Cover
Cover - shares | 9 Months Ended | |
Sep. 25, 2021 | Nov. 05, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 25, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-39898 | |
Entity Registrant Name | Driven Brands Holdings Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-3595252 | |
Entity Address, Address Line One | 440 South Church Street | |
Entity Address, Address Line Two | Suite 700 | |
Entity Address, City or Town | Charlotte | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 28202 | |
City Area Code | 704 | |
Local Phone Number | 377-8855 | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | DRVN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 167,379,785 | |
Entity Central Index Key | 0001804745 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-25 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 25, 2021 | Sep. 26, 2020 | Sep. 25, 2021 | Sep. 26, 2020 | ||
Revenue: | |||||
Revenue | $ 371,148 | $ 267,762 | $ 1,075,395 | $ 615,692 | |
Operating expenses: | |||||
Selling, general and administrative expenses | 71,565 | 56,586 | 218,549 | 153,107 | |
Acquisition costs | 636 | 12,076 | 2,674 | 13,287 | |
Store opening costs | 666 | 119 | 1,360 | 1,921 | |
Depreciation and amortization | 28,447 | 16,221 | 78,722 | 32,656 | |
Asset impairment charges and lease terminations | (270) | 321 | 3,161 | 6,732 | |
Total operating expenses | 307,420 | 229,726 | 898,307 | 540,627 | |
Operating income | 63,728 | 38,036 | 177,088 | 75,065 | |
Other expenses, net: | |||||
Interest expense, net | 17,688 | 29,594 | 52,390 | 64,973 | |
Net loss (gain) on foreign currency transactions | 1,074 | (2,230) | 6,356 | 55 | |
Loss on debt extinguishment | 0 | 673 | 45,576 | 673 | |
Total other expenses, net | 18,762 | 28,037 | 104,322 | 65,701 | |
Net income before taxes | 44,966 | 9,999 | 72,766 | 9,364 | |
Income tax expense | 11,880 | 5,888 | 24,445 | 6,109 | |
Net income | 33,086 | 4,111 | 48,321 | 3,255 | |
Net (loss) income attributable to non-controlling interests | (38) | 32 | (68) | (34) | |
Net income attributable to Driven Brands Holdings Inc. | $ 33,124 | $ 4,079 | $ 48,389 | $ 3,289 | |
Earnings (loss) per share | |||||
Basic (in dollars per share) | [1] | $ 0.20 | $ 0.04 | $ 0.30 | $ 0.03 |
Diluted (in dollars per share) | [1] | $ 0.19 | $ 0.04 | $ 0.29 | $ 0.03 |
Weighted average shares outstanding | |||||
Basic (shares) | [1] | 162,635,000 | 111,950,000 | 160,030,000 | 96,643,000 |
Diluted (shares) | [1] | 166,630,000 | 111,950,000 | 163,968,000 | 96,643,000 |
Franchise royalties and fees | |||||
Revenue: | |||||
Revenue | $ 38,953 | $ 36,520 | $ 107,240 | $ 94,214 | |
Company-operated store sales | |||||
Revenue: | |||||
Revenue | 213,755 | 140,788 | 603,808 | 323,339 | |
Operating expenses: | |||||
Operating expenses | 130,520 | 85,668 | 367,095 | 202,333 | |
Independently-operated store sales | |||||
Revenue: | |||||
Revenue | 47,941 | 30,595 | 160,483 | 30,595 | |
Operating expenses: | |||||
Operating expenses | 27,764 | 17,995 | 89,664 | 17,995 | |
Advertising fund contributions | |||||
Revenue: | |||||
Revenue | 19,762 | 14,927 | 56,665 | 42,429 | |
Operating expenses: | |||||
Operating expenses | 19,762 | 14,927 | 56,665 | 42,429 | |
Supply and other revenue | |||||
Revenue: | |||||
Revenue | 50,737 | 44,932 | 147,199 | 125,115 | |
Operating expenses: | |||||
Operating expenses | $ 28,330 | $ 25,813 | $ 80,417 | $ 70,167 | |
[1] | Shares and earnings (loss) per share for 2020 have been adjusted to reflect an implied 88,990-for-one stock split that became effective on January 14, 2021. See Note 1 for additional information. |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) | Jan. 14, 2021 |
Income Statement [Abstract] | |
Stock split | 88,990 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2021 | Sep. 26, 2020 | Sep. 25, 2021 | Sep. 26, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 33,086 | $ 4,111 | $ 48,321 | $ 3,255 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | (30,844) | (2,850) | (28,675) | (14,096) |
Unrealized gain from cash flow hedges, net of tax | (1) | 552 | 29 | 552 |
Defined benefit pension plan actuarial gain, net of tax | 3 | 0 | 131 | 0 |
Other comprehensive loss, net | (30,842) | (2,298) | (28,515) | (13,544) |
Total comprehensive income (loss) | 2,244 | 1,813 | 19,806 | (10,289) |
Comprehensive income (loss) attributable to non-controlling interests | (47) | 97 | (8) | (34) |
Comprehensive income (loss) attributable to Driven Brands Holdings Inc. | $ 2,291 | $ 1,716 | $ 19,814 | $ (10,255) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 25, 2021 | Dec. 26, 2020 | |
Current assets: | |||
Cash and cash equivalents | $ 115,365 | $ 172,611 | |
Restricted cash | 135 | 15,827 | |
Accounts and notes receivable, net | 110,907 | 84,805 | |
Inventory | 44,259 | 43,039 | |
Prepaid and other assets | 26,022 | 25,070 | |
Income tax receivable | 2,619 | 3,055 | |
Advertising fund assets, restricted | 39,698 | 29,276 | |
Total current assets | 339,005 | 373,683 | |
Notes receivable, net | 2,748 | 3,828 | |
Property and equipment, net | 1,121,204 | 827,392 | |
Operating lease right-of-use assets | 905,527 | 884,927 | |
Deferred commissions | 9,878 | 8,661 | |
Intangibles, net | 817,665 | 829,308 | |
Goodwill | 1,810,085 | 1,727,351 | |
Total assets | 5,006,112 | 4,655,150 | |
Current liabilities: | |||
Accounts payable | 72,458 | 67,802 | |
Accrued expenses and other liabilities | 217,589 | 190,867 | |
Income tax payable | 2,791 | 3,513 | |
Current portion of long term debt | 18,342 | 22,988 | |
Advertising fund liabilities | 25,457 | 20,276 | |
Total current liabilities | 336,637 | 305,446 | |
Long-term debt, net | 1,677,337 | 2,102,219 | |
Deferred tax liability | 261,906 | 249,043 | |
Operating lease liabilities | 843,925 | 818,001 | |
Income tax receivable liability | 155,970 | 0 | |
Deferred revenue | 24,770 | 20,757 | |
Long-term accrued expenses and other liabilities | 30,070 | 53,324 | |
Total liabilities | 3,330,615 | 3,548,790 | |
Common stock | [1] | 1,674 | 565 |
Additional paid-in capital | 1,604,342 | 1,055,172 | |
Retained earnings | 80,364 | 31,975 | |
Accumulated other comprehensive income (loss) | (12,047) | 16,528 | |
Total shareholders’ equity attributable to Driven Brands Holdings Inc. | 1,674,333 | 1,104,240 | |
Non-controlling interests | 1,164 | 2,120 | |
Total shareholders' equity | 1,675,497 | 1,106,360 | |
Total liabilities and shareholders' equity | $ 5,006,112 | $ 4,655,150 | |
[1] | Common stock at December 26, 2020 has been adjusted to reflect an implied 88,990-for-one stock split that became effective on January 14, 2021. See Note 1 for additional information. |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’/MEMBERS’ EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Cumulative Effect, Period of Adoption, Adjusted Balance | Common stock | Common stockCumulative Effect, Period of Adoption, Adjusted Balance | Additional paid-in capital | Additional paid-in capitalCumulative Effect, Period of Adoption, Adjusted Balance | Retained earnings | Retained earningsCumulative Effect, Period of Adoption, Adjustment | Retained earningsCumulative Effect, Period of Adoption, Adjusted Balance | Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss)Cumulative Effect, Period of Adoption, Adjusted Balance | Non-controlling interests | Non-controlling interestsCumulative Effect, Period of Adoption, Adjusted Balance |
Beginning balance at Dec. 28, 2019 | $ 289,878 | $ 284,069 | $ 565 | $ 565 | $ 242,240 | $ 242,240 | $ 41,983 | $ 36,174 | $ 3,626 | $ 3,626 | $ 1,464 | $ 1,464 | ||
Beginning balance (Accounting Standards Update 2016-02) at Dec. 28, 2019 | $ (4,012) | $ (4,012) | ||||||||||||
Beginning balance (Accounting Standards Update 2016-13) at Dec. 28, 2019 | $ (1,797) | $ (1,797) | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | 3,255 | 3,289 | (34) | |||||||||||
Other comprehensive (loss) | (13,544) | (13,544) | 0 | |||||||||||
Equity-based compensation expense | 508 | 508 | ||||||||||||
Common stock issued in a business combination | 809,000 | 809,000 | ||||||||||||
Acquisition of subsidiary with noncontrolling interest | 400 | 400 | ||||||||||||
Ending balance at Sep. 26, 2020 | 1,083,688 | 565 | 1,051,748 | 39,463 | (9,918) | 1,830 | ||||||||
Beginning balance at Jun. 27, 2020 | (7,489) | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | 4,111 | |||||||||||||
Other comprehensive (loss) | (2,298) | |||||||||||||
Ending balance at Sep. 26, 2020 | 1,083,688 | 565 | 1,051,748 | 39,463 | (9,918) | 1,830 | ||||||||
Beginning balance at Dec. 26, 2020 | 1,106,360 | 565 | 1,055,172 | 31,975 | 16,528 | 2,120 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | (19,932) | (19,939) | 7 | |||||||||||
Other comprehensive (loss) | (9,085) | (9,085) | ||||||||||||
Equity-based compensation expense | 983 | 983 | ||||||||||||
Issuance of common stock upon initial public offering, net of underwriting discounts and commissions | 661,500 | 1,082 | 660,418 | |||||||||||
Common stock issued upon underwriter's exercise of over-allotment | 99,225 | 48 | 99,177 | |||||||||||
Repurchase of common stock | (42,977) | (21) | (42,956) | |||||||||||
Exercise of stock options | 25 | 25 | ||||||||||||
Establishment of income tax receivable liability | (155,970) | (155,970) | ||||||||||||
IPO fees | (14,757) | (14,757) | ||||||||||||
Other | (63) | 0 | (63) | |||||||||||
Ending balance at Mar. 27, 2021 | 1,625,309 | 1,674 | 1,602,092 | 12,036 | 7,443 | 2,064 | ||||||||
Beginning balance at Dec. 26, 2020 | 1,106,360 | 565 | 1,055,172 | 31,975 | 16,528 | 2,120 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | 48,321 | |||||||||||||
Other comprehensive (loss) | (28,515) | |||||||||||||
Ending balance at Sep. 25, 2021 | 1,675,497 | 1,674 | 1,604,342 | 80,364 | (12,047) | 1,164 | ||||||||
Beginning balance at Mar. 27, 2021 | 1,625,309 | 1,674 | 1,602,092 | 12,036 | 7,443 | 2,064 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | 35,167 | 35,204 | (37) | |||||||||||
Other comprehensive (loss) | 11,412 | 11,412 | 0 | |||||||||||
Equity-based compensation expense | 1,028 | 1,028 | ||||||||||||
At-Pac divestiture | (948) | (948) | ||||||||||||
Other | (26) | (25) | (1) | |||||||||||
Ending balance at Jun. 26, 2021 | 1,671,942 | 1,674 | 1,603,095 | 47,240 | 18,854 | 1,079 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | 33,086 | 33,124 | (38) | |||||||||||
Other comprehensive (loss) | (30,842) | (30,902) | 60 | |||||||||||
Equity-based compensation expense | 933 | 933 | ||||||||||||
Exercise of stock options | 314 | 314 | ||||||||||||
Other | 64 | 1 | 63 | |||||||||||
Ending balance at Sep. 25, 2021 | $ 1,675,497 | $ 1,674 | $ 1,604,342 | $ 80,364 | $ (12,047) | $ 1,164 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 25, 2021 | Sep. 26, 2020 | |
Statement of Cash Flows [Abstract] | ||
Net income | $ 48,321 | $ 3,255 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 78,722 | 32,656 |
Non-cash lease cost | 56,563 | 26,254 |
Loss on foreign denominated transactions | 9,301 | 55 |
Gain on derivatives not designed as hedges | (2,945) | 0 |
Bad debt expense | 2,535 | 4,829 |
Asset impairment charges and lease terminations | 3,161 | 6,732 |
Amortization of deferred financing costs and bond discounts | 5,139 | 7,176 |
Benefit (provision) for deferred income taxes | 15,898 | (4,524) |
Loss on debt extinguishment | 45,576 | 673 |
Other, net | 4,257 | 1,566 |
Changes in assets and liabilities, net of acquisitions: | ||
Accounts and notes receivable, net | (28,787) | (12,349) |
Inventory | (3,279) | (1,328) |
Prepaid and other assets | (18,414) | 1,755 |
Advertising fund assets and liabilities, restricted | 5,818 | (554) |
Deferred commissions | (1,205) | (1,810) |
Deferred revenue | 3,983 | 3,438 |
Accounts payable | (3,903) | 10,311 |
Accrued expenses and other liabilities | 25,595 | 8,926 |
Income tax receivable | (320) | 7,551 |
Operating lease liabilities | (47,821) | (28,157) |
Cash provided by operating activities | 198,195 | 66,455 |
Cash flows from investing activities: | ||
Capital expenditures | (93,627) | (35,124) |
Cash used in business acquisitions, net of cash acquired | (442,488) | 8,575 |
Proceeds from sale-leaseback transactions | 66,391 | 0 |
Proceeds from sale of At-Pac business | 1,532 | 0 |
Proceeds from disposal of property and equipment | 5,471 | 0 |
Cash used in investing activities | (462,721) | (26,549) |
Cash flows from financing activities: | ||
Payment of contingent consideration related to acquisitions | 0 | (2,783) |
Payment of debt extinguishment and issuance costs | (2,153) | (12,639) |
Proceeds from the issuance of long-term debt | 0 | 175,000 |
Repayment of long-term debt | (716,542) | (11,619) |
Proceeds from revolving lines of credit and short-term debt | 441,800 | 152,101 |
Repayments of revolving lines of credit and short-term debt | (212,800) | (191,600) |
Repayment of principal portion of finance lease liability | (1,760) | (731) |
Proceeds from failed sale-leaseback transactions | 0 | 3,432 |
Proceeds from initial public offering, net of underwriting discounts | 661,500 | 0 |
Net proceeds from underwriters' exercise of over-allotment option | 99,225 | 0 |
Repurchases of common stock | (43,040) | 0 |
Payment for termination of interest rate swaps | (21,826) | 0 |
Stock option exercises | 339 | 0 |
Other, net | 102 | 0 |
Cash provided by financing activities | 204,845 | 111,161 |
Effect of exchange rate changes on cash | (2,285) | 468 |
Net change in cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted | (61,966) | 151,535 |
Cash and cash equivalents, beginning of period | 172,611 | 34,935 |
Cash Included In Advertising Funds, Restricted Cash And Restricted Cash Equivalents | 19,369 | 23,091 |
Restricted cash, beginning of period | 15,827 | 0 |
Cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted, beginning of period | 207,807 | 58,026 |
Cash and cash equivalents, end of period | 115,365 | 184,356 |
Cash included in advertising fund assets, restricted, end of period | 30,341 | 25,205 |
Restricted cash, end of period | 135 | 0 |
Cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted, end of period | 145,841 | 209,561 |
Supplemental cash flow disclosures - non-cash items: | ||
Accrued capital expenditures, end of period | 6,123 | 984 |
Supplemental cash flow disclosures - cash paid for: | ||
Interest | 53,842 | 61,887 |
Income taxes | $ 10,593 | $ 3,141 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) | Sep. 25, 2021$ / sharesshares | Dec. 26, 2020$ / sharesshares |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 900,000,000 | 900,000,000 |
Common stock, shares issued (in shares) | 167,000,000 | 127,000,000 |
Common stock, shares outstanding (in shares) | 167,000,000 | 127,000,000 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 25, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Description of Business Driven Brands Holdings Inc., together with its subsidiaries (collectively, the “Company”), is a Delaware corporation and is the parent holding company of Driven Brands, Inc. and Shine Holdco (UK) Limited (collectively, “Driven Brands”). Driven Brands is the largest automotive services company in North America with a growing and highly-franchised base of more than 4,300 franchised, independently-operated, and company-operated locations across 49 U.S. states and 14 other countries. The Company has a portfolio of highly recognized brands, including Take 5 Oil Change®, Meineke Car Care Centers®, MAACO®, CARSTAR®, and 1-800-Radiator & A/C® that compete in the automotive services industry. Approximately 81% of the Company’s locations are franchised or independently-operated. Initial Public Offering and Secondary Offering On January 14, 2021, the Company completed an initial public offering (the “IPO”) of approximately 32 million shares of common stock at $22 per share. On February 10, 2021, the Company’s underwriters exercised their over-allotment option to purchase approximately 5 million additional shares of common stock. The Company received total proceeds of $761 million from these transactions, net of the underwriting discounts and commissions. The Company used the proceeds from the IPO, along with cash on hand, to fully repay the First Lien Term Loan, Second Lien Term Loan, and revolving credit facility assumed as part of the acquisition of International Car Wash Group (“ICWG”) in 2020 (collectively, the “Car Wash Senior Credit Facilities”), which totaled $725 million with interest and fees. The Company recognized a $46 million loss on debt extinguishment related to this settlement, primarily related to the write-off of unamortized discount. The Company cancelled the interest rate and cross currency swaps associated with these debt agreements as part of the settlement. The Company also used $43 million in proceeds to purchase approximately 2 million shares of common stock from certain of our existing shareholders. On August 2, 2021, the Company filed a Registration Statement on Form S-1 for a secondary offering of approximately 12 million shares of common stock at $29.50 per share by certain of the Company’s stockholders, Driven Equity LLC and RC IV Cayman ICW Holdings LLC, each of which is a related party of Roark Capital Management, LLC. The Company did not sell any common stock in the offering and did not receive any proceeds from the offering. On September 8, 2021, the underwriters for the secondary offering exercised a portion of their over-allotment option and purchased 881,393 additional shares of common stock. The Company did not receive any proceeds from the exercise of the over-allotment option. Income Tax Receivable Agreement The Company expects to be able to utilize certain tax benefits which are related to periods prior to the effective date of the Company’s IPO and are attributed to current and former shareholders. The Company previously entered into an income tax receivable agreement which provides our pre-IPO shareholders with the right to receive payment of 85% of the amount of cash savings, if any, in U.S. and Canadian federal, state, local and provincial income tax that the Company will actually realize. The income tax receivable agreement is effective as of the date of the Company’s IPO, and the Company has recorded a liability of $156 million as of September 25, 2021, which is recorded under long-term liabilities as the income tax receivable liability on the consolidated balance sheet. Stock Split |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 25, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Fiscal Year The Company operates and reports financial information on a 52- or 53-week year with the fiscal year ending on the last Saturday in December and fiscal quarters ending on the 13th Saturday of each quarter (or 14th Saturday when applicable with respect to the fourth fiscal quarter). The three and nine months ended September 25, 2021 and September 26, 2020, each consist of 13 and 39 weeks, respectively. The Car Wash segment (primarily ICWG which was acquired in August 2020) is currently consolidated based on a calendar month end. See Note 3 for additional discussion regarding the acquisition of ICWG. Basis of Presentation The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of results of operations, balance sheet, cash flows, and shareholders’ equity for the periods presented have been reflected. The adjustments include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. These interim consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the year ended December 26, 2020. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The results of operations for the three and nine months ended September 25, 2021 may not be indicative of the results to be expected for any other interim period or the year ending December 25, 2021. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the related notes to the consolidated financial statements. Estimates are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. Management evaluates its estimates and assumptions on an ongoing basis and may employ outside experts to assist in its evaluations. Changes in such estimates, based on more accurate future information, or different assumptions or conditions, may affect amounts reported in future periods. Deferred IPO costs Costs incurred that are directly related to the IPO, such as legal and accounting fees, registration fees, printing expenses, and other similar fees and expenses, totaling $9 million were capitalized and included within prepaid and other assets as of December 26, 2020. Upon completion of the IPO, the Company reclassified these costs, as well as an additional $6 million of IPO costs incurred during the nine months ended September 25, 2021, to Additional paid-in capital. Fair Value of Financial Instruments Financial assets and liabilities are categorized, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to the quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable inputs. Observable market data, when available, is required to be used in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. The Company classifies and discloses assets and liabilities carried at fair value in one of the following three categories: • Level 1: Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity as the ability to access at the measurement date; • Level 2: Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; or • Level 3: Inputs are unobservable inputs for the asset or liability. Unobservable inputs are used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. Financial assets and liabilities measured at fair value on a recurring basis as of September 25, 2021 and December 26, 2020 are summarized as follows: Items Measured at Fair Value at September 25, 2021 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 983 $ — $ 983 Foreign currency derivative liabilities not designated as hedging instruments $ — $ 509 $ 509 Items Measured at Fair Value at December 26, 2020 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 704 $ — $ 704 Foreign currency derivative assets not designated as hedging instruments — 227 227 Total assets measured at fair value on a recurring basis $ 704 $ 227 $ 931 Interest rate swap liabilities designated as hedging instruments $ — $ 9,561 $ 9,561 Cross currency swap liabilities not designated as hedging instruments — 12,197 12,197 Total derivative liabilities $ — $ 21,758 $ 21,758 The fair value of the Company’s foreign currency derivative instruments are derived from valuation models, which use Level 2 observable inputs such as quoted market prices, interest rates and forward yield curves. Derivative liabilities are included in long-term accrued expenses and other liabilities in the Consolidated Balance Sheet. The carrying values of cash, restricted cash, and receivables included in the Consolidated Balance Sheet approximate their fair value. The fair value of long-term debt is estimated based on Level 2 inputs using discounted cash flows and market-based expectations for interest rates, credit risk and contractual terms of the debt agreements. The carrying value and estimated fair value of total long-term debt were as follows: September 25, 2021 December 26, 2020 (in thousands) Carrying value Estimated fair value Carrying value Estimated fair value Long-term debt $ 1,695,679 $ 1,754,963 $ 2,125,207 $ 2,169,597 Accumulated Other Comprehensive Income (Loss) The following tables present changes in each component of accumulated other comprehensive income (loss), net of tax. Three months ended September 25, 2021 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at June 26, 2021 $ 19,002 $ (57) $ (91) $ 18,854 Net change (30,903) (1) 3 (30,901) Balance at September 25, 2021 $ (11,901) $ (58) $ (88) $ (12,047) Three months ended September 26, 2020 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at June 27, 2020 $ (7,489) $ — $ — $ (7,489) Net change (2,981) 552 — (2,429) Balance at September 26, 2020 $ (10,470) $ 552 $ — $ (9,918) Nine months ended September 25, 2021 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at December 26, 2020 $ 16,834 $ (87) $ (219) $ 16,528 Net change (28,735) 29 131 (28,575) Balance at September 25, 2021 $ (11,901) $ (58) $ (88) $ (12,047) Nine months ended September 26, 2020 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at December 28, 2019 $ 3,626 $ — $ — $ 3,626 Net change (14,096) 552 — (13,544) Balance at September 26, 2020 $ (10,470) $ 552 $ — $ (9,918) Recently Adopted Accounting Standards In December 2019, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , as part of its initiative to reduce complexity in accounting standards. The amendments in this ASU simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and improve consistency by clarifying and amending existing guidance. The Company adopted the ASU on December 27, 2020, and the adoption did not have a material impact on the Company’s consolidated financial statements. |
Acquisitions and Dispositions
Acquisitions and Dispositions | 9 Months Ended |
Sep. 25, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Dispositions | Acquisitions and DispositionsThe Company strategically acquires companies and assets in order to increase its footprint and offer products and services that diversify its existing offerings. These acquisitions are accounted for as either business combinations or asset acquisitions, whereby the purchase price is allocated to the assets acquired and liabilities assumed, based on their fair values as of the date of the acquisition. 2021 Acquisitions During the nine months ended September 25, 2021, the Company completed 25 acquisitions in the Car Wash segment, representing 66 car wash sites, each individually immaterial (the “2021 Car Wash Acquisitions”), which were deemed to be business combinations. The aggregate cash consideration for these acquisitions, net of cash acquired and liabilities assumed, was approximately $427 million. The provisional amounts for assets acquired and liabilities assumed for the 2021 Car Wash Acquisitions are as follows: (in thousands) Assets: Cash $ 161 Right of use assets 2,487 Land and improvements 46,495 Building 232,375 Equipment 46,063 Inventory 311 Intangibles, net 550 Deferred tax assets 212 Assets held for sale 996 Assets acquired 329,650 Liabilities: Accrued liability 356 Lease liability 2,587 Deferred tax liabilities 812 Liabilities assumed 3,755 Net assets acquired 325,895 Total consideration 427,236 Goodwill $ 101,341 We also acquired separately identifiable intangible assets certain of which have not presented above as the valuation has not yet been performed. All goodwill was allocated to the Car Wash segment and substantially all is deductible for income tax purposes. In addition, during the nine months ended September 25, 2021, the Company completed four acquisitions in the Maintenance segment representing four maintenance sites, each individually immaterial (the “2021 Maintenance Acquisitions”), which were deemed to be business combinations. The aggregate cash consideration for these acquisitions, net of cash acquired and liabilities assumed, was $8 million. The provisional amounts for assets acquired and liabilities assumed for the 2021 Maintenance Acquisitions are as follows: (in thousands) Assets: Land and improvements $ 1,590 Building 3,390 Equipment 850 Deferred tax assets 28 Assets acquired 5,858 Liabilities: Prepaid liability 20 Liabilities assumed 20 Net assets acquired 5,838 Total consideration 7,601 Goodwill $ 1,763 In addition, during the nine months ended September 25, 2021, the Company completed an acquisition of two collision sites, each individually immaterial, which are included within the Company’s Paint, Collision & Glass segment (the “2021 PC&G Acquisitions”), which were deemed to be business combinations. The aggregate cash consideration for these acquisitions, net of cash acquired and liabilities assumed, was $2 million. The provisional amounts for assets acquired and liabilities assumed for the 2021 PC&G Acquisitions are as follows: (in thousands) Assets: Right of use asset $ 1,067 Equipment 75 Intangibles, net 1,804 Deferred tax assets 23 Assets acquired 2,969 Liabilities: Accrued liability 5 Lease liability 1,089 Liabilities assumed 1,094 Net assets acquired 1,875 Total consideration 1,969 Goodwill $ 94 Included in the total consideration amounts above for the Car Wash and Maintenance acquisitions in 2021 was $8 million of consideration not paid on the closing date. The Company had $11 million of deferred consideration related to 2021 and 2020 acquisitions at September 25, 2021. The Company had $5 million of deferred consideration related to 2020 acquisitions at December 26, 2020. The Company paid $2 million of deferred consideration related to 2020 and prior acquisitions during the nine months ended September 25, 2021. Deferred consideration is typically paid six months to one-year after the acquisition closing date once all conditions under the purchase agreement have been satisfied. The Company incurred approximately $1 million of transaction costs during the nine months ended September 25, 2021. In addition, during the nine months ended September 25, 2021, the Company completed five acquisitions, each individually immaterial, each of which were deemed to be asset acquisitions as the fair value of assets acquired is substantially all land and buildings. Two of these acquisitions were included in the Car Wash segment and three were included in the Maintenance segment. The aggregate consideration paid for the Car Wash acquisitions and Maintenance acquisitions was $9 million and $2 million, respectively. 2021 Dispositions On April 27, 2021, the Company disposed of its 70% owned subsidiary, At-Pac Auto Parts Inc., for consideration of $2 million. As a result of the sale, a loss of less than $1 million was recognized within selling, general, and administrative expenses during the nine months ended September 25, 2021. Also, a noncontrolling interest of $1 million was derecognized. 2020 Acquisitions Acquisition of International Car Wash Group On August 3, 2020, the Company completed the acquisition of Shine Holdco (UK) Limited, the holding company of ICWG, to expand on its service offerings by entering into the car wash business (the “ICWG Acquisition”). The ICWG Acquisition resulted in the Company acquiring 940 car wash centers in 14 countries across the United States, Europe, and Australia. The following table presents the final purchase price allocation for the ICWG Acquisition, which was deemed to be a business combination: (in thousands, except shares) August 3, 2020 Assets: Cash $ 37,011 Accounts and notes receivable 2,591 Inventory 12,761 Fixed assets 692,486 Operating lease right-of-use assets 479,787 Definite-lived intangibles 5,972 Indefinite-lived intangibles 165,730 Other assets 7,476 Total assets acquired 1,403,814 Liabilities: Accounts payable 13,435 Long-term debt 656,684 Deferred income tax liability 134,130 Operating lease liabilities 476,216 Derivative liabilities 12,714 Other liabilities 82,307 Total liabilities assumed 1,375,486 Net assets acquired 28,328 Non-controlling interest acquired 400 Total consideration paid (39,169,857 common shares) (1) 809,000 Goodwill $ 781,072 (1) Common shares issued as consideration have been adjusted to reflect an implied 88,990-for-one stock split that became effective on January 14, 2021. See Note 1 for additional information. The fair value of the equity consideration was determined based on an estimated enterprise value using a market approach and income approach as of the purchase date, reduced by borrowings assumed. The Company finalized its purchase accounting estimates during the nine months ended September 25, 2021 related to the deferred tax liability and other liabilities and, as a result, reduced goodwill related to the ICWG Acquisition by approximately $1 million. Acquisition of Fix Auto On April 20, 2020, the Company acquired 100% of the outstanding equity of Fix Auto USA (“Fix Auto”), a franchisor and operator of collision repair centers, for $29 million, net of cash received of approximately $2 million. This acquisition resulted in the Company acquiring 150 franchised locations and 10 company-operated locations and increased the Company’s collision services footprint within the Paint, Collision & Glass segment. The following table presents the final purchase price allocation for the Fix Auto acquisition, which was deemed to be a business combination: (in thousands) April 20, 2020 Assets: Cash $ 2,020 Accounts and notes receivable, net 2,317 Inventory 414 Prepaid and other assets 293 Operating lease right-of-use assets 7,520 Property and equipment 1,023 Definite-lived intangibles 15,200 Assets acquired 28,787 Liabilities: Accounts payable 1,835 Accrued expenses and other liabilities 2,919 Operating lease liabilities 7,520 Income taxes payable 673 Deferred income tax liabilities 3,770 Liabilities assumed 16,717 Net assets acquired 12,070 Total consideration 31,460 Goodwill $ 19,390 A summary of total consideration for Fix Auto is as follows: (in thousands) Cash $ 28,517 Fair value of contingent consideration 2,943 Total consideration $ 31,460 The Company recorded a liability for the fair value of contingent consideration of $3 million associated with the Fix Auto acquisition, which was subsequently increased to $4 million at December 26, 2020. The Company recorded a $4 million benefit to Acquisition costs in the Consolidated Statement of Operations during the three and nine months ended September 25, 2021 related to the reversal of the liability as the payment of contingent consideration was deemed to be remote. Other Acquisitions During the fourth quarter of 2020, the Company completed the acquisition of 17 car wash sites, each individually immaterial, which are included within the Company’s Car Wash segment (the “2020 Car Wash Acquisitions”). The aggregate cash consideration paid for these acquisitions, net of cash acquired and liabilities assumed, was $109 million. The following table presents the final purchase price allocation for the 2020 Car Wash Acquisitions, which were deemed to be business combinations: (in thousands) Assets: Cash $ 41 Land and improvements 18,635 Building 42,570 Equipment 12,125 Deferred tax assets 5,117 Assets acquired 78,488 Liabilities: Deferred revenue 368 Liabilities assumed 368 Net assets acquired 78,120 Total consideration 108,771 Goodwill $ 30,651 The valuation for the acquisitions requires significant estimates and assumptions. The estimates are inherently uncertain and subject to revision as additional information is obtained during the measurement period for the acquisitions. There were no measurement period changes related to Fix Auto acquisition or the 2020 Car Wash Acquisitions during the nine months ended September 25, 2021. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 25, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers The Company records contract assets for the incremental costs of obtaining a contract with a customer if it expects the benefit of those costs to be longer than one year and if such costs are material. Commission expenses, a primary cost associated with the sale of franchise licenses, are amortized to selling, general and administrative expenses in the consolidated statements of operations ratably over the life of the associated franchise agreement. Capitalized costs to obtain a contract as of September 25, 2021 and December 26, 2020 were $10 million and $9 million, respectively, and are presented within deferred commissions on the consolidated balance sheets. The Company recognized an immaterial amount of costs during the three and nine months ended September 25, 2021 and September 26, 2020, respectively, that were recorded as a contract asset at the beginning of the period. Contract liabilities consist primarily of deferred franchise fees and deferred development fees. The Company had contract liabilities of $25 million and $21 million as of September 25, 2021 and December 26, 2020, respectively, which are presented within deferred revenue on the consolidated balance sheets. The Company recorded less than $1 million of revenue during both the three months ended September 25, 2021 and September 26, 2020, that was recorded as a contract liability as of the beginning of the period. The Company recorded $2 million and less than $1 million of revenue during the nine months ended September 25, 2021 and September 26, 2020, respectively, that was recorded as a contract liability as of the beginning of the period. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 25, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company’s worldwide operations are comprised of the following reportable segments: Maintenance; Car Wash; Paint, Collision & Glass; and Platform Services. The Car Wash segment was formed in connection with the acquisition of ICWG in August 2020. In addition to the reportable segments, the Company’s consolidated financial results include “Corporate and Other” activity. Corporate and Other incurs costs related to advertising fund revenu es and expenses and shared service costs, which are related to finance, IT, human resources, legal, supply chain and other support services. Corporate and Other activity includes the adjustments necessary to eliminate intercompany transactions, namely sales by the Platform Services segment to the Paint, Collision & Glass and Maintenance segments, respectively. Segment results for the three and nine months ended September 25, 2021 and September 26, 2020 are as follows: Three months ended September 25, 2021 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 9,635 $ — $ 20,280 $ 9,038 $ — $ 38,953 Company-operated store sales 125,561 74,105 12,723 1,465 (99) 213,755 Independently-operated store sales — 47,941 — — — 47,941 Advertising fund contributions — — — — 19,762 19,762 Supply and other revenue 9,261 1,516 17,572 31,558 (9,170) 50,737 Total revenue $ 144,457 $ 123,562 $ 50,575 $ 42,061 $ 10,493 $ 371,148 Segment Adjusted EBITDA $ 47,894 $ 37,999 $ 22,039 $ 16,254 $ (25,558) $ 98,628 Three months ended September 26, 2020 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 6,971 $ — $ 19,235 $ 10,599 $ (285) $ 36,520 Company-operated store sales 101,023 28,586 9,556 1,686 (63) 140,788 Independently-operated store sales — 30,595 — — — 30,595 Advertising fund contributions — $ — — — 14,927 14,927 Supply and other revenue 6,642 $ 4 18,281 27,370 (7,365) 44,932 Total revenue $ 114,636 $ 59,185 $ 47,072 $ 39,655 $ 7,214 $ 267,762 Segment Adjusted EBITDA $ 34,774 $ 17,739 $ 23,231 $ 13,306 $ (19,966) $ 69,084 Nine months ended September 25, 2021 (in thousands) Maintenance Car Wash Paint, Platform Services Corporate Total Franchise royalties and fees $ 26,651 $ — $ 57,578 $ 23,011 $ — $ 107,240 Company-operated store sales 365,735 196,858 37,672 3,911 (368) 603,808 Independently-operated store sales — 160,483 — — — 160,483 Advertising fund contributions — — — — 56,665 56,665 Supply and other revenue 25,231 4,800 49,791 94,576 (27,199) 147,199 Total revenue $ 417,617 $ 362,141 $ 145,041 $ 121,498 $ 29,098 $ 1,075,395 Segment Adjusted EBITDA $ 132,895 $ 115,223 $ 61,534 $ 44,864 $ (76,422) $ 278,094 Nine months ended September 26, 2020 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 21,028 $ — $ 52,220 $ 21,377 $ (411) $ 94,214 Company-operated store sales 268,267 28,586 21,613 5,020 (147) 323,339 Independently-operated store sales — 30,595 — — — 30,595 Advertising fund contributions — — — — 42,429 42,429 Supply and other revenue 16,552 4 47,287 80,184 (18,912) 125,115 Total revenue $ 305,847 $ 59,185 $ 121,120 $ 106,581 $ 22,959 $ 615,692 Segment Adjusted EBITDA $ 82,579 $ 17,739 $ 50,119 $ 36,740 $ (45,722) $ 141,455 The reconciliations of Segment Adjusted EBITDA to income before taxes for the three and nine months ended September 25, 2021 and September 26, 2020 are as follows: Three months ended Nine months ended (in thousands) September 25, 2021 September 26, 2020 September 25, 2021 September 26, 2020 Income before taxes $ 44,966 $ 9,999 $ 72,766 $ 9,364 Depreciation and amortization 28,447 16,221 78,722 32,656 Interest expense, net 17,688 29,594 52,390 64,973 Acquisition related costs (a) 636 12,076 2,674 13,287 Non-core items and project costs, net (b) 1,357 (2,690) 3,910 (926) Store opening costs 666 119 1,360 1,921 Sponsor management fees (c) — 4,278 — 5,357 Straight-line rent adjustment (d) 2,548 485 8,391 3,124 Equity-based compensation expense (e) 933 (182) 2,944 508 Foreign currency transaction (gain) / loss, net (f) 1,074 (2,230) 6,356 55 Bad debt expense — — — 2,842 Asset impairment and closed store expenses (g) 313 741 3,005 7,621 Loss on debt extinguishment (h) — 673 45,576 673 Segment Adjusted EBITDA $ 98,628 $ 69,084 $ 278,094 $ 141,455 (a) Consists of acquisition costs as reflected within the consolidated statements of operations, including legal, consulting and other fees and expenses incurred in connection with acquisitions completed during the applicable period, as well as inventory rationalization expenses incurred in connection with acquisitions. We expect to incur similar costs in connection with other acquisitions in the future and, under GAAP, such costs relating to acquisitions are expensed as incurred and not capitalized. (b) Consists of discrete items and project costs, including (i) third party consulting and professional fees associated with strategic transformation initiatives and (ii) other miscellaneous expenses, including non-capitalizable expenses relating to the Company’s initial public offering and other strategic transactions. (c) Includes management fees paid to Roark Capital Management, LLC. (d) Consists of the non-cash portion of rent expense, which reflects the extent to which our straight-line rent expense recognized under GAAP exceeds or is less than our cash rent payments. (e) Represents non-cash equity-based compensation expense. (f) Represents foreign currency transaction net gains and losses primarily related to the remeasurement of our intercompany loans. (g) Represents non-cash charges incurred related to the impairment of certain fixed assets and lease exit costs and other costs associated with stores that were closed prior to their respective lease terminations dates. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 25, 2021 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Our long-term debt obligations consist of the following: (in thousands) September 25, 2021 December 26, 2020 Series 2018-1 Securitization Senior Notes, Class A-2 $ 265,375 $ 267,438 Series 2019-1 Securitization Senior Notes, Class A-2 291,750 294,000 Series 2019-2 Securitization Senior Notes, Class A-2 269,500 271,563 Series 2020-1 Securitization Senior Notes, Class A-2 172,812 174,125 Series 2020-2 Securitization Senior Notes, Class A-2 446,625 450,000 Car Wash First Lien Term Loan (a) — 528,858 Car Wash Second Lien Term Loan (a) — 175,000 Car Wash Revolving Credit Facility (a) — 18,000 Driven Holdings Revolving Credit Facility 247,000 — Other debt (b) 34,923 26,763 Total debt 1,727,985 2,205,747 Less: unamortized discount — (46,030) Less: unamortized debt issuance costs (32,306) (34,510) Less: current portion of long-term debt (18,342) (22,988) Total long-term debt, net $ 1,677,337 $ 2,102,219 (a) Car Wash Senior Credit Facilities (b) Consists primarily of finance lease obligations. See Note 7 . As discussed in Note 1 , the Company used the proceeds from the IPO, along with cash on hand, to fully repay the Car Wash Senior Credit Facilities during the nine months ended September 25, 2021, which totaled $725 million including interest and fees. As a result, the Company incurred a $46 million loss on debt extinguishment related to the write-off of unamortized discount during the nine months ended September 25, 2021. Series 2019-3 Variable Funding Securitization Senior Notes In December 2019, the Company issued Series 2019-3 Variable Funding Senior Notes, Class A-1 (the “2019 VFN”) in the revolving amount of $115 million. The 2019 VFN have a final legal maturity date of January 20, 2050. The commitment under the 2019 VFN expires on July 20, 2022, and is subject to three one-year extensions at the election of the Company. The 2019 VFN is secured by substantially all assets of the Issuer and are guaranteed by the Securitization Entities. The Issuer may elect interest at the Base Rate plus an applicable margin or LIBOR plus an applicable margin (the LIBOR rate as the applicable interest rate). No amounts were outstanding under the 2019 VFN as of September 25, 2021. As of September 25, 2021, there were $15 million of outstanding letters of credit which reduced the borrowing availability under the 2019 VFN to $100 million. Driven Holdings Revolving Credit Facility In May 2021, the Company entered into a credit agreement to secure a revolving line of credit with a group of financial institutions (“Driven Holdings Revolving Credit Facility”), which provides for an aggregate principal amount of up to $300 million, and has a maturity date of May 27, 2026. Eurocurrency borrowings incur interest at an adjusted London Interbank Offered Rate (“LIBOR”) plus an applicable margin of 1.50%, which may increase to 1.75% based on the Net First Lien Leverage Ratio under the Driven Holdings Revolving Credit Facility. The Driven Holdings Revolving Credit Facility also includes periodic commitment fees based on the available unused balance and a quarterly administrative fee. As of September 25, 2021, there was $247 million outstanding on the Driven Holdings Revolving Credit Facility, with immaterial accrued interest at quarter-end. The Company’s debt agreements are subject to certain quantitative and qualitative covenants. As of September 25, 2021, the Company and its subsidiaries were in compliance with all covenants. |
Leases
Leases | 9 Months Ended |
Sep. 25, 2021 | |
Leases [Abstract] | |
Leases | Leases The following table details our total investment in operating and finance leases where the Company is the lessee: (in thousands) September 25, 2021 December 26, 2020 Right-of-use assets Finance leases (a) $ 28,422 $ 14,211 Operating leases 905,527 884,927 Total right-of-use assets $ 933,949 $ 899,138 Current lease liabilities Finance leases (b) $ 2,897 $ 2,149 Operating leases (c) 61,506 60,095 Total current lease liabilities $ 64,403 $ 62,244 Long-term lease liabilities Finance leases (d) $ 24,413 $ 16,726 Operating leases 843,925 818,001 Total long-term lease liabilities $ 868,338 $ 834,727 (a) Finance lease right-of-use assets are included in property and equipment, net on the consolidated balance sheet. (b) Current finance lease liabilities are included in current portion of long-term debt on the consolidated balance sheet. (c) Current operating lease liabilities are included in accrued expenses and other liabilities on the consolidated balance sheet. (d) Long-term finance lease liabilities are included in long-term debt on the consolidated balance sheet. The lease cost for operating and finance leases recognized in the consolidated statement of operations for the three and nine months ended September 25, 2021 and September 26, 2020 were as follows: Three months ended Nine months ended (in thousands) September 25, 2021 September 26, 2020 September 25, 2021 September 26, 2020 Finance lease expense: Amortization of right-of-use assets $ 715 $ 280 $ 1,970 $ 565 Interest on lease liabilities 299 163 796 375 Operating lease expense 29,028 20,874 85,564 46,180 Short-term lease expense 523 685 1,619 818 Variable lease expense 206 203 692 492 Total lease expense $ 30,771 $ 22,205 $ 90,641 $ 48,430 The Company also subleases certain facilities to franchisees as a component of supply and other revenue on the consolidated statements of operations. The Company recognized $2 million in sublease revenue in both the three months ended September 25, 2021 and September 26, 2020 and $5 million in both the nine months ended September 25, 2021 and September 26, 2020. During the nine months ended September 25, 2021, the Company sold 19 car wash and 3 maintenance properties in various locations throughout the United States for a total of $66 million, resulting in a net gain of $1 million. Concurrent with the closing of these sales, the Company entered into various operating lease agreements pursuant to which the Company leased back the properties. These lease agreements have terms ranging from 15 to 20 years and provide the Company with the option to extend the lease for up to an additional 20 years. The Company does not include option periods in its determination of the lease term unless renewals are deemed reasonably certain to be exercised. The Company recorded an operating lease right-of-use asset and operating lease liability of $62 million and $59 million, respectively, related to these lease arrangements. The weighted average remaining lease term as of September 25, 2021 was 11.5 years for finance leases and 14.8 years for operating leases. The weighted average discount rate as of September 25, 2021 was 5.33% for finance leases and 4.82% for operating leases. Supplemental cash flow information related to the Company’s lease arrangements for the nine months ended September 25, 2021 and September 26, 2020, respectively, was as follows: Nine months ended (in thousands) September 25, 2021 September 26, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 79,310 $ 40,898 Operating cash flows used in finance leases 736 360 Financing cash flows used in finance leases 921 197 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 75,268 $ 855,308 Finance leases 7,249 12,808 |
Share-based Compensation
Share-based Compensation | 9 Months Ended |
Sep. 25, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Compensation | Share-based Compensation On January 6, 2021, the Company’s Board of Directors approved the 2021 Omnibus Incentive Plan (the “Plan”) and effective January 14, 2021, the Company’s shareholders adopted and approved the Plan. The Plan provides for the granting of stock options, stock appreciation rights, restricted stock awards, restricted stock units, other stock-based awards, other cash-based awards or any combination of the foregoing to current and prospective employees and directors of, and consultants and advisors to, the Company and its affiliates. The maximum number of shares of common stock available for issuance under the Plan is 12,533,984 shares. In conjunction with the closing of the IPO, our Board granted awards under the Plan to certain of our employees, representing an aggregate of 5,582,522 shares of common stock. At September 25, 2021, 6,986,207 shares of common stock were reserved for additional grants under the Plan. Prior to IPO, the Parent’s equity awards included Profits Interest Units. There were two forms of Profits Interest - Time Units and Performance Units. Time Units generally vested in five installments of 20% on each of the first five The Performance Units were to vest immediately prior to the effective date of a consummated sale transaction or qualified public offering, including the IPO (a “Liquidity Event”). The percentage of vesting was based on achieving certain performance criteria. No vesting occurred as a result of the IPO as the minimum performance criteria threshold was not achieved. In connection with the IPO, the Performance Units were exchanged for performance-based restricted stock awards. The vesting conditions of the performance-based restricted stock awards were modified to vest subject to an additional performance condition. Employees who received IPO Options have the same vesting conditions for the performance-based portion of the IPO Options as the performance-based restricted stock awards. The Company calculated the fair value of these performance-based restricted stock awards on the modification date and determined the fair value of these awards increased to $66 million as a result of modification. In addition, the grant date fair value of the performance-based IPO Options was $26 million. The fair value of the performance-based restricted stock awards and performance-based IPO Options was determined by using a Monte Carlo simulation, using the following assumptions: (i) an expected term of 4.96 years, (ii) an expected volatility of 40.6%, (iii) a risk-free interest rate of 0.48%, and (iv) no expected dividends. There was approximately $6 million of unrecognized compensation expense related to the time-based restricted stock awards and time-based IPO Options at September 25, 2021, which is expected to be recognized over a weighted-average vesting period of 3.07 years. There was approximately $91 million of unrecognized compensation expense related to the performance-based restricted stock awards and performance-based IPO Options at September 25, 2021. For the three and nine months ended September 25, 2021 and September 26, 2020, no compensation cost was recognized for the performance-based restricted stock awards and performance-based IPO Options given that none of the performance criteria were met or probable. Once the performance conditions are deemed probable, the Company will recognize compensation cost equal to the portion of the requisite service period that has elapsed. Certain former employees continued to hold performance-based awards after the IPO. The Company established other new awards in connection with the IPO, including restricted stock units (“RSUs”) and performance stock units (“PSUs”). Awards established in connection with the IPO may only vest provided that the employee remains in continuous service on each vesting date. The RSUs vest in three installments of 33% on each of the first three At September 25, 2021, there was approximately $1 million of total unrecognized compensation cost related to the unvested RSUs, which is expected to be recognized over a weighted-average vesting period of 2.49 years, and there was approximately $2 million of total unrecognized compensation cost related to the unvested PSUs, which is expected to be recognized through December 30, 2023. For all of the Company’s awards, excluding RSUs and PSUs, if the grantee’s continuous service terminates for any reason, the grantee shall forfeit all right, title, and interest in and to any unvested units as of the date of such termination, unless the grantee’s continuous service period is terminated by the Company without cause within the six On January 6, 2021, the Company’s Board of Directors approved the Employee Stock Purchase Plan (the “ESPP”) and effective January 14, 2021, the Company’s shareholders adopted and approved the ESPP. The ESPP provides employees of the Company with an opportunity to purchase the Company’s common stock at a discount, subject to certain limitations set forth in the ESPP. The ESPP authorized the issuance of 1,790,569 shares of the Company’s common stock. The initial offering period is one year. As of September 25, 2021, there were no shares of common stock purchased under the ESPP. On March 22, 2021, the Company's Board of Directors approved the International Employee Stock Purchase Plan (the "International ESPP") that provides employees of certain designated subsidiaries of the Company with an opportunity to purchase the Company's common stock at a discount, subject to certain limitations set forth in the International ESPP. The shares available under the International ESPP are subject to available shares under the ESPP. |
Earnings per share
Earnings per share | 9 Months Ended |
Sep. 25, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share The Company calculates basic and diluted earnings per share using the two-class method. The following table sets forth the computation of basic and diluted earnings per share attributable to common shareholders: Three months ended Nine months ended (in thousands, except per share amounts) September 25, 2021 September 26, 2020 September 25, 2021 September 26, 2020 Basic earnings per share: Net income attributable to Driven Brands Holdings Inc. $ 33,124 4,079 48,389 3,289 Less: Net income attributable to participating securities, basic 709 — 1,057 — Net income after participating securities, basic 32,415 4,079 47,332 3,289 Weighted-average common shares outstanding (a) 162,635 111,950 160,030 96,643 Basic earnings per share $ 0.20 $ 0.04 $ 0.30 $ 0.03 Diluted earnings per share: Net income attributable to Driven Brands Holdings Inc. 33,124 4,079 48,389 3,289 Less: Net income attributable to participating securities, diluted 632 — 942 — Net income after participating securities, diluted 32,492 4,079 47,447 3,289 Weighted-average common shares outstanding (a) 162,635 111,950 160,030 96,643 Dilutive effect of share-based awards 3,995 — 3,938 — Weighted-average common shares outstanding, as adjusted (a) 166,630 111,950 163,968 96,643 Diluted earnings per share $ 0.19 $ 0.04 $ 0.29 $ 0.03 (a) Weighted average common shares for 2020 have been adjusted to reflect an implied 88,990-for-one stock split that became effective on January 14, 2021. See Note 1 for additional information. Basic earnings (loss) per share is computed by dividing the net income (loss) attributable to Driven Brands Holdings Inc. by the weighted-average number of common shares outstanding for the period. In addition, the Company’s participating securities are related to certain restricted stock awards issued to Section 16 officers which include non-forfeitable dividend rights. The Company has 4,618,722 shares of performance awards that are contingent on performance conditions which have not yet been met, and therefore have been excluded from the computation of weighted average shares for the three and nine months ended September 25, 2021. The following securities were not included in the computation of diluted shares outstanding because the effect would be antidilutive: Number of securities (in thousands) Three Months Ended Nine months ended Restricted stock units — 2 Stock options — 36 Total — 38 |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Sep. 25, 2021 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party TransactionsThe Company had management advisory services agreements with Roark Capital Management, LLC (“Roark”), an affiliated entity, which provided that the Company pay an annual advisory services fee to Roark. The Company and Roark terminated all advisory services agreements in January 2021 in connection with the Company’s initial public offering. The Company paid $4 million and $5 million under these service agreements during the three and nine months ended September 26, 2020, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 25, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is subject to various lawsuits, administrative proceedings, audits, and claims arising in the ordinary course of business. Some of these lawsuits purport to be class actions and/or seek substantial damages. The Company is required to record an accrual for litigation loss contingencies that are both probable and reasonably estimable. Legal fees and expenses associated with the defense of litigation are expensed as incurred. While the Company does not presently believe that any of the legal proceedings to which it is currently a party will ultimately have a material adverse impact, there can be no assurance that the Company will prevail in all of the proceedings or that the Company will not incur material losses from them. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 25, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On September 29, 2021, Driven Brands Funding, LLC and Driven Brands Canada Funding Corporation (together, the “Co-Issuers”), each wholly owned indirect subsidiaries of the Company issued $450 million of 2021-1 Securitization Senior Notes, Class A-2, bearing a fixed interest rate of 2.791% per annum, a final legal maturity date of October 20, 2051 and an anticipated repayment date of October 20, 2028 (the “2021 Senior Notes”). The proceeds from the issuance of the 2021 Senior Notes have been used to pay off the outstanding $247 million balance on the Driven Holdings Revolving Credit Facility with the remainder to be used for general corporate purposes including future acquisitions. On November 9, 2021, the Company made a draw of $10 million on the Driven Holdings Revolving Credit Facility. On September 30, 2021, the Company acquired 10 CARSTAR franchise locations for $31 million. The initial accounting for this acquisition is incomplete as the valuation of the assets acquired and liabilities assumed and residual goodwill has not yet been performed. From September 26, 2021 through November 9, 2021 the Company acquired 20 car wash sites for $123 million. The initial accounting for these acquisitions is incomplete as the valuati on of the assets acquired and liabilities assumed and residual goodwill has not yet been performed. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 25, 2021 | |
Accounting Policies [Abstract] | |
Fiscal Year | The Company operates and reports financial information on a 52- or 53-week year with the fiscal year ending on the last Saturday in December and fiscal quarters ending on the 13th Saturday of each quarter (or 14th Saturday when applicable with respect to the fourth fiscal quarter). The three and nine months ended September 25, 2021 and September 26, 2020, each consist of 13 and 39 weeks, respectively. The Car Wash segment (primarily ICWG which was acquired in August 2020) is currently consolidated based on a calendar month end. |
Basis of Presentation | The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of results of operations, balance sheet, cash flows, and shareholders’ equity for the periods presented have been reflected. The adjustments include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. These interim consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the year ended December 26, 2020. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The results of operations for the three and nine months ended September 25, 2021 may not be indicative of the results to be expected for any other interim period or the year ending December 25, 2021. |
Use of Estimates | The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the related notes to the consolidated financial statements. Estimates are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. Management evaluates its estimates and assumptions on an ongoing basis and may employ outside experts to assist in its evaluations. Changes in such estimates, based on more accurate future information, or different assumptions or conditions, may affect amounts reported in future periods. |
Fair Value of Financial Instruments | Financial assets and liabilities are categorized, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to the quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable inputs. Observable market data, when available, is required to be used in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. The Company classifies and discloses assets and liabilities carried at fair value in one of the following three categories: • Level 1: Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity as the ability to access at the measurement date; • Level 2: Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; or • Level 3: Inputs are unobservable inputs for the asset or liability. Unobservable inputs are used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. |
Derivative Instruments | The fair value of the Company’s foreign currency derivative instruments are derived from valuation models, which use Level 2 observable inputs such as quoted market prices, interest rates and forward yield curves. Derivative liabilities are included in long-term accrued expenses and other liabilities in the Consolidated Balance Sheet. |
Recently Adopted Accounting Standards | In December 2019, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , as part of its initiative to reduce complexity in accounting standards. The amendments in this ASU simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and improve consistency by clarifying and amending existing guidance. The Company adopted the ASU on December 27, 2020, and the adoption did not have a material impact on the Company’s consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 25, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis as of September 25, 2021 and December 26, 2020 are summarized as follows: Items Measured at Fair Value at September 25, 2021 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 983 $ — $ 983 Foreign currency derivative liabilities not designated as hedging instruments $ — $ 509 $ 509 Items Measured at Fair Value at December 26, 2020 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 704 $ — $ 704 Foreign currency derivative assets not designated as hedging instruments — 227 227 Total assets measured at fair value on a recurring basis $ 704 $ 227 $ 931 Interest rate swap liabilities designated as hedging instruments $ — $ 9,561 $ 9,561 Cross currency swap liabilities not designated as hedging instruments — 12,197 12,197 Total derivative liabilities $ — $ 21,758 $ 21,758 |
Schedule of Carrying Values and Estimated Fair Value of Total Long-Term Debt | The carrying value and estimated fair value of total long-term debt were as follows: September 25, 2021 December 26, 2020 (in thousands) Carrying value Estimated fair value Carrying value Estimated fair value Long-term debt $ 1,695,679 $ 1,754,963 $ 2,125,207 $ 2,169,597 |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following tables present changes in each component of accumulated other comprehensive income (loss), net of tax. Three months ended September 25, 2021 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at June 26, 2021 $ 19,002 $ (57) $ (91) $ 18,854 Net change (30,903) (1) 3 (30,901) Balance at September 25, 2021 $ (11,901) $ (58) $ (88) $ (12,047) Three months ended September 26, 2020 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at June 27, 2020 $ (7,489) $ — $ — $ (7,489) Net change (2,981) 552 — (2,429) Balance at September 26, 2020 $ (10,470) $ 552 $ — $ (9,918) Nine months ended September 25, 2021 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at December 26, 2020 $ 16,834 $ (87) $ (219) $ 16,528 Net change (28,735) 29 131 (28,575) Balance at September 25, 2021 $ (11,901) $ (58) $ (88) $ (12,047) Nine months ended September 26, 2020 (in thousands) Foreign currency translation adjustment Cash flow hedges Defined benefit pension plan Accumulated other comprehensive income (loss) Balance at December 28, 2019 $ 3,626 $ — $ — $ 3,626 Net change (14,096) 552 — (13,544) Balance at September 26, 2020 $ (10,470) $ 552 $ — $ (9,918) |
Acquisitions and Dispositions (
Acquisitions and Dispositions (Tables) | 9 Months Ended |
Sep. 25, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Estimated Purchase Price Allocation | The provisional amounts for assets acquired and liabilities assumed for the 2021 Car Wash Acquisitions are as follows: (in thousands) Assets: Cash $ 161 Right of use assets 2,487 Land and improvements 46,495 Building 232,375 Equipment 46,063 Inventory 311 Intangibles, net 550 Deferred tax assets 212 Assets held for sale 996 Assets acquired 329,650 Liabilities: Accrued liability 356 Lease liability 2,587 Deferred tax liabilities 812 Liabilities assumed 3,755 Net assets acquired 325,895 Total consideration 427,236 Goodwill $ 101,341 (in thousands) Assets: Land and improvements $ 1,590 Building 3,390 Equipment 850 Deferred tax assets 28 Assets acquired 5,858 Liabilities: Prepaid liability 20 Liabilities assumed 20 Net assets acquired 5,838 Total consideration 7,601 Goodwill $ 1,763 The provisional amounts for assets acquired and liabilities assumed for the 2021 PC&G Acquisitions are as follows: (in thousands) Assets: Right of use asset $ 1,067 Equipment 75 Intangibles, net 1,804 Deferred tax assets 23 Assets acquired 2,969 Liabilities: Accrued liability 5 Lease liability 1,089 Liabilities assumed 1,094 Net assets acquired 1,875 Total consideration 1,969 Goodwill $ 94 (in thousands, except shares) August 3, 2020 Assets: Cash $ 37,011 Accounts and notes receivable 2,591 Inventory 12,761 Fixed assets 692,486 Operating lease right-of-use assets 479,787 Definite-lived intangibles 5,972 Indefinite-lived intangibles 165,730 Other assets 7,476 Total assets acquired 1,403,814 Liabilities: Accounts payable 13,435 Long-term debt 656,684 Deferred income tax liability 134,130 Operating lease liabilities 476,216 Derivative liabilities 12,714 Other liabilities 82,307 Total liabilities assumed 1,375,486 Net assets acquired 28,328 Non-controlling interest acquired 400 Total consideration paid (39,169,857 common shares) (1) 809,000 Goodwill $ 781,072 (1) Common shares issued as consideration have been adjusted to reflect an implied 88,990-for-one stock split that became effective on January 14, 2021. See Note 1 for additional information. The following table presents the final purchase price allocation for the Fix Auto acquisition, which was deemed to be a business combination: (in thousands) April 20, 2020 Assets: Cash $ 2,020 Accounts and notes receivable, net 2,317 Inventory 414 Prepaid and other assets 293 Operating lease right-of-use assets 7,520 Property and equipment 1,023 Definite-lived intangibles 15,200 Assets acquired 28,787 Liabilities: Accounts payable 1,835 Accrued expenses and other liabilities 2,919 Operating lease liabilities 7,520 Income taxes payable 673 Deferred income tax liabilities 3,770 Liabilities assumed 16,717 Net assets acquired 12,070 Total consideration 31,460 Goodwill $ 19,390 A summary of total consideration for Fix Auto is as follows: (in thousands) Cash $ 28,517 Fair value of contingent consideration 2,943 Total consideration $ 31,460 The following table presents the final purchase price allocation for the 2020 Car Wash Acquisitions, which were deemed to be business combinations: (in thousands) Assets: Cash $ 41 Land and improvements 18,635 Building 42,570 Equipment 12,125 Deferred tax assets 5,117 Assets acquired 78,488 Liabilities: Deferred revenue 368 Liabilities assumed 368 Net assets acquired 78,120 Total consideration 108,771 Goodwill $ 30,651 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 25, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Results | Segment results for the three and nine months ended September 25, 2021 and September 26, 2020 are as follows: Three months ended September 25, 2021 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 9,635 $ — $ 20,280 $ 9,038 $ — $ 38,953 Company-operated store sales 125,561 74,105 12,723 1,465 (99) 213,755 Independently-operated store sales — 47,941 — — — 47,941 Advertising fund contributions — — — — 19,762 19,762 Supply and other revenue 9,261 1,516 17,572 31,558 (9,170) 50,737 Total revenue $ 144,457 $ 123,562 $ 50,575 $ 42,061 $ 10,493 $ 371,148 Segment Adjusted EBITDA $ 47,894 $ 37,999 $ 22,039 $ 16,254 $ (25,558) $ 98,628 Three months ended September 26, 2020 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 6,971 $ — $ 19,235 $ 10,599 $ (285) $ 36,520 Company-operated store sales 101,023 28,586 9,556 1,686 (63) 140,788 Independently-operated store sales — 30,595 — — — 30,595 Advertising fund contributions — $ — — — 14,927 14,927 Supply and other revenue 6,642 $ 4 18,281 27,370 (7,365) 44,932 Total revenue $ 114,636 $ 59,185 $ 47,072 $ 39,655 $ 7,214 $ 267,762 Segment Adjusted EBITDA $ 34,774 $ 17,739 $ 23,231 $ 13,306 $ (19,966) $ 69,084 Nine months ended September 25, 2021 (in thousands) Maintenance Car Wash Paint, Platform Services Corporate Total Franchise royalties and fees $ 26,651 $ — $ 57,578 $ 23,011 $ — $ 107,240 Company-operated store sales 365,735 196,858 37,672 3,911 (368) 603,808 Independently-operated store sales — 160,483 — — — 160,483 Advertising fund contributions — — — — 56,665 56,665 Supply and other revenue 25,231 4,800 49,791 94,576 (27,199) 147,199 Total revenue $ 417,617 $ 362,141 $ 145,041 $ 121,498 $ 29,098 $ 1,075,395 Segment Adjusted EBITDA $ 132,895 $ 115,223 $ 61,534 $ 44,864 $ (76,422) $ 278,094 Nine months ended September 26, 2020 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 21,028 $ — $ 52,220 $ 21,377 $ (411) $ 94,214 Company-operated store sales 268,267 28,586 21,613 5,020 (147) 323,339 Independently-operated store sales — 30,595 — — — 30,595 Advertising fund contributions — — — — 42,429 42,429 Supply and other revenue 16,552 4 47,287 80,184 (18,912) 125,115 Total revenue $ 305,847 $ 59,185 $ 121,120 $ 106,581 $ 22,959 $ 615,692 Segment Adjusted EBITDA $ 82,579 $ 17,739 $ 50,119 $ 36,740 $ (45,722) $ 141,455 |
Reconciliation of Segment Adjusted EBITDA to Income Before Taxes | The reconciliations of Segment Adjusted EBITDA to income before taxes for the three and nine months ended September 25, 2021 and September 26, 2020 are as follows: Three months ended Nine months ended (in thousands) September 25, 2021 September 26, 2020 September 25, 2021 September 26, 2020 Income before taxes $ 44,966 $ 9,999 $ 72,766 $ 9,364 Depreciation and amortization 28,447 16,221 78,722 32,656 Interest expense, net 17,688 29,594 52,390 64,973 Acquisition related costs (a) 636 12,076 2,674 13,287 Non-core items and project costs, net (b) 1,357 (2,690) 3,910 (926) Store opening costs 666 119 1,360 1,921 Sponsor management fees (c) — 4,278 — 5,357 Straight-line rent adjustment (d) 2,548 485 8,391 3,124 Equity-based compensation expense (e) 933 (182) 2,944 508 Foreign currency transaction (gain) / loss, net (f) 1,074 (2,230) 6,356 55 Bad debt expense — — — 2,842 Asset impairment and closed store expenses (g) 313 741 3,005 7,621 Loss on debt extinguishment (h) — 673 45,576 673 Segment Adjusted EBITDA $ 98,628 $ 69,084 $ 278,094 $ 141,455 (a) Consists of acquisition costs as reflected within the consolidated statements of operations, including legal, consulting and other fees and expenses incurred in connection with acquisitions completed during the applicable period, as well as inventory rationalization expenses incurred in connection with acquisitions. We expect to incur similar costs in connection with other acquisitions in the future and, under GAAP, such costs relating to acquisitions are expensed as incurred and not capitalized. (b) Consists of discrete items and project costs, including (i) third party consulting and professional fees associated with strategic transformation initiatives and (ii) other miscellaneous expenses, including non-capitalizable expenses relating to the Company’s initial public offering and other strategic transactions. (c) Includes management fees paid to Roark Capital Management, LLC. (d) Consists of the non-cash portion of rent expense, which reflects the extent to which our straight-line rent expense recognized under GAAP exceeds or is less than our cash rent payments. (e) Represents non-cash equity-based compensation expense. (f) Represents foreign currency transaction net gains and losses primarily related to the remeasurement of our intercompany loans. (g) Represents non-cash charges incurred related to the impairment of certain fixed assets and lease exit costs and other costs associated with stores that were closed prior to their respective lease terminations dates. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 25, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Our long-term debt obligations consist of the following: (in thousands) September 25, 2021 December 26, 2020 Series 2018-1 Securitization Senior Notes, Class A-2 $ 265,375 $ 267,438 Series 2019-1 Securitization Senior Notes, Class A-2 291,750 294,000 Series 2019-2 Securitization Senior Notes, Class A-2 269,500 271,563 Series 2020-1 Securitization Senior Notes, Class A-2 172,812 174,125 Series 2020-2 Securitization Senior Notes, Class A-2 446,625 450,000 Car Wash First Lien Term Loan (a) — 528,858 Car Wash Second Lien Term Loan (a) — 175,000 Car Wash Revolving Credit Facility (a) — 18,000 Driven Holdings Revolving Credit Facility 247,000 — Other debt (b) 34,923 26,763 Total debt 1,727,985 2,205,747 Less: unamortized discount — (46,030) Less: unamortized debt issuance costs (32,306) (34,510) Less: current portion of long-term debt (18,342) (22,988) Total long-term debt, net $ 1,677,337 $ 2,102,219 (a) Car Wash Senior Credit Facilities (b) Consists primarily of finance lease obligations. See Note 7 . |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 25, 2021 | |
Leases [Abstract] | |
Supplemental Balance Sheet Information | The following table details our total investment in operating and finance leases where the Company is the lessee: (in thousands) September 25, 2021 December 26, 2020 Right-of-use assets Finance leases (a) $ 28,422 $ 14,211 Operating leases 905,527 884,927 Total right-of-use assets $ 933,949 $ 899,138 Current lease liabilities Finance leases (b) $ 2,897 $ 2,149 Operating leases (c) 61,506 60,095 Total current lease liabilities $ 64,403 $ 62,244 Long-term lease liabilities Finance leases (d) $ 24,413 $ 16,726 Operating leases 843,925 818,001 Total long-term lease liabilities $ 868,338 $ 834,727 (a) Finance lease right-of-use assets are included in property and equipment, net on the consolidated balance sheet. (b) Current finance lease liabilities are included in current portion of long-term debt on the consolidated balance sheet. (c) Current operating lease liabilities are included in accrued expenses and other liabilities on the consolidated balance sheet. |
Schedule of Lease Cost and Supplemental Cash Flow Information | The lease cost for operating and finance leases recognized in the consolidated statement of operations for the three and nine months ended September 25, 2021 and September 26, 2020 were as follows: Three months ended Nine months ended (in thousands) September 25, 2021 September 26, 2020 September 25, 2021 September 26, 2020 Finance lease expense: Amortization of right-of-use assets $ 715 $ 280 $ 1,970 $ 565 Interest on lease liabilities 299 163 796 375 Operating lease expense 29,028 20,874 85,564 46,180 Short-term lease expense 523 685 1,619 818 Variable lease expense 206 203 692 492 Total lease expense $ 30,771 $ 22,205 $ 90,641 $ 48,430 Supplemental cash flow information related to the Company’s lease arrangements for the nine months ended September 25, 2021 and September 26, 2020, respectively, was as follows: Nine months ended (in thousands) September 25, 2021 September 26, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 79,310 $ 40,898 Operating cash flows used in finance leases 736 360 Financing cash flows used in finance leases 921 197 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 75,268 $ 855,308 Finance leases 7,249 12,808 |
Earnings per share (Tables)
Earnings per share (Tables) | 9 Months Ended |
Sep. 25, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Loss Per Share | The following table sets forth the computation of basic and diluted earnings per share attributable to common shareholders: Three months ended Nine months ended (in thousands, except per share amounts) September 25, 2021 September 26, 2020 September 25, 2021 September 26, 2020 Basic earnings per share: Net income attributable to Driven Brands Holdings Inc. $ 33,124 4,079 48,389 3,289 Less: Net income attributable to participating securities, basic 709 — 1,057 — Net income after participating securities, basic 32,415 4,079 47,332 3,289 Weighted-average common shares outstanding (a) 162,635 111,950 160,030 96,643 Basic earnings per share $ 0.20 $ 0.04 $ 0.30 $ 0.03 Diluted earnings per share: Net income attributable to Driven Brands Holdings Inc. 33,124 4,079 48,389 3,289 Less: Net income attributable to participating securities, diluted 632 — 942 — Net income after participating securities, diluted 32,492 4,079 47,447 3,289 Weighted-average common shares outstanding (a) 162,635 111,950 160,030 96,643 Dilutive effect of share-based awards 3,995 — 3,938 — Weighted-average common shares outstanding, as adjusted (a) 166,630 111,950 163,968 96,643 Diluted earnings per share $ 0.19 $ 0.04 $ 0.29 $ 0.03 (a) Weighted average common shares for 2020 have been adjusted to reflect an implied 88,990-for-one stock split that became effective on January 14, 2021. See Note 1 for additional information. |
Schedule of Antidilutive Shares | The following securities were not included in the computation of diluted shares outstanding because the effect would be antidilutive: Number of securities (in thousands) Three Months Ended Nine months ended Restricted stock units — 2 Stock options — 36 Total — 38 |
Description of Business (Detail
Description of Business (Details) $ / shares in Units, $ in Thousands | Sep. 08, 2021shares | Aug. 02, 2021$ / sharesshares | Feb. 10, 2021shares | Jan. 14, 2021USD ($)$ / sharesshares | Feb. 10, 2021USD ($) | Sep. 25, 2021USD ($)franchise_locationshares | Sep. 26, 2020USD ($) | Sep. 25, 2021USD ($)franchise_locationshares | Sep. 26, 2020USD ($) | Jan. 13, 2021shares | Dec. 26, 2020shares |
Subsidiary, Sale of Stock [Line Items] | |||||||||||
Number of locations franchised, independently-operated, and company-operated | franchise_location | 4,300 | 4,300 | |||||||||
Number of states in which entity operates | franchise_location | 49 | 49 | |||||||||
Number of countries across Europe in which entity operates | franchise_location | 14 | 14 | |||||||||
Percentage of locations franchised or independently operated | 0.81 | 0.81 | |||||||||
Repayment of debt | $ | $ 725,000 | $ 725,000 | |||||||||
Loss on debt extinguishment | $ | $ 46,000 | $ 0 | $ 673 | $ 45,576 | $ 673 | ||||||
Stock split | 88,990 | ||||||||||
Number of authorized shares (in shares) | 1,000,000,000 | 10,000 | |||||||||
Number of shares authorized (in shares) | 900,000,000 | 900,000,000 | 900,000,000 | 900,000,000 | |||||||
Number of shares of preferred stock authorized (in shares) | 100,000,000 | ||||||||||
Pre-IPO Stockholders | |||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||
Income taxes receivable (percent) | 0.85 | ||||||||||
IPO | |||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||
Sale of stock (in shares) | 32,000,000 | ||||||||||
Sale of stock (in dollars per share) | $ / shares | $ 22 | ||||||||||
Total proceeds received | $ | $ 761,000 | ||||||||||
Number of shares purchased from existing shareholders (in shares) | 2,000,000 | ||||||||||
Over-Allotment Option | |||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||
Sale of stock (in shares) | 881,393 | 5,000,000 | |||||||||
Total proceeds received | $ | $ 43,000 | ||||||||||
Secondary Offering | |||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||
Sale of stock (in shares) | 12,000,000 | ||||||||||
Sale of stock (in dollars per share) | $ / shares | $ 29.5 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Mar. 27, 2021 | Sep. 25, 2021 | Dec. 26, 2020 | |
Reclassification [Line Items] | |||
Capitalized stock issuance cost | $ 9,000 | ||
Stock issuance cost | $ 14,757 | ||
IPO | |||
Reclassification [Line Items] | |||
Stock issuance cost | $ 6,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Sep. 25, 2021 | Dec. 26, 2020 |
Subsidiary, Sale of Stock [Line Items] | ||
Mutual fund investments held in rabbi trust | $ 704 | |
Total assets measured at fair value on a recurring basis | $ 983 | 931 |
Total derivative liabilities | 509 | 21,758 |
Designated as Hedging Instrument | ||
Subsidiary, Sale of Stock [Line Items] | ||
Foreign currency derivative liabilities | 9,561 | |
Not Designated as Hedging Instrument | ||
Subsidiary, Sale of Stock [Line Items] | ||
Foreign currency derivative assets not designated as hedging instruments | 227 | |
Foreign currency derivative liabilities | 12,197 | |
Fair Value, Inputs, Level 1 | ||
Subsidiary, Sale of Stock [Line Items] | ||
Mutual fund investments held in rabbi trust | 704 | |
Total assets measured at fair value on a recurring basis | 983 | 704 |
Total derivative liabilities | 0 | 0 |
Fair Value, Inputs, Level 1 | Designated as Hedging Instrument | ||
Subsidiary, Sale of Stock [Line Items] | ||
Foreign currency derivative liabilities | 0 | |
Fair Value, Inputs, Level 1 | Not Designated as Hedging Instrument | ||
Subsidiary, Sale of Stock [Line Items] | ||
Foreign currency derivative assets not designated as hedging instruments | 0 | |
Foreign currency derivative liabilities | 0 | |
Fair Value, Inputs, Level 2 | ||
Subsidiary, Sale of Stock [Line Items] | ||
Mutual fund investments held in rabbi trust | 0 | |
Total assets measured at fair value on a recurring basis | 0 | 227 |
Total derivative liabilities | $ 509 | 21,758 |
Fair Value, Inputs, Level 2 | Designated as Hedging Instrument | ||
Subsidiary, Sale of Stock [Line Items] | ||
Foreign currency derivative liabilities | 9,561 | |
Fair Value, Inputs, Level 2 | Not Designated as Hedging Instrument | ||
Subsidiary, Sale of Stock [Line Items] | ||
Foreign currency derivative assets not designated as hedging instruments | 227 | |
Foreign currency derivative liabilities | $ 12,197 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Carrying Values and Estimated Fair Value of Total Long-Term Debt (Details) - USD ($) $ in Thousands | Sep. 25, 2021 | Dec. 26, 2020 |
Accounting Policies [Abstract] | ||
Carrying value | $ 1,695,679 | $ 2,125,207 |
Estimated fair value | $ 1,754,963 | $ 2,169,597 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2021 | Sep. 26, 2020 | Sep. 25, 2021 | Sep. 26, 2020 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 1,671,942 | $ 1,106,360 | $ 289,878 | |
Net change | (30,901) | $ (2,429) | (28,575) | (13,544) |
Ending balance | 1,675,497 | 1,083,688 | 1,675,497 | 1,083,688 |
Accumulated other comprehensive income (loss) | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 18,854 | (7,489) | 16,528 | 3,626 |
Ending balance | (12,047) | (9,918) | (12,047) | (9,918) |
Foreign currency translation adjustment | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 19,002 | (7,489) | 16,834 | 3,626 |
Net change | (30,903) | (2,981) | (28,735) | (14,096) |
Ending balance | (11,901) | (10,470) | (11,901) | (10,470) |
Cash flow hedges | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (57) | 0 | (87) | 0 |
Net change | (1) | 552 | 29 | 552 |
Ending balance | (58) | 552 | (58) | 552 |
Defined benefit pension plan | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (91) | 0 | (219) | 0 |
Net change | 3 | 0 | 131 | 0 |
Ending balance | $ (88) | $ 0 | $ (88) | $ 0 |
Acquisitions and Dispositions -
Acquisitions and Dispositions - Narrative (Details) $ in Thousands | Apr. 27, 2021USD ($) | Aug. 03, 2020USD ($)countrywash_center | Apr. 20, 2020USD ($)franchise_location | Sep. 25, 2021USD ($)franchise_location | Jun. 26, 2021USD ($) | Dec. 26, 2020USD ($)car_wash_site | Sep. 25, 2021USD ($)franchise_location | Sep. 25, 2021USD ($)franchise_location | Sep. 25, 2021USD ($)acquisitionfranchise_location | Sep. 25, 2021USD ($)car_wash_sitefranchise_location | Sep. 25, 2021USD ($)maintenance_sitefranchise_location | Sep. 25, 2021USD ($)collision_sitefranchise_location | Sep. 25, 2021USD ($)franchise_locationacquistion | Sep. 26, 2020USD ($) | Dec. 26, 2020USD ($) |
Business Acquisition [Line Items] | |||||||||||||||
Cash used in business acquisitions, net of cash acquired | $ 442,488 | $ (8,575) | |||||||||||||
Payment of contingent consideration related to acquisitions | 0 | $ 2,783 | |||||||||||||
Transaction expense | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | |||||||
Number of countries across Europe in which entity operates | franchise_location | 14 | 14 | 14 | 14 | 14 | 14 | 14 | 14 | |||||||
Reduction of goodwill | $ (1,810,085) | $ (1,727,351) | $ (1,810,085) | $ (1,810,085) | $ (1,810,085) | $ (1,810,085) | $ (1,810,085) | $ (1,810,085) | $ (1,810,085) | $ (1,727,351) | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||
Net loss on disposal (less than) | (1,000) | ||||||||||||||
Derecognized noncontrolling interest | $ 948 | ||||||||||||||
Minimum | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Deferred consideration payment period | 6 months | ||||||||||||||
Maximum | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Deferred consideration payment period | 1 year | ||||||||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||
Ownership interest disposed of | 70.00% | ||||||||||||||
Consideration received | $ 2,000 | ||||||||||||||
Net loss on disposal (less than) | 1,000 | 1,000 | |||||||||||||
Derecognized noncontrolling interest | 1,000 | ||||||||||||||
2021 Cash Wash And Maintenance Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Deferred consideration | 8,000 | $ 8,000 | 8,000 | $ 8,000 | $ 8,000 | 8,000 | 8,000 | 8,000 | |||||||
2021 Car Wash Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | 25 | 66 | |||||||||||||
Cash used in business acquisitions, net of cash acquired | 427,000 | ||||||||||||||
Reduction of goodwill | (101,341) | (101,341) | (101,341) | $ (101,341) | $ (101,341) | $ (101,341) | (101,341) | (101,341) | |||||||
2021 Maintenance Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | 4 | 4 | |||||||||||||
Cash used in business acquisitions, net of cash acquired | 7,601 | ||||||||||||||
Reduction of goodwill | (1,763) | (1,763) | (1,763) | $ (1,763) | (1,763) | $ (1,763) | $ (1,763) | (1,763) | |||||||
2021 PC&G Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | collision_site | 2 | ||||||||||||||
Cash used in business acquisitions, net of cash acquired | 2,000 | ||||||||||||||
Reduction of goodwill | (94) | (94) | (94) | (94) | (94) | (94) | $ (94) | (94) | |||||||
2021 Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Deferred consideration | 11,000 | 11,000 | 11,000 | 11,000 | 11,000 | 11,000 | 11,000 | 11,000 | |||||||
2020 Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Deferred consideration | 11,000 | $ 5,000 | 11,000 | 11,000 | $ 11,000 | 11,000 | 11,000 | 11,000 | $ 11,000 | 5,000 | |||||
2020 And Prior Car Wash Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Payment of contingent consideration related to acquisitions | 2,000 | ||||||||||||||
Series of Individually Immaterial Business Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | acquistion | 5 | ||||||||||||||
Series of Individually Immaterial Business Acquisitions | Car Wash | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | acquisition | 2 | ||||||||||||||
Cash used in business acquisitions, net of cash acquired | 9,000 | ||||||||||||||
Series of Individually Immaterial Business Acquisitions | Maintenance | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | acquisition | 3 | ||||||||||||||
Cash used in business acquisitions, net of cash acquired | 2,000 | ||||||||||||||
ICWG Acquisition | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | wash_center | 940 | ||||||||||||||
Number of countries across Europe in which entity operates | country | 14 | ||||||||||||||
Reduction of goodwill | $ (781,072) | 1,000 | $ 1,000 | 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | ||||||
Fix Auto | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Cash used in business acquisitions, net of cash acquired | $ 28,517 | ||||||||||||||
Reduction of goodwill | $ (19,390) | ||||||||||||||
Percentage of outstanding equity acquired | 100.00% | ||||||||||||||
Cash acquired from acquisition | $ 2,000 | ||||||||||||||
Number of franchised locations acquired | franchise_location | 150 | ||||||||||||||
Number of company-operated locations acquired | franchise_location | 10 | ||||||||||||||
Fair value of contingent consideration | $ 2,943 | 4,000 | |||||||||||||
Benefit to acquisition costs | $ 4,000 | $ 4,000 | |||||||||||||
2020 Cash Wash Acquisitions | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of businesses acquired | car_wash_site | 17 | ||||||||||||||
Cash used in business acquisitions, net of cash acquired | $ 109,000 | ||||||||||||||
Reduction of goodwill | $ (30,651) | $ (30,651) |
Acquisitions and Dispositions_2
Acquisitions and Dispositions - Schedule of Estimated Purchase Price Allocation (Details) $ in Thousands | Jan. 14, 2021 | Aug. 03, 2020USD ($)shares | Sep. 25, 2021USD ($) | Dec. 26, 2020USD ($) | Apr. 20, 2020USD ($) |
Liabilities: | |||||
Goodwill | $ 1,810,085 | $ 1,727,351 | |||
Stock split | 88,990 | ||||
2021 Car Wash Acquisitions | |||||
Assets: | |||||
Cash | 161 | ||||
Right of use assets | 2,487 | ||||
Land and improvements | 46,495 | ||||
Building | 232,375 | ||||
Equipment | 46,063 | ||||
Inventory | 311 | ||||
Intangibles, net | 550 | ||||
Deferred tax assets | 212 | ||||
Assets held for sale | 996 | ||||
Assets acquired | 329,650 | ||||
Liabilities: | |||||
Accrued liability | 356 | ||||
Lease liability | 2,587 | ||||
Deferred tax liabilities | 812 | ||||
Liabilities assumed | 3,755 | ||||
Net assets acquired | 325,895 | ||||
Total consideration | 427,236 | ||||
Goodwill | 101,341 | ||||
2021 Maintenance Acquisitions | |||||
Assets: | |||||
Land and improvements | 1,590 | ||||
Building | 3,390 | ||||
Equipment | 850 | ||||
Prepaid and other assets | 20 | ||||
Deferred tax assets | 28 | ||||
Assets acquired | 5,858 | ||||
Liabilities: | |||||
Liabilities assumed | 20 | ||||
Net assets acquired | 5,838 | ||||
Goodwill | 1,763 | ||||
2021 PC&G Acquisitions | |||||
Assets: | |||||
Right of use assets | 1,067 | ||||
Equipment | 75 | ||||
Intangibles, net | 1,804 | ||||
Deferred tax assets | 23 | ||||
Assets acquired | 2,969 | ||||
Liabilities: | |||||
Accrued liability | 5 | ||||
Lease liability | 1,089 | ||||
Liabilities assumed | 1,094 | ||||
Net assets acquired | 1,875 | ||||
Total consideration | 1,969 | ||||
Goodwill | 94 | ||||
ICWG Acquisition | |||||
Assets: | |||||
Cash | $ 37,011 | ||||
Accounts and notes receivable | 2,591 | ||||
Right of use assets | 479,787 | ||||
Inventory | 12,761 | ||||
Intangibles, net | 165,730 | ||||
Fixed assets | 692,486 | ||||
Definite-lived intangibles | 5,972 | ||||
Other assets | 7,476 | ||||
Assets acquired | 1,403,814 | ||||
Liabilities: | |||||
Lease liability | 476,216 | ||||
Deferred tax liabilities | 134,130 | ||||
Accounts payable | 13,435 | ||||
Long-term debt | 656,684 | ||||
Derivative liabilities | 12,714 | ||||
Other liabilities | 82,307 | ||||
Liabilities assumed | 1,375,486 | ||||
Net assets acquired | 28,328 | ||||
Non-controlling interest acquired | 400 | ||||
Total consideration | $ 809,000 | ||||
Number of shares received (in shares) | shares | 39,169,857 | ||||
Goodwill | $ 781,072 | $ (1,000) | |||
Fix Auto | |||||
Assets: | |||||
Cash | $ 2,020 | ||||
Accounts and notes receivable | 2,317 | ||||
Right of use assets | 7,520 | ||||
Property and equipment | 1,023 | ||||
Inventory | 414 | ||||
Prepaid and other assets | 293 | ||||
Definite-lived intangibles | 15,200 | ||||
Assets acquired | 28,787 | ||||
Liabilities: | |||||
Accrued liability | 2,919 | ||||
Lease liability | 7,520 | ||||
Deferred tax liabilities | 3,770 | ||||
Accounts payable | 1,835 | ||||
Income taxes payable | 673 | ||||
Liabilities assumed | 16,717 | ||||
Net assets acquired | 12,070 | ||||
Total consideration | 31,460 | ||||
Goodwill | $ 19,390 | ||||
2020 Cash Wash Acquisitions | |||||
Assets: | |||||
Cash | 41 | ||||
Land and improvements | 18,635 | ||||
Building | 42,570 | ||||
Equipment | 12,125 | ||||
Deferred tax assets | 5,117 | ||||
Assets acquired | 78,488 | ||||
Liabilities: | |||||
Deferred revenue | 368 | ||||
Liabilities assumed | 368 | ||||
Net assets acquired | 78,120 | ||||
Total consideration | 108,771 | ||||
Goodwill | $ 30,651 |
Acquisitions and Dispositions_3
Acquisitions and Dispositions - Summary of Total Consideration (Details) - USD ($) $ in Thousands | Apr. 20, 2020 | Sep. 25, 2021 | Sep. 26, 2020 | Dec. 26, 2020 |
Business Acquisition [Line Items] | ||||
Cash used in business acquisitions, net of cash acquired | $ 442,488 | $ (8,575) | ||
Fix Auto | ||||
Business Acquisition [Line Items] | ||||
Cash used in business acquisitions, net of cash acquired | $ 28,517 | |||
Fair value of contingent consideration | 2,943 | $ 4,000 | ||
Total consideration | $ 31,460 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 25, 2021 | Sep. 26, 2020 | Sep. 25, 2021 | Sep. 26, 2020 | Dec. 26, 2020 | |
Revenue from Contract with Customer [Abstract] | |||||
Capitalized costs to obtain a contract | $ 10 | $ 10 | $ 9 | ||
Contract liabilities | 25 | 25 | $ 21 | ||
Revenue recognized (less than for all periods other than the nine months ended September 25, 2021) | $ 1 | $ 1 | $ 2 | $ 1 |
Segment Information - Schedule
Segment Information - Schedule of Segment Results (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2021 | Sep. 26, 2020 | Sep. 25, 2021 | Sep. 26, 2020 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 371,148 | $ 267,762 | $ 1,075,395 | $ 615,692 |
Segment Adjusted EBITDA | 98,628 | 69,084 | 278,094 | 141,455 |
Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 38,953 | 36,520 | 107,240 | 94,214 |
Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 213,755 | 140,788 | 603,808 | 323,339 |
Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 47,941 | 30,595 | 160,483 | 30,595 |
Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 19,762 | 14,927 | 56,665 | 42,429 |
Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 50,737 | 44,932 | 147,199 | 125,115 |
Operating Segments | Maintenance | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 144,457 | 114,636 | 417,617 | 305,847 |
Segment Adjusted EBITDA | 47,894 | 34,774 | 132,895 | 82,579 |
Operating Segments | Maintenance | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 9,635 | 6,971 | 26,651 | 21,028 |
Operating Segments | Maintenance | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 125,561 | 101,023 | 365,735 | 268,267 |
Operating Segments | Maintenance | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Maintenance | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Maintenance | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 9,261 | 6,642 | 25,231 | 16,552 |
Operating Segments | Car Wash | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 123,562 | 59,185 | 362,141 | 59,185 |
Segment Adjusted EBITDA | 37,999 | 17,739 | 115,223 | 17,739 |
Operating Segments | Car Wash | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Car Wash | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 74,105 | 28,586 | 196,858 | 28,586 |
Operating Segments | Car Wash | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 47,941 | 30,595 | 160,483 | 30,595 |
Operating Segments | Car Wash | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Car Wash | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 1,516 | 4 | 4,800 | 4 |
Operating Segments | Paint, Collision & Glass | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 50,575 | 47,072 | 145,041 | 121,120 |
Segment Adjusted EBITDA | 22,039 | 23,231 | 61,534 | 50,119 |
Operating Segments | Paint, Collision & Glass | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 20,280 | 19,235 | 57,578 | 52,220 |
Operating Segments | Paint, Collision & Glass | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 12,723 | 9,556 | 37,672 | 21,613 |
Operating Segments | Paint, Collision & Glass | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Paint, Collision & Glass | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Paint, Collision & Glass | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 17,572 | 18,281 | 49,791 | 47,287 |
Operating Segments | Platform Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 42,061 | 39,655 | 121,498 | 106,581 |
Segment Adjusted EBITDA | 16,254 | 13,306 | 44,864 | 36,740 |
Operating Segments | Platform Services | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 9,038 | 10,599 | 23,011 | 21,377 |
Operating Segments | Platform Services | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 1,465 | 1,686 | 3,911 | 5,020 |
Operating Segments | Platform Services | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Platform Services | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Operating Segments | Platform Services | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 31,558 | 27,370 | 94,576 | 80,184 |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 10,493 | 7,214 | 29,098 | 22,959 |
Segment Adjusted EBITDA | (25,558) | (19,966) | (76,422) | (45,722) |
Corporate and Other | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | (285) | 0 | (411) |
Corporate and Other | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (99) | (63) | (368) | (147) |
Corporate and Other | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Corporate and Other | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 19,762 | 14,927 | 56,665 | 42,429 |
Corporate and Other | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ (9,170) | $ (7,365) | $ (27,199) | $ (18,912) |
Segment Information - Reconcili
Segment Information - Reconciliation of Segment Adjusted EBITDA to Income Before Taxes (Details) - USD ($) $ in Thousands | Jan. 14, 2021 | Sep. 25, 2021 | Sep. 26, 2020 | Sep. 25, 2021 | Sep. 26, 2020 |
Segment Reporting Information [Line Items] | |||||
Income before taxes | $ 44,966 | $ 9,999 | $ 72,766 | $ 9,364 | |
Depreciation and amortization | 28,447 | 16,221 | 78,722 | 32,656 | |
Interest expense, net | 17,688 | 29,594 | 52,390 | 64,973 | |
Acquisition costs | 636 | 12,076 | 2,674 | 13,287 | |
Store opening costs | 666 | 119 | 1,360 | 1,921 | |
Equity-based compensation expense | 933 | 1,000 | 2,944 | 1,000 | |
Bad debt expense | 2,535 | 4,829 | |||
Loss on debt extinguishment | $ 46,000 | 0 | 673 | 45,576 | 673 |
Segment Adjusted EBITDA | 98,628 | 69,084 | 278,094 | 141,455 | |
Segment Reconciling Items | |||||
Segment Reporting Information [Line Items] | |||||
Acquisition costs | 636 | 12,076 | 2,674 | 13,287 | |
Non-core items and project costs, net | 1,357 | (2,690) | 3,910 | (926) | |
Store opening costs | 666 | 119 | 1,360 | 1,921 | |
Sponsor management fees | 0 | 4,278 | 0 | 5,357 | |
Straight-line rent adjustments | 2,548 | 485 | 8,391 | 3,124 | |
Equity-based compensation expense | (182) | 508 | |||
Foreign currency transaction loss, net | 1,074 | (2,230) | 6,356 | 55 | |
Bad debt expense | 0 | 0 | 0 | 2,842 | |
Asset impairment and closed store expenses | 313 | 741 | 3,005 | 7,621 | |
Loss on debt extinguishment | $ 0 | $ 673 | $ 45,576 | $ 673 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Sep. 25, 2021 | Dec. 26, 2020 |
Debt Instrument [Line Items] | ||
Total debt | $ 1,727,985 | $ 2,205,747 |
Less: unamortized discount | 0 | (46,030) |
Less: unamortized debt issuance costs | (32,306) | (34,510) |
Less: current portion of long-term debt | (18,342) | (22,988) |
Long-term debt, net | 1,677,337 | 2,102,219 |
Senior notes | Series 2018-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 265,375 | 267,438 |
Senior notes | Series 2019-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 291,750 | 294,000 |
Senior notes | Series 2019-2 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 269,500 | 271,563 |
Senior notes | Series 2020-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 172,812 | 174,125 |
Senior notes | Series 2020-2 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 446,625 | 450,000 |
Term loan | Car Wash First Lien Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt | 0 | 528,858 |
Term loan | Car Wash Second Lien Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt | 0 | 175,000 |
Revolving credit facility | Car Wash Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Total debt | 0 | 18,000 |
Revolving credit facility | Driven Holdings Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Total debt | 247,000 | 0 |
Other debt | ||
Debt Instrument [Line Items] | ||
Total debt | $ 34,923 | $ 26,763 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) $ in Thousands | Jan. 14, 2021USD ($) | May 31, 2021USD ($) | Dec. 31, 2019USD ($)extension_option | Sep. 25, 2021USD ($) | Sep. 26, 2020USD ($) | Sep. 25, 2021USD ($) | Sep. 26, 2020USD ($) |
Debt Instrument [Line Items] | |||||||
Repayment of debt | $ 725,000 | $ 725,000 | |||||
Loss on debt extinguishment | $ 46,000 | $ 0 | $ 673 | 45,576 | $ 673 | ||
Revolving Credit Facility | Series 2019-3 Variable Funding Senior Notes, Class A-1 | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | $ 115,000 | ||||||
Number of extension options | extension_option | 3 | ||||||
Extension period | 1 year | ||||||
Outstanding debt | 0 | 0 | |||||
Outstanding letters of credit | 15,000 | 15,000 | |||||
Remaining borrowing availability | 100,000 | 100,000 | |||||
Revolving Credit Facility | Driven Holdings Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | $ 300,000 | ||||||
Outstanding debt | $ 247,000 | $ 247,000 | |||||
Revolving credit facility | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | Driven Holdings Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Margin rate | 1.50% | ||||||
Maximum margin rate | 1.75% |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Sep. 25, 2021 | Dec. 26, 2020 |
Right-of-use assets | ||
Finance leases | $ 28,422 | $ 14,211 |
Operating leases | 905,527 | 884,927 |
Total right-of-use assets | 933,949 | 899,138 |
Current lease liabilities | ||
Finance leases | 2,897 | 2,149 |
Operating leases | 61,506 | 60,095 |
Total current lease liabilities | 64,403 | 62,244 |
Long-term lease liabilities | ||
Finance leases | 24,413 | 16,726 |
Operating leases | 843,925 | 818,001 |
Total long-term lease liabilities | $ 868,338 | $ 834,727 |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost and Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2021 | Sep. 26, 2020 | Sep. 25, 2021 | Sep. 26, 2020 | |
Finance lease expense: | ||||
Amortization of right-of-use assets | $ 715 | $ 280 | $ 1,970 | $ 565 |
Interest on lease liabilities | 299 | 163 | 796 | 375 |
Operating lease expense | 29,028 | 20,874 | 85,564 | 46,180 |
Short-term lease expense | 523 | 685 | 1,619 | 818 |
Variable lease expense | 206 | 203 | 692 | 492 |
Total lease expense | $ 30,771 | $ 22,205 | 90,641 | 48,430 |
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows used in operating leases | 79,310 | 40,898 | ||
Operating cash flows used in finance leases | 736 | 360 | ||
Financing cash flows used in finance leases | 921 | 197 | ||
Right-of-use assets obtained in exchange for lease obligations: | ||||
Operating leases | 75,268 | 855,308 | ||
Finance leases | $ 7,249 | $ 12,808 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Sep. 25, 2021USD ($) | Sep. 26, 2020USD ($) | Sep. 25, 2021USD ($) | Sep. 26, 2020USD ($) | Sep. 25, 2021USD ($) | Sep. 25, 2021wash_center | Sep. 25, 2021maintenance_site | Sep. 25, 2021 | Dec. 26, 2020USD ($) | |
Lessee, Lease, Description [Line Items] | |||||||||
Sublease revenue | $ 2,000 | $ 2,000 | $ 5,000 | $ 5,000 | |||||
Number cash wash properties sold | 19 | 3 | |||||||
Net gain on sale | $ 1,000 | ||||||||
Operating lease right-of-use assets | $ 905,527 | $ 884,927 | |||||||
Finance lease, weighted average remaining lease term | 11 years 6 months | 11 years 6 months | |||||||
Operating lease, weighted average remaining lease term | 14 years 9 months 18 days | 14 years 9 months 18 days | |||||||
Finance lease, weighted average discount rate, percent | 5.33% | ||||||||
Operating lease, weighted average discount rate, percent | 4.82% | ||||||||
March 2021 Operating Lease Agreements | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Renewal term | 20 years | 20 years | |||||||
Operating lease right-of-use assets | 62,000 | ||||||||
Operating lease liability | $ 59,000 | ||||||||
Minimum | March 2021 Operating Lease Agreements | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Lease term | 15 years | 15 years | |||||||
Maximum | March 2021 Operating Lease Agreements | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Lease term | 20 years | 20 years |
Share-based Compensation (Detai
Share-based Compensation (Details) $ in Thousands | Jan. 06, 2021USD ($)shares | Sep. 25, 2021USD ($)intallmentshares | Sep. 26, 2020USD ($) | Sep. 25, 2021USD ($)intallmentshares | Sep. 26, 2020USD ($) | Jan. 14, 2021shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Termination period | 6 months | |||||
Shares of common stock purchased (in shares) | 0 | |||||
Equity-based compensation expense (less than for prior periods) | $ | $ 933 | $ 1,000 | $ 2,944 | $ 1,000 | ||
Antidilutive securities (in shares) | 0 | 38,000 | ||||
Restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Antidilutive securities (in shares) | 0 | 2,000 | ||||
Stock options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Antidilutive securities (in shares) | 0 | 36,000 | ||||
Segment Reconciling Items | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation expense (less than for prior periods) | $ | $ (182) | $ 508 | ||||
2021 Omnibus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Maximum number of shares that may be issued (in shares) | 12,533,984 | |||||
Common stock reserved for additional grants (in shares) | 6,986,207 | 6,986,207 | ||||
2021 Omnibus Plan | Profits Interest Time Units | Driven Investor LLC | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of vesting installments | intallment | 5 | 5 | ||||
Award vesting rights percentage | 20.00% | |||||
Award vesting period | 5 years | |||||
2021 Omnibus Plan | Restricted stock award, performance-based | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair value of award as a result of modification | $ | $ 26,000 | $ 66,000 | ||||
Expected term | 4 years 11 months 15 days | |||||
Expected volatility rate | 40.60% | |||||
Risk-free interest rate | 0.48% | |||||
Unrecognized compensation expense | $ | $ 91,000 | $ 91,000 | ||||
2021 Omnibus Plan | Restricted stock award, time-based | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 3 years 25 days | |||||
Unrecognized compensation expense | $ | $ 6,000 | $ 6,000 | ||||
2021 Omnibus Plan | Restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of vesting installments | intallment | 3 | 3 | ||||
Award vesting rights percentage | 33.00% | |||||
Award vesting period | 3 years | |||||
Expected term | 2 years 5 months 26 days | |||||
Unrecognized compensation expense | $ | $ 1,000 | $ 1,000 | ||||
2021 Omnibus Plan | Performance stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Expected term | 2 years 11 months 15 days | |||||
Expected volatility rate | 41.16% | |||||
Risk-free interest rate | 0.23% | |||||
Unrecognized compensation expense | $ | $ 2,000 | $ 2,000 | ||||
2021 Omnibus Plan | Share-based Payment Arrangement, Employee | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Maximum number of shares that may be issued (in shares) | 5,582,522 | |||||
Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Maximum number of shares that may be issued (in shares) | 1,790,569 |
Earnings per share - Schedule o
Earnings per share - Schedule of Basic and Diluted Loss Per Share (Details) $ / shares in Units, $ in Thousands | Jan. 14, 2021 | Sep. 25, 2021USD ($)$ / sharesshares | Sep. 26, 2020USD ($)$ / sharesshares | Sep. 25, 2021USD ($)$ / sharesshares | Sep. 26, 2020USD ($)$ / sharesshares | |
Earnings Per Share [Abstract] | ||||||
Net income attributable to Driven Brands Holdings Inc. | $ 33,124 | $ 4,079 | $ 48,389 | $ 3,289 | ||
Basic earnings per share: | ||||||
Less: Net income attributable to participating securities, basic | 709 | 0 | 1,057 | 0 | ||
Net income after participating securities, basic | $ 32,415 | $ 4,079 | $ 47,332 | $ 3,289 | ||
Weighted-average common shares outstanding (in shares) | shares | [1] | 162,635,000 | 111,950,000 | 160,030,000 | 96,643,000 | |
Basic earnings per share (in dollars per share) | $ / shares | [1] | $ 0.20 | $ 0.04 | $ 0.30 | $ 0.03 | |
Diluted earnings per share: | ||||||
Less: Net income attributable to participating securities, diluted | $ 632 | $ 0 | $ 942 | $ 0 | ||
Net income after participating securities, diluted | $ 32,492 | $ 4,079 | $ 47,447 | $ 3,289 | ||
Dilutive effect of share-based awards | shares | 3,995,000 | 0 | 3,938,000 | 0 | ||
Weighted-average common shares outstanding, as adjusted (in shares) | shares | [1] | 166,630,000 | 111,950,000 | 163,968,000 | 96,643,000 | |
Diluted earnings per share (in dollars per share) | $ / shares | [1] | $ 0.19 | $ 0.04 | $ 0.29 | $ 0.03 | |
Stock split | 88,990 | |||||
[1] | Shares and earnings (loss) per share for 2020 have been adjusted to reflect an implied 88,990-for-one stock split that became effective on January 14, 2021. See Note 1 for additional information. |
Earnings per share - Narrative
Earnings per share - Narrative (Details) - shares | 3 Months Ended | 9 Months Ended |
Sep. 25, 2021 | Sep. 25, 2021 | |
Earnings Per Share [Abstract] | ||
Performance awards contingent on performance conditions which have not been met yet (in shares) | 4,618,722 | 4,618,722 |
Earnings per share - Schedule_2
Earnings per share - Schedule of Antidilutive Shares (Details) - shares | 3 Months Ended | 9 Months Ended |
Sep. 25, 2021 | Sep. 25, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 38,000 |
Restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 2,000 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 36,000 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Thousands | Nov. 09, 2021USD ($) | Sep. 30, 2021USD ($)franchise_location | Sep. 29, 2021USD ($) | Nov. 09, 2021USD ($)franchise_location | Sep. 25, 2021USD ($) | Sep. 26, 2020USD ($) |
Subsequent Event [Line Items] | ||||||
Cash used in business acquisitions, net of cash acquired | $ 442,488 | $ (8,575) | ||||
Subsequent Event | 2021-01 Senior Notes | Senior notes | ||||||
Subsequent Event [Line Items] | ||||||
Debt issued | $ 450,000 | |||||
Interest rate | 2.791% | |||||
Subsequent Event | Revolving Credit Facility | Driven Holdings Revolving Credit Facility | ||||||
Subsequent Event [Line Items] | ||||||
Repayment of debt | $ 247,000 | |||||
Draw down on debt | $ 10,000 | |||||
CarStar | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Number of businesses acquired | franchise_location | 10 | |||||
Cash used in business acquisitions, net of cash acquired | $ 31,000 | |||||
Magic Tunnel Car Wash | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Number of businesses acquired | franchise_location | 20 | |||||
Cash used in business acquisitions, net of cash acquired | $ 123,000 |
Uncategorized Items - drvn-2021
Label | Element | Value |
Accounting Standards Update 2016-02 [Member] | ||
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2016-02 [Member] |
Accounting Standards Update 2016-13 [Member] | ||
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2016-13 [Member] |