Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Billions, except Share data, unless otherwise specified | Dec. 31, 2014 | Feb. 20, 2015 | Jun. 30, 2014 |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | DineEquity, Inc. | ||
Entity Central Index Key | 49754 | ||
Current Fiscal Year End Date | -19 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | FALSE | ||
Entity Common Stock, Shares Outstanding | 19,119,025 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $1.30 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $104,004 | $106,011 |
Receivables, net | 153,498 | 144,137 |
Restricted cash | 52,262 | 664 |
Prepaid gift cards | 51,268 | 49,223 |
Prepaid income taxes | 11,753 | 4,708 |
Deferred income taxes | 30,860 | 23,853 |
Other current assets | 9,239 | 2,986 |
Total current assets | 412,884 | 331,582 |
Long-term receivables | 180,856 | 197,153 |
Property and equipment, net | 241,229 | 274,295 |
Goodwill | 697,470 | 697,470 |
Other intangible assets, net | 782,336 | 794,057 |
Deferred rent receivable | 91,117 | 91,423 |
Other non-current assets, net | 42,216 | 18,662 |
Total assets | 2,448,108 | 2,404,642 |
Current liabilities: | ||
Current maturities of long-term debt | 0 | 4,720 |
Accounts payable | 41,771 | 40,050 |
Gift card liability | 179,760 | 171,955 |
Accrued employee compensation and benefits | 25,722 | 24,956 |
Dividends payable | 16,635 | 0 |
Accrued interest payable | 14,126 | 13,575 |
Current maturities of capital lease and financing obligations | 14,852 | 12,247 |
Other accrued expenses | 20,183 | 16,770 |
Total current liabilities | 313,049 | 284,273 |
Long-term debt, less current maturities | 1,300,000 | 1,203,517 |
Capital lease obligations, less current maturities | 98,119 | 111,707 |
Financing obligations, less current maturities | 42,524 | 48,843 |
Deferred income taxes | 319,111 | 341,578 |
Deferred rent payable | 75,375 | 76,798 |
Other non-current liabilities | 20,857 | 22,747 |
Total liabilities | 2,169,035 | 2,089,463 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock, $0.01 par value; shares: 40,000,000 authorized; 2014 - 25,240,055 issued, 18,953,567 outstanding; 2013 - 25,299,315 issued, 19,040,890 outstanding | 252 | 253 |
Additional paid-in-capital | 279,946 | 274,202 |
Retained earnings | 313,644 | 336,578 |
Accumulated other comprehensive loss | -73 | -164 |
Treasury stock, at cost; shares: 2014 - 6,286,488; 2013 - 6,258,425 | -314,696 | -295,690 |
Total stockholders' equity | 279,073 | 315,179 |
Total liabilities and stockholders' equity | $2,448,108 | $2,404,642 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parentheticals) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ||
Common stock, par value per share | $0.01 | $0.01 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 25,240,055 | 25,299,315 |
Common stock, shares outstanding | 18,953,567 | 19,040,890 |
Treasury stock, shares outstanding | 6,286,488 | 6,258,425 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Segment Revenues: | |||
Franchise and restaurant revenues | $518,579 | $502,586 | $712,580 |
Rental revenues | 122,932 | 124,769 | 122,859 |
Financing revenues | 13,477 | 13,112 | 14,489 |
Total segment revenues | 654,988 | 640,467 | 849,928 |
Segment Expenses: | |||
Franchise and restaurant expenses | 184,411 | 173,232 | 359,196 |
Rental expenses | 94,637 | 97,298 | 97,165 |
Financing expenses | 825 | 245 | 1,623 |
Total segment expenses | 279,873 | 270,775 | 457,984 |
Gross segment profit | 375,115 | 369,692 | 391,944 |
General and administrative expenses | 145,910 | 143,586 | 163,215 |
Interest expense | 96,637 | 100,264 | 114,338 |
Amortization of intangible assets | 12,063 | 12,282 | 12,293 |
Closure and impairment charges | 3,721 | 1,812 | 4,218 |
Loss on extinguishment of debt | 64,859 | 58 | 5,554 |
Debt modification costs | 0 | 1,296 | 0 |
Loss (gain) on disposition of assets | 329 | -223 | -102,597 |
Income before income taxes | 51,596 | 110,617 | 194,923 |
Income tax provision | -15,143 | -38,580 | -67,249 |
Net income | 36,453 | 72,037 | 127,674 |
Other comprehensive income (loss), net of tax: | |||
Adjustment to unrealized loss on available-for-sale investments | 107 | 0 | 140 |
Foreign currency translation adjustment | -16 | -12 | 2 |
Total comprehensive income | 36,544 | 72,025 | 127,816 |
Net income available to common stockholders: | |||
Net income | 36,453 | 72,037 | 127,674 |
Less: Net income allocated to unvested participating restricted stock | -521 | -1,200 | -2,718 |
Less: Accretion of Series B preferred stock | 0 | 0 | -2,498 |
Net income available to common stockholders | $35,932 | $70,837 | $122,458 |
Net income available to common stockholders per share: | |||
Basic (USD per share) | $1.92 | $3.75 | $6.81 |
Diluted (USD per share) | $1.90 | $3.70 | $6.63 |
Weighted average shares outstanding: | |||
Basic (shares) | 18,753 | 18,871 | 17,992 |
Diluted (shares) | 18,956 | 19,141 | 18,877 |
Dividends declared per common share (USD per share) | $3.13 | $3 | $0 |
Dividends paid per common share (USD per share) | $2.25 | $3 | $0 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock |
In Thousands, except Share data, unless otherwise specified | |||||||
Stockholders' Equity, Beg at Dec. 31, 2011 | $155,220 | $44,508 | $247 | $205,663 | $196,869 | ($294) | ($291,773) |
Treasury Stock, Shares, Beg at Dec. 31, 2011 | 6,598,779 | ||||||
Common Stock, Shares, Outstanding, Beg at Dec. 31, 2011 | 18,060,206 | ||||||
Preferred Stock, Shares Outstanding, Beg at Dec. 31, 2011 | 34,900 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 127,674 | 127,674 | |||||
Other comprehensive income | 142 | 142 | |||||
Reissuance of treasury stock, shares | 433,732 | 433,732 | |||||
Reissuance of treasury stock | 7,453 | -6,636 | 14,089 | ||||
Net issuance of shares pursuant to stock plans, shares | 59,622 | ||||||
Net issuance of shares pursuant to stock plans | 1,800 | 1,800 | |||||
Repurchase of restricted shares, shares | -34,829 | ||||||
Repurchase of restricted shares | -1,740 | -1,740 | |||||
Stock-based compensation | 11,442 | 11,442 | |||||
Tax benefit from stock-based compensation | 6,814 | 6,814 | |||||
Conversion of Series B preferred stock, shares | -34,900 | 679,168 | |||||
Conversion of Series B preferred stock | 0 | -47,006 | 7 | 46,999 | |||
Accretion of Series B preferred stock | 0 | 2,498 | -2,498 | ||||
Stockholders' Equity, End at Dec. 31, 2012 | 308,805 | 0 | 254 | 264,342 | 322,045 | -152 | -277,684 |
Preferred Stock, Shares Outstanding, End at Dec. 31, 2012 | 0 | ||||||
Treasury Stock, Shares, End at Dec. 31, 2012 | 6,165,047 | ||||||
Common Stock, Shares, Outstanding, End at Dec. 31, 2012 | 19,197,899 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 72,037 | 72,037 | |||||
Other comprehensive income | -12 | -12 | |||||
Reissuance of treasury stock, shares | 318,644 | 318,644 | |||||
Reissuance of treasury stock | 9,080 | -2,612 | 11,692 | ||||
Net issuance of shares pursuant to stock plans, shares | -17,659 | ||||||
Net issuance of shares pursuant to stock plans | -1 | -1 | 0 | ||||
Repurchase of restricted shares, shares | -45,972 | ||||||
Repurchase of restricted shares | -3,324 | -3,324 | |||||
Stock-based compensation | 9,364 | 9,364 | |||||
Tax benefit from stock-based compensation | 3,690 | 3,690 | |||||
Purchase of DineEquity common stock, shares | -412,022 | -412,022 | -412,022 | ||||
Purchase of DineEquity common stock | -29,698 | -29,698 | |||||
Dividends on common stock | -57,365 | 139 | -57,504 | ||||
Conversion of liability award to equity award | 2,603 | 2,603 | |||||
Stockholders' Equity, End at Dec. 31, 2013 | 315,179 | 0 | 253 | 274,202 | 336,578 | -164 | -295,690 |
Preferred Stock, Shares Outstanding, End at Dec. 31, 2013 | 0 | ||||||
Treasury Stock, Shares, End at Dec. 31, 2013 | 6,258,425 | 6,258,425 | |||||
Common Stock, Shares, Outstanding, End at Dec. 31, 2013 | 19,040,890 | 19,040,890 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 36,453 | 36,453 | |||||
Other comprehensive income | 91 | 91 | |||||
Reissuance of treasury stock, shares | 359,528 | 359,528 | |||||
Reissuance of treasury stock | 8,207 | -4,793 | 13,000 | ||||
Net issuance of shares pursuant to stock plans, shares | -20,767 | ||||||
Net issuance of shares pursuant to stock plans | 0 | -1 | 1 | ||||
Repurchase of restricted shares, shares | -38,493 | ||||||
Repurchase of restricted shares | -3,194 | -3,194 | |||||
Stock-based compensation | 9,319 | 9,319 | |||||
Tax benefit from stock-based compensation | 4,316 | 4,316 | |||||
Purchase of DineEquity common stock, shares | -387,591 | -387,591 | |||||
Purchase of DineEquity common stock | -32,006 | -32,006 | |||||
Dividends on common stock | -59,292 | 95 | -59,387 | ||||
Stockholders' Equity, End at Dec. 31, 2014 | $279,073 | $0 | $252 | $279,946 | $313,644 | ($73) | ($314,696) |
Preferred Stock, Shares Outstanding, End at Dec. 31, 2014 | 0 | ||||||
Treasury Stock, Shares, End at Dec. 31, 2014 | 6,286,488 | 6,286,488 | |||||
Common Stock, Shares, Outstanding, End at Dec. 31, 2014 | 18,953,567 | 18,953,567 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities | |||
Net income | $36,453 | $72,037 | $127,674 |
Adjustments to reconcile net income to cash flows provided by operating activities: | |||
Depreciation and amortization | 34,745 | 35,355 | 39,538 |
Non-cash interest expense | 5,770 | 6,246 | 5,985 |
Loss on extinguishment of debt | 64,859 | 58 | 5,554 |
Closure and impairment charges | 3,687 | 2,195 | 3,931 |
Deferred income taxes | -30,236 | -22,674 | -22,832 |
Non-cash stock-based compensation expense | 9,319 | 9,364 | 11,442 |
Tax benefit from stock-based compensation | 4,316 | 3,690 | 6,814 |
Excess tax benefit from stock options exercised | -5,028 | -2,858 | -5,669 |
Loss (gain) on disposition of assets | 329 | -223 | -102,597 |
Other | -3,344 | -492 | -8,991 |
Changes in operating assets and liabilities: | |||
Receivables | -7,997 | -15,226 | -11,629 |
Current income tax receivables and payables | -5,868 | 6,143 | 1,272 |
Other current assets | -1,771 | 9,334 | -9,119 |
Accounts payable | 1,245 | 8,532 | 1,778 |
Accrued employee compensation and benefits | 767 | 2,521 | -3,756 |
Gift card liability | 7,803 | 10,266 | 14,735 |
Other accrued expenses | 3,475 | 3,547 | -1,251 |
Cash flows provided by operating activities | 118,524 | 127,815 | 52,879 |
Cash flows from investing activities | |||
Additions to property and equipment | -5,937 | -7,037 | -16,952 |
Proceeds from sale of property and equipment and assets held for sale | 681 | 0 | 168,881 |
Principal receipts from notes, equipment contracts and other long-term receivables | 15,284 | 13,982 | 12,250 |
Other | 540 | 58 | 1,238 |
Cash flows provided by investing activities | 10,568 | 7,003 | 165,417 |
Cash flows from financing activities | |||
Borrowings under revolving credit facilities | 0 | 0 | 50,000 |
Repayments under revolving credit facilities | 0 | 0 | -50,000 |
Proceeds from issuance of long-term debt | 1,300,000 | 0 | 0 |
Repayment of long-term debt (including premiums) | -1,264,086 | -4,800 | -216,037 |
Principal payments on capital lease and financing obligations | -11,825 | -9,968 | -10,849 |
Payment of debt modification/issuance costs | -24,192 | -1,296 | 0 |
Dividends paid on common stock | -42,733 | -57,445 | 0 |
Repurchase of DineEquity common stock | -32,006 | -29,698 | 0 |
Repurchase of restricted stock | -3,194 | -3,324 | -1,740 |
Proceeds from stock options exercised | 8,207 | 9,080 | 9,254 |
Excess tax benefit from stock options exercised | 5,028 | 2,858 | 5,669 |
Change in restricted cash | -66,298 | 1,249 | -747 |
Cash flows used in financing activities | -131,099 | -93,344 | -214,450 |
Net change in cash and cash equivalents | -2,007 | 41,474 | 3,846 |
Cash and cash equivalents at beginning of year | 106,011 | 64,537 | 60,691 |
Cash and cash equivalents at end of year | 104,004 | 106,011 | 64,537 |
Supplemental disclosures | |||
Interest paid | 104,164 | 106,784 | 123,926 |
Income taxes paid | $47,226 | $50,702 | $91,354 |
The_Company
The Company | 12 Months Ended |
Dec. 31, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company | The Company |
The first International House of Pancakes® (“IHOP®”) restaurant opened in 1958 in Toluca Lake, California. Shortly thereafter, the Company began developing and franchising additional restaurants. The Company was incorporated as IHOP Corp. under the laws of the State of Delaware in 1976. In November 2007, the Company acquired Applebee's International, Inc., which became a wholly-owned subsidiary of the Company. Effective June 2, 2008, the name of the Company was changed to DineEquity, Inc. (“DineEquity”). The Company owns, franchises and operates two restaurant concepts: Applebee's Neighborhood Grill and Bar® (“Applebee's®”), in the bar and grill segment within the casual dining category of the restaurant industry, and IHOP in the family dining category of the restaurant industry. | |
As of December 31, 2014, there were a total of 1,650 IHOP restaurants, of which 1,472 were subject to franchise agreements, 167 were subject to area license agreements and 11 were company-operated restaurants. These IHOP restaurants were located in all 50 states of the United States, the District of Columbia, two United States territories and eight countries outside of the United States. As of December 31, 2014, there were a total of 2,017 Applebee's restaurants, of which 1,994 were subject to franchise agreements and 23 were company-operated restaurants. These Applebee's restaurants were located in 49 states of the United States, two United States territories and 15 countries outside of the United States. | |
References herein to Applebee's and IHOP restaurants are to these restaurant concepts, whether operated by franchisees, area licensees or the Company. Retail sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. |
Basis_of_Presentation_and_Summ
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Accounting Policies [Abstract] | ||||||||||||||||
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies | |||||||||||||||
Principles of Consolidation | ||||||||||||||||
The consolidated financial statements include the accounts of DineEquity, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. | ||||||||||||||||
Fiscal Periods | ||||||||||||||||
The Company has a 52/53 week fiscal year that ends on the Sunday nearest to December 31 of each year. In a 52-week fiscal year, each fiscal quarter contains 13 weeks, comprised of two, four-week fiscal months followed by a five-week fiscal month. In a 53-week fiscal year, the last month of the fourth fiscal quarter contains six weeks. For convenience, the Company refers to all fiscal years as ending on December 31 and fiscal quarters as ending on March 31, June 30 and September 30. The 2014, 2013 and 2012 fiscal years presented herein ended December 28, 2014, December 29, 2013 and December 30, 2012, respectively, and each contained 52 weeks. | ||||||||||||||||
Use of Estimates | ||||||||||||||||
The preparation of financial statements in conformity with United States generally accepted accounting principles (“U.S. GAAP”) requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, if any, at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant estimates are made in the calculation and assessment of the following: (a) impairment of tangible and intangible assets, (b) income taxes, (c) allowance for doubtful accounts and notes receivables, (d) lease accounting estimates and (e) contingencies. On an ongoing basis, the Company evaluates its estimates based on historical experience, current conditions and various other assumptions that are believed to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Actual results could differ from those estimates. | ||||||||||||||||
Concentration of Credit Risk | ||||||||||||||||
The Company's cash, cash equivalents and accounts receivable are potentially subject to concentration of credit risk. Cash and cash equivalents are placed with financial institutions that management believes are creditworthy. The Company does not believe that it is exposed to any significant credit risk on cash and cash equivalents. At times, cash and cash equivalent balances may be in excess of FDIC insurance limits. | ||||||||||||||||
Accounts receivable are derived from revenues earned from franchisees and area licensees located primarily in the United States. Financing receivables arise from the financing of restaurant equipment, leases or franchise fees by IHOP franchisees. The Company is subject to a concentration of credit risk with respect to receivables from franchisees that own a large number of Applebee's or IHOP restaurants. As of December 31, 2014, there were 15 franchisees that owned 54 or more restaurants each (11 Applebee's franchisees and four IHOP franchisees). These franchisees operated 1,693 Applebee's and IHOP restaurants in the United States, which comprised 49% of the total Applebee's and IHOP franchise and area license restaurants in the United States. Receivables from these franchisees totaled $50.7 million at December 31, 2014. | ||||||||||||||||
The Company maintains an allowance for credit losses based upon historical experience while taking into account current economic conditions. | ||||||||||||||||
Cash and Cash Equivalents | ||||||||||||||||
The Company considers all highly liquid investment securities with remaining maturities at the date of purchase of three months or less to be cash equivalents. These cash equivalents are stated at cost which approximates market value. Cash held related to IHOP advertising funds and the Company's gift card programs are classified as unrestricted cash as there are no legal restrictions on the use of these funds. Total cash balances related to the IHOP advertising funds and the Company's gift card programs were $56.2 million and $53.2 million as of December 31, 2014 and 2013, respectively. | ||||||||||||||||
Restricted Assets | ||||||||||||||||
Restricted Cash - Current | ||||||||||||||||
Current restricted cash of $52.3 million as of December 31, 2014 consisted of $52.1 million of funds required to be held in trust in connection with the Company's securitized debt arrangements and $0.2 million of funds from Applebee's franchisees pursuant to franchise agreements, usage of which is restricted to advertising activities. Current restricted cash of $0.7 million at December 31, 2013 related to funds from Applebee's franchisees pursuant to franchise agreements, usage of which is restricted to advertising activities. | ||||||||||||||||
Restricted Cash - Non-current | ||||||||||||||||
Non-current restricted cash of $14.7 million as of December 31, 2014 represents interest reserves required to be set aside for the duration of the securitized debt and is included in other non-current assets, net in the consolidated balance sheets. | ||||||||||||||||
Other Restricted Assets | ||||||||||||||||
At December 31, 2014 and 2013, restricted assets related to a captive insurance subsidiary totaled $1.2 million and $1.9 million, respectively, and were included in other non-current assets, net in the consolidated balance sheets. The captive insurance subsidiary, which has not underwritten coverage since January 2006, was formed to provide insurance coverage to Applebee's and its franchisees. These restricted assets are primarily investments, use of which is restricted to the payment of insurance claims for incidents that occurred during the period the insurance coverage had been provided. | ||||||||||||||||
Investments | ||||||||||||||||
The Company's investments comprise certificates of deposit, money market funds and an auction rate security that are the restricted assets related to the captive insurance subsidiary. The Company has classified all investments as available-for-sale with any unrealized gain or loss included in Accumulated Other Comprehensive Loss. The contractual maturity of the auction rate security is 2030. | ||||||||||||||||
Property and Equipment | ||||||||||||||||
Property and equipment are stated at cost, net of accumulated depreciation. Properties under capital leases are stated at the present value of the minimum lease payments. Depreciation is computed using the straight-line method over the estimated useful lives of the assets or remaining useful lives. Leasehold improvements and properties under capital leases are amortized on a straight-line basis over their estimated useful lives or the lease term, if less. The Company has capitalized certain costs incurred in connection with the development of internal-use software which are included in equipment and fixtures and amortized over the expected useful life of the asset. The general ranges of depreciable and amortizable lives are as follows: | ||||||||||||||||
Category | Depreciable Life | |||||||||||||||
Buildings and improvements | 25 - 40 years | |||||||||||||||
Leaseholds and improvements | Shorter of primary lease term or between three to 40 years | |||||||||||||||
Equipment and fixtures | Two to 10 years | |||||||||||||||
Properties under capital leases | Primary lease term or remaining primary lease term | |||||||||||||||
Long-Lived Assets | ||||||||||||||||
The Company evaluates the recoverability of its long-lived assets in accordance with U.S. GAAP. The Company tests impairment using historical cash flows and other relevant facts and circumstances as the primary basis for estimates of future cash flows. The Company considers factors such as the number of years a restaurant has been in operation, sales trends, cash flow trends, remaining lease life and other factors which apply on a case-by-case basis. The analysis is performed at the individual restaurant level for indicators of permanent impairment. | ||||||||||||||||
Recoverability of a restaurant's assets is measured by comparing the assets' carrying value to the undiscounted future cash flows expected to be generated over the assets' remaining useful life or remaining lease term, whichever is less. If the total expected undiscounted future cash flows are less than the carrying amount of the assets, this may be an indicator of impairment. If it is decided that there has been an impairment, the carrying amount of the asset is written down to the estimated fair value as determined in accordance with U.S. GAAP governing fair value measurements. The primary method of estimating fair value is based on a discounted cash flow analysis. A loss resulting from impairment is recognized as a charge against operations. | ||||||||||||||||
The Company may decide to close certain company-operated restaurants. Typically such decisions are based on operating performance or strategic considerations. In these instances, the Company reserves, or writes off, the full carrying value of these restaurants as impaired. | ||||||||||||||||
On a regular (at a minimum, semi-annual) basis, the Company assesses whether events or changes in circumstances have occurred that potentially indicate the carrying value of long-lived assets may not be recoverable. See Note 12, Closure and Impairment Charges. | ||||||||||||||||
Goodwill and Intangible Assets | ||||||||||||||||
Goodwill is recorded when the aggregate purchase price of an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Intangible assets resulting from the acquisition are accounted for using the purchase method of accounting and are estimated by management based on the fair value of the assets received. The Company's identifiable intangible assets are comprised primarily of the Applebee's tradename and Applebee's franchise agreements. Identifiable intangible assets with finite lives (franchise agreements, recipes and menus) are amortized over the period of estimated benefit using the straight-line method and estimated useful lives. Goodwill and intangible assets considered to have an indefinite life (primarily the Applebee's tradename) are not subject to amortization. The determination of indefinite life is subject to reassessment if changes in facts and circumstances indicate the period of benefit has become finite. | ||||||||||||||||
Goodwill was allocated to three reporting units, the Applebee's company-operated restaurants unit (“Applebee's company unit”), the Applebee's franchised restaurants unit (“Applebee's franchise unit”) and the IHOP franchised restaurants unit (“IHOP franchise unit”), in accordance with U.S. GAAP. The significant majority of the Company's goodwill resulted from the November 29, 2007 acquisition of Applebee's and was allocated between the two Applebee's units. The goodwill allocated to the Applebee's company unit was fully impaired in 2008. | ||||||||||||||||
The Company performs a quantitative test for impairment of the goodwill of the Applebee's franchise unit and the tradename of the Applebee's company and franchise units as of October 31 of each year. The goodwill of the IHOP franchise unit is assessed qualitatively as of December 31 of each year. In addition to the annual test of impairment, goodwill and indefinite life intangible assets are evaluated more frequently if the Company believes indicators of impairment exist. Such indicators include, but are not limited to, events or circumstances such as a significant adverse change in the business climate, unanticipated competition, a loss of key personnel, adverse legal or regulatory developments or a significant decline in the market price of the Company's common stock. | ||||||||||||||||
In the process of the annual quantitative test of goodwill, the Company primarily uses the income approach method of valuation that includes the discounted cash flow method as well as other generally accepted valuation methodologies to determine the fair value of goodwill and intangible assets. Significant assumptions used to determine fair value under the discounted cash flow model include future trends in sales, operating expenses, overhead expenses, capital expenditures and changes in working capital, along with an appropriate discount rate based on the Company's estimated cost of equity capital and after-tax cost of debt. The first step of the quantitative impairment test compares the fair value of each of the reporting units to their carrying value. If the fair value is in excess of the carrying value, no impairment exists. If the first step does indicate impairment, a second step must take place. Under the second step, the fair value of the assets and liabilities of the reporting unit are estimated as if the reporting unit were acquired in a business combination. The excess of the fair value of the reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of the goodwill, to which the carrying value of the goodwill must be adjusted. | ||||||||||||||||
In the process of the Company's annual impairment review of the tradename, the most significant indefinite life intangible asset, the Company primarily uses the relief of royalty method under income approach method of valuation. Significant assumptions used to determine fair value under the relief of royalty method include future trends in sales, a royalty rate and a discount rate to be applied to the forecast revenue stream. | ||||||||||||||||
There were no impairments of goodwill or intangible assets recorded in 2014, 2013 or 2012. | ||||||||||||||||
Revenue Recognition | ||||||||||||||||
The Company's revenues are recorded in four categories: franchise operations, company restaurant operations, rental operations and financing operations. | ||||||||||||||||
Franchise operations revenue consists primarily of royalty revenues, sales of proprietary IHOP products, IHOP advertising fees and the portion of the franchise fees allocated to the Company's intellectual property. Company restaurant sales are retail sales at company-operated restaurants. Rental operations revenue includes revenue from operating leases and interest income from direct financing leases. Financing operations revenue consists primarily of interest income from the financing of franchise fees and equipment leases, as well as sales of equipment associated with refranchised IHOP restaurants. | ||||||||||||||||
Revenues from franchised and area licensed restaurants include royalties, continuing rent and service fees and initial franchise fees. Royalties are recognized in the period in which the sales are reported to have been earned, which occurs at the franchisees' point of sale. Continuing rent and fees are recognized in the period earned. Initial franchise fees are recognized upon the opening of a restaurant, which is when the Company has performed substantially all initial services required by the franchise agreement. Fees from development agreements are deferred and recorded into income as restaurants under the development agreement are opened. | ||||||||||||||||
Sales by company-operated restaurants are recognized when food and beverage items are sold. Company restaurant sales are reported net of sales taxes collected from guests that are remitted to the appropriate taxing authorities. | ||||||||||||||||
The Company records a liability in the period in which a gift card is sold and recognizes costs associated with our administration of the gift card programs as prepaid assets when the costs are incurred. As gift cards are redeemed, the liability and prepaid asset are reduced. When gift cards are redeemed at a franchisee-operated restaurant, the revenue and related administrative costs are recognized by the franchisee. The Company recognizes revenue and related administrative costs when gift cards are redeemed at company-operated restaurants. The Company recognizes gift card breakage income on gift cards when the assessment of the likelihood of redemption of the gift card becomes remote. This assessment is based upon Applebee's and IHOP's individual historical experience with gift card redemptions in their own program. The Company recorded gift card breakage revenue of $0.1 million, $0.2 million and $1.3 million for the years ended December 31, 2014, 2013 and 2012, respectively. The decline from 2012 to 2013 was due to the decrease in the number of Applebee's company-operated restaurants. | ||||||||||||||||
Allowance for Credit Losses | ||||||||||||||||
The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in existing receivables; however, changes in circumstances relating to receivables may result in additional allowances in the future. The Company determines the allowance based on historical experience, current payment patterns, future obligations and the Company's assessment of the franchisee's or area licensee's ability to pay outstanding balances. The primary indicator of credit quality is delinquency, which is considered to be a receivable balance greater than 90 days past due. The Company continually reviews the allowance for doubtful accounts. Past due balances and future obligations are reviewed individually for collectability. Account balances are charged against the allowance after all collection efforts have been exhausted and the potential for recovery is considered remote. | ||||||||||||||||
Leases | ||||||||||||||||
The Company is the lessor or sub-lessor of the properties on which 709 IHOP restaurants and one Applebee's restaurant are located. The restaurants are subleased to franchisees or, in a few instances, are operated by the Company. The Company's IHOP leases generally provide for an initial term of 15 to 25 years, with most having one or more five-year renewal options at the Company's option. In addition, the Company leases a majority of its Applebee's company-operated restaurants. The Applebee's company-operated leases generally have an initial term of 10 to 20 years, with renewal terms of five to 20 years, and provide for a fixed rental plus, in certain instances, percentage rentals based on gross sales. The rental payments or receipts on leases that meet the operating lease criteria are recorded as rental expense or rental income, respectively. Rental expense and rental income for these operating leases are recognized on the straight-line basis over the original terms of the leases. Any difference between straight-line rent expense or income and actual amounts paid or received represents deferred rent and is included in the consolidated balance sheets as other assets or other liabilities, as appropriate. | ||||||||||||||||
The rental payments or receipts on those property leases that meet the capital lease criteria result in the recognition of interest expense or interest income and a reduction of capital lease obligation or financing lease receivable, respectively. Capital lease obligations are amortized based on the Company's incremental borrowing rate and direct financing leases are amortized using the implicit interest rate. | ||||||||||||||||
The lease term used for straight-line rent expense is calculated from the date the Company obtains possession of the leased premises through the lease termination date. The Company records rent from the possession date through restaurant open date as expense. Once a restaurant opens for business, the Company records straight-line rent over the lease term plus contingent rent to the extent it exceeded the minimum rent obligation per the lease agreement. The Company uses a consistent lease term when calculating depreciation of leasehold improvements, when determining straight-line rent expense and when determining classification of its leases as either operating or capital. For leases that contain rent escalations, the Company records the total rent payable during the lease term, as determined above, on the straight-line basis over the term of the lease (including the rent holiday period beginning upon our possession of the premises), and records the difference between the minimum rents paid and the straight-line rent as a lease obligation. Certain leases contain provisions that require additional rental payments based upon restaurant sales volume (“contingent rent”). Contingent rentals are accrued each period as the liabilities are incurred, in addition to the straight-line rent expense noted above. | ||||||||||||||||
Certain lease agreements contain tenant improvement allowances, rent holidays and lease premiums, which are amortized over the shorter of the estimated useful life or lease term. For tenant improvement allowances, the Company also records a deferred rent liability or an obligation in non-current liabilities on the consolidated balance sheets and amortizes the deferred rent over the term of the lease as a reduction to company restaurant expenses in the consolidated statements of comprehensive income. | ||||||||||||||||
Pre-opening Expenses | ||||||||||||||||
Expenditures related to the opening of new or relocated restaurants are charged to expense when incurred. | ||||||||||||||||
Advertising | ||||||||||||||||
Franchise fees designated for IHOP's national advertising fund and local marketing and advertising cooperatives are recognized as revenue as the fees are earned and become receivables from the franchisee in accordance with U.S. GAAP governing the accounting for franchise fee revenue. In accordance with U.S. GAAP governing advertising costs, related advertising obligations are accrued and the costs expensed at the same time the related revenue is recognized. Due to different contractual terms in Applebee's marketing agreements, franchise fees designated for Applebee's national advertising fund and local advertising cooperatives constitute agency transactions and are not recognized as revenues and expenses. In both cases, the advertising fees are recorded as a liability against which specific costs are charged. Advertising fees included in IHOP franchise revenue and expense for the years ended December 31, 2014, 2013 and 2012 were $90.3 million, $79.5 million and $76.4 million, respectively. | ||||||||||||||||
Advertising expense reflected in the consolidated statements of comprehensive income includes local marketing advertising costs incurred by company-operated restaurants, contributions to the national advertising fund made by Applebee's and IHOP company-operated restaurants and certain advertising costs incurred by the Company to benefit future franchise operations. Costs of advertising are expensed either as incurred or the first time the advertising takes place. Advertising expense included in company restaurant operations for the years ended December 31, 2014, 2013 and 2012 was $2.9 million, $2.9 million and $13.1 million, respectively. The decline from 2012 to 2013 was due to the decrease in the number of Applebee's company-operated restaurants. | ||||||||||||||||
Fair Value Measurements | ||||||||||||||||
The Company determines the fair market values of its financial assets and liabilities, as well as non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis, based on the fair value hierarchy established in U.S. GAAP. As necessary, the Company measures its financial assets and liabilities using inputs from the following three levels of the fair value hierarchy: | ||||||||||||||||
• | Level 1 inputs are quoted prices in active markets for identical assets or liabilities. | |||||||||||||||
• | Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities. | |||||||||||||||
• | Level 3 inputs are unobservable and reflect the Company's own assumptions. | |||||||||||||||
The Company does not have a material amount of financial assets or liabilities that are required under U.S. GAAP to be measured at fair value on either a recurring or non-recurring basis. None of the Company's non-financial assets or non-financial liabilities is required to be measured at fair value on a recurring basis. The Company has not elected to use fair value measurement for any assets or liabilities for which fair value measurement is not presently required. | ||||||||||||||||
The Company believes the fair values of cash equivalents, accounts receivable, accounts payable and the current portion of long-term debt approximate their carrying amounts due to their short duration. | ||||||||||||||||
The fair values of non-current financial instruments, determined based on Level 2 inputs, are shown in the following table: | ||||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||
Carrying | Fair Value | Carrying | Fair Value | |||||||||||||
Amount | Amount | |||||||||||||||
(In millions) | ||||||||||||||||
Long-term debt, less current maturities | $ | 1,300.00 | $ | 1,302.00 | $ | 1,203.50 | $ | 1,306.20 | ||||||||
Income Taxes | ||||||||||||||||
The Company utilizes the liability method of accounting for income taxes. Under the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates. A valuation allowance is recorded when it is more likely than not that some or all of the deferred tax assets will not be realized. The Company also determines its tax contingencies in accordance with U.S. GAAP governing the accounting for contingencies. The Company records estimated tax liabilities to the extent the contingencies are probable and can be reasonably estimated. The Company recognizes interest accrued related to unrecognized tax benefits and penalties as a component of the income tax provision recognized in the Consolidated Statements of Comprehensive Income. | ||||||||||||||||
The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by taxing authorities including all appeals or litigation processes, based on its technical merits. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate resolution. For each reporting period, management applies a consistent methodology to measure and adjust all uncertain tax positions based on the available information. | ||||||||||||||||
Stock-Based Compensation | ||||||||||||||||
Members of the Board of Directors and certain employees are eligible to receive stock options, restricted stock, restricted stock units and performance units pursuant to the DineEquity, Inc. 2011 Stock Incentive Plan. The Company accounts for all stock-based payments to employees and non-employee directors, including grants of stock options, restricted stock and restricted stock units to be recognized in the financial statements, based on their respective grant date fair values. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service periods. The Company reports the benefits of tax deductions in excess of recognized compensation cost as a financing cash flow. | ||||||||||||||||
The grant date fair value of restricted stock and stock-settled restricted stock units is determined based on the Company's stock price on the grant date. The Company estimates the grant date fair value of stock option awards using the Black-Scholes option pricing model, which considers, among other factors, a risk-free interest rate, the expected life of the award and the historical volatility of the Company's stock price. Cash-settled awards are classified as liabilities with the liability and compensation expense related to cash-settled awards adjusted to fair value at each balance sheet date. | ||||||||||||||||
Net Income Per Share | ||||||||||||||||
Net income per share is calculated using the two-step method prescribed in U.S. GAAP. Basic net income per share is computed by dividing the net income available to common stockholders for the period by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing the net income (loss) available to common stockholders for the period by the weighted average number of common shares and potential shares of common stock outstanding during the period if their effect is dilutive. The Company uses the treasury stock method to calculate the weighted average shares used in the diluted earnings per share calculation. Potentially dilutive common shares include the assumed exercise of stock options, assumed vesting of restricted stock and, during fiscal years in which Series B Preferred Stock was outstanding, assumed conversion of Series B Preferred Stock using the if-converted method. | ||||||||||||||||
Other Comprehensive Income (Loss) | ||||||||||||||||
For the years ended December 31, 2014, 2013 and 2012, the income tax benefit or provision allocated to items of other comprehensive income was not significant. | ||||||||||||||||
Treasury Stock | ||||||||||||||||
The Company may from time to time utilize treasury stock when vested stock options are exercised, when restricted stock awards are granted and when restricted stock units settle in stock upon vesting. The cost of treasury stock re-issued is determined using the first-in, first-out method. | ||||||||||||||||
Business Segments | ||||||||||||||||
The Company identifies its reporting segments based on the organizational units used by management to monitor performance and make operating decisions. These reporting segments are as follows: franchise operations, company restaurant operations, rental operations and financing operations. Within the franchise and company restaurant segments, the Company operates two different restaurant concepts, Applebee's and IHOP. Applebee's has no material rental or financing operations. | ||||||||||||||||
Franchise Segment | ||||||||||||||||
As of December 31, 2014, the franchise operations segment consisted of 1,994 restaurants operated by Applebee's franchisees in the United States, two United States territories and 15 countries outside of the United States and 1,639 restaurants operated by IHOP franchisees and area licensees in the United States, two United States territories and eight countries outside of the United States. Franchise operations revenue consists primarily of franchise royalty revenues, sales of proprietary products (primarily IHOP pancake and waffle dry-mixes) and the portion of the franchise fees allocated to IHOP and Applebee's intellectual property. Additionally, franchise fees designated for IHOP's national advertising fund and local marketing and advertising cooperatives are recognized as revenue and expense of franchise operations; however, due to different contractual terms in Applebee's marketing agreements, Applebee's national advertising fund activity constitutes agency transactions and therefore is not recognized as franchise revenue and expense. | ||||||||||||||||
Franchise operations expenses include IHOP advertising expense, the cost of proprietary products, pre-opening training expenses and other franchise-related costs. | ||||||||||||||||
Company Segment | ||||||||||||||||
As of December 31, 2014, the company restaurant operations segment consisted of 23 Applebee's company-operated restaurants, 10 IHOP company-operated restaurants and one IHOP restaurant reacquired from franchisees and operated by the Company on a temporary basis until refranchised. All company-operated restaurants are located in the United States. | ||||||||||||||||
Company restaurant sales are retail sales at company-operated restaurants. Company restaurant expenses are operating expenses at company-operated restaurants and include food, beverage, labor, benefits, utilities, rent and other operating costs. | ||||||||||||||||
Rental Segment | ||||||||||||||||
Rental operations revenue includes revenue from operating leases and interest income from direct financing leases. Rental operations expenses are costs of operating leases and interest expense of capital leases on franchisee-operated restaurants. The rental operations revenue and expenses are primarily generated by IHOP. Applebee's has an insignificant amount of rental activity related to one property that was retained after refranchising a company-operated restaurant. | ||||||||||||||||
Financing Segment | ||||||||||||||||
Financing operations revenue primarily consists of interest income from the financing of IHOP franchise fees and equipment leases, as well as sales of equipment associated with refranchised IHOP restaurants. Financing expenses are the cost of restaurant equipment. | ||||||||||||||||
Recently Adopted Accounting Standards | ||||||||||||||||
The Company adopted the following accounting standards as of January 1, 2014: | ||||||||||||||||
• | Accounting Standards Update (“ASU”) No. 2013-04, Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date (“ASU 2013-04”). The amendments in ASU 2013-04 require an entity to measure obligations resulting from joint and several liability arrangements as the amount the entity agreed to pay on the basis of the arrangement among its co-obligors plus the amount an entity expects to pay on behalf of co-obligors. ASU 2013-04 also requires an entity to disclose the nature, amount and other information about each obligation or group of similar obligations. | |||||||||||||||
• | ASU No. 2013-11, Income Taxes - Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). ASU 2013-11 provides guidance on the financial statement presentation of an unrecognized tax benefit, as either a reduction of a deferred tax asset or as a liability, when a net operating loss carryforward, similar tax loss, or a tax credit carryforward exists. | |||||||||||||||
The adoption of these standards did not have a material impact on our consolidated financial statements. | ||||||||||||||||
New Accounting Pronouncements | ||||||||||||||||
In April 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (“ASU 2014-08”). The amendments in ASU 2014-08 change the criteria for the reporting of discontinued operations. Under ASU 2014-08, only disposals resulting in a strategic shift that will have a major effect on an entity's operations and financial results will be reported as discontinued operations. ASU 2014-08 also removes the requirement under current U.S. GAAP that an entity not have any significant continuing involvement in the operations of the component after disposal to qualify for reporting of the disposal as a discontinued operation. The Company will be required to apply the provisions of ASU 2014-08 prospectively to all disposals of components beginning with its first fiscal quarter of 2015. Early adoption is permitted for any disposal transaction not previously reported. | ||||||||||||||||
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The Company will be required to apply the provisions of ASU 2014-09 beginning with its first fiscal quarter of 2017, either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption; early adoption is not permitted. | ||||||||||||||||
The guidance in ASU 2014-09 supersedes nearly all of the existing general revenue recognition guidance under U.S. GAAP as well as most industry-specific revenue recognition guidance, including guidance with respect to revenue recognition by franchisors. The Company believes the recognition of the majority of its revenues, including franchise royalty revenues, sales of IHOP pancake and waffle dry mix and retail sales at company-operated restaurants will not be affected by ASU 2014-09. Additionally, lease rental revenues are not within the scope of ASU 2014-09 guidance. The Company is currently evaluating the effect that ASU 2014-09 will have on its financial statements and related disclosures and which method of adoption will be used. | ||||||||||||||||
The Company reviewed all other newly issued accounting pronouncements and concluded that they either are not applicable to the Company's operations or that no material effect is expected on the Company's financial statements as a result of future adoption. |
Receivables
Receivables | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Receivables [Abstract] | ||||||||
Receivables | Receivables | |||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Accounts receivable | $ | 65.9 | $ | 59.4 | ||||
Gift card receivables | 69 | 68.3 | ||||||
Notes receivable | 1.9 | 1.2 | ||||||
Financing receivables: | ||||||||
Equipment leases receivable | 107.3 | 115.1 | ||||||
Direct financing leases receivable | 81.6 | 88.6 | ||||||
Franchise fee notes receivable | 1.3 | 1.7 | ||||||
Other | 10.3 | 10.6 | ||||||
337.3 | 344.8 | |||||||
Less: allowance for doubtful accounts | (2.9 | ) | (3.5 | ) | ||||
334.4 | 341.3 | |||||||
Less: current portion | (153.5 | ) | (144.1 | ) | ||||
Long-term receivables | $ | 180.9 | $ | 197.2 | ||||
Accounts receivable primarily includes receivables due from franchisees and distributors. Gift card receivables consist primarily of amounts due from third-party vendors. Interest is not charged on gift card receivables. | ||||||||
Financing receivables primarily relate to IHOP franchise development activity prior to 2003 when IHOP typically leased or purchased the restaurant site, built and equipped the restaurant then franchised the restaurant to a franchisee. IHOP provided the financing for the franchise fee, leasing of the equipment and the leasing or subleasing of the site. Equipment lease contracts are due in equal weekly installments, primarily bear interest averaging 9.8% per annum at both December 31, 2014 and 2013 and are collateralized by the equipment. The term of an equipment lease contract coincides with the term of the corresponding restaurant building lease. The IHOP franchise fee notes have a term of five to eight years and are due in equal weekly installments, primarily bear interest averaging 6.4% and 6.6% per annum at December 31, 2014 and 2013, respectively, and are collateralized by the franchise. Where applicable, franchise fee notes, equipment contracts and building leases contain cross-default provisions wherein a default under one constitutes a default under all. There is not a disproportionate concentration of credit risk in any geographic area. | ||||||||
The primary indicator of the credit quality of financing receivables is delinquency. As of December 31, 2014 and 2013, approximately $0.4 million of financing receivables were delinquent more than 90 days. | ||||||||
The following table summarizes the activity in the allowance for doubtful accounts: | ||||||||
Allowance for Doubtful Accounts | (In millions) | |||||||
Balance at December 31, 2011 | $ | 3.6 | ||||||
Provision | 0.5 | |||||||
Charge-offs | (1.9 | ) | ||||||
Recoveries | 0.5 | |||||||
Balance at December 31, 2012 | 2.7 | |||||||
Provision | 1.5 | |||||||
Charge-offs | (0.7 | ) | ||||||
Recoveries | 0 | |||||||
Balance at December 31, 2013 | 3.5 | |||||||
Provision | 0.5 | |||||||
Charge-offs | (1.1 | ) | ||||||
Balance at December 31, 2014 | $ | 2.9 | ||||||
As of December 31, 2014 and 2013, approximately $0.3 million of the allowance for doubtful accounts in each year related to financing receivables. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Property and Equipment | Property and Equipment | |||||||
Property and equipment by category is as follows: | ||||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Land | $ | 59.2 | $ | 63.8 | ||||
Buildings and improvements | 58.7 | 60.1 | ||||||
Leaseholds and improvements | 258.3 | 274.9 | ||||||
Equipment and fixtures | 78.4 | 81.8 | ||||||
Construction in progress | 5.1 | 3.6 | ||||||
Properties under capital lease | 59.2 | 60 | ||||||
Property and equipment, gross | 518.9 | 544.3 | ||||||
Less: accumulated depreciation and amortization | (277.7 | ) | (270.0 | ) | ||||
Property and equipment, net | $ | 241.2 | $ | 274.3 | ||||
The Company recorded depreciation expense on property and equipment of $22.7 million, $23.1 million and $27.9 million for the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||
Accumulated depreciation and amortization includes accumulated amortization for properties under capital lease in the amount of $36.8 million and $34.7 million at December 31, 2014 and 2013, respectively. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2014 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill |
The significant majority of the Company's goodwill and other intangible assets arose from the November 29, 2007 acquisition of Applebee's. As of December 31, 2014 and 2013, the balance of goodwill was $697.5 million, of which $686.7 million has been allocated to the Applebee's franchise reporting unit and $10.8 million to the IHOP franchise reporting unit. | |
In accordance with U.S. GAAP, goodwill must be evaluated for impairment, at a minimum, on an annual basis, and more frequently if the Company believes indicators of impairment exist. Such indicators include, but are not limited to, events or circumstances such as a significant adverse change in the business climate, unanticipated competition, a loss of key personnel, adverse legal or regulatory developments, or a significant decline in the market price of the Company's common stock. In the process of the Company's annual impairment review, the Company primarily uses the income approach method of valuation that utilizes a discounted cash flow model to estimate the fair value of its reporting units. Significant assumptions used to determine fair value under the discounted cash flows model include future trends in sales, operating expenses, overhead expenses, depreciation, capital expenditures, and changes in working capital, along with an appropriate discount rate. | |
During the fiscal years ended 2014 and 2013, the Company made periodic assessments as to whether there were indicators of impairment, particularly with respect to the significant assumptions underlying the discounted cash flow model, and determined an interim test of goodwill was not warranted. Accordingly, the Company performed a quantitative test for impairment of goodwill of the Applebee's franchise reporting unit in the fourth quarter of 2014 and 2013. In the first step of each year's impairment test, the estimated fair value of the Applebee's franchising unit exceeded the carrying values and the Company concluded there was no impairment of goodwill. The Company performed a qualitative assessment of the goodwill of the IHOP franchise reporting unit and concluded there was no impairment of goodwill. |
Other_Intangible_Assets
Other Intangible Assets | 12 Months Ended | |||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||||||||||||||||||||||||||||
Other Intangible Assets | Other Intangible Assets | |||||||||||||||||||||||||||
As of December 31, 2014 and 2013, intangible assets were as follows: | ||||||||||||||||||||||||||||
Not Subject to Amortization | Subject to Amortization | |||||||||||||||||||||||||||
Tradename | Liquor | Other | Franchising | Recipes and | Leaseholds | Total | ||||||||||||||||||||||
Licenses | Rights | Menus | ||||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||
Balance at December 31, 2011 | $ | 652.4 | $ | 1.5 | $ | 0.5 | $ | 159.3 | $ | 6.6 | $ | 2.1 | $ | 822.4 | ||||||||||||||
Amortization expense | — | — | — | (10.0 | ) | (2.3 | ) | (0.2 | ) | (12.5 | ) | |||||||||||||||||
Refranchising | — | (1.5 | ) | (0.1 | ) | (0.3 | ) | — | (1.9 | ) | (3.8 | ) | ||||||||||||||||
Other | — | — | — | — | — | — | ||||||||||||||||||||||
Balance at December 31, 2012 | 652.4 | — | 0.4 | 149 | 4.3 | — | 806.1 | |||||||||||||||||||||
Amortization expense | — | — | — | (10.0 | ) | (2.3 | ) | — | (12.3 | ) | ||||||||||||||||||
Other | — | — | 0.3 | — | — | — | 0.3 | |||||||||||||||||||||
Balance at December 31, 2013 | 652.4 | — | 0.7 | 139 | 2 | — | 794.1 | |||||||||||||||||||||
Amortization expense | — | — | — | (10.0 | ) | (2.0 | ) | — | (12.0 | ) | ||||||||||||||||||
Other | — | — | 0.2 | — | — | — | 0.2 | |||||||||||||||||||||
Balance at December 31, 2014 | $ | 652.4 | $ | — | $ | 0.9 | $ | 129 | $ | — | $ | — | $ | 782.3 | ||||||||||||||
Annual amortization expense for the next five fiscal years is estimated to be approximately $10.0 million per year. The weighted average life of the intangible assets subject to amortization was 20 years at December 31, 2014 and 2013. | ||||||||||||||||||||||||||||
Gross and net carrying amounts of intangible assets subject to amortization at December 31, 2014 and 2013 are as follows: | ||||||||||||||||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||||||||||||||
Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||||
Amortization | Amortization | |||||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||
Franchising rights | $ | 200 | $ | (71.0 | ) | $ | 129 | $ | 200 | $ | (61.0 | ) | $ | 139 | ||||||||||||||
Recipes and menus | 15.7 | (15.7 | ) | — | 15.7 | (13.7 | ) | 2 | ||||||||||||||||||||
Leaseholds/other | 0.3 | (0.3 | ) | — | 0.3 | (0.3 | ) | — | ||||||||||||||||||||
Total | $ | 216 | $ | (87.0 | ) | $ | 129 | $ | 216 | $ | (75.0 | ) | $ | 141 | ||||||||||||||
Debt
Debt | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Debt | Long-Term Debt | |||||||
Long-term debt consists of the following components: | ||||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Series 2014-1 Class A-2 4.227% Fixed Rate Senior Secured Notes | $ | 1,300.00 | $ | — | ||||
Senior Secured Credit Facility, due October 2017, at a variable interest rate of 3.75% and 4.25% as of December 31, 2013 and 2012, respectively | — | 467.2 | ||||||
Senior Notes due October 2018, at a fixed rate of 9.5% | — | 760.8 | ||||||
Discount | — | (19.7 | ) | |||||
Total debt | 1,300.00 | 1,208.20 | ||||||
Less: current maturities | — | (4.7 | ) | |||||
Long-term debt | $ | 1,300.00 | $ | 1,203.50 | ||||
Long-Term Debt Outstanding at December 31, 2014 | ||||||||
On September 30, 2014, Applebee’s Funding LLC and IHOP Funding LLC (each a “Co-Issuer”), each a special purpose, wholly-owned indirect subsidiary of the Company issued $1.3 billion of Series 2014-1 4.277% Fixed Rate Senior Notes, Class A-2 (the “Class A-2 Notes”) in an offering exempt from registration under the Securities Act of 1933, as amended. The Co-Issuers also entered into a revolving financing facility of Series 2014-1 Variable Funding Senior Notes Class A-1 (the “Variable Funding Notes”), which allows for drawings of up to $100 million of Variable Funding Notes and the issuance of letters of credit. The Class A-2 Notes and the Variable Funding Notes are referred to collectively as the “Notes.” The Notes were issued in a securitization transaction pursuant to which substantially all of our domestic revenue-generating assets and our domestic intellectual property, are held by the Co-Issuers and certain other special-purpose, wholly-owned indirect subsidiaries of the Company (the “Guarantors”) that act as guarantors of the Notes and that have pledged substantially all of their assets to secure the Notes. | ||||||||
Class A-2 Notes | ||||||||
The Notes were issued under a Base Indenture, dated September 30, 2014 (the “Base Indenture”) and the related Series 2014-1 Supplement to the Base Indenture, dated September 30, 2014 (the “Series 2014-1 Supplement”), among the Co-Issuers and Citibank, N.A., as the trustee (in such capacity, the “Trustee”) and securities intermediary. The Base Indenture and the Series 2014-1 Supplement (collectively, the “Indenture”) will allow the Co-Issuers to issue additional series of notes in the future subject to certain conditions set forth therein. | ||||||||
While the Notes are outstanding, payment of principal and interest is required to be made on the Class A-2 Notes on a quarterly basis. The payment of principal on the Class A-2 Notes may be suspended when the leverage ratio for the Company and its subsidiaries is less than or equal to 5.25x. In general, the leverage ratio is our indebtedness (assuming all variable funding facilities are fully drawn) divided by adjusted EBITDA for the four preceding quarterly periods. As of December 31, 2014, the Company's leverage ratio was 4.8x; accordingly, no principal payment on the Class A-2 Notes was required. | ||||||||
The legal final maturity of the Class A-2 Notes is in September 2044, but it is anticipated that, unless earlier prepaid to the extent permitted under the Indenture, the Class A-2 Notes will be repaid in September 2021 (the “Class A-2 Anticipated Repayment Date”). If the Co-Issuers have not repaid or refinanced the Class A-2 Notes prior to the Class A-2 Anticipated Repayment Date, additional interest will accrue on the Class A-2 Notes equal to the greater of (i) 5.00% per annum and (ii) a per annum interest rate equal to the amount, if any, by which the sum of the following exceeds the Class A-2 Note interest rate: (A) the yield to maturity (adjusted to a quarterly bond-equivalent basis) on the Class A-2 Anticipated Repayment Date of the United States Treasury Security having a term closest to 10 years plus (B) 5.00% plus (C) 2.150%. | ||||||||
The Notes are secured by the collateral described below under “Guarantees and Collateral.” | ||||||||
Variable Funding Notes | ||||||||
In connection with the issuance of the Class A-2 Notes, the Co-Issuers also entered into a revolving financing facility that allows for the drawings of up to $100 million of Variable Funding Notes and the issuance of letters of credit. The Variable Funding Notes were issued under the Indenture and allow for drawings on a revolving basis. Drawings and certain additional terms related to the Variable Funding Notes are governed by the Class A-1 Note Purchase Agreement dated as of September 30, 2014 (the “Variable Funding Note Purchase Agreement”), among the Co-Issuers, the Guarantors , certain conduit investors, financial institutions and funding agents, and Cooperatieve Centrale Raiffeisen-Boerenleenbank, B.A. (“Rabobank Nederdland”), New York Branch, as provider of letters of credit, as swingline lender and as administrative agent. | ||||||||
The Variable Funding Notes will be governed, in part, by the Variable Funding Note Purchase Agreement and by certain generally applicable terms contained in the Indenture. Depending on the type of borrowing by the Co-Issuers, the applicable interest rate under the Variable Funding Notes is calculated at a per annum rate equal to (a) LIBOR plus 2.50%, (b) (i) the greatest of (x) the prime rate, (y) the federal funds effective rate plus 0.50% or (z) a daily rate equal to one month LIBOR plus 0.5% plus (ii) 2.00% or (c) the lenders’ commercial paper funding rate plus 2.50%. There is a scaled commitment fee based on the unused portion of the Variable Funding Notes facility of between 50 to 100 basis points. It is anticipated that the principal and interest on the Variable Funding Notes will be repaid in full on or prior to September 2019 (the “VFN Anticipated Repayment Date”), subject to two additional one-year extensions at the option of the Company, which acts as the manager (as described below), upon the satisfaction of certain conditions. Following the VFN Anticipated Repayment Date (and any extensions thereof), additional interest will accrue on the Variable Funding Notes equal to 5.00% per annum. The Variable Funding Notes and other credit instruments issued under the Variable Funding Note Purchase Agreement are secured by the collateral described below under “Guarantees and Collateral.” | ||||||||
The Company did not draw on the Variable Funding Notes during 2014. As of December 31, 2014 there were no amounts outstanding under the Revolving Facility; however, available borrowing capacity under the Variable Funding Notes was reduced by $9.6 million of letters of credit outstanding as of December 31, 2014. | ||||||||
Guarantees and Collateral | ||||||||
Under the Guarantee and Collateral Agreement dated September 30, 2014 (the “Guarantee and Collateral Agreement”), among the Guarantors in favor of the Trustee, the Guarantors guarantee the obligations of the Co-Issuers under the Indenture and related documents and secure the guarantee by granting a security interest in substantially all of their assets. | ||||||||
The Notes are secured by a security interest in substantially all of the assets of the Co-Issuers and the Guarantors (collectively, the “Securitization Entities”). On September 30, 2014, these assets (the “Securitized Assets”) generally included substantially all of the domestic revenue-generating assets of the Corporation and its subsidiaries, which principally consist of franchise agreements, area license agreements, development agreements, franchisee fee notes, equipment leases, agreements related to the production and sale of pancake and waffle dry-mixes, owned and leased real property and intellectual property. | ||||||||
The Notes are obligations only of the Co-Issuers pursuant to the Indenture and are unconditionally and irrevocably guaranteed by the Guarantors pursuant to the Guarantee and Collateral Agreement. Except as described below, neither we nor any of our subsidiaries, other than the Securitization Entities, will guarantee or in any way be liable for the obligations of the Co-Issuers under the Indenture or the Notes. | ||||||||
Covenants and Restrictions | ||||||||
The Notes are subject to a series of covenants and restrictions customary for transactions of this type, including (i) that the Co-Issuers maintain specified reserve accounts to be used to make required payments in respect of the Notes, (ii) provisions relating to optional and mandatory prepayments, and the related payment of specified amounts, including specified make-whole payments in the case of the Class A-2 Notes under certain circumstances, (iii) certain indemnification payments in the event, among other things, the transfers of the assets pledged as collateral for the Notes are in stated ways defective or ineffective and (iv) covenants relating to recordkeeping, access to information and similar matters. The Notes are also subject to customary rapid amortization events provided for in the Indenture, including events tied to failure of the Securitization Entities to maintain the stated debt service coverage (“DSCR”) ratio, the sum of domestic retail sales for all restaurants being below certain levels on certain measurement dates, certain manager termination events, certain events of default and the failure to repay or refinance the Notes on the Class A-2 Anticipated Repayment Date. The Notes are also subject to certain customary events of default, including events relating to non-payment of required interest, principal or other amounts due on or with respect to the Notes, failure of the Securitization Entities to maintain the stated debt service coverage ratio, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties and certain judgments. | ||||||||
The DSCR ratio is Net Cash Flow for the four quarters preceding the calculation date divided by the total debt service payments of the preceding four quarters. Failure to maintain a prescribed DSCR ratio can trigger a Cash Trapping Event, A Rapid Amortization Event, a Manager Termination Event or a Default Event as described below. In a Cash Trapping Event, the Trustee is required to retain a certain percentage of cash flow in a restricted account. In a Rapid Amortization Event, all excess Cash Flow is retained and used to retire principal amounts of debt. Key DSCR ratios are as follows: | ||||||||
•DSCR less than 1.75x but equal to or greater than 1.50x - Cash Trapping Event, 50% of Net Cash Flow | ||||||||
•DSCR less than 1.50x - Cash Trapping Event, 100% of Net Cash Flow | ||||||||
•DSCR less than 1.30x - Rapid Amortization Event | ||||||||
•DSCR less than 1.20x - Manager Termination Event | ||||||||
•DSCR less than 1.10x - Default Event | ||||||||
The DSCR for the reporting period ended December 31, 2014 was 4.9x. | ||||||||
Deferred Financing Costs | ||||||||
The Company incurred costs of approximately $24.3 million in connection with the issuance of the Notes. These deferred financing costs will be amortized using the effective interest method over estimated life of the Notes. Amortization of these deferred financing costs of $0.8 million was included in interest expense for the year ended December 31, 2014. Unamortized deferred financing costs of $23.5 million was included as other non-current assets, net in the consolidated balance sheet as of December 31, 2014. | ||||||||
Weighted Average Effective Interest Rate | ||||||||
Taking into account the deferred financing costs that were amortized as additional non-cash interest expense, the weighted average effective interest rate for the Notes as of December 31, 2014 was 4.45%. | ||||||||
Maturities of Long-term Debt | ||||||||
The Class A-2 Anticipated Repayment Date is in September 2021. | ||||||||
Long-Term Debt Outstanding at December 31, 2013 | ||||||||
Senior Secured Credit Facility | ||||||||
On October 8, 2010, the Company entered into a Credit Agreement, by and among the Company, a group of lenders and other financial institutions party thereto (the “Credit Agreement”). The Credit Agreement established a senior secured credit facility (the “Credit Facility”) that consisted of a $900.0 million senior secured term loan facility maturing in October 2017 (the “Term Facility”) and a $50.0 million senior secured revolving credit facility maturing in October 2015 (the “Revolving Facility”). The Revolving Facility originally provided for borrowings up to $50.0 million, with sub-limits for the issuance of letters of credit and for swing-line borrowings, and could be used for general corporate purposes, including working capital, permitted acquisitions, capital expenditures, dividends and investments. The Credit Agreement also provided for an uncommitted incremental facility that permitted the Company, subject to certain conditions, to increase the Credit Facility by up to $250.0 million, provided that the aggregate amount of the commitments under the Revolving Facility did not exceed $150.0 million. See “Amendments to Credit Agreement”. The Company did not utilize the Revolving Facility during 2014 or 2013. On September 30, 2014, the Company repaid the entire outstanding principal balance of $463.6 million of the Credit Facility. See “2014 Refinancing of Long-term Debt.” | ||||||||
Interest Rate | ||||||||
Loans made under the Term Facility (“Term Loans”) and the Revolving Facility (“Revolving Loans”) bore interest, at the Company's option, at an annual rate equal to (i) a LIBOR-based rate (originally subject to a floor of 1.50%) plus a margin (originally 4.50%) or (ii) the base rate (the “Base Rate”) (originally subject to a floor of 2.50%) which was equal to the highest of (a) the federal funds rate plus 0.50%, (b) the prime rate and (c) the one month LIBOR rate (originally subject to a floor of 1.50%) plus 1.00%, plus a margin of 3.50%. The margin for the Revolving Facility was subject to debt leverage-based step-downs. Both the Term Facility and the Revolving Facility were subject to upfront fees of 1.00% of the principal amount thereof. See “Amendments to Credit Agreement”. | ||||||||
Amendments to Credit Agreement | ||||||||
On February 25, 2011, the Company entered into Amendment No. 1 (“Amendment No. 1”) to the Credit Agreement. Pursuant to Amendment No. 1, the interest rate margin applicable to LIBOR-based Term Loans was reduced from 4.50% to 3.00%, and the interest rate floors used to determine the LIBOR and Base Rate reference rates for Term Loans was reduced from 1.50% to 1.25% for LIBOR-based Term Loans and from 2.50% to 2.25% for Base Rate-denominated Term Loans. In addition, Amendment No. 1 increased the lender commitments under the Revolving Facility from $50.0 million to $75.0 million. Amendment No. 1 also modified certain restrictive covenants of the Credit Agreement, including those relating to repurchases of other debt securities, permitted acquisitions and payments on equity. | ||||||||
The Company paid $12.3 million in fees and costs related to Amendment No. 1, of which $7.4 million in fees paid to lenders was recorded as additional discount on debt and $0.8 million of costs related to the increase in the Revolving Facility was recorded as deferred financing costs. Fees paid to third parties of $4.0 million were charged against income. | ||||||||
On February 4, 2013, the Company entered into Amendment No. 2 (“Amendment No. 2”) to the Credit Agreement. Pursuant to Amendment No. 2, the interest rate margin applicable to LIBOR-based Term Loans was reduced from 3.00% to 2.75%, and the interest rate floors used to determine the LIBOR and Base Rate reference rates for Term Loans was reduced from 1.25% to 1.00% for LIBOR-based Term Loans and from 2.25% to 2.00% for Base Rate-denominated Term Loans. The interest rate margin for Revolving Loans was reduced from 3.50% to 1.75% for Base Rate loans and from 4.50% to 2.75% LIBOR Rate loans. The commitment fee for the unused portion of the Revolving Facility was reduced from 0.75% to 0.50% and, if the consolidated leverage ratio was reduced below 4.75:1, from 0.50% to 0.375%. | ||||||||
In addition, Amendment No. 2 established the following consolidated leverage ratio thresholds for excess cash flow prepayments: 50% if the consolidated leverage ratio is 5.75:1 or greater; 25% if the consolidated leverage ratio is less than 5.75:1 and greater than or equal to 5.25:1; and 0% if the consolidated leverage ratio is less than 5.25:1. | ||||||||
Amendment No. 2 revised the definition of excess cash flow to eliminate the deduction for any extraordinary receipts or disposition proceeds. Finally, Amendment No. 2 revised the definition of certain permitted payments so that the calculation of allowable restricted payments is performed on a quarterly basis instead of an annual basis that was required prior to Amendment No. 2. All other material provisions, including maturity and covenants under the Credit Agreement, remain unchanged. | ||||||||
Fees of $1.3 million paid to third parties in connection with Amendment No. 2 were included as “Debt modification costs” in the Consolidated Statement of Comprehensive Income for the year ended December 31, 2013. | ||||||||
Guarantees | ||||||||
The loans made under the Credit Agreement were guaranteed by the Company's domestic wholly-owned restricted subsidiaries, other than immaterial subsidiaries (the “Prior Guarantors”), and were secured by a perfected first priority security interest in substantially all of the tangible and intangible assets of the Company and the Prior Guarantors, including, without limitation, (i) substantially all personal, real and mixed property, (ii) all intercompany debt owing to the Company and the Prior Guarantors and (iii) 100% of the equity interests held by the Company and each of the Prior Guarantors (with customary limits for foreign subsidiaries), subject to certain customary exceptions. | ||||||||
Mandatory Prepayments | ||||||||
Term Loans under the Credit Agreement were subject to the following prepayment requirements: | ||||||||
• | Mandatory prepayments equal to 0.25% of the aggregate principal amount of the New Term Loan had to be made on a quarterly basis (1.0% for a fiscal year); and | |||||||
• | 50% of excess cash flow (as defined in the Credit Agreement or amendments thereto) if the consolidated leverage ratio is 5.75:1 or greater; 25% if the consolidated leverage ratio is less than 5.75:1 and greater than or equal to 5.25:1; and 0% if the consolidated leverage ratio is less than 5.25:1. | |||||||
The Credit Agreement permitted the Company to purchase loans under the Term Facility pursuant to customary Dutch auction provisions and subject to customary conditions and limitations. | ||||||||
Covenants/Restrictions | ||||||||
The Credit Agreement required the Company to comply with certain financial covenants, including a minimum consolidated interest coverage ratio and a maximum consolidated leverage ratio, in each case, commencing with the fiscal quarter ending March 31, 2011. The Credit Agreement also included certain negative covenants customary for transactions of this type, that restricted the ability of the Company and the Company's existing and future restricted subsidiaries to, among other things, modify material agreements and/or incur additional debt, incur liens, make certain investments and acquisitions, make fundamental changes, transfer and sell assets, pay dividends and make distributions, modify the nature of the Company's business, enter into agreements with shareholders and affiliates, enter into burdensome agreements, change the Company's fiscal year, make capital expenditures and prepay certain indebtedness, subject to certain customary exceptions, including carve-outs and baskets. | ||||||||
The Credit Agreement contained certain customary representations and warranties, affirmative covenants and events of default, including change of control provisions and cross-defaults to other debt. Upon the occurrence of an event of default, the lenders, by a majority vote, had the ability to direct the Administrative Agent to terminate the loan commitments, accelerate all loans and exercise any of the lenders' other rights under the Credit Agreement and the related loan documents on behalf of the lenders. | ||||||||
9.5% Senior Notes due 2018 | ||||||||
On October 19, 2010, the Company issued $825.0 million aggregate principal amount of its 9.5% Senior Notes due October 30, 2018 (the “Senior Notes”) pursuant to an Indenture (the “Senior Note Indenture”), by and among the Company, the Guarantors and Wells Fargo Bank, National Association, as trustee (the “Trustee”). The Senior Notes were unsecured senior obligations of the Company and were jointly and severally guaranteed on a senior unsecured basis by the Guarantors under the Credit Agreement. The Senior Notes were repaid on October 30, 2014. See “2014 Refinancing of Long-term Debt.” | ||||||||
Prepayment | ||||||||
The Company could redeem the Senior Notes for cash in whole or in part, at any time or from time to time, on and after October 30, 2014, at specified redemption premiums, plus accrued and unpaid interest, as specified in the Indenture. In addition, prior to October 30, 2014, the Company could redeem the Senior Notes for cash in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest and a “make-whole” premium, as specified in the Indenture. The make-whole payment was $36.1 million as of October 30, 2014. | ||||||||
In addition, prior to October 30, 2013, the Company could redeem up to 35% of the aggregate principal amount of Senior Notes issued with the net proceeds raised in one or more equity offerings. If the Company underwent a change of control under certain circumstances, the Company could have been required to offer to purchase the Senior Notes at a purchase price equal to 101% of the principal amount plus accrued and unpaid interest. If the Company sells assets under certain circumstances, the Company could have been required to offer to purchase the Senior Notes at a purchase price equal to 100% of the principal amount plus accrued and unpaid interest. | ||||||||
Covenants/Restrictions | ||||||||
The Senior Note Indenture limited the ability of the Company and its restricted subsidiaries to incur additional indebtedness (excluding certain indebtedness under the Credit Facility), issue certain preferred shares, pay dividends and make other equity distributions, purchase or redeem capital stock, make certain investments, create certain liens on its assets to secure certain debt, enter into certain transactions with affiliates, agree to any restrictions on the ability of the Company's restricted subsidiaries to make payments to the Company, merge or consolidate with another company, transfer and sell assets, engage in business other than certain permitted businesses and designate its subsidiaries as unrestricted subsidiaries, in each case as set forth in the Senior Note Indenture. These covenants were subject to a number of important limitations, qualifications and exceptions, including that during any time that the Notes maintain investment grade ratings, certain of these covenants will not be applicable to the Notes. | ||||||||
The Senior Note Indenture also contained customary event of default provisions including, among others, the following: default in the payment of the principal of the Notes when the same becomes due and payable; default for 30 days in the payment when due of interest on the Notes; failure to comply with certain covenants in the Indenture, in some cases without notice from the Trustee or the holders of Notes; and certain events of bankruptcy or insolvency with respect to the Company or any significant restricted subsidiary, in each case as set forth in the Senior Note Indenture. In the case of an event of default, other than a bankruptcy default with respect to the Company, the Trustee or the holders of at least 25% in aggregate principal amount of the Notes then outstanding, by written notice to the Company (and to the Trustee if the notice is given by the holders of the Notes), could, and the Trustee at the written request of the holders of at least 25% in aggregate principal amount of the Notes then outstanding would, declare the principal of and accrued interest on the Notes to be immediately due and payable. | ||||||||
Restricted Payments | ||||||||
The Credit Agreement contained covenants considered customary for similar types of facilities that limit certain permitted restricted payments, including those related to dividends on and repurchases of our common stock. Such restricted payments were limited to a cumulative amount comprised of (i) a general restricted payments allowance of $35.0 million, plus (ii) 50% of Excess Cash Flow for each fiscal quarter in which the consolidated leverage ratio is greater than 5.75:1; (iii) 75% of Excess Cash Flow for each fiscal quarter if the consolidated leverage ratio is less than 5.75:1 and greater than or equal to 5.25:1; (iv) 100% of Excess Cash Flow for each fiscal quarter in which the consolidated leverage ratio is less than 5.25:1; and (v) proceeds from the exercise of options to purchase our common stock, less any amounts paid as dividends or to repurchase our common stock. | ||||||||
The Senior Note Indenture also contained a limitation on restricted payments that is calculated on an annual basis. Such restricted payments were limited to a cumulative amount comprised of (i) 50% of consolidated net income (as defined in the Indenture), plus (ii) proceeds from exercise of stock options, less (iii) restricted payments made. | ||||||||
Deferred Financing Costs | ||||||||
In connection with the Credit Agreement and the issuance of the Senior Notes, the Company recorded approximately $28.2 million of deferred financing costs. In connection with the increase to the Revolving Credit Facility, the Company recorded an additional $0.8 million of deferred financing costs. These deferred financing costs are being amortized using the effective interest method over the estimated life of the related debt. Amortization of the deferred financing costs associated with the Credit Agreement and the issuance of the Senior Notes included in interest expense for the years ended December 31, 2014, 2013 and 2012 was $2.2 million, $2.7 million and $2.6 million, respectively. Additionally, $2.3 million of deferred issuance costs were written off in connection with debt retirement for the year ended December 31, 2012 and is reflected in the loss on extinguishment of debt in the Consolidated Statements of Comprehensive Income. | ||||||||
As of December 31, 2013, $14.0 million of deferred financing costs associated with the Credit Agreement and the issuance of the Senior Notes was reported as other non-current assets, net in the Consolidated Balance Sheets. | ||||||||
Discount on Debt | ||||||||
The Company recorded a discount on debt from the October 2010 Refinancing of $29.6 million. In connection with Amendment No. 1, the Company recorded an additional discount of $7.4 million. The discount on debt reflected the difference between the proceeds received from the issuance of the debt and the face amount to be repaid over the life of the debt. The discount will be amortized as additional interest expense over the weighted average estimated life of the debt under the effective interest method. For the years ended December 31, 2014, 2013, and 2012, $2.8 million, $3.5 million and $3.4 million, respectively, of the discount was amortized as additional interest expense under the effective interest method. Additionally, $2.7 million was written off in connection with debt retirement for the year ended December 31, 2012 and was reflected in the loss on extinguishment of debt in the Consolidated Statements of Comprehensive Income. | ||||||||
2014 Refinancing of Long-term Debt | ||||||||
On September 30, 2014, the Company repaid the entire outstanding principal balance of $463.6 million of the Credit Facility; there were no premiums or penalties associated with the repayment. On October 30, 2014, after a required 30-day notice period, the Company repaid the entire outstanding $760.8 million principal balance of Senior Notes, along with a required make-whole premium for early repayment of $36.1 million. All of our obligations under the Credit Facility and the Senior Notes terminated upon the respective repayments thereof. | ||||||||
This transaction was accounted for as an extinguishment of debt under U.S. GAAP. We recognized a loss on debt extinguishment of $64.9 million for the year ended December 31, 2014, comprised of the $36.1 million make-whole premium on the Senior Notes and the write-off of the unamortized debt discount and the issuance costs associated with the extinguished debt of $16.9 million and $11.9 million, respectively. |
Financing_Obligations
Financing Obligations | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Financing Obligations [Abstract] | ||||
Financing Obligations | Financing Obligations | |||
On May 19, 2008, the Company entered into a Purchase and Sale Agreement relating to the sale and leaseback of 181 parcels of real property (the “Sale-Leaseback Transaction”), each of which is improved with a restaurant operating as an Applebee's Neighborhood Grill and Bar (the “Properties”). On June 13, 2008, the closing date of the Sale-Leaseback Transaction, the Company entered into a Master Land and Building Lease (“Master Lease”) for the Properties. The proceeds received from the transaction were $337.2 million. The Master Lease calls for an initial term of twenty years and four, five-year options to extend the term. | ||||
The Company has an ongoing obligation related to the Properties until such time as the lease related to each of the Properties is assigned to a qualified franchisee in a transaction meeting certain parameters set forth in the Master Lease. Due to this continuing involvement, the Sale-Leaseback Transaction was recorded under the financing method in accordance with U.S. GAAP. Accordingly, the value of the land and leasehold improvements will remain on the Company's books and the leasehold improvements will continue to be depreciated over their remaining useful lives. The net proceeds received were recorded as a financing obligation. A portion of the lease payments is recorded as a decrease to the financing obligation and a portion is recognized as interest expense. In the event the lease obligation of any individual property or group of properties is assumed by a qualified franchisee, the Company's continuing involvement will cease. At that time, that portion of the transaction related to that property or group of properties is expected to be recorded as a sale in accordance with U.S. GAAP and the net book value of those properties will be removed from the Company's books, along with a ratable portion of the remaining financing obligation. | ||||
As of December 31, 2014, the Company's continuing involvement with 152 of the 181 Properties ended by assignment of the lease obligation to a qualified franchisee or a release from the lessor. In accordance with the accounting described above, the transactions related to these properties have been recorded as a sale with property and equipment and financing obligations each cumulatively reduced by approximately $270.6 million. | ||||
As of December 31, 2014, future minimum lease payments under financing obligations during the initial terms of the leases related to the sale-leaseback transactions are as follows: | ||||
Fiscal Years | (In millions) | |||
2015 (1) | $ | 5.4 | ||
2016 | 5 | |||
2017 (1) | 4.6 | |||
2018 | 5.2 | |||
2019 | 5.5 | |||
Thereafter | 75.8 | |||
Total minimum lease payments | 101.5 | |||
Less: interest | (58.8 | ) | ||
Total financing obligations | 42.7 | |||
Less: current portion(2) | (0.1 | ) | ||
Long-term financing obligations | $ | 42.6 | ||
____________________________________________________________________________________ | ||||
(1) | Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in fiscal 2015 and 11 monthly payments in fiscal 2017. | |||
(2) | Included in current maturities of capital lease and financing obligations on the consolidated balance sheet. |
Leases
Leases | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Leases [Abstract] | ||||||||
Leases | Leases | |||||||
The Company is the lessor or sub-lessor of approximately half of all IHOP franchise restaurants. The restaurants are subleased to IHOP franchisees or in a few instances operated by the Company. These noncancelable leases and subleases consist primarily of land, buildings and improvements. | ||||||||
The following is the Company's net investment in direct financing lease receivables: | ||||||||
December 31, | ||||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Total minimum rents receivable | $ | 126.7 | $ | 144.8 | ||||
Less: unearned income | (45.1 | ) | (56.2 | ) | ||||
Net investment in direct financing lease receivables | 81.6 | 88.6 | ||||||
Less: current portion | (8.0 | ) | (7.0 | ) | ||||
Long-term direct financing lease receivables | $ | 73.6 | $ | 81.6 | ||||
Contingent rental income, which is the amount above and beyond base rent, for the years ended December 31, 2014, 2013 and 2012 was $14.1 million, $12.7 million and $12.5 million, respectively. | ||||||||
The following is the Company's net investment in equipment leases receivable: | ||||||||
December 31, | ||||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Total minimum leases receivable | $ | 165.4 | $ | 184.2 | ||||
Less: unearned income | (58.1 | ) | (69.1 | ) | ||||
Net investment in equipment leases receivables | 107.3 | 115.1 | ||||||
Less: current portion | (7.4 | ) | (7.1 | ) | ||||
Long-term equipment leases receivable | $ | 99.9 | $ | 108 | ||||
The following are minimum future lease payments on noncancelable leases as lessee at December 31, 2014: | ||||||||
Capital | Operating | |||||||
Leases | Leases | |||||||
(In millions) | ||||||||
2015 (1) | $ | 26.2 | $ | 83.5 | ||||
2016 | 24 | 75.9 | ||||||
2017 (1) | 21.4 | 68.4 | ||||||
2018 | 20.6 | 72.6 | ||||||
2019 | 17.2 | 68.4 | ||||||
Thereafter | 58.7 | 328.5 | ||||||
Total minimum lease payments | 168.1 | $ | 697.3 | |||||
Less: interest | (55.3 | ) | ||||||
Capital lease obligations | 112.8 | |||||||
Less: current portion (2) | (14.7 | ) | ||||||
Long-term capital lease obligations | $ | 98.1 | ||||||
______________________________________________________ | ||||||||
(1) Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in fiscal 2015 and 11 monthly payments in fiscal 2017. | ||||||||
(2) Included in current maturities of capital lease and financing obligations on the consolidated balance sheet. | ||||||||
The asset cost and carrying amount on company-owned property leased at December 31, 2014 was $90.1 million and $64.5 million, respectively. The asset cost and carrying amount on company-owned property leased at December 31, 2013, was $90.1 million and $66.1 million, respectively. The asset cost and carrying amounts represent the land and building asset values and net book values on sites leased to franchisees. | ||||||||
The minimum future lease payments shown above have not been reduced by the following future minimum rents to be received on noncancelable subleases and leases of owned property at December 31, 2014: | ||||||||
Direct | Operating | |||||||
Financing | Leases | |||||||
Leases | ||||||||
(In millions) | ||||||||
2015 (1) | $ | 18.3 | $ | 101.5 | ||||
2016 | 17.8 | 99.7 | ||||||
2017 (1) | 17.9 | 99.6 | ||||||
2018 | 17.5 | 98.9 | ||||||
2019 | 16.3 | 97.1 | ||||||
Thereafter | 38.9 | 555.8 | ||||||
Total minimum rents receivable | $ | 126.7 | $ | 1,052.60 | ||||
________________________________________________________________________ | ||||||||
(1) Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in fiscal 2015 and 11 monthly payments in fiscal 2017. | ||||||||
The Company has noncancelable leases, expiring at various dates through 2032, which require payment of contingent rents based upon a percentage of sales of the related restaurant as well as property taxes, insurance and other charges. Subleases to franchisees of properties under such leases are generally for the full term of the lease obligation at rents that include the Company's obligations for property taxes, insurance, contingent rents and other charges. Generally, the noncancelable leases include renewal options. Contingent rent expense for all noncancelable leases for the years ended December 31, 2014, 2013 and 2012 was $2.8 million, $2.8 million and $2.7 million, respectively. Minimum rent expense for all noncancelable operating leases for the years ended December 31, 2014, 2013 and 2012 was $75.9 million, $75.4 million and $78.0 million, respectively. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies |
Purchase Commitments | |
In some instances, the Company enters into commitments to purchase advertising and other items. Most of these agreements are fixed price purchase commitments. At December 31, 2014, the outstanding purchase commitments were $108.4 million, the majority of which related to advertising. | |
Lease Guarantees | |
In connection with the sale of Applebee's restaurants to franchisees and other parties, the Company has, in certain cases, guaranteed or had potential continuing liability for lease payments. As of December 31, 2014 and 2013, the Company has outstanding lease guarantees or is contingently liable for approximately $378.1 million and $417.8 million, respectively. This amount represents the maximum potential liability of future payments under these leases. These leases have been assigned to the buyers and expire at the end of the respective lease terms, which range from 2014 through 2048. In the event of default, the indemnity and default clauses in our sale or assignment agreements govern our ability to pursue and recover damages incurred. No material liabilities have been recorded as of December 31, 2014. | |
Litigation, Claims and Disputes | |
The Company is subject to various lawsuits, governmental inspections, administrative proceedings, audits, and claims arising in the ordinary course of business. Some of these lawsuits purport to be class actions and/or seek substantial damages. The Company is required to record an accrual for litigation loss contingencies that are both probable and reasonably estimable. Legal fees and expenses associated with the defense of all of the Company's litigation are expensed as such fees and expenses are incurred. In the opinion of management, these matters are adequately covered by insurance or, if not so covered, are without merit or are of such a nature or involve amounts that would not have a material adverse impact on the Company's business or consolidated financial statements. Management regularly assesses the Company's insurance deductibles, analyzes litigation information with the Company's attorneys and evaluates its loss experience in connection with pending legal proceedings. While the Company does not presently believe that any of the legal proceedings to which the Company is currently a party will ultimately have a material adverse impact on the Company, there can be no assurance that the Company will prevail in all the proceedings the Company is party to, or that the Company will not incur material losses from them. | |
Letters of Credit | |
The Company provides letters of credit, primarily to various insurance carriers to collateralize obligations for outstanding claims. As of December 31, 2014, the Company had approximately $9.6 million of unused letters of credit outstanding. These letters expire on various dates in 2015 and are automatically renewed for an additional year if no cancellation notice is submitted. |
Preferred_Stock_and_Stockholde
Preferred Stock and Stockholders' Equity | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Preferred Stock and Stockholders' Equity [Abstract] | ||||||||||||
Preferred Stock and Stockholders' Equity | Stockholders' Equity | |||||||||||
Preferred Stock | ||||||||||||
Series B Convertible Preferred Stock | ||||||||||||
On November 29, 2007, the Company issued and sold 35,000 shares of Series B Convertible Preferred Stock for an aggregate purchase price of $35.0 million in cash. Total issuance costs were approximately $0.8 million. All of the shares were sold to affiliates of Chilton Investment Company, LLC (collectively, “Chilton”) pursuant to a purchase agreement dated as of July 15, 2007. The shares of Series B Convertible Preferred Stock ranked (i) senior to the common stock, and any series of preferred stock specifically designated as junior to the Series B Convertible Preferred Stock, with respect to the payment of dividends and distributions, in a liquidation, dissolution or winding up, and upon any other distribution of the Company's assets; and (ii) on a parity with all other series of preferred stock, with respect to the payment of dividends and distributions, in a liquidation, dissolution or winding up, and upon any other distribution of the Company's assets. | ||||||||||||
Each share of Series B Convertible Preferred Stock had an initial stated value of $1,000, that increased at the rate of 6.0% per annum, compounded quarterly, commencing on the issue date of such share of Series B Convertible Preferred Stock to and including the earlier of (i) the date of liquidation, dissolution or winding up or the redemption of such share, or (ii) the date such share is converted into the Company's common stock. The stated value of a share as so accreted as of any date was referred to as the accreted value of the share as of that date. The Series B Convertible Preferred Stock entitled the holders thereof to receive certain dividends and distributions to the extent that any dividends or distributions paid on the Company's common stock exceeded the annual accretion on the Series B Convertible Preferred Stock. Holders of Series B Convertible Preferred Stock were entitled to vote on all matters (including the election of directors) submitted to the holders of the Company's common stock, as a single class with the holders of the Company's common stock, with each share of Series B Convertible Preferred Stock having one vote per share of the Company's common stock then issuable upon conversion of such share of Series B Convertible Preferred Stock. | ||||||||||||
At any time and from time to time, any holder of Series B Convertible Preferred Stock could convert all or any portion of the Series B Convertible Stock held by such holder into a number of shares of the Company's common stock computed by multiplying (i) each $1,000 of aggregate accreted value of the shares to be converted by (ii) the conversion rate then in effect (which initially was 14.44878 shares of common stock per $1,000 of accreted value, but subject to customary anti-dilution adjustments). | ||||||||||||
The Company also entered into a registration rights agreement, dated as of November 29, 2007, with Chilton pursuant to which the Company granted Chilton certain registration rights with respect to the shares of Series B Convertible Preferred Stock issued to Chilton and the shares of common stock issuable upon conversion. | ||||||||||||
In January 2011, 100 shares of Series B Convertible Preferred Stock with an accreted value of approximately $120,000 were converted by the holder into 1,737 shares of the Company's common stock. On November 29, 2012, the fifth anniversary of the issue date, the remaining 34,900 outstanding shares of Series B Convertible Preferred Stock, with an accreted value of approximately $47.0 million, were automatically converted into 679,168 shares of the Company's common stock. | ||||||||||||
On December 14, 2012, the Company filed a Certificate of Elimination of the Series B Convertible Preferred Stock with the Secretary of State of the State of Delaware to eliminate its Series B Convertible Preferred Stock. The Certificate of Elimination, effective upon filing, had the effect of eliminating from the Corporation’s Restated Certificate of Incorporation, as amended, all matters set forth in the Certificate of Designations of the Series B Preferred Stock with respect to such series, which was previously filed by the Corporation with the Secretary of State on November 29, 2007. | ||||||||||||
Stock Repurchase Programs | ||||||||||||
On February 26, 2013, the Company's Board of Directors approved a stock repurchase authorization of up to $100 million of DineEquity common stock (the “2013 Authorization”). On October 27, 2014, the Company's Board of Directors approved increasing the share repurchase authorization back to the previous level of $100 million (the “2014 Authorization”). During the year ended December 31, 2014, the Company purchased 367,256 shares of our common stock under the 2013 authorization for a total of $30.0 million and 20,335 shares under the 2014 Authorization for a total of $2.0 million. The Company may repurchase up to an additional $98.0 million of our common stock under the 2014 Authorization. | ||||||||||||
During the year ended December 31, 2013, the Company repurchased 412,022 shares of stock for $29.7 million. There were no stock repurchases in 2012. | ||||||||||||
Treasury Stock | ||||||||||||
Repurchases of DineEquity common stock are included in treasury stock at the cost of shares repurchased plus any transaction costs. Treasury stock may be re-issued when vested stock options are exercised, when restricted stock awards are granted and when restricted stock units settle in stock upon vesting. The cost of treasury stock re-issued is determined on the first-in, first-out (“FIFO”) method. The Company re-issued 359,528 shares, 318,644 shares and 433,732 shares, respectively, during the years ended December 31, 2014, 2013 and 2012 at a total FIFO cost of $13.0 million, $11.7 million and $14.1 million, respectively. | ||||||||||||
Dividends | ||||||||||||
During the fiscal years ended December 31, 2014 and 2013, the Company declared and paid dividends on our common stock as follows: | ||||||||||||
Year ended December 31, 2014 | Declaration date | Payment date | Dividend per share | Total(1) | ||||||||
(In millions) | ||||||||||||
First quarter | 25-Feb-14 | 28-Mar-14 | $ | 0.75 | $ | 14.3 | ||||||
Second quarter | 28-May-14 | 27-Jun-14 | 0.75 | 14.3 | ||||||||
Third quarter | 4-Aug-14 | 26-Sep-14 | 0.75 | 14.2 | ||||||||
Fourth quarter | 27-Oct-14 | -2 | 0.875 | — | ||||||||
Total | $ | 3.125 | $ | 42.8 | ||||||||
Year ended December 31, 2013 | ||||||||||||
First quarter | 26-Feb-13 | 29-Mar-13 | $ | 0.75 | $ | 14.6 | ||||||
Second quarter | 14-May-13 | 28-Jun-13 | 0.75 | 14.4 | ||||||||
Third quarter | 2-Aug-13 | 27-Sep-13 | 0.75 | 14.3 | ||||||||
Fourth quarter | 3-Oct-13 | 27-Dec-13 | 0.75 | 14.3 | ||||||||
Total | $ | 3 | $ | 57.6 | ||||||||
___________________________________________________ | ||||||||||||
(1) Includes dividend equivalents paid on restricted stock units | ||||||||||||
(2) The fourth quarter 2014 dividend of $16.6 million was paid on January 9, 2015. | ||||||||||||
On February 24, 2015, the Company's Board of Directors approved payment of a cash dividend of $0.875 per share of common stock, payable at the close of business on April 10, 2015 to the stockholders of record as of the close of business on March 13, 2015. | ||||||||||||
There were no dividends declared or paid on common shares in 2012. |
Closure_and_Impairment_Charges
Closure and Impairment Charges | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Impairments and Closure Charges [Abstract] | ||||||||||||
Closure and Impairment Charges | Closure and Impairment Charges | |||||||||||
Closure and impairment charges for the years ended December 31, 2014, 2013 and 2012 were as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(In millions) | ||||||||||||
Closure charges | $ | 2.1 | $ | 1 | $ | 2.3 | ||||||
Long-lived tangible asset impairment | 1.6 | 0.8 | 1.9 | |||||||||
Total closure and impairment charges | $ | 3.7 | $ | 1.8 | $ | 4.2 | ||||||
Closure Charges | ||||||||||||
Approximately $1.0 million of the closure charges for the year ended December 31, 2014 related to IHOP restaurants closed during 2014 with the remainder primarily related to adjustments to the estimated reserve for IHOP and Applebee's restaurants closed prior to 2014. Closure charges for the year ended December 31, 2013 primarily related to adjustments to the estimated reserve for closed surplus IHOP and Applebee's restaurants. Closure charges for the year ended December 31, 2012 primarily related to the closure of one IHOP restaurant that was taken back from the franchisee operator and to adjustments to the estimated reserve for previously closed surplus IHOP properties. | ||||||||||||
Long-lived Tangible Asset Impairment | ||||||||||||
Long-lived tangible asset impairment charges for the year ended December 31, 2014 related primarily to two IHOP company-operated restaurants in the Cincinnati, Ohio area. The Company evaluated the causal factors of all impairments of long-lived assets as they were recorded during 2014 and concluded they were based on factors specific to each asset and not potential indicators of an impairment of other long-lived assets. | ||||||||||||
Long-lived tangible asset impairment charges for the year ended December 31, 2013 related to three Applebee's company-operated restaurants in the Kansas City, Missouri area. The Company evaluated the causal factors of all impairments of long-lived assets as they were recorded during 2013 and concluded they were based on factors specific to each asset and not potential indicators of an impairment of other long-lived assets. | ||||||||||||
Long-lived tangible asset impairment charges for the year ended December 31, 2012 related to equipment at five IHOP restaurants that were taken back from the franchisee operator and subsequently refranchised and to a parcel of land previously intended for future restaurant development. The Company evaluated the causal factors of all impairments of long-lived assets as they were recorded during 2012 and concluded they were based on factors specific to each asset and not potential indicators of an impairment of other long-lived assets. |
StockBased_Incentive_Plans
Stock-Based Incentive Plans | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Stock-Based Incentive Plans | Stock-Based Incentive Plans | |||||||||||||
General Description | ||||||||||||||
Currently, the Company is authorized to grant stock options, stock appreciation rights, restricted stock, cash-settled and stock-settled restricted stock units and performance units to officers, other employees and non-employee directors under the DineEquity, Inc. 2011 Stock Incentive Plan (the “2011 Plan”). The 2011 Plan was approved by stockholders on May 17, 2011 and permits the issuance of up to 1,500,000 shares of the Company’s common stock for incentive stock awards. The 2011 Plan will expire in May 2021. | ||||||||||||||
The IHOP Corp. 2001 Stock Incentive Plan (the “2001 Plan”) was adopted in 2001 and amended and restated in 2005 and 2008 to authorize the issuance of up to 4,200,000 shares of common stock. The 2001 Plan has expired but there are stock options issued under the 2001 Plan outstanding as of December 31, 2014. | ||||||||||||||
The Stock Option Plan for Non-Employee Directors (the “Directors Plan”) was adopted in 1994 and amended and restated in 1999 to authorize the issuance of up to 400,000 shares of common stock pursuant to options to non-employee directors. The Directors Plan has expired but there are stock options issued under the Directors Plan outstanding as of December 31, 2014. | ||||||||||||||
The 2011 Plan, the 2001 Plan and the Directors Plan are collectively referred to as the “Plans.” | ||||||||||||||
Stock-Based Compensation Expense | ||||||||||||||
From time to time, the Company has granted nonqualified stock options, restricted stock, cash-settled and stock-settled restricted stock units and performance units to officers, other employees and non-employee directors of the Company under the Plans. The nonqualified stock options generally vest ratably over a three-year period in one-third increments and have a maturity of ten years from the grant date. Options vest immediately upon a change in control of the Company, as defined in the Plans. Option exercise prices equal the closing price of the Company's common stock on the New York Stock Exchange on the date of grant. Restricted stock and restricted stock units are issued at no cost to the holder and vest over terms determined by the Compensation Committee of the Company's Board of Directors, generally three years from the date of grant or immediately upon a change in control of the Company, as defined in the Plans. The Company either utilizes treasury stock or issues new shares from its authorized but unissued share pool when vested stock options are exercised, when restricted stock awards are granted and when restricted stock units settle in stock upon vesting. | ||||||||||||||
The following table summarizes the Company's stock-based compensation expense included as a component of general and administrative expenses in the consolidated financial statements: | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2014 | 2013 | 2012 | ||||||||||||
(In millions) | ||||||||||||||
Total stock-based compensation expense: | ||||||||||||||
Equity classified awards | $ | 9.4 | $ | 9.4 | $ | 11.4 | ||||||||
Liability classified awards | 2.4 | 0.9 | 4.8 | |||||||||||
Total pre-tax stock-based compensation expense | 11.8 | 10.3 | 16.3 | |||||||||||
Tax benefit | (4.5 | ) | (3.9 | ) | (6.2 | ) | ||||||||
Total stock-based compensation expense, net of tax | $ | 7.3 | $ | 6.4 | $ | 10.1 | ||||||||
As of December 31, 2014, total unrecognized compensation cost related to restricted stock and restricted stock units of $9.1 million and $3.2 million related to stock options is expected to be recognized over a weighted average period of approximately 1.49 years for restricted stock and restricted stock units and 1.37 years years for stock options. | ||||||||||||||
Equity Classified Awards - Stock Options | ||||||||||||||
The per share fair values of the stock options granted have been estimated as of the date of grant using the Black-Scholes option pricing model. The Black-Scholes model considers, among other factors, the expected life of the option and the historical volatility of the Company's stock price. The Black-Scholes model meets the requirements of U.S. GAAP, but the fair values generated by the model may not be indicative of the actual fair values of the Company's stock-based awards. The following table summarizes the assumptions used to value options granted in the respective periods: | ||||||||||||||
2014 | 2013 | 2012 | ||||||||||||
Risk free interest rate | 1.6 | % | 0.8 | % | 0.9 | % | ||||||||
Weighted average historical volatility | 51.1 | % | 83.4 | % | 84.5 | % | ||||||||
Dividend yield | 3.7 | % | 4.2 | % | — | % | ||||||||
Expected years until exercise | 4.6 | 4.6 | 4.7 | |||||||||||
Forfeitures | 11 | % | 11 | % | 11 | % | ||||||||
Weighted average fair value of options granted | $ | 26.87 | $ | 36 | $ | 33.53 | ||||||||
Stock option activity for the years ended December 31, 2014, 2013 and 2012 is summarized as follows: | ||||||||||||||
Number of | Weighted Average | Weighted Average | Aggregate Intrinsic | |||||||||||
Shares Under Option | Exercise Price | Remaining Contractual | Value (in Millions) | |||||||||||
Per Share | Term (in Years) | |||||||||||||
Outstanding at December 31, 2011 | 1,318,640 | $ | 32.06 | |||||||||||
Granted | 147,674 | 51.63 | ||||||||||||
Exercised | (455,217 | ) | 20.91 | |||||||||||
Forfeited | (39,381 | ) | 46.97 | |||||||||||
Expired | (13,470 | ) | 38.64 | |||||||||||
Outstanding at December 31, 2012 | 958,246 | 39.67 | ||||||||||||
Granted | 81,328 | 72.28 | ||||||||||||
Exercised | (225,272 | ) | 40.31 | |||||||||||
Forfeited | (39,243 | ) | 55.78 | |||||||||||
Outstanding at December 31, 2013 | 775,059 | 42.09 | ||||||||||||
Granted | 120,932 | 81.53 | ||||||||||||
Exercised | (256,910 | ) | 31.95 | |||||||||||
Forfeited | (20,966 | ) | 69.18 | |||||||||||
Outstanding at December 31, 2014 | 618,115 | $ | 53.1 | 6 | $ | 31.2 | ||||||||
Vested and Expected to Vest at December 31, 2014 | 600,708 | $ | 52.36 | 5.9 | $ | 30.8 | ||||||||
Exercisable at December 31, 2014 | 433,793 | $ | 44.09 | 4.8 | $ | 25.8 | ||||||||
The total intrinsic value of options exercised during the years ended December 31, 2014, 2013 and 2012 was $13.2 million, $7.5 million and $15.0 million, respectively. | ||||||||||||||
Cash received from options exercised under all stock-based payment arrangements for the years ended December 31, 2014, 2013 and 2012 was $8.2 million, $9.1 million and $9.3 million, respectively. The actual tax benefit realized for the tax deduction from option exercises under the stock-based payment arrangements totaled $4.3 million, $3.7 million and $6.2 million, respectively, for the years ended December 31, 2014, 2013 and 2012. | ||||||||||||||
Equity Classified Awards - Restricted Stock and Restricted Stock Units | ||||||||||||||
Activity in equity classified awards of restricted stock and restricted stock units for the years ended December 31, 2014, 2013 and 2012 is as follows: | ||||||||||||||
Shares of Restricted Stock | Weighted | Restricted | Weighted | |||||||||||
Average | Stock Units | Average | ||||||||||||
Grant-Date Per | Grant-Date | |||||||||||||
Share | Per Share | |||||||||||||
Fair Value | Fair Value | |||||||||||||
Outstanding at December 31, 2011 | 486,533 | $ | 31.08 | 18,000 | $ | 29.32 | ||||||||
Granted | 137,852 | 52.23 | 19,152 | 52.23 | ||||||||||
Released | (179,465 | ) | 13.83 | (3,910 | ) | 40.58 | ||||||||
Forfeited | (98,357 | ) | 44.4 | — | — | |||||||||
Outstanding at December 31, 2012 | 346,563 | 44.74 | 33,242 | 41.19 | ||||||||||
Granted | 97,812 | 73.11 | 15,804 | 72.04 | ||||||||||
Conversion of cash-settled restricted stock units | — | — | 37,184 | 72.28 | ||||||||||
Released | (117,075 | ) | 30.96 | (39,000 | ) | 54.66 | ||||||||
Forfeited | (61,048 | ) | 55.37 | — | — | |||||||||
Outstanding at December 31, 2013 | 266,252 | 58.87 | 47,230 | 64.57 | ||||||||||
Granted | 102,618 | 82.18 | 13,879 | 81.65 | ||||||||||
Released | (94,798 | ) | 53.03 | (19,487 | ) | 70.82 | ||||||||
Forfeited | (40,254 | ) | 67.68 | — | — | |||||||||
Outstanding at December 31, 2014 | 233,818 | $ | 70.14 | 41,622 | $ | 66.92 | ||||||||
Liability Classified Awards - Restricted Stock Units | ||||||||||||||
The Company previously had issued shares of cash-settled restricted stock units to members of the Board of Directors. Originally these instruments were expected to be settled in cash and were recorded as liabilities based on the closing price of the Company’s common stock as of each period end. In February 2013, it was determined that, pursuant to the terms of the Plan, these restricted stock units would be settled in shares of common stock and all outstanding restricted stock units were converted to equity classified awards. Activity in liability classified awards of restricted stock units for the years ended December 31, 2013 and 2012 is as follows: | ||||||||||||||
Cash-Settled Restricted Stock Units | Weighted | |||||||||||||
Average | ||||||||||||||
Per Share | ||||||||||||||
Fair Value | ||||||||||||||
Outstanding at December 31, 2011 | 41,957 | 64.26 | ||||||||||||
Granted | — | — | ||||||||||||
Released | (4,773 | ) | 49.66 | |||||||||||
Outstanding at December 31, 2012 | 37,184 | 66.13 | ||||||||||||
Conversion to stock-settled restricted stock units | (37,184 | ) | 72.28 | |||||||||||
Outstanding at December 31, 2013 | — | |||||||||||||
For the years ended December 31, 2013 and 2012, $0.3 million and $1.0 million, respectively, was included as stock-based compensation expense related to these cash-settled restricted stock units. | ||||||||||||||
The Company has granted cash long-term incentive awards to certain employees (“LTIP awards”). Annual LTIP awards vest over a three-year period and are determined using a multiplier from 0% to 200% of the target award based on the total shareholder return of DineEquity, Inc. common stock compared to the total shareholder returns of a peer group of companies. Though LTIP awards are only paid in cash, since the multiplier is based on the price of the Company's common stock, the awards are considered stock-based compensation in accordance with U.S. GAAP and are classified as liabilities. For the years ended December 31, 2014, 2013 and 2012, $2.4 million, $0.6 million and $3.8 million, respectively, were included in stock-based compensation expense related to the LTIP awards. At December 31, 2014 and 2013, liabilities of $4.0 million and $2.8 million, respectively, were included as accrued employee compensation and benefits in the consolidated balance sheet. |
Employee_Benefit_Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2014 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans |
401(k) Savings and Investment Plan | |
Effective January 1, 2013, the Company amended the DineEquity, Inc. 401(k) Plan to (i) modify the Company matching formula and (ii) eliminate the one year completed service requirement that previously had to be met to become eligible for Company matching contributions. As amended, the Company matches 100% of the first four percent of the employee's eligible compensation deferral and 50% of the next two percent of the employee's eligible compensation deferral. All contributions under this plan vest immediately. DineEquity common stock is not an investment option for employees in the 401(k) plan, other than shares transferred from a prior employee stock ownership plan. Substantially all of the administrative cost of the 401(k) plan is borne by the Company. The Company's matching contribution expense was $2.3 million, $2.3 million and $2.2 million for the years ended December 31, 2014, 2013 and 2012, respectively. |
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
Income Taxes | Income Taxes | |||||||||||
The provision (benefit) for income taxes for the years ended December 31, 2014, 2013 and 2012 was as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(In millions) | ||||||||||||
Provision (benefit) for income taxes: | ||||||||||||
Current | ||||||||||||
Federal | $ | 33.2 | $ | 48.5 | $ | 77.4 | ||||||
State | 3.6 | 2.1 | 1.9 | |||||||||
Foreign | 2.7 | 2.4 | 1.8 | |||||||||
39.5 | 53 | 81.1 | ||||||||||
Deferred | ||||||||||||
Federal | (22.1 | ) | (13.5 | ) | (12.2 | ) | ||||||
State | (2.3 | ) | (0.9 | ) | (1.7 | ) | ||||||
(24.4 | ) | (14.4 | ) | (13.9 | ) | |||||||
Provision for income taxes | $ | 15.1 | $ | 38.6 | $ | 67.2 | ||||||
The provision for income taxes differs from the expected federal income tax rates as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Statutory federal income tax rate | 35 | % | 35 | % | 35 | % | ||||||
State and other taxes, net of federal tax benefit | 2.4 | 2.9 | 2.8 | |||||||||
Change in unrecognized tax benefits | 2.4 | 1.4 | (0.2 | ) | ||||||||
Change in valuation allowance | — | (2.7 | ) | 0.7 | ||||||||
Domestic production activity deduction | (6.0 | ) | — | — | ||||||||
Research and experimentation tax credit | (3.4 | ) | — | — | ||||||||
State adjustments including audits and settlements | (1.1 | ) | (1.1 | ) | 0.2 | |||||||
Compensation related tax credits, net of deduction offsets | (0.8 | ) | (0.6 | ) | (0.9 | ) | ||||||
Changes in tax rates and state tax laws | — | — | (3.2 | ) | ||||||||
Other | 0.8 | — | 0.1 | |||||||||
Effective tax rate | 29.3 | % | 34.9 | % | 34.5 | % | ||||||
The Company retroactively adopted the domestic production activity deduction and the federal research and experimentation credit in 2014. Deductions related to 2014 domestic production activity lowered the 2014 tax rate by 2.3%, while deductions related to domestic production activity in prior years lowered the 2014 tax rate by 3.7%. Similarly, tax credits related to 2014 research activity lowered the 2014 tax rate by 0.5%, while tax credits related to research activity in prior years lowered the 2014 tax rate by 2.9%. | ||||||||||||
Net deferred tax assets (liabilities) consisted of the following components: | ||||||||||||
2014 | 2013 | |||||||||||
(In millions) | ||||||||||||
Differences in capitalization and depreciation and amortization of reacquired franchises and equipment | $ | 4.8 | $ | 4.8 | ||||||||
Differences in acquisition financing costs | 1.8 | 1.8 | ||||||||||
Employee compensation | 14.4 | 15 | ||||||||||
Deferred gain on sale of assets | 6.5 | 6.3 | ||||||||||
Book/tax difference in revenue recognition | 39.6 | 29.8 | ||||||||||
Other | 35.9 | 35 | ||||||||||
Deferred tax assets | 103 | 92.7 | ||||||||||
Valuation allowance | (1.1 | ) | (1.1 | ) | ||||||||
Total deferred tax assets after valuation allowance | 101.9 | 91.6 | ||||||||||
Differences between financial and tax accounting in the recognition of franchise and equipment sales | (48.0 | ) | (51.2 | ) | ||||||||
Differences in capitalization and depreciation (1) | (294.6 | ) | (301.1 | ) | ||||||||
Differences in acquisition financing costs | — | (7.1 | ) | |||||||||
Book/tax difference in revenue recognition | (15.6 | ) | (19.5 | ) | ||||||||
Differences between book and tax basis of property and equipment | (11.4 | ) | (10.1 | ) | ||||||||
Other | (20.5 | ) | (20.3 | ) | ||||||||
Deferred tax liabilities | (390.1 | ) | (409.3 | ) | ||||||||
Net deferred tax liabilities | $ | (288.2 | ) | $ | (317.7 | ) | ||||||
Net deferred tax asset—current | $ | 31.2 | $ | 24.2 | ||||||||
Valuation allowance—current | (0.3 | ) | (0.3 | ) | ||||||||
Net deferred tax asset—current | 30.9 | 23.9 | ||||||||||
Deferred tax liability—non-current | (318.3 | ) | (340.8 | ) | ||||||||
Valuation allowance—non-current | (0.8 | ) | (0.8 | ) | ||||||||
Net deferred tax liability—non-current | (319.1 | ) | (341.6 | ) | ||||||||
Net deferred tax liabilities | $ | (288.2 | ) | $ | (317.7 | ) | ||||||
_____________________________________ | ||||||||||||
(1) | Primarily related to the Applebee's acquisition. | |||||||||||
The Company files federal income tax returns and the Company or one of its subsidiaries file income tax returns in various state and foreign jurisdictions. With few exceptions, the Company is no longer subject to federal, state or non-United States tax examinations by tax authorities for years before 2008. In the second quarter of 2013, the Internal Revenue Service (“IRS”) issued a Revenue Agent’s Report (“RAR”) related to its examination of the Company’s U.S federal income tax return for the tax years 2008 to 2010. The Company disagrees with a portion of the proposed assessments and has contested them through the IRS administrative appeals procedures. We anticipate the appeals process to continue into 2015. The Company continues to believe that adequate reserves have been provided relating to all matters contained in the tax periods open to examination. | ||||||||||||
The total gross unrecognized tax benefit as of December 31, 2014 and 2013 was $3.4 million and $2.7 million, respectively, excluding interest, penalties and related income tax benefits. The entire $3.4 million will be included in the Company's effective income tax rate if recognized. | ||||||||||||
The Company estimates the unrecognized tax benefits may decrease over the upcoming 12 months by an amount up to $0.7 million related to settlements with taxing authorities and the lapse of statutes of limitations. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Unrecognized tax benefit as of January 1 | $ | 2.7 | $ | 6.7 | $ | 8.2 | ||||||
Changes for tax positions of prior years | 1.2 | 0.8 | 0.8 | |||||||||
Increases for tax positions related to the current year | 0.1 | — | 0.2 | |||||||||
Decreases relating to settlements and lapsing of statutes of limitations | (0.6 | ) | (4.8 | ) | (2.5 | ) | ||||||
Unrecognized tax benefit as of December 31 | $ | 3.4 | $ | 2.7 | $ | 6.7 | ||||||
As of December 31, 2014, the accrued interest and penalties were $3.9 million and $0.1 million, respectively, excluding any related income tax benefits. As of December 31, 2013, the accrued interest and penalties were $2.9 million and $0.1 million, respectively, excluding any related income tax benefits. The increase of $1.0 million of accrued interest is primarily related to an increase in unrecognized tax benefits as a result of recent audits by taxing authorities. The Company recognizes interest accrued related to unrecognized tax benefits and penalties as a component of the income tax provision recognized in the Consolidated Statements of Comprehensive Income. | ||||||||||||
The valuation allowance of $1.1 million as of both December 31, 2014 and 2013 related to the Massachusetts enacted legislation requiring unitary businesses to file combined reports. As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact management’s view with regards to future realization of deferred tax assets. As of December 31, 2014, management determined that, based on available evidence, there was no change to the valuation allowance. |
Net_Income_Per_Share
Net Income Per Share | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Earnings Per Share [Abstract] | ||||||||||||
Net Income Per Share | Net Income Per Share | |||||||||||
The computation of the Company's basic and diluted net income per share is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(In thousands, except per share data) | ||||||||||||
Numerator for basic and diluted income per common share: | ||||||||||||
Net income | $ | 36,453 | $ | 72,037 | $ | 127,674 | ||||||
Less: Accretion of Series B preferred stock | — | — | (2,498 | ) | ||||||||
Less: Net income allocated to unvested participating restricted stock | (521 | ) | (1,200 | ) | (2,718 | ) | ||||||
Net income available to common stockholders - basic | 35,932 | 70,837 | 122,458 | |||||||||
Effect of unvested participating restricted stock | — | 4 | 127 | |||||||||
Effect of dilutive securities: | ||||||||||||
Convertible Series B preferred stock | — | — | 2,498 | |||||||||
Numerator - net income available to common shareholders - diluted | $ | 35,932 | $ | 70,841 | $ | 125,083 | ||||||
Denominator: | ||||||||||||
Weighted average outstanding shares of common stock - basic | 18,753 | 18,871 | 17,992 | |||||||||
Effect of dilutive securities: | ||||||||||||
Stock options | 203 | 270 | 264 | |||||||||
Convertible Series B preferred stock | — | — | 621 | |||||||||
Weighted average outstanding shares of common stock - diluted | 18,956 | 19,141 | 18,877 | |||||||||
Net income per common share: | ||||||||||||
Basic | $ | 1.92 | $ | 3.75 | $ | 6.81 | ||||||
Diluted | $ | 1.9 | $ | 3.7 | $ | 6.63 | ||||||
Segments
Segments | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
Segment Reporting | Segment Reporting | |||||||||||
Information on segments and a reconciliation to income (loss) before income taxes are as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Revenues | (In millions) | |||||||||||
Franchise operations | $ | 456.1 | $ | 439.2 | $ | 421.4 | ||||||
Company restaurants | 62.5 | 63.4 | 291.1 | |||||||||
Rental operations | 122.9 | 124.8 | 122.9 | |||||||||
Financing operations | 13.5 | 13.1 | 14.5 | |||||||||
Total | $ | 655 | $ | 640.5 | $ | 849.9 | ||||||
Income (loss) before income taxes | ||||||||||||
Franchise operations | $ | 334.3 | $ | 329.5 | $ | 311.5 | ||||||
Company restaurants | (0.2 | ) | (0.2 | ) | 41.8 | |||||||
Rental operations | 28.3 | 27.5 | 25.7 | |||||||||
Financing operations | 12.7 | 12.9 | 12.9 | |||||||||
Corporate | (323.5 | ) | (259.1 | ) | (197.0 | ) | ||||||
Income (loss) before income taxes | $ | 51.6 | $ | 110.6 | $ | 194.9 | ||||||
Interest expense | ||||||||||||
Company restaurants | $ | 0.4 | $ | 0.4 | $ | 0.4 | ||||||
Rental operations | 14.7 | 15.7 | 17 | |||||||||
Corporate | 96.6 | 100.3 | 114.3 | |||||||||
Total | $ | 111.7 | $ | 116.4 | $ | 131.7 | ||||||
Depreciation and amortization | ||||||||||||
Franchise operations | $ | 10.4 | $ | 10.8 | $ | 9.8 | ||||||
Company restaurants | 2.1 | 2.2 | 6.9 | |||||||||
Rental operations | 13.2 | 13.4 | 13.6 | |||||||||
Corporate | 9 | 9 | 9.2 | |||||||||
Total | $ | 34.7 | $ | 35.4 | $ | 39.5 | ||||||
Closure and impairment charges | ||||||||||||
Company restaurants | $ | 3.7 | $ | 1.8 | $ | 4.2 | ||||||
Total | $ | 3.7 | $ | 1.8 | $ | 4.2 | ||||||
Capital expenditures | ||||||||||||
Company restaurants | $ | 1.5 | $ | 1.3 | $ | 9.5 | ||||||
Corporate | 4.4 | 5.7 | 7.5 | |||||||||
Total | $ | 5.9 | $ | 7 | $ | 17 | ||||||
Goodwill (franchise segment) | $ | 697.5 | $ | 697.5 | $ | 697.5 | ||||||
Total assets | ||||||||||||
Franchise operations | $ | 1,635.00 | $ | 1,606.40 | $ | 1,523.00 | ||||||
Company restaurants | 177.7 | 191.6 | 186.2 | |||||||||
Rental operations | 344.3 | 364 | 397.3 | |||||||||
Financing operations | 109.9 | 117.1 | 125.4 | |||||||||
Corporate | 181.2 | 125.5 | 183.5 | |||||||||
Total | $ | 2,448.10 | $ | 2,404.60 | $ | 2,415.40 | ||||||
Selected_Quarterly_Financial_D
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||
Selected Quarterly Financial Data (Unaudited) | Selected Quarterly Financial Data (Unaudited) | |||||||||||||||||||
Revenues(1) | Operating | Net Income (Loss) | Net Income | Net Income | ||||||||||||||||
Margin | (Loss) | (Loss) | ||||||||||||||||||
Per Share— | Per Share— | |||||||||||||||||||
Basic(2) | Diluted(2) | |||||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||
2014 | ||||||||||||||||||||
1st Quarter | $ | 167,201 | $ | 97,072 | $ | 20,824 | $ | 1.09 | $ | 1.08 | ||||||||||
2nd Quarter | 160,521 | 94,473 | 19,167 | 1 | 1 | |||||||||||||||
3rd Quarter | 162,853 | 91,629 | 18,887 | 0.99 | 0.99 | |||||||||||||||
4th Quarter (1) | 164,413 | 91,941 | (22,425 | ) | (1.18 | ) | n/a | |||||||||||||
2013 | ||||||||||||||||||||
1st Quarter | $ | 163,169 | $ | 94,424 | $ | 18,239 | $ | 0.95 | $ | 0.93 | ||||||||||
2nd Quarter | 158,114 | 91,026 | 16,937 | 0.88 | 0.87 | |||||||||||||||
3rd Quarter | 161,283 | 93,043 | 18,730 | 0.98 | 0.97 | |||||||||||||||
4th Quarter | 157,901 | 91,199 | 18,131 | 0.95 | 0.94 | |||||||||||||||
______________________________________________________________________________________________________ | ||||||||||||||||||||
(1) Net income was impacted by loss on extinguishment of debt related to the Company's refinancing of its long-term debt. See Note 7 of Notes to Consolidated Financial Statements. | ||||||||||||||||||||
(2) The quarterly amounts may not add to the full year amount as each quarterly calculation is discrete from the full-year calculation. |
Basis_of_Presentation_and_Summ1
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Accounting Policies [Abstract] | |||
Principles of Consolidation | Principles of Consolidation | ||
The consolidated financial statements include the accounts of DineEquity, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. | |||
Fiscal Periods | Fiscal Periods | ||
The Company has a 52/53 week fiscal year that ends on the Sunday nearest to December 31 of each year. In a 52-week fiscal year, each fiscal quarter contains 13 weeks, comprised of two, four-week fiscal months followed by a five-week fiscal month. In a 53-week fiscal year, the last month of the fourth fiscal quarter contains six weeks. For convenience, the Company refers to all fiscal years as ending on December 31 and fiscal quarters as ending on March 31, June 30 and September 30. The 2014, 2013 and 2012 fiscal years presented herein ended December 28, 2014, December 29, 2013 and December 30, 2012, respectively, and each contained 52 weeks. | |||
Use of Estimates | Use of Estimates | ||
The preparation of financial statements in conformity with United States generally accepted accounting principles (“U.S. GAAP”) requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, if any, at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant estimates are made in the calculation and assessment of the following: (a) impairment of tangible and intangible assets, (b) income taxes, (c) allowance for doubtful accounts and notes receivables, (d) lease accounting estimates and (e) contingencies. On an ongoing basis, the Company evaluates its estimates based on historical experience, current conditions and various other assumptions that are believed to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Actual results could differ from those estimates. | |||
Concentration of Credit Risk | Concentration of Credit Risk | ||
The Company's cash, cash equivalents and accounts receivable are potentially subject to concentration of credit risk. Cash and cash equivalents are placed with financial institutions that management believes are creditworthy. The Company does not believe that it is exposed to any significant credit risk on cash and cash equivalents. At times, cash and cash equivalent balances may be in excess of FDIC insurance limits. | |||
Accounts receivable are derived from revenues earned from franchisees and area licensees located primarily in the United States. Financing receivables arise from the financing of restaurant equipment, leases or franchise fees by IHOP franchisees. The Company is subject to a concentration of credit risk with respect to receivables from franchisees that own a large number of Applebee's or IHOP restaurants. As of December 31, 2014, there were 15 franchisees that owned 54 or more restaurants each (11 Applebee's franchisees and four IHOP franchisees). These franchisees operated 1,693 Applebee's and IHOP restaurants in the United States, which comprised 49% of the total Applebee's and IHOP franchise and area license restaurants in the United States. Receivables from these franchisees totaled $50.7 million at December 31, 2014. | |||
The Company maintains an allowance for credit losses based upon historical experience while taking into account current economic conditions. | |||
Cash and Cash Equivalents | Cash and Cash Equivalents | ||
The Company considers all highly liquid investment securities with remaining maturities at the date of purchase of three months or less to be cash equivalents. These cash equivalents are stated at cost which approximates market value. Cash held related to IHOP advertising funds and the Company's gift card programs are classified as unrestricted cash as there are no legal restrictions on the use of these funds. | |||
Restricted Assets | Restricted Assets | ||
Restricted Cash - Current | |||
Current restricted cash of $52.3 million as of December 31, 2014 consisted of $52.1 million of funds required to be held in trust in connection with the Company's securitized debt arrangements and $0.2 million of funds from Applebee's franchisees pursuant to franchise agreements, usage of which is restricted to advertising activities. Current restricted cash of $0.7 million at December 31, 2013 related to funds from Applebee's franchisees pursuant to franchise agreements, usage of which is restricted to advertising activities. | |||
Restricted Cash - Non-current | |||
Non-current restricted cash of $14.7 million as of December 31, 2014 represents interest reserves required to be set aside for the duration of the securitized debt and is included in other non-current assets, net in the consolidated balance sheets. | |||
Other Restricted Assets | |||
At December 31, 2014 and 2013, restricted assets related to a captive insurance subsidiary totaled $1.2 million and $1.9 million, respectively, and were included in other non-current assets, net in the consolidated balance sheets. The captive insurance subsidiary, which has not underwritten coverage since January 2006, was formed to provide insurance coverage to Applebee's and its franchisees. These restricted assets are primarily investments, use of which is restricted to the payment of insurance claims for incidents that occurred during the period the insurance coverage had been provided. | |||
Investments | Investments | ||
The Company's investments comprise certificates of deposit, money market funds and an auction rate security that are the restricted assets related to the captive insurance subsidiary. The Company has classified all investments as available-for-sale with any unrealized gain or loss included in Accumulated Other Comprehensive Loss. The contractual maturity of the auction rate security is 2030. | |||
Property and Equipment | Property and Equipment | ||
Property and equipment are stated at cost, net of accumulated depreciation. Properties under capital leases are stated at the present value of the minimum lease payments. Depreciation is computed using the straight-line method over the estimated useful lives of the assets or remaining useful lives. Leasehold improvements and properties under capital leases are amortized on a straight-line basis over their estimated useful lives or the lease term, if less. The Company has capitalized certain costs incurred in connection with the development of internal-use software which are included in equipment and fixtures and amortized over the expected useful life of the asset. The general ranges of depreciable and amortizable lives are as follows: | |||
Category | Depreciable Life | ||
Buildings and improvements | 25 - 40 years | ||
Leaseholds and improvements | Shorter of primary lease term or between three to 40 years | ||
Equipment and fixtures | Two to 10 years | ||
Properties under capital leases | Primary lease term or remaining primary lease term | ||
Long-Lived Assets | Long-Lived Assets | ||
The Company evaluates the recoverability of its long-lived assets in accordance with U.S. GAAP. The Company tests impairment using historical cash flows and other relevant facts and circumstances as the primary basis for estimates of future cash flows. The Company considers factors such as the number of years a restaurant has been in operation, sales trends, cash flow trends, remaining lease life and other factors which apply on a case-by-case basis. The analysis is performed at the individual restaurant level for indicators of permanent impairment. | |||
Recoverability of a restaurant's assets is measured by comparing the assets' carrying value to the undiscounted future cash flows expected to be generated over the assets' remaining useful life or remaining lease term, whichever is less. If the total expected undiscounted future cash flows are less than the carrying amount of the assets, this may be an indicator of impairment. If it is decided that there has been an impairment, the carrying amount of the asset is written down to the estimated fair value as determined in accordance with U.S. GAAP governing fair value measurements. The primary method of estimating fair value is based on a discounted cash flow analysis. A loss resulting from impairment is recognized as a charge against operations. | |||
The Company may decide to close certain company-operated restaurants. Typically such decisions are based on operating performance or strategic considerations. In these instances, the Company reserves, or writes off, the full carrying value of these restaurants as impaired. | |||
On a regular (at a minimum, semi-annual) basis, the Company assesses whether events or changes in circumstances have occurred that potentially indicate the carrying value of long-lived assets may not be recoverable. See Note 12, Closure and Impairment Charges. | |||
Goodwill and Intangible Assets | Goodwill and Intangible Assets | ||
Goodwill is recorded when the aggregate purchase price of an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Intangible assets resulting from the acquisition are accounted for using the purchase method of accounting and are estimated by management based on the fair value of the assets received. The Company's identifiable intangible assets are comprised primarily of the Applebee's tradename and Applebee's franchise agreements. Identifiable intangible assets with finite lives (franchise agreements, recipes and menus) are amortized over the period of estimated benefit using the straight-line method and estimated useful lives. Goodwill and intangible assets considered to have an indefinite life (primarily the Applebee's tradename) are not subject to amortization. The determination of indefinite life is subject to reassessment if changes in facts and circumstances indicate the period of benefit has become finite. | |||
Goodwill was allocated to three reporting units, the Applebee's company-operated restaurants unit (“Applebee's company unit”), the Applebee's franchised restaurants unit (“Applebee's franchise unit”) and the IHOP franchised restaurants unit (“IHOP franchise unit”), in accordance with U.S. GAAP. The significant majority of the Company's goodwill resulted from the November 29, 2007 acquisition of Applebee's and was allocated between the two Applebee's units. The goodwill allocated to the Applebee's company unit was fully impaired in 2008. | |||
The Company performs a quantitative test for impairment of the goodwill of the Applebee's franchise unit and the tradename of the Applebee's company and franchise units as of October 31 of each year. The goodwill of the IHOP franchise unit is assessed qualitatively as of December 31 of each year. In addition to the annual test of impairment, goodwill and indefinite life intangible assets are evaluated more frequently if the Company believes indicators of impairment exist. Such indicators include, but are not limited to, events or circumstances such as a significant adverse change in the business climate, unanticipated competition, a loss of key personnel, adverse legal or regulatory developments or a significant decline in the market price of the Company's common stock. | |||
In the process of the annual quantitative test of goodwill, the Company primarily uses the income approach method of valuation that includes the discounted cash flow method as well as other generally accepted valuation methodologies to determine the fair value of goodwill and intangible assets. Significant assumptions used to determine fair value under the discounted cash flow model include future trends in sales, operating expenses, overhead expenses, capital expenditures and changes in working capital, along with an appropriate discount rate based on the Company's estimated cost of equity capital and after-tax cost of debt. The first step of the quantitative impairment test compares the fair value of each of the reporting units to their carrying value. If the fair value is in excess of the carrying value, no impairment exists. If the first step does indicate impairment, a second step must take place. Under the second step, the fair value of the assets and liabilities of the reporting unit are estimated as if the reporting unit were acquired in a business combination. The excess of the fair value of the reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of the goodwill, to which the carrying value of the goodwill must be adjusted. | |||
In the process of the Company's annual impairment review of the tradename, the most significant indefinite life intangible asset, the Company primarily uses the relief of royalty method under income approach method of valuation. Significant assumptions used to determine fair value under the relief of royalty method include future trends in sales, a royalty rate and a discount rate to be applied to the forecast revenue stream. | |||
There were no impairments of goodwill or intangible assets recorded in 2014, 2013 or 2012. | |||
Revenue Recognition | Revenue Recognition | ||
The Company's revenues are recorded in four categories: franchise operations, company restaurant operations, rental operations and financing operations. | |||
Franchise operations revenue consists primarily of royalty revenues, sales of proprietary IHOP products, IHOP advertising fees and the portion of the franchise fees allocated to the Company's intellectual property. Company restaurant sales are retail sales at company-operated restaurants. Rental operations revenue includes revenue from operating leases and interest income from direct financing leases. Financing operations revenue consists primarily of interest income from the financing of franchise fees and equipment leases, as well as sales of equipment associated with refranchised IHOP restaurants. | |||
Revenues from franchised and area licensed restaurants include royalties, continuing rent and service fees and initial franchise fees. Royalties are recognized in the period in which the sales are reported to have been earned, which occurs at the franchisees' point of sale. Continuing rent and fees are recognized in the period earned. Initial franchise fees are recognized upon the opening of a restaurant, which is when the Company has performed substantially all initial services required by the franchise agreement. Fees from development agreements are deferred and recorded into income as restaurants under the development agreement are opened. | |||
Sales by company-operated restaurants are recognized when food and beverage items are sold. Company restaurant sales are reported net of sales taxes collected from guests that are remitted to the appropriate taxing authorities. | |||
The Company records a liability in the period in which a gift card is sold and recognizes costs associated with our administration of the gift card programs as prepaid assets when the costs are incurred. As gift cards are redeemed, the liability and prepaid asset are reduced. When gift cards are redeemed at a franchisee-operated restaurant, the revenue and related administrative costs are recognized by the franchisee. The Company recognizes revenue and related administrative costs when gift cards are redeemed at company-operated restaurants. The Company recognizes gift card breakage income on gift cards when the assessment of the likelihood of redemption of the gift card becomes remote. This assessment is based upon Applebee's and IHOP's individual historical experience with gift card redemptions in their own program. The Company recorded gift card breakage revenue of $0.1 million, $0.2 million and $1.3 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||
Allowance for Credit Losses | Allowance for Credit Losses | ||
The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in existing receivables; however, changes in circumstances relating to receivables may result in additional allowances in the future. The Company determines the allowance based on historical experience, current payment patterns, future obligations and the Company's assessment of the franchisee's or area licensee's ability to pay outstanding balances. The primary indicator of credit quality is delinquency, which is considered to be a receivable balance greater than 90 days past due. The Company continually reviews the allowance for doubtful accounts. Past due balances and future obligations are reviewed individually for collectability. Account balances are charged against the allowance after all collection efforts have been exhausted and the potential for recovery is considered remote. | |||
Leases | Leases | ||
The Company is the lessor or sub-lessor of the properties on which 709 IHOP restaurants and one Applebee's restaurant are located. The restaurants are subleased to franchisees or, in a few instances, are operated by the Company. The Company's IHOP leases generally provide for an initial term of 15 to 25 years, with most having one or more five-year renewal options at the Company's option. In addition, the Company leases a majority of its Applebee's company-operated restaurants. The Applebee's company-operated leases generally have an initial term of 10 to 20 years, with renewal terms of five to 20 years, and provide for a fixed rental plus, in certain instances, percentage rentals based on gross sales. The rental payments or receipts on leases that meet the operating lease criteria are recorded as rental expense or rental income, respectively. Rental expense and rental income for these operating leases are recognized on the straight-line basis over the original terms of the leases. Any difference between straight-line rent expense or income and actual amounts paid or received represents deferred rent and is included in the consolidated balance sheets as other assets or other liabilities, as appropriate. | |||
The rental payments or receipts on those property leases that meet the capital lease criteria result in the recognition of interest expense or interest income and a reduction of capital lease obligation or financing lease receivable, respectively. Capital lease obligations are amortized based on the Company's incremental borrowing rate and direct financing leases are amortized using the implicit interest rate. | |||
The lease term used for straight-line rent expense is calculated from the date the Company obtains possession of the leased premises through the lease termination date. The Company records rent from the possession date through restaurant open date as expense. Once a restaurant opens for business, the Company records straight-line rent over the lease term plus contingent rent to the extent it exceeded the minimum rent obligation per the lease agreement. The Company uses a consistent lease term when calculating depreciation of leasehold improvements, when determining straight-line rent expense and when determining classification of its leases as either operating or capital. For leases that contain rent escalations, the Company records the total rent payable during the lease term, as determined above, on the straight-line basis over the term of the lease (including the rent holiday period beginning upon our possession of the premises), and records the difference between the minimum rents paid and the straight-line rent as a lease obligation. Certain leases contain provisions that require additional rental payments based upon restaurant sales volume (“contingent rent”). Contingent rentals are accrued each period as the liabilities are incurred, in addition to the straight-line rent expense noted above. | |||
Certain lease agreements contain tenant improvement allowances, rent holidays and lease premiums, which are amortized over the shorter of the estimated useful life or lease term. For tenant improvement allowances, the Company also records a deferred rent liability or an obligation in non-current liabilities on the consolidated balance sheets and amortizes the deferred rent over the term of the lease as a reduction to company restaurant expenses in the consolidated statements of comprehensive income. | |||
Pre-opening Expenses | Pre-opening Expenses | ||
Expenditures related to the opening of new or relocated restaurants are charged to expense when incurred. | |||
Advertising | Advertising | ||
Franchise fees designated for IHOP's national advertising fund and local marketing and advertising cooperatives are recognized as revenue as the fees are earned and become receivables from the franchisee in accordance with U.S. GAAP governing the accounting for franchise fee revenue. In accordance with U.S. GAAP governing advertising costs, related advertising obligations are accrued and the costs expensed at the same time the related revenue is recognized. Due to different contractual terms in Applebee's marketing agreements, franchise fees designated for Applebee's national advertising fund and local advertising cooperatives constitute agency transactions and are not recognized as revenues and expenses. In both cases, the advertising fees are recorded as a liability against which specific costs are charged. Advertising fees included in IHOP franchise revenue and expense for the years ended December 31, 2014, 2013 and 2012 were $90.3 million, $79.5 million and $76.4 million, respectively. | |||
Advertising expense reflected in the consolidated statements of comprehensive income includes local marketing advertising costs incurred by company-operated restaurants, contributions to the national advertising fund made by Applebee's and IHOP company-operated restaurants and certain advertising costs incurred by the Company to benefit future franchise operations. Costs of advertising are expensed either as incurred or the first time the advertising takes place. Advertising expense included in company restaurant operations for the years ended December 31, 2014, 2013 and 2012 was $2.9 million, $2.9 million and $13.1 million, respectively. The decline from 2012 to 2013 was due to the decrease in the number of Applebee's company-operated restaurants. | |||
Fair Value Measurements | Fair Value Measurements | ||
The Company determines the fair market values of its financial assets and liabilities, as well as non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis, based on the fair value hierarchy established in U.S. GAAP. As necessary, the Company measures its financial assets and liabilities using inputs from the following three levels of the fair value hierarchy: | |||
• | Level 1 inputs are quoted prices in active markets for identical assets or liabilities. | ||
• | Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities. | ||
• | Level 3 inputs are unobservable and reflect the Company's own assumptions. | ||
The Company does not have a material amount of financial assets or liabilities that are required under U.S. GAAP to be measured at fair value on either a recurring or non-recurring basis. None of the Company's non-financial assets or non-financial liabilities is required to be measured at fair value on a recurring basis. The Company has not elected to use fair value measurement for any assets or liabilities for which fair value measurement is not presently required. | |||
The Company believes the fair values of cash equivalents, accounts receivable, accounts payable and the current portion of long-term debt approximate their carrying amounts due to their short duration. | |||
Income Taxes | Income Taxes | ||
The Company utilizes the liability method of accounting for income taxes. Under the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates. A valuation allowance is recorded when it is more likely than not that some or all of the deferred tax assets will not be realized. The Company also determines its tax contingencies in accordance with U.S. GAAP governing the accounting for contingencies. The Company records estimated tax liabilities to the extent the contingencies are probable and can be reasonably estimated. The Company recognizes interest accrued related to unrecognized tax benefits and penalties as a component of the income tax provision recognized in the Consolidated Statements of Comprehensive Income. | |||
The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by taxing authorities including all appeals or litigation processes, based on its technical merits. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate resolution. For each reporting period, management applies a consistent methodology to measure and adjust all uncertain tax positions based on the available information. | |||
Stock-Based Compensation | Stock-Based Compensation | ||
Members of the Board of Directors and certain employees are eligible to receive stock options, restricted stock, restricted stock units and performance units pursuant to the DineEquity, Inc. 2011 Stock Incentive Plan. The Company accounts for all stock-based payments to employees and non-employee directors, including grants of stock options, restricted stock and restricted stock units to be recognized in the financial statements, based on their respective grant date fair values. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service periods. The Company reports the benefits of tax deductions in excess of recognized compensation cost as a financing cash flow. | |||
The grant date fair value of restricted stock and stock-settled restricted stock units is determined based on the Company's stock price on the grant date. The Company estimates the grant date fair value of stock option awards using the Black-Scholes option pricing model, which considers, among other factors, a risk-free interest rate, the expected life of the award and the historical volatility of the Company's stock price. Cash-settled awards are classified as liabilities with the liability and compensation expense related to cash-settled awards adjusted to fair value at each balance sheet date. | |||
Net Income Per Share | Net Income Per Share | ||
Net income per share is calculated using the two-step method prescribed in U.S. GAAP. Basic net income per share is computed by dividing the net income available to common stockholders for the period by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing the net income (loss) available to common stockholders for the period by the weighted average number of common shares and potential shares of common stock outstanding during the period if their effect is dilutive. The Company uses the treasury stock method to calculate the weighted average shares used in the diluted earnings per share calculation. Potentially dilutive common shares include the assumed exercise of stock options, assumed vesting of restricted stock and, during fiscal years in which Series B Preferred Stock was outstanding, assumed conversion of Series B Preferred Stock using the if-converted method. | |||
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) | ||
For the years ended December 31, 2014, 2013 and 2012, the income tax benefit or provision allocated to items of other comprehensive income was not significant. | |||
Treasury Stock | Treasury Stock | ||
The Company may from time to time utilize treasury stock when vested stock options are exercised, when restricted stock awards are granted and when restricted stock units settle in stock upon vesting. The cost of treasury stock re-issued is determined using the first-in, first-out method. | |||
Business Segments | Business Segments | ||
The Company identifies its reporting segments based on the organizational units used by management to monitor performance and make operating decisions. These reporting segments are as follows: franchise operations, company restaurant operations, rental operations and financing operations. Within the franchise and company restaurant segments, the Company operates two different restaurant concepts, Applebee's and IHOP. Applebee's has no material rental or financing operations. | |||
Franchise Segment | Franchise Segment | ||
As of December 31, 2014, the franchise operations segment consisted of 1,994 restaurants operated by Applebee's franchisees in the United States, two United States territories and 15 countries outside of the United States and 1,639 restaurants operated by IHOP franchisees and area licensees in the United States, two United States territories and eight countries outside of the United States. Franchise operations revenue consists primarily of franchise royalty revenues, sales of proprietary products (primarily IHOP pancake and waffle dry-mixes) and the portion of the franchise fees allocated to IHOP and Applebee's intellectual property. Additionally, franchise fees designated for IHOP's national advertising fund and local marketing and advertising cooperatives are recognized as revenue and expense of franchise operations; however, due to different contractual terms in Applebee's marketing agreements, Applebee's national advertising fund activity constitutes agency transactions and therefore is not recognized as franchise revenue and expense. | |||
Franchise operations expenses include IHOP advertising expense, the cost of proprietary products, pre-opening training expenses and other franchise-related costs. | |||
Company Segment | Company Segment | ||
As of December 31, 2014, the company restaurant operations segment consisted of 23 Applebee's company-operated restaurants, 10 IHOP company-operated restaurants and one IHOP restaurant reacquired from franchisees and operated by the Company on a temporary basis until refranchised. All company-operated restaurants are located in the United States. | |||
Company restaurant sales are retail sales at company-operated restaurants. Company restaurant expenses are operating expenses at company-operated restaurants and include food, beverage, labor, benefits, utilities, rent and other operating costs. | |||
Rental Segment | Rental Segment | ||
Rental operations revenue includes revenue from operating leases and interest income from direct financing leases. Rental operations expenses are costs of operating leases and interest expense of capital leases on franchisee-operated restaurants. The rental operations revenue and expenses are primarily generated by IHOP. Applebee's has an insignificant amount of rental activity related to one property that was retained after refranchising a company-operated restaurant. | |||
Financing Segment | Financing Segment | ||
Financing operations revenue primarily consists of interest income from the financing of IHOP franchise fees and equipment leases, as well as sales of equipment associated with refranchised IHOP restaurants. Financing expenses are the cost of restaurant equipment. | |||
New Accounting Pronouncements | New Accounting Pronouncements | ||
In April 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (“ASU 2014-08”). The amendments in ASU 2014-08 change the criteria for the reporting of discontinued operations. Under ASU 2014-08, only disposals resulting in a strategic shift that will have a major effect on an entity's operations and financial results will be reported as discontinued operations. ASU 2014-08 also removes the requirement under current U.S. GAAP that an entity not have any significant continuing involvement in the operations of the component after disposal to qualify for reporting of the disposal as a discontinued operation. The Company will be required to apply the provisions of ASU 2014-08 prospectively to all disposals of components beginning with its first fiscal quarter of 2015. Early adoption is permitted for any disposal transaction not previously reported. | |||
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The Company will be required to apply the provisions of ASU 2014-09 beginning with its first fiscal quarter of 2017, either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption; early adoption is not permitted. | |||
The guidance in ASU 2014-09 supersedes nearly all of the existing general revenue recognition guidance under U.S. GAAP as well as most industry-specific revenue recognition guidance, including guidance with respect to revenue recognition by franchisors. The Company believes the recognition of the majority of its revenues, including franchise royalty revenues, sales of IHOP pancake and waffle dry mix and retail sales at company-operated restaurants will not be affected by ASU 2014-09. Additionally, lease rental revenues are not within the scope of ASU 2014-09 guidance. The Company is currently evaluating the effect that ASU 2014-09 will have on its financial statements and related disclosures and which method of adoption will be used. | |||
The Company reviewed all other newly issued accounting pronouncements and concluded that they either are not applicable to the Company's operations or that no material effect is expected on the Company's financial statements as a result of future adoption. |
Basis_of_Presentation_and_Summ2
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Accounting Policies [Abstract] | ||||||||||||||||
Property and Equipment Depreciable Lives | The general ranges of depreciable and amortizable lives are as follows: | |||||||||||||||
Category | Depreciable Life | |||||||||||||||
Buildings and improvements | 25 - 40 years | |||||||||||||||
Leaseholds and improvements | Shorter of primary lease term or between three to 40 years | |||||||||||||||
Equipment and fixtures | Two to 10 years | |||||||||||||||
Properties under capital leases | Primary lease term or remaining primary lease term | |||||||||||||||
Fair Value of Financial Instruments | The fair values of non-current financial instruments, determined based on Level 2 inputs, are shown in the following table: | |||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||
Carrying | Fair Value | Carrying | Fair Value | |||||||||||||
Amount | Amount | |||||||||||||||
(In millions) | ||||||||||||||||
Long-term debt, less current maturities | $ | 1,300.00 | $ | 1,302.00 | $ | 1,203.50 | $ | 1,306.20 | ||||||||
Receivables_Tables
Receivables (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Receivables [Abstract] | ||||||||
Schedule of Receivables and Allowance for Doubtful Accounts | ||||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Accounts receivable | $ | 65.9 | $ | 59.4 | ||||
Gift card receivables | 69 | 68.3 | ||||||
Notes receivable | 1.9 | 1.2 | ||||||
Financing receivables: | ||||||||
Equipment leases receivable | 107.3 | 115.1 | ||||||
Direct financing leases receivable | 81.6 | 88.6 | ||||||
Franchise fee notes receivable | 1.3 | 1.7 | ||||||
Other | 10.3 | 10.6 | ||||||
337.3 | 344.8 | |||||||
Less: allowance for doubtful accounts | (2.9 | ) | (3.5 | ) | ||||
334.4 | 341.3 | |||||||
Less: current portion | (153.5 | ) | (144.1 | ) | ||||
Long-term receivables | $ | 180.9 | $ | 197.2 | ||||
The following table summarizes the activity in the allowance for doubtful accounts: | ||||||||
Allowance for Doubtful Accounts | (In millions) | |||||||
Balance at December 31, 2011 | $ | 3.6 | ||||||
Provision | 0.5 | |||||||
Charge-offs | (1.9 | ) | ||||||
Recoveries | 0.5 | |||||||
Balance at December 31, 2012 | 2.7 | |||||||
Provision | 1.5 | |||||||
Charge-offs | (0.7 | ) | ||||||
Recoveries | 0 | |||||||
Balance at December 31, 2013 | 3.5 | |||||||
Provision | 0.5 | |||||||
Charge-offs | (1.1 | ) | ||||||
Balance at December 31, 2014 | $ | 2.9 | ||||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Schedule of Property and Equipment | Property and equipment by category is as follows: | |||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Land | $ | 59.2 | $ | 63.8 | ||||
Buildings and improvements | 58.7 | 60.1 | ||||||
Leaseholds and improvements | 258.3 | 274.9 | ||||||
Equipment and fixtures | 78.4 | 81.8 | ||||||
Construction in progress | 5.1 | 3.6 | ||||||
Properties under capital lease | 59.2 | 60 | ||||||
Property and equipment, gross | 518.9 | 544.3 | ||||||
Less: accumulated depreciation and amortization | (277.7 | ) | (270.0 | ) | ||||
Property and equipment, net | $ | 241.2 | $ | 274.3 | ||||
Other_Intangible_Assets_Other_
Other Intangible Assets Other Intangible Assets (Tables) | 12 Months Ended | |||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||||||||||||||||||||||||||||
Other Intangible Assets Roll Forward | As of December 31, 2014 and 2013, intangible assets were as follows: | |||||||||||||||||||||||||||
Not Subject to Amortization | Subject to Amortization | |||||||||||||||||||||||||||
Tradename | Liquor | Other | Franchising | Recipes and | Leaseholds | Total | ||||||||||||||||||||||
Licenses | Rights | Menus | ||||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||
Balance at December 31, 2011 | $ | 652.4 | $ | 1.5 | $ | 0.5 | $ | 159.3 | $ | 6.6 | $ | 2.1 | $ | 822.4 | ||||||||||||||
Amortization expense | — | — | — | (10.0 | ) | (2.3 | ) | (0.2 | ) | (12.5 | ) | |||||||||||||||||
Refranchising | — | (1.5 | ) | (0.1 | ) | (0.3 | ) | — | (1.9 | ) | (3.8 | ) | ||||||||||||||||
Other | — | — | — | — | — | — | ||||||||||||||||||||||
Balance at December 31, 2012 | 652.4 | — | 0.4 | 149 | 4.3 | — | 806.1 | |||||||||||||||||||||
Amortization expense | — | — | — | (10.0 | ) | (2.3 | ) | — | (12.3 | ) | ||||||||||||||||||
Other | — | — | 0.3 | — | — | — | 0.3 | |||||||||||||||||||||
Balance at December 31, 2013 | 652.4 | — | 0.7 | 139 | 2 | — | 794.1 | |||||||||||||||||||||
Amortization expense | — | — | — | (10.0 | ) | (2.0 | ) | — | (12.0 | ) | ||||||||||||||||||
Other | — | — | 0.2 | — | — | — | 0.2 | |||||||||||||||||||||
Balance at December 31, 2014 | $ | 652.4 | $ | — | $ | 0.9 | $ | 129 | $ | — | $ | — | $ | 782.3 | ||||||||||||||
Schedule of Finite-Lived Intangible Assets by Major Class | Gross and net carrying amounts of intangible assets subject to amortization at December 31, 2014 and 2013 are as follows: | |||||||||||||||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||||||||||||||
Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||||
Amortization | Amortization | |||||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||
Franchising rights | $ | 200 | $ | (71.0 | ) | $ | 129 | $ | 200 | $ | (61.0 | ) | $ | 139 | ||||||||||||||
Recipes and menus | 15.7 | (15.7 | ) | — | 15.7 | (13.7 | ) | 2 | ||||||||||||||||||||
Leaseholds/other | 0.3 | (0.3 | ) | — | 0.3 | (0.3 | ) | — | ||||||||||||||||||||
Total | $ | 216 | $ | (87.0 | ) | $ | 129 | $ | 216 | $ | (75.0 | ) | $ | 141 | ||||||||||||||
Debt_Tables
Debt (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Schedule of Debt Components | Long-term debt consists of the following components: | |||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Series 2014-1 Class A-2 4.227% Fixed Rate Senior Secured Notes | $ | 1,300.00 | $ | — | ||||
Senior Secured Credit Facility, due October 2017, at a variable interest rate of 3.75% and 4.25% as of December 31, 2013 and 2012, respectively | — | 467.2 | ||||||
Senior Notes due October 2018, at a fixed rate of 9.5% | — | 760.8 | ||||||
Discount | — | (19.7 | ) | |||||
Total debt | 1,300.00 | 1,208.20 | ||||||
Less: current maturities | — | (4.7 | ) | |||||
Long-term debt | $ | 1,300.00 | $ | 1,203.50 | ||||
Financing_Obligations_Tables
Financing Obligations (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Financing Obligations [Abstract] | ||||
Schedule of Sale Leaseback Transactions | As of December 31, 2014, future minimum lease payments under financing obligations during the initial terms of the leases related to the sale-leaseback transactions are as follows: | |||
Fiscal Years | (In millions) | |||
2015 (1) | $ | 5.4 | ||
2016 | 5 | |||
2017 (1) | 4.6 | |||
2018 | 5.2 | |||
2019 | 5.5 | |||
Thereafter | 75.8 | |||
Total minimum lease payments | 101.5 | |||
Less: interest | (58.8 | ) | ||
Total financing obligations | 42.7 | |||
Less: current portion(2) | (0.1 | ) | ||
Long-term financing obligations | $ | 42.6 | ||
____________________________________________________________________________________ | ||||
(1) | Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in fiscal 2015 and 11 monthly payments in fiscal 2017. | |||
(2) | Included in current maturities of capital lease and financing obligations on the consolidated balance sheet. |
Leases_Tables
Leases (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Lease [Line Items] | ||||||||
Schedule of Future Minimum Payments for Capital and Operating Leases | The following are minimum future lease payments on noncancelable leases as lessee at December 31, 2014: | |||||||
Capital | Operating | |||||||
Leases | Leases | |||||||
(In millions) | ||||||||
2015 (1) | $ | 26.2 | $ | 83.5 | ||||
2016 | 24 | 75.9 | ||||||
2017 (1) | 21.4 | 68.4 | ||||||
2018 | 20.6 | 72.6 | ||||||
2019 | 17.2 | 68.4 | ||||||
Thereafter | 58.7 | 328.5 | ||||||
Total minimum lease payments | 168.1 | $ | 697.3 | |||||
Less: interest | (55.3 | ) | ||||||
Capital lease obligations | 112.8 | |||||||
Less: current portion (2) | (14.7 | ) | ||||||
Long-term capital lease obligations | $ | 98.1 | ||||||
______________________________________________________ | ||||||||
(1) Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in fiscal 2015 and 11 monthly payments in fiscal 2017. | ||||||||
(2) Included in current maturities of capital lease and financing obligations on the consolidated balance sheet. | ||||||||
Schedule of Future Minimum Rents to Be Received on Capital and Operating Leases | The minimum future lease payments shown above have not been reduced by the following future minimum rents to be received on noncancelable subleases and leases of owned property at December 31, 2014: | |||||||
Direct | Operating | |||||||
Financing | Leases | |||||||
Leases | ||||||||
(In millions) | ||||||||
2015 (1) | $ | 18.3 | $ | 101.5 | ||||
2016 | 17.8 | 99.7 | ||||||
2017 (1) | 17.9 | 99.6 | ||||||
2018 | 17.5 | 98.9 | ||||||
2019 | 16.3 | 97.1 | ||||||
Thereafter | 38.9 | 555.8 | ||||||
Total minimum rents receivable | $ | 126.7 | $ | 1,052.60 | ||||
________________________________________________________________________ | ||||||||
(1) Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in fiscal 2015 and 11 monthly payments in fiscal 2017. | ||||||||
Direct financing leases receivable | ||||||||
Lease [Line Items] | ||||||||
Leases Receivable | The following is the Company's net investment in direct financing lease receivables: | |||||||
December 31, | ||||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Total minimum rents receivable | $ | 126.7 | $ | 144.8 | ||||
Less: unearned income | (45.1 | ) | (56.2 | ) | ||||
Net investment in direct financing lease receivables | 81.6 | 88.6 | ||||||
Less: current portion | (8.0 | ) | (7.0 | ) | ||||
Long-term direct financing lease receivables | $ | 73.6 | $ | 81.6 | ||||
Net investment equipment lease | ||||||||
Lease [Line Items] | ||||||||
Leases Receivable | The following is the Company's net investment in equipment leases receivable: | |||||||
December 31, | ||||||||
2014 | 2013 | |||||||
(In millions) | ||||||||
Total minimum leases receivable | $ | 165.4 | $ | 184.2 | ||||
Less: unearned income | (58.1 | ) | (69.1 | ) | ||||
Net investment in equipment leases receivables | 107.3 | 115.1 | ||||||
Less: current portion | (7.4 | ) | (7.1 | ) | ||||
Long-term equipment leases receivable | $ | 99.9 | $ | 108 | ||||
Preferred_Stock_and_Stockholde1
Preferred Stock and Stockholders' Equity Preferred (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Preferred Stock and Stockholders' Equity [Abstract] | ||||||||||||
Dividends Declared | During the fiscal years ended December 31, 2014 and 2013, the Company declared and paid dividends on our common stock as follows: | |||||||||||
Year ended December 31, 2014 | Declaration date | Payment date | Dividend per share | Total(1) | ||||||||
(In millions) | ||||||||||||
First quarter | 25-Feb-14 | 28-Mar-14 | $ | 0.75 | $ | 14.3 | ||||||
Second quarter | 28-May-14 | 27-Jun-14 | 0.75 | 14.3 | ||||||||
Third quarter | 4-Aug-14 | 26-Sep-14 | 0.75 | 14.2 | ||||||||
Fourth quarter | 27-Oct-14 | -2 | 0.875 | — | ||||||||
Total | $ | 3.125 | $ | 42.8 | ||||||||
Year ended December 31, 2013 | ||||||||||||
First quarter | 26-Feb-13 | 29-Mar-13 | $ | 0.75 | $ | 14.6 | ||||||
Second quarter | 14-May-13 | 28-Jun-13 | 0.75 | 14.4 | ||||||||
Third quarter | 2-Aug-13 | 27-Sep-13 | 0.75 | 14.3 | ||||||||
Fourth quarter | 3-Oct-13 | 27-Dec-13 | 0.75 | 14.3 | ||||||||
Total | $ | 3 | $ | 57.6 | ||||||||
___________________________________________________ | ||||||||||||
(1) Includes dividend equivalents paid on restricted stock units | ||||||||||||
(2) The fourth quarter 2014 dividend of $16.6 million was paid on January 9, 2015. |
Closure_and_Impairment_Charges1
Closure and Impairment Charges (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Impairments and Closure Charges [Abstract] | ||||||||||||
Schedule of Impairment and Closure Charges | Closure and impairment charges for the years ended December 31, 2014, 2013 and 2012 were as follows: | |||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(In millions) | ||||||||||||
Closure charges | $ | 2.1 | $ | 1 | $ | 2.3 | ||||||
Long-lived tangible asset impairment | 1.6 | 0.8 | 1.9 | |||||||||
Total closure and impairment charges | $ | 3.7 | $ | 1.8 | $ | 4.2 | ||||||
StockBased_Incentive_Plans_Tab
Stock-Based Incentive Plans (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs | The following table summarizes the Company's stock-based compensation expense included as a component of general and administrative expenses in the consolidated financial statements: | |||||||||||||
Year Ended December 31, | ||||||||||||||
2014 | 2013 | 2012 | ||||||||||||
(In millions) | ||||||||||||||
Total stock-based compensation expense: | ||||||||||||||
Equity classified awards | $ | 9.4 | $ | 9.4 | $ | 11.4 | ||||||||
Liability classified awards | 2.4 | 0.9 | 4.8 | |||||||||||
Total pre-tax stock-based compensation expense | 11.8 | 10.3 | 16.3 | |||||||||||
Tax benefit | (4.5 | ) | (3.9 | ) | (6.2 | ) | ||||||||
Total stock-based compensation expense, net of tax | $ | 7.3 | $ | 6.4 | $ | 10.1 | ||||||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The following table summarizes the assumptions used to value options granted in the respective periods: | |||||||||||||
2014 | 2013 | 2012 | ||||||||||||
Risk free interest rate | 1.6 | % | 0.8 | % | 0.9 | % | ||||||||
Weighted average historical volatility | 51.1 | % | 83.4 | % | 84.5 | % | ||||||||
Dividend yield | 3.7 | % | 4.2 | % | — | % | ||||||||
Expected years until exercise | 4.6 | 4.6 | 4.7 | |||||||||||
Forfeitures | 11 | % | 11 | % | 11 | % | ||||||||
Weighted average fair value of options granted | $ | 26.87 | $ | 36 | $ | 33.53 | ||||||||
Schedule of Share-based Compensation, Stock Options, Activity | Stock option activity for the years ended December 31, 2014, 2013 and 2012 is summarized as follows: | |||||||||||||
Number of | Weighted Average | Weighted Average | Aggregate Intrinsic | |||||||||||
Shares Under Option | Exercise Price | Remaining Contractual | Value (in Millions) | |||||||||||
Per Share | Term (in Years) | |||||||||||||
Outstanding at December 31, 2011 | 1,318,640 | $ | 32.06 | |||||||||||
Granted | 147,674 | 51.63 | ||||||||||||
Exercised | (455,217 | ) | 20.91 | |||||||||||
Forfeited | (39,381 | ) | 46.97 | |||||||||||
Expired | (13,470 | ) | 38.64 | |||||||||||
Outstanding at December 31, 2012 | 958,246 | 39.67 | ||||||||||||
Granted | 81,328 | 72.28 | ||||||||||||
Exercised | (225,272 | ) | 40.31 | |||||||||||
Forfeited | (39,243 | ) | 55.78 | |||||||||||
Outstanding at December 31, 2013 | 775,059 | 42.09 | ||||||||||||
Granted | 120,932 | 81.53 | ||||||||||||
Exercised | (256,910 | ) | 31.95 | |||||||||||
Forfeited | (20,966 | ) | 69.18 | |||||||||||
Outstanding at December 31, 2014 | 618,115 | $ | 53.1 | 6 | $ | 31.2 | ||||||||
Vested and Expected to Vest at December 31, 2014 | 600,708 | $ | 52.36 | 5.9 | $ | 30.8 | ||||||||
Exercisable at December 31, 2014 | 433,793 | $ | 44.09 | 4.8 | $ | 25.8 | ||||||||
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | Activity in equity classified awards of restricted stock and restricted stock units for the years ended December 31, 2014, 2013 and 2012 is as follows: | |||||||||||||
Shares of Restricted Stock | Weighted | Restricted | Weighted | |||||||||||
Average | Stock Units | Average | ||||||||||||
Grant-Date Per | Grant-Date | |||||||||||||
Share | Per Share | |||||||||||||
Fair Value | Fair Value | |||||||||||||
Outstanding at December 31, 2011 | 486,533 | $ | 31.08 | 18,000 | $ | 29.32 | ||||||||
Granted | 137,852 | 52.23 | 19,152 | 52.23 | ||||||||||
Released | (179,465 | ) | 13.83 | (3,910 | ) | 40.58 | ||||||||
Forfeited | (98,357 | ) | 44.4 | — | — | |||||||||
Outstanding at December 31, 2012 | 346,563 | 44.74 | 33,242 | 41.19 | ||||||||||
Granted | 97,812 | 73.11 | 15,804 | 72.04 | ||||||||||
Conversion of cash-settled restricted stock units | — | — | 37,184 | 72.28 | ||||||||||
Released | (117,075 | ) | 30.96 | (39,000 | ) | 54.66 | ||||||||
Forfeited | (61,048 | ) | 55.37 | — | — | |||||||||
Outstanding at December 31, 2013 | 266,252 | 58.87 | 47,230 | 64.57 | ||||||||||
Granted | 102,618 | 82.18 | 13,879 | 81.65 | ||||||||||
Released | (94,798 | ) | 53.03 | (19,487 | ) | 70.82 | ||||||||
Forfeited | (40,254 | ) | 67.68 | — | — | |||||||||
Outstanding at December 31, 2014 | 233,818 | $ | 70.14 | 41,622 | $ | 66.92 | ||||||||
Schedule of Share-based Compensation, Restricted Stock Units Award Activity | Activity in liability classified awards of restricted stock units for the years ended December 31, 2013 and 2012 is as follows: | |||||||||||||
Cash-Settled Restricted Stock Units | Weighted | |||||||||||||
Average | ||||||||||||||
Per Share | ||||||||||||||
Fair Value | ||||||||||||||
Outstanding at December 31, 2011 | 41,957 | 64.26 | ||||||||||||
Granted | — | — | ||||||||||||
Released | (4,773 | ) | 49.66 | |||||||||||
Outstanding at December 31, 2012 | 37,184 | 66.13 | ||||||||||||
Conversion to stock-settled restricted stock units | (37,184 | ) | 72.28 | |||||||||||
Outstanding at December 31, 2013 | — | |||||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
Schedule of Components of Income Tax Expense (Benefit) | The provision (benefit) for income taxes for the years ended December 31, 2014, 2013 and 2012 was as follows: | |||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(In millions) | ||||||||||||
Provision (benefit) for income taxes: | ||||||||||||
Current | ||||||||||||
Federal | $ | 33.2 | $ | 48.5 | $ | 77.4 | ||||||
State | 3.6 | 2.1 | 1.9 | |||||||||
Foreign | 2.7 | 2.4 | 1.8 | |||||||||
39.5 | 53 | 81.1 | ||||||||||
Deferred | ||||||||||||
Federal | (22.1 | ) | (13.5 | ) | (12.2 | ) | ||||||
State | (2.3 | ) | (0.9 | ) | (1.7 | ) | ||||||
(24.4 | ) | (14.4 | ) | (13.9 | ) | |||||||
Provision for income taxes | $ | 15.1 | $ | 38.6 | $ | 67.2 | ||||||
Schedule of Effective Income Tax Rate Reconciliation | The provision for income taxes differs from the expected federal income tax rates as follows: | |||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Statutory federal income tax rate | 35 | % | 35 | % | 35 | % | ||||||
State and other taxes, net of federal tax benefit | 2.4 | 2.9 | 2.8 | |||||||||
Change in unrecognized tax benefits | 2.4 | 1.4 | (0.2 | ) | ||||||||
Change in valuation allowance | — | (2.7 | ) | 0.7 | ||||||||
Domestic production activity deduction | (6.0 | ) | — | — | ||||||||
Research and experimentation tax credit | (3.4 | ) | — | — | ||||||||
State adjustments including audits and settlements | (1.1 | ) | (1.1 | ) | 0.2 | |||||||
Compensation related tax credits, net of deduction offsets | (0.8 | ) | (0.6 | ) | (0.9 | ) | ||||||
Changes in tax rates and state tax laws | — | — | (3.2 | ) | ||||||||
Other | 0.8 | — | 0.1 | |||||||||
Effective tax rate | 29.3 | % | 34.9 | % | 34.5 | % | ||||||
Schedule of Deferred Tax Assets and Liabilities | Net deferred tax assets (liabilities) consisted of the following components: | |||||||||||
2014 | 2013 | |||||||||||
(In millions) | ||||||||||||
Differences in capitalization and depreciation and amortization of reacquired franchises and equipment | $ | 4.8 | $ | 4.8 | ||||||||
Differences in acquisition financing costs | 1.8 | 1.8 | ||||||||||
Employee compensation | 14.4 | 15 | ||||||||||
Deferred gain on sale of assets | 6.5 | 6.3 | ||||||||||
Book/tax difference in revenue recognition | 39.6 | 29.8 | ||||||||||
Other | 35.9 | 35 | ||||||||||
Deferred tax assets | 103 | 92.7 | ||||||||||
Valuation allowance | (1.1 | ) | (1.1 | ) | ||||||||
Total deferred tax assets after valuation allowance | 101.9 | 91.6 | ||||||||||
Differences between financial and tax accounting in the recognition of franchise and equipment sales | (48.0 | ) | (51.2 | ) | ||||||||
Differences in capitalization and depreciation (1) | (294.6 | ) | (301.1 | ) | ||||||||
Differences in acquisition financing costs | — | (7.1 | ) | |||||||||
Book/tax difference in revenue recognition | (15.6 | ) | (19.5 | ) | ||||||||
Differences between book and tax basis of property and equipment | (11.4 | ) | (10.1 | ) | ||||||||
Other | (20.5 | ) | (20.3 | ) | ||||||||
Deferred tax liabilities | (390.1 | ) | (409.3 | ) | ||||||||
Net deferred tax liabilities | $ | (288.2 | ) | $ | (317.7 | ) | ||||||
Net deferred tax asset—current | $ | 31.2 | $ | 24.2 | ||||||||
Valuation allowance—current | (0.3 | ) | (0.3 | ) | ||||||||
Net deferred tax asset—current | 30.9 | 23.9 | ||||||||||
Deferred tax liability—non-current | (318.3 | ) | (340.8 | ) | ||||||||
Valuation allowance—non-current | (0.8 | ) | (0.8 | ) | ||||||||
Net deferred tax liability—non-current | (319.1 | ) | (341.6 | ) | ||||||||
Net deferred tax liabilities | $ | (288.2 | ) | $ | (317.7 | ) | ||||||
_____________________________________ | ||||||||||||
(1) | Primarily related to the Applebee's acquisition. | |||||||||||
Summary of Income Tax Contingencies | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Unrecognized tax benefit as of January 1 | $ | 2.7 | $ | 6.7 | $ | 8.2 | ||||||
Changes for tax positions of prior years | 1.2 | 0.8 | 0.8 | |||||||||
Increases for tax positions related to the current year | 0.1 | — | 0.2 | |||||||||
Decreases relating to settlements and lapsing of statutes of limitations | (0.6 | ) | (4.8 | ) | (2.5 | ) | ||||||
Unrecognized tax benefit as of December 31 | $ | 3.4 | $ | 2.7 | $ | 6.7 | ||||||
Net_Income_Per_Share_Tables
Net Income Per Share (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Earnings Per Share [Abstract] | ||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The computation of the Company's basic and diluted net income per share is as follows: | |||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(In thousands, except per share data) | ||||||||||||
Numerator for basic and diluted income per common share: | ||||||||||||
Net income | $ | 36,453 | $ | 72,037 | $ | 127,674 | ||||||
Less: Accretion of Series B preferred stock | — | — | (2,498 | ) | ||||||||
Less: Net income allocated to unvested participating restricted stock | (521 | ) | (1,200 | ) | (2,718 | ) | ||||||
Net income available to common stockholders - basic | 35,932 | 70,837 | 122,458 | |||||||||
Effect of unvested participating restricted stock | — | 4 | 127 | |||||||||
Effect of dilutive securities: | ||||||||||||
Convertible Series B preferred stock | — | — | 2,498 | |||||||||
Numerator - net income available to common shareholders - diluted | $ | 35,932 | $ | 70,841 | $ | 125,083 | ||||||
Denominator: | ||||||||||||
Weighted average outstanding shares of common stock - basic | 18,753 | 18,871 | 17,992 | |||||||||
Effect of dilutive securities: | ||||||||||||
Stock options | 203 | 270 | 264 | |||||||||
Convertible Series B preferred stock | — | — | 621 | |||||||||
Weighted average outstanding shares of common stock - diluted | 18,956 | 19,141 | 18,877 | |||||||||
Net income per common share: | ||||||||||||
Basic | $ | 1.92 | $ | 3.75 | $ | 6.81 | ||||||
Diluted | $ | 1.9 | $ | 3.7 | $ | 6.63 | ||||||
Segment_Reporting_Tables
Segment Reporting (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
Schedule of Segment Reporting Information, by Segment | Information on segments and a reconciliation to income (loss) before income taxes are as follows: | |||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Revenues | (In millions) | |||||||||||
Franchise operations | $ | 456.1 | $ | 439.2 | $ | 421.4 | ||||||
Company restaurants | 62.5 | 63.4 | 291.1 | |||||||||
Rental operations | 122.9 | 124.8 | 122.9 | |||||||||
Financing operations | 13.5 | 13.1 | 14.5 | |||||||||
Total | $ | 655 | $ | 640.5 | $ | 849.9 | ||||||
Income (loss) before income taxes | ||||||||||||
Franchise operations | $ | 334.3 | $ | 329.5 | $ | 311.5 | ||||||
Company restaurants | (0.2 | ) | (0.2 | ) | 41.8 | |||||||
Rental operations | 28.3 | 27.5 | 25.7 | |||||||||
Financing operations | 12.7 | 12.9 | 12.9 | |||||||||
Corporate | (323.5 | ) | (259.1 | ) | (197.0 | ) | ||||||
Income (loss) before income taxes | $ | 51.6 | $ | 110.6 | $ | 194.9 | ||||||
Interest expense | ||||||||||||
Company restaurants | $ | 0.4 | $ | 0.4 | $ | 0.4 | ||||||
Rental operations | 14.7 | 15.7 | 17 | |||||||||
Corporate | 96.6 | 100.3 | 114.3 | |||||||||
Total | $ | 111.7 | $ | 116.4 | $ | 131.7 | ||||||
Depreciation and amortization | ||||||||||||
Franchise operations | $ | 10.4 | $ | 10.8 | $ | 9.8 | ||||||
Company restaurants | 2.1 | 2.2 | 6.9 | |||||||||
Rental operations | 13.2 | 13.4 | 13.6 | |||||||||
Corporate | 9 | 9 | 9.2 | |||||||||
Total | $ | 34.7 | $ | 35.4 | $ | 39.5 | ||||||
Closure and impairment charges | ||||||||||||
Company restaurants | $ | 3.7 | $ | 1.8 | $ | 4.2 | ||||||
Total | $ | 3.7 | $ | 1.8 | $ | 4.2 | ||||||
Capital expenditures | ||||||||||||
Company restaurants | $ | 1.5 | $ | 1.3 | $ | 9.5 | ||||||
Corporate | 4.4 | 5.7 | 7.5 | |||||||||
Total | $ | 5.9 | $ | 7 | $ | 17 | ||||||
Goodwill (franchise segment) | $ | 697.5 | $ | 697.5 | $ | 697.5 | ||||||
Total assets | ||||||||||||
Franchise operations | $ | 1,635.00 | $ | 1,606.40 | $ | 1,523.00 | ||||||
Company restaurants | 177.7 | 191.6 | 186.2 | |||||||||
Rental operations | 344.3 | 364 | 397.3 | |||||||||
Financing operations | 109.9 | 117.1 | 125.4 | |||||||||
Corporate | 181.2 | 125.5 | 183.5 | |||||||||
Total | $ | 2,448.10 | $ | 2,404.60 | $ | 2,415.40 | ||||||
Selected_Quarterly_Financial_D1
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||
Schedule of Quarterly Financial Information | ||||||||||||||||||||
Revenues(1) | Operating | Net Income (Loss) | Net Income | Net Income | ||||||||||||||||
Margin | (Loss) | (Loss) | ||||||||||||||||||
Per Share— | Per Share— | |||||||||||||||||||
Basic(2) | Diluted(2) | |||||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||
2014 | ||||||||||||||||||||
1st Quarter | $ | 167,201 | $ | 97,072 | $ | 20,824 | $ | 1.09 | $ | 1.08 | ||||||||||
2nd Quarter | 160,521 | 94,473 | 19,167 | 1 | 1 | |||||||||||||||
3rd Quarter | 162,853 | 91,629 | 18,887 | 0.99 | 0.99 | |||||||||||||||
4th Quarter (1) | 164,413 | 91,941 | (22,425 | ) | (1.18 | ) | n/a | |||||||||||||
2013 | ||||||||||||||||||||
1st Quarter | $ | 163,169 | $ | 94,424 | $ | 18,239 | $ | 0.95 | $ | 0.93 | ||||||||||
2nd Quarter | 158,114 | 91,026 | 16,937 | 0.88 | 0.87 | |||||||||||||||
3rd Quarter | 161,283 | 93,043 | 18,730 | 0.98 | 0.97 | |||||||||||||||
4th Quarter | 157,901 | 91,199 | 18,131 | 0.95 | 0.94 | |||||||||||||||
______________________________________________________________________________________________________ | ||||||||||||||||||||
(1) Net income was impacted by loss on extinguishment of debt related to the Company's refinancing of its long-term debt. See Note 7 of Notes to Consolidated Financial Statements. | ||||||||||||||||||||
(2) The quarterly amounts may not add to the full year amount as each quarterly calculation is discrete from the full-year calculation. |
The_Company_Details
The Company (Details) | Dec. 31, 2014 |
restaurant_concept | |
Entity Information [Line Items] | |
Number of Restaurant Concepts | 2 |
IHOP | |
Entity Information [Line Items] | |
Number of restaurants | 1,650 |
Number of States in which Entity Operates | 50 |
Number of territories in which entity operates | 2 |
Number of countries in which entity operates | 8 |
IHOP | Franchised | |
Entity Information [Line Items] | |
Number of restaurants | 1,472 |
IHOP | Company Operated | |
Entity Information [Line Items] | |
Number of restaurants | 11 |
IHOP | Licensing Agreements | |
Entity Information [Line Items] | |
Number of restaurants | 167 |
Applebee's | |
Entity Information [Line Items] | |
Number of restaurants | 2,017 |
Number of States in which Entity Operates | 49 |
Number of territories in which entity operates | 2 |
Number of countries in which entity operates | 15 |
Applebee's | Franchised | |
Entity Information [Line Items] | |
Number of restaurants | 1,994 |
Applebee's | Company Operated | |
Entity Information [Line Items] | |
Number of restaurants | 23 |
Basis_of_Presentation_and_Summ3
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2007 | Dec. 31, 2011 | |
revenue_category | segment | ||||
segment | |||||
restaurant_concept | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of weeks in fiscal year | 364 days | 364 days | 364 days | ||
Cash and cash equivalents | $104,004,000 | $106,011,000 | $64,537,000 | $60,691,000 | |
Restricted cash included in other current assets | 52,262,000 | 664,000 | |||
Restricted cash included in other noncurrent assets | 14,700,000 | ||||
Other restricted assets | 1,200,000 | 1,900,000 | |||
Number of Reporting Units | 3 | ||||
Goodwill and Intangible Asset Impairment | 0 | 0 | 0 | ||
Category of Revenue, Number | 4 | ||||
Advertising expense | 2,900,000 | 2,900,000 | 13,100,000 | ||
Number of Restaurant Concepts | 2 | ||||
Building improvements | Minimum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Useful life of property and equipment | 25 years | ||||
Building improvements | Maximum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Useful life of property and equipment | 40 years | ||||
Leaseholds and improvements | Minimum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Useful life of property and equipment | 3 years | ||||
Leaseholds and improvements | Maximum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Useful life of property and equipment | 40 years | ||||
Equipment and fixtures | Minimum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Useful life of property and equipment | 2 years | ||||
Equipment and fixtures | Maximum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Useful life of property and equipment | 10 years | ||||
Applebee's | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 2,017 | ||||
Number of Reporting Units | 2 | ||||
Gift card breakage revenue | 100,000 | 200,000 | 1,300,000 | ||
Property Subject to or Available for Operating Lease, Number of Units | 1 | ||||
Number of territories in which entity operates | 2 | ||||
Number of countries in which entity operates | 15 | ||||
Applebee's | Minimum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 10 years | ||||
Lessor Leasing Arrangements, Operating Leases, Renewal Term | 5 years | ||||
Applebee's | Maximum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 20 years | ||||
Lessor Leasing Arrangements, Operating Leases, Renewal Term | 20 years | ||||
IHOP | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 1,650 | ||||
Property Subject to or Available for Operating Lease, Number of Units | 709 | ||||
Lessor Leasing Arrangements, Operating Leases, Renewal Term | 5 years | ||||
Advertising expense included in franchise revenue and expense | 90,300,000 | 79,500,000 | 76,400,000 | ||
Number of territories in which entity operates | 2 | ||||
Number of countries in which entity operates | 8 | ||||
IHOP | Minimum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 15 years | ||||
IHOP | Maximum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 25 years | ||||
Franchised | Applebee's | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 1,994 | ||||
Franchised | IHOP | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 1,472 | ||||
Company Operated | Applebee's | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 23 | ||||
Company Operated | IHOP | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 11 | ||||
Number of restaurants reacquired and operated by the company until refranchised | 1 | ||||
Company Operated Excluding Restaurants Reacquired to be Refranchised | IHOP | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 10 | ||||
Franchised Units or Licensing Agreements | IHOP | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | 1,639 | ||||
Prepaid Advertising and Gift Cards | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Cash and cash equivalents | 56,200,000 | 53,200,000 | |||
Held in Trust Deposits | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Restricted cash included in other current assets | 52,100,000 | ||||
Held for Advertising Activity Deposits | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Restricted cash included in other current assets | 200,000 | ||||
Revenue from Rights Concentration Risk | Accounts Receivable | Largest Franchisees | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of franchisees | 15 | ||||
Number of restaurants | 1,693 | ||||
Concentration risk by percentage | 49.00% | ||||
Net accounts receivable | $50,700,000 | ||||
Revenue from Rights Concentration Risk | Accounts Receivable | Largest Franchisees | Minimum | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of restaurants per franchisee | 54 | ||||
Revenue from Rights Concentration Risk | Accounts Receivable | Largest Franchisees | Applebee's | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of franchisees | 11 | ||||
Revenue from Rights Concentration Risk | Accounts Receivable | Largest Franchisees | IHOP | |||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||||
Number of franchisees | 4 |
Basis_of_Presentation_and_Summ4
Basis of Presentation and Summary of Significant Accounting Policies - Fair Value of Financial Instruments (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | $1,300,000,000 | $1,203,517,000 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, less current maturities at fair value | $1,302,000,000 | $1,306,200,000 |
Receivables_Details
Receivables (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Accounts, Notes, Loans and Financing Receivable, Classified [Abstract] | |||
Accounts receivable | $65,900,000 | $59,400,000 | |
Gift card receivables | 69,000,000 | 68,300,000 | |
Notes receivable | 1,900,000 | 1,200,000 | |
Other | 10,300,000 | 10,600,000 | |
Receivables | 337,300,000 | 344,800,000 | |
Less: allowance for doubtful accounts | -2,900,000 | -3,500,000 | -2,700,000 |
Receivables, net | 334,400,000 | 341,300,000 | |
Less: current portion | -153,498,000 | -144,137,000 | |
Long-term receivables | 180,856,000 | 197,153,000 | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Beginning of Period | 3,500,000 | 2,700,000 | 3,600,000 |
Provisions | 500,000 | 1,500,000 | 500,000 |
Charge-offs | -1,100,000 | -700,000 | -1,900,000 |
Recoveries | 0 | 500,000 | |
Ending of Period | 2,900,000 | 3,500,000 | 2,700,000 |
Amount of Financing Receivables Delinquent | 400,000 | 400,000 | |
Amount of Financing Receivables Included in Allowance for Doubtful Accounts | 300,000 | 300,000 | |
Minimum | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Financing Franchise Fee Notes Receivable Lease Term | 5 years | ||
Maximum | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Financing Franchise Fee Notes Receivable Lease Term | 8 years | ||
IHOP | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Equipment Lease Receivable Average Annual Interest Rate | 9.80% | 9.80% | |
Franchise Fee Notes Receivable, Average Annual Interest Rate | 6.40% | 6.60% | |
Equipment leases receivable | |||
Accounts, Notes, Loans and Financing Receivable, Classified [Abstract] | |||
Financing receivable | 107,300,000 | 115,100,000 | |
Direct financing leases receivable | |||
Accounts, Notes, Loans and Financing Receivable, Classified [Abstract] | |||
Financing receivable | 81,600,000 | 88,600,000 | |
Franchise fee notes receivable | |||
Accounts, Notes, Loans and Financing Receivable, Classified [Abstract] | |||
Financing receivable | $1,300,000 | $1,700,000 |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Property and Equipment [Line Items] | |||
Property and equipment, gross | $518,900,000 | $544,300,000 | |
Less accumulated depreciation and amortization | 277,700,000 | 270,000,000 | |
Property and equipment, net | 241,229,000 | 274,295,000 | |
Depreciation expense on property equipment | 22,700,000 | 23,100,000 | 27,900,000 |
Land | |||
Property and Equipment [Line Items] | |||
Property and equipment, gross | 59,200,000 | 63,800,000 | |
Building improvements | |||
Property and Equipment [Line Items] | |||
Property and equipment, gross | 58,700,000 | 60,100,000 | |
Leaseholds and improvements | |||
Property and Equipment [Line Items] | |||
Property and equipment, gross | 258,300,000 | 274,900,000 | |
Equipment and fixtures | |||
Property and Equipment [Line Items] | |||
Property and equipment, gross | 78,400,000 | 81,800,000 | |
Construction in progress | |||
Property and Equipment [Line Items] | |||
Property and equipment, gross | 5,100,000 | 3,600,000 | |
Properties under capital lease obligations | |||
Property and Equipment [Line Items] | |||
Property and equipment, gross | 59,200,000 | 60,000,000 | |
Less accumulated depreciation and amortization | $36,800,000 | $34,700,000 |
Goodwill_Details
Goodwill (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Goodwill [Line Items] | |||
Goodwill | $697,470,000 | $697,470,000 | $697,470,000 |
Applebee's | |||
Goodwill [Line Items] | |||
Goodwill | 686,700,000 | 686,700,000 | |
Goodwill, Impairment Loss | 0 | 0 | |
IHOP | |||
Goodwill [Line Items] | |||
Goodwill | 10,800,000 | 10,800,000 | |
Goodwill, Impairment Loss | $0 | $0 |
Other_Intangible_Assets_Other_1
Other Intangible Assets - Other Intangible Assets Roll Forward (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Finite and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Finite lived, beginning of period | $141,000,000 | |||
Total other intangible assets, beginning of period | 794,057,000 | 806,100,000 | 822,400,000 | |
Finite lived, amortization expense | -12,000,000 | -12,300,000 | -12,500,000 | |
Refranchising | -3,800,000 | |||
Other | 200,000 | 300,000 | 0 | |
Finite lived, end of period | 129,000,000 | 141,000,000 | ||
Total other intangible assets, end of period | 782,336,000 | 794,057,000 | 806,100,000 | |
Tradename | Not Subject to Amortization | ||||
Finite and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Indefinite lived, beginning of period | 652,400,000 | |||
Indefinite lived, end of period | 652,400,000 | 652,400,000 | 652,400,000 | 652,400,000 |
Liquor Licenses | Not Subject to Amortization | ||||
Finite and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Indefinite lived, beginning of period | 1,500,000 | |||
Refranchising | -1,500,000 | |||
Indefinite lived, end of period | 0 | 0 | 0 | |
Other | Not Subject to Amortization | ||||
Finite and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Indefinite lived, beginning of period | 700,000 | 400,000 | 500,000 | |
Refranchising | -100,000 | |||
Indefinite lived, other | 200,000 | 300,000 | ||
Indefinite lived, end of period | 900,000 | 700,000 | 400,000 | |
Franchising Rights | Subject to Amortization | ||||
Finite and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Finite lived, beginning of period | 139,000,000 | 149,000,000 | 159,300,000 | |
Finite lived, amortization expense | -10,000,000 | -10,000,000 | -10,000,000 | |
Refranchising | -300,000 | |||
Finite lived, end of period | 129,000,000 | 139,000,000 | 149,000,000 | |
Recipes and Menus | Subject to Amortization | ||||
Finite and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Finite lived, beginning of period | 2,000,000 | 4,300,000 | 6,600,000 | |
Finite lived, amortization expense | -2,000,000 | -2,300,000 | -2,300,000 | |
Finite lived, end of period | 0 | 2,000,000 | 4,300,000 | |
Leaseholds | Subject to Amortization | ||||
Finite and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Finite lived, beginning of period | 0 | 0 | 2,100,000 | |
Finite lived, amortization expense | 0 | 0 | -200,000 | |
Refranchising | -1,900,000 | |||
Finite lived, end of period | $0 | $0 | $0 |
Other_Intangible_Assets_Schedu
Other Intangible Assets - Schedule of Finite-lived Intangible Assets (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Finite Lived Intangible Assets [Line Items] | ||
Amortization Expense 2015 | $10 | |
Amortization Expense 2016 | 10 | |
Amortization Expense 2017 | 10 | |
Amortization Expense 2018 | 10 | |
Amortization Expense 2019 | 10 | |
Weighted average life of intangible assets subject to amortization | 20 years | 20 years |
Gross | 216 | 216 |
Accumulated Amortization | -87 | -75 |
Net | 129 | 141 |
Franchising rights | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross | 200 | 200 |
Accumulated Amortization | -71 | -61 |
Net | 129 | 139 |
Recipes and Menus | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross | 15.7 | 15.7 |
Accumulated Amortization | -15.7 | -13.7 |
Net | 0 | 2 |
Leaseholds/other | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross | 0.3 | 0.3 |
Accumulated Amortization | -0.3 | -0.3 |
Net | $0 | $0 |
Debt_Schedule_of_Debt_Componen
Debt - Schedule of Debt Components (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Oct. 19, 2010 |
Debt Instrument [Line Items] | ||||
Discount | $0 | ($19,700,000) | ||
Total debt | 1,300,000,000 | 1,208,200,000 | ||
Less: current maturities | 0 | -4,720,000 | ||
Long-term debt, less current maturities | 1,300,000,000 | 1,203,517,000 | ||
Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | ||||
Debt Instrument [Line Items] | ||||
Senior Notes | 1,300,000,000 | 0 | ||
Senior note interest rate | 4.23% | 4.28% | ||
Senior Secured Credit Facility, due Oct 2017 | ||||
Debt Instrument [Line Items] | ||||
Senior Secured Credit Facility | 0 | 467,200,000 | ||
Secured credit facility interest rate | 3.75% | 4.25% | ||
Senior Notes, due Oct 2018, fixed rate 9.5% | ||||
Debt Instrument [Line Items] | ||||
Senior Notes | 0 | 760,800,000 | ||
Discount | ($29,600,000) | |||
Senior note interest rate | 9.50% | 9.50% |
Debt_Additional_Information_De
Debt - Additional Information (Details) (USD $) | 12 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Oct. 31, 2019 | Dec. 31, 2014 | Feb. 25, 2011 | Dec. 31, 2011 | Feb. 04, 2013 | Oct. 08, 2010 | Oct. 19, 2010 | |
quarter | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Repayments of Long-term Debt | $1,264,086,000 | $4,800,000 | $216,037,000 | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 4.50% | ||||||||||
LIBOR Rate Floor | 1.50% | ||||||||||
Base Rate Floor | 2.50% | ||||||||||
Federal Funds Rate Additional Margin | 0.50% | ||||||||||
One Month LIBOR Rate Floor | 1.50% | ||||||||||
One Month LIBOR Rate Additional Margin | 1.00% | ||||||||||
One Month LIBOR Rate Additional Margin Uplift | 3.50% | ||||||||||
Upfront Fee on Debt, Percent | 1.00% | ||||||||||
Debt modification costs | 0 | 1,296,000 | 0 | ||||||||
Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Face Amount | 1,300,000,000 | ||||||||||
Senior note interest rate | 4.23% | 4.28% | 4.23% | ||||||||
Debt Instrument, Restrictive Covenant, Number of Quarters Used in Leverage Ratio Calculation | 4 | ||||||||||
Ratio of Indebtedness to Net Capital | 5.25 | 5.25 | |||||||||
Deferred Finance Costs, Net | 23,500,000 | 24,300,000 | 23,500,000 | ||||||||
Amortization of Financing Costs | 800,000 | ||||||||||
Debt Service Coverage Ratio | 4.9 | ||||||||||
Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | Forecast | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Additional Interest on Fixed Rate | 5.00% | ||||||||||
Series 2014-1 Variable Funding Senior Notes Class A-1 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 100,000,000 | ||||||||||
Line of Credit Facility, Amount Outstanding | 0 | 0 | |||||||||
Debt Instrument, Interest Rate, Effective Percentage | 4.45% | 4.45% | |||||||||
Line of Credit Facility, Increase (Decrease) in Borrowing Capacity Through the Period | 9,600,000 | ||||||||||
Series 2014-1 Variable Funding Senior Notes Class A-1 | Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 1.00% | ||||||||||
Series 2014-1 Variable Funding Senior Notes Class A-1 | Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.50% | ||||||||||
Series 2014-1 Variable Funding Senior Notes Class A-1 | Forecast | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Additional Interest on Variable Rate | 5.00% | ||||||||||
Senior Secured Credit Facility, due Oct 2017 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 150,000,000 | 150,000,000 | 250,000,000 | ||||||||
Secured credit facility interest rate | 3.75% | 4.25% | 3.75% | ||||||||
Senior Secured Credit Facility | 0 | 467,200,000 | 0 | ||||||||
Mandatory Prepayment of Debt, Percent per Quarter | 0.25% | ||||||||||
Mandatory Prepayment of Debt, Percent per Annum | 1.00% | ||||||||||
Amended Senior Secured Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Repayments of Long-term Debt | 463,600,000 | ||||||||||
Payments of Debt Restructuring Costs | 12,300,000 | ||||||||||
Payments of Debt Restructuring Costs, Recorded as Additional Discount on Debt | 7,400,000 | ||||||||||
Payments of Debt Restructuring Costs, Recorded as Deferred Financing Costs | 800,000 | ||||||||||
Debt modification costs | 4,000,000 | ||||||||||
Deferred Finance Costs, Net | 800,000 | ||||||||||
Amended Senior Secured Revolving Credit Facility | Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 75,000,000 | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 4.50% | ||||||||||
LIBOR Rate Floor | 1.50% | ||||||||||
Base Rate Floor | 2.50% | ||||||||||
Amended Senior Secured Revolving Credit Facility | Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 50,000,000 | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 3.00% | ||||||||||
LIBOR Rate Floor | 1.25% | ||||||||||
Base Rate Floor | 2.25% | ||||||||||
Second Amended Senior Secured Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Ratio of Indebtedness to Net Capital | 5.75 | 5.75 | 4.75 | ||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 50.00% | 50.00% | 50.00% | ||||||||
Second Amended Senior Secured Revolving Credit Facility | Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Federal Funds Rate Additional Margin | 3.50% | ||||||||||
One Month LIBOR Rate Additional Margin | 4.50% | ||||||||||
Upfront Fee on Debt, Percent | 0.75% | ||||||||||
Ratio of Indebtedness to Net Capital | 5.75 | ||||||||||
Second Amended Senior Secured Revolving Credit Facility | Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.75% | ||||||||||
LIBOR Rate Floor | 1.00% | ||||||||||
Base Rate Floor | 2.00% | ||||||||||
Federal Funds Rate Additional Margin | 1.75% | ||||||||||
One Month LIBOR Rate Additional Margin | 2.75% | ||||||||||
Upfront Fee on Debt, Percent | 0.50% | ||||||||||
Ten Year United States Treasury Bill Rate | Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | Forecast | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.15% | ||||||||||
LIBOR | Series 2014-1 Variable Funding Senior Notes Class A-1 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | ||||||||||
Federal Funds Rate | Series 2014-1 Variable Funding Senior Notes Class A-1 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Basis Spread Component of Base Rate | 0.50% | ||||||||||
One Month LIBOR | Series 2014-1 Variable Funding Senior Notes Class A-1 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Basis Spread Component of Base Rate | 0.50% | ||||||||||
Base Rate | Series 2014-1 Variable Funding Senior Notes Class A-1 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.00% | ||||||||||
Commercial Paper Funding Rate | Series 2014-1 Variable Funding Senior Notes Class A-1 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | ||||||||||
First Trigger | Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Service Coverage Ratio, Event Trigger Threshold | 1.75 | ||||||||||
Debt Instrument, Restrictive Covenant, Restriction on Net Cash Flow | 50.00% | ||||||||||
First Trigger | Second Amended Senior Secured Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 25.00% | ||||||||||
First Trigger | Second Amended Senior Secured Revolving Credit Facility | Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Upfront Fee on Debt, Percent | 0.50% | ||||||||||
Ratio of Indebtedness to Net Capital | 5.75 | 5.75 | 5.75 | ||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 25.00% | 25.00% | |||||||||
First Trigger | Second Amended Senior Secured Revolving Credit Facility | Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Upfront Fee on Debt, Percent | 0.38% | ||||||||||
Ratio of Indebtedness to Net Capital | 5.25 | 5.25 | 5.25 | ||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 25.00% | 25.00% | |||||||||
Second Trigger | Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Service Coverage Ratio, Event Trigger Threshold | 1.5 | ||||||||||
Debt Instrument, Restrictive Covenant, Restriction on Net Cash Flow | 100.00% | ||||||||||
Second Trigger | Second Amended Senior Secured Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Ratio of Indebtedness to Net Capital | 5.25 | 5.25 | 5.25 | ||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 0.00% | 0.00% | 0.00% | ||||||||
Third Trigger | Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Service Coverage Ratio, Event Trigger Threshold | 1.3 | ||||||||||
Debt Instrument, Covenant Violation Description | Rapid Amortization | ||||||||||
Fourth Trigger | Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Service Coverage Ratio, Event Trigger Threshold | 1.2 | ||||||||||
Debt Instrument, Covenant Violation Description | Manager Termination | ||||||||||
Fifth Trigger | Series 2014-1, Class A-2 4.227% Fixed Rate Senior Secured Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Service Coverage Ratio, Event Trigger Threshold | 1.1 | ||||||||||
Debt Instrument, Covenant Violation Description | Default | ||||||||||
Term Loan | Senior Secured Credit Facility, due Oct 2017 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Face Amount | 900,000,000 | ||||||||||
Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 50.00% | ||||||||||
Revolving Credit Facility | Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Ratio of Indebtedness to Net Capital | 5.75 | ||||||||||
Revolving Credit Facility | Senior Secured Credit Facility, due Oct 2017 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Face Amount | 50,000,000 | ||||||||||
Revolving Credit Facility | First Trigger | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 75.00% | ||||||||||
Revolving Credit Facility | First Trigger | Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Ratio of Indebtedness to Net Capital | 5.75 | ||||||||||
Revolving Credit Facility | First Trigger | Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Ratio of Indebtedness to Net Capital | 5.25 | ||||||||||
Revolving Credit Facility | Second Trigger | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 100.00% | ||||||||||
Revolving Credit Facility | Second Trigger | Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Ratio of Indebtedness to Net Capital | 5.25 | ||||||||||
Letter of Credit | Senior Secured Credit Facility, due Oct 2017 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $50,000,000 |
Debt_95_Senior_Notes_due_2018_
Debt - 9.5% Senior Notes due 2018 (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 30, 2014 | Sep. 30, 2014 | Oct. 19, 2010 | Feb. 25, 2011 | |
Debt Instrument [Line Items] | |||||||
Maximum Amount of Aggregate Principal Redeemed With Net Proceeds Raised in One or More Equity Offerings | 35.00% | ||||||
Comulsory Purchase Price Under Change of Control | 101.00% | ||||||
Compulsory Purchase Price Under Sale of Assets Under Certain Circumstances | 100.00% | ||||||
Minimum Aggregate Principal Amount Required for Trustees or Other Holders to Declare Principal and Accrued Interest Immediately Due | 25.00% | ||||||
Gain (Loss) on Extinguishment of Debt, Deferred Financing Costs | $11,900,000 | ||||||
Unamortized Discount | 0 | 19,700,000 | |||||
Gain (Loss) on Extinguishment of Debt, Unamortized Premium (Discount) | 16,900,000 | ||||||
Repayments of Long-term Debt | 1,264,086,000 | 4,800,000 | 216,037,000 | ||||
Loss on extinguishment of debt | 64,859,000 | 58,000 | 5,554,000 | ||||
Gain (Loss) on Extinguishment of Debt, Make-Whole Premium | 36,100,000 | ||||||
Other Assets | |||||||
Debt Instrument [Line Items] | |||||||
Deferred Finance Costs, Net | 14,000,000 | ||||||
Senior Notes, due Oct 2018, fixed rate 9.5% | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Face Amount | 825,000,000 | ||||||
Senior note interest rate | 9.50% | 9.50% | |||||
Percent of Consolidated Net Income Used to Calculated Restricted Payments, Annual Mininum | 50.00% | ||||||
Deferred Finance Costs, Net | 28,200,000 | ||||||
Amortization of Financing Costs | 2,200,000 | 2,700,000 | 2,600,000 | ||||
Gain (Loss) on Extinguishment of Debt, Deferred Financing Costs | 2,300,000 | ||||||
Unamortized Discount | 29,600,000 | ||||||
Amortization of Debt Discount (Premium) | 2,800,000 | 3,500,000 | 3,400,000 | ||||
Gain (Loss) on Extinguishment of Debt, Unamortized Premium (Discount) | 2,700,000 | ||||||
Repayments of Long-term Debt | 761,000,000 | ||||||
Gain (Loss) on Extinguishment of Debt, Make-Whole Premium | 36,100,000 | ||||||
Amended Senior Secured Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Deferred Finance Costs, Net | 800,000 | ||||||
Unamortized Discount | 7,400,000 | ||||||
Repayments of Long-term Debt | 463,600,000 | ||||||
Loss on extinguishment of debt | 0 | ||||||
Debt Redemption, After December 2013 and Before October 30, 2014 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Redemption Price, Percentage | 100.00% | ||||||
Debt Redemption Premium | 36,100,000 | ||||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Restrictive Covenant, General Restricted Payment Allowance | 35,000,000 | ||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 50.00% | ||||||
Revolving Credit Facility | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Ratio of Indebtedness to Net Capital | 5.75 | ||||||
Revolving Credit Facility | First Trigger | |||||||
Debt Instrument [Line Items] | |||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 75.00% | ||||||
Revolving Credit Facility | First Trigger | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Ratio of Indebtedness to Net Capital | 5.75 | ||||||
Revolving Credit Facility | First Trigger | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Ratio of Indebtedness to Net Capital | 5.25 | ||||||
Revolving Credit Facility | Second Trigger | |||||||
Debt Instrument [Line Items] | |||||||
Percent of Excess Cash Flow Required For Mandatory Prepayment, Annual Mininum | 100.00% | ||||||
Revolving Credit Facility | Second Trigger | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Ratio of Indebtedness to Net Capital | 5.25 |
Financing_Obligations_Details
Financing Obligations (Details) (USD $) | 1 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Jun. 30, 2008 | Dec. 31, 2014 | Dec. 31, 2017 | Dec. 31, 2015 | 19-May-08 |
term_extension_option | real_property | monthly_payment | monthly_payment | real_property | |
Minimum Lease Payments, Sale Leaseback Transactions, Fiscal Year Maturity [Abstract] | |||||
2015 | $5.40 | ||||
2016 | 5 | ||||
2017 | 4.6 | ||||
2018 | 5.2 | ||||
2019 | 5.5 | ||||
Thereafter | 75.8 | ||||
Total minimum lease payments | 101.5 | ||||
Less: interest | -58.8 | ||||
Total financing obligations | 42.7 | ||||
Less: current portion(2) | -0.1 | ||||
Long-term financing obligations | 42.6 | ||||
Sale Leaseback Transaction Agreement for Properties | |||||
Sale Leaseback Transaction [Line Items] | |||||
Parcels of real property under sale leaseback transaction | 181 | ||||
Master Lease Agreement | |||||
Sale Leaseback Transaction [Line Items] | |||||
Parcels of real property under sale leaseback transaction | 181 | ||||
Gross proceeds of sale leaseback transaction | 337.2 | ||||
Sale leaseback initial term | 20 years | ||||
Number of options to extend initial leaseback term | 4 | ||||
Extension period for options to extend sale leaseback initial term (in years) | 5 years | ||||
Properties assigned to franchisee or released from lessor | 152 | ||||
Reduction in property and equipment and financing obligations as a result of sales transactions | $270.60 | ||||
Forecast | |||||
Minimum Lease Payments, Sale Leaseback Transactions, Fiscal Year Maturity [Abstract] | |||||
Number of Monthly Obligation Payments in Fiscal Year | 11 | 13 |
Leases_Lease_Receivables_Detai
Leases Lease Receivables (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Direct financing leases receivable | |||
Lease [Line Items] | |||
Total minimum rents receivable | $126.70 | $144.80 | |
Less unearned income | -45.1 | -56.2 | |
Net investment in direct financing lease receivables | 81.6 | 88.6 | |
Less current portion | -8 | -7 | |
Long-term direct financing lease receivable | 73.6 | 81.6 | |
Contingent rental income | 14.1 | 12.7 | 12.5 |
Net investment equipment lease | |||
Lease [Line Items] | |||
Less current portion | -7.4 | -7.1 | |
Long-term direct financing lease receivable | 99.9 | 108 | |
Total minimum leases receivable | 165.4 | 184.2 | |
Less unearned income | -58.1 | -69.1 | |
Net investment in equipment leases receivables | $107.30 | $115.10 |
Leases_Future_Minimum_Lease_Pa
Leases Future Minimum Lease Payments (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2017 | Dec. 31, 2015 | Dec. 31, 2014 |
monthly_payment | monthly_payment | ||
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||
2015 | $26.20 | ||
2016 | 24 | ||
2017 | 21.4 | ||
2018 | 20.6 | ||
2019 | 17.2 | ||
Thereafter | 58.7 | ||
Total minimum lease payments | 168.1 | ||
Less: interest | -55.3 | ||
Capital lease obligations | 112.8 | ||
Less: current portion (2) | -14.7 | ||
Long-term capital lease obligations | 98.1 | ||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||
2015 | 83.5 | ||
2016 | 75.9 | ||
2017 | 68.4 | ||
2018 | 72.6 | ||
2019 | 68.4 | ||
Thereafter | 328.5 | ||
Total minimum lease payments | $697.30 | ||
Forecast | |||
Lease [Line Items] | |||
Number of Monthly Obligation Payments in Fiscal Year | 11 | 13 |
Leases_Future_Minimum_Lease_Re
Leases Future Minimum Lease Rents (Details) (USD $) | 12 Months Ended | ||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2017 | Dec. 31, 2015 |
monthly_payment | monthly_payment | ||||
Future Minimum Lease Rents Due [Abstract] | |||||
Asset Cost of Leased Property | $90.10 | $90.10 | |||
Carrying Amount on Leased Property | 64.5 | 66.1 | |||
Contingent Rent Expense on Leases | 2.8 | 2.8 | 2.7 | ||
Minimum Rent Expense on Leases | 75.9 | 75.4 | 78 | ||
2015 | 18.3 | ||||
2016 | 17.8 | ||||
2017 | 17.9 | ||||
2018 | 17.5 | ||||
2019 | 16.3 | ||||
Thereafter | 38.9 | ||||
Total minimum rents receivable | 126.7 | ||||
2015 | 101.5 | ||||
2016 | 99.7 | ||||
2017 | 99.6 | ||||
2018 | 98.9 | ||||
2019 | 97.1 | ||||
Thereafter | 555.8 | ||||
Total minimum rents receivable | $1,052.60 | ||||
Forecast | |||||
Lease [Line Items] | |||||
Number of Monthly Obligation Payments in Fiscal Year | 11 | 13 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Loss Contingencies [Line Items] | ||
Outstanding purchase commitments | $108.40 | |
Applebee's | Property Lease Guarantee | ||
Loss Contingencies [Line Items] | ||
Outstanding lease guarantees | $378.10 | $417.80 |
Preferred_Stock_and_Stockholde2
Preferred Stock and Stockholders' Equity (Details) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | ||||||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 29, 2012 | Nov. 29, 2007 | Jan. 31, 2011 | Feb. 24, 2015 | Feb. 26, 2013 | Oct. 27, 2014 | |
vote | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Conversion of Series B preferred stock | $0 | ||||||||||||||||
Stock Repurchased During Period, Shares | 412,022 | ||||||||||||||||
Repurchase of DineEquity common stock | -32,006,000 | -29,698,000 | 0 | ||||||||||||||
Reissuance of treasury stock | 8,207,000 | 9,080,000 | 7,453,000 | ||||||||||||||
Dividends declared per common share (USD per share) | $0.88 | $0.75 | $0.75 | $0.75 | $0.75 | $0.75 | $0.75 | $0.75 | $3.13 | $3 | $0 | ||||||
Series B Convertible Preferred Stock | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Preferred stock, shares issued | 35,000 | ||||||||||||||||
Payments for Repurchase of Preferred Stock and Preference Stock | 35,000,000 | ||||||||||||||||
Payments of Stock Issuance Costs | 800,000 | ||||||||||||||||
Convertible Stock Initial Stated Value | $1,000 | ||||||||||||||||
Preferred Stock Accretion Rate per Annum | 6.00% | ||||||||||||||||
Number of Voting Rights upon Conversion | 1 | ||||||||||||||||
Preferred Stock, Accretion Value for Conversion | 1,000 | ||||||||||||||||
Convertible Preferred Stock, Shares Issued per Aggregate Accretion Value Unit | 14.44878 | 14.44878 | |||||||||||||||
Conversion of Series B preferred stock, shares | 34,900 | 100 | |||||||||||||||
Conversion of Series B preferred stock | 47,000,000 | 120,000 | |||||||||||||||
Common Stock | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 679,168 | 1,737 | |||||||||||||||
Treasury Stock | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Stock Repurchased During Period, Shares | 387,591 | 412,022 | |||||||||||||||
Reissuance of treasury stock, shares | -359,528 | -318,644 | -433,732 | ||||||||||||||
Reissuance of treasury stock | 13,000,000 | 11,692,000 | 14,089,000 | ||||||||||||||
Subsequent Event | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Dividends declared per common share (USD per share) | $0.88 | ||||||||||||||||
2013 Authorization | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Authorized amount under stock repurchase program | 100,000,000 | ||||||||||||||||
Stock Repurchased During Period, Shares | 367,256 | ||||||||||||||||
Repurchase of DineEquity common stock | -30,000,000 | ||||||||||||||||
2014 Authorization | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Authorized amount under stock repurchase program | 100,000,000 | ||||||||||||||||
Stock Repurchased During Period, Shares | 20,335 | ||||||||||||||||
Repurchase of DineEquity common stock | -2,000,000 | 0 | |||||||||||||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $98,000,000 | $98,000,000 |
Preferred_Stock_and_Stockholde3
Preferred Stock and Stockholders' Equity - Schedule of Dividends Declared (Details) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | ||||||||||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 24, 2015 | Jan. 16, 2015 |
Class of Stock [Line Items] | |||||||||||||
Dividends declared per common share (USD per share) | $0.88 | $0.75 | $0.75 | $0.75 | $0.75 | $0.75 | $0.75 | $0.75 | $3.13 | $3 | $0 | ||
Payments of Dividends | $0 | $14.20 | $14.30 | $14.30 | $14.30 | $14.30 | $14.40 | $14.60 | $42.80 | $57.60 | |||
Subsequent Event | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Dividends declared per common share (USD per share) | $0.88 | ||||||||||||
Payments of Dividends | $16.60 |
Closure_and_Impairment_Charges2
Closure and Impairment Charges (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Impairment and Closure Charges [Line Items] | |||
Closure charges | $2,100,000 | $1,000,000 | $2,300,000 |
Long-lived tangible asset impairment | 1,600,000 | 800,000 | 1,900,000 |
Total Impairment and closure charges | $3,721,000 | $1,812,000 | $4,218,000 |
Applebee's | |||
Impairment and Closure Charges [Line Items] | |||
Company operated restaurants taken back to be refranchised | 3 | ||
IHOP | |||
Impairment and Closure Charges [Line Items] | |||
Company operated restaurants taken back and closed | 1 | ||
Company operated restaurants taken back to be refranchised | 2 | 5 |
StockBased_Incentive_Plans_Nar
Stock-Based Incentive Plans (Narrative) (Details) | 12 Months Ended | |||
Dec. 31, 1999 | Dec. 31, 2014 | 17-May-11 | Dec. 31, 2008 | |
DineEquity, Inc. 2011 Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of Outstanding Options Authorized | 1,500,000 | |||
IHOP Corp. 2001 Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of Outstanding Options Authorized | 4,200,000 | |||
Stock Option Plan for Non-Employee Directors | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares Approved for Issuance | 400,000 | |||
Officers, Directors, and Employees | Employee Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Option Expiration Period | 10 years | |||
Officers, Directors, and Employees | Restricted Stock and Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years |
StockBased_Incentive_Plans_Sto
Stock-Based Incentive Plans Stock-Based Compensation Expense (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compenation, equity classified awards | $9,400,000 | $9,400,000 | $11,400,000 |
Stock-based compenation, liability classified awards | 2,400,000 | 900,000 | 4,800,000 |
Pre-tax compensation expense | 11,800,000 | 10,300,000 | 16,300,000 |
Book tax benefit | -4,500,000 | -3,900,000 | -6,200,000 |
Total stock-based compensation expense, net of tax | 7,300,000 | 6,400,000 | 10,100,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Outstanding, Beginning | 775,059 | 958,246 | 1,318,640 |
Granted | 120,932 | 81,328 | 147,674 |
Excercised | -256,910 | -225,272 | -455,217 |
Forfeited | -20,966 | -39,243 | -39,381 |
Expired | -13,470 | ||
Outstanding, Ending | 618,115 | 775,059 | 958,246 |
Vested and Expected to Vest | 600,708 | ||
Exercisable | 433,793 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |||
Weighted Avg Share Prince, Beginning | $42.09 | $39.67 | $32.06 |
Weighted Avg Share Price, Granted | $81.53 | $72.28 | $51.63 |
Weighted Avg Share Price, Exercised | $31.95 | $40.31 | $20.91 |
Weighted Avg Share Price, Forfeited | $69.18 | $55.78 | $46.97 |
Weighted Avg Share Price, Expired | $38.64 | ||
Weighted Avg Share Prince, Ending | $53.10 | $42.09 | $39.67 |
Vested and expected to vest, weighted avg share price | $52.36 | ||
Exercisable, weighted avg share price | $44.09 | ||
Options, Outstanding, Weighted Average Remaining Contractual Term | 6 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Weighted Average Remaining Contractual Term | 5 years 10 months 24 days | ||
Excercisable Weighted Average Remaining Contractual Term | 4 years 9 months 18 days | ||
Options, Outstanding, Intrinsic Value | 31,200,000 | ||
Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value | 30,800,000 | ||
Options, Exercisable, Intrinsic Value | 25,800,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Total Intrinsic Value | 13,200,000 | 7,500,000 | 15,000,000 |
Employee Service Share-based Compensation, Cash Received from Exercise of Stock Options | 8,200,000 | 9,100,000 | 9,300,000 |
Tax Benefit from Stock Options Exercised | 4,300,000 | 3,700,000 | 6,200,000 |
Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | 3,200,000 | ||
Unrecognized Compensation Cost Related to Options, Expected Recognition Period | 1 year 4 months 13 days | ||
Restricted Stock Units (RSUs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $9,100,000 | ||
Unrecognized Compensation Cost Related to Options, Expected Recognition Period | 1 year 5 months 26 days |
StockBased_Incentive_Plans_Opt
Stock-Based Incentive Plans Options Value Assumptions (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Risk free interest rate | 1.60% | 0.80% | 0.90% |
Weighted average historical volatility | 51.10% | 83.40% | 84.50% |
Dividend yield | 3.68% | 4.15% | 0.00% |
Expected years until exercise | 4 years 7 months 6 days | 4 years 7 months 6 days | 4 years 8 months 19 days |
Forfeitures | 11.00% | 11.00% | 11.00% |
Weighted average fair value of options granted | $26.87 | $36 | $33.53 |
StockBased_Incentive_Plans_Dis
Stock-Based Incentive Plans Disclosure of Restricted Stock Units (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Pre-tax compensation expense | $11,800,000 | $10,300,000 | $16,300,000 |
Accrued employee compensation and benefits | 25,722,000 | 24,956,000 | |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Multiplier for target award based on total shareholder return on common stock | 0.00% | ||
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Multiplier for target award based on total shareholder return on common stock | 200.00% | ||
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward] | |||
Beginning of period | 266,252 | 346,563 | 486,533 |
Granted | 102,618 | 97,812 | 137,852 |
Released | -94,798 | -117,075 | -179,465 |
Forfeited | -40,254 | -61,048 | -98,357 |
End of period | 233,818 | 266,252 | 346,563 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Beginning of period, weighted average grant date fair value | $58.87 | $44.74 | $31.08 |
Granted, weighted average grant date fair value | $82.18 | $73.11 | $52.23 |
Released, weighted average grant date fair value | $53.03 | $30.96 | $13.83 |
Forfeited, weighted average grant date fair value | $67.68 | $55.37 | $44.40 |
End of period, weighted average grant date fair value | $70.14 | $58.87 | $44.74 |
Restricted Stock Units (RSUs) | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward] | |||
Beginning of period | 47,230 | 33,242 | 18,000 |
Granted | 13,879 | 15,804 | 19,152 |
Conversion of cash-settled restricted stock units | 37,184 | ||
Released | -19,487 | -39,000 | -3,910 |
End of period | 41,622 | 47,230 | 33,242 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Beginning of period, weighted average grant date fair value | $64.57 | $41.19 | $29.32 |
Granted, weighted average grant date fair value | $81.65 | $72.04 | $52.23 |
Conversion of cash-settled restricted stock units, weighted average | $72.28 | ||
Released, weighted average grant date fair value | $70.82 | $54.66 | $40.58 |
End of period, weighted average grant date fair value | $66.92 | $64.57 | $41.19 |
Cash Settled Restricted Stock Units Classified as Liabilities | Board of Directors | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward] | |||
Beginning of period | 37,184 | 41,957 | |
Granted | 0 | ||
Released | -37,184 | -4,773 | |
End of period | 0 | 37,184 | 41,957 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Beginning of period, weighted average grant date fair value | $66.13 | $64.26 | |
Granted, weighted average grant date fair value | $0 | ||
Released, weighted average grant date fair value | $72.28 | $49.66 | |
End of period, weighted average grant date fair value | $66.13 | $64.26 | |
Pre-tax compensation expense | 300,000 | 1,000,000 | |
LTIP | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Pre-tax compensation expense | 2,400,000 | 600,000 | 3,800,000 |
Accrued employee compensation and benefits | $4,000,000 | $2,800,000 | |
Award vesting period | 3 years |
Employee_Benefit_Plans_Details
Employee Benefit Plans (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Defined Contribution Pension Plan [Line Items] | |||
Contributions made to 401(k) | $2.30 | $2.30 | $2.20 |
First Tier of Deferral | |||
Defined Contribution Pension Plan [Line Items] | |||
Percent of gross pay | 100.00% | ||
Percent of eligible deferral | 4.00% | ||
Second Tier of Deferral | |||
Defined Contribution Pension Plan [Line Items] | |||
Percent of gross pay | 50.00% | ||
Percent of eligible deferral | 2.00% |
Income_Taxes_Provision_benefit
Income Taxes Provision (benefit) for income taxes (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | |||
Current Federal Income Tax Expense (Benefit) | $33,194 | $48,500 | $77,400 |
Current State and Local Tax Expense (Benefit) | 3,614 | 2,080 | 1,949 |
Current Foreign Tax Expense (Benefit) | 2,722 | 2,400 | 1,800 |
Current Income Tax Expense | 39,530 | 52,980 | 81,149 |
Deferred Federal Income Tax Expense (Benefit) | -22,126 | -13,500 | -12,200 |
Deferred State Income Tax Expense (Benefit) | -2,261 | -900 | -1,700 |
Deferred Income Tax Expense (Benefit) | -24,387 | -14,400 | -13,900 |
Income Tax Expense (Benefit) | $15,143 | $38,580 | $67,249 |
Income_Taxes_Income_tax_rate_r
Income Taxes Income tax rate reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Tax Disclosure [Abstract] | |||
Statutory federal income tax rate | 35.00% | 35.00% | 35.00% |
State and other taxes, net of federal tax benefit | 2.40% | 2.90% | 2.80% |
Change in unrecognized tax benefits | 2.40% | 1.40% | -0.20% |
Change in valuation allowance | 0.00% | -2.70% | 0.70% |
Domestic production activity deduction | -6.00% | 0.00% | 0.00% |
Research and experimentation tax credit | -3.40% | 0.00% | 0.00% |
State adjustments including audits and settlements | -1.10% | -1.10% | 0.20% |
Compensation related tax credits, net of deduction offsets | -0.80% | -0.60% | -0.90% |
Changes in tax rates and state tax laws | 0.00% | 0.00% | -3.20% |
Other | 0.80% | 0.00% | 0.10% |
Effective tax rate | 29.30% | 34.90% | 34.50% |
Income_Taxes_Net_deferred_tax_
Income Taxes Net deferred tax assets (liabilities) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure [Abstract] | ||
Differences in capitalization and depreciation and amortization of reacquired franchises and equipment | $4,829 | $4,800 |
Differences in acquisition financing costs | 1,834 | 1,800 |
Employee compensation | 14,378 | 15,000 |
Deferred gain on sale of assets | 6,453 | 6,300 |
Book/tax difference in revenue recognition | 39,613 | 29,800 |
Other | 35,865 | 35,000 |
Deferred tax assets | 102,972 | 92,700 |
Valuation allowance | -1,143 | -1,100 |
Total deferred tax assets after valuation allowance | 101,829 | 91,600 |
Differences between financial and tax accounting in the recognition of franchise and equipment sales | -47,973 | -51,200 |
Differences in capitalization and depreciation (1) | -294,600 | -301,100 |
Differences in acquisition financing costs | 0 | -7,100 |
Book/tax difference in revenue recognition | -15,629 | -19,500 |
Differences between book and tax basis of property and equipment | -11,361 | -10,100 |
Other | -20,517 | -20,325 |
Deferred tax liabilities | -390,080 | -409,325 |
Net deferred tax liabilities | -288,251 | -317,725 |
Net deferred tax assetbcurrent | 31,242 | 24,200 |
Valuation allowancebcurrent | -382 | -347 |
Net deferred tax assetbcurrent | 30,860 | 23,853 |
Deferred tax liabilitybnon-current | -318,352 | -340,800 |
Net deferred tax liabilitybnon-current | -759 | -778 |
Net deferred tax liabilitybnon-current | ($319,111) | ($341,578) |
Income_Taxes_Reconciliation_of
Income Taxes Reconciliation of unrecognized tax benefit (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized Tax Benefits, Beginning of Period | $2.70 | $6.70 | $8.20 |
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions | 1.2 | 0.8 | 0.8 |
Unrecognized Tax Benefits, Increase Resulting from Current Period Tax Positions | 0.1 | 0 | 0.2 |
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities of Lapse of Applicate Statute of Limitations | -0.6 | -4.8 | -2.5 |
Unrecognized Tax Benefits, End of Period | $3.40 | $2.70 | $6.70 |
Income_Taxes_Income_Taxes_Narr
Income Taxes Income Taxes (Narrative) (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Tax Disclosure [Abstract] | ||||
Decrease on qualified production deductions, current period, percent | 2.30% | |||
Decrease on qualified production deductions, prior period, percent | 3.70% | |||
Decrease on research tax credits, current period, percent | 0.50% | |||
Decrease on research tax credits, prior period, percent | 2.90% | |||
Unrecognized Tax Benefits | $3,400,000 | $2,700,000 | $6,700,000 | $8,200,000 |
Unrecognized tax benefit changes in next 12 months | 700,000 | |||
Unrecognized Tax Benefits, Interest on Income Taxes Accrued | 3,900,000 | 2,900,000 | ||
Unrecognized Tax Benefits, Income Tax Penalties Accrued | 100,000 | 100,000 | ||
Decrease in Accrued Interest Resulting From Release of Liabilities for Unrecognized Tax Benefits Related to Gift Card Income Deferral as a Result of New IRS Guidance, Net | 1,000,000 | |||
Deferred Tax Assets, Valuation Allowance | $1,143,000 | $1,100,000 |
Net_Income_Per_Share_Details
Net Income Per Share (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Earnings Per Share [Abstract] | |||||||||||
Net income | ($22,425) | $18,887 | $19,167 | $20,824 | $18,131 | $18,730 | $16,937 | $18,239 | $36,453 | $72,037 | $127,674 |
Less: Accretion of Series B preferred stock | 0 | 0 | -2,498 | ||||||||
Less: Net income allocated to unvested participating restricted stock | -521 | -1,200 | -2,718 | ||||||||
Net income available to common stockholders - basic | 35,932 | 70,837 | 122,458 | ||||||||
Effect of unvested participating restricted stock | 0 | 4 | 127 | ||||||||
Effect of dilutive securities, convertible Series B preferred stock | 0 | 0 | 2,498 | ||||||||
Numerator - net income available to common shareholders - diluted | $35,932 | $70,841 | $125,083 | ||||||||
Weighted average outstanding shares of common stock - basic | 18,753 | 18,871 | 17,992 | ||||||||
Stock options | 203 | 270 | 264 | ||||||||
Convertible Series B preferred stock | 0 | 0 | 621 | ||||||||
Weighted average outstanding shares of common stock - diluted | 18,956 | 19,141 | 18,877 | ||||||||
Basic (USD per share) | ($1.18) | $0.99 | $1 | $1.09 | $0.95 | $0.98 | $0.88 | $0.95 | $1.92 | $3.75 | $6.81 |
Diluted (USD per share) | $0.99 | $1 | $1.08 | $0.94 | $0.97 | $0.87 | $0.93 | $1.90 | $3.70 | $6.63 |
Segment_Reporting_Details
Segment Reporting (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $164,413 | $162,853 | $160,521 | $167,201 | $157,901 | $161,283 | $158,114 | $163,169 | $654,988 | $640,467 | $849,928 |
Income (loss) before income taxes | 51,596 | 110,617 | 194,923 | ||||||||
Interest expense | 111,700 | 116,400 | 131,700 | ||||||||
Depreciation and amortization | 34,745 | 35,355 | 39,538 | ||||||||
Closure and impairment charges | 3,721 | 1,812 | 4,218 | ||||||||
Capital expenditures | 5,900 | 7,000 | 17,000 | ||||||||
Goodwill (franchise segment) | 697,470 | 697,470 | 697,470 | 697,470 | 697,470 | ||||||
Total assets | 2,448,108 | 2,404,642 | 2,448,108 | 2,404,642 | 2,415,400 | ||||||
Franchise operations | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 456,100 | 439,200 | 421,400 | ||||||||
Income (loss) before income taxes | 334,300 | 329,500 | 311,500 | ||||||||
Depreciation and amortization | 10,400 | 10,800 | 9,800 | ||||||||
Total assets | 1,635,000 | 1,606,400 | 1,635,000 | 1,606,400 | 1,523,000 | ||||||
Company restaurants | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 62,500 | 63,400 | 291,100 | ||||||||
Income (loss) before income taxes | -200 | -200 | 41,800 | ||||||||
Interest expense | 400 | 400 | 400 | ||||||||
Depreciation and amortization | 2,100 | 2,200 | 6,900 | ||||||||
Closure and impairment charges | 3,700 | 1,800 | 4,200 | ||||||||
Capital expenditures | 1,500 | 1,300 | 9,500 | ||||||||
Total assets | 177,700 | 191,600 | 177,700 | 191,600 | 186,200 | ||||||
Rental operations | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 122,900 | 124,800 | 122,900 | ||||||||
Income (loss) before income taxes | 28,300 | 27,500 | 25,700 | ||||||||
Interest expense | 14,700 | 15,700 | 17,000 | ||||||||
Depreciation and amortization | 13,200 | 13,400 | 13,600 | ||||||||
Total assets | 344,300 | 364,000 | 344,300 | 364,000 | 397,300 | ||||||
Financing operations | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 13,500 | 13,100 | 14,500 | ||||||||
Income (loss) before income taxes | 12,700 | 12,900 | 12,900 | ||||||||
Total assets | 109,900 | 117,100 | 109,900 | 117,100 | 125,400 | ||||||
Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Income (loss) before income taxes | -323,500 | -259,100 | -197,000 | ||||||||
Interest expense | 96,600 | 100,300 | 114,300 | ||||||||
Depreciation and amortization | 9,000 | 9,000 | 9,200 | ||||||||
Capital expenditures | 4,400 | 5,700 | 7,500 | ||||||||
Total assets | $181,200 | $125,500 | $181,200 | $125,500 | $183,500 |
Selected_Quarterly_Financial_D2
Selected Quarterly Financial Data (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $164,413 | $162,853 | $160,521 | $167,201 | $157,901 | $161,283 | $158,114 | $163,169 | $654,988 | $640,467 | $849,928 |
Operating Margin | 91,941 | 91,629 | 94,473 | 97,072 | 91,199 | 93,043 | 91,026 | 94,424 | 375,115 | 369,692 | 391,944 |
Net income | ($22,425) | $18,887 | $19,167 | $20,824 | $18,131 | $18,730 | $16,937 | $18,239 | $36,453 | $72,037 | $127,674 |
Basic (USD per share) | ($1.18) | $0.99 | $1 | $1.09 | $0.95 | $0.98 | $0.88 | $0.95 | $1.92 | $3.75 | $6.81 |
Diluted (USD per share) | $0.99 | $1 | $1.08 | $0.94 | $0.97 | $0.87 | $0.93 | $1.90 | $3.70 | $6.63 |