compensation | $ 600 | $ 700 | $ 2,100 | $ 2,600 |
Restaurant Wages And Related Expenses | ||||
Stock-based compensation | 102 | 6 | 145 | 56 |
General and Administrative Expense | ||||
Stock-based compensation | $ 509 | $ 732 | $ 1,993 | $ 2,588 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock |
Beginning shares at Dec. 31, 2017 | 26,847,458 | ||||
Beginning balance at Dec. 31, 2017 | $ 231,516 | $ 268 | $ 166,823 | $ 64,425 | |
Increase (Decrease) in Stockholders' Equity | |||||
Stock-based compensation | 889 | 889 | |||
Vesting of restricted shares (in shares) | 76,578 | ||||
Vesting of restricted shares | 0 | $ 1 | (1) | ||
Cumulative effect of adopting a new accounting standard | 57 | 57 | |||
Purchase of treasury stock (in shares) | (18,406) | ||||
Purchase of treasury stock | (349) | $ (349) | |||
Net income (loss) | 4,184 | 4,184 | |||
Ending shares at Apr. 01, 2018 | 26,905,630 | ||||
Ending balance at Apr. 01, 2018 | 236,297 | $ 269 | 167,711 | 68,666 | (349) |
Beginning shares at Dec. 31, 2017 | 26,847,458 | ||||
Beginning balance at Dec. 31, 2017 | 231,516 | $ 268 | 166,823 | 64,425 | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | 15,724 | ||||
Ending shares at Sep. 30, 2018 | 26,865,639 | ||||
Ending balance at Sep. 30, 2018 | 247,457 | $ 270 | 169,465 | 80,206 | (2,484) |
Beginning shares at Apr. 01, 2018 | 26,905,630 | ||||
Beginning balance at Apr. 01, 2018 | 236,297 | $ 269 | 167,711 | 68,666 | (349) |
Increase (Decrease) in Stockholders' Equity | |||||
Stock-based compensation | 1,017 | 1,017 | |||
Vesting of restricted shares (in shares) | 38,348 | ||||
Vesting of restricted shares | 0 | $ 1 | (1) | ||
Purchase of treasury stock (in shares) | (24,499) | ||||
Purchase of treasury stock | (603) | (603) | |||
Net income (loss) | 9,493 | 9,493 | |||
Ending shares at Jul. 01, 2018 | 26,919,479 | ||||
Ending balance at Jul. 01, 2018 | 246,204 | $ 270 | 168,727 | 78,159 | (952) |
Increase (Decrease) in Stockholders' Equity | |||||
Stock-based compensation | 738 | 738 | |||
Vesting of restricted shares (in shares) | 613 | ||||
Vesting of restricted shares | 0 | $ 0 | 0 | ||
Purchase of treasury stock (in shares) | (54,453) | ||||
Purchase of treasury stock | (1,532) | (1,532) | |||
Net income (loss) | 2,047 | 2,047 | |||
Ending shares at Sep. 30, 2018 | 26,865,639 | ||||
Ending balance at Sep. 30, 2018 | $ 247,457 | $ 270 | 169,465 | 80,206 | (2,484) |
Beginning shares at Dec. 30, 2018 | 26,858,988 | 26,858,988 | |||
Beginning balance at Dec. 30, 2018 | $ 240,059 | $ 270 | 170,290 | 72,268 | (2,769) |
Increase (Decrease) in Stockholders' Equity | |||||
Stock-based compensation | 792 | 792 | |||
Vesting of restricted shares (in shares) | 68,286 | ||||
Vesting of restricted shares | (1) | $ 0 | (1) | ||
Cumulative effect of adopting a new accounting standard | 14,002 | 14,002 | |||
Purchase of treasury stock (in shares) | (158,269) | ||||
Purchase of treasury stock | (2,199) | (2,199) | |||
Net income (loss) | 2,289 | 2,289 | |||
Ending shares at Mar. 31, 2019 | 26,769,005 | ||||
Ending balance at Mar. 31, 2019 | $ 254,942 | $ 270 | 171,081 | 88,559 | (4,968) |
Beginning shares at Dec. 30, 2018 | 26,858,988 | 26,858,988 | |||
Beginning balance at Dec. 30, 2018 | $ 240,059 | $ 270 | 170,290 | 72,268 | (2,769) |
Increase (Decrease) in Stockholders' Equity | |||||
Purchase of treasury stock (in shares) | (1,064,537) | ||||
Purchase of treasury stock | $ (11,300) | ||||
Net income (loss) | $ (63,333) | ||||
Ending shares at Sep. 29, 2019 | 25,926,561 | 25,926,561 | |||
Ending balance at Sep. 29, 2019 | $ 181,508 | $ 271 | 172,426 | 22,937 | (14,126) |
Beginning shares at Mar. 31, 2019 | 26,769,005 | ||||
Beginning balance at Mar. 31, 2019 | 254,942 | $ 270 | 171,081 | 88,559 | (4,968) |
Increase (Decrease) in Stockholders' Equity | |||||
Stock-based compensation | 735 | 735 | |||
Vesting of restricted shares (in shares) | 57,547 | ||||
Vesting of restricted shares | 0 | $ 1 | (1) | ||
Net income (loss) | (43,440) | (43,440) | |||
Ending shares at Jun. 30, 2019 | 26,826,552 | ||||
Ending balance at Jun. 30, 2019 | 212,237 | $ 271 | 171,815 | 45,119 | (4,968) |
Increase (Decrease) in Stockholders' Equity | |||||
Stock-based compensation | 611 | 611 | |||
Vesting of restricted shares (in shares) | 6,277 | ||||
Vesting of restricted shares | 0 | $ 0 | 0 | ||
Purchase of treasury stock (in shares) | (906,268) | ||||
Purchase of treasury stock | (9,158) | (9,158) | |||
Net income (loss) | $ (22,182) | (22,182) | |||
Ending shares at Sep. 29, 2019 | 25,926,561 | 25,926,561 | |||
Ending balance at Sep. 29, 2019 | $ 181,508 | $ 271 | $ 172,426 | $ 22,937 | $ (14,126) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 29, 2019 | Sep. 30, 2018 | |
Operating activities: | ||
Net income (loss) | $ (63,333) | $ 15,724 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Loss (gain) on disposals of property and equipment | (6) | (1,167) |
Stock-based compensation | 2,138 | 2,644 |
Impairment and other lease charges | 4,667 | 6,539 |
Goodwill impairment | 67,909 | 0 |
Depreciation and amortization | 29,520 | 27,908 |
Amortization of deferred financing costs | 203 | 203 |
Amortization of deferred gains from sale-leaseback transactions | 0 | (2,698) |
Deferred income taxes | (2,112) | 7,856 |
Changes in other operating assets and liabilities | 11,988 | (12,721) |
Net cash provided by operating activities | 50,974 | 44,288 |
Capital expenditures: | ||
New restaurant development | (10,681) | (17,897) |
Restaurant remodeling | (368) | (234) |
Other restaurant capital expenditures | (15,845) | (15,536) |
Corporate and restaurant information systems | (7,179) | (6,256) |
Total capital expenditures | (34,073) | (39,923) |
Proceeds from disposals of properties | 1,774 | 4,676 |
Proceeds from insurance recoveries | 42 | 813 |
Net cash used in investing activities | (32,257) | (34,434) |
Financing activities: | ||
Borrowings on revolving credit facility | 21,000 | 18,000 |
Repayments on revolving credit facility | (30,000) | (23,000) |
Principal payments on finance/capital leases | (109) | (76) |
Financing costs associated with issuance of debt | 0 | (150) |
Payments to purchase treasury stock | (11,357) | (2,484) |
Net cash used in financing activities | (20,466) | (7,710) |
Net change in cash | (1,749) | 2,144 |
Cash, beginning of period | 5,258 | 3,599 |
Cash, end of period | 3,509 | 5,743 |
Supplemental disclosures: | ||
Interest paid on long-term debt | 3,558 | 2,505 |
Accruals for capital expenditures | 3,198 | 5,338 |
Income tax payments (refunds), net | (15,620) | (3,360) |
Finance/capital lease obligations incurred | $ 495 | $ 322 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 29, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Business Description. Fiesta Restaurant Group, Inc. ("Fiesta Restaurant Group" or "Fiesta") owns, operates and franchises two restaurant brands through its wholly-owned subsidiaries Pollo Operations, Inc. and its subsidiaries, Pollo Franchise, Inc. (collectively "Pollo Tropical"), and Taco Cabana, Inc. and its subsidiaries (collectively "Taco Cabana"). Unless the context otherwise requires, Fiesta and its subsidiaries, Pollo Tropical and Taco Cabana, are collectively referred to as the "Company." At September 29, 2019 , the Company owned and operated 141 Pollo Tropical ® restaurants and 165 Taco Cabana ® restaurants. All of the Pollo Tropical restaurants are located in Florida and all of the Taco Cabana restaurants are located in Texas. At September 29, 2019 , the Company franchised a total of 31 Pollo Tropical restaurants and eight Taco Cabana restaurants. The franchised Pollo Tropical restaurants included 17 in Puerto Rico, four in Panama, two in Guyana, one in the Bahamas, six on college campuses and one at a hospital in Florida. The franchised Taco Cabana restaurants included six in New Mexico and two on college campuses in Texas. Basis of Consolidation. The unaudited condensed consolidated financial statements presented herein reflect the consolidated financial position, results of operations and cash flows of Fiesta and its wholly-owned subsidiaries. All intercompany transactions have been eliminated in consolidation. Fiscal Year . The Company uses a 52 – 53 week fiscal year ending on the Sunday closest to December 31. The fiscal year ended December 30, 2018 contained 52 weeks. The three and nine months ended September 29, 2019 and September 30, 2018 each contained thirteen and thirty-nine weeks, respectively. The fiscal year ending December 29, 2019 will contain 52 weeks. Basis of Presentation. The accompanying unaudited condensed consolidated financial statements for the three and nine months ended September 29, 2019 and September 30, 2018 have been prepared without an audit pursuant to the rules and regulations of the Securities and Exchange Commission and do not include certain information and footnotes required by U.S. Generally Accepted Accounting Principles ("GAAP") for complete financial statements. In the opinion of management, all normal and recurring adjustments considered necessary for a fair presentation of such financial statements have been included. The results of operations for the three and nine months ended September 29, 2019 and September 30, 2018 are not necessarily indicative of the results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 30, 2018 included in the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2018 . The December 30, 2018 balance sheet data is derived from those audited financial statements. Guidance Adopted in 2019. In February 2016, and in subsequent updates, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) ("ASC 842"), which requires lessee recognition of lease assets and lease liabilities on the balance sheet and disclosure of key information about leasing arrangements. The Company adopted this new accounting standard and all the related amendments as of December 31, 2018 using the modified retrospective method, with certain optional practical expedients including the transition practical expedient package, which among other things does not require reassessment of lease classification. The Company elected the transition method that allows it to initially apply the new standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The comparative period information has not been restated and continues to be reported under the accounting standard in effect for that period. The Company has recognized lease liabilities and corresponding right-of-use ("ROU") lease assets for substantially all of the leases it previously accounted for as operating leases, including leases related to closed restaurant properties. The initial ROU assets were calculated as the present value of the remaining operating lease payments using the Company's incremental borrowing rate as of December 31, 2018, reduced by accrued occupancy costs such as certain closed-restaurant lease reserves, accrued rent (including accruals to expense operating lease payments on a straight-line basis), unamortized lease incentives and any unamortized sale-leaseback gains that resulted from off-market terms and increased by unamortized lease acquisition costs. Upon the adoption of ASC 842, the Company no longer records closed restaurant lease reserves, and ROU lease assets are reviewed for impairment with the Company's long-lived assets. The Company elected the practical expedient to combine lease and non-lease components of real estate contracts, which resulted in classification of certain occupancy related expenses that are included in other restaurant operating expenses for periods prior to the adoption of ASC 842 as restaurant rent expenses in the consolidated statement of operations for periods subsequent to the adoption of ASC 842. The Company separately presents rent expense related to its closed restaurant locations and any sublease income related to these closed restaurant locations within closed restaurant rent expense, net of sublease income in the consolidated statement of operations for periods subsequent to the adoption of ASC 842. The Company recorded an initial adjustment to the opening balance of retained earnings of $14.0 million associated with previously deferred gains on sale-leaseback transactions and impairment of operating lease right-of-use assets as of the date of adoption. This adjustment consisted of $18.6 million in deferred gains on sale-leaseback transactions, net of a related deferred tax asset of $4.3 million and $0.2 million in impairment charges, net of tax. For any future sale-leaseback transactions, the gain (adjusted for any off-market terms) will be recognized immediately. In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment ("ASU 2017-04"), which eliminates the requirement to calculate the implied fair value of goodwill if the fair value of a reporting unit is less than the carrying amount of the reporting unit. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. In 2019, the Company early adopted this new accounting standard and performed its interim impairment tests in accordance with ASU 2017-04. In the second quarter of 2019, the Company recognized a $46.5 million impairment of its Taco Cabana reporting unit goodwill, which represents the excess of the reporting unit's carrying value over its fair value at June 30, 2019. In the third quarter of 2019, the Company recognized a $21.4 million impairment of its Taco Cabana reporting unit goodwill. In the third quarter of 2019, the excess of the Taco Cabana reporting unit's carrying value over its fair value was greater than the balance of the reporting unit's goodwill, resulting in a full impairment of the Taco Cabana reporting unit's goodwill. See Note 4—Goodwill. Revenue Recognition. Revenue is recognized upon transfer of promised products or services to customers in an amount that reflects the consideration the Company received in exchange for those products or services. Revenues from the Company's owned and operated restaurants are recognized when payment is tendered at the time of sale. Franchise royalty revenues are based on a percent of gross sales and are recorded as income when earned. Initial franchise fees and area development fees associated with new franchise agreements are not distinct from the continuing rights and services offered by the Company during the term of the related franchise agreements and are recognized as income over the term of the related franchise agreements. A portion of the initial franchise fee is allocated to training services and is recognized as revenue when the Company completes the training services. Fair Value of Financial Instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. In determining fair value, the accounting standards establish a three-level hierarchy for inputs used in measuring fair value as follows: Level 1 inputs are quoted prices in active markets for identical assets or liabilities; Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities; and Level 3 inputs are unobservable and reflect management's own assumptions. The following methods were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate the fair value: • Current Assets and Liabilities. The carrying values reported on the balance sheet of cash, accounts receivable and accounts payable approximate fair value because of the short maturity of those financial instruments. • Revolving Credit Borrowings. The fair value of outstanding revolving credit borrowings under the Company's senior credit facility, which is considered Level 2, is based on current LIBOR rates. The fair value of the Company's senior credit facility was approximately $69.0 million at September 29, 2019 , and $78.0 million at December 30, 2018 . The carrying value of the Company's senior credit facility was $69.0 million at September 29, 2019 and $ 78.0 million at December 30, 2018 . Long-Lived Assets . The Company assesses the recoverability of property and equipment and definite-lived intangible assets including right-of-use lease assets by determining whether the carrying value of these assets can be recovered over their respective remaining lives through undiscounted future operating cash flows. Impairment is reviewed when events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable. See Note 3—Impairment of Long-Lived Assets. Leases. The Company assesses whether an agreement contains a lease at inception. Operating leases are included within operating lease right-of-use assets, other current liabilities, and operating lease liabilities in the consolidated balance sheets. Finance leases are included within property and equipment, net, current portion of long-term debt, and long-term debt, net of current portion in the consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The operating lease ROU asset also includes any lease payments made in advance and is reduced by lease incentives received. As most leases do not provide an implicit rate, the Company uses its incremental borrowing rate at commencement date in determining the present value of lease payments. Lease terms include options to extend the lease when it is reasonably certain that the Company will exercise that option. The Company assumes options are reasonably certain to be exercised when such options are required to achieve a minimum 20 -year lease term for new restaurant properties, and subsequent to the adoption of ASC 842, when it incurs significant leasehold improvement costs near the end of a lease term. The Company uses judgment and available data to allocate consideration in a contract when it leases land and a building. The Company also uses judgment in determining its incremental borrowing rate, which includes selecting a yield curve based on a synthetic credit rating determined using a valuation model. Lease expense for lease payments is recognized on a straight-line basis over the lease term unless the related ROU asset has been adjusted for an impairment charge. The Company has real estate lease agreements with lease and non-lease components, which are accounted for as a single lease component. See Note 6—Leases. Use of Estimates . The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements. Estimates also affect the reported amounts of expenses during the reporting periods. Significant items subject to such estimates and assumptions include: accrued occupancy costs, insurance liabilities, evaluation for impairment of goodwill and long-lived assets and lease accounting matters. Actual results could differ from those estimates. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 9 Months Ended |
Sep. 29, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets, consist of the following: September 29, 2019 December 30, 2018 Prepaid contract expenses $ 4,275 $ 4,232 Assets held for sale (1) 4,336 — Other 3,767 2,330 $ 12,378 $ 6,562 (1) One closed Pollo Tropical restaurant and two Taco Cabana restaurant properties owned by the Company were classified as held for sale as of September 29, 2019 . |
Impairment of Long-Lived Assets
Impairment of Long-Lived Assets and Other Lease Charges | 9 Months Ended |
Sep. 29, 2019 | |
Property, Plant and Equipment [Abstract] | |
Impairment of Long-Lived Assets and Other Lease Charges | Impairment of Long-Lived Assets and Other Lease Charges The Company reviews its long-lived assets, principally property and equipment and lease ROU assets, for impairment at the restaurant level. In addition to considering management's plans, known regulatory or governmental actions and damage due to acts of God (hurricanes, tornadoes, etc.), the Company considers a triggering event to have occurred related to a specific restaurant if the restaurant's cash flows for the last twelve months are less than a minimum threshold or if consistent levels of cash flows for the remaining lease period are less than the carrying value of the restaurant's assets. If an indicator of impairment exists for any of its assets, an estimate of undiscounted future cash flows over the life of the primary asset for each restaurant is compared to that long-lived asset's carrying value. If the carrying value is greater than the undiscounted cash flow, the Company then determines the fair value of the asset and if an asset is determined to be impaired, the loss is measured by the excess of the carrying amount of the asset over its fair value. There is uncertainty in the projected undiscounted future cash flows used in the Company's impairment review analysis. If actual performance does not achieve the projections, the Company may recognize impairment charges in future periods, and such charges could be material. A summary of impairment of long-lived assets and other lease charges (recoveries) recorded by segment is as follows: Three Months Ended Nine Months Ended September 29, 2019 September 30, 2018 September 29, 2019 September 30, 2018 Pollo Tropical $ 165 $ 3,295 $ (162 ) $ 3,439 Taco Cabana 3,089 3,122 4,829 3,100 $ 3,254 $ 6,417 $ 4,667 $ 6,539 Impairment and other lease charges for the three and nine months ended September 29, 2019 for Pollo Tropical include impairment charges of $0.2 million and $0.6 million , respectively, related primarily to additional impairment of equipment from previously impaired restaurants and a lease charge recoveries benefit related to previously closed restaurant lease terminations of $(0.8) million for the nine months ended September 29, 2019 . Impairment and other lease charges for the three and nine months ended September 29, 2019 for Taco Cabana include impairment charges of $3.1 million and $4.9 million , respectively, related primarily to impairment of assets for eight underperforming Taco Cabana restaurants for which continued sales declines resulted in a decrease in the estimated future cash flows and equipment from previously impaired restaurants as well as a lease charge recoveries benefit related to previously closed restaurant lease terminations of $(0.1) million for the nine months ended September 29, 2019 . Impairment and other lease charges for the three and nine months ended September 30, 2018 for Pollo Tropical include impairment charges of $3.4 million and $3.6 million , respectively, related primarily to impairment of three underperforming restaurants for which continued sales declines resulted in a decrease in the estimated future cash flows and a benefit of $(0.1) million in net lease charge recoveries related to certain previously closed restaurants due to adjustments to estimates of future lease costs. Impairment and other lease charges for the three and nine months ended September 30, 2018 for Taco Cabana include impairment charges of $2.4 million and $2.6 million , respectively, related primarily to impairment of five underperforming restaurants for which continued sales declines resulted in a decrease in the estimated future cash flows and other lease charges, net of recoveries, of $0.7 million and $0.5 million , respectively, due primarily to lease charges related to an office relocation in the third quarter of 2018 and other lease charges, net of recoveries, related to certain previously closed restaurants due to adjustments to estimates of future lease costs. The Company determined the fair value of restaurant equipment, for those restaurants reviewed for impairment, based on current economic conditions, the Company's history of using these assets in the operation of its business and the Company's expectation of how a market participant would value the assets. In addition, for those restaurants reviewed for impairment where the Company owns the land and building, the Company utilized third-party information such as a broker quoted value to determine the fair value of the property. These fair value asset measurements rely on significant unobservable inputs and are considered Level 3 in the fair value hierarchy. The Company also utilized discounted future cash flows to determine the fair value of assets for certain leased restaurants. The Level 3 assets measured at fair value associated with impairment charges recorded during the nine months ended September 29, 2019 totaled $1.5 million . |
Goodwill
Goodwill | 9 Months Ended |
Sep. 29, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The Company is required to review goodwill for impairment annually or more frequently when events and circumstances indicate that the carrying amount may be impaired. If the determined fair value of goodwill is less than the related carrying amount, an impairment loss is recognized. The Company performs its annual impairment assessment as of the last day of the fiscal year and has determined its reporting units to be its operating segments, Pollo Tropical and Taco Cabana. In performing its goodwill impairment test as of December 30, 2018, the Company compared the net book values of its reporting units to their estimated fair values, the latter determined by employing an income-based discounted cash flow analysis approach and a market-based approach, which was corroborated with other value indicators where available, such as comparable company earnings multiples. As of June 30, 2019, the Company determined that a triggering event had occurred due to a sustained decrease in the market price of the Company's common stock. In response to the triggering event, the Company performed a quantitative impairment test for both the Pollo Tropical and Taco Cabana reporting units. Fair value for each reporting unit was determined using a combination of the income-based approach and two market-based approaches. Based on the impairment test analysis, the fair value of the Pollo Tropical reporting unit substantially exceeded its carrying amount, while the carrying amount for the Taco Cabana reporting unit exceeded its estimated fair value, which indicated an impairment of the Taco Cabana reporting unit. Lower than expected profitability and a lower profitability and growth outlook for the Taco Cabana reporting unit reduced its income-based and market-based approach fair value. The Company early adopted ASU 2017-04, which eliminates Step 2 from the goodwill impairment test, and requires recognition of an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, limited to the carrying value of the reporting unit's goodwill. In the second quarter of 2019, the Company recorded an impairment charge on the goodwill of its Taco Cabana reporting unit of $46.5 million , which represents the excess of the reporting unit's carrying value over its fair value at June 30, 2019 and which was not deductible for tax purposes. In addition, in response to a further decrease in the market price of the Company's common stock and lower than expected profitability in the third quarter of 2019, the Company performed a quantitative impairment test for both the Pollo Tropical and Taco Cabana reporting units as of September 29, 2019 . Based on the impairment test analysis, which utilized the same approach used in the second quarter of 2019, the fair value of the Pollo Tropical reporting unit continued to substantially exceed its carrying amount, while the carrying amount for the Taco Cabana reporting unit exceeded its estimated fair value. In the third quarter of 2019, the Company recorded an impairment charge on the goodwill of its Taco Cabana reporting unit of $21.4 million , of which $9.1 million was deductible for tax purposes and resulted in an income tax benefit of $2.1 million . The excess of the Taco Cabana reporting unit's carrying value over its fair value was greater than the balance of the reporting unit's goodwill, resulting in a full impairment of the Taco Cabana reporting unit's goodwill. A summary of changes in goodwill during the nine months ended September 29, 2019 is as follows: Pollo Taco Total Balance, December 30, 2018 $ 56,307 $ 67,177 $ 123,484 Impairment charges (1)(2) — (67,177 ) (67,177 ) Balance, September 29, 2019 $ 56,307 $ — $ 56,307 (1) Accumulated impairment losses at September 29, 2019 were $67.2 million . There were no accumulated impairment losses at December 30, 2018 . (2) Impairment charges during the three and nine months ended September 29, 2019 include $0.7 million previously classified as an intangible asset and included in other assets. |
Other Liabilities
Other Liabilities | 9 Months Ended |
Sep. 29, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | Other Liabilities Other current liabilities consist of the following: September 29, 2019 December 30, 2018 Accrued workers' compensation and general liability claims $ 4,770 $ 4,886 Sales and property taxes 2,054 1,958 Accrued occupancy costs 1,189 4,554 Operating lease liabilities 19,647 — Other 2,182 2,688 $ 29,842 $ 14,086 Other non-current liabilities consist of the following: September 29, 2019 December 30, 2018 Accrued occupancy costs $ 78 $ 21,534 Deferred compensation 532 867 Accrued workers' compensation and general liability claims 6,806 6,808 Other 650 3,295 $ 8,066 $ 32,504 At December 30, 2018, accrued occupancy costs included obligations pertaining to closed restaurant locations and accruals to expense operating lease rental payments on a straight-line basis over the lease term. As a result of adopting ASC 842 on December 31, 2018, at September 29, 2019 , accrued occupancy costs primarily consisted of obligations pertaining to closed restaurant locations. The following table presents the activity in the closed-restaurant reserve, of which $0.1 million and $ 4.4 million are included in non-current accrued occupancy costs at September 29, 2019 and December 30, 2018 , respectively, with the remainder in current accrued occupancy costs. Nine Months Ended September 29, 2019 Year Ended December 30, 2018 Balance, beginning of period $ 8,819 $ 12,994 Provisions for restaurant closures — 2,228 Additional lease charges (recoveries), net (808 ) (152 ) Payments, net (895 ) (6,778 ) Other adjustments (1) (5,992 ) 527 Balance, end of period $ 1,124 $ 8,819 (1) As a result of adopting ASC 842 on December 31, 2018, the portion of the closed restaurant reserve related to operating lease rental payments totaling $5.7 million was reclassified and included as a component of the related ROU assets during the nine months ended September 29, 2019 . The portion of the closed restaurant reserve related to variable ancillary lease costs was not reclassified and was not included as a reduction to ROU assets. |
Leases
Leases | 9 Months Ended |
Sep. 29, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company utilizes land and buildings in its operations under various operating and finance lease agreements. The Company does not consider any one of these individual leases material to the Company's operations. Initial lease terms are generally for 20 years and, in many cases, provide for renewal options and in most cases rent escalations. As of September 29, 2019 , the Company's leases have remaining lease terms of 0.3 years to 22.1 years . Some of the Company's leases include options to extend the lease for up to 40 years . Certain leases require contingent rent, determined as a percentage of sales as defined by the terms of the applicable lease agreement. For most locations, the Company is obligated for occupancy related costs including payment of property taxes, insurance and utilities. Variable lease payments included in rent expense consist of such contingent rent, certain rent payments based on changes in an index and certain occupancy related costs, such as variable common area maintenance expense and property taxes. The Company is not subject to residual value guarantees under any of the lease agreements. Many of the Company's real estate leases contain usage restrictions, but its leases do not contain financial covenants and restrictions. Lease expense consisted of the following: Three Months Ended Nine Months Ended September 29, 2019 September 29, 2019 Operating lease cost $ 11,396 $ 34,097 Finance lease costs: Amortization of right-of-use assets $ 59 $ 136 Interest on lease liabilities 58 168 Total finance lease costs $ 117 $ 304 Variable lease costs $ 2,766 8,855 Sublease income (1,135 ) (2,764 ) Total lease costs $ 13,144 $ 40,492 Supplemental balance sheet information related to leases is as follows: September 29, 2019 Operating Leases Operating lease right-of-use assets $ 254,449 Other current liabilities $ 19,647 Operating lease liabilities 258,891 Total operating lease liabilities $ 278,538 Finance Leases Property and equipment, gross $ 2,874 Accumulated amortization (1,268 ) Property and equipment, net $ 1,606 Current portion of long-term debt $ 204 Long-term debt, net of current portion 1,887 Total finance lease liabilities $ 2,091 Weighted Average Remaining Lease Term (in Years) Operating leases 12.1 Finance leases 8.1 Weighted Average Discount Rate Operating leases 7.70 % Finance leases 12.61 % Supplemental cash flow information related to leases is as follows: Nine Months Ended September 29, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 32,833 Operating cash flows for finance leases 168 Financing cash flows for finance leases 109 Right-of-use assets obtained in exchange for lease liabilities: Operating lease ROU assets 8,618 Finance lease ROU assets 495 Right-of-use assets and lease liabilities reduced for terminated leases: Operating lease ROU assets 4,058 Operating lease liabilities 4,787 Operating lease right-of-use assets obtained and liabilities incurred as a result of adoption of ASC 842: Operating lease ROU assets 267,743 Operating lease liabilities 291,373 Maturities of lease liabilities were as follows: Operating Leases Finance Leases Remaining 2019 $ 7,369 $ 87 2020 43,570 460 2021 40,062 475 2022 38,637 475 2023 35,269 428 2024 31,820 350 Thereafter 248,237 1,278 Total lease payments 444,964 3,553 Less amount representing interest (166,426 ) (1,462 ) Total discounted lease liabilities 278,538 2,091 Less current portion (19,647 ) (204 ) Long-term portion of leases liabilities $ 258,891 $ 1,887 As of September 29, 2019 , the Company had five additional operating leases for restaurant properties. These operating leases will commence in fiscal year 2020 with each lease having an initial lease term of 15 years . Minimum rent commitments due under capital and non-cancelable operating leases at December 30, 2018 were as follows: Operating Capital 2019 $ 44,427 $ 323 2020 44,144 327 2021 41,396 342 2022 40,215 342 2023 36,587 349 Thereafter 264,704 1,646 Total minimum lease payments (1) $ 471,473 3,329 Less amount representing interest (1,585 ) Total obligations under capital leases 1,744 Less current portion (108 ) Long-term debt under capital leases $ 1,636 (1) Minimum operating lease payments include contractual rent payments for closed restaurants for which the Company is still obligated under the lease agreements and have not been reduced by minimum sublease rent of $41.4 million due in the future under non-cancelable subleases. See Note 5—Other Liabilities. The Company subleases land and buildings related to closed restaurant locations and a closed office location under various operating sublease agreements. Initial sublease terms are generally for the period of time remaining on the head lease term and, in some cases, subleases provide for renewal options and in most cases rent escalations. As of September 29, 2019 , the Company's subleases have remaining sublease terms of 2.6 years to 19.7 years . Some of the Company's subleases include options to extend the lease for up to 25 years . Variable lease payments included in sublease income consist of certain occupancy related costs, such as variable common area maintenance expense and property taxes where the Company makes the real estate payment and is reimbursed by the lessee. The sublease agreements do not include residual value guarantees. Consistent with the Company's real estate leases, many of the subleases contain usage restrictions, but its subleases do not contain financial covenants and restrictions. The undiscounted cash flows to be received under operating subleases were as follows: Operating Leases Remaining 2019 $ 937 2020 4,384 2021 4,551 2022 4,493 2023 4,481 2024 4,535 Thereafter 41,798 Total $ 65,179 |
Leases | Leases The Company utilizes land and buildings in its operations under various operating and finance lease agreements. The Company does not consider any one of these individual leases material to the Company's operations. Initial lease terms are generally for 20 years and, in many cases, provide for renewal options and in most cases rent escalations. As of September 29, 2019 , the Company's leases have remaining lease terms of 0.3 years to 22.1 years . Some of the Company's leases include options to extend the lease for up to 40 years . Certain leases require contingent rent, determined as a percentage of sales as defined by the terms of the applicable lease agreement. For most locations, the Company is obligated for occupancy related costs including payment of property taxes, insurance and utilities. Variable lease payments included in rent expense consist of such contingent rent, certain rent payments based on changes in an index and certain occupancy related costs, such as variable common area maintenance expense and property taxes. The Company is not subject to residual value guarantees under any of the lease agreements. Many of the Company's real estate leases contain usage restrictions, but its leases do not contain financial covenants and restrictions. Lease expense consisted of the following: Three Months Ended Nine Months Ended September 29, 2019 September 29, 2019 Operating lease cost $ 11,396 $ 34,097 Finance lease costs: Amortization of right-of-use assets $ 59 $ 136 Interest on lease liabilities 58 168 Total finance lease costs $ 117 $ 304 Variable lease costs $ 2,766 8,855 Sublease income (1,135 ) (2,764 ) Total lease costs $ 13,144 $ 40,492 Supplemental balance sheet information related to leases is as follows: September 29, 2019 Operating Leases Operating lease right-of-use assets $ 254,449 Other current liabilities $ 19,647 Operating lease liabilities 258,891 Total operating lease liabilities $ 278,538 Finance Leases Property and equipment, gross $ 2,874 Accumulated amortization (1,268 ) Property and equipment, net $ 1,606 Current portion of long-term debt $ 204 Long-term debt, net of current portion 1,887 Total finance lease liabilities $ 2,091 Weighted Average Remaining Lease Term (in Years) Operating leases 12.1 Finance leases 8.1 Weighted Average Discount Rate Operating leases 7.70 % Finance leases 12.61 % Supplemental cash flow information related to leases is as follows: Nine Months Ended September 29, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 32,833 Operating cash flows for finance leases 168 Financing cash flows for finance leases 109 Right-of-use assets obtained in exchange for lease liabilities: Operating lease ROU assets 8,618 Finance lease ROU assets 495 Right-of-use assets and lease liabilities reduced for terminated leases: Operating lease ROU assets 4,058 Operating lease liabilities 4,787 Operating lease right-of-use assets obtained and liabilities incurred as a result of adoption of ASC 842: Operating lease ROU assets 267,743 Operating lease liabilities 291,373 Maturities of lease liabilities were as follows: Operating Leases Finance Leases Remaining 2019 $ 7,369 $ 87 2020 43,570 460 2021 40,062 475 2022 38,637 475 2023 35,269 428 2024 31,820 350 Thereafter 248,237 1,278 Total lease payments 444,964 3,553 Less amount representing interest (166,426 ) (1,462 ) Total discounted lease liabilities 278,538 2,091 Less current portion (19,647 ) (204 ) Long-term portion of leases liabilities $ 258,891 $ 1,887 As of September 29, 2019 , the Company had five additional operating leases for restaurant properties. These operating leases will commence in fiscal year 2020 with each lease having an initial lease term of 15 years . Minimum rent commitments due under capital and non-cancelable operating leases at December 30, 2018 were as follows: Operating Capital 2019 $ 44,427 $ 323 2020 44,144 327 2021 41,396 342 2022 40,215 342 2023 36,587 349 Thereafter 264,704 1,646 Total minimum lease payments (1) $ 471,473 3,329 Less amount representing interest (1,585 ) Total obligations under capital leases 1,744 Less current portion (108 ) Long-term debt under capital leases $ 1,636 (1) Minimum operating lease payments include contractual rent payments for closed restaurants for which the Company is still obligated under the lease agreements and have not been reduced by minimum sublease rent of $41.4 million due in the future under non-cancelable subleases. See Note 5—Other Liabilities. The Company subleases land and buildings related to closed restaurant locations and a closed office location under various operating sublease agreements. Initial sublease terms are generally for the period of time remaining on the head lease term and, in some cases, subleases provide for renewal options and in most cases rent escalations. As of September 29, 2019 , the Company's subleases have remaining sublease terms of 2.6 years to 19.7 years . Some of the Company's subleases include options to extend the lease for up to 25 years . Variable lease payments included in sublease income consist of certain occupancy related costs, such as variable common area maintenance expense and property taxes where the Company makes the real estate payment and is reimbursed by the lessee. The sublease agreements do not include residual value guarantees. Consistent with the Company's real estate leases, many of the subleases contain usage restrictions, but its subleases do not contain financial covenants and restrictions. The undiscounted cash flows to be received under operating subleases were as follows: Operating Leases Remaining 2019 $ 937 2020 4,384 2021 4,551 2022 4,493 2023 4,481 2024 4,535 Thereafter 41,798 Total $ 65,179 |
Leases | Leases The Company utilizes land and buildings in its operations under various operating and finance lease agreements. The Company does not consider any one of these individual leases material to the Company's operations. Initial lease terms are generally for 20 years and, in many cases, provide for renewal options and in most cases rent escalations. As of September 29, 2019 , the Company's leases have remaining lease terms of 0.3 years to 22.1 years . Some of the Company's leases include options to extend the lease for up to 40 years . Certain leases require contingent rent, determined as a percentage of sales as defined by the terms of the applicable lease agreement. For most locations, the Company is obligated for occupancy related costs including payment of property taxes, insurance and utilities. Variable lease payments included in rent expense consist of such contingent rent, certain rent payments based on changes in an index and certain occupancy related costs, such as variable common area maintenance expense and property taxes. The Company is not subject to residual value guarantees under any of the lease agreements. Many of the Company's real estate leases contain usage restrictions, but its leases do not contain financial covenants and restrictions. Lease expense consisted of the following: Three Months Ended Nine Months Ended September 29, 2019 September 29, 2019 Operating lease cost $ 11,396 $ 34,097 Finance lease costs: Amortization of right-of-use assets $ 59 $ 136 Interest on lease liabilities 58 168 Total finance lease costs $ 117 $ 304 Variable lease costs $ 2,766 8,855 Sublease income (1,135 ) (2,764 ) Total lease costs $ 13,144 $ 40,492 Supplemental balance sheet information related to leases is as follows: September 29, 2019 Operating Leases Operating lease right-of-use assets $ 254,449 Other current liabilities $ 19,647 Operating lease liabilities 258,891 Total operating lease liabilities $ 278,538 Finance Leases Property and equipment, gross $ 2,874 Accumulated amortization (1,268 ) Property and equipment, net $ 1,606 Current portion of long-term debt $ 204 Long-term debt, net of current portion 1,887 Total finance lease liabilities $ 2,091 Weighted Average Remaining Lease Term (in Years) Operating leases 12.1 Finance leases 8.1 Weighted Average Discount Rate Operating leases 7.70 % Finance leases 12.61 % Supplemental cash flow information related to leases is as follows: Nine Months Ended September 29, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 32,833 Operating cash flows for finance leases 168 Financing cash flows for finance leases 109 Right-of-use assets obtained in exchange for lease liabilities: Operating lease ROU assets 8,618 Finance lease ROU assets 495 Right-of-use assets and lease liabilities reduced for terminated leases: Operating lease ROU assets 4,058 Operating lease liabilities 4,787 Operating lease right-of-use assets obtained and liabilities incurred as a result of adoption of ASC 842: Operating lease ROU assets 267,743 Operating lease liabilities 291,373 Maturities of lease liabilities were as follows: Operating Leases Finance Leases Remaining 2019 $ 7,369 $ 87 2020 43,570 460 2021 40,062 475 2022 38,637 475 2023 35,269 428 2024 31,820 350 Thereafter 248,237 1,278 Total lease payments 444,964 3,553 Less amount representing interest (166,426 ) (1,462 ) Total discounted lease liabilities 278,538 2,091 Less current portion (19,647 ) (204 ) Long-term portion of leases liabilities $ 258,891 $ 1,887 As of September 29, 2019 , the Company had five additional operating leases for restaurant properties. These operating leases will commence in fiscal year 2020 with each lease having an initial lease term of 15 years . Minimum rent commitments due under capital and non-cancelable operating leases at December 30, 2018 were as follows: Operating Capital 2019 $ 44,427 $ 323 2020 44,144 327 2021 41,396 342 2022 40,215 342 2023 36,587 349 Thereafter 264,704 1,646 Total minimum lease payments (1) $ 471,473 3,329 Less amount representing interest (1,585 ) Total obligations under capital leases 1,744 Less current portion (108 ) Long-term debt under capital leases $ 1,636 (1) Minimum operating lease payments include contractual rent payments for closed restaurants for which the Company is still obligated under the lease agreements and have not been reduced by minimum sublease rent of $41.4 million due in the future under non-cancelable subleases. See Note 5—Other Liabilities. The Company subleases land and buildings related to closed restaurant locations and a closed office location under various operating sublease agreements. Initial sublease terms are generally for the period of time remaining on the head lease term and, in some cases, subleases provide for renewal options and in most cases rent escalations. As of September 29, 2019 , the Company's subleases have remaining sublease terms of 2.6 years to 19.7 years . Some of the Company's subleases include options to extend the lease for up to 25 years . Variable lease payments included in sublease income consist of certain occupancy related costs, such as variable common area maintenance expense and property taxes where the Company makes the real estate payment and is reimbursed by the lessee. The sublease agreements do not include residual value guarantees. Consistent with the Company's real estate leases, many of the subleases contain usage restrictions, but its subleases do not contain financial covenants and restrictions. The undiscounted cash flows to be received under operating subleases were as follows: Operating Leases Remaining 2019 $ 937 2020 4,384 2021 4,551 2022 4,493 2023 4,481 2024 4,535 Thereafter 41,798 Total $ 65,179 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 29, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity Purchase of Treasury Stock On February 26, 2018, the Company announced that its board of directors approved a share repurchase program for up to 1,500,000 shares of the Company's common stock, and on August 7, 2019, it announced that its board of directors approved an increase to its share repurchase program of an additional 500,000 shares of the Company's common stock. Under the share repurchase program, shares may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b-18 under the Securities Exchange Act of 1934, as amended. The share repurchase program has no time limit and may be modified, suspended, superseded or terminated at any time by the Company's board of directors. The Company repurchased 1,064,537 shares of its common stock under the program in open market transactions during the nine months ended September 29, 2019 for $11.3 million . The repurchased shares are held as treasury stock at cost. Stock-Based Compensation During the nine months ended September 29, 2019 , the Company granted certain employees, non-employee directors and a consultant a total of 287,002 non-vested restricted shares under the Fiesta Restaurant Group, Inc. 2012 Stock Incentive Plan (the "Fiesta Plan"). The shares granted to employees generally vest and become non-forfeitable over a four -year vesting period. The shares granted to non-employee directors and the consultant vest and become non-forfeitable over a one - and four -year vesting period, respectively. During the three months ended September 29, 2019 , the Company granted a certain executive a total of 20,000 non-vested restricted shares under the Fiesta Plan, which vest in two tranches over a four-year vesting period. The weighted average fair value at grant date for non-vested shares issued during the nine months ended September 29, 2019 was $13.00 per share. During the nine months ended September 29, 2019 , the Company granted a certain executive a total of 15,348 restricted stock units under the Fiesta Plan, which vest in two tranches over a two -year vesting period. The restricted stock units granted to the executive are subject to continued service and attainment of specified share prices of the Company's common stock for a specified period of time within each vesting period. Each tranche vests by the end of a one-year period if the specified target stock price condition for that year is met. If the specified target stock price condition for the first tranche is not met for the year, the cumulative unearned restricted stock units will be rolled over to the subsequent tranche. For the restricted stock units granted in the nine months ended September 29, 2019 , the number of shares into which these restricted stock units convert ranges from no shares, if the service and market performance conditions are not met, to 15,348 shares, if the service and market performance conditions are met in the last vesting period. The weighted average fair value at grant date for the restricted stock units granted in the nine months ended September 29, 2019 was $1.76 per share. Stock-based compensation expense for the three and nine months ended September 29, 2019 was $0.6 million and $2.1 million , respectively, and for the three and nine months ended September 30, 2018 was $0.7 million and $2.6 million , respectively. At September 29, 2019 , the total unrecognized stock-based compensation expense related to non-vested restricted shares and restricted stock units was approximately $4.8 million . At September 29, 2019 , the remaining weighted average vesting period for non-vested restricted shares was 2.7 years and restricted stock units was 0.9 years. A summary of all non-vested restricted shares and restricted stock units activity for the nine months ended September 29, 2019 is as follows: Non-Vested Shares Restricted Stock Units Shares Weighted Units Weighted Outstanding at December 30, 2018 287,866 $ 20.70 231,112 $ 12.44 Granted 287,002 13.00 15,348 1.76 Vested and released (128,811 ) 20.34 (3,418 ) 62.05 Forfeited (69,190 ) 17.50 (95,123 ) 12.97 Outstanding at September 29, 2019 376,867 $ 15.48 147,919 $ 9.83 The fair value of the non-vested restricted shares and all other restricted stock units is based on the closing price on the date of grant. The fair value of the restricted stock units subject to market conditions was estimated using the Monte Carlo simulation method. The assumptions used to value grant restricted stock units subject to market conditions are detailed below: 2019 2018 Grant date stock price $ 14.66 $ 18.70 Fair value at grant date $ 1.76 $ 6.96 Risk free interest rate 2.53 % 2.40 % Expected term (in years) 2 3 Dividend yield — % — % Expected volatility 43.18 % 41.49 % |
Business Segment Information
Business Segment Information | 9 Months Ended |
Sep. 29, 2019 | |
Segment Reporting [Abstract] | |
Business Segment Information | Business Segment Information The Company owns, operates and franchises two restaurant brands, Pollo Tropical ® and Taco Cabana ® , each of which is an operating segment. Pollo Tropical restaurants feature fire-grilled and crispy citrus marinated chicken and other freshly prepared tropical inspired menu items, while Taco Cabana restaurants specialize in Mexican inspired food. Each segment's accounting policies are described in the summary of significant accounting policies in Note 1 to the Company's audited financial statements contained in the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2018 . The primary measure of segment profit or loss used by the chief operating decision maker to assess performance and allocate resources is Adjusted EBITDA, which is defined as earnings attributable to the applicable operating segments before interest expense, income taxes, depreciation and amortization, impairment and other lease charges, goodwill impairment, closed restaurant rent expense, net of sublease income, stock-based compensation expense, other expense (income), net, and certain significant items for each segment that management believes are related to strategic changes and/or are not related to the ongoing operation of the Company's restaurants as set forth in the reconciliation table below. The "Other" column includes corporate-related items not allocated to reportable segments and consists primarily of corporate-owned property and equipment, lease assets, miscellaneous prepaid costs, capitalized costs associated with the issuance of indebtedness, corporate cash accounts and a current income tax receivable. Three Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Restaurant sales $ 88,309 $ 75,280 $ — $ 163,589 Franchise revenue 432 227 — 659 Cost of sales 28,239 23,817 — 52,056 Restaurant wages and related expenses (1) 20,944 23,515 — 44,459 Restaurant rent expense 5,477 6,493 — 11,970 Other restaurant operating expenses 12,807 11,346 — 24,153 Advertising expense 3,130 3,255 — 6,385 General and administrative expense (2) 7,521 6,299 — 13,820 Adjusted EBITDA 10,980 1,174 — 12,154 Depreciation and amortization 5,529 4,636 — 10,165 Capital expenditures 6,402 5,015 985 12,402 September 30, 2018: Restaurant sales $ 93,592 $ 80,374 $ — $ 173,966 Franchise revenue 453 229 — 682 Cost of sales 31,219 24,802 — 56,021 Restaurant wages and related expenses (1) 21,947 25,996 — 47,943 Restaurant rent expense 4,392 4,737 — 9,129 Other restaurant operating expenses 13,521 13,773 — 27,294 Advertising expense 3,413 3,059 — 6,472 General and administrative expense (2) 7,291 5,993 — 13,284 Adjusted EBITDA 12,544 2,493 — 15,037 Depreciation and amortization 5,438 4,301 — 9,739 Capital expenditures 4,621 7,489 525 12,635 Nine Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Restaurant sales $ 271,955 $ 227,528 $ — $ 499,483 Franchise revenue 1,325 673 — 1,998 Cost of sales 85,855 70,469 — 156,324 Restaurant wages and related expenses (1) 63,387 71,874 — 135,261 Restaurant rent expense 16,393 19,220 — 35,613 Other restaurant operating expenses 36,665 31,764 — 68,429 Advertising expense 9,351 8,438 — 17,789 General and administrative expense (2) 23,568 18,819 — 42,387 Adjusted EBITDA 39,943 8,189 — 48,132 Depreciation and amortization 16,118 13,402 — 29,520 Capital expenditures 18,195 14,982 896 34,073 September 30, 2018: Restaurant sales $ 283,447 $ 235,504 $ — $ 518,951 Franchise revenue 1,376 632 — 2,008 Cost of sales 93,716 72,559 — 166,275 Restaurant wages and related expenses (1) 65,652 76,451 — 142,103 Restaurant rent expense 13,024 13,837 — 26,861 Other restaurant operating expenses 38,270 37,128 — 75,398 Advertising expense 9,859 8,187 — 18,046 General and administrative expense (2) 22,256 18,767 — 41,023 Adjusted EBITDA 42,520 9,652 — 52,172 Depreciation and amortization 16,117 11,791 — 27,908 Capital expenditures 17,656 21,400 867 39,923 Identifiable Assets: September 29, 2019 $ 348,149 $ 210,238 $ 19,215 $ 577,602 December 30, 2018 207,435 174,681 36,543 418,659 (1) Includes stock-based compensation expense of $102 and $145 for the three and nine months ended September 29, 2019 , respectively, and $6 and $56 for the three and nine months ended September 30, 2018 , respectively. (2) Includes stock-based compensation expense of $509 and $1,993 for the three and nine months ended September 29, 2019 , respectively, and $732 and $2,588 for the three and nine months ended September 30, 2018 , respectively. A reconciliation of consolidated net income to Adjusted EBITDA follows: Three Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Net loss $ (22,182 ) Benefit from income taxes (2,946 ) Income (loss) before taxes $ 3,857 $ (28,985 ) $ — $ (25,128 ) Add: Non-general and administrative expense adjustments: Depreciation and amortization 5,529 4,636 — 10,165 Impairment and other lease charges 165 3,089 — 3,254 Goodwill impairment — 21,424 — 21,424 Interest expense 398 425 — 823 Closed restaurant rent expense, net of sublease income 601 125 — 726 Other expense (income), net 5 59 — 64 Stock-based compensation expense in restaurant wages 39 63 — 102 Total non-general and administrative expense adjustments 6,737 29,821 — 36,558 General and administrative expense adjustments: Stock-based compensation expense 268 241 — 509 Digital and brand repositioning costs 118 97 — 215 Total general and administrative expense adjustments 386 338 — 724 Adjusted EBITDA $ 10,980 $ 1,174 $ — $ 12,154 September 30, 2018: Net income $ 2,047 Benefit from income taxes (4,892 ) Income (loss) before taxes $ 2,976 $ (5,821 ) $ — $ (2,845 ) Add: Non-general and administrative expense adjustments: Depreciation and amortization 5,438 4,301 — 9,739 Impairment and other lease charges 3,295 3,122 — 6,417 Interest expense 448 476 — 924 Other expense (income), net (29 ) 76 — 47 Stock-based compensation expense in restaurant wages 4 2 — 6 Total non-general and administrative expense adjustments 9,156 7,977 — 17,133 General and administrative expense adjustments: Stock-based compensation expense 407 325 — 732 Restructuring costs and retention bonuses 5 12 — 17 Total general and administrative expense adjustments 412 337 — 749 Adjusted EBITDA $ 12,544 $ 2,493 $ — $ 15,037 Nine Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Net loss $ (63,333 ) Benefit from income taxes (1,377 ) Income (loss) before taxes $ 16,731 $ (81,441 ) $ — $ (64,710 ) Add: Non-general and administrative expense adjustments: Depreciation and amortization 16,118 13,402 — 29,520 Impairment and other lease charges (162 ) 4,829 — 4,667 Goodwill impairment — 67,909 — 67,909 Interest expense 1,534 1,490 — 3,024 Closed restaurant rent expense, net of sublease income 2,784 701 — 3,485 Other expense (income), net 749 171 — 920 Stock-based compensation expense in restaurant wages 48 97 — 145 Total non-general and administrative expense adjustments 21,071 88,599 — 109,670 General and administrative expense adjustments: Stock-based compensation expense 1,196 797 — 1,993 Restructuring costs and retention bonuses 827 137 — 964 Digital and brand repositioning costs 118 97 — 215 Total general and administrative expense adjustments 2,141 1,031 — 3,172 Adjusted EBITDA $ 39,943 $ 8,189 $ — $ 48,132 September 30, 2018: Net income $ 15,724 Benefit from income taxes (246 ) Income (loss) before taxes $ 21,901 $ (6,423 ) $ — $ 15,478 Add: Non-general and administrative expense adjustments: Depreciation and amortization 16,117 11,791 — 27,908 Impairment and other lease charges 3,439 3,100 — 6,539 Interest expense 1,467 1,512 — 2,979 Other expense (income), net (1,577 ) (1,555 ) — (3,132 ) Stock-based compensation expense in restaurant wages 23 33 — 56 Total non-general and administrative expense adjustments 19,469 14,881 — 34,350 General and administrative expense adjustments: Stock-based compensation expense 1,458 1,130 — 2,588 Board and shareholder matter costs (328 ) (269 ) — (597 ) Restructuring costs and retention bonuses 187 333 — 520 Legal settlements and related costs (167 ) — — (167 ) Total general and administrative expense adjustments 1,150 1,194 — 2,344 Adjusted EBITDA $ 42,520 $ 9,652 $ — $ 52,172 |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 29, 2019 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per share ("EPS") is computed by dividing net income (loss) applicable to common shares by the weighted average number of common shares outstanding during each period. Non-vested restricted shares contain a non-forfeitable right to receive dividends on a one-to-one per share ratio to common shares and are thus considered participating securities. The impact of the participating securities is included in the computation of basic EPS pursuant to the two-class method. The two-class method of computing EPS is an earnings allocation formula that determines earnings attributable to common shares and participating securities according to dividends declared (whether paid or unpaid) and participation rights in undistributed earnings. EPS is computed by dividing undistributed earnings allocated to common stockholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, undistributed earnings are allocated to both common shares and non-vested restricted shares based on the weighted average shares outstanding during the period. Diluted EPS reflects the potential dilution that could occur if the restricted stock units were to be converted into common shares. Restricted stock units with performance conditions are only included in the diluted EPS calculation to the extent that performance conditions have been met at the measurement date. Diluted EPS is computed by adjusting the basic weighted average number of common shares by the dilutive effect of the restricted stock units, determined using the treasury stock method. For the three and nine months ended September 29, 2019 , all shares of outstanding restricted stock units were excluded from the computation of diluted EPS because including such restricted stock units would have been antidilutive as a result of the net loss in the three and nine months ended September 29, 2019 . Weighted average outstanding restricted stock units totaling 568 and 746 shares were excluded from the computation of diluted EPS for the three and nine months ended September 30, 2018 because including such restricted stock units would have been antidilutive. The computation of basic and diluted EPS is as follows: Three Months Ended Nine Months Ended September 29, 2019 September 30, 2018 September 29, 2019 September 30, 2018 Basic and diluted EPS: Net income (loss) $ (22,182 ) $ 2,047 $ (63,333 ) $ 15,724 Less: income allocated to participating securities — 23 — 171 Net income (loss) available to common shareholders $ (22,182 ) $ 2,024 $ (63,333 ) $ 15,553 Weighted average common shares—basic 26,548,116 26,954,285 26,734,822 26,900,716 Restricted stock units — 4,589 — 4,675 Weighted average common shares—diluted 26,548,116 26,958,874 26,734,822 26,905,391 Earnings (loss) per common share—basic $ (0.84 ) $ 0.08 $ (2.37 ) $ 0.58 Earnings (loss) per common share—diluted (0.84 ) 0.08 (2.37 ) 0.58 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 29, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Assignments . Taco Cabana has assigned three leases to various parties on properties where it no longer operates restaurants with lease terms expiring on various dates through 2029. The assignees are responsible for making the payments required by the leases. The Company is a guarantor under one of the leases, and it remains secondarily liable as a surety with respect to two of the leases. Pollo Tropical assigned one lease to a third party on a property where it no longer operates with a lease term expiring in 2033. The assignee is responsible for making the payments required by the lease. The Company is a guarantor under the lease. The maximum potential liability for future rental payments that the Company could be required to make under these leases at September 29, 2019 was $3.3 million . The Company could also be obligated to pay property taxes and other lease-related costs. The obligations under these leases will generally continue to decrease over time as the operating leases expire. The Company does not believe it is probable that it will be ultimately responsible for the obligations under these leases. Legal Matters . The Company is a party to various litigation matters incidental to the conduct of business. The Company does not believe that the outcome of any of these matters will have a material effect on its consolidated financial statements. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 29, 2019 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2018, the FASB issued ASU No. 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract , which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The guidance will be effective for interim and annual periods beginning after December 15, 2019. Early adoption is permitted and may be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company does not expect the standard to have a material effect on its financial statements. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 29, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Consolidation | Basis of Consolidation. The unaudited condensed consolidated financial statements presented herein reflect the consolidated financial position, results of operations and cash flows of Fiesta and its wholly-owned subsidiaries. All intercompany transactions have been eliminated in consolidation. |
Fiscal Year | Fiscal Year . The Company uses a 52 – 53 week fiscal year ending on the Sunday closest to December 31. The fiscal year ended December 30, 2018 contained 52 weeks. The three and nine months ended September 29, 2019 and September 30, 2018 each contained thirteen and thirty-nine weeks, respectively. The fiscal year ending December 29, 2019 will contain 52 weeks. |
Basis of Presentation | Basis of Presentation. The accompanying unaudited condensed consolidated financial statements for the three and nine months ended September 29, 2019 and September 30, 2018 have been prepared without an audit pursuant to the rules and regulations of the Securities and Exchange Commission and do not include certain information and footnotes required by U.S. Generally Accepted Accounting Principles ("GAAP") for complete financial statements. In the opinion of management, all normal and recurring adjustments considered necessary for a fair presentation of such financial statements have been included. The results of operations for the three and nine months ended September 29, 2019 and September 30, 2018 are not necessarily indicative of the results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 30, 2018 included in the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2018 . The December 30, 2018 balance sheet data is derived from those audited financial statements. |
Guidance Adopted in 2019 and Recent Accounting Pronouncements | Guidance Adopted in 2019. In February 2016, and in subsequent updates, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) ("ASC 842"), which requires lessee recognition of lease assets and lease liabilities on the balance sheet and disclosure of key information about leasing arrangements. The Company adopted this new accounting standard and all the related amendments as of December 31, 2018 using the modified retrospective method, with certain optional practical expedients including the transition practical expedient package, which among other things does not require reassessment of lease classification. The Company elected the transition method that allows it to initially apply the new standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The comparative period information has not been restated and continues to be reported under the accounting standard in effect for that period. The Company has recognized lease liabilities and corresponding right-of-use ("ROU") lease assets for substantially all of the leases it previously accounted for as operating leases, including leases related to closed restaurant properties. The initial ROU assets were calculated as the present value of the remaining operating lease payments using the Company's incremental borrowing rate as of December 31, 2018, reduced by accrued occupancy costs such as certain closed-restaurant lease reserves, accrued rent (including accruals to expense operating lease payments on a straight-line basis), unamortized lease incentives and any unamortized sale-leaseback gains that resulted from off-market terms and increased by unamortized lease acquisition costs. Upon the adoption of ASC 842, the Company no longer records closed restaurant lease reserves, and ROU lease assets are reviewed for impairment with the Company's long-lived assets. The Company elected the practical expedient to combine lease and non-lease components of real estate contracts, which resulted in classification of certain occupancy related expenses that are included in other restaurant operating expenses for periods prior to the adoption of ASC 842 as restaurant rent expenses in the consolidated statement of operations for periods subsequent to the adoption of ASC 842. The Company separately presents rent expense related to its closed restaurant locations and any sublease income related to these closed restaurant locations within closed restaurant rent expense, net of sublease income in the consolidated statement of operations for periods subsequent to the adoption of ASC 842. The Company recorded an initial adjustment to the opening balance of retained earnings of $14.0 million associated with previously deferred gains on sale-leaseback transactions and impairment of operating lease right-of-use assets as of the date of adoption. This adjustment consisted of $18.6 million in deferred gains on sale-leaseback transactions, net of a related deferred tax asset of $4.3 million and $0.2 million in impairment charges, net of tax. For any future sale-leaseback transactions, the gain (adjusted for any off-market terms) will be recognized immediately. In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU No. 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract , which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The guidance will be effective for interim and annual periods beginning after December 15, 2019. Early adoption is permitted and may be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company does not expect the standard to have a material effect on its financial statements. |
Revenue Recognition | Revenue Recognition. Revenue is recognized upon transfer of promised products or services to customers in an amount that reflects the consideration the Company received in exchange for those products or services. Revenues from the Company's owned and operated restaurants are recognized when payment is tendered at the time of sale. Franchise royalty revenues are based on a percent of gross sales and are recorded as income when earned. Initial franchise fees and area development fees associated with new franchise agreements are not distinct from the continuing rights and services offered by the Company during the term of the related franchise agreements and are recognized as income over the term of the related franchise agreements. A portion of the initial franchise fee is allocated to training services and is recognized as revenue when the Company completes the training services. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. In determining fair value, the accounting standards establish a three-level hierarchy for inputs used in measuring fair value as follows: Level 1 inputs are quoted prices in active markets for identical assets or liabilities; Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities; and Level 3 inputs are unobservable and reflect management's own assumptions. The following methods were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate the fair value: • Current Assets and Liabilities. The carrying values reported on the balance sheet of cash, accounts receivable and accounts payable approximate fair value because of the short maturity of those financial instruments. • Revolving Credit Borrowings. |
Long-Lived Assets | Long-Lived Assets |
Leases | Leases. The Company assesses whether an agreement contains a lease at inception. Operating leases are included within operating lease right-of-use assets, other current liabilities, and operating lease liabilities in the consolidated balance sheets. Finance leases are included within property and equipment, net, current portion of long-term debt, and long-term debt, net of current portion in the consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The operating lease ROU asset also includes any lease payments made in advance and is reduced by lease incentives received. As most leases do not provide an implicit rate, the Company uses its incremental borrowing rate at commencement date in determining the present value of lease payments. Lease terms include options to extend the lease when it is reasonably certain that the Company will exercise that option. The Company assumes options are reasonably certain to be exercised when such options are required to achieve a minimum 20 |
Use of Estimates | Use of Estimates . The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements. Estimates also affect the reported amounts of expenses during the reporting periods. Significant items subject to such estimates and assumptions include: accrued occupancy costs, insurance liabilities, evaluation for impairment of goodwill and long-lived assets and lease accounting matters. Actual results could differ from those estimates. |
Impairment of Long-Lived Assets | The Company reviews its long-lived assets, principally property and equipment and lease ROU assets, for impairment at the restaurant level. In addition to considering management's plans, known regulatory or governmental actions and damage due to acts of God (hurricanes, tornadoes, etc.), the Company considers a triggering event to have occurred related to a specific restaurant if the restaurant's cash flows for the last twelve months are less than a minimum threshold or if consistent levels of cash flows for the remaining lease period are less than the carrying value of the restaurant's assets. If an indicator of impairment exists for any of its assets, an estimate of undiscounted future cash flows over the life of the primary asset for each restaurant is compared to that long-lived asset's carrying value. If the carrying value is greater than the undiscounted cash flow, the Company then determines the fair value of the asset and if an asset is determined to be impaired, the loss is measured by the excess of the carrying amount of the asset over its fair value. There is uncertainty in the projected undiscounted future cash flows used in the Company's impairment review analysis. If actual performance does not achieve the projections, the Company may recognize impairment charges in future periods, and such charges could be material. |
Purchase of Treasury Stock | Purchase of Treasury Stock On February 26, 2018, the Company announced that its board of directors approved a share repurchase program for up to 1,500,000 shares of the Company's common stock, and on August 7, 2019, it announced that its board of directors approved an increase to its share repurchase program of an additional 500,000 shares of the Company's common stock. Under the share repurchase program, shares may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b-18 under the Securities Exchange Act of 1934, as amended. The share repurchase program has no time limit and may be modified, suspended, superseded or terminated at any time by the Company's board of directors. The Company repurchased 1,064,537 shares of its common stock under the program in open market transactions during the nine months ended September 29, 2019 for $11.3 million . The repurchased shares are held as treasury stock at cost. |
Segment Reporting | Each segment's accounting policies are described in the summary of significant accounting policies in Note 1 to the Company's audited financial statements contained in the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2018 |
Earnings per Share | Basic earnings (loss) per share ("EPS") is computed by dividing net income (loss) applicable to common shares by the weighted average number of common shares outstanding during each period. Non-vested restricted shares contain a non-forfeitable right to receive dividends on a one-to-one per share ratio to common shares and are thus considered participating securities. The impact of the participating securities is included in the computation of basic EPS pursuant to the two-class method. The two-class method of computing EPS is an earnings allocation formula that determines earnings attributable to common shares and participating securities according to dividends declared (whether paid or unpaid) and participation rights in undistributed earnings. EPS is computed by dividing undistributed earnings allocated to common stockholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, undistributed earnings are allocated to both common shares and non-vested restricted shares based on the weighted average shares outstanding during the period. |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets, consist of the following: September 29, 2019 December 30, 2018 Prepaid contract expenses $ 4,275 $ 4,232 Assets held for sale (1) 4,336 — Other 3,767 2,330 $ 12,378 $ 6,562 (1) One closed Pollo Tropical restaurant and two Taco Cabana restaurant properties owned by the Company were classified as held for sale as of September 29, 2019 . |
Impairment of Long-Lived Asse_2
Impairment of Long-Lived Assets and Other Lease Charges (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Property, Plant and Equipment [Abstract] | |
Summary of Impairment on Long-Lived Assets by Segment | A summary of impairment of long-lived assets and other lease charges (recoveries) recorded by segment is as follows: Three Months Ended Nine Months Ended September 29, 2019 September 30, 2018 September 29, 2019 September 30, 2018 Pollo Tropical $ 165 $ 3,295 $ (162 ) $ 3,439 Taco Cabana 3,089 3,122 4,829 3,100 $ 3,254 $ 6,417 $ 4,667 $ 6,539 |
Other Lease Charges (Recoveries) by Segment | A summary of impairment of long-lived assets and other lease charges (recoveries) recorded by segment is as follows: Three Months Ended Nine Months Ended September 29, 2019 September 30, 2018 September 29, 2019 September 30, 2018 Pollo Tropical $ 165 $ 3,295 $ (162 ) $ 3,439 Taco Cabana 3,089 3,122 4,829 3,100 $ 3,254 $ 6,417 $ 4,667 $ 6,539 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Changes in Goodwill | A summary of changes in goodwill during the nine months ended September 29, 2019 is as follows: Pollo Taco Total Balance, December 30, 2018 $ 56,307 $ 67,177 $ 123,484 Impairment charges (1)(2) — (67,177 ) (67,177 ) Balance, September 29, 2019 $ 56,307 $ — $ 56,307 (1) Accumulated impairment losses at September 29, 2019 were $67.2 million . There were no accumulated impairment losses at December 30, 2018 . (2) Impairment charges during the three and nine months ended September 29, 2019 include $0.7 million previously classified as an intangible asset and included in other assets. |
Other Liabilities (Tables)
Other Liabilities (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities, Current | Other current liabilities consist of the following: September 29, 2019 December 30, 2018 Accrued workers' compensation and general liability claims $ 4,770 $ 4,886 Sales and property taxes 2,054 1,958 Accrued occupancy costs 1,189 4,554 Operating lease liabilities 19,647 — Other 2,182 2,688 $ 29,842 $ 14,086 |
Other Liabilities, Non-current | Other non-current liabilities consist of the following: September 29, 2019 December 30, 2018 Accrued occupancy costs $ 78 $ 21,534 Deferred compensation 532 867 Accrued workers' compensation and general liability claims 6,806 6,808 Other 650 3,295 $ 8,066 $ 32,504 |
Activity in the Closed-Restaurant Reserve | The following table presents the activity in the closed-restaurant reserve, of which $0.1 million and $ 4.4 million are included in non-current accrued occupancy costs at September 29, 2019 and December 30, 2018 , respectively, with the remainder in current accrued occupancy costs. Nine Months Ended September 29, 2019 Year Ended December 30, 2018 Balance, beginning of period $ 8,819 $ 12,994 Provisions for restaurant closures — 2,228 Additional lease charges (recoveries), net (808 ) (152 ) Payments, net (895 ) (6,778 ) Other adjustments (1) (5,992 ) 527 Balance, end of period $ 1,124 $ 8,819 (1) As a result of adopting ASC 842 on December 31, 2018, the portion of the closed restaurant reserve related to operating lease rental payments totaling $5.7 million was reclassified and included as a component of the related ROU assets during the nine months ended September 29, 2019 . The portion of the closed restaurant reserve related to variable ancillary lease costs was not reclassified and was not included as a reduction to ROU assets. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Leases [Abstract] | |
Lease Expense | Lease expense consisted of the following: Three Months Ended Nine Months Ended September 29, 2019 September 29, 2019 Operating lease cost $ 11,396 $ 34,097 Finance lease costs: Amortization of right-of-use assets $ 59 $ 136 Interest on lease liabilities 58 168 Total finance lease costs $ 117 $ 304 Variable lease costs $ 2,766 8,855 Sublease income (1,135 ) (2,764 ) Total lease costs $ 13,144 $ 40,492 |
Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases is as follows: September 29, 2019 Operating Leases Operating lease right-of-use assets $ 254,449 Other current liabilities $ 19,647 Operating lease liabilities 258,891 Total operating lease liabilities $ 278,538 Finance Leases Property and equipment, gross $ 2,874 Accumulated amortization (1,268 ) Property and equipment, net $ 1,606 Current portion of long-term debt $ 204 Long-term debt, net of current portion 1,887 Total finance lease liabilities $ 2,091 Weighted Average Remaining Lease Term (in Years) Operating leases 12.1 Finance leases 8.1 Weighted Average Discount Rate Operating leases 7.70 % Finance leases 12.61 % |
Supplemental Cash Flow Information | Supplemental cash flow information related to leases is as follows: Nine Months Ended September 29, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 32,833 Operating cash flows for finance leases 168 Financing cash flows for finance leases 109 Right-of-use assets obtained in exchange for lease liabilities: Operating lease ROU assets 8,618 Finance lease ROU assets 495 Right-of-use assets and lease liabilities reduced for terminated leases: Operating lease ROU assets 4,058 Operating lease liabilities 4,787 Operating lease right-of-use assets obtained and liabilities incurred as a result of adoption of ASC 842: Operating lease ROU assets 267,743 Operating lease liabilities 291,373 |
Maturities of Operating Lease Liabilities | Maturities of lease liabilities were as follows: Operating Leases Finance Leases Remaining 2019 $ 7,369 $ 87 2020 43,570 460 2021 40,062 475 2022 38,637 475 2023 35,269 428 2024 31,820 350 Thereafter 248,237 1,278 Total lease payments 444,964 3,553 Less amount representing interest (166,426 ) (1,462 ) Total discounted lease liabilities 278,538 2,091 Less current portion (19,647 ) (204 ) Long-term portion of leases liabilities $ 258,891 $ 1,887 |
Maturities of Finance Lease Liabilities | Maturities of lease liabilities were as follows: Operating Leases Finance Leases Remaining 2019 $ 7,369 $ 87 2020 43,570 460 2021 40,062 475 2022 38,637 475 2023 35,269 428 2024 31,820 350 Thereafter 248,237 1,278 Total lease payments 444,964 3,553 Less amount representing interest (166,426 ) (1,462 ) Total discounted lease liabilities 278,538 2,091 Less current portion (19,647 ) (204 ) Long-term portion of leases liabilities $ 258,891 $ 1,887 |
Minimum Rent Commitments Due Under Non-Cancelable Operating Leases | Minimum rent commitments due under capital and non-cancelable operating leases at December 30, 2018 were as follows: Operating Capital 2019 $ 44,427 $ 323 2020 44,144 327 2021 41,396 342 2022 40,215 342 2023 36,587 349 Thereafter 264,704 1,646 Total minimum lease payments (1) $ 471,473 3,329 Less amount representing interest (1,585 ) Total obligations under capital leases 1,744 Less current portion (108 ) Long-term debt under capital leases $ 1,636 (1) Minimum operating lease payments include contractual rent payments for closed restaurants for which the Company is still obligated under the lease agreements and have not been reduced by minimum sublease rent of $41.4 million due in the future under non-cancelable subleases. See Note 5—Other Liabilities. |
Minimum Rent Commitments Due Under Capital Leases | Minimum rent commitments due under capital and non-cancelable operating leases at December 30, 2018 were as follows: Operating Capital 2019 $ 44,427 $ 323 2020 44,144 327 2021 41,396 342 2022 40,215 342 2023 36,587 349 Thereafter 264,704 1,646 Total minimum lease payments (1) $ 471,473 3,329 Less amount representing interest (1,585 ) Total obligations under capital leases 1,744 Less current portion (108 ) Long-term debt under capital leases $ 1,636 (1) Minimum operating lease payments include contractual rent payments for closed restaurants for which the Company is still obligated under the lease agreements and have not been reduced by minimum sublease rent of $41.4 million due in the future under non-cancelable subleases. See Note 5—Other Liabilities. |
Undiscounted Cash Flows to be Received Under Operating Subleases | The undiscounted cash flows to be received under operating subleases were as follows: Operating Leases Remaining 2019 $ 937 2020 4,384 2021 4,551 2022 4,493 2023 4,481 2024 4,535 Thereafter 41,798 Total $ 65,179 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Equity [Abstract] | |
Schedule of Non-vested Restricted Shares and Restricted Stock Units Activity | A summary of all non-vested restricted shares and restricted stock units activity for the nine months ended September 29, 2019 is as follows: Non-Vested Shares Restricted Stock Units Shares Weighted Units Weighted Outstanding at December 30, 2018 287,866 $ 20.70 231,112 $ 12.44 Granted 287,002 13.00 15,348 1.76 Vested and released (128,811 ) 20.34 (3,418 ) 62.05 Forfeited (69,190 ) 17.50 (95,123 ) 12.97 Outstanding at September 29, 2019 376,867 $ 15.48 147,919 $ 9.83 |
Restricted Stock Units Subject to Market Conditions Assumptions | The assumptions used to value grant restricted stock units subject to market conditions are detailed below: 2019 2018 Grant date stock price $ 14.66 $ 18.70 Fair value at grant date $ 1.76 $ 6.96 Risk free interest rate 2.53 % 2.40 % Expected term (in years) 2 3 Dividend yield — % — % Expected volatility 43.18 % 41.49 % |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Three Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Restaurant sales $ 88,309 $ 75,280 $ — $ 163,589 Franchise revenue 432 227 — 659 Cost of sales 28,239 23,817 — 52,056 Restaurant wages and related expenses (1) 20,944 23,515 — 44,459 Restaurant rent expense 5,477 6,493 — 11,970 Other restaurant operating expenses 12,807 11,346 — 24,153 Advertising expense 3,130 3,255 — 6,385 General and administrative expense (2) 7,521 6,299 — 13,820 Adjusted EBITDA 10,980 1,174 — 12,154 Depreciation and amortization 5,529 4,636 — 10,165 Capital expenditures 6,402 5,015 985 12,402 September 30, 2018: Restaurant sales $ 93,592 $ 80,374 $ — $ 173,966 Franchise revenue 453 229 — 682 Cost of sales 31,219 24,802 — 56,021 Restaurant wages and related expenses (1) 21,947 25,996 — 47,943 Restaurant rent expense 4,392 4,737 — 9,129 Other restaurant operating expenses 13,521 13,773 — 27,294 Advertising expense 3,413 3,059 — 6,472 General and administrative expense (2) 7,291 5,993 — 13,284 Adjusted EBITDA 12,544 2,493 — 15,037 Depreciation and amortization 5,438 4,301 — 9,739 Capital expenditures 4,621 7,489 525 12,635 Nine Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Restaurant sales $ 271,955 $ 227,528 $ — $ 499,483 Franchise revenue 1,325 673 — 1,998 Cost of sales 85,855 70,469 — 156,324 Restaurant wages and related expenses (1) 63,387 71,874 — 135,261 Restaurant rent expense 16,393 19,220 — 35,613 Other restaurant operating expenses 36,665 31,764 — 68,429 Advertising expense 9,351 8,438 — 17,789 General and administrative expense (2) 23,568 18,819 — 42,387 Adjusted EBITDA 39,943 8,189 — 48,132 Depreciation and amortization 16,118 13,402 — 29,520 Capital expenditures 18,195 14,982 896 34,073 September 30, 2018: Restaurant sales $ 283,447 $ 235,504 $ — $ 518,951 Franchise revenue 1,376 632 — 2,008 Cost of sales 93,716 72,559 — 166,275 Restaurant wages and related expenses (1) 65,652 76,451 — 142,103 Restaurant rent expense 13,024 13,837 — 26,861 Other restaurant operating expenses 38,270 37,128 — 75,398 Advertising expense 9,859 8,187 — 18,046 General and administrative expense (2) 22,256 18,767 — 41,023 Adjusted EBITDA 42,520 9,652 — 52,172 Depreciation and amortization 16,117 11,791 — 27,908 Capital expenditures 17,656 21,400 867 39,923 Identifiable Assets: September 29, 2019 $ 348,149 $ 210,238 $ 19,215 $ 577,602 December 30, 2018 207,435 174,681 36,543 418,659 (1) Includes stock-based compensation expense of $102 and $145 for the three and nine months ended September 29, 2019 , respectively, and $6 and $56 for the three and nine months ended September 30, 2018 , respectively. (2) Includes stock-based compensation expense of $509 and $1,993 for the three and nine months ended September 29, 2019 , respectively, and $732 and $2,588 for the three and nine months ended September 30, 2018 , respectively. |
Reconciliation of Consolidated Net Income (Loss) to Adjusted EBITDA | A reconciliation of consolidated net income to Adjusted EBITDA follows: Three Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Net loss $ (22,182 ) Benefit from income taxes (2,946 ) Income (loss) before taxes $ 3,857 $ (28,985 ) $ — $ (25,128 ) Add: Non-general and administrative expense adjustments: Depreciation and amortization 5,529 4,636 — 10,165 Impairment and other lease charges 165 3,089 — 3,254 Goodwill impairment — 21,424 — 21,424 Interest expense 398 425 — 823 Closed restaurant rent expense, net of sublease income 601 125 — 726 Other expense (income), net 5 59 — 64 Stock-based compensation expense in restaurant wages 39 63 — 102 Total non-general and administrative expense adjustments 6,737 29,821 — 36,558 General and administrative expense adjustments: Stock-based compensation expense 268 241 — 509 Digital and brand repositioning costs 118 97 — 215 Total general and administrative expense adjustments 386 338 — 724 Adjusted EBITDA $ 10,980 $ 1,174 $ — $ 12,154 September 30, 2018: Net income $ 2,047 Benefit from income taxes (4,892 ) Income (loss) before taxes $ 2,976 $ (5,821 ) $ — $ (2,845 ) Add: Non-general and administrative expense adjustments: Depreciation and amortization 5,438 4,301 — 9,739 Impairment and other lease charges 3,295 3,122 — 6,417 Interest expense 448 476 — 924 Other expense (income), net (29 ) 76 — 47 Stock-based compensation expense in restaurant wages 4 2 — 6 Total non-general and administrative expense adjustments 9,156 7,977 — 17,133 General and administrative expense adjustments: Stock-based compensation expense 407 325 — 732 Restructuring costs and retention bonuses 5 12 — 17 Total general and administrative expense adjustments 412 337 — 749 Adjusted EBITDA $ 12,544 $ 2,493 $ — $ 15,037 Nine Months Ended Pollo Tropical Taco Cabana Other Consolidated September 29, 2019: Net loss $ (63,333 ) Benefit from income taxes (1,377 ) Income (loss) before taxes $ 16,731 $ (81,441 ) $ — $ (64,710 ) Add: Non-general and administrative expense adjustments: Depreciation and amortization 16,118 13,402 — 29,520 Impairment and other lease charges (162 ) 4,829 — 4,667 Goodwill impairment — 67,909 — 67,909 Interest expense 1,534 1,490 — 3,024 Closed restaurant rent expense, net of sublease income 2,784 701 — 3,485 Other expense (income), net 749 171 — 920 Stock-based compensation expense in restaurant wages 48 97 — 145 Total non-general and administrative expense adjustments 21,071 88,599 — 109,670 General and administrative expense adjustments: Stock-based compensation expense 1,196 797 — 1,993 Restructuring costs and retention bonuses 827 137 — 964 Digital and brand repositioning costs 118 97 — 215 Total general and administrative expense adjustments 2,141 1,031 — 3,172 Adjusted EBITDA $ 39,943 $ 8,189 $ — $ 48,132 September 30, 2018: Net income $ 15,724 Benefit from income taxes (246 ) Income (loss) before taxes $ 21,901 $ (6,423 ) $ — $ 15,478 Add: Non-general and administrative expense adjustments: Depreciation and amortization 16,117 11,791 — 27,908 Impairment and other lease charges 3,439 3,100 — 6,539 Interest expense 1,467 1,512 — 2,979 Other expense (income), net (1,577 ) (1,555 ) — (3,132 ) Stock-based compensation expense in restaurant wages 23 33 — 56 Total non-general and administrative expense adjustments 19,469 14,881 — 34,350 General and administrative expense adjustments: Stock-based compensation expense 1,458 1,130 — 2,588 Board and shareholder matter costs (328 ) (269 ) — (597 ) Restructuring costs and retention bonuses 187 333 — 520 Legal settlements and related costs (167 ) — — (167 ) Total general and administrative expense adjustments 1,150 1,194 — 2,344 Adjusted EBITDA $ 42,520 $ 9,652 $ — $ 52,172 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 29, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings (Loss) Per Share | The computation of basic and diluted EPS is as follows: Three Months Ended Nine Months Ended September 29, 2019 September 30, 2018 September 29, 2019 September 30, 2018 Basic and diluted EPS: Net income (loss) $ (22,182 ) $ 2,047 $ (63,333 ) $ 15,724 Less: income allocated to participating securities — 23 — 171 Net income (loss) available to common shareholders $ (22,182 ) $ 2,024 $ (63,333 ) $ 15,553 Weighted average common shares—basic 26,548,116 26,954,285 26,734,822 26,900,716 Restricted stock units — 4,589 — 4,675 Weighted average common shares—diluted 26,548,116 26,958,874 26,734,822 26,905,391 Earnings (loss) per common share—basic $ (0.84 ) $ 0.08 $ (2.37 ) $ 0.58 Earnings (loss) per common share—diluted (0.84 ) 0.08 (2.37 ) 0.58 |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) | 9 Months Ended |
Sep. 29, 2019segmentrestaurant | |
Entity Information [Line Items] | |
Number of operating segments | segment | 2 |
Minimum | |
Entity Information [Line Items] | |
Lease term | 20 years |
Entity Operated Units | Pollo Tropical | |
Entity Information [Line Items] | |
Number of restaurants | 141 |
Entity Operated Units | Taco Cabana | |
Entity Information [Line Items] | |
Number of restaurants | 165 |
Franchised Units | Pollo Tropical | |
Entity Information [Line Items] | |
Number of restaurants | 31 |
Franchised Units | Pollo Tropical | Puerto Rico | |
Entity Information [Line Items] | |
Number of restaurants | 17 |
Franchised Units | Pollo Tropical | Panama | |
Entity Information [Line Items] | |
Number of restaurants | 4 |
Franchised Units | Pollo Tropical | Guyana | |
Entity Information [Line Items] | |
Number of restaurants | 2 |
Franchised Units | Pollo Tropical | Bahamas | |
Entity Information [Line Items] | |
Number of restaurants | 1 |
Franchised Units | Pollo Tropical | Florida | College Campus | |
Entity Information [Line Items] | |
Number of restaurants | 6 |
Franchised Units | Pollo Tropical | Florida | Hospital | |
Entity Information [Line Items] | |
Number of restaurants | 1 |
Franchised Units | Taco Cabana | |
Entity Information [Line Items] | |
Number of restaurants | 8 |
Franchised Units | Taco Cabana | New Mexico | |
Entity Information [Line Items] | |
Number of restaurants | 6 |
Franchised Units | Taco Cabana | Texas | |
Entity Information [Line Items] | |
Number of restaurants | 2 |
Basis of Presentation - Guidanc
Basis of Presentation - Guidance Adopted in 2019 (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 29, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 30, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Cumulative effect adjustment to retained earnings | $ 22,937 | $ 22,937 | $ 72,268 | ||||
Deferred gains on sale-leaseback transactions | 0 | 0 | $ 19,899 | ||||
Goodwill impairment | 21,424 | $ 0 | $ 67,909 | $ 0 | |||
ASU 2016-02 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Cumulative effect adjustment to retained earnings | $ 14,000 | ||||||
Deferred gains on sale-leaseback transactions | 18,600 | ||||||
Deferred tax asset related to sale-leaseback transactions | 4,300 | ||||||
Impairment charges related to sale-leaseback transactions | $ 200 | ||||||
ASU 2017-04 | New Accounting Pronouncement, Early Adoption, Effect | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Goodwill impairment | $ 21,400 | $ 46,500 |
Basis of Presentation - Fair Va
Basis of Presentation - Fair Value Disclosures (Details) - USD ($) $ in Millions | Sep. 29, 2019 | Dec. 30, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying value of senior credit facility | $ 69 | $ 78 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of senior credit facility | $ 69 | $ 78 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) $ in Thousands | Sep. 29, 2019USD ($)restaurant | Dec. 30, 2018USD ($) |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid contract expenses | $ 4,275 | $ 4,232 |
Assets held for sale | 4,336 | 0 |
Other | 3,767 | 2,330 |
Prepaid expenses and other current assets | $ 12,378 | $ 6,562 |
Pollo Tropical | ||
Property, Plant and Equipment [Line Items] | ||
Restaurant properties classified as held for sale | restaurant | 1 | |
Taco Cabana | ||
Property, Plant and Equipment [Line Items] | ||
Restaurant properties classified as held for sale | restaurant | 2 |
Impairment of Long-Lived Asse_3
Impairment of Long-Lived Assets and Other Lease Charges - Summary by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 29, 2019 | Sep. 30, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | |
Impairment and Other Lease Charges [Line Items] | ||||
Impairment and other lease charges | $ 3,254 | $ 6,417 | $ 4,667 | $ 6,539 |
Pollo Tropical | ||||
Impairment and Other Lease Charges [Line Items] | ||||
Impairment and other lease charges | 165 | 3,295 | (162) | 3,439 |
Taco Cabana | ||||
Impairment and Other Lease Charges [Line Items] | ||||
Impairment and other lease charges | $ 3,089 | $ 3,122 | $ 4,829 | $ 3,100 |
Impairment of Long-Lived Asse_4
Impairment of Long-Lived Assets and Other Lease Charges - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 29, 2019USD ($)restaurant | Sep. 30, 2018USD ($)restaurant | Sep. 29, 2019USD ($)restaurant | Sep. 30, 2018USD ($)restaurant | |
Level 3 | ||||
Impairment and Other Lease Charges [Line Items] | ||||
Assets measured at fair value associated with impairment charges | $ 1.5 | $ 1.5 | ||
Pollo Tropical | ||||
Impairment and Other Lease Charges [Line Items] | ||||
Impairment charges | 0.2 | $ 3.4 | 0.6 | $ 3.6 |
Lease charge (recoveries) | $ (0.1) | (0.8) | $ (0.1) | |
Number of underperforming restaurants | restaurant | 3 | 3 | ||
Taco Cabana | ||||
Impairment and Other Lease Charges [Line Items] | ||||
Impairment charges | $ 3.1 | $ 2.4 | 4.9 | $ 2.6 |
Lease charge (recoveries) | $ 0.7 | $ (0.1) | $ 0.5 | |
Number of underperforming restaurants | restaurant | 8 | 5 | 8 | 5 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 29, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | |
Goodwill [Line Items] | |||||
Impairment charge on goodwill | $ 21,424 | $ 0 | $ 67,909 | $ 0 | |
Taco Cabana | |||||
Goodwill [Line Items] | |||||
Impairment charge on goodwill | $ 67,177 | ||||
New Accounting Pronouncement, Early Adoption, Effect | ASU 2017-04 | |||||
Goodwill [Line Items] | |||||
Impairment charge on goodwill | 21,400 | $ 46,500 | |||
Goodwill impairment loss deductible for tax purposes | 9,100 | ||||
Goodwill impairment loss, income tax benefit | $ 2,100 |
Goodwill - Summary of Changes i
Goodwill - Summary of Changes in Goodwill (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 29, 2019 | Sep. 30, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | Dec. 30, 2018 | |
Goodwill | |||||
Balance, December 30, 2018 | $ 123,484,000 | ||||
Goodwill impairment | $ 21,424,000 | $ 0 | 67,909,000 | $ 0 | |
Balance, September 29, 2019 | 56,307,000 | 56,307,000 | |||
Accumulated impairment loss | 67,200,000 | 67,200,000 | $ 0 | ||
Impairment loss for asset previously classified as intangible asset and included in other assets | 700,000 | 700,000 | |||
Pollo Tropical | |||||
Goodwill | |||||
Balance, December 30, 2018 | 56,307,000 | ||||
Goodwill impairment | 0 | ||||
Balance, September 29, 2019 | 56,307,000 | 56,307,000 | |||
Taco Cabana | |||||
Goodwill | |||||
Balance, December 30, 2018 | 67,177,000 | ||||
Goodwill impairment | 67,177,000 | ||||
Balance, September 29, 2019 | $ 0 | $ 0 |
Other Liabilities - Current (De
Other Liabilities - Current (Details) - USD ($) $ in Thousands | Sep. 29, 2019 | Dec. 30, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Accrued workers' compensation and general liability claims | $ 4,770 | $ 4,886 |
Sales and property taxes | 2,054 | 1,958 |
Accrued occupancy costs | 1,189 | 4,554 |
Operating lease liabilities | 19,647 | 0 |
Other | 2,182 | 2,688 |
Other current liabilities | $ 29,842 | $ 14,086 |
Other Liabilities - Non-current
Other Liabilities - Non-current (Details) - USD ($) $ in Thousands | Sep. 29, 2019 | Dec. 30, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Accrued occupancy costs | $ 78 | $ 21,534 |
Deferred compensation | 532 | 867 |
Accrued workers' compensation and general liability claims | 6,806 | 6,808 |
Other | 650 | 3,295 |
Other non-current liabilities | $ 8,066 | $ 32,504 |
Other Liabilities - Narrative (
Other Liabilities - Narrative (Details) - Closed Stores - USD ($) $ in Thousands | Sep. 29, 2019 | Dec. 30, 2018 | Dec. 31, 2017 |
Restructuring Cost and Reserve [Line Items] | |||
Closed-restaurant reserve | $ 1,124 | $ 8,819 | $ 12,994 |
Other Liabilities, Non-current | |||
Restructuring Cost and Reserve [Line Items] | |||
Closed-restaurant reserve | $ 100 | $ 4,400 |
Other Liabilities - Closed-Rest
Other Liabilities - Closed-Restaurant Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 29, 2019 | Sep. 29, 2019 | Dec. 30, 2018 | |
Activity in the Closed-Restaurant Reserve | |||
Operating lease rental payments | $ 11,396 | $ 34,097 | |
Closed Stores | |||
Activity in the Closed-Restaurant Reserve | |||
Balance, beginning of period | 8,819 | $ 12,994 | |
Provisions for restaurant closures | 0 | 2,228 | |
Additional lease charges (recoveries), net | (808) | (152) | |
Payments, net | (895) | (6,778) | |
Other adjustments | (5,992) | 527 | |
Balance, end of period | $ 1,124 | 1,124 | $ 8,819 |
Operating lease rental payments | $ 5,700 |
Leases - Narrative (Details)
Leases - Narrative (Details) | 9 Months Ended |
Sep. 29, 2019lease | |
Lessee, Lease, Description [Line Items] | |
Number of leases for restaurant properties and corporate office space that had not yet commenced | 5 |
Lease term of leases not yet commenced | 15 years |
Sublease includes options to extend sublease term, up to | 25 years |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Lease term | 20 years |
Remaining lease term | 3 months 18 days |
Sublease, remaining lease term | 2 years 7 months 6 days |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Lease term | 40 years |
Remaining lease term | 22 years 1 month 6 days |
Sublease, remaining lease term | 19 years 8 months 12 days |
Leases - Lease Expense (Details
Leases - Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 29, 2019 | Sep. 29, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 11,396 | $ 34,097 |
Finance lease costs: | ||
Amortization of right-of-use assets | 59 | 136 |
Interest on lease liabilities | 58 | 168 |
Total finance lease costs | 117 | 304 |
Variable lease costs | 2,766 | 8,855 |
Sublease income | (1,135) | (2,764) |
Total lease costs | $ 13,144 | $ 40,492 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Sep. 29, 2019 | Dec. 30, 2018 |
Operating Leases | ||
Operating lease right-of-use assets | $ 254,449 | $ 0 |
Other current liabilities | 19,647 | 0 |
Operating lease liabilities | 258,891 | $ 0 |
Total operating lease liabilities | 278,538 | |
Finance Leases | ||
Property and equipment, gross | 2,874 | |
Accumulated amortization | (1,268) | |
Property and equipment, net | 1,606 | |
Current portion of long-term debt | 204 | |
Long-term debt, net of current portion | 1,887 | |
Total finance lease liabilities | $ 2,091 | |
Weighted Average Remaining Lease Term (in Years) | ||
Operating leases | 12 years 1 month 6 days | |
Finance leases | 8 years 1 month 6 days | |
Weighted Average Discount Rate | ||
Operating leases | 7.70% | |
Finance leases | 12.61% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 29, 2019 | Dec. 30, 2018 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows for operating leases | $ 32,833 | |
Operating cash flows for finance leases | 168 | |
Financing cash flows for finance leases | 109 | |
Right-of-use assets obtained in exchange for lease liabilities: | ||
Operating lease ROU assets | 8,618 | |
Finance lease ROU assets | 495 | |
Right-of-use assets and lease liabilities reduced for terminated leases: | ||
Operating lease ROU assets | 4,058 | |
Operating lease liabilities | 4,787 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease ROU assets | 254,449 | $ 0 |
Operating lease liabilities | 278,538 | |
ASU 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease ROU assets | 267,743 | |
Operating lease liabilities | $ 291,373 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands | Sep. 29, 2019 | Dec. 30, 2018 |
Operating Leases | ||
Remaining 2019 | $ 7,369 | |
2020 | 43,570 | |
2021 | 40,062 | |
2022 | 38,637 | |
2023 | 35,269 | |
2024 | 31,820 | |
Thereafter | 248,237 | |
Total lease payments | 444,964 | |
Less amount representing interest | (166,426) | |
Total operating lease liabilities | 278,538 | |
Less current portion | (19,647) | $ 0 |
Long-term portion of leases liabilities | 258,891 | $ 0 |
Finance Leases | ||
Remaining 2019 | 87 | |
2020 | 460 | |
2021 | 475 | |
2022 | 475 | |
2023 | 428 | |
2024 | 350 | |
Thereafter | 1,278 | |
Total lease payments | 3,553 | |
Less amount representing interest | (1,462) | |
Total finance lease liabilities | 2,091 | |
Less current portion | (204) | |
Long-term portion of leases liabilities | $ 1,887 |
Leases - Minimum Rent Commitmen
Leases - Minimum Rent Commitments Under Capital and Non-Cancelable Operating Leases (Details) $ in Thousands | Dec. 30, 2018USD ($) |
Operating | |
2019 | $ 44,427 |
2020 | 44,144 |
2021 | 41,396 |
2022 | 40,215 |
2023 | 36,587 |
Thereafter | 264,704 |
Total minimum lease payments | 471,473 |
Capital | |
2019 | 323 |
2020 | 327 |
2021 | 342 |
2022 | 342 |
2023 | 349 |
Thereafter | 1,646 |
Total minimum lease payments | 3,329 |
Less amount representing interest | (1,585) |
Total obligations under capital leases | 1,744 |
Less current portion | (108) |
Long-term debt under capital leases | 1,636 |
Minimum future sublease rent | $ 41,400 |
Leases - Subleases (Details)
Leases - Subleases (Details) $ in Thousands | Sep. 29, 2019USD ($) |
Operating Leases | |
Remaining 2019 | $ 937 |
2020 | 4,384 |
2021 | 4,551 |
2022 | 4,493 |
2023 | 4,481 |
2024 | 4,535 |
Thereafter | 41,798 |
Total | $ 65,179 |
Stockholders' Equity - Purchase
Stockholders' Equity - Purchase of Treasury Stock (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 29, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jul. 01, 2018 | Apr. 01, 2018 | Sep. 29, 2019 | Aug. 07, 2019 | Feb. 26, 2018 | |
Equity [Abstract] | ||||||||
Number of shares authorized to be repurchased | 1,500,000 | |||||||
Increase in share repurchase program, number of shares | 500,000 | |||||||
Treasury stock purchases (in shares) | 1,064,537 | |||||||
Treasury stock purchases | $ 9,158 | $ 2,199 | $ 1,532 | $ 603 | $ 349 | $ 11,300 |
Stockholders' Equity - Stock-Ba
Stockholders' Equity - Stock-Based Compensation (Details) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 29, 2019USD ($)trancheshares | Sep. 30, 2018USD ($) | Sep. 29, 2019USD ($)tranche$ / sharesshares | Sep. 30, 2018USD ($)$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | $ | $ 0.6 | $ 0.7 | $ 2.1 | $ 2.6 |
Unrecognized stock-based compensation expense | $ | $ 4.8 | $ 4.8 | ||
Nonvested Restricted Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares granted in period | 20,000 | 287,002 | ||
Vesting period | 4 years | |||
Weighted average grant date fair value, grants in period (usd per share) | $ / shares | $ 13 | |||
Share-based compensation cost not yet recognized, period for recognition | 2 years 8 months 12 days | |||
Nonvested Restricted Shares | Director | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 1 year | |||
Nonvested Restricted Shares | Consultant | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
Nonvested Restricted Shares | Executive Officer | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares granted in period | 15,348 | |||
Weighted average grant date fair value, grants in period (usd per share) | $ / shares | $ 1.76 | |||
Share-based compensation cost not yet recognized, period for recognition | 10 months 24 days | |||
Market Performance-Based Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average grant date fair value, grants in period (usd per share) | $ / shares | $ 1.76 | $ 6.96 | ||
Market Performance-Based Restricted Stock Units (RSUs) | Executive Officer | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares granted in period | 15,348 | |||
Vesting period | 2 years | |||
Weighted average grant date fair value, grants in period (usd per share) | $ / shares | $ 1.76 | |||
Number of tranches | tranche | 2 | 2 | ||
Market Performance-Based Restricted Stock Units (RSUs) | Executive Officer | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares to be issued at end of performance period | 0 | |||
Market Performance-Based Restricted Stock Units (RSUs) | Executive Officer | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares to be issued at end of performance period | 15,348 |
Stockholders' Equity - Non-vest
Stockholders' Equity - Non-vested Restricted Shares and Restricted Stock Units Activity (Details) - $ / shares | 3 Months Ended | 9 Months Ended |
Sep. 29, 2019 | Sep. 29, 2019 | |
Non-Vested Shares | ||
Non-vested Restricted Shares and Restricted Stock Units | ||
Outstanding at beginning of period (in shares) | 287,866 | |
Granted (in shares) | 20,000 | 287,002 |
Vested and released (in shares) | (128,811) | |
Forfeited (in shares) | (69,190) | |
Outstanding at end of period (in shares) | 376,867 | 376,867 |
Weighted Average Grant Date Fair Value | ||
Outstanding at beginning of period (usd per share) | $ 20.70 | |
Granted (usd per share) | 13 | |
Vested and released (usd per share) | 20.34 | |
Forfeited (usd per share) | 17.50 | |
Outstanding at end of period (usd per share) | $ 15.48 | $ 15.48 |
Restricted Stock Units | ||
Non-vested Restricted Shares and Restricted Stock Units | ||
Outstanding at beginning of period (in shares) | 231,112 | |
Granted (in shares) | 15,348 | |
Vested and released (in shares) | (3,418) | |
Forfeited (in shares) | (95,123) | |
Outstanding at end of period (in shares) | 147,919 | 147,919 |
Weighted Average Grant Date Fair Value | ||
Outstanding at beginning of period (usd per share) | $ 12.44 | |
Granted (usd per share) | 1.76 | |
Vested and released (usd per share) | 62.05 | |
Forfeited (usd per share) | 12.97 | |
Outstanding at end of period (usd per share) | $ 9.83 | $ 9.83 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock Units Subject to Market Conditions (Details) - Market Performance-Based Restricted Stock Units (RSUs) - $ / shares | 9 Months Ended | |
Sep. 29, 2019 | Sep. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grant date stock price (usd per share) | $ 14.66 | $ 18.70 |
Fair value at grant date (usd per share) | $ 1.76 | $ 6.96 |
Risk free interest rate | 2.53% | 2.40% |
Expected term (in years) | 2 years | 3 years |
Dividend yield | 0.00% | 0.00% |
Expected volatility | 43.18% | 41.49% |
Business Segment Information -
Business Segment Information - Segment Reporting Information, by Segment (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 29, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 29, 2019USD ($)segment | Sep. 30, 2018USD ($) | Dec. 30, 2018USD ($) | |
Segment Reporting [Abstract] | |||||
Number of operating segments | segment | 2 | ||||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 164,248 | $ 174,648 | $ 501,481 | $ 520,959 | |
Cost of sales | 52,056 | 56,021 | 156,324 | 166,275 | |
Restaurant wages and related expenses | 44,459 | 47,943 | 135,261 | 142,103 | |
Restaurant rent expense | 11,970 | 9,129 | 35,613 | 26,861 | |
Other restaurant operating expenses | 24,153 | 27,294 | 68,429 | 75,398 | |
Advertising expense | 6,385 | 6,472 | 17,789 | 18,046 | |
General and administrative expense | 13,820 | 13,284 | 42,387 | 41,023 | |
Adjusted EBITDA | 12,154 | 15,037 | 48,132 | 52,172 | |
Depreciation and amortization | 10,165 | 9,739 | 29,520 | 27,908 | |
Capital expenditures | 12,402 | 12,635 | 34,073 | 39,923 | |
Identifiable assets | 577,602 | 577,602 | $ 418,659 | ||
Stock-based compensation expense | 600 | 700 | 2,100 | 2,600 | |
Restaurant Wages And Related Expenses | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 102 | 6 | 145 | 56 | |
General and Administrative Expense | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 509 | 732 | 1,993 | 2,588 | |
Restaurant sales | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 163,589 | 173,966 | 499,483 | 518,951 | |
Franchise revenue | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 659 | 682 | 1,998 | 2,008 | |
Operating Segments | Pollo Tropical | |||||
Segment Reporting Information [Line Items] | |||||
Cost of sales | 28,239 | 31,219 | 85,855 | 93,716 | |
Restaurant wages and related expenses | 20,944 | 21,947 | 63,387 | 65,652 | |
Restaurant rent expense | 5,477 | 4,392 | 16,393 | 13,024 | |
Other restaurant operating expenses | 12,807 | 13,521 | 36,665 | 38,270 | |
Advertising expense | 3,130 | 3,413 | 9,351 | 9,859 | |
General and administrative expense | 7,521 | 7,291 | 23,568 | 22,256 | |
Adjusted EBITDA | 10,980 | 12,544 | 39,943 | 42,520 | |
Depreciation and amortization | 5,529 | 5,438 | 16,118 | 16,117 | |
Capital expenditures | 6,402 | 4,621 | 18,195 | 17,656 | |
Identifiable assets | 348,149 | 348,149 | 207,435 | ||
Operating Segments | Pollo Tropical | Restaurant Wages And Related Expenses | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 39 | 4 | 48 | 23 | |
Operating Segments | Pollo Tropical | General and Administrative Expense | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 268 | 407 | 1,196 | 1,458 | |
Operating Segments | Pollo Tropical | Restaurant sales | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 88,309 | 93,592 | 271,955 | 283,447 | |
Operating Segments | Pollo Tropical | Franchise revenue | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 432 | 453 | 1,325 | 1,376 | |
Operating Segments | Taco Cabana | |||||
Segment Reporting Information [Line Items] | |||||
Cost of sales | 23,817 | 24,802 | 70,469 | 72,559 | |
Restaurant wages and related expenses | 23,515 | 25,996 | 71,874 | 76,451 | |
Restaurant rent expense | 6,493 | 4,737 | 19,220 | 13,837 | |
Other restaurant operating expenses | 11,346 | 13,773 | 31,764 | 37,128 | |
Advertising expense | 3,255 | 3,059 | 8,438 | 8,187 | |
General and administrative expense | 6,299 | 5,993 | 18,819 | 18,767 | |
Adjusted EBITDA | 1,174 | 2,493 | 8,189 | 9,652 | |
Depreciation and amortization | 4,636 | 4,301 | 13,402 | 11,791 | |
Capital expenditures | 5,015 | 7,489 | 14,982 | 21,400 | |
Identifiable assets | 210,238 | 210,238 | 174,681 | ||
Operating Segments | Taco Cabana | Restaurant Wages And Related Expenses | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 63 | 2 | 97 | 33 | |
Operating Segments | Taco Cabana | General and Administrative Expense | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 241 | 325 | 797 | 1,130 | |
Operating Segments | Taco Cabana | Restaurant sales | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 75,280 | 80,374 | 227,528 | 235,504 | |
Operating Segments | Taco Cabana | Franchise revenue | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 227 | 229 | 673 | 632 | |
Other | |||||
Segment Reporting Information [Line Items] | |||||
Cost of sales | 0 | 0 | 0 | 0 | |
Restaurant wages and related expenses | 0 | 0 | 0 | 0 | |
Restaurant rent expense | 0 | 0 | 0 | 0 | |
Other restaurant operating expenses | 0 | 0 | 0 | 0 | |
Advertising expense | 0 | 0 | 0 | 0 | |
General and administrative expense | 0 | 0 | 0 | 0 | |
Adjusted EBITDA | 0 | 0 | 0 | 0 | |
Depreciation and amortization | 0 | 0 | 0 | 0 | |
Capital expenditures | 985 | 525 | 896 | 867 | |
Identifiable assets | 19,215 | 19,215 | $ 36,543 | ||
Other | Restaurant Wages And Related Expenses | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 0 | 0 | 0 | 0 | |
Other | General and Administrative Expense | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense | 0 | 0 | 0 | 0 | |
Other | Restaurant sales | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 0 | 0 | 0 | 0 | |
Other | Franchise revenue | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 0 | $ 0 | $ 0 | $ 0 |
Business Segment Information _2
Business Segment Information - Reconciliation of Consolidated Net Income (Loss) to Adjusted EBITDA (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 29, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jul. 01, 2018 | Apr. 01, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||||||
Net income (loss) | $ (22,182) | $ (43,440) | $ 2,289 | $ 2,047 | $ 9,493 | $ 4,184 | $ (63,333) | $ 15,724 |
Benefit from income taxes | (2,946) | (4,892) | (1,377) | (246) | ||||
Income (loss) before income taxes | (25,128) | (2,845) | (64,710) | 15,478 | ||||
Non-general and administrative expense adjustments: | ||||||||
Depreciation and amortization | 10,165 | 9,739 | 29,520 | 27,908 | ||||
Impairment and other lease charges | 3,254 | 6,417 | 4,667 | 6,539 | ||||
Goodwill impairment | 21,424 | 0 | 67,909 | 0 | ||||
Interest expense | 823 | 924 | 3,024 | 2,979 | ||||
Closed restaurant rent expense, net of sublease income | 726 | 0 | 3,485 | 0 | ||||
Other expense (income), net | 64 | 47 | 920 | (3,132) | ||||
Stock-based compensation expense in restaurant wages | 600 | 700 | 2,100 | 2,600 | ||||
Total non-general and administrative expense adjustments | 36,558 | 17,133 | 109,670 | 34,350 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 600 | 700 | 2,100 | 2,600 | ||||
Board and shareholder matter costs | (597) | |||||||
Restructuring costs and retention bonuses | 17 | 964 | 520 | |||||
Legal settlements and related costs | (167) | |||||||
Total general and administrative expense adjustments | 724 | 749 | 3,172 | 2,344 | ||||
Adjusted EBITDA | 12,154 | 15,037 | 48,132 | 52,172 | ||||
Restaurant Wages And Related Expenses | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 102 | 6 | 145 | 56 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 102 | 6 | 145 | 56 | ||||
General and Administrative Expense | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 509 | 732 | 1,993 | 2,588 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 509 | 732 | 1,993 | 2,588 | ||||
Digital and brand repositioning costs | 215 | 215 | ||||||
Pollo Tropical | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Impairment and other lease charges | 165 | 3,295 | (162) | 3,439 | ||||
Goodwill impairment | 0 | |||||||
Taco Cabana | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Impairment and other lease charges | 3,089 | 3,122 | 4,829 | 3,100 | ||||
Goodwill impairment | 67,177 | |||||||
Operating Segments | Pollo Tropical | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Income (loss) before income taxes | 3,857 | 2,976 | 16,731 | 21,901 | ||||
Non-general and administrative expense adjustments: | ||||||||
Depreciation and amortization | 5,529 | 5,438 | 16,118 | 16,117 | ||||
Impairment and other lease charges | 165 | 3,295 | (162) | 3,439 | ||||
Goodwill impairment | 0 | 0 | ||||||
Interest expense | 398 | 448 | 1,534 | 1,467 | ||||
Closed restaurant rent expense, net of sublease income | 601 | 2,784 | ||||||
Other expense (income), net | 5 | (29) | 749 | (1,577) | ||||
Total non-general and administrative expense adjustments | 6,737 | 9,156 | 21,071 | 19,469 | ||||
General and administrative expense adjustments: | ||||||||
Board and shareholder matter costs | (328) | |||||||
Restructuring costs and retention bonuses | 5 | 827 | 187 | |||||
Legal settlements and related costs | (167) | |||||||
Total general and administrative expense adjustments | 386 | 412 | 2,141 | 1,150 | ||||
Adjusted EBITDA | 10,980 | 12,544 | 39,943 | 42,520 | ||||
Operating Segments | Pollo Tropical | Restaurant Wages And Related Expenses | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 39 | 4 | 48 | 23 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 39 | 4 | 48 | 23 | ||||
Operating Segments | Pollo Tropical | General and Administrative Expense | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 268 | 407 | 1,196 | 1,458 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 268 | 407 | 1,196 | 1,458 | ||||
Digital and brand repositioning costs | 118 | 118 | ||||||
Operating Segments | Taco Cabana | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Income (loss) before income taxes | (28,985) | (5,821) | (81,441) | (6,423) | ||||
Non-general and administrative expense adjustments: | ||||||||
Depreciation and amortization | 4,636 | 4,301 | 13,402 | 11,791 | ||||
Impairment and other lease charges | 3,089 | 3,122 | 4,829 | 3,100 | ||||
Goodwill impairment | 21,424 | 67,909 | ||||||
Interest expense | 425 | 476 | 1,490 | 1,512 | ||||
Closed restaurant rent expense, net of sublease income | 125 | 701 | ||||||
Other expense (income), net | 59 | 76 | 171 | (1,555) | ||||
Total non-general and administrative expense adjustments | 29,821 | 7,977 | 88,599 | 14,881 | ||||
General and administrative expense adjustments: | ||||||||
Board and shareholder matter costs | (269) | |||||||
Restructuring costs and retention bonuses | 12 | 137 | 333 | |||||
Legal settlements and related costs | 0 | |||||||
Total general and administrative expense adjustments | 338 | 337 | 1,031 | 1,194 | ||||
Adjusted EBITDA | 1,174 | 2,493 | 8,189 | 9,652 | ||||
Operating Segments | Taco Cabana | Restaurant Wages And Related Expenses | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 63 | 2 | 97 | 33 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 63 | 2 | 97 | 33 | ||||
Operating Segments | Taco Cabana | General and Administrative Expense | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 241 | 325 | 797 | 1,130 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 241 | 325 | 797 | 1,130 | ||||
Digital and brand repositioning costs | 97 | 97 | ||||||
Other | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Income (loss) before income taxes | 0 | 0 | 0 | 0 | ||||
Non-general and administrative expense adjustments: | ||||||||
Depreciation and amortization | 0 | 0 | 0 | 0 | ||||
Impairment and other lease charges | 0 | 0 | 0 | 0 | ||||
Goodwill impairment | 0 | 0 | ||||||
Interest expense | 0 | 0 | 0 | 0 | ||||
Closed restaurant rent expense, net of sublease income | 0 | 0 | ||||||
Other expense (income), net | 0 | 0 | 0 | 0 | ||||
Total non-general and administrative expense adjustments | 0 | 0 | 0 | 0 | ||||
General and administrative expense adjustments: | ||||||||
Board and shareholder matter costs | 0 | |||||||
Restructuring costs and retention bonuses | 0 | 0 | 0 | |||||
Legal settlements and related costs | 0 | |||||||
Total general and administrative expense adjustments | 0 | 0 | 0 | 0 | ||||
Adjusted EBITDA | 0 | 0 | 0 | 0 | ||||
Other | Restaurant Wages And Related Expenses | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 0 | 0 | 0 | 0 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 0 | 0 | 0 | 0 | ||||
Other | General and Administrative Expense | ||||||||
Non-general and administrative expense adjustments: | ||||||||
Stock-based compensation expense in restaurant wages | 0 | 0 | 0 | 0 | ||||
General and administrative expense adjustments: | ||||||||
Stock-based compensation expense | 0 | $ 0 | 0 | $ 0 | ||||
Digital and brand repositioning costs | $ 0 | $ 0 |
Earnings (Loss) Per Share - Nar
Earnings (Loss) Per Share - Narrative (Details) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2018shares | Sep. 30, 2018shares | Sep. 29, 2019 | |
Earnings Per Share [Abstract] | |||
Nonvested restricted shares right to receive dividends, per share ratio to common shares | 1 | ||
Restricted Stock Units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average antidilutive securities excluded from computation of diluted earnings per share (in shares) | 568 | 746 |
Earnings (Loss) Per Share - Com
Earnings (Loss) Per Share - Computation of Basic and Diluted Net Income per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 29, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jul. 01, 2018 | Apr. 01, 2018 | Sep. 29, 2019 | Sep. 30, 2018 | |
Basic and diluted EPS: | ||||||||
Net income (loss) | $ (22,182) | $ (43,440) | $ 2,289 | $ 2,047 | $ 9,493 | $ 4,184 | $ (63,333) | $ 15,724 |
Less: income allocated to participating securities | 0 | 23 | 0 | 171 | ||||
Net income (loss) available to common shareholders | $ (22,182) | $ 2,024 | $ (63,333) | $ 15,553 | ||||
Weighted average common shares—basic | 26,548,116 | 26,954,285 | 26,734,822 | 26,900,716 | ||||
Restricted stock units (in shares) | 0 | 4,589 | 0 | 4,675 | ||||
Weighted average common shares—diluted | 26,548,116 | 26,958,874 | 26,734,822 | 26,905,391 | ||||
Earnings per common share—basic (usd per share) | $ (0.84) | $ 0.08 | $ (2.37) | $ 0.58 | ||||
Earnings per common share—diluted (usd per share) | $ (0.84) | $ 0.08 | $ (2.37) | $ 0.58 |
Commitments and Contingencies -
Commitments and Contingencies - Lease Assignments (Details) $ in Millions | Sep. 29, 2019USD ($)lease |
Loss Contingencies [Line Items] | |
Maximum potential liability for future rental payments | $ | $ 3.3 |
Taco Cabana | |
Loss Contingencies [Line Items] | |
Number of leases assigned | 3 |
Pollo Tropical | |
Loss Contingencies [Line Items] | |
Number of leases assigned | 1 |