Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 30, 2014 | 2-May-14 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'WENDY'S CO | ' |
Entity Central Index Key | '0000030697 | ' |
Current Fiscal Year End Date | '--12-28 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 366,812,087 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 30, 2014 | Dec. 29, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $384,695 | $580,152 |
Accounts and notes receivable | 63,192 | 62,885 |
Inventories | 9,032 | 10,226 |
Prepaid expenses and other current assets | 65,847 | 81,759 |
Deferred income tax benefit | 116,319 | 120,206 |
Advertising funds restricted assets | 71,653 | 67,183 |
Total current assets | 710,738 | 922,411 |
Properties | 1,146,996 | 1,165,487 |
Goodwill | 826,686 | 842,544 |
Other intangible assets | 1,344,862 | 1,305,780 |
Investments | 79,909 | 83,197 |
Deferred costs and other assets | 44,886 | 43,621 |
Total assets | 4,154,077 | 4,363,040 |
Current liabilities: | ' | ' |
Current portion of long-term debt | 37,814 | 38,543 |
Accounts payable | 60,397 | 83,700 |
Accrued expenses and other current liabilities | 139,047 | 160,100 |
Advertising funds restricted liabilities | 71,653 | 67,183 |
Total current liabilities | 308,911 | 349,526 |
Long-term debt | 1,423,756 | 1,425,285 |
Deferred income taxes | 492,264 | 482,499 |
Other liabilities | 205,992 | 176,244 |
Commitments and contingencies | ' | ' |
Stockholders’ equity: | ' | ' |
Common stock, $0.10 par value; 1,500,000 shares authorized; 470,424 shares issued | 47,042 | 47,042 |
Additional paid-in capital | 2,826,224 | 2,794,445 |
Accumulated deficit | -464,228 | -492,215 |
Common stock held in treasury, at cost; 103,736 and 77,637 shares | -668,207 | -409,449 |
Accumulated other comprehensive loss | -17,677 | -10,337 |
Total stockholders’ equity | 1,723,154 | 1,929,486 |
Total liabilities and stockholders’ equity | $4,154,077 | $4,363,040 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets Balance Sheet Parentheticals (USD $) | Mar. 30, 2014 | Dec. 29, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Common Stock, Par Value Per Share | $0.10 | $0.10 |
Common Stock, Shares Authorized | 1,500,000 | 1,500,000 |
Common Stock, Shares Issued | 470,424 | 470,424 |
Treasury Stock, Shares | 103,736 | 77,637 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Revenues: | ' | ' |
Sales | $432,630 | $530,673 |
Franchise revenues | 90,566 | 73,009 |
Revenues | 523,196 | 603,682 |
Costs and expenses: | ' | ' |
Cost of sales | 374,190 | 460,828 |
General and administrative | 70,366 | 65,310 |
Depreciation and amortization | 42,021 | 51,797 |
Facilities action (income) charges, net | -44,033 | 3,038 |
Impairment of long-lived assets | 332 | 0 |
Other operating (income) expense, net | -8,694 | 245 |
Costs and expenses | 434,182 | 581,218 |
Operating profit | 89,014 | 22,464 |
Interest expense | -12,994 | -20,964 |
Other income (expense), net | 523 | -2,271 |
Income (loss) before income taxes | 76,543 | -771 |
(Provision for) benefit from income taxes | -30,240 | 2,904 |
Net income | $46,303 | $2,133 |
Earnings Per Share, Basic and Diluted [Abstract] | ' | ' |
Basic and diluted net income per share | $0.12 | $0.01 |
Dividends per share | $0.05 | $0.04 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Net income | $46,303 | $2,133 |
Other comprehensive loss, net: | ' | ' |
Foreign currency translation adjustment | -7,220 | -5,069 |
Change in unrecognized pension loss, net of income tax (provision) benefit of $(213) and $37, respectively | 338 | -62 |
Unrealized loss on cash flow hedges, net of income tax benefit of $287 | -458 | 0 |
Other comprehensive loss, net | -7,340 | -5,131 |
Comprehensive income (loss) | $38,963 | ($2,998) |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' |
Change in unrecognized pension loss, income tax (provision) benefit | ($213) | $37 |
Unrealized loss on cash flow hedges, income tax benefit | $287 | $0 |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Cash flows from operating activities: | ' | ' |
Net income | $46,303 | $2,133 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 42,496 | 52,382 |
Share-based compensation | 10,584 | 3,010 |
System Optimization Remeasurement | 2,197 | 0 |
Impairment of long-lived assets | 332 | 0 |
Deferred income tax | 32,620 | 2,593 |
Excess tax benefits from share-based compensation | -18,144 | 0 |
Non-cash rent expense | 1,726 | 2,156 |
Net receipt (recognition) of deferred vendor incentives | 16,800 | -4,797 |
Gain on sales of restaurants, net | -60,941 | 0 |
Gain on disposal of assets, net | -12,051 | 0 |
Distributions received from TimWen joint venture | 3,164 | 2,701 |
Equity in earnings in joint ventures, net | -2,156 | -1,191 |
Accretion of long-term debt | 296 | 1,929 |
Amortization of deferred financing costs | 566 | 762 |
Other, net | -6,571 | -7,784 |
Changes in operating assets and liabilities: | ' | ' |
Accounts and notes receivable | -340 | 1,858 |
Inventories | 1,156 | 1,285 |
Prepaid expenses and other current assets | -6,057 | 148 |
Accounts payable | -3,012 | -2,409 |
Accrued expenses and other current liabilities | -34,227 | -22,172 |
Net cash provided by operating activities | 14,741 | 32,604 |
Cash flows from investing activities: | ' | ' |
Capital expenditures | -53,058 | -39,977 |
Dispositions | 108,457 | 2,104 |
Franchise loans, Net | 292 | 127 |
Other, net | 33 | 151 |
Net cash provided by (used in) investing activities | 55,724 | -37,595 |
Cash flows from financing activities: | ' | ' |
Repayments of long-term debt | -9,900 | -6,506 |
Repurchases of common stock | -277,261 | 0 |
Dividends | -18,306 | -15,703 |
Proceeds from stock option exercises | 23,147 | 3,564 |
Excess tax benefits from share-based compensation | 18,144 | 0 |
Net cash used in financing activities | -264,176 | -18,645 |
Net cash used in operations before effect of exchange rate changes on cash | -193,711 | -23,636 |
Effect of exchange rate changes on cash | -1,746 | -1,041 |
Net decrease in cash and cash equivalents | -195,457 | -24,677 |
Cash and cash equivalents at beginning of period | 580,152 | 453,361 |
Cash and cash equivalents at end of period | 384,695 | 428,684 |
Cash paid for: | ' | ' |
Interest | 11,368 | 18,914 |
Income taxes (refunds), net | 2,270 | -306 |
Supplemental non-cash investing and financing activities: | ' | ' |
Capital expenditures included in accounts payable | 25,152 | 12,897 |
Capitalized lease obligations | $7,523 | $1,035 |
Basis_of_Presentation
Basis of Presentation | 3 Months Ended |
Mar. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying unaudited condensed consolidated financial statements (the “Financial Statements”) of The Wendy’s Company (“The Wendy’s Company” and, together with its subsidiaries, the “Company,” “we,” “us” or “our”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and therefore, do not include all information and footnotes required by GAAP for complete financial statements. In our opinion, the Financial Statements contain all adjustments necessary to present fairly our financial position as of March 30, 2014 and the results of our operations and cash flows for the three months ended March 30, 2014 and March 31, 2013. The results of operations for the three months ended March 30, 2014 are not necessarily indicative of the results to be expected for the full 2014 fiscal year. These Financial Statements should be read in conjunction with the audited consolidated financial statements for The Wendy’s Company and notes thereto, included in our Annual Report on Form 10-K for the fiscal year ended December 29, 2013 (the “Form 10-K”). | |
The principal subsidiary of the Company is Wendy’s International, LLC (“Wendy’s”) and its subsidiaries (formerly known as Wendy’s International, Inc.). The Company manages and internally reports its business geographically. The operation and franchising of Wendy’s® restaurants in North America (defined as the U.S. and Canada) comprises virtually all of our current operations and represents a single reportable segment. The revenues and operating results of Wendy’s restaurants outside of North America are not material. | |
We report on a fiscal year consisting of 52 or 53 weeks ending on the Sunday closest to December 31. All three month periods presented herein contain 13 weeks. All references to years and quarters relate to fiscal periods rather than calendar periods. | |
Certain reclassifications have been made to prior year presentation to conform to the current year presentation. | |
In connection with the reimaging of restaurants as part of our Image Activation program, we have recorded $9,558 and $14,508 of accelerated depreciation and amortization during the three months ended March 30, 2014 and March 31, 2013, respectively, on certain long-lived assets to reflect their use over shortened estimated useful lives. We describe the circumstances under which we record accelerated depreciation and amortization for properties in our Form 10-K. |
Facilities_Action_Income_Charg
Facilities Action (Income) Charges, Net | 3 Months Ended | ||||||||||||||||
Mar. 30, 2014 | |||||||||||||||||
Facilities Action Charges, Net [Abstract] | ' | ||||||||||||||||
Facilities Action (Income) Charges, Net | ' | ||||||||||||||||
Facilities Action (Income) Charges, Net | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 30, 2014 | March 31, 2013 | ||||||||||||||||
System optimization initiative | $ | (44,033 | ) | $ | — | ||||||||||||
Facilities relocation and other transition costs | — | 2,170 | |||||||||||||||
Breakfast discontinuation | — | 668 | |||||||||||||||
Arby’s transaction related costs | — | 200 | |||||||||||||||
$ | (44,033 | ) | $ | 3,038 | |||||||||||||
System Optimization Initiative | |||||||||||||||||
The Company completed its system optimization initiative, announced in July 2013, with the sale of 174 company-owned restaurants to franchisees during the first quarter of 2014. In total, the Company has sold 418 restaurants during 2013 and 2014, under its system optimization initiative. This initiative also included the consolidation of regional and divisional territories which was completed as of the beginning of the 2014 fiscal year. As a result of the system optimization initiative, the Company recorded losses on remeasuring long-lived assets to fair value upon determination that the assets were going to be leased and/or subleased to franchisees in connection with the sale of restaurants (“System Optimization Remeasurement”). Gains or losses recognized on sales of restaurants under the system optimization initiative, as well as costs incurred related to the system optimization initiative are recorded to “Facilities action (income) charges, net” in our condensed consolidated statements of operations. The Company anticipates post-closing adjustments on sales of restaurants; however, it does not anticipate any significant additional charges under the system optimization initiative. | |||||||||||||||||
The following is a summary of the activity recorded under our system optimization initiative: | |||||||||||||||||
Three Months Ended | Total Incurred Since Inception | ||||||||||||||||
30-Mar-14 | |||||||||||||||||
Gain on sales of restaurants, net | $ | (60,941 | ) | $ | (107,608 | ) | |||||||||||
System Optimization Remeasurement (a) | 2,197 | 22,703 | |||||||||||||||
Accelerated amortization (b) | 475 | 17,382 | |||||||||||||||
Severance and related employee costs | 5,533 | 15,183 | |||||||||||||||
Share-based compensation (c) | 3,635 | 4,888 | |||||||||||||||
Professional fees | 2,631 | 5,020 | |||||||||||||||
Other | 2,437 | 3,300 | |||||||||||||||
Total system optimization initiative | $ | (44,033 | ) | $ | (39,132 | ) | |||||||||||
_______________ | |||||||||||||||||
(a) | Includes remeasurement of land, buildings, leasehold improvements and favorable lease assets at all company-owned restaurants included in our system optimization initiative. See Note 5 for more information on non-recurring fair value measurements. | ||||||||||||||||
(b) | Includes accelerated amortization of previously acquired franchise rights related to company-owned restaurants in territories that were sold in connection with our system optimization initiative. | ||||||||||||||||
(c) | Represents incremental share-based compensation resulting from the modification of stock options and performance-based awards in connection with the termination of employees under our system optimization initiative. | ||||||||||||||||
Gain on Sales of Restaurants, Net | |||||||||||||||||
Three Months Ended | |||||||||||||||||
30-Mar-14 | |||||||||||||||||
Number of restaurants sold to franchisees | 174 | ||||||||||||||||
Proceeds from sales of restaurants | $ | 94,991 | |||||||||||||||
Net assets sold (a) | (41,219 | ) | |||||||||||||||
Goodwill related to sales of restaurants | (12,643 | ) | |||||||||||||||
Net favorable lease assets (b) | 20,921 | ||||||||||||||||
Other | 478 | ||||||||||||||||
62,528 | |||||||||||||||||
Post-closing adjustments on sales of restaurants | (1,587 | ) | |||||||||||||||
Gain on sales of restaurants, net | $ | 60,941 | |||||||||||||||
_______________ | |||||||||||||||||
(a) | Net assets sold consisted primarily of cash, inventory and equipment. | ||||||||||||||||
(b) | The Company recorded favorable lease assets of $43,332 and unfavorable lease liabilities of $22,411 as a result of leasing and/or subleasing land, buildings, and/or leasehold improvements to franchisees, in connection with sales of restaurants. | ||||||||||||||||
As of March 30, 2014, there were no remaining restaurant assets held for sale under the system optimization initiative. | |||||||||||||||||
The table below presents a rollforward of our accrual for the system optimization initiative, which is included in “Accrued expenses and other current liabilities.” | |||||||||||||||||
Balance | Charges | Payments | Balance March 30, | ||||||||||||||
29-Dec-13 | 2014 | ||||||||||||||||
Severance and employee related costs | $ | 7,051 | $ | 5,533 | $ | (5,392 | ) | $ | 7,192 | ||||||||
Professional fees | 137 | 2,631 | (2,330 | ) | 438 | ||||||||||||
Other | 260 | 2,437 | (1,835 | ) | 862 | ||||||||||||
$ | 7,448 | $ | 10,601 | $ | (9,557 | ) | $ | 8,492 | |||||||||
Facilities Relocation and Other Transition Costs | |||||||||||||||||
As announced in December 2011, we commenced the relocation of the Company’s Atlanta restaurant support center to Ohio, which was substantially completed during 2012. The Company incurred $2,170 of expense during the three months ended March 31, 2013 and $39,091 since inception. The Company did not incur any expenses during the three months ended March 31, 2014 and does not expect to incur additional costs related to the relocation. As of March 30, 2014, our accruals for facilities relocation costs, which are included in “Accrued expenses and other current liabilities” and “Other liabilities,” totaled $2,701 and primarily related to Atlanta facility closure costs. | |||||||||||||||||
Breakfast Discontinuation | |||||||||||||||||
During the three months ended March 31, 2013, we reflected $668 of costs resulting from the discontinuation of the breakfast daypart at certain restaurants which primarily consisted of the remaining carrying value of breakfast related equipment no longer being used. The Company does not expect to incur additional costs related to the breakfast discontinuation. |
Acquisitions_and_Dispositions
Acquisitions and Dispositions | 3 Months Ended |
Mar. 30, 2014 | |
Acquisitions and Dispositions [Abstract] | ' |
Acquisitions and Dispositions | ' |
Acquisitions and Dispositions | |
Acquisitions | |
During the three months ended March 31, 2013, Wendy’s acquired one franchised restaurant; such transaction was not significant. | |
Dispositions | |
During the three months ended March 30, 2014, Wendy’s received cash proceeds of $13,466 from dispositions, which were not part of the system optimization initiative, consisting of (1) $6,569 from the sale of four company-owned restaurants to a franchisee, (2) $3,749 primarily from the sale of surplus properties and (3) $3,148 from the sale of a company-owned aircraft. These sales resulted in a net gain of $12,051 which is included in “Other operating (income) expense, net,” and included the effect of (1) favorable lease assets of $4,060 in connection with leasing and/or subleasing the restaurant properties to the franchisee and (2) a reduction to goodwill of $1,015 related to the sale of company-owned restaurants. See Note 2 for discussion of restaurant dispositions in connection with our system optimization initiative. | |
During the three months ended March 31, 2013, Wendy’s received cash proceeds of $2,104 from the sale of surplus properties and other equipment. These sales resulted in a net gain of $564. |
Investments
Investments | 3 Months Ended | |||||||
Mar. 30, 2014 | ||||||||
Investments [Abstract] | ' | |||||||
Investments | ' | |||||||
Investments | ||||||||
Investment in Joint Venture with Tim Hortons Inc. | ||||||||
Wendy’s is a partner in a Canadian restaurant real estate joint venture (“TimWen”) with Tim Hortons Inc. Wendy’s 50% share of the joint venture is accounted for using the equity method of accounting. Our equity in earnings from TimWen is included in “Other operating (income) expense, net.” | ||||||||
Presented below is an unaudited summary of activity related to our investment in TimWen included in our unaudited condensed consolidated financial statements: | ||||||||
Three Months Ended | ||||||||
March 30, | March 31, | |||||||
2014 | 2013 | |||||||
Balance at beginning of period | $ | 79,810 | $ | 89,370 | ||||
Equity in earnings for the period | 2,815 | 3,124 | ||||||
Amortization of purchase price adjustments (a) | (659 | ) | (777 | ) | ||||
2,156 | 2,347 | |||||||
Distributions received | (3,164 | ) | (2,701 | ) | ||||
Foreign currency translation adjustment included in “Other comprehensive loss, net” | (2,548 | ) | (1,877 | ) | ||||
Balance at end of period (b) | $ | 76,254 | $ | 87,139 | ||||
_______________ | ||||||||
(a) | Based upon an average original aggregate life of 21 years. | |||||||
(b) | Included in “Investments.” | |||||||
Presented below is a summary of certain unaudited interim income statement information of TimWen: | ||||||||
Three Months Ended | ||||||||
March 30, | March 31, | |||||||
2014 | 2013 | |||||||
Revenues | $ | 8,292 | $ | 9,024 | ||||
Income before income taxes and net income | 5,630 | 6,247 | ||||||
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | |||||||||||||||||||
Mar. 30, 2014 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||
Fair Value Measurements [Text Block] | ' | |||||||||||||||||||
Fair Value Measurements | ||||||||||||||||||||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques under the accounting guidance related to fair value measurements are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect our market assumptions. These inputs are classified into the following hierarchy: | ||||||||||||||||||||
Level 1 Inputs - Quoted prices for identical assets or liabilities in active markets. | ||||||||||||||||||||
Level 2 Inputs - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. | ||||||||||||||||||||
Level 3 Inputs - Pricing inputs are unobservable for the assets or liabilities and include situations where there is little, if any, market activity for the assets or liabilities. The inputs into the determination of fair value require significant management judgment or estimation. | ||||||||||||||||||||
Financial Instruments | ||||||||||||||||||||
The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments at March 30, 2014 and December 29, 2013: | ||||||||||||||||||||
March 30, | December 29, | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Carrying | Fair | Carrying | Fair | Fair Value | ||||||||||||||||
Amount | Value | Amount | Value | Measurements | ||||||||||||||||
Financial assets | ||||||||||||||||||||
Cash equivalents | $ | 199,957 | $ | 199,957 | $ | 405,874 | $ | 405,874 | Level 1 | |||||||||||
Non-current cost method investments (a) | 3,655 | 106,787 | 3,387 | 130,433 | Level 3 | |||||||||||||||
Cash flow hedges (b) | 467 | 467 | 1,212 | 1,212 | Level 2 | |||||||||||||||
Financial liabilities | ||||||||||||||||||||
Term A Loans, due in 2018 (c) | 563,402 | 562,698 | 570,625 | 569,555 | Level 2 | |||||||||||||||
Term B Loans, due in 2019 (c) | 765,528 | 762,933 | 767,452 | 767,452 | Level 2 | |||||||||||||||
7% debentures, due in 2025 (c) | 84,962 | 102,250 | 84,666 | 98,250 | Level 2 | |||||||||||||||
Capital lease obligations (d) | 47,678 | 48,855 | 40,732 | 38,716 | Level 3 | |||||||||||||||
Guarantees of franchisee loan | 896 | 896 | 884 | 884 | Level 3 | |||||||||||||||
obligations (e) | ||||||||||||||||||||
_______________ | ||||||||||||||||||||
(a) | The fair value of our indirect investment in Arby’s Restaurant Group, Inc. (“Arby’s”) is based on applying a multiple to Arby’s earnings before income taxes, depreciation and amortization per its current unaudited financial information. Refer to the Form 10-K for more information related to the indirect investment in Arby’s and the reduction of the carrying value of our investment to zero during 2013 in connection with the receipt of a dividend. The fair values of our remaining investments were based on our review of information provided by the investment managers or investees which was based on (1) valuations performed by the investment managers or investees, (2) quoted market or broker/dealer prices for similar investments and (3) quoted market or broker/dealer prices adjusted by the investment managers for legal or contractual restrictions, risk of nonperformance or lack of marketability, depending upon the underlying investments. | |||||||||||||||||||
(b) | The fair values were developed using market observable data for all significant inputs. | |||||||||||||||||||
(c) | The fair values were based on quoted market prices in markets that are not considered active markets. | |||||||||||||||||||
(d) | The fair values were determined by discounting the future scheduled principal payments using an interest rate assuming the same original issuance spread over a current U.S. Treasury bond yield for securities with similar durations. | |||||||||||||||||||
(e) | Wendy’s has provided loan guarantees to various lenders on behalf of franchisees entering into debt arrangements for new restaurant development and equipment financing. In addition during 2012, Wendy’s provided a guarantee to a lender for a franchisee in connection with the refinancing of the franchisee’s debt. We have accrued a liability for the fair value of these guarantees, the calculation of which was based upon a weighted average risk percentage established at inception adjusted for a history of defaults. | |||||||||||||||||||
The carrying amounts of cash, accounts payable and accrued expenses approximated fair value due to the short-term nature of those items. The carrying amounts of accounts and notes receivable (both current and non-current) approximated fair value due to the effect of the related allowance for doubtful accounts. Our derivative instruments, cash and cash equivalents and guarantees are the only financial assets and liabilities measured and recorded at fair value on a recurring basis. | ||||||||||||||||||||
Derivative Instruments | ||||||||||||||||||||
The Company’s primary objective for entering into interest rate swap agreements is to manage its exposure to changes in interest rates, as well as to maintain an appropriate mix of fixed and variable rate debt. | ||||||||||||||||||||
Our derivative instruments for the periods presented consist of seven forward starting interest rate swap agreements to change the floating rate interest payments associated with $350,000 and $100,000 in borrowings expected to be outstanding under our Term A Loans and Term B Loans, respectively, to fixed interest rate obligations beginning on June 30, 2015 and maturing on December 31, 2017. At inception, the forward starting swap agreements were designated as cash flow hedges and are evaluated for effectiveness quarterly. | ||||||||||||||||||||
As of March 30, 2014 and December 29, 2013, the fair value of the cash flow hedges of $467 and $1,212, respectively, was included in “Deferred costs and other assets” and as an adjustment to “Accumulated other comprehensive loss.” Through March 30, 2014, no hedge ineffectiveness has occurred relating to these cash flow hedges. | ||||||||||||||||||||
Our derivative instruments for the three months ended March 31, 2013 included interest rate swaps on our 6.20% Senior Notes with notional amounts totaling $225,000 that were all designated as fair value hedges. Interest income on the interest rate swaps was $1,435 for the three months ended March 31, 2013 and there was no ineffectiveness through their termination in October 2013, in connection with the redemption of the 6.20% Senior Notes. | ||||||||||||||||||||
The Company may be exposed to credit losses in the event of nonperformance by the counterparties to its derivative financial instrument contracts. We anticipate that the counterparties will be able to fully satisfy their obligations under the contracts. We do not obtain collateral or other security to support derivative financial instruments subject to credit risk and our interest rate swaps are not cleared through a central clearinghouse; however we do monitor the credit standing of the counterparties. All of the Company’s financial instruments were in an asset position as of March 30, 2014 and therefore presented gross in the condensed consolidated balance sheets. | ||||||||||||||||||||
Non-Recurring Fair Value Measurements | ||||||||||||||||||||
The following tables present the fair values for those assets and liabilities measured at fair value on a non-recurring basis during the three months ended March 30, 2014 and the year ended December 29, 2013 and the resulting impact on the condensed consolidated statements of operations. | ||||||||||||||||||||
Total losses for the three months ended March 30, 2014 and the year ended December 29, 2013 reflect the impact of remeasuring long-lived assets (including land, buildings, leasehold improvements and favorable lease assets) at certain company-owned restaurants to fair value as a result of the Company’s decision to lease and/or sublease the land and/or buildings and sell certain other restaurant assets to franchisees. Such losses totaling $2,197 and $20,506 have been presented as System Optimization Remeasurement and included in “Facilities action (income) charges, net” in our condensed consolidated statement of operations for the three months ended March 30, 2014 and the year ended December 29, 2013, respectively. The fair value of long-lived assets presented in the table below represents the remaining carrying value of the long-lived assets discussed above and was based upon discounted cash flows of future anticipated lease and sublease income. See Note 2 for more information on our system optimization initiative and the related activity included in “Facilities action (income) charges, net” including System Optimization Remeasurement. | ||||||||||||||||||||
Total losses for the three months ended March 30, 2014 also includes $332 from remeasuring land and buildings to fair value in connection with closing company-owned restaurants and classifying such properties as held for sale. Total losses for the year ended December 29, 2013 also include the impact of remeasuring the following to fair value (1) long-lived assets at company-owned restaurants of $9,094, (2) certain surplus properties and properties held for sale of $1,458 and (3) company-owned aircraft of $5,327 as a result of the Company’s decision to sell the aircraft and classify as held for sale. Such losses have been presented as “Impairment of long-lived assets” in our consolidated statements of operations. The fair values of long-lived assets and the aircraft presented in the table below represent the remaining carrying value and were estimated based on current market values. During the first quarter of 2014, one of the aircraft was sold resulting in a gain of $66. | ||||||||||||||||||||
Total losses for the year ended December 29, 2013 also include the impact of remeasuring goodwill associated with our international franchise restaurants reporting unit in connection with our annual goodwill impairment test. Such losses totaling $9,397 represent the total amount of goodwill recorded for our international franchise restaurants reporting unit and were presented as “Impairment of goodwill” in our consolidated statement of operations for the year ended December 29, 2013. | ||||||||||||||||||||
Fair Value Measurements | Three Months Ended | |||||||||||||||||||
30-Mar-14 | ||||||||||||||||||||
March 30, | Level 1 | Level 2 | Level 3 | Total Losses | ||||||||||||||||
2014 | ||||||||||||||||||||
Long-lived assets | $ | 1,486 | $ | — | $ | — | $ | 1,486 | $ | 2,529 | ||||||||||
Total | $ | 1,486 | $ | — | $ | — | $ | 1,486 | $ | 2,529 | ||||||||||
Fair Value Measurements | 2013 | |||||||||||||||||||
December 29, 2013 | Level 1 | Level 2 | Level 3 | Total Losses | ||||||||||||||||
Long-lived assets | $ | 14,788 | $ | — | $ | — | $ | 14,788 | $ | 31,058 | ||||||||||
Goodwill | — | — | — | — | 9,397 | |||||||||||||||
Aircraft | 8,500 | — | — | 8,500 | 5,327 | |||||||||||||||
Total | $ | 23,288 | $ | — | $ | — | $ | 23,288 | $ | 45,782 | ||||||||||
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 30, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
Income Taxes | |
The Company’s effective tax rate and effective tax rate benefit for the three months ended March 30, 2014 and March 31, 2013 was 39.5% and 376.7%, respectively. The Company’s effective tax rate varies from the U.S. federal statutory rate of 35% due to the effect of (1) state income taxes net of federal benefit, (2) the system optimization initiative described in Note 2, (3) foreign rate differential, (4) adjustments related to prior year tax matters and (5) the reversal of deferred tax liabilities during the three months ended March 31, 2013 on temporary differences related to investments in foreign subsidiaries which the Company considers permanently invested outside of the U.S. | |
In January 2014 the Company adopted the Financial Accounting Standards Board (“FASB”) amendment requiring unrecognized tax benefits to be presented as a reduction to deferred tax assets when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. The adoption of this amendment resulted in a reduction of $6,214 in the liability for unrecognized tax benefits and a corresponding increase to net non-current deferred income tax liabilities. Other than the item described above, there were no significant changes to unrecognized tax benefits or related interest and penalties for the Company during the three months ended March 30, 2014 and March 31, 2013. | |
The Company participates in the Internal Revenue Service Compliance Assurance Process. During the first quarter of 2014, we concluded, without adjustment, the examination of our December 30, 2012 tax return. | |
On March 31, 2014, New York enacted a mandatory consolidated return filing requirement. The Company estimates this new requirement will result in a tax provision of approximately $3,200 for the effects of changes to the state deferred tax rate, net of federal benefit, which will be recorded in the second quarter of 2014. |
Net_Income_Per_Share
Net Income Per Share | 3 Months Ended | |||||
Mar. 30, 2014 | ||||||
Earnings Per Share [Abstract] | ' | |||||
Net Income Per Share | ' | |||||
Net Income Per Share | ||||||
Basic net income per share for the three months ended March 30, 2014 and March 31, 2013 was computed by dividing net income amounts by the weighted average number of common shares outstanding. | ||||||
The weighted average number of shares used to calculate basic and diluted net income per share were as follows: | ||||||
Three Months Ended | ||||||
March 30, | March 31, | |||||
2014 | 2013 | |||||
Common stock: | ||||||
Weighted average basic shares outstanding | 381,551 | 392,498 | ||||
Dilutive effect of stock options and restricted shares | 7,801 | 3,196 | ||||
Weighted average diluted shares outstanding | 389,352 | 395,694 | ||||
Diluted net income per share for the three months ended March 30, 2014 and March 31, 2013 was computed by dividing net income by the weighted average number of basic shares outstanding plus the potential common share effect of dilutive stock options and restricted shares. As of March 30, 2014 and March 31, 2013, we excluded 5,855 and 17,831, respectively, of potential common shares from our diluted net income per share calculation as they would have had anti-dilutive effects. |
Equity
Equity | 3 Months Ended | |||||||||||||||
Mar. 30, 2014 | ||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||
Equity | ' | |||||||||||||||
Equity | ||||||||||||||||
Stockholders’ Equity | ||||||||||||||||
The following is a summary of the changes in stockholders’ equity: | ||||||||||||||||
Three Months Ended | ||||||||||||||||
30-Mar-14 | 31-Mar-13 | |||||||||||||||
Balance, beginning of year | $ | 1,929,486 | $ | 1,985,855 | ||||||||||||
Comprehensive income (loss) | 38,963 | (2,998 | ) | |||||||||||||
Dividends | (18,306 | ) | (15,703 | ) | ||||||||||||
Repurchases of common stock | (277,261 | ) | — | |||||||||||||
Share-based compensation | 10,584 | 3,010 | ||||||||||||||
Exercises of stock options | 22,780 | 3,256 | ||||||||||||||
Vesting of restricted shares | (999 | ) | (41 | ) | ||||||||||||
Tax benefit (charge) from share-based compensation | 17,867 | (1,934 | ) | |||||||||||||
Other | 40 | 34 | ||||||||||||||
Balance, end of the period | $ | 1,723,154 | $ | 1,971,479 | ||||||||||||
Repurchases of Common Stock | ||||||||||||||||
In January 2014, our Board of Directors authorized a new repurchase program for up to $275,000 of our common stock through the end of fiscal year 2014, when and if market conditions warrant and to the extent legally permissible. As part of the repurchase program, the Board of Directors also authorized the commencement of a modified Dutch auction tender offer to repurchase shares of our common stock for an aggregate purchase price of up to $275,000. | ||||||||||||||||
On February 11, 2014, the tender offer expired and on February 19, 2014, the Company repurchased 29,730 shares for an aggregate purchase price of $275,000. As a result, the repurchase program authorized in January 2014 has been completed. The Company incurred costs of $2,261 in connection with the tender offer, which were recorded to treasury stock. | ||||||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||||
The following table provides a rollforward of the components of accumulated other comprehensive (loss) income attributable to The Wendy’s Company, net of tax as applicable: | ||||||||||||||||
Foreign Currency Translation | Cash Flow Hedges | Pension | Total | |||||||||||||
Balance at December 29, 2013 | $ | (9,803 | ) | $ | 744 | $ | (1,278 | ) | $ | (10,337 | ) | |||||
Current-period other comprehensive (loss) income | (7,220 | ) | (458 | ) | 338 | (7,340 | ) | |||||||||
Balance at March 30, 2014 | $ | (17,023 | ) | $ | 286 | $ | (940 | ) | $ | (17,677 | ) | |||||
Balance at December 30, 2012 | $ | 7,197 | $ | — | $ | (1,216 | ) | $ | 5,981 | |||||||
Current-period other comprehensive loss | (5,069 | ) | — | (62 | ) | (5,131 | ) | |||||||||
Balance at March 31, 2013 | $ | 2,128 | $ | — | $ | (1,278 | ) | $ | 850 | |||||||
The cumulative gains and losses on these items are included in “Accumulated other comprehensive loss” in the condensed consolidated balance sheets. |
Transactions_with_Related_Part
Transactions with Related Parties | 3 Months Ended |
Mar. 30, 2014 | |
Related Party Transactions [Abstract] | ' |
Transactions with Related Parties | ' |
Transactions with Related Parties | |
Except as described below, the Company did not have any significant changes in or transactions with its related parties during the current fiscal period since those reported in the Form 10-K. | |
Transactions with Purchasing Cooperative | |
Wendy’s received $46 and $49 of lease income from its purchasing cooperative, Quality Supply Chain Co-op, Inc. (“QSCC”) during the three months ended March 30, 2014 and March 31, 2013, respectively, which has been recorded as a reduction of “General and administrative.” | |
Transactions with a Management Company | |
The Wendy’s Company, through a wholly-owned subsidiary, was party to a three-year aircraft management and lease agreement, which expired in March 2014, with CitationAir, a subsidiary of Cessna Aircraft Company, pursuant to which the Company leased a corporate aircraft to CitationAir to use as part of its Jet Card program fleet. The Company entered into the lease agreement as a means of offsetting the cost of owning and operating the corporate aircraft by receiving revenue from third parties’ use of such aircraft. Under the terms of the lease agreement, the Company paid annual management and flight crew fees to CitationAir and reimbursed CitationAir for maintenance costs and fuel usage related to the corporate aircraft. In return, CitationAir paid a negotiated fee to the Company based on the number of hours that the corporate aircraft was used by Jet Card members. This fee was reduced based on the number of hours that (1) the Company used other aircraft in the Jet Card program fleet and (2) Jet Card members who are affiliated with the Company used the corporate aircraft or other aircraft in the Jet Card program fleet. The Company’s participation in the aircraft management and lease agreement reduced the aggregate costs that the Company would otherwise have incurred in connection with owning and operating the corporate aircraft. Under the terms of the lease agreement, the Company’s directors had the opportunity to become Jet Card members and to use aircraft in the Jet Card program fleet at the same negotiated fee paid by the Company as provided for under the lease agreement. During the three months ended March 30, 2014 and March 31, 2013, our Chairman, who was also our former Chief Executive Officer and our Vice Chairman, who was our former President and Chief Operating Officer (the “Former Executives”) and a director, who was our former Vice Chairman, and members of their immediate families, used their Jet Card agreements for business and personal travel on aircraft in the Jet Card program fleet. A management company formed by the Former Executives and a director, who was our former Vice Chairman, paid CitationAir directly, and the Company received credit from CitationAir for charges related to such travel of approximately $375 and $499 during the three months ended March 30, 2014 and March 31, 2013, respectively. | |
TimWen Lease Expense and Management Fees | |
A wholly-owned subsidiary of Wendy’s leases restaurant facilities from TimWen for the operation of Wendy’s/Tim Hortons combo units in Canada. Wendy’s paid TimWen $1,418 and $1,524 under such leases during the three months ended March 30, 2014 and March 31, 2013, respectively, which have been included in “Cost of sales.” In addition, TimWen paid Wendy’s a management fee under the TimWen joint venture agreement, of $62 and $68 during the three months ended March 30, 2014 and March 31, 2013, respectively, which has been included as a reduction to “General and administrative.” | |
Sale of Company-Owned Restaurants to Arizona Restaurant Company, LLC | |
On March 24, 2014, the Company completed the sale of 40 Company-owned restaurants in the Phoenix, Arizona market to Arizona Restaurant Company, LLC (“ARC”) as part of the Company’s system optimization initiative. John N. Peters, who served as the Company’s Senior Vice President – North America Operations until his retirement on March 10, 2014, is a 10% owner and manager of ARC. Pursuant to an Asset Purchase Agreement dated November 20, 2013 and related transaction documents: (1) the Company sold to ARC substantially all of the assets (other than real property) used in the operation of the restaurants for an aggregate purchase price of approximately $21,000 (including inventory, cash banks and franchise and development fees), subject to adjustment as set forth in the agreement; (2) the Company and ARC entered into lease and sublease agreements with respect to the real property and buildings for the restaurants pursuant to which the Company receives aggregate monthly payments from ARC of approximately $300; and (3) ARC agreed to develop five new restaurants and complete Image Activation remodels at seven existing restaurants following the closing. As of March 30, 2014 the Company had accrued $151 for amounts owed to Mr. Peters in accordance with his employment. | |
Other Related Party Transactions | |
As part of its overall retention efforts, The Wendy’s Company provided certain of its Former Executives and current and former employees, the opportunity to co-invest with The Wendy’s Company in certain investments. During 2013, The Wendy’s Company and certain of its former management had one remaining co-investment, 280 BT Holdings LLC (“280 BT”), a limited liability company formed to invest in certain operating entities. In early 2014, 280 BT received a liquidating distribution following the dissolution of its last investment. Upon receipt of the liquidating distribution, 280 BT made a final, equivalent distribution to its members in accordance with the terms of its operating agreement. The ownership percentages in 280 BT for the purpose of the distribution for The Wendy’s Company, the former officers of The Wendy’s Company and other investors were 80.1%, 11.2% and 8.7%, respectively. The distribution during the three months ended March 30, 2014 to The Wendy’s Company and the former officers of The Wendy’s Company was $22 and $5, respectively. 280 BT did not make any distributions to its members in 2013. |
Legal_and_Environmental_Matter
Legal and Environmental Matters | 3 Months Ended |
Mar. 30, 2014 | |
Loss Contingency [Abstract] | ' |
Legal and Environmental Matters | ' |
Legal and Environmental Matters | |
We are involved in litigation and claims incidental to our current and prior businesses. We provide accruals for such litigation and claims when payment is probable and reasonably estimable. As of March 30, 2014, the Company had accruals for all of its legal and environmental matters aggregating $3,573. We cannot estimate the aggregate possible range of loss due to most proceedings being in preliminary stages, with various motions either yet to be submitted or pending, discovery yet to occur, and significant factual matters unresolved. In addition, most cases seek an indeterminate amount of damages and many involve multiple parties. Predicting the outcomes of settlement discussions or judicial or arbitral decisions is thus inherently difficult. Based on currently available information, including legal defenses available to us, and given the aforementioned accruals and our insurance coverage, we do not believe that the outcome of these legal and environmental matters will have a material effect on our consolidated financial position or results of operations. |
Multiemployer_Pension_Plan
Multiemployer Pension Plan | 3 Months Ended |
Mar. 30, 2014 | |
Multiemployer Plans [Abstract] | ' |
Multiemployer Pension Plan | ' |
Multiemployer Pension Plan | |
As further described in the Form 10-K, in December 2013, The New Bakery Company, LLC, a 100% owned subsidiary of Wendy’s, along with its subsidiary The New Bakery of Zanesville, LLC (the “Bakery”), terminated its participation in the Bakery and Confectionery Union and Industry International Pension Fund (the “Union Pension Fund”) and formally notified the plan’s trustees of its withdrawal from the plan. The Union Pension Fund administrator acknowledged the withdrawal, which required Wendy’s to assume an estimated withdrawal liability of $13,500 based on the applicable requirements of the Employee Retirement Income Security Act, as amended, and which was included in “Cost of sales” during the fourth quarter of 2013. The final withdrawal liability will be determined through discussions between the Bakery and the Union Pension Fund administrator and the resolution of a charge filed with the National Labor Relations Board (the “NLRB”) related to the matter brought by the Bakery and Bakers Local No. 57, Bakery, Confectionery, Tobacco Workers & Grain Millers International Union of America, AFL-CIO (the “Union”). On March 31, 2014, the NLRB issued a partial dismissal of the charge, but let stand one of the Union’s allegations. The Bakery believes it has meritorious defenses to the remaining allegation. |
New_Accounting_Standards
New Accounting Standards | 3 Months Ended |
Mar. 30, 2014 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ' |
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | ' |
New Accounting Standards | |
In April 2014, the FASB issued an amendment that modifies the criteria for reporting a discontinued operation. The amendment changes the definition of a discontinued operation including the implementation guidance and requires expanded disclosures. The amendment is effective, prospectively, commencing with our 2015 fiscal year. The Company does not expect the adoption to have a material impact on the consolidated financial statements. |
Facilities_Action_Income_Charg1
Facilities Action (Income) Charges, Net (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 30, 2014 | |||||||||||||||||
Facilities Action (Income) Charges, Net [Line Items] | ' | ||||||||||||||||
Schedule of Facilities Action (Income) Charges, Net [Table Text Block] | ' | ||||||||||||||||
Three Months Ended | |||||||||||||||||
March 30, 2014 | March 31, 2013 | ||||||||||||||||
System optimization initiative | $ | (44,033 | ) | $ | — | ||||||||||||
Facilities relocation and other transition costs | — | 2,170 | |||||||||||||||
Breakfast discontinuation | — | 668 | |||||||||||||||
Arby’s transaction related costs | — | 200 | |||||||||||||||
$ | (44,033 | ) | $ | 3,038 | |||||||||||||
System Optimization [Member] | ' | ||||||||||||||||
Facilities Action (Income) Charges, Net [Line Items] | ' | ||||||||||||||||
Schedule of Facilities Action (Income) Charges, Net [Table Text Block] | ' | ||||||||||||||||
The following is a summary of the activity recorded under our system optimization initiative: | |||||||||||||||||
Three Months Ended | Total Incurred Since Inception | ||||||||||||||||
30-Mar-14 | |||||||||||||||||
Gain on sales of restaurants, net | $ | (60,941 | ) | $ | (107,608 | ) | |||||||||||
System Optimization Remeasurement (a) | 2,197 | 22,703 | |||||||||||||||
Accelerated amortization (b) | 475 | 17,382 | |||||||||||||||
Severance and related employee costs | 5,533 | 15,183 | |||||||||||||||
Share-based compensation (c) | 3,635 | 4,888 | |||||||||||||||
Professional fees | 2,631 | 5,020 | |||||||||||||||
Other | 2,437 | 3,300 | |||||||||||||||
Total system optimization initiative | $ | (44,033 | ) | $ | (39,132 | ) | |||||||||||
_______________ | |||||||||||||||||
(a) | Includes remeasurement of land, buildings, leasehold improvements and favorable lease assets at all company-owned restaurants included in our system optimization initiative. See Note 5 for more information on non-recurring fair value measurements. | ||||||||||||||||
(b) | Includes accelerated amortization of previously acquired franchise rights related to company-owned restaurants in territories that were sold in connection with our system optimization initiative. | ||||||||||||||||
(c) | Represents incremental share-based compensation resulting from the modification of stock options and performance-based awards in connection with the termination of employees under our system optimization initiative. | ||||||||||||||||
Gain (Loss) on Sale of Property, Plant, Equipment [Table Text Block] | ' | ||||||||||||||||
Gain on Sales of Restaurants, Net | |||||||||||||||||
Three Months Ended | |||||||||||||||||
30-Mar-14 | |||||||||||||||||
Number of restaurants sold to franchisees | 174 | ||||||||||||||||
Proceeds from sales of restaurants | $ | 94,991 | |||||||||||||||
Net assets sold (a) | (41,219 | ) | |||||||||||||||
Goodwill related to sales of restaurants | (12,643 | ) | |||||||||||||||
Net favorable lease assets (b) | 20,921 | ||||||||||||||||
Other | 478 | ||||||||||||||||
62,528 | |||||||||||||||||
Post-closing adjustments on sales of restaurants | (1,587 | ) | |||||||||||||||
Gain on sales of restaurants, net | $ | 60,941 | |||||||||||||||
_______________ | |||||||||||||||||
(a) | Net assets sold consisted primarily of cash, inventory and equipment. | ||||||||||||||||
(b) | The Company recorded favorable lease assets of $43,332 and unfavorable lease liabilities of $22,411 as a result of leasing and/or subleasing land, buildings, and/or leasehold improvements to franchisees, in connection with sales of restaurants. | ||||||||||||||||
Facilities Action Charges, Net, Accrual Rollforward [Table Text Block] | ' | ||||||||||||||||
The table below presents a rollforward of our accrual for the system optimization initiative, which is included in “Accrued expenses and other current liabilities.” | |||||||||||||||||
Balance | Charges | Payments | Balance March 30, | ||||||||||||||
29-Dec-13 | 2014 | ||||||||||||||||
Severance and employee related costs | $ | 7,051 | $ | 5,533 | $ | (5,392 | ) | $ | 7,192 | ||||||||
Professional fees | 137 | 2,631 | (2,330 | ) | 438 | ||||||||||||
Other | 260 | 2,437 | (1,835 | ) | 862 | ||||||||||||
$ | 7,448 | $ | 10,601 | $ | (9,557 | ) | $ | 8,492 | |||||||||
Investments_Tables
Investments (Tables) | 3 Months Ended | |||||||
Mar. 30, 2014 | ||||||||
Investments [Abstract] | ' | |||||||
Schedule of Equity Method Investments [Table Text Block] | ' | |||||||
Presented below is an unaudited summary of activity related to our investment in TimWen included in our unaudited condensed consolidated financial statements: | ||||||||
Three Months Ended | ||||||||
March 30, | March 31, | |||||||
2014 | 2013 | |||||||
Balance at beginning of period | $ | 79,810 | $ | 89,370 | ||||
Equity in earnings for the period | 2,815 | 3,124 | ||||||
Amortization of purchase price adjustments (a) | (659 | ) | (777 | ) | ||||
2,156 | 2,347 | |||||||
Distributions received | (3,164 | ) | (2,701 | ) | ||||
Foreign currency translation adjustment included in “Other comprehensive loss, net” | (2,548 | ) | (1,877 | ) | ||||
Balance at end of period (b) | $ | 76,254 | $ | 87,139 | ||||
_______________ | ||||||||
(a) | Based upon an average original aggregate life of 21 years. | |||||||
(b) | Included in “Investments.” | |||||||
Schedule of Summarized Financial Information of Equity Method Investments [Table Text Block] | ' | |||||||
Presented below is a summary of certain unaudited interim income statement information of TimWen: | ||||||||
Three Months Ended | ||||||||
March 30, | March 31, | |||||||
2014 | 2013 | |||||||
Revenues | $ | 8,292 | $ | 9,024 | ||||
Income before income taxes and net income | 5,630 | 6,247 | ||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | |||||||||||||||||||
Mar. 30, 2014 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||
Fair Value, by Balance Sheet Grouping [Table Text Block] | ' | |||||||||||||||||||
The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments at March 30, 2014 and December 29, 2013: | ||||||||||||||||||||
March 30, | December 29, | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Carrying | Fair | Carrying | Fair | Fair Value | ||||||||||||||||
Amount | Value | Amount | Value | Measurements | ||||||||||||||||
Financial assets | ||||||||||||||||||||
Cash equivalents | $ | 199,957 | $ | 199,957 | $ | 405,874 | $ | 405,874 | Level 1 | |||||||||||
Non-current cost method investments (a) | 3,655 | 106,787 | 3,387 | 130,433 | Level 3 | |||||||||||||||
Cash flow hedges (b) | 467 | 467 | 1,212 | 1,212 | Level 2 | |||||||||||||||
Financial liabilities | ||||||||||||||||||||
Term A Loans, due in 2018 (c) | 563,402 | 562,698 | 570,625 | 569,555 | Level 2 | |||||||||||||||
Term B Loans, due in 2019 (c) | 765,528 | 762,933 | 767,452 | 767,452 | Level 2 | |||||||||||||||
7% debentures, due in 2025 (c) | 84,962 | 102,250 | 84,666 | 98,250 | Level 2 | |||||||||||||||
Capital lease obligations (d) | 47,678 | 48,855 | 40,732 | 38,716 | Level 3 | |||||||||||||||
Guarantees of franchisee loan | 896 | 896 | 884 | 884 | Level 3 | |||||||||||||||
obligations (e) | ||||||||||||||||||||
_______________ | ||||||||||||||||||||
(a) | The fair value of our indirect investment in Arby’s Restaurant Group, Inc. (“Arby’s”) is based on applying a multiple to Arby’s earnings before income taxes, depreciation and amortization per its current unaudited financial information. Refer to the Form 10-K for more information related to the indirect investment in Arby’s and the reduction of the carrying value of our investment to zero during 2013 in connection with the receipt of a dividend. The fair values of our remaining investments were based on our review of information provided by the investment managers or investees which was based on (1) valuations performed by the investment managers or investees, (2) quoted market or broker/dealer prices for similar investments and (3) quoted market or broker/dealer prices adjusted by the investment managers for legal or contractual restrictions, risk of nonperformance or lack of marketability, depending upon the underlying investments. | |||||||||||||||||||
(b) | The fair values were developed using market observable data for all significant inputs. | |||||||||||||||||||
(c) | The fair values were based on quoted market prices in markets that are not considered active markets. | |||||||||||||||||||
(d) | The fair values were determined by discounting the future scheduled principal payments using an interest rate assuming the same original issuance spread over a current U.S. Treasury bond yield for securities with similar durations. | |||||||||||||||||||
(e) | Wendy’s has provided loan guarantees to various lenders on behalf of franchisees entering into debt arrangements for new restaurant development and equipment financing. In addition during 2012, Wendy’s provided a guarantee to a lender for a franchisee in connection with the refinancing of the franchisee’s debt. We have accrued a liability for the fair value of these guarantees, the calculation of which was based upon a weighted average risk percentage established at inception adjusted for a history of defaults. | |||||||||||||||||||
Fair Value Measurements, Nonrecurring [Table Text Block] | ' | |||||||||||||||||||
The following tables present the fair values for those assets and liabilities measured at fair value on a non-recurring basis during the three months ended March 30, 2014 and the year ended December 29, 2013 and the resulting impact on the condensed consolidated statements of operations. | ||||||||||||||||||||
Total losses for the three months ended March 30, 2014 and the year ended December 29, 2013 reflect the impact of remeasuring long-lived assets (including land, buildings, leasehold improvements and favorable lease assets) at certain company-owned restaurants to fair value as a result of the Company’s decision to lease and/or sublease the land and/or buildings and sell certain other restaurant assets to franchisees. Such losses totaling $2,197 and $20,506 have been presented as System Optimization Remeasurement and included in “Facilities action (income) charges, net” in our condensed consolidated statement of operations for the three months ended March 30, 2014 and the year ended December 29, 2013, respectively. The fair value of long-lived assets presented in the table below represents the remaining carrying value of the long-lived assets discussed above and was based upon discounted cash flows of future anticipated lease and sublease income. See Note 2 for more information on our system optimization initiative and the related activity included in “Facilities action (income) charges, net” including System Optimization Remeasurement. | ||||||||||||||||||||
Total losses for the three months ended March 30, 2014 also includes $332 from remeasuring land and buildings to fair value in connection with closing company-owned restaurants and classifying such properties as held for sale. Total losses for the year ended December 29, 2013 also include the impact of remeasuring the following to fair value (1) long-lived assets at company-owned restaurants of $9,094, (2) certain surplus properties and properties held for sale of $1,458 and (3) company-owned aircraft of $5,327 as a result of the Company’s decision to sell the aircraft and classify as held for sale. Such losses have been presented as “Impairment of long-lived assets” in our consolidated statements of operations. The fair values of long-lived assets and the aircraft presented in the table below represent the remaining carrying value and were estimated based on current market values. During the first quarter of 2014, one of the aircraft was sold resulting in a gain of $66. | ||||||||||||||||||||
Total losses for the year ended December 29, 2013 also include the impact of remeasuring goodwill associated with our international franchise restaurants reporting unit in connection with our annual goodwill impairment test. Such losses totaling $9,397 represent the total amount of goodwill recorded for our international franchise restaurants reporting unit and were presented as “Impairment of goodwill” in our consolidated statement of operations for the year ended December 29, 2013. | ||||||||||||||||||||
Fair Value Measurements | Three Months Ended | |||||||||||||||||||
30-Mar-14 | ||||||||||||||||||||
March 30, | Level 1 | Level 2 | Level 3 | Total Losses | ||||||||||||||||
2014 | ||||||||||||||||||||
Long-lived assets | $ | 1,486 | $ | — | $ | — | $ | 1,486 | $ | 2,529 | ||||||||||
Total | $ | 1,486 | $ | — | $ | — | $ | 1,486 | $ | 2,529 | ||||||||||
Fair Value Measurements | 2013 | |||||||||||||||||||
December 29, 2013 | Level 1 | Level 2 | Level 3 | Total Losses | ||||||||||||||||
Long-lived assets | $ | 14,788 | $ | — | $ | — | $ | 14,788 | $ | 31,058 | ||||||||||
Goodwill | — | — | — | — | 9,397 | |||||||||||||||
Aircraft | 8,500 | — | — | 8,500 | 5,327 | |||||||||||||||
Total | $ | 23,288 | $ | — | $ | — | $ | 23,288 | $ | 45,782 | ||||||||||
Net_Income_Per_Share_Tables
Net Income Per Share (Tables) | 3 Months Ended | |||||
Mar. 30, 2014 | ||||||
Earnings Per Share [Abstract] | ' | |||||
Weighted average number of shares used to calculate basic and diluted net income per share | ' | |||||
The weighted average number of shares used to calculate basic and diluted net income per share were as follows: | ||||||
Three Months Ended | ||||||
March 30, | March 31, | |||||
2014 | 2013 | |||||
Common stock: | ||||||
Weighted average basic shares outstanding | 381,551 | 392,498 | ||||
Dilutive effect of stock options and restricted shares | 7,801 | 3,196 | ||||
Weighted average diluted shares outstanding | 389,352 | 395,694 | ||||
Equity_Tables
Equity (Tables) | 3 Months Ended | |||||||||||||||
Mar. 30, 2014 | ||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||
Summary of Stockholders' Equity | ' | |||||||||||||||
The following is a summary of the changes in stockholders’ equity: | ||||||||||||||||
Three Months Ended | ||||||||||||||||
30-Mar-14 | 31-Mar-13 | |||||||||||||||
Balance, beginning of year | $ | 1,929,486 | $ | 1,985,855 | ||||||||||||
Comprehensive income (loss) | 38,963 | (2,998 | ) | |||||||||||||
Dividends | (18,306 | ) | (15,703 | ) | ||||||||||||
Repurchases of common stock | (277,261 | ) | — | |||||||||||||
Share-based compensation | 10,584 | 3,010 | ||||||||||||||
Exercises of stock options | 22,780 | 3,256 | ||||||||||||||
Vesting of restricted shares | (999 | ) | (41 | ) | ||||||||||||
Tax benefit (charge) from share-based compensation | 17,867 | (1,934 | ) | |||||||||||||
Other | 40 | 34 | ||||||||||||||
Balance, end of the period | $ | 1,723,154 | $ | 1,971,479 | ||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | ' | |||||||||||||||
The following table provides a rollforward of the components of accumulated other comprehensive (loss) income attributable to The Wendy’s Company, net of tax as applicable: | ||||||||||||||||
Foreign Currency Translation | Cash Flow Hedges | Pension | Total | |||||||||||||
Balance at December 29, 2013 | $ | (9,803 | ) | $ | 744 | $ | (1,278 | ) | $ | (10,337 | ) | |||||
Current-period other comprehensive (loss) income | (7,220 | ) | (458 | ) | 338 | (7,340 | ) | |||||||||
Balance at March 30, 2014 | $ | (17,023 | ) | $ | 286 | $ | (940 | ) | $ | (17,677 | ) | |||||
Balance at December 30, 2012 | $ | 7,197 | $ | — | $ | (1,216 | ) | $ | 5,981 | |||||||
Current-period other comprehensive loss | (5,069 | ) | — | (62 | ) | (5,131 | ) | |||||||||
Balance at March 31, 2013 | $ | 2,128 | $ | — | $ | (1,278 | ) | $ | 850 | |||||||
Basis_of_Presentation_Accelera
Basis of Presentation Accelerated Depreciation on Image Activation (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Accelerated Depreciation IA [Abstract] | ' | ' |
Accelerated Depreciation Image Activation | $9,558 | $14,508 |
Facilities_Action_Income_Charg2
Facilities Action (Income) Charges, Net Summary Table (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' |
Facilities action (income) charges, net | ($44,033) | $3,038 |
System Optimization [Member] | ' | ' |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' |
Facilities action (income) charges, net | -44,033 | 0 |
Facilities Relocation and Other Transition Costs [Member] | ' | ' |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' |
Facilities action (income) charges, net | 0 | 2,170 |
Breakfast Discontinuation [Member] | ' | ' |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' |
Facilities action (income) charges, net | 0 | 668 |
Arby's Transaction Related Costs [Member] | ' | ' |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' |
Facilities action (income) charges, net | $0 | $200 |
Facilities_Action_Income_Charg3
Facilities Action (Income) Charges, Net System Optimization Costs (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 | Mar. 30, 2014 | ||
stores | stores | ||||
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' | ||
Gain on sales of restaurants, net | ($60,941) | $0 | ' | ||
System Optimization Remeasurement | 2,197 | 0 | ' | ||
Facilities action (income) charges, net | -44,033 | 3,038 | ' | ||
System Optimization [Member] | ' | ' | ' | ||
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' | ||
Significant Changes, Franchises Sold | 174 | ' | ' | ||
Significant Changes, Franchises Sold, Incurred to Date | ' | ' | 418 | ||
Gain on sales of restaurants, net | -60,941 | ' | ' | ||
System Optimization Remeasurement | 2,197 | [1] | ' | ' | |
Restructuring and related cost, Incurred cost | 10,601 | ' | ' | ||
Facilities action (income) charges, net | -44,033 | 0 | ' | ||
Gain on sales of restaurants, net, costs incurred since inception | ' | ' | -107,608 | ||
System Optimization Remeasurement, Cost incurred to date | ' | ' | 22,703 | [1] | |
Restructuring and related cost, Cost incurred to date | ' | ' | -39,132 | ||
System Optimization [Member] | Accelerated Depreciation Expense [Member] | ' | ' | ' | ||
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' | ||
Restructuring and related cost, Incurred cost | 475 | [2] | ' | ' | |
Restructuring and related cost, Cost incurred to date | ' | ' | 17,382 | [2] | |
System Optimization [Member] | Severance, Retention and Other Payroll Costs [Member] | ' | ' | ' | ||
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' | ||
Restructuring and related cost, Incurred cost | 5,533 | ' | ' | ||
Restructuring and related cost, Cost incurred to date | ' | ' | 15,183 | ||
System Optimization [Member] | Share Based Compensation Expense [Member] | ' | ' | ' | ||
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' | ||
Restructuring and related cost, Incurred cost | 3,635 | [3] | ' | ' | |
Restructuring and related cost, Cost incurred to date | ' | ' | 4,888 | [3] | |
System Optimization [Member] | Consulting and Professional Fees [Member] | ' | ' | ' | ||
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' | ||
Restructuring and related cost, Incurred cost | 2,631 | ' | ' | ||
Restructuring and related cost, Cost incurred to date | ' | ' | 5,020 | ||
System Optimization [Member] | Other [Member] | ' | ' | ' | ||
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' | ||
Restructuring and related cost, Incurred cost | 2,437 | ' | ' | ||
Restructuring and related cost, Cost incurred to date | ' | ' | $3,300 | ||
[1] | Includes remeasurement of land, buildings, leasehold improvements and favorable lease assets at all company-owned restaurants included in our system optimization initiative. See Note 5 for more information on non-recurring fair value measurements. | ||||
[2] | Includes accelerated amortization of previously acquired franchise rights related to company-owned restaurants in territories that were sold in connection with our system optimization initiative. | ||||
[3] | Represents incremental share-based compensation resulting from the modification of stock options and performance-based awards in connection with the termination of employees under our system optimization initiative. |
Facilities_Action_Income_Charg4
Facilities Action (Income) Charges, Net System Optimization Gain (Loss) on Sales of Restaurants (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 | |
Significant Acquisitions and Disposals [Line Items] | ' | ' | |
Proceeds from sales of restaurants | $13,466 | ' | |
Gain on sales of restaurants, net | 60,941 | 0 | |
System Optimization [Member] | ' | ' | |
Significant Acquisitions and Disposals [Line Items] | ' | ' | |
Number of restaurants sold to franchisees | 174 | ' | |
Proceeds from sales of restaurants | 94,991 | ' | |
Net assets sold | -41,219 | [1] | ' |
Goodwill related to sales of restaurants | -12,643 | ' | |
Net favorable lease assets | 20,921 | [2] | ' |
Other | 478 | ' | |
Gain (loss) on sales of Property Plant Equipment before post-closing adjustments | 62,528 | ' | |
Post-closing adjustments on sales of restaurants | -1,587 | ' | |
Gain on sales of restaurants, net | 60,941 | ' | |
Favorable Lease Assets | 43,332 | ' | |
Unfavorable Lease Liabilities | -22,411 | ' | |
Assets Held-for-sale, Long Lived | $0 | ' | |
[1] | Net assets sold consisted primarily of cash, inventory and equipment. | ||
[2] | The Company recorded favorable lease assets of $43,332 and unfavorable lease liabilities of $22,411 as a result of leasing and/or subleasing land, buildings, and/or leasehold improvements to franchisees, in connection with sales of restaurants. |
Facilities_Action_Income_Charg5
Facilities Action (Income) Charges, Net System Optimization Accrual Rollforward (Details) (System Optimization [Member], USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 30, 2014 |
Restructuring Cost and Reserve [Line Items] | ' |
Beginning balance | $7,448 |
Charges | 10,601 |
Payments | -9,557 |
Ending balance | 8,492 |
Severance, Retention and Other Payroll Costs [Member] | ' |
Restructuring Cost and Reserve [Line Items] | ' |
Beginning balance | 7,051 |
Charges | 5,533 |
Payments | -5,392 |
Ending balance | 7,192 |
Consulting and Professional Fees [Member] | ' |
Restructuring Cost and Reserve [Line Items] | ' |
Beginning balance | 137 |
Charges | 2,631 |
Payments | -2,330 |
Ending balance | 438 |
Other [Member] | ' |
Restructuring Cost and Reserve [Line Items] | ' |
Beginning balance | 260 |
Charges | 2,437 |
Payments | -1,835 |
Ending balance | $862 |
Facilities_Action_Income_Charg6
Facilities Action (Income) Charges, Net Facilities Relocation and Other Transition Costs (Details) (USD $) | 3 Months Ended | 28 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 | Mar. 30, 2014 |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' |
Facilities action (income) charges, net | ($44,033) | $3,038 | ' |
Facilities Relocation and Other Transition Costs [Member] | ' | ' | ' |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' | ' |
Facilities action (income) charges, net | 0 | 2,170 | ' |
Restructuring and related cost, Cost incurred to date | ' | ' | 39,091 |
Restructuring Reserve | 2,701 | ' | 2,701 |
Restructuring and related cost, Expected cost | $0 | ' | ' |
Facilities_Action_Income_Charg7
Facilities Action (Income) Charges, Net Breakfast Discontinuation Costs (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' |
Facilities action (income) charges, net | ($44,033) | $3,038 |
Breakfast Discontinuation [Member] | ' | ' |
Facilities Action (Income) Charges, Net [Line Items] | ' | ' |
Facilities action (income) charges, net | 0 | 668 |
Restructuring and related cost, Expected cost | $0 | ' |
Acquisitions_and_Dispositions_
Acquisitions and Dispositions (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Significant Acquisitions and Disposals [Line Items] | ' | ' |
Proceeds from Sale of Property, Plant, and Equipment | $13,466 | ' |
Gain (loss) on disposition of property plant equipment | 12,051 | 564 |
Franchised Units [Member] | ' | ' |
Significant Acquisitions and Disposals [Line Items] | ' | ' |
Significant Changes, Franchises Purchased During Period | ' | 1 |
Sale of Company-Owned Restaurants to Franchisees [Member] | ' | ' |
Significant Acquisitions and Disposals [Line Items] | ' | ' |
Proceeds from Sale of Property, Plant, and Equipment | 6,569 | ' |
Significant Changes, Franchises Sold | 4 | ' |
Favorable Lease Assets | 4,060 | ' |
Goodwill, Period Increase (Decrease) | -1,015 | ' |
Surplus Properties [Member] | ' | ' |
Significant Acquisitions and Disposals [Line Items] | ' | ' |
Proceeds from Sale of Property, Plant, and Equipment | 3,749 | 2,104 |
Corporate Aircraft [Member] | ' | ' |
Significant Acquisitions and Disposals [Line Items] | ' | ' |
Proceeds from Sale of Property, Plant, and Equipment | $3,148 | ' |
Investments_TIMWEN_Details
Investments TIMWEN (Details) (USD $) | 3 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 | Sep. 30, 2008 | ||
Y | |||||
Investment in Joint Venture [Roll Forward] | ' | ' | ' | ||
Equity in earnings for the period, net of amortization of purchase price adjustment | $2,156 | $1,191 | ' | ||
Distributions received | -3,164 | -2,701 | ' | ||
Foreign currency translation adjustment included in “Other comprehensive loss, net†| -7,220 | -5,069 | ' | ||
TimWen [Member] | ' | ' | ' | ||
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ||
Equity Method Investment, Ownership Percentage | 50.00% | ' | ' | ||
Investment in Joint Venture [Roll Forward] | ' | ' | ' | ||
Balance at beginning of period | 79,810 | 89,370 | ' | ||
Equity in earnings for the period | 2,815 | 3,124 | ' | ||
Amortization of purchase price adjustments (a) | -659 | [1] | -777 | [1] | ' |
Equity in earnings for the period, net of amortization of purchase price adjustment | 2,156 | 2,347 | ' | ||
Distributions received | -3,164 | -2,701 | ' | ||
Foreign currency translation adjustment included in “Other comprehensive loss, net†| -2,548 | -1,877 | ' | ||
Balance at end of period (b) | 76,254 | [2] | 87,139 | [2] | ' |
Purchase price adjustment, amortization period | ' | ' | 21 | ||
Equity Method Investment, Summarized Financial Information [Abstract] | ' | ' | ' | ||
Revenues | 8,292 | 9,024 | ' | ||
Income before income taxes and net income | $5,630 | $6,247 | ' | ||
[1] | Based upon an average original aggregate life of 21 years. | ||||
[2] | Included in “Investments.†|
Fair_Value_Measurements_Financ
Fair Value Measurements Financial Instruments (Details) (USD $) | Mar. 30, 2014 | Dec. 29, 2013 | ||
In Thousands, unless otherwise specified | ||||
Reported Value Measurement [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Cash equivalents | $199,957 | $405,874 | ||
Non-current cost method investments | 3,655 | 3,387 | ||
Cash flow hedges | 467 | [1] | 1,212 | [1] |
Guarantees of franchisee loan obligations | 896 | [2] | 884 | [2] |
Estimate of Fair Value Measurement | Fair Value, Inputs, Level 1 [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Cash equivalents | 199,957 | 405,874 | ||
Estimate of Fair Value Measurement | Fair Value, Inputs, Level 3 [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Non-current cost method investments | 106,787 | [3] | 130,433 | [3] |
Guarantees of franchisee loan obligations | 896 | [2] | 884 | [2] |
Estimate of Fair Value Measurement | Fair Value, Inputs, Level 2 [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Cash flow hedges | 467 | [1] | 1,212 | [1] |
Term A Loan, 2018 [Member] | Reported Value Measurement [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | 563,402 | 570,625 | ||
Term A Loan, 2018 [Member] | Estimate of Fair Value Measurement | Fair Value, Inputs, Level 2 [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | 562,698 | [4] | 569,555 | [4] |
Term B Loan, 2019 [Member] | Reported Value Measurement [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | 765,528 | 767,452 | ||
Term B Loan, 2019 [Member] | Estimate of Fair Value Measurement | Fair Value, Inputs, Level 2 [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | 762,933 | [4] | 767,452 | [4] |
7% Debentures [Member] | Reported Value Measurement [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | 84,962 | 84,666 | ||
7% Debentures [Member] | Estimate of Fair Value Measurement | Fair Value, Inputs, Level 2 [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | 102,250 | [4] | 98,250 | [4] |
Capital Lease Obligations [Member] | Reported Value Measurement [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | 47,678 | 40,732 | ||
Capital Lease Obligations [Member] | Estimate of Fair Value Measurement | Fair Value, Inputs, Level 3 [Member] | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ||
Debt instrument | $48,855 | [5] | $38,716 | [5] |
[1] | The fair values were developed using market observable data for all significant inputs. | |||
[2] | Wendy’s has provided loan guarantees to various lenders on behalf of franchisees entering into debt arrangements for new restaurant development and equipment financing. In addition during 2012, Wendy’s provided a guarantee to a lender for a franchisee in connection with the refinancing of the franchisee’s debt. We have accrued a liability for the fair value of these guarantees, the calculation of which was based upon a weighted average risk percentage established at inception adjusted for a history of defaults. | |||
[3] | The fair value of our indirect investment in Arby’s Restaurant Group, Inc. (“Arby’sâ€) is based on applying a multiple to Arby’s earnings before income taxes, depreciation and amortization per its current unaudited financial information. Refer to the Form 10-K for more information related to the indirect investment in Arby’s and the reduction of the carrying value of our investment to zero during 2013 in connection with the receipt of a dividend. The fair values of our remaining investments were based on our review of information provided by the investment managers or investees which was based on (1) valuations performed by the investment managers or investees, (2) quoted market or broker/dealer prices for similar investments and (3) quoted market or broker/dealer prices adjusted by the investment managers for legal or contractual restrictions, risk of nonperformance or lack of marketability, depending upon the underlying investments. | |||
[4] | The fair values were based on quoted market prices in markets that are not considered active markets. | |||
[5] | The fair values were determined by discounting the future scheduled principal payments using an interest rate assuming the same original issuance spread over a current U.S. Treasury bond yield for securities with similar durations. |
Fair_Value_Measurements_Deriva
Fair Value Measurements Derivative Instruments (Details) (USD $) | 3 Months Ended | 10 Months Ended | 3 Months Ended | |||||||
In Thousands, unless otherwise specified | Mar. 30, 2014 | Oct. 24, 2013 | Mar. 30, 2014 | Dec. 29, 2013 | Mar. 30, 2014 | Mar. 30, 2014 | Sep. 30, 2008 | Mar. 31, 2013 | ||
cash_flow_hedge | Deferred Costs and Other Assets [Member] | Deferred Costs and Other Assets [Member] | Term A Loan, 2018 [Member] | Term B Loan, 2019 [Member] | Term Loan, 2012 [Member] | Term Loan, 2012 [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Interest Rate Swap [Member] | Interest Rate Swap [Member] | Interest Rate Swap [Member] | ||||||
Swap [Member] | Swap [Member] | |||||||||
Derivatives, Fair Value [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Number of interest rate derivatives held | 7 | ' | ' | ' | ' | ' | ' | ' | ||
Derivative, Notional amount | ' | ' | ' | ' | $350,000 | $100,000 | ' | $225,000 | ||
Cash flow hedges | ' | ' | 467 | [1] | 1,212 | [1] | ' | ' | ' | ' |
Gain (loss) on cash flow hedge ineffectiveness, net | 0 | 0 | ' | ' | ' | ' | ' | ' | ||
Debt Instrument, Interest Rate, Stated Percentage | ' | ' | ' | ' | ' | ' | 6.20% | ' | ||
Other Interest and Dividend Income | ' | ' | ' | ' | ' | ' | ' | $1,435 | ||
[1] | The fair values were developed using market observable data for all significant inputs. |
Fair_Value_Measurements_NonRec
Fair Value Measurements Non-Recurring Fair Value Measurements (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 | Dec. 29, 2013 | |
Aircraft | ||||
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Asset impairment charges, Nonrecurring | $2,529 | ' | $45,782 | |
Property, Plant and Equipment, Number of Aircraft Sold | 1 | ' | ' | |
Impairment of goodwill | ' | ' | 9,397 | |
Impairment of long-lived assets | 332 | 0 | ' | |
Gain (loss) on disposition of property plant equipment | 12,051 | 564 | ' | |
Impairment of long-lived assets | 2,529 | ' | 31,058 | |
System Optimization Remeasurement | 2,197 | 0 | ' | |
System Optimization [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
System Optimization Remeasurement | 2,197 | [1] | ' | ' |
System Optimization [Member] | Facilities action (income) charges, net [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
System Optimization Remeasurement | 2,197 | ' | 20,506 | |
Corporate Aircraft [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Gain (loss) on disposition of property plant equipment | 66 | ' | ' | |
Corporate Aircraft [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Impairment of long-lived assets | ' | ' | 5,327 | |
Properties and Other Intangible Assets, Surplus Properties and Non-SO Held-for-sale [Member] [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Impairment of long-lived assets | 332 | ' | 1,458 | |
Properties and Other Intangible Assets, Operating Restaurants [Member] [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Impairment of long-lived assets | ' | ' | 9,094 | |
Fair Value, Measurements, Nonrecurring [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Total assets, Fair value disclosure | 1,486 | ' | 23,288 | |
Fair Value, Measurements, Nonrecurring [Member] | Properties and Other Intangible Assets [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | 1,486 | ' | 14,788 | |
Fair Value, Measurements, Nonrecurring [Member] | Goodwill [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Goodwill | ' | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Corporate Aircraft [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | ' | ' | 8,500 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Total assets, Fair value disclosure | 0 | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member] | Properties and Other Intangible Assets [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | 0 | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member] | Goodwill [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Goodwill | ' | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member] | Corporate Aircraft [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | ' | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Total assets, Fair value disclosure | 0 | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member] | Properties and Other Intangible Assets [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | 0 | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member] | Goodwill [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Goodwill | ' | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member] | Corporate Aircraft [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | ' | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Total assets, Fair value disclosure | 1,486 | ' | 23,288 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Properties and Other Intangible Assets [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | 1,486 | ' | 14,788 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Goodwill [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Goodwill | ' | ' | 0 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Corporate Aircraft [Member] | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items] | ' | ' | ' | |
Long-lived assets | ' | ' | $8,500 | |
[1] | Includes remeasurement of land, buildings, leasehold improvements and favorable lease assets at all company-owned restaurants included in our system optimization initiative. See Note 5 for more information on non-recurring fair value measurements. |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Income Tax Disclosure [Abstract] | ' | ' |
Effective Income Tax Rate, Continuing Operations | 39.50% | 376.70% |
New Accounting Pronouncement, Increase (Decrease) in Non-Current Deferred Income Tax Liability | $6,214 | ' |
Subsequent Event, Estimate of Future Tax Provision due to Statutory Change | $3,200 | ' |
Net_Income_Per_Share_Details
Net Income Per Share (Details) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Earnings Per Share [Abstract] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount Outstanding | 5,855 | 17,831 |
Common Stock: | ' | ' |
Weighted average basic shares outstanding | 381,551 | 392,498 |
Dilutive effect of stock options and restricted shares | 7,801 | 3,196 |
Weighted average diluted shares outstanding | 389,352 | 395,694 |
Equity_Rollforward_Details
Equity Rollforward (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Balance, beginning of year | $1,929,486 | $1,985,855 |
Comprehensive Income (Loss) | 38,963 | -2,998 |
Dividends | -18,306 | -15,703 |
Repurchases of common stock | -277,261 | 0 |
Share-based compensation | 10,584 | 3,010 |
Exercises of stock options | 22,780 | 3,256 |
Vesting of restricted shares | -999 | -41 |
Tax benefit (charge) from share-based compensation | 17,867 | -1,934 |
Other | 40 | 34 |
Balance, end of the period | $1,723,154 | $1,971,479 |
Equity_Repurchases_of_Common_S
Equity Repurchases of Common Stock (Details) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 30, 2014 |
Stock Repurchase Program, Authorized Amount | $275,000 |
Treasury Stock, Shares, Acquired | 29,730 |
Stock Repurchase Program, Aggregate Purchase Price | 275,000 |
Stock Repurchase Program, Cost Incurred | $2,261 |
Equity_Accumulated_Other_Compr
Equity Accumulated Other Comprehensive (Loss) Income (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 30, 2014 | Mar. 31, 2013 |
Balance, beginning of year | ($10,337) | $5,981 |
Other Comprehensive Income (Loss), Net of Tax | -7,340 | -5,131 |
Balance, end of the period | -17,677 | 850 |
Foreign Currency Translation | ' | ' |
Balance, beginning of year | -9,803 | 7,197 |
Other Comprehensive Income (Loss), Net of Tax | -7,220 | -5,069 |
Balance, end of the period | -17,023 | 2,128 |
Cash Flow Hedges | ' | ' |
Balance, beginning of year | 744 | 0 |
Other Comprehensive Income (Loss), Net of Tax | -458 | 0 |
Balance, end of the period | 286 | 0 |
Pension | ' | ' |
Balance, beginning of year | -1,278 | -1,216 |
Other Comprehensive Income (Loss), Net of Tax | 338 | -62 |
Balance, end of the period | ($940) | ($1,278) |
Transactions_with_Related_Part1
Transactions with Related Parties (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | 3 Months Ended | |||||||||||
In Thousands, unless otherwise specified | Mar. 31, 2013 | Mar. 30, 2014 | Mar. 31, 2013 | Mar. 30, 2014 | Mar. 31, 2013 | Mar. 30, 2014 | Mar. 31, 2013 | Mar. 30, 2014 | Mar. 31, 2013 | Mar. 30, 2014 | Dec. 29, 2013 | Mar. 30, 2014 | Mar. 30, 2014 | Mar. 30, 2014 | Mar. 30, 2014 |
QSCC [Member] | QSCC [Member] | Former Management [Member] | Former Management [Member] | TimWen [Member] | TimWen [Member] | TimWen [Member] | TimWen [Member] | ARC [Member] | 280 BT [Member] | 280 BT [Member] | 280 BT - Former Management of The Wendy's Company [Member] | 280 BT, Investors [Member] | Wendy's [Member] | ||
General and Administrative Expense [Member] | General and Administrative Expense [Member] | General and Administrative Expense [Member] | General and Administrative Expense [Member] | Cost of Sales [Member] | Cost of Sales [Member] | stores | investment | ||||||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sublease Income, Related Party | ' | $46 | $49 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit for aircraft fees paid by related party | ' | ' | ' | 375 | 499 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related Party Transactions, TimWen Lease Expenses Paid | ' | ' | ' | ' | ' | ' | ' | 1,418 | 1,524 | ' | ' | ' | ' | ' | ' |
Related Party Transactions, Management Fee Income Received | ' | ' | ' | ' | ' | 62 | 68 | ' | ' | ' | ' | ' | ' | ' | ' |
Significant Changes, Franchises Sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | 40 | ' | ' | ' | ' | ' |
Related party ownership percentage of franchisee | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' |
Related Party Transaction, Purchase Price of Assets Sold to Related Party | ' | ' | ' | ' | ' | ' | ' | ' | ' | 21,000 | ' | ' | ' | ' | ' |
Contractual Revenue from Related Party Transaction, Monthly | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300 | ' | ' | ' | ' | ' |
Number of restaurants to be developed | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | ' |
Number of restaurants expected to be Image Activated | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7 | ' | ' | ' | ' | ' |
Due to Related Parties, Current | ' | ' | ' | ' | ' | ' | ' | ' | ' | 151 | ' | ' | ' | ' | ' |
Related Party Transactions, Number of Remaining Co-Investments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' |
Investment Subsidiary, Ownership Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80.10% | 11.20% | 8.70% | ' |
Related Party Transaction, Distribution from Related Party Investment | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $5 | ' | $22 |
Legal_and_Environmental_Matter1
Legal and Environmental Matters (Details) (Legal and Environmental Matters [Member], USD $) | Mar. 30, 2014 |
In Thousands, unless otherwise specified | |
Legal and Environmental Matters [Member] | ' |
Loss Contingencies [Line Items] | ' |
Accruals for legal and environmental matters | $3,573 |
Multiemployer_Pension_Plan_Mul
Multiemployer Pension Plan Multiemployer Plans (Details) (Cost of Sales [Member], USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Dec. 29, 2013 |
Cost of Sales [Member] | ' |
Multiemployer Plans [Line Items] | ' |
Multiemployer Plans, Withdrawal Obligation Recognized | $13,500 |