Cover Page
Cover Page - shares | 6 Months Ended | |
Jul. 01, 2023 | Aug. 04, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jul. 01, 2023 | |
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, $0.01 par value | |
Trading Symbol | DRVN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 167,532,382 | |
Entity Central Index Key | 0001804745 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-30 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Revenue: | ||||
Revenue | $ 606,851 | $ 508,624 | $ 1,169,318 | $ 976,947 |
Operating Expenses: | ||||
Selling, general, and administrative expenses | 96,815 | 97,977 | 209,143 | 190,197 |
Acquisition related costs | 3,750 | 3,338 | 5,597 | 7,656 |
Store opening costs | 1,377 | 666 | 2,402 | 1,172 |
Depreciation and amortization | 45,419 | 38,087 | 83,617 | 71,110 |
Trade name impairment | 0 | 125,450 | 0 | 125,450 |
Asset impairment charges and lease terminations | 6,044 | (882) | 6,211 | 16 |
Total operating expenses | 509,258 | 544,309 | 994,539 | 938,912 |
Operating income (loss) | 97,593 | (35,685) | 174,779 | 38,035 |
Other expenses, net: | ||||
Interest expense, net | 40,871 | 26,270 | 79,012 | 51,623 |
(Gain) loss on foreign currency transactions | (1,302) | 13,937 | (2,977) | 14,908 |
Other expense, net | 39,569 | 40,207 | 76,035 | 66,531 |
Income (loss) before taxes | 58,024 | (75,892) | 98,744 | (28,496) |
Income tax expense (benefit) | 20,275 | (18,848) | 31,246 | (5,880) |
Net income (loss) | 37,749 | (57,044) | 67,498 | (22,616) |
Net loss attributable to non-controlling interest | 0 | 0 | 0 | (15) |
Net income (loss) attributable to Driven Brands Holdings Inc. | $ 37,749 | $ (57,044) | $ 67,498 | $ (22,601) |
Earnings (loss) per share: | ||||
Basic (in dollars per share) | $ 0.23 | $ (0.34) | $ 0.41 | $ (0.14) |
Diluted (in dollars per share) | $ 0.22 | $ (0.34) | $ 0.40 | $ (0.14) |
Weighted average shares outstanding | ||||
Basic (in shares) | 162,911 | 162,781 | 162,848 | 162,772 |
Diluted (in shares) | 166,888 | 162,781 | 166,882 | 162,772 |
Franchise royalties and fees | ||||
Revenue: | ||||
Revenue | $ 49,805 | $ 44,850 | $ 93,320 | $ 82,738 |
Company-operated store sales | ||||
Revenue: | ||||
Revenue | 394,578 | 323,885 | 770,644 | 616,276 |
Operating Expenses: | ||||
Operating expenses | 257,040 | 192,939 | 500,449 | 370,806 |
Independently-operated store sales | ||||
Revenue: | ||||
Revenue | 61,533 | 54,942 | 114,065 | 118,031 |
Operating Expenses: | ||||
Operating expenses | 31,958 | 28,843 | 61,322 | 62,142 |
Advertising contributions | ||||
Revenue: | ||||
Revenue | 24,749 | 22,091 | 46,426 | 41,789 |
Operating Expenses: | ||||
Operating expenses | 24,749 | 22,091 | 46,426 | 41,789 |
Supply and other revenue | ||||
Revenue: | ||||
Revenue | 76,186 | 62,856 | 144,863 | 118,113 |
Operating Expenses: | ||||
Operating expenses | $ 42,106 | $ 35,800 | $ 79,372 | $ 68,574 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 37,749 | $ (57,044) | $ 67,498 | $ (22,616) |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | 6,165 | (42,114) | 17,516 | (47,688) |
Unrealized (loss) gain from cash flow hedges, net of tax benefit of ($19), ($26), ($21), and ($26), respectively | 222 | (225) | 22 | (93) |
Actuarial (loss) gain of defined (benefit) expense pension plan, net of tax expense of $0, | (4) | 7 | 12 | 7 |
Other comprehensive income (loss), net | 6,383 | (42,332) | 17,550 | (47,774) |
Total comprehensive income (loss) | 44,132 | (99,376) | 85,048 | (70,390) |
Comprehensive income (loss) attributable to non-controlling interests | 14 | (19) | 13 | (21) |
Comprehensive income (loss) attributable to Driven Brands Holdings Inc. | $ 44,118 | $ (99,357) | $ 85,035 | $ (70,369) |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jul. 01, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 212,123 | $ 227,110 |
Restricted cash | 657 | 792 |
Accounts and notes receivable, net | 200,377 | 179,888 |
Inventory | 83,036 | 72,040 |
Prepaid and other assets | 52,353 | 40,084 |
Income tax receivable | 14,344 | 15,075 |
Advertising fund assets, restricted | 51,210 | 36,421 |
Total current assets | 614,100 | 571,410 |
Other assets | 36,923 | 30,561 |
Property and equipment, net | 1,677,804 | 1,545,738 |
Operating lease right-of-use assets | 1,449,708 | 1,299,189 |
Deferred commissions | 6,400 | 7,121 |
Intangibles, net | 755,990 | 765,903 |
Goodwill | 2,299,953 | 2,277,065 |
Deferred tax assets | 3,030 | 2,911 |
Total assets | 6,843,908 | 6,499,898 |
Current liabilities: | ||
Accounts payable | 81,751 | 60,606 |
Accrued expenses and other liabilities | 311,352 | 317,318 |
Income tax payable | 3,145 | 4,454 |
Current portion of long-term debt | 32,044 | 32,986 |
Income tax receivable liability | 53,781 | 53,328 |
Advertising fund liabilities | 36,910 | 36,726 |
Total current liabilities | 518,983 | 505,418 |
Long-term debt | 2,779,511 | 2,705,281 |
Deferred tax liabilities | 297,884 | 276,749 |
Operating lease liabilities | 1,320,670 | 1,177,501 |
Income tax receivable liability | 117,915 | 117,915 |
Deferred revenue | 30,155 | 30,046 |
Long-term accrued expenses and other liabilities | 31,132 | 33,419 |
Total liabilities | 5,096,250 | 4,846,329 |
Preferred Stock $0.01 par value; 100,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Common stock, $0.01 par value, 900,000,000 shares authorized: and 167,366,561 and 167,404,047 shares outstanding; respectively | 1,674 | 1,674 |
Additional paid-in capital | 1,637,945 | 1,628,904 |
Retained earnings | 152,293 | 84,795 |
Accumulated other comprehensive loss | (44,898) | (62,435) |
Total shareholders’ equity attributable to Driven Brands Holdings Inc. | 1,747,014 | 1,652,938 |
Non-controlling interests | 644 | 631 |
Total shareholders' equity | 1,747,658 | 1,653,569 |
Total liabilities and shareholders' equity | $ 6,843,908 | $ 6,499,898 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Jul. 01, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 900,000,000 | 900,000,000 |
Common stock, shares outstanding (in shares) | 167,366,561 | 167,404,047 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’/MEMBERS’ EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss) | Non-controlling interests |
Beginning balance (in shares) at Dec. 25, 2021 | 167,380,450 | |||||
Beginning balance at Dec. 25, 2021 | $ 1,674 | $ 1,605,890 | $ 41,607 | $ (5,028) | $ 1,099 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock issued relating to Employee Stock Purchase Plan (in shares) | 111,924 | |||||
Stock issued relating to Employee Stock Purchase Plan | $ 1 | |||||
Shares issued for exercise/vesting of share-based compensation awards (in shares) | 20,200 | |||||
Forfeiture of restricted stock awards (in shares) | (68,466) | |||||
Forfeiture of restricted stock awards | $ (1) | |||||
Equity-based compensation expense | 6,851 | |||||
Exercise of stock options | 2,200 | |||||
Tax withholding equity-based transactions | (14) | |||||
Net income (loss) | $ (22,616) | (22,601) | (15) | |||
Other comprehensive income (loss) | (47,774) | (47,768) | (6) | |||
Divestiture of Denmark car wash operations | (432) | |||||
Ending balance (in shares) at Jun. 25, 2022 | 167,444,108 | |||||
Ending balance at Jun. 25, 2022 | 1,583,457 | $ 1,674 | 1,614,927 | 19,006 | (52,796) | 646 |
Beginning balance (in shares) at Mar. 26, 2022 | 167,506,829 | |||||
Beginning balance at Mar. 26, 2022 | $ 1,675 | 1,610,585 | 76,050 | (10,483) | 665 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Shares issued for exercise/vesting of share-based compensation awards (in shares) | 5,745 | |||||
Forfeiture of restricted stock awards (in shares) | (68,466) | |||||
Forfeiture of restricted stock awards | $ (1) | |||||
Equity-based compensation expense | 4,233 | |||||
Exercise of stock options | 109 | |||||
Net income (loss) | (57,044) | (57,044) | ||||
Other comprehensive income (loss) | (42,332) | (42,313) | (19) | |||
Ending balance (in shares) at Jun. 25, 2022 | 167,444,108 | |||||
Ending balance at Jun. 25, 2022 | $ 1,583,457 | $ 1,674 | 1,614,927 | 19,006 | (52,796) | 646 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Preferred stock (in shares) | 0 | |||||
Preferred stock | $ 0 | |||||
Preferred stock (in shares) | 0 | |||||
Beginning balance (in shares) at Dec. 31, 2022 | 167,404,047 | 167,404,047 | ||||
Beginning balance at Dec. 31, 2022 | $ 1,653,569 | $ 1,674 | 1,628,904 | 84,795 | (62,435) | 631 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock issued relating to Employee Stock Purchase Plan (in shares) | 26,358 | |||||
Stock issued relating to Employee Stock Purchase Plan | 612 | |||||
Shares issued for exercise/vesting of share-based compensation awards (in shares) | 178,303 | |||||
Shares issued for exercise/vesting of share-based compensation awards | $ 2 | |||||
Forfeiture of restricted stock awards (in shares) | (242,147) | |||||
Forfeiture of restricted stock awards | $ (2) | |||||
Equity-based compensation expense | 7,049 | |||||
Exercise of stock options | 1,500 | |||||
Tax withholding equity-based transactions | (120) | |||||
Net income (loss) | 67,498 | 67,498 | ||||
Other comprehensive income (loss) | $ 17,550 | 17,537 | 13 | |||
Ending balance (in shares) at Jul. 01, 2023 | 167,366,561 | 167,366,561 | ||||
Ending balance at Jul. 01, 2023 | $ 1,747,658 | $ 1,674 | 1,637,945 | 152,293 | (44,898) | 644 |
Beginning balance (in shares) at Apr. 01, 2023 | 167,560,449 | |||||
Beginning balance at Apr. 01, 2023 | $ 1,675 | 1,633,460 | 114,544 | (51,267) | 630 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Shares issued for exercise/vesting of share-based compensation awards (in shares) | 48,259 | |||||
Shares issued for exercise/vesting of share-based compensation awards | $ 1 | |||||
Forfeiture of restricted stock awards (in shares) | (242,147) | |||||
Forfeiture of restricted stock awards | $ (2) | |||||
Equity-based compensation expense | 4,485 | |||||
Net income (loss) | 37,749 | 37,749 | ||||
Other comprehensive income (loss) | $ 6,383 | 6,369 | 14 | |||
Ending balance (in shares) at Jul. 01, 2023 | 167,366,561 | 167,366,561 | ||||
Ending balance at Jul. 01, 2023 | $ 1,747,658 | $ 1,674 | $ 1,637,945 | $ 152,293 | $ (44,898) | $ 644 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Preferred stock (in shares) | 0 | |||||
Preferred stock | $ 0 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’/MEMBERS’ EQUITY (Parenthetical) (Unaudited) - $ / shares | Jul. 01, 2023 | Dec. 31, 2022 | Jun. 25, 2022 |
Statement of Stockholders' Equity [Abstract] | |||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jul. 01, 2023 | Jun. 25, 2022 | |
Statement of Cash Flows [Abstract] | ||
Net income (loss) | $ 67,498 | $ (22,616) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 83,617 | 71,110 |
Trade name impairment | 0 | 125,450 |
Equity-based compensation expense | 7,049 | 6,851 |
(Gain) loss on foreign denominated transactions | (1,723) | 14,908 |
Gain on foreign currency derivatives | (1,254) | 0 |
Gain on sale of businesses, fixed assets, and sale-leaseback transactions | (12,230) | (9,059) |
Reclassification of interest rate hedge to income | (1,039) | 0 |
Bad debt expense | 602 | 936 |
Asset impairment costs | 6,211 | 16 |
Amortization of deferred financing costs and bond discounts | 4,343 | 4,565 |
Provision (benefit) for deferred income taxes | 18,812 | (31,908) |
Other, net | 9,641 | 9,681 |
Changes in assets and liabilities, net of acquisitions: | ||
Accounts and notes receivable, net | (30,373) | (59,579) |
Inventory | (11,108) | (6,899) |
Prepaid and other assets | (7,894) | (19,082) |
Advertising fund assets and liabilities, restricted | (8,768) | (1,321) |
Other Assets | (25,456) | (1,882) |
Deferred commissions | 330 | (178) |
Deferred revenue | 1,585 | 497 |
Accounts payable | 16,231 | 20,209 |
Accrued expenses and other liabilities | (1,171) | (45,950) |
Income tax receivable | (320) | 19,640 |
Cash provided by operating activities | 114,583 | 75,389 |
Cash flows from investing activities: | ||
Capital expenditures | (320,071) | (148,763) |
Cash used in business acquisitions, net of cash acquired | (44,868) | (394,388) |
Proceeds from sale-leaseback transactions | 143,622 | 56,083 |
Proceeds from sale or disposal of businesses and fixed assets | 217 | 2,183 |
Cash used in investing activities | (221,100) | (484,885) |
Cash flows from financing activities: | ||
Repayment of long-term debt | (13,961) | (9,682) |
Proceeds from revolving lines of credit and short-term debt | 230,000 | 105,000 |
Repayments of revolving lines of credit and short-term debt | (120,000) | 0 |
Repayment of principal portion of finance lease liability | (1,889) | (1,156) |
Purchase of equity securities | (716) | 0 |
Stock option exercises | 1,758 | 188 |
Other, net | (64) | (36) |
Cash provided by financing activities | 95,128 | 94,314 |
Effect of exchange rate changes on cash | 2,087 | (4,454) |
Net change in cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted | (9,302) | (319,636) |
Cash and cash equivalents, beginning of period | 227,110 | 523,414 |
Cash included in advertising fund assets, restricted, beginning of period | 32,871 | 38,586 |
Restricted cash, beginning of period | 792 | 792 |
Cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted, beginning of period | 260,773 | 562,792 |
Cash and cash equivalents, end of period | 212,123 | 197,853 |
Cash included in advertising fund assets, restricted, end of period | 38,691 | 44,511 |
Restricted cash, end of period | 657 | 792 |
Cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted, end of period | 251,471 | 243,156 |
Supplemental cash flow disclosures - non-cash items: | ||
Capital expenditures included in accrued expenses and other liabilities | 43,191 | 5,464 |
Deferred consideration included in accrued expenses and other liabilities | 16,129 | 14,227 |
Supplemental cash flow disclosures - cash paid for: | ||
Interest | 78,955 | 51,491 |
Income taxes | $ 13,614 | $ 5,457 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Unrealized (loss) gain from cash flow hedges, net of tax benefit | $ (19) | $ (26) | $ (21) | $ (26) |
Actuarial gain of defined benefit pension plan, tax expense | $ 0 | $ 0 | $ 0 | $ 0 |
Description of Business
Description of Business | 6 Months Ended |
Jul. 01, 2023 | |
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 4,900 franchised, independently-operated, and company-operated locations across 49 U.S. states and 13 other countries. The Company has a portfolio of highly recognized brands, including Take 5 Oil Change ® , Take 5 Car Wash ® , Meineke Car Care Centers ® , MAACO ® , CARSTAR ® , Auto Glass Now ® , and 1-800-Radiator & A/C ® that compete in the automotive services industry. Approximately 74% of the Company’s locations are franchised or independently-operated. 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 a 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 tax receivable agreement was effective as of the date of the Company’s IPO. The Company recorded a current tax receivable liability of $54 million and $53 million as of July 1, 2023 and December 31, 2022, respectively, and a non-current tax receivable liability of $118 million as of July 1, 2023 and December 31, 2022, on the consolidated balance sheets. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jul. 01, 2023 | |
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 six months ended July 1, 2023 and June 25, 2022, each consisted of 13 weeks and 26 weeks, respectively. The Car Wash segment 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, the unaudited interim financial data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results of operations, balance sheet, cash flows, and shareholders’/members’ equity for the interim periods presented. 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 unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the year ended December 31, 2022. Certain information and note disclosures normally included in the unaudited 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 six months ended July 1, 2023 may not be indicative of the results to be expected for any other interim period or the year ending December 30, 2023. Certain prior year amounts have been reclassified to conform to current year presentation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the unaudited consolidated financial statements and the related notes to the unaudited consolidated financial statements. Significant items that are subject to estimates and assumptions include, but are not limited to, valuation of intangible assets and goodwill; income taxes; allowances for credit losses; valuation of derivatives; self-insurance claims; and stock-based compensation. Management evaluates its estimates on an ongoing basis and may employ outside experts to assist in its evaluations. Changes in such estimates, based on historical experience, current conditions, and various other additional information, may affect amounts reported in future periods. Actual results could differ due to uncertainty inherent in the natures of these estimates. 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 has 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 July 1, 2023 and December 31, 2022 are summarized as follows: Items Measured at Fair Value at July 1, 2023 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 207 $ — $ 207 Derivative assets, recorded in other assets — 560 560 Derivative liabilities, recorded in accrued expenses and other liabilities — 494 494 Items Measured at Fair Value at December 31, 2022 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 758 $ — $ 758 Derivative assets, recorded in prepaid and other assets — 158 158 Derivative assets, recorded in other assets — 2,148 2,148 Derivative liabilities, recorded in accrued expenses and other liabilities — 5,005 5,005 The fair value of the Company’s foreign currency derivative instruments is derived from valuation models, which use Level 2 observable inputs such as quoted market prices, interest rates, and forward yield curves. The carrying value and estimated fair value of total long-term debt were as follows: July 1, 2023 December 31, 2022 (in thousands) Carrying value Estimated fair value Carrying value Estimated fair value Long-term debt $ 2,850,789 $ 2,592,533 $ 2,784,175 $ 2,477,456 Recently Issued Accounting Standards In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . This ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates and, particularly, the risk of cessation of LIBOR, regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. This guidance is effective immediately and the amendments may be applied prospectively through December 31, 2024. On June 2, 2023, the Company entered into a loan amendment to transition our |
Acquisitions and Dispositions
Acquisitions and Dispositions | 6 Months Ended |
Jul. 01, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Dispositions | Acquisitions and Dispositions The Company strategically acquires companies and assets in order to increase its footprint and offer products and services that diversify its existing offerings, primarily through asset purchase agreements. These acquisitions are accounted for as business combinations using the acquisition method, 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 with the remaining amount recorded in goodwill. 2023 Acquisitions The Company completed three acquisitions in the Maintenance segment during the six months ended July 1, 2023, representing three sites. The aggregate cash consideration for these acquisitions, net of cash acquired and liabilities assumed, was approximately $6 million. The Company completed two acquisitions in the Car Wash segment during the six months ended July 1, 2023, representing three sites. The aggregate cash consideration for these acquisitions, net of cash acquired and liabilities assumed, was approximately $15 million. The Company completed two acquisitions in the Paint, Collision & Glass segment during the six months ended July 1, 2023, representing two sites. The aggregate cash consideration for these acquisitions, net of cash acquired and liabilities assumed, was approximately $6 million. The Company estimated the fair value of acquired assets and liabilities as of the date of acquisition based on information currently available. As the Company finalizes the fair value of assets acquired and liabilities assumed, additional purchase price adjustments may be recorded during the measurement period. The provisional amounts for assets acquired and liabilities assumed for the 2023 acquisitions are as follows: Maintenance Segment (in thousands) Maintenance Assets: Operating lease right-of-use assets $ 658 Property and equipment, net 3,705 Goodwill 2,445 Assets acquired 6,808 Liabilities: Accrued Expenses and other liabilities 20 Operating lease liabilities 641 Total liabilities assumed 661 Cash consideration, net of cash acquired 5,862 Deferred consideration 285 Total consideration, net of cash acquired $ 6,147 Car Wash Segment (in thousands) Car Wash Assets: Property and equipment, net $ 11,052 Goodwill 3,948 Assets acquired 15,000 Total consideration, net of cash acquired $ 15,000 Paint, Collision & Glass Segment {in thousands) Paint, Collision & Glass Assets: Inventory $ 35 Property and equipment, net 667 Goodwill 4,940 Assets acquired 5,642 Cash consideration, net of cash acquired 4,947 Deferred consideration 695 Total consideration, net of cash acquired $ 5,642 Goodwill represents the excess of the consideration paid over the fair value of net assets acquired and includes the expected benefit of synergies within the existing segments and intangible assets that do not qualify for separate recognition. Goodwill, which was allocated to the Car Wash, Maintenance, and Paint, Collision & Glass segments, is substantially all deductible for income tax purposes. Deferred Consideration and Transaction Costs 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. Six Months Ended (in thousands) July 1, 2023 June 25, 2022 Deferred consideration at beginning of period $ 35,007 $ 16,000 Change in accrual 1,230 5,552 Payments (20,108) (7,325) Deferred consideration at end of period $ 16,129 $ 14,227 The Company incurred less than $1 million and approximately $1 million of transaction costs during the three months ended July 1, 2023 and June 25, 2022, respectively. The Company incurred less than $1 million and approximately $3 million of transaction costs during the six months ended July 1, 2023 and June 25, 2022, respectively. 2022 Disposition On March 16, 2022, the Company disposed of its 75% owned subsidiary, IMO Denmark ApS, for consideration of $2 million. As a result of the sale, a $1 million loss was recognized within selling, general, and administrative expenses during the three months ended June 25, 2022. Also, a noncontrolling interest of less than $1 million was derecognized. The Company allocated less than $1 million of goodwill as part of the sale. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 6 Months Ended |
Jul. 01, 2023 | |
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 July 1, 2023 and December 31, 2022 were $6 million and $7 million, respectively, and are presented within deferred commissions on the consolidated balance sheets. The Company recognized less than $1 million of costs during the three and six months ended July 1, 2023 and June 25, 2022 that were recorded as a contract asset at the beginning of the periods. |
Segment Information
Segment Information | 6 Months Ended |
Jul. 01, 2023 | |
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. 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, information technology, 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. Segment results for the three and six months ended July 1, 2023 and June 25, 2022 are as follows: Three months ended July 1, 2023 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 14,215 $ — $ 26,530 $ 9,060 $ — $ 49,805 Company-operated store sales 205,673 101,615 86,110 1,180 — 394,578 Independently-operated store sales — 61,533 — — — 61,533 Advertising fund contributions — — — — 24,749 24,749 Supply and other revenue 22,439 1,607 20,518 47,098 (15,476) 76,186 Total revenue $ 242,327 $ 164,755 $ 133,158 $ 57,338 $ 9,273 $ 606,851 Segment Adjusted EBITDA $ 85,753 $ 43,263 $ 41,249 $ 22,537 $ (40,417) $ 152,385 Three months ended June 25, 2022 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 11,326 $ — $ 23,605 $ 9,919 $ — $ 44,850 Company-operated store sales 168,648 101,796 52,049 1,392 — 323,885 Independently-operated store sales — 54,942 — — — 54,942 Advertising fund contributions — — — — 22,091 22,091 Supply and other revenue 14,331 1,841 19,715 41,891 (14,922) 62,856 Total revenue $ 194,305 $ 158,579 $ 95,369 $ 53,202 $ 7,169 $ 508,624 Segment Adjusted EBITDA $ 64,076 $ 53,677 $ 32,916 $ 20,541 $ (35,123) $ 136,087 Six months ended July 1, 2023 (in thousands) Maintenance Car Wash Paint, Platform Services Corporate Total Franchise royalties and fees $ 26,658 $ — $ 50,828 $ 15,834 $ — $ 93,320 Company-operated store sales 400,933 204,061 163,589 2,061 — 770,644 Independently-operated store sales — 114,065 — — — 114,065 Advertising fund contributions — — — — 46,426 46,426 Supply and other revenue 42,404 3,609 39,544 91,476 (32,170) 144,863 Total revenue $ 469,995 $ 321,735 $ 253,961 $ 109,371 $ 14,256 $ 1,169,318 Segment Adjusted EBITDA $ 158,739 $ 87,572 $ 76,961 $ 39,567 $ (81,601) $ 281,238 Six months ended June 25, 2022 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 20,961 $ — $ 44,970 $ 16,807 $ — $ 82,738 Company-operated store sales 325,476 196,291 91,965 2,544 — 616,276 Independently-operated store sales — 118,031 — — — 118,031 Advertising fund contributions — — — — 41,789 41,789 Supply and other revenue 26,610 3,532 37,795 77,017 (26,841) 118,113 Total revenue $ 373,047 $ 317,854 $ 174,730 $ 96,368 $ 14,948 $ 976,947 Segment Adjusted EBITDA $ 116,561 $ 109,397 $ 61,928 $ 34,706 $ (67,485) $ 255,107 The reconciliations of Income before taxes to Segment Adjusted EBITDA for the three and six months ended July 1, 2023 and June 25, 2022 are as follows: Three Months Ended Six Months Ended (in thousands) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Income (loss) before taxes $ 58,024 $ (75,892) $ 98,744 $ (28,496) Depreciation and amortization 45,419 38,087 83,617 71,110 Interest expense, net 40,871 26,270 79,012 51,623 Acquisition related costs (a) 3,750 3,338 5,597 7,656 Non-core items and project costs, net (b) 2,803 1,719 4,627 2,585 Store opening costs 1,377 666 2,402 1,172 Straight-line rent adjustment (c) 4,638 4,217 9,003 8,310 Equity-based compensation expense (d) 4,485 4,233 7,049 6,851 Foreign currency transaction (gain) / loss, net (e) (1,302) 13,937 (2,977) 14,908 Trade name impairment (f) — 125,450 — 125,450 Asset sale leaseback loss (gain), impairment and closed store expenses (g) (7,680) (5,938) (5,836) (6,062) Segment Adjusted EBITDA $ 152,385 $ 136,087 $ 281,238 $ 255,107 (a) Consists of acquisition costs as reflected within the unaudited 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 U.S. GAAP, such costs relating to acquisitions are expensed as incurred and not capitalized. (b) Consists of discrete items and project costs, including third party consulting and professional fees associated with strategic transformation initiatives as well as non-recurring payroll-related costs. (c) Consists of the non-cash portion of rent expense, which reflects the extent to which our straight-line rent expense recognized under U.S. GAAP exceeds or is less than our cash rent payments. (d) Represents non-cash equity-based compensation expense. (e) Represents foreign currency transaction (gains) losses, net that primarily related to the remeasurement of our intercompany loans, which are partially offset by unrealized gains and losses on remeasurement of cross currency swaps and forward contracts. (f) Relates to an impairment of certain Car Wash trade names as the Company elected to discontinue their use. (g) Relates to (gains) losses, net on sale leasebacks, impairment of certain fixed assets and operating lease right-of-use assets related to closed locations, and lease exit costs and other costs associated with stores that were closed prior to the respective lease termination dates. |
Other Intangible Assets
Other Intangible Assets | 6 Months Ended |
Jul. 01, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets | Other Intangible AssetsThe Company has acquired a number of car wash businesses since 2020. As part of those acquisitions, the Company determined a fair value for each of the associated intangible assets including trade names and customer relationships. During the quarter ended June 25 2022, the Company made the strategic decision to rebrand the majority of its U.S. car wash locations to operate under the name “Take 5 Car Wash”, and therefore discontinued the use of certain car wash trade names that were previously determined to have indefinite lives. Using a projected discounted cash flow analysis based on the relief from royalty method, the fair value of the trade names was determined to be $6 million while their carrying value was $131.5 million. As a result, the Company recognized a $125.5 million impairment charge, which is reported as trade name impairment charge in the unaudited consolidated statement of operations. The transition will take approximately two and a half years to complete from the date of impairment, and therefore the remaining carrying value is being amortized over 30 months. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jul. 01, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt The Company’s long-term debt obligations consist of the following: (in thousands) July 1, 2023 December 31, 2022 Series 2018-1 Securitization Senior Notes, Class A-2 $ 260,563 $ 261,938 Series 2019-1 Securitization Senior Notes, Class A-2 286,500 288,000 Series 2019-2 Securitization Senior Notes, Class A-2 264,688 266,063 Series 2020-1 Securitization Senior Notes, Class A-2 169,750 170,625 Series 2020-2 Securitization Senior Notes, Class A-2 438,750 441,000 Series 2021-1 Securitization Senior Notes, Class A-2 442,125 444,375 Series 2022-1 Securitization Senior Notes, Class A-2 362,263 364,088 Term Loan Facility 493,750 496,250 Revolving Credit Facility 110,000 — Other debt (a) 22,400 51,836 Total debt 2,850,789 2,784,175 Less: unamortized debt issuance costs (39,234) (45,908) Less: current portion of long-term debt (32,044) (32,986) Total long-term debt, net $ 2,779,511 $ 2,705,281 (a) Consists primarily of finance lease obligations. Series 2019-3 Variable Funding Securitization Senior Notes In December 2019, Driven Brands Funding, LLC (the “Issuer”) 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 in January 2050. The commitment under the 2019 VFN was set to expire in July 2022, with the option of three one-year extensions. In July 2023, the Company exercised the option to extend an additional year. The 2019 VFN are secured by substantially all assets of the Issuer and are guaranteed by the Securitization Entities. As of July 1, 2023, borrowings will incur interest at the Base Rate plus an applicable margin or Secured Overnight Financing Rate (“SOFR”) plus an applicable term adjustment. No amounts were outstanding under the 2019 VFN as of July 1, 2023 and no borrowings or repayments were made during the six months ended July 1, 2023. As of July 1, 2023, there were $25 million of outstanding letters of credit which reduced the borrowing availability under the 2019 VFN. Driven Holdings Revolving Credit Facility In May 2021, Driven Holdings, LLC, (“the Borrower”) a Delaware limited liability company and indirect wholly-owned subsidiary of Driven Brands Holdings Inc., entered into a credit agreement to secure a revolving line of credit with a group of financial institutions (“Revolving Credit Facility”), which provides for an aggregate amount of up to $300 million, and has a maturity date in May 2026 (“Credit Agreement”). On June 2, 2023, the Credit Agreement was amended pursuant to which as of July 1, 2023, borrowings will incur interest at the Base Rate plus an applicable margin or SOFR plus an applicable term adjustment. The Revolving Credit Facility also includes periodic commitment fees based on the available unused balance and a quarterly administrative fee. There was $110 million outstanding on the Revolving Credit Facility as of July 1, 2023 with $230 million of borrowings and $120 million of repayments made during the six months ended July 1, 2023. The Company’s debt agreements are subject to certain quantitative and qualitative covenants. As of July 1, 2023, the Company and its subsidiaries were in compliance with all covenants. |
Leases
Leases | 6 Months Ended |
Jul. 01, 2023 | |
Leases [Abstract] | |
Leases | LeasesDuring the six months ended July 1, 2023, the Company sold four maintenance and 33 car wash properties in various locations throughout the United States for a total of $144 million, resulting in a net gain of $25 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 initial terms of 18 to 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 $112 million and $112 million, respectively, related to these lease arrangements as of July 1, 2023. During the six months ended June 25, 2022, the Company sold six maintenance and ten car wash properties in various locations throughout the United States for a total of $55 million, resulting in a net gain of $7 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 initial terms of 15 years to 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 $47 million and $47 million, respectively, related to these lease arrangements as of June 25, 2022. Supplemental cash flow information related to the Company’s lease arrangements for the six months ended July 1, 2023 and June 25, 2022, respectively, was as follows: Six Months Ended (in thousands) July 1, 2023 June 25, 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 67,107 $ 57,330 Operating cash flows used in finance leases 810 785 Financing cash flows used in finance leases 953 829 |
Leases | LeasesDuring the six months ended July 1, 2023, the Company sold four maintenance and 33 car wash properties in various locations throughout the United States for a total of $144 million, resulting in a net gain of $25 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 initial terms of 18 to 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 $112 million and $112 million, respectively, related to these lease arrangements as of July 1, 2023. During the six months ended June 25, 2022, the Company sold six maintenance and ten car wash properties in various locations throughout the United States for a total of $55 million, resulting in a net gain of $7 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 initial terms of 15 years to 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 $47 million and $47 million, respectively, related to these lease arrangements as of June 25, 2022. Supplemental cash flow information related to the Company’s lease arrangements for the six months ended July 1, 2023 and June 25, 2022, respectively, was as follows: Six Months Ended (in thousands) July 1, 2023 June 25, 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 67,107 $ 57,330 Operating cash flows used in finance leases 810 785 Financing cash flows used in finance leases 953 829 |
Equity-based Compensation
Equity-based Compensation | 6 Months Ended |
Jul. 01, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Equity-based Compensation | Equity-based Compensation The Company granted new awards during the three months ended July 1, 2023, consisting of 68,119 restricted stock units (“RSUs”) and 72,092 performance stock units (“PSUs”). The Company granted new awards during the six months ended July 1, 2023 consisting of 380,736 RSUs and 647,359 PSUs. Awards are eligible to vest provided that the employee remains in continuous service on each vesting date. Generally, the RSUs vest ratably in three installments on each of the first three three-year performance period. The number of PSUs that vest is contingent on the Company achieving certain performance goals, one being a market condition and the other being a performance condition. The number of PSU shares that vest may range from zero to 200% of the original grant, based upon the level of performance. The awards are considered probable of meeting vesting requirements, and therefore, the Company has started recognizing expense. The fair value of the total RSUs, performance based PSUs and market based PSUs granted during the three months ended July 1, 2023 were $2 million, $1 million, and $1 million, respectively. The fair value of the total RSUs, performance based PSUs and market based PSUs granted during the six months ended July 1, 2023 were $11 million, $11 million and $9 million, respectively. The Company based the fair value of the RSUs and performance based PSUs on the Company’s stock price on the grant date. The range of assumptions used for issued PSUs with a market condition valued using the Monte Carlo model were as follows: Six months ended July 1, 2023 June 25, 2022 Annual dividend yield —% —% Expected term (years) 2.6 - 2.8 2.7 - 2.8 Risk-free interest rate 3.65% - 4.51% 2.32% - 2.76% Expected volatility 37.9% - 38.8% 40.9% - 43.9% Correlation to the index peer group 60.2% - 60.3% 50.7% - 59.5% The Company recorded $4 million and $7 million of share-based compensation expense during the three and six months ended July 1, 2023, respectively, and $4 million and $7 million during the three and six months ended June 25, 2022, respectively, within selling, general and administrative expenses on the unaudited consolidated statements of operations. |
Earnings (loss) per share
Earnings (loss) per share | 6 Months Ended |
Jul. 01, 2023 | |
Earnings Per Share [Abstract] | |
Earnings (loss) per share | Earnings (loss) per shareThe Company calculates basic and diluted earnings (loss)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 Six Months Ended (in thousands, except per share amounts) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Basic earnings (loss) per share: Net income (loss) attributable to Driven Brands Holdings Inc. $ 37,749 (57,044) $ 67,498 (22,601) Less: Net income (loss) attributable to participating securities, basic 794 (1,210) 1,420 (481) Net income (loss) after participating securities, basic 36,955 (55,834) 66,078 (22,120) Weighted-average common shares outstanding 162,911 162,781 162,848 162,772 Basic earnings (loss) per share $ 0.23 $ (0.34) $ 0.41 $ (0.14) Three Months Ended Six Months Ended (in thousands, except per share amounts) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Diluted earnings (loss) per share: Net income (loss) attributable to Driven Brands Holdings Inc. $ 37,749 $ (57,044) $ 67,498 $ (22,601) Less: Net income (loss) attributable to participating securities, diluted 708 (1,080) 1,267 (430) Net income (loss) after participating securities, diluted $ 37,041 $ (55,964) $ 66,231 $ (22,171) Weighted-average common shares outstanding 162,911 162,781 162,848 162,772 Dilutive effect of share-based awards 3,978 — 4,034 — Weighted-average common shares outstanding, as adjusted 166,888 162,781 166,882 162,772 Diluted earnings (loss) per share $ 0.22 $ (0.34) $ 0.40 $ (0.14) 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 4,881,630 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 six months ended July 1, 2023. The following securities were not included in the computation of diluted shares outstanding because the effect would be antidilutive: Three Months Ended Six Months Ended Number of securities (in thousands) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Stock Options 1,703 — 1,703 — Total 1,703 — 1,703 — |
Income Taxes
Income Taxes | 6 Months Ended |
Jul. 01, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s tax provision (benefit) is comprised of the most recent estimated annual effective tax rate applied to year-to-date ordinary income (loss) before taxes. The tax impacts of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are recorded discretely in the interim period in which they occur. Income tax expense was $20 million for the three months ended July 1, 2023 compared to an income tax benefit of $19 million for the three months ended June 25, 2022. The effective income tax rate for the three months ended July 1, 2023 was 34.9% compared to 24.8% for the three months ended June 25, 2022. The net increase in income tax expense and effective tax rate was primarily driven by a non-recurring tax benefit related to a trade name impairment for the three months ended June 25, 2022, partially offset by the inclusion of foreign disregarded entity losses for the three months ended July 1, 2023. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ 37,749 | $ (57,044) | $ 67,498 | $ (22,601) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jul. 01, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jul. 01, 2023 | |
Accounting Policies [Abstract] | |
Fiscal Year | 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 six months ended July 1, 2023 and June 25, 2022, each consisted of 13 weeks and 26 weeks, respectively. The Car Wash segment is currently consolidated based on a calendar month end. |
Basis of Presentation | 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, the unaudited interim financial data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results of operations, balance sheet, cash flows, and shareholders’/members’ equity for the interim periods presented. 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 unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the year ended December 31, 2022. Certain information and note disclosures normally included in the unaudited 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 six months ended July 1, 2023 may not be indicative of the results to be expected for any other interim period or the year ending December 30, 2023. Certain prior year amounts have been reclassified to conform to current year presentation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the unaudited consolidated financial statements and the related notes to the unaudited consolidated financial statements. Significant items that are subject to estimates and assumptions include, but are not limited to, valuation of intangible assets and goodwill; income taxes; allowances for credit losses; valuation of derivatives; self-insurance claims; and stock-based compensation. Management evaluates its estimates on an ongoing basis and may employ outside experts to assist in its evaluations. Changes in such estimates, based on historical experience, current conditions, and various other additional information, may affect amounts reported in future periods. Actual results could differ due to uncertainty inherent in the natures of these estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Financial assets and liabilities are categorized, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to the quoted prices in active markets for identical assets and liabilities and 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 has 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 is derived from valuation models, which use Level 2 observable inputs such as quoted market prices, interest rates, and forward yield curves. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . This ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates and, particularly, the risk of cessation of LIBOR, regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. This guidance is effective immediately and the amendments may be applied prospectively through December 31, 2024. On June 2, 2023, the Company entered into a loan amendment to transition our |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
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 July 1, 2023 and December 31, 2022 are summarized as follows: Items Measured at Fair Value at July 1, 2023 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 207 $ — $ 207 Derivative assets, recorded in other assets — 560 560 Derivative liabilities, recorded in accrued expenses and other liabilities — 494 494 Items Measured at Fair Value at December 31, 2022 (in thousands) Level 1 Level 2 Total Mutual fund investments held in rabbi trust $ 758 $ — $ 758 Derivative assets, recorded in prepaid and other assets — 158 158 Derivative assets, recorded in other assets — 2,148 2,148 Derivative liabilities, recorded in accrued expenses and other liabilities — 5,005 5,005 |
Schedule of Carrying Value and Estimated Fair Value of Total Long-Term Debt | The carrying value and estimated fair value of total long-term debt were as follows: July 1, 2023 December 31, 2022 (in thousands) Carrying value Estimated fair value Carrying value Estimated fair value Long-term debt $ 2,850,789 $ 2,592,533 $ 2,784,175 $ 2,477,456 |
Acquisitions and Dispositions (
Acquisitions and Dispositions (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Estimated Purchase Price Allocation | The provisional amounts for assets acquired and liabilities assumed for the 2023 acquisitions are as follows: Maintenance Segment (in thousands) Maintenance Assets: Operating lease right-of-use assets $ 658 Property and equipment, net 3,705 Goodwill 2,445 Assets acquired 6,808 Liabilities: Accrued Expenses and other liabilities 20 Operating lease liabilities 641 Total liabilities assumed 661 Cash consideration, net of cash acquired 5,862 Deferred consideration 285 Total consideration, net of cash acquired $ 6,147 Car Wash Segment (in thousands) Car Wash Assets: Property and equipment, net $ 11,052 Goodwill 3,948 Assets acquired 15,000 Total consideration, net of cash acquired $ 15,000 Paint, Collision & Glass Segment {in thousands) Paint, Collision & Glass Assets: Inventory $ 35 Property and equipment, net 667 Goodwill 4,940 Assets acquired 5,642 Cash consideration, net of cash acquired 4,947 Deferred consideration 695 Total consideration, net of cash acquired $ 5,642 |
Schedule of Deferred Consideration and Transaction Costs | Six Months Ended (in thousands) July 1, 2023 June 25, 2022 Deferred consideration at beginning of period $ 35,007 $ 16,000 Change in accrual 1,230 5,552 Payments (20,108) (7,325) Deferred consideration at end of period $ 16,129 $ 14,227 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Results | Segment results for the three and six months ended July 1, 2023 and June 25, 2022 are as follows: Three months ended July 1, 2023 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 14,215 $ — $ 26,530 $ 9,060 $ — $ 49,805 Company-operated store sales 205,673 101,615 86,110 1,180 — 394,578 Independently-operated store sales — 61,533 — — — 61,533 Advertising fund contributions — — — — 24,749 24,749 Supply and other revenue 22,439 1,607 20,518 47,098 (15,476) 76,186 Total revenue $ 242,327 $ 164,755 $ 133,158 $ 57,338 $ 9,273 $ 606,851 Segment Adjusted EBITDA $ 85,753 $ 43,263 $ 41,249 $ 22,537 $ (40,417) $ 152,385 Three months ended June 25, 2022 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 11,326 $ — $ 23,605 $ 9,919 $ — $ 44,850 Company-operated store sales 168,648 101,796 52,049 1,392 — 323,885 Independently-operated store sales — 54,942 — — — 54,942 Advertising fund contributions — — — — 22,091 22,091 Supply and other revenue 14,331 1,841 19,715 41,891 (14,922) 62,856 Total revenue $ 194,305 $ 158,579 $ 95,369 $ 53,202 $ 7,169 $ 508,624 Segment Adjusted EBITDA $ 64,076 $ 53,677 $ 32,916 $ 20,541 $ (35,123) $ 136,087 Six months ended July 1, 2023 (in thousands) Maintenance Car Wash Paint, Platform Services Corporate Total Franchise royalties and fees $ 26,658 $ — $ 50,828 $ 15,834 $ — $ 93,320 Company-operated store sales 400,933 204,061 163,589 2,061 — 770,644 Independently-operated store sales — 114,065 — — — 114,065 Advertising fund contributions — — — — 46,426 46,426 Supply and other revenue 42,404 3,609 39,544 91,476 (32,170) 144,863 Total revenue $ 469,995 $ 321,735 $ 253,961 $ 109,371 $ 14,256 $ 1,169,318 Segment Adjusted EBITDA $ 158,739 $ 87,572 $ 76,961 $ 39,567 $ (81,601) $ 281,238 Six months ended June 25, 2022 (in thousands) Maintenance Car Wash Paint, Platform Corporate Total Franchise royalties and fees $ 20,961 $ — $ 44,970 $ 16,807 $ — $ 82,738 Company-operated store sales 325,476 196,291 91,965 2,544 — 616,276 Independently-operated store sales — 118,031 — — — 118,031 Advertising fund contributions — — — — 41,789 41,789 Supply and other revenue 26,610 3,532 37,795 77,017 (26,841) 118,113 Total revenue $ 373,047 $ 317,854 $ 174,730 $ 96,368 $ 14,948 $ 976,947 Segment Adjusted EBITDA $ 116,561 $ 109,397 $ 61,928 $ 34,706 $ (67,485) $ 255,107 |
Schedule of Reconciliation of Segment Adjusted EBITDA to Income Before Taxes | The reconciliations of Income before taxes to Segment Adjusted EBITDA for the three and six months ended July 1, 2023 and June 25, 2022 are as follows: Three Months Ended Six Months Ended (in thousands) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Income (loss) before taxes $ 58,024 $ (75,892) $ 98,744 $ (28,496) Depreciation and amortization 45,419 38,087 83,617 71,110 Interest expense, net 40,871 26,270 79,012 51,623 Acquisition related costs (a) 3,750 3,338 5,597 7,656 Non-core items and project costs, net (b) 2,803 1,719 4,627 2,585 Store opening costs 1,377 666 2,402 1,172 Straight-line rent adjustment (c) 4,638 4,217 9,003 8,310 Equity-based compensation expense (d) 4,485 4,233 7,049 6,851 Foreign currency transaction (gain) / loss, net (e) (1,302) 13,937 (2,977) 14,908 Trade name impairment (f) — 125,450 — 125,450 Asset sale leaseback loss (gain), impairment and closed store expenses (g) (7,680) (5,938) (5,836) (6,062) Segment Adjusted EBITDA $ 152,385 $ 136,087 $ 281,238 $ 255,107 (a) Consists of acquisition costs as reflected within the unaudited 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 U.S. GAAP, such costs relating to acquisitions are expensed as incurred and not capitalized. (b) Consists of discrete items and project costs, including third party consulting and professional fees associated with strategic transformation initiatives as well as non-recurring payroll-related costs. (c) Consists of the non-cash portion of rent expense, which reflects the extent to which our straight-line rent expense recognized under U.S. GAAP exceeds or is less than our cash rent payments. (d) Represents non-cash equity-based compensation expense. (e) Represents foreign currency transaction (gains) losses, net that primarily related to the remeasurement of our intercompany loans, which are partially offset by unrealized gains and losses on remeasurement of cross currency swaps and forward contracts. (f) Relates to an impairment of certain Car Wash trade names as the Company elected to discontinue their use. (g) Relates to (gains) losses, net on sale leasebacks, impairment of certain fixed assets and operating lease right-of-use assets related to closed locations, and lease exit costs and other costs associated with stores that were closed prior to the respective lease termination dates. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt Obligations | The Company’s long-term debt obligations consist of the following: (in thousands) July 1, 2023 December 31, 2022 Series 2018-1 Securitization Senior Notes, Class A-2 $ 260,563 $ 261,938 Series 2019-1 Securitization Senior Notes, Class A-2 286,500 288,000 Series 2019-2 Securitization Senior Notes, Class A-2 264,688 266,063 Series 2020-1 Securitization Senior Notes, Class A-2 169,750 170,625 Series 2020-2 Securitization Senior Notes, Class A-2 438,750 441,000 Series 2021-1 Securitization Senior Notes, Class A-2 442,125 444,375 Series 2022-1 Securitization Senior Notes, Class A-2 362,263 364,088 Term Loan Facility 493,750 496,250 Revolving Credit Facility 110,000 — Other debt (a) 22,400 51,836 Total debt 2,850,789 2,784,175 Less: unamortized debt issuance costs (39,234) (45,908) Less: current portion of long-term debt (32,044) (32,986) Total long-term debt, net $ 2,779,511 $ 2,705,281 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Leases [Abstract] | |
Schedule of Cash Flow Related to Lease Arrangements | Supplemental cash flow information related to the Company’s lease arrangements for the six months ended July 1, 2023 and June 25, 2022, respectively, was as follows: Six Months Ended (in thousands) July 1, 2023 June 25, 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 67,107 $ 57,330 Operating cash flows used in finance leases 810 785 Financing cash flows used in finance leases 953 829 |
Equity-based Compensation (Tabl
Equity-based Compensation (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Valuation Assumptions | The range of assumptions used for issued PSUs with a market condition valued using the Monte Carlo model were as follows: Six months ended July 1, 2023 June 25, 2022 Annual dividend yield —% —% Expected term (years) 2.6 - 2.8 2.7 - 2.8 Risk-free interest rate 3.65% - 4.51% 2.32% - 2.76% Expected volatility 37.9% - 38.8% 40.9% - 43.9% Correlation to the index peer group 60.2% - 60.3% 50.7% - 59.5% |
Earnings (loss) per share (Tabl
Earnings (loss) per share (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings (Loss) Per Share Attributable to Common Shareholders | The following table sets forth the computation of basic and diluted earnings per share attributable to common shareholders: Three Months Ended Six Months Ended (in thousands, except per share amounts) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Basic earnings (loss) per share: Net income (loss) attributable to Driven Brands Holdings Inc. $ 37,749 (57,044) $ 67,498 (22,601) Less: Net income (loss) attributable to participating securities, basic 794 (1,210) 1,420 (481) Net income (loss) after participating securities, basic 36,955 (55,834) 66,078 (22,120) Weighted-average common shares outstanding 162,911 162,781 162,848 162,772 Basic earnings (loss) per share $ 0.23 $ (0.34) $ 0.41 $ (0.14) Three Months Ended Six Months Ended (in thousands, except per share amounts) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Diluted earnings (loss) per share: Net income (loss) attributable to Driven Brands Holdings Inc. $ 37,749 $ (57,044) $ 67,498 $ (22,601) Less: Net income (loss) attributable to participating securities, diluted 708 (1,080) 1,267 (430) Net income (loss) after participating securities, diluted $ 37,041 $ (55,964) $ 66,231 $ (22,171) Weighted-average common shares outstanding 162,911 162,781 162,848 162,772 Dilutive effect of share-based awards 3,978 — 4,034 — Weighted-average common shares outstanding, as adjusted 166,888 162,781 166,882 162,772 Diluted earnings (loss) per share $ 0.22 $ (0.34) $ 0.40 $ (0.14) |
Schedule of Antidilutive Shares | The following securities were not included in the computation of diluted shares outstanding because the effect would be antidilutive: Three Months Ended Six Months Ended Number of securities (in thousands) July 1, 2023 June 25, 2022 July 1, 2023 June 25, 2022 Stock Options 1,703 — 1,703 — Total 1,703 — 1,703 — |
Description of Business (Detail
Description of Business (Details) $ in Thousands | Jul. 01, 2023 USD ($) franchise_location | Dec. 31, 2022 USD ($) | Jan. 14, 2021 |
Subsidiary, Sale of Stock [Line Items] | |||
Number of locations franchised, independently-operated, and company-operated | 4,900 | ||
Number of states in which entity operates | 49 | ||
Number of countries across europe in which entity operates | 13 | ||
Percentage of locations franchised or independently operated | 0.74 | ||
Income tax receivable liability, current | $ | $ 53,781 | $ 53,328 | |
Income tax receivable liability, noncurrent | $ | $ 117,915 | $ 117,915 | |
Pre-IPO Stockholders | |||
Subsidiary, Sale of Stock [Line Items] | |||
Income taxes receivable percentage | 0.85 |
Summary of Significant Accoun_4
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 | Jul. 01, 2023 | Dec. 31, 2022 |
Subsidiary, Sale of Stock [Line Items] | ||
Mutual fund investments held in rabbi trust | $ 207 | $ 758 |
Prepaid Expenses and Other Current Assets | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative asset | 158 | |
Other Assets | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative asset | 560 | 2,148 |
Other Noncurrent Liabilities | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative liabilities, recorded in accrued expenses and other liabilities | 494 | 5,005 |
Level 1 | ||
Subsidiary, Sale of Stock [Line Items] | ||
Mutual fund investments held in rabbi trust | 207 | 758 |
Level 1 | Prepaid Expenses and Other Current Assets | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative asset | 0 | |
Level 1 | Other Assets | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative asset | 0 | 0 |
Level 1 | Other Noncurrent Liabilities | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative liabilities, recorded in accrued expenses and other liabilities | 0 | 0 |
Level 2 | ||
Subsidiary, Sale of Stock [Line Items] | ||
Mutual fund investments held in rabbi trust | 0 | 0 |
Level 2 | Prepaid Expenses and Other Current Assets | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative asset | 158 | |
Level 2 | Other Assets | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative asset | 560 | 2,148 |
Level 2 | Other Noncurrent Liabilities | ||
Subsidiary, Sale of Stock [Line Items] | ||
Derivative liabilities, recorded in accrued expenses and other liabilities | $ 494 | $ 5,005 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Carrying Value and Estimated Fair Value of Total Long-Term Debt (Details) - USD ($) $ in Thousands | Jul. 01, 2023 | Dec. 31, 2022 |
Carrying value | ||
Subsidiary, Sale of Stock [Line Items] | ||
Long-term debt | $ 2,850,789 | $ 2,784,175 |
Estimated fair value | ||
Subsidiary, Sale of Stock [Line Items] | ||
Long-term debt | $ 2,592,533 | $ 2,477,456 |
Acquisitions and Dispositions -
Acquisitions and Dispositions - Narrative (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 16, 2022 USD ($) | Jul. 01, 2023 USD ($) | Jun. 25, 2022 USD ($) | Jul. 01, 2023 USD ($) car_wash_site maintenance_site acquisition | Jun. 25, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Business Acquisition [Line Items] | ||||||
Cash used in business acquisitions, net of cash acquired | $ 44,868 | $ 394,388 | ||||
Acquisition costs (less than) | $ 3,750 | $ 3,338 | 5,597 | 7,656 | ||
Consideration received | 144,000 | 55,000 | 144,000 | 55,000 | ||
Net loss on disposal (less than) | (25,000) | (7,000) | ||||
Goodwill | 2,299,953 | $ 2,299,953 | $ 2,277,065 | |||
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 | ||||||
Business Acquisition [Line Items] | ||||||
Ownership interest, percentage | 75% | |||||
Consideration received | $ 2,000 | |||||
Net loss on disposal (less than) | 1,000 | |||||
Derecognized noncontrolling interest | 1,000 | |||||
Goodwill | $ 1,000 | |||||
2023 Acquisitions | Maintenance | ||||||
Business Acquisition [Line Items] | ||||||
Number of businesses acquired | acquisition | 3 | |||||
Number of maintenance sites | maintenance_site | 3 | |||||
Cash used in business acquisitions, net of cash acquired | $ 6,000 | |||||
2023 Acquisitions | Car Wash | ||||||
Business Acquisition [Line Items] | ||||||
Number of businesses acquired | acquisition | 2 | |||||
Cash used in business acquisitions, net of cash acquired | $ 15,000 | |||||
Number of car wash sites | car_wash_site | 3 | |||||
2023 Acquisitions | Paint, Collision & Glass | ||||||
Business Acquisition [Line Items] | ||||||
Number of businesses acquired | acquisition | 2 | |||||
Number of maintenance sites | maintenance_site | 2 | |||||
Cash used in business acquisitions, net of cash acquired | $ 6,000 | |||||
Business Acquisition | ||||||
Business Acquisition [Line Items] | ||||||
Acquisition costs (less than) | $ 1,000 | $ 1,000 | $ 1,000 | $ 3,000 |
Acquisitions and Dispositions_2
Acquisitions and Dispositions - Schedule of Estimated Purchase Price Allocation (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Dec. 31, 2022 | |
Assets: | |||
Goodwill | $ 2,299,953 | $ 2,277,065 | |
Liabilities: | |||
Cash consideration, net of cash acquired | 44,868 | $ 394,388 | |
2023 Maintenance Acquisitions | |||
Assets: | |||
Operating lease right-of-use assets | 658 | ||
Property and equipment, net | 3,705 | ||
Goodwill | 2,445 | ||
Assets acquired | 6,808 | ||
Liabilities: | |||
Accrued Expenses and other liabilities | 20 | ||
Operating lease liabilities | 641 | ||
Total liabilities assumed | 661 | ||
Cash consideration, net of cash acquired | 5,862 | ||
Deferred consideration | 285 | ||
Total consideration, net of cash acquired | 6,147 | ||
2023 Car Wash Acquisitions | |||
Assets: | |||
Property and equipment, net | 11,052 | ||
Goodwill | 3,948 | ||
Assets acquired | 15,000 | ||
Liabilities: | |||
Total consideration, net of cash acquired | 15,000 | ||
Paint, Collision & Glass | |||
Assets: | |||
Property and equipment, net | 667 | ||
Goodwill | 4,940 | ||
Inventory | 35 | ||
Assets acquired | 5,642 | ||
Liabilities: | |||
Cash consideration, net of cash acquired | 4,947 | ||
Deferred consideration | 695 | ||
Total consideration, net of cash acquired | $ 5,642 |
Acquisitions and Dispositions_3
Acquisitions and Dispositions - Schedule of Deferred Consideration and Transaction Costs (Details) - 2022 Acquisitions - USD ($) $ in Thousands | 6 Months Ended | |
Jul. 01, 2023 | Jun. 25, 2022 | |
Deferred Consideration [Roll Forward] | ||
Deferred consideration at beginning of period | $ 35,007 | $ 16,000 |
Change in accrual | 1,230 | 5,552 |
Payments | (20,108) | (7,325) |
Deferred consideration at end of period | $ 16,129 | $ 14,227 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |||||
Capitalized costs to obtain a contract | $ 6 | $ 6 | $ 7 | ||
Contract assets | 1 | $ 1 | 1 | $ 1 | |
Contract liabilities | 31 | 31 | $ 29 | ||
Revenue recognized (less than) | $ 1 | $ 1 | $ 2 | $ 2 |
Segment Information - Schedule
Segment Information - Schedule of Segment Results (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Segment Reporting Information [Line Items] | ||||
Total revenue | $ 606,851 | $ 508,624 | $ 1,169,318 | $ 976,947 |
Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 49,805 | 44,850 | 93,320 | 82,738 |
Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 394,578 | 323,885 | 770,644 | 616,276 |
Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 61,533 | 54,942 | 114,065 | 118,031 |
Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 24,749 | 22,091 | 46,426 | 41,789 |
Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 76,186 | 62,856 | 144,863 | 118,113 |
Operating Segments | Maintenance | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 242,327 | 194,305 | 469,995 | 373,047 |
Segment Adjusted EBITDA | 85,753 | 64,076 | 158,739 | 116,561 |
Operating Segments | Maintenance | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 14,215 | 11,326 | 26,658 | 20,961 |
Operating Segments | Maintenance | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 205,673 | 168,648 | 400,933 | 325,476 |
Operating Segments | Maintenance | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Maintenance | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Maintenance | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 22,439 | 14,331 | 42,404 | 26,610 |
Operating Segments | Car Wash | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 164,755 | 158,579 | 321,735 | 317,854 |
Segment Adjusted EBITDA | 43,263 | 53,677 | 87,572 | 109,397 |
Operating Segments | Car Wash | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Car Wash | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 101,615 | 101,796 | 204,061 | 196,291 |
Operating Segments | Car Wash | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 61,533 | 54,942 | 114,065 | 118,031 |
Operating Segments | Car Wash | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Car Wash | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 1,607 | 1,841 | 3,609 | 3,532 |
Operating Segments | Paint, Collision & Glass | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 133,158 | 95,369 | 253,961 | 174,730 |
Segment Adjusted EBITDA | 41,249 | 32,916 | 76,961 | 61,928 |
Operating Segments | Paint, Collision & Glass | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 26,530 | 23,605 | 50,828 | 44,970 |
Operating Segments | Paint, Collision & Glass | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 86,110 | 52,049 | 163,589 | 91,965 |
Operating Segments | Paint, Collision & Glass | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Paint, Collision & Glass | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Paint, Collision & Glass | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 20,518 | 19,715 | 39,544 | 37,795 |
Operating Segments | Platform Services | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 57,338 | 53,202 | 109,371 | 96,368 |
Segment Adjusted EBITDA | 22,537 | 20,541 | 39,567 | 34,706 |
Operating Segments | Platform Services | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 9,060 | 9,919 | 15,834 | 16,807 |
Operating Segments | Platform Services | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 1,180 | 1,392 | 2,061 | 2,544 |
Operating Segments | Platform Services | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Platform Services | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Platform Services | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 47,098 | 41,891 | 91,476 | 77,017 |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 9,273 | 7,169 | 14,256 | 14,948 |
Segment Adjusted EBITDA | (40,417) | (35,123) | (81,601) | (67,485) |
Corporate and Other | Franchise royalties and fees | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Corporate and Other | Company-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Corporate and Other | Independently-operated store sales | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Corporate and Other | Advertising fund contributions | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 24,749 | 22,091 | 46,426 | 41,789 |
Corporate and Other | Supply and other revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | $ (15,476) | $ (14,922) | $ (32,170) | $ (26,841) |
Segment Information - Schedul_2
Segment Information - Schedule of Reconciliation of Segment Adjusted EBITDA to Income Before Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization | $ 83,617 | $ 71,110 | ||
Interest expense, net | $ 40,871 | $ 26,270 | 79,012 | 51,623 |
Acquisition related costs | 3,750 | 3,338 | 5,597 | 7,656 |
Store opening costs | 1,377 | 666 | 2,402 | 1,172 |
Trade name impairment | 0 | 125,450 | 0 | 125,450 |
Trade Names | ||||
Segment Reporting Information [Line Items] | ||||
Trade name impairment | 125,500 | |||
Segment Reconciling Items | ||||
Segment Reporting Information [Line Items] | ||||
Income (loss) before taxes | 58,024 | (75,892) | 98,744 | (28,496) |
Depreciation and amortization | 45,419 | 38,087 | 83,617 | 71,110 |
Interest expense, net | 40,871 | 26,270 | 79,012 | 51,623 |
Acquisition related costs | 3,750 | 3,338 | 5,597 | 7,656 |
Non-core items and project costs, net | 2,803 | 1,719 | 4,627 | 2,585 |
Store opening costs | 1,377 | 666 | 2,402 | 1,172 |
Straight-line rent adjustment | 4,638 | 4,217 | 9,003 | 8,310 |
Equity-based compensation expense | 4,485 | 4,233 | 7,049 | 6,851 |
Foreign currency transaction (gain) / loss, net | (1,302) | 13,937 | (2,977) | 14,908 |
Asset sale leaseback loss (gain), impairment and closed store expenses | (7,680) | (5,938) | (5,836) | (6,062) |
Segment Adjusted EBITDA | 152,385 | 136,087 | 281,238 | 255,107 |
Segment Reconciling Items | Trade Names | ||||
Segment Reporting Information [Line Items] | ||||
Trade name impairment | $ 0 | $ 125,450 | $ 0 | $ 125,450 |
Other Intangible Assets (Detail
Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Indefinite-Lived Intangible Assets [Line Items] | ||||
Trade name impairment | $ 0 | $ 125,450 | $ 0 | $ 125,450 |
Trade Names | ||||
Indefinite-Lived Intangible Assets [Line Items] | ||||
Intangible assets fair value | 6,000 | 6,000 | ||
Intangible assets | 131,500 | $ 131,500 | ||
Trade name impairment | $ 125,500 | |||
Amortization period for remaining carrying value | 30 months | 30 months | ||
Trade Names | Maximum | ||||
Indefinite-Lived Intangible Assets [Line Items] | ||||
Amortization period for remaining carrying value | 2 years 6 months | 2 years 6 months |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt Obligations (Details) - USD ($) $ in Thousands | Jul. 01, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Total debt | $ 2,850,789 | $ 2,784,175 |
Less: unamortized debt issuance costs | (39,234) | (45,908) |
Less: current portion of long-term debt | (32,044) | (32,986) |
Total long-term debt, net | 2,779,511 | 2,705,281 |
Senior notes | Series 2018-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 260,563 | 261,938 |
Senior notes | Series 2019-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 286,500 | 288,000 |
Senior notes | Series 2019-2 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 264,688 | 266,063 |
Senior notes | Series 2020-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 169,750 | 170,625 |
Senior notes | Series 2020-2 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 438,750 | 441,000 |
Senior notes | Series 2021-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 442,125 | 444,375 |
Senior notes | Series 2022-1 Securitization Senior Notes, Class A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | 362,263 | 364,088 |
Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Total debt | 493,750 | 496,250 |
Revolving Credit Facility | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Total debt | 110,000 | 0 |
Other debt | ||
Debt Instrument [Line Items] | ||
Total debt | $ 22,400 | $ 51,836 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) | 1 Months Ended | 6 Months Ended | |||
Dec. 31, 2019 USD ($) extension_option | Jul. 01, 2023 USD ($) | Jun. 25, 2022 USD ($) | Dec. 31, 2022 USD ($) | May 31, 2021 USD ($) | |
Debt Instrument [Line Items] | |||||
Total debt | $ 2,850,789,000 | $ 2,784,175,000 | |||
Proceeds from revolving lines of credit and short-term debt | 230,000,000 | $ 105,000,000 | |||
Repayments of revolving lines of credit and short-term debt | (120,000,000) | $ 0 | |||
Revolving Credit Facility | Series 2019-3 Variable Funding Senior Notes, Class A-1 | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 115,000,000 | ||||
Number of extension options | extension_option | 3 | ||||
Extension period | 1 year | ||||
Outstanding debt | 0 | ||||
Borrowings or repayments of debt | 0 | ||||
Outstanding letters of credit | $ 25,000,000 | ||||
Revolving Credit Facility | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 300,000,000 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Thousands | 6 Months Ended | ||||||||
Jul. 01, 2023 USD ($) | Jun. 25, 2022 USD ($) | Jul. 01, 2023 USD ($) | Jul. 01, 2023 maintenance_site | Jul. 01, 2023 car_wash_site | Dec. 31, 2022 USD ($) | Jun. 25, 2022 USD ($) | Jun. 25, 2022 maintenance_site | Jun. 25, 2022 car_wash_site | |
Lessee, Lease, Description [Line Items] | |||||||||
Number cash wash properties sold | 4 | 33 | 6,000 | 10,000 | |||||
Total consideration | $ 144,000 | $ 55,000 | |||||||
Net gain on sale | $ 25,000 | $ 7,000 | |||||||
Operating lease right-of-use assets | 1,449,708 | $ 1,299,189 | |||||||
March 2021 Operating Lease Agreements | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Operating lease right-of-use assets | 112,000 | 47,000 | |||||||
Operating lease liability | $ 112,000 | $ 47,000 | |||||||
Minimum | March 2021 Operating Lease Agreements | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Lease term | 18 years | 15 years | |||||||
Maximum | March 2021 Operating Lease Agreements | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Lease term | 20 years | 20 years |
Leases - Schedule of Cash Flow
Leases - Schedule of Cash Flow Related to Lease Arrangements (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jul. 01, 2023 | Jun. 25, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows used in operating leases | $ 67,107 | $ 57,330 |
Operating cash flows used in finance leases | 810 | 785 |
Financing cash flows used in finance leases | $ 953 | $ 829 |
Equity-based Compensation - Nar
Equity-based Compensation - Narrative (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 USD ($) Installment shares | Jun. 25, 2022 USD ($) | Jul. 01, 2023 USD ($) Installment shares | Jun. 25, 2022 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Equity-based compensation expense | $ 4,000 | $ 4,000 | $ 7,049 | $ 6,851 |
Restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of granted new awards (in shares) | shares | 68,119 | 380,736 | ||
Grant-date fair value of PSUs granted | $ 2,000 | $ 11,000 | ||
Performance stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of granted new awards (in shares) | shares | 72,092 | 647,359 | ||
Number of vesting installments | Installment | 3 | 3 | ||
Award vesting period | 3 years | |||
Performance stock units | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting rights percentage | 0% | |||
Performance stock units | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting rights percentage | 200% | |||
Restricted stock award, performance based PSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grant-date fair value of PSUs granted | $ 1,000 | $ 11,000 | ||
Restricted stock award, market-based PSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grant-date fair value of PSUs granted | $ 1,000 | $ 9,000 |
Equity-based Compensation - Sch
Equity-based Compensation - Schedule of Valuation Assumptions (Details) - Performance stock units | 6 Months Ended | |
Jul. 01, 2023 | Jun. 25, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Annual dividend yield | 0% | 0% |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected term (years) | 2 years 7 months 6 days | 2 years 8 months 12 days |
Risk-free interest rate | 3.65% | 2.32% |
Expected volatility | 37.90% | 40.90% |
Correlation to the index peer group | 60.20% | 50.70% |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected term (years) | 2 years 9 months 18 days | 2 years 9 months 18 days |
Risk-free interest rate | 4.51% | 2.76% |
Expected volatility | 38.80% | 43.90% |
Correlation to the index peer group | 60.30% | 59.50% |
Earnings (loss) per share - Sch
Earnings (loss) per share - Schedule of Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Basic earnings (loss) per share: | ||||
Net income (loss) attributable to Driven Brands Holdings Inc. | $ 37,749 | $ (57,044) | $ 67,498 | $ (22,601) |
Less: Net income (loss) attributable to participating securities, basic | 794 | (1,210) | 1,420 | (481) |
Net income (loss) after participating securities, basic | $ 36,955 | $ (55,834) | $ 66,078 | $ (22,120) |
Weighted-average common shares outstanding (in shares) | 162,911 | 162,781 | 162,848 | 162,772 |
Basic earnings (loss) per share (in dollars per share) | $ 0.23 | $ (0.34) | $ 0.41 | $ (0.14) |
Diluted earnings (loss) per share: | ||||
Less: Net income (loss) attributable to participating securities, diluted | $ 708 | $ (1,080) | $ 1,267 | $ (430) |
Net income (loss) after participating securities, diluted | $ 37,041 | $ (55,964) | $ 66,231 | $ (22,171) |
Dilutive effect of share-based awards (in shares) | 3,978 | 0 | 4,034 | 0 |
Weighted-average common shares outstanding, as adjusted (in shares) | 166,888 | 162,781 | 166,882 | 162,772 |
Diluted earnings (loss) per share (in dollars per share) | $ 0.22 | $ (0.34) | $ 0.40 | $ (0.14) |
Earnings (loss) per share - Nar
Earnings (loss) per share - Narrative (Details) - shares | 3 Months Ended | 6 Months Ended |
Jul. 01, 2023 | Jul. 01, 2023 | |
Earnings Per Share [Abstract] | ||
Performance awards contingent on performance conditions which have not been met yet (in shares) | 4,881,630 | 4,881,630 |
Earnings (loss) per share - S_2
Earnings (loss) per share - Schedule of Antidilutive Shares (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 1,703 | 0 | 1,703 | 0 |
Stock Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 1,703 | 0 | 1,703 | 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jun. 25, 2022 | Jul. 01, 2023 | Jun. 25, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 20,275 | $ (18,848) | $ 31,246 | $ (5,880) |
Effective income tax rate | 34.90% | 24.80% | 31.60% | 20.60% |