Cover Page
Cover Page - shares | 9 Months Ended | |
Jul. 07, 2019 | Aug. 02, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jul. 7, 2019 | |
Entity File Number | 1-9390 | |
Entity Registrant Name | JACK IN THE BOX INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 95-2698708 | |
Entity Address, Address Line One | 9330 Balboa Avenue | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92123 | |
City Area Code | 858 | |
Local Phone Number | 571-2121 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | JACK | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 25,824,470 | |
Entity Central Index Key | 0000807882 | |
Current Fiscal Year End Date | --09-29 | |
Document Transition Report | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jul. 07, 2019 | Sep. 30, 2018 |
Current assets: | ||
Cash | $ 12,447 | $ 2,705 |
Accounts and other receivables, net | 57,647 | 57,422 |
Inventories | 1,937 | 1,858 |
Prepaid expenses | 17,484 | 14,443 |
Current assets held for sale | 13,236 | 13,947 |
Other current assets | 3,246 | 4,598 |
Total current assets | 105,997 | 94,973 |
Property, Plant and Equipment [Abstract] | ||
Property and equipment, at cost | 1,178,894 | 1,190,031 |
Less accumulated depreciation and amortization | (788,956) | (770,362) |
Property and equipment, net | 389,938 | 419,669 |
Other Assets [Abstract] | ||
Intangible assets, net | 451 | 600 |
Goodwill | 46,747 | 46,749 |
Deferred tax assets | 72,903 | 62,140 |
Other assets, net | 215,234 | 199,266 |
Total other assets | 335,335 | 308,755 |
Total assets | 831,270 | 823,397 |
Current liabilities: | ||
Current maturities of long-term debt | 42,895 | 31,828 |
Accounts payable | 51,131 | 44,970 |
Accrued liabilities | 124,823 | 106,922 |
Total current liabilities | 218,849 | 183,720 |
Long-term liabilities: | ||
Long-term debt, net of current maturities | 971,763 | 1,037,927 |
Other long-term liabilities | 221,219 | 193,449 |
Total long-term liabilities | 1,192,982 | 1,231,376 |
Stockholders’ (deficit) equity: | ||
Preferred stock $0.01 par value, 15,000,000 shares authorized, none issued | 0 | 0 |
Common stock $0.01 par value, 175,000,000 shares authorized, 82,146,917 and 82,061,661 issued, respectively | 821 | 821 |
Capital in excess of par value | 478,256 | 470,826 |
Retained earnings | 1,565,287 | 1,561,353 |
Accumulated other comprehensive loss | (94,486) | (94,260) |
Treasury stock, at cost, 56,325,632 shares | (2,530,439) | (2,530,439) |
Total stockholders’ deficit | (580,561) | (591,699) |
Total liabilities and stockholders' equity | $ 831,270 | $ 823,397 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jul. 07, 2019 | Sep. 30, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 15,000,000 | 15,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 82,146,917 | 82,061,661 |
Treasury stock at cost, shares | 56,325,632 | 56,325,632 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Earnings - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | ||
Revenues | $ 222,359 | $ 187,983 | $ 728,872 | $ 692,218 | |
Operating costs and expenses, net: | |||||
Food and packaging | 23,058 | 24,946 | 74,350 | 106,448 | |
Payroll and employee benefits | 23,121 | 24,875 | 76,163 | 106,911 | |
Occupancy and other | 11,052 | 13,715 | 38,165 | 59,608 | |
Total company restaurant costs | 57,231 | 63,536 | 188,678 | 272,967 | |
Selling, general and administrative expenses | 24,389 | 19,671 | 66,057 | 80,326 | |
Depreciation and amortization | 12,786 | 13,194 | 42,645 | 46,306 | |
Impairment and other charges, net | (3,256) | 3,265 | 5,567 | 10,449 | |
Gains on the sale of company-operated restaurants | 0 | (28,676) | (219) | (43,088) | |
Total operating costs and expenses | 174,098 | 111,220 | 575,164 | 494,841 | |
Earnings from operations | 48,261 | 76,763 | 153,708 | 197,377 | |
Other pension and post-retirement expenses, net | 342 | 423 | 1,141 | 1,410 | |
Interest expense, net | 36,494 | 10,873 | 67,144 | 34,066 | |
Earnings from continuing operations and before income taxes | 11,425 | 65,467 | 85,423 | 161,901 | |
Income taxes | [1] | (2,048) | 17,334 | 15,699 | 75,898 |
Earnings from continuing operations | 13,473 | 48,133 | 69,724 | 86,003 | |
(Losses) earnings from discontinued operations, net of income taxes | (284) | (2,826) | 2,652 | 19,099 | |
Net earnings | $ 13,189 | $ 45,307 | $ 72,376 | $ 105,102 | |
Net earnings per share - basic: | |||||
Earnings from continuing operations | $ 0.52 | $ 1.72 | $ 2.69 | $ 2.97 | |
(Losses) earnings from discontinued operations | (0.01) | (0.10) | 0.10 | 0.66 | |
Net earnings per share | [2] | 0.51 | 1.62 | 2.79 | 3.63 |
Net earnings per share - diluted: | |||||
Earnings from continuing operations | 0.51 | 1.70 | 2.67 | 2.94 | |
(Losses) earnings from discontinued operations | (0.01) | (0.10) | 0.10 | 0.65 | |
Net earnings per share | [2] | 0.50 | 1.60 | 2.77 | 3.59 |
Cash dividends declared per common share | $ 0.40 | $ 0.40 | $ 1.20 | $ 1.20 | |
Restaurant Sales [Member] | |||||
Revenues | $ 78,434 | $ 87,574 | $ 257,948 | $ 371,149 | |
Franchise [Member] | |||||
Franchise rental revenues | 63,359 | 61,622 | 208,895 | 196,682 | |
Operating costs and expenses, net: | |||||
Occupancy and other | 38,371 | 37,401 | 127,702 | 119,987 | |
Total company restaurant costs | 2,695 | 2,829 | 8,337 | 7,894 | |
Franchise advertising and other services expenses | 41,882 | 0 | 136,397 | 0 | |
Royalty and Other | |||||
Revenues | 40,180 | 38,787 | 130,840 | 124,387 | |
Franchise contributions for advertising and other services [Domain] | |||||
Revenues | $ 40,386 | $ 0 | $ 131,189 | $ 0 | |
[1] | Percentages may not add due to rounding. | ||||
[2] | Earnings per share may not add due to rounding. |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 13,189 | $ 45,307 | $ 72,376 | $ 105,102 |
Net change in fair value of derivatives | 1,494 | 16,080 | ||
Net loss reclassified to earnings | 539 | 3,089 | ||
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, before Tax | 12,216 | 2,033 | 703 | 19,169 |
Tax effect | (6,132) | (517) | (3,165) | (4,868) |
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax | 6,084 | 1,516 | (2,462) | 14,301 |
Actuarial losses and prior service costs reclassified to earnings | 904 | 1,152 | 3,013 | 3,838 |
Tax effect | (232) | (292) | (777) | (1,126) |
Unrecognized periodic benefit costs | 672 | 860 | 2,236 | 2,712 |
Foreign currency translation adjustments | 0 | 0 | 0 | 6 |
Tax effect | 0 | 0 | 0 | (2) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 0 | 0 | 0 | 4 |
Derecognition of foreign currency translation adjustments due to sale | 0 | 0 | 0 | 76 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax | 0 | 0 | 0 | 80 |
Other comprehensive income (loss), net of taxes | 6,756 | 2,376 | (226) | 17,093 |
Comprehensive income | $ 19,945 | $ 47,683 | $ 72,150 | $ 122,195 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 07, 2019 | Jul. 08, 2018 | |
Cash flows from operating activities: | ||
Net earnings | $ 72,376 | $ 105,102 |
Earnings from discontinued operations | 2,652 | 19,099 |
Earnings from continuing operations | 69,724 | 86,003 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 42,645 | 46,306 |
Amortization of franchise tenant improvement allowances and other | 1,524 | 497 |
Deferred finance cost amortization | 1,903 | 2,268 |
Excess tax benefits from share-based compensation arrangements | (66) | (2,084) |
Deferred income taxes | (1,745) | 38,544 |
Share-based compensation expense | 6,589 | 7,830 |
Pension and postretirement expense | 1,141 | 1,789 |
Gains on cash surrender value of company-owned life insurance | (3,117) | (1,335) |
Gains on the sale of company-operated restaurants | (219) | (43,088) |
(Gains) losses on the disposition of property and equipment, net | (5,756) | 958 |
Impairment charges and other | 1,624 | 2,205 |
Changes in assets and liabilities, excluding dispositions: | ||
Accounts and other receivables | (3,555) | 945 |
Inventories | (79) | 1,330 |
Prepaid expenses and other current assets | 1,509 | (27,448) |
Accounts payable | 24,321 | 3,135 |
Accrued liabilities | 9,363 | (34,653) |
Pension and postretirement contributions | (5,126) | (4,384) |
Franchise tenant improvement allowance distributions | (7,875) | (9,099) |
Other | (16,012) | (10,351) |
Cash flows provided by operating activities | 116,793 | 59,368 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (25,041) | (25,730) |
Purchases of assets intended for sale and leaseback | 0 | (5,491) |
Proceeds from the sale and leaseback of assets | 3,056 | 7,571 |
Proceeds from the sale of company-operated restaurants | 133 | 23,666 |
Collections on notes receivable | 15,239 | 34,057 |
Proceeds from the sale of property and equipment | 7,563 | 3,799 |
Other | 0 | 2,921 |
Cash flows provided by investing activities | 950 | 40,793 |
Cash flows from financing activities: | ||
Borrowings on revolving credit facilities | 229,798 | 560,800 |
Repayments of borrowings on revolving credit facilities | (252,800) | (412,100) |
Principal repayments on debt | (32,611) | (293,671) |
Debt issuance costs | (5,088) | (1,367) |
Dividends paid on common stock | (30,929) | (34,609) |
Proceeds from issuance of common stock | 696 | 2,365 |
Repurchases of common stock | (14,362) | (200,000) |
Change in book overdraft | 0 | (573) |
Payroll tax payments for equity award issuances | (2,705) | (7,250) |
Cash flows used in financing activities | (108,001) | (386,405) |
Cash flows provided by (used in) continuing operations | 9,742 | (286,244) |
Net cash provided by operating activities of discontinued operations | 0 | 5,159 |
Net cash provided by investing activities of discontinued operations | 0 | 273,653 |
Net cash used in financing activities of discontinued operations | 0 | (78) |
Net cash provided by discontinued operations | 0 | 278,734 |
Effect of exchange rate changes on cash | 0 | 6 |
Cash at beginning of period | 2,705 | 7,642 |
Cash at end of period | $ 12,447 | $ 138 |
Basis Of Presentation
Basis Of Presentation | 9 Months Ended |
Jul. 07, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis Of Presentation | Nature of operations — Founded in 1951, Jack in the Box Inc. (the “Company”) operates and franchises Jack in the Box ® quick-service restaurants. The following table summarizes the number of restaurants as of the end of each period: July 7, July 8, Company-operated 137 146 Franchise 2,105 2,095 Total system 2,242 2,241 References to the Company throughout these notes to condensed consolidated financial statements are made using the first person notations of “we,” “us” and “our.” Basis of presentation — The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). These financial statements should be read in conjunction with the consolidated financial statements and related notes contained in our Annual Report on Form 10-K for the fiscal year ended September 30, 2018 (“2018 Form 10-K”). The accounting policies used in preparing these condensed consolidated financial statements are the same as those described in our 2018 Form 10-K with the exception of two new accounting pronouncements adopted in fiscal 2019 , which are described below. On December 19, 2017, we entered into a definitive agreement to sell Qdoba Restaurant Corporation (“Qdoba”), a wholly owned subsidiary of the Company which operates and franchises more than 700 Qdoba Mexican Eats ® fast-casual restaurants, to certain funds managed by affiliates of Apollo Global Management, LLC (together with its consolidated subsidiaries, the “Buyer”). The sale was completed on March 21, 2018. For all periods presented in our condensed consolidated statements of earnings, all sales, costs, expenses and income taxes attributable to Qdoba, except as related to the impact of the decrease in the federal statutory tax rate (see Note 9, Income Taxes) , have been aggregated under the caption “(Losses) earnings from discontinued operations, net of income taxes.” Refer to Note 3, Discontinued Operations , for additional information. Unless otherwise noted, amounts and disclosures throughout these notes to condensed consolidated financial statements relate to our continuing operations. In our opinion, all adjustments considered necessary for a fair presentation of financial condition and results of operations for these interim periods have been included. Operating results for one interim period are not necessarily indicative of the results for any other interim period or for the full year. Segment reporting — As a result of our sale of Qdoba, which has been classified as discontinued operations, we now have one reporting segment. Reclassifications and adjustments — We recorded certain adjustments in fiscal 2019 upon the adoption of a new accounting pronouncement; see details regarding the effects of the adoption on our condensed consolidated financial statements below. Fiscal year — Our fiscal year is 52 or 53 weeks ending the Sunday closest to September 30 . Fiscal years 2019 and 2018 include 52 weeks. Our first quarter includes 16 -weeks and all other quarters include 12 -weeks. All comparisons between 2019 and 2018 refer to the 12-weeks (“quarter”) and 40-weeks (“year-to-date”) ended July 7, 2019 and July 8, 2018 , respectively, unless otherwise indicated. Use of estimates — In preparing the condensed consolidated financial statements in conformity with U.S. GAAP, management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities, revenues, expenses and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially from these estimates. Advertising costs — We administer a marketing fund which includes contractual contributions. In 2019 and 2018, marketing fund contributions from franchise and company-operated restaurants were approximately 5.0% of gross revenues, and year-to-date incremental contributions made by the Company were $2.0 million and $3.3 million , respectively. Production costs of commercials, programming and other marketing activities are charged to the marketing fund when the advertising is first used for its intended purpose, and the costs of advertising are charged to operations as incurred. Total contributions made by the Company, including incremental contributions, are included in “Selling, general, and administrative expenses” in the accompanying condensed consolidated statements of earnings. Advertising costs for the quarter and year-to-date in 2019 were $4.0 million and $15.0 million , respectively, and in 2018 were $5.9 million and $22.0 million , respectively. Effect of new accounting pronouncements adopted in fiscal 2019 — In May 2014, the FASB issued ASU 2014-09, Revenue Recognition - Revenue from Contracts with Customers (Topic 606) (“ASC 606”), which provides a comprehensive new revenue recognition model that requires an entity to recognize revenue in an amount that reflects the consideration the entity expects to receive for the transfer of promised goods or services to its customers. The standard also requires additional disclosure regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We adopted the new standard on October 1, 2018 using the modified retrospective method, whereby the cumulative effect of this transition to applicable contracts with customers that were not completed as of October 1, 2018 was recorded as an adjustment to beginning retained earnings as of this date. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The new revenue recognition standard did not impact our recognition of restaurant sales, rental revenues, or royalty fees from franchisees. The new pronouncement changed the way initial fees from franchisees for new restaurant openings or new franchise terms are recognized. Under the previous revenue recognition guidance, initial franchise fees were recognized as revenue at the time when a new restaurant opened or at the start of a new franchise term. In accordance with the new guidance, the initial franchise services are not distinct from the continuing rights and services offered during the term of the franchise agreement and will therefore be treated as a single performance obligation together with the continuing rights and services. As such, initial fees received will be recognized over the franchise term and any unamortized portion will be recorded as deferred revenue in our condensed consolidated balance sheet. An adjustment to opening retained earnings and a corresponding contract liability of approximately $50.3 million (of which $5.0 million was current and $45.3 million was long-term) was established on the date of adoption. A deferred tax asset of approximately $13.0 million related to this contract liability was also established on the date of adoption. The new standard also had an impact on transactions presented net and not included in our revenues and expenses such as franchisee contributions to and expenditures from our advertising fund, and sourcing and technology fee contributions from franchisees and the related expenses. We determined that we are the principal in these arrangements, and as such, contributions to and expenditures from the advertising fund, and sourcing and technology fees and expenditures are now reported on a gross basis within our consolidated statements of earnings. While this change materially impacted our gross amount of reported revenues and expenses, the impact will be largely offsetting with no material impact to our reported net earnings. However, any annual surplus or deficit in the marketing fund will impact income from operations and net income. The following table summarizes the impacts of adopting ASC 606 on the Company’s condensed consolidated financial statements as of and for the 12-weeks and 40-weeks ended July 7, 2019 (in thousands) : Adjustments As Reported Franchise Fees Marketing and Sourcing Fees Technology Support Fees Balances without Adoption Condensed Consolidated Statements of Earnings 12-Weeks Ended July 7, 2019 Franchise royalties and other $ 40,180 $ (918 ) $ — $ — $ 39,262 Franchise contributions for advertising and other services $ 40,386 $ — $ (38,133 ) $ (2,253 ) $ — Total revenues $ 222,359 $ (918 ) $ (38,133 ) $ (2,253 ) $ 181,055 Franchise advertising and other services expenses $ 41,882 $ — $ (38,133 ) $ (3,749 ) $ — Selling, general and administrative expenses $ 24,389 $ — $ — $ 1,496 $ 25,885 Total operating costs and expenses, net $ 174,098 $ — $ (38,133 ) $ (2,253 ) $ 133,712 Earnings from operations $ 48,261 $ (918 ) $ — $ — $ 47,343 Earnings from continuing operations and before income taxes $ 11,425 $ (918 ) $ — $ — $ 10,507 Income tax (benefit) expense $ (2,048 ) $ (237 ) $ — $ — $ (2,285 ) Earnings from continuing operations $ 13,473 $ (681 ) $ — $ — $ 12,792 Net earnings $ 13,189 $ (681 ) $ — $ — $ 12,508 40-Weeks Ended July 7, 2019 Franchise royalties and other $ 130,840 $ (2,983 ) $ — $ — $ 127,857 Franchise contributions for advertising and other services $ 131,189 $ — $ (124,187 ) $ (7,002 ) $ — Total revenues $ 728,872 $ (2,983 ) $ (124,187 ) $ (7,002 ) $ 594,700 Franchise advertising and other services expenses $ 136,397 $ — $ (124,187 ) $ (12,210 ) $ — Selling, general and administrative expenses $ 66,057 $ — $ — $ 5,208 $ 71,265 Total operating costs and expenses, net $ 575,164 $ — $ (124,187 ) $ (7,002 ) $ 443,975 Earnings from operations $ 153,708 $ (2,983 ) $ — $ — $ 150,725 Earnings from continuing operations and before income taxes $ 85,423 $ (2,983 ) $ — $ — $ 82,440 Income tax (benefit) expense $ 15,699 $ (769 ) $ — $ — $ 14,930 Earnings from continuing operations $ 69,724 $ (2,214 ) $ — $ — $ 67,510 Net earnings $ 72,376 $ (2,214 ) $ — $ — $ 70,162 Condensed Consolidated Balance Sheet July 7, 2019 Prepaid expenses $ 17,484 $ 769 $ — $ — $ 18,253 Total current assets $ 105,997 $ 769 $ — $ — $ 106,766 Deferred tax assets $ 72,903 $ (12,958 ) $ — $ — $ 59,945 Other assets, net $ 215,234 $ 269 $ — $ — $ 215,503 Total other assets $ 335,335 $ (12,689 ) $ — $ — $ 322,646 Total assets $ 831,270 $ (11,920 ) $ — $ — $ 819,350 Accrued liabilities $ 124,823 $ (4,968 ) $ — $ — $ 119,855 Total current liabilities $ 218,849 $ (4,968 ) $ — $ — $ 213,881 Other long-term liabilities $ 221,219 $ (42,067 ) $ — $ — $ 179,152 Total long-term liabilities $ 1,192,982 $ (42,067 ) $ — $ — $ 1,150,915 Retained earnings $ 1,565,287 $ 35,114 $ — $ — $ 1,600,401 Total stockholders’ deficit $ (580,561 ) $ 35,114 $ — $ — $ (545,447 ) Total liabilities and stockholders’ deficit $ 831,270 $ (11,921 ) $ — $ — $ 819,349 The adoption of ASC 606 had no impact on the Company’s cash provided by or used in operating, investing or financing activities as previously reported in its condensed consolidated statement of cash flows. In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This standard requires the presentation of the service cost component of net benefit costs to be in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. All other components of net benefit costs should be presented separately from the service cost component and outside of a subtotal of earnings from operations, or separately disclosed. We adopted this standard in the first quarter of fiscal 2019 applying the retrospective method. As a result of the adoption, 2018 quarter and year-to-date amounts of $0.4 million and $1.4 million , respectively, previously reported within “Selling, general, and administrative expenses” have been reclassified to a separate line under earnings from operations to conform to current year presentation. Effect of new accounting pronouncements to be adopted in future periods — In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (as subsequently amended by ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01) which requi res a lessee to recognize assets and liabilities on the balance sheet for those leases classified as operating leases under previous guidance. Based on a preliminary assessment, we expect that most of our operating lease commitments will be subject to the new guidance and recognized as operating lease liabilities and right-of-use assets upon adoption, resulting in a significant increase in the assets and liabilities on our consolidated balance sheets. The accounting guidance for lessors will remain largely unchanged from previous guidance, with the exception of the presentation of certain lease costs that the Company passes through to lessees, including but not limited to, property taxes and maintenance. These costs are generally paid by the Company and reimbursed by the lessee. Historically, these costs have been recorded on a net basis in the consolidated statements of operations, but will be presented gross upon adoption of the new guidance. While we are unable to quantify the impact at this time, we do not expect the adoption of this guidance to have a material impact on our consolidated statement of earnings and statement of cash flows. We will be required to adopt this standard in the first quarter of fiscal 2020 and plan to utilize the alternative transition method, whereby an entity records a cumulative adjustment to opening retained earnings in the year of adoption without restating prior periods. The new standard also provides a number of optional practical expedients in transition. We expect to elect the transition package of three practical expedients, which, among other items, permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We also expect to elect the short-term lease recognition exemption for all leases that qualify, permitting us to not apply the recognition requirements of this standard to leases with a term of 12 months or less. We also expect to elect the practical expedient to not separate lease and non-lease components for all of our leases. We do not expect to elect the use-of-hindsight practical expedient, and therefore expect to continue to utilize lease terms determined under the existing lease guidance. |
Revenue (Notes)
Revenue (Notes) | 9 Months Ended |
Jul. 07, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | Nature of products and services — We derive revenue from retail sales at Jack in the Box company-operated restaurants and rental revenue, royalties, advertising, and franchise and other fees from franchise-operated restaurants. Our franchise arrangements generally provide for an initial franchise fee of $50,000 per restaurant and generally require that franchisees pay royalty and marketing fees at 5% of gross sales. The agreement also requires franchisees to pay sourcing, technology and other miscellaneous fees. Significant accounting policy — “Company restaurant sales” include revenue recognized upon delivery of food and beverages to the customer at company-operated restaurants, which is when our obligation to perform is satisfied. Company restaurant sales exclude taxes collected from the Company’s customers. Company restaurant sales also include income for gift cards. Gift cards, upon customer purchase, are recorded as deferred income and are recognized in revenue as they are redeemed. The timing and amount of revenue recognized related to company restaurant sales was not impacted by the adoption of ASC 606. “Franchise royalties and other” includes royalties fees and franchise and other fees received from franchisees. Royalties are based upon a percentage of sales of the franchised restaurant and are recognized as earned. Franchise royalties are billed on a monthly basis. Franchise fees when a new restaurant opens or at the start of a new franchise term are recorded as deferred revenue when received and recognized as revenue over the term of the franchise agreement. “Franchise contributions for advertising and other services” includes franchisee contributions to our marketing fund billed on a monthly basis and sourcing and technology fees, as required under the franchise agreements. Contributions to our marketing fund are based on a percentage of sales and recognized as earned. Sourcing and technology services are recognized when the goods or services are transferred to the franchisee. The adoption of the new revenue standard did not impact the timing of revenue recognition for these fees received; however, these arrangements are now presented on a gross basis because we believe we are the principal in the arrangement. “Franchise rental revenues” received from franchised restaurants based on fixed rental payments are recognized as revenue over the term of the lease. Certain franchise rents, which are contingent upon sales levels, are recognized in the period in which the contingency is met. Rental revenues are accounted for in accordance with applicable guidance for leases and are excluded from the scope of the new revenue standard. Disaggregation of revenue — The following table disaggregates revenue by primary source for the 12-weeks and 40-weeks ended July 7, 2019 (in thousands) : Quarter Year-to-date Sources of revenue: Company restaurant sales $ 78,434 $ 257,948 Franchise rental revenues 63,359 208,895 Franchise royalties 38,752 125,407 Marketing fees 37,269 121,078 Technology and sourcing fees 3,117 10,111 Franchise fees and other services 1,428 5,433 Total revenue $ 222,359 $ 728,872 Contract liabilities — Our contract liabilities consist of deferred revenue resulting from initial fees received from franchisees for new restaurant openings or new franchise terms, which are generally recognized over the franchise term. We classify these contract liabilities as “Other long-term liabilities” and “Accrued liabilities” in our condensed consolidated balance sheets. A summary of significant changes in our contract liabilities between the date of adoption (October 1, 2018) and July 7, 2019 is presented below (in thousands) : Deferred Franchise Fees Deferred franchise fees at October 1, 2018 $ 50,018 Revenue recognized during the period (3,953 ) Additions during the period 970 Deferred franchise fees at July 7, 2019 $ 47,035 The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied at the end of the period (in thousands) : 2019 (1) $ 1,145 2020 4,878 2021 4,856 2022 4,656 2023 4,501 Thereafter 26,999 $ 47,035 ____________________________ (1) Represents the estimate for remainder of fiscal year 2019. We have applied the optional exemption, as provided for under ASC 606, which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Jul. 07, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | DISCONTINUED OPERATIONS Qdoba — In December 2017, we entered into a stock purchase agreement (the “Qdoba Purchase Agreement”) with the Buyer to sell all issued and outstanding shares of Qdoba. The Buyer completed the acquisition of Qdoba on March 21, 2018 (the “Qdoba Sale”). We also entered into a Transition Services Agreement with the Buyer pursuant to which the Buyer is receiving certain services (the “Services”) to enable it to operate the Qdoba business after the closing of the Qdoba Sale. The Services include information technology, finance and accounting, human resources, supply chain and other corporate support services. Under the Agreement, the Services are being provided at cost for a period of up to 12 months, with two 3 -month extensions available for certain services. We are still providing accounting and information technology services under the Agreement and currently estimate these services will be performed up to, but no later than, September 21, 2019. In 2019 and 2018, we recorded $0.9 million and $3.6 million in the quarter, respectively, and $6.5 million and $4.7 million year-to-date, respectively, in income related to the Services as a reduction of selling, general and administrative expenses in the condensed consolidated statements of earnings. Further, in 2018, we entered into an Employee Agreement with the Buyer pursuant to which we continued to employ all Qdoba employees who work for the Buyer (the “Qdoba Employees”) from the date of closing of the Qdoba Sale through December 31, 2018. During the term of the Employee Agreement, we paid all wages and benefits of the Qdoba Employees and received reimbursement of these costs from the Buyer. From October 1, 2018 to December 31, 2018, we paid $35.4 million of Qdoba wages and benefits pursuant to the Employee Agreement. As the Qdoba Sale represents a strategic shift that had a major effect on our operations and financial results, in accordance with the provisions of FASB authoritative guidance on the presentation of financial statements, Qdoba results are classified as discontinued operations in our condensed consolidated statements of earnings and our condensed consolidated statements of cash flows for all periods presented. Income taxes — In fiscal 2019, the Company entered into a bilateral California election with Quidditch Acquisition, Inc. to retroactively treat the divestment of Qdoba Restaurant Corporation on March 21, 2018 as a sale of assets instead of a stock sale for income tax purposes. This election reduced the Company’s fiscal year 2018 California tax liability on the divestment by $2.8 million . The following table summarizes the Qdoba-related activity for each period in discontinued operations ( in thousands, except per share data ): Quarter Year-to-date July 7, July 8, July 7, July 8, Company restaurant sales $ — $ — $ — $ 192,620 Franchise revenues — — — 9,337 Company restaurant costs (excluding depreciation and amortization) — — — (166,122 ) Franchise costs (excluding depreciation and amortization) — — — (2,338 ) Selling, general and administrative expenses (120 ) (202 ) 123 (18,314 ) Depreciation and amortization — — — (5,012 ) Impairment and other charges, net (262 ) (123 ) (262 ) (2,386 ) Interest expense, net — — — (4,787 ) Operating (losses) earnings from discontinued operations before income taxes (382 ) (325 ) (139 ) 2,998 Gain (loss) on Qdoba Sale — (3,648 ) (85 ) 32,081 (Losses) earnings from discontinued operations before income taxes (382 ) (3,973 ) (224 ) 35,079 Income tax benefit (expense) 98 1,097 2,876 (15,927 ) (Losses) earnings from discontinued operations, net of income taxes $ (284 ) $ (2,876 ) $ 2,652 $ 19,152 Net earnings per share from discontinued operations: Basic $ (0.01 ) $ (0.10 ) $ 0.10 $ 0.66 Diluted $ (0.01 ) $ (0.10 ) $ 0.10 $ 0.65 Selling, general and administrative expenses presented in the table above include corporate costs directly in support of Qdoba operations, as well as resolutions of certain matters that existed prior to the Qdoba sale. All other corporate costs were classified in results of continuing operations. Our credit facility required us to make a mandatory prepayment (“Qdoba Prepayment”) on our term loan upon the closing of the Qdoba Sale, which was $260.0 million . In accordance with authoritative guidance on financial statement presentation, interest expense associated with our credit facility was allocated to discontinued operations in the prior year based on our estimate of the mandatory prepayment that was made upon closing of the Qdoba Sale. Lease guarantees — While all operating leases held in the name of Qdoba were part of the Qdoba Sale, some of the leases remain guaranteed by the Company pursuant to one or more written guarantees (the “Guarantees”). In the event Qdoba fails to meet its payment and performance obligations under such guaranteed leases, we may be required to make rent and other payments to the landlord under the requirements of the Guarantees. Should we, as guarantor of the lease obligations, be required to make any lease payments due for the remaining term of the subject lease(s) subsequent to March 21, 2018, the maximum amount we may be required to pay is approximately $33.8 million as of July 7, 2019. The lease terms extend for a maximum of approximately 16 more years as of July 7, 2019, and we would remain a guarantor of the leases in the event the leases are extended for any established renewal periods. In the event that we are obligated to make payments under the Guarantees, we believe the exposure is limited due to contractual protections and recourse available in the lease agreements, as well as the Qdoba Purchase Agreement, including a requirement of the landlord to mitigate damages by re-letting the properties in default, and indemnity from the Buyer. Qdoba continues to meet its obligations under these leases and there have not been any events that would indicate that Qdoba will not continue to meet the obligations of the leases. As such, we have not recorded a liability for the Guarantees as the likelihood of Qdoba defaulting on the assigned agreements was deemed to be less than probable. |
Indebtedness
Indebtedness | 9 Months Ended |
Jul. 07, 2019 | |
Debt Disclosure [Abstract] | |
Indebtedness | INDEBTEDNESS Amended credit facility — On May 1, 2019, we entered into the Fifth Amendment to the Credit Agreement (the “Fifth Amendment”). The Fifth Amendment extended the maturity date of both our term loan and revolving credit facility from March 19, 2020 to March 19, 2021. Fees of $1.3 million paid to third parties in connection with the Fifth Amendment were capitalized as deferred loan costs during the quarter. As of July 7, 2019 , we had outstanding borrowings of $304.4 million under the term loan and $707.4 million under the revolving credit facility. In addition, letters of credit of $29.9 million were outstanding. As of July 7, 2019 , our unused borrowing capacity was $162.7 million . Subsequent events — See Note 16, Subsequent Events , as to events occurring after July 7, 2019 |
Summary Of Refranchisings, Fran
Summary Of Refranchisings, Franchisee Development And Acquisitions | 9 Months Ended |
Jul. 07, 2019 | |
Summary Of Refranchisings, Franchisee Development And Acquisitions [Abstract] | |
Summary Of Refranchisings, Franchisee Development And Acquisitions | Refranchisings and franchisee development — The following table summarizes the number of restaurants sold to franchisees, the number of restaurants developed by franchisees, and gains recognized in each period ( dollars in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Restaurants sold to franchisees — 42 — 127 New restaurants opened by franchisees 5 — 16 8 Proceeds from the sale of company-operated restaurants: Cash (1) $ — $ 6,822 $ 133 $ 23,666 Notes receivable — 33,042 — 64,548 — 39,864 133 88,214 Net assets sold (primarily property and equipment) — (6,745 ) — (19,891 ) Lease commitment charges — — — (863 ) Goodwill related to the sale of company-operated restaurants — (566 ) (2 ) (4,526 ) Other (2) — (3,877 ) 88 (19,846 ) Gains on the sale of company-operated restaurants $ — $ 28,676 $ 219 $ 43,088 ____________________________ (1) The year-to-date amounts in 2019 and 2018 include additional proceeds of $0.1 million and $1.3 million , respectively, related to restaurants sold in prior years. (2) Amounts in 2018 are primarily related to an $8.8 million reduction of gains related to the modification of certain 2017 refranchising transactions. The quarter and year-to-date amounts in 2018 also include $2.9 million and $8.1 million , respectively, of costs related to franchise remodel incentives. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Jul. 07, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Financial assets and liabilities — The following table presents our financial assets and liabilities measured at fair value on a recurring basis ( in thousands ): Total Quoted Prices in Active Markets for Identical Assets (3) (Level 1) Significant Other Observable Inputs (3) (Level 2) Significant Unobservable Inputs (3) (Level 3) Fair value measurements as of July 7, 2019: Non-qualified deferred compensation plan (1) $ 31,012 $ 31,012 $ — $ — Total liabilities at fair value $ 31,012 $ 31,012 $ — $ — Fair value measurements as of September 30, 2018: Non-qualified deferred compensation plan (1) $ 37,447 $ 37,447 $ — $ — Interest rate swaps (Note 7) (2) 703 — 703 — Total liabilities at fair value $ 38,150 $ 37,447 $ 703 $ — ____________________________ (1) We maintain an unfunded defined contribution plan for key executives and other members of management. The fair value of this obligation is based on the closing market prices of the participants’ elected investments. The obligation is included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets. (2) We entered into interest rate swaps to reduce our exposure to rising interest rates on our variable rate debt. The fair values of our interest rate swaps are based upon Level 2 inputs which include valuation models as reported by our counterparties. These valuation models use a discounted cash flow analysis on the cash flows of each derivative. The key inputs for the valuation models are quoted market prices, discount rates, and forward yield curves. The Company also considers its own nonperformance risk and the respective counter-party’s nonperformance risk in the fair value measurements. As further described in Note 7, Derivatives , the Company’s interest rate swaps were terminated on July 2, 2019 and settled in connection with our refinancing transaction on July 8, 2019. (3) We did not have any transfers in or out of Level 1, 2 or 3. The fair values of our debt instruments are based on the amount of future cash flows associated with each instrument discounted using our borrowing rate. At July 7, 2019 , the carrying value of all financial instruments was not materially different from fair value, as the borrowings are prepayable without penalty. The estimated fair values of our capital lease obligations approximated their carrying values as of July 7, 2019 . Non-financial assets and liabilities — Our non-financial instruments, which primarily consist of property and equipment, goodwill and intangible assets, are reported at carrying value and are not required to be measured at fair value on a recurring basis. However, on an annual basis, or whenever events or changes in circumstances indicate that their carrying value may not be recoverable, non-financial instruments are assessed for impairment. If applicable, the carrying values are written down to fair value. In connection with our impairment reviews performed during 2019, no material fair value adjustments were required. Refer to Note 8, Impairment and Other Charges, Net , for additional information regarding impairment charges. |
Derivative Instruments
Derivative Instruments | 9 Months Ended |
Jul. 07, 2019 | |
Derivative Instruments and Hedges, Assets [Abstract] | |
Derivative Instruments | DERIVATIVE INSTRUMENTS Interest rate swaps — We have used interest rate swaps to mitigate interest rate volatility with regard to variable rate borrowings under our senior credit facility. In June 2015, we entered into forward-starting interest rate swap agreements that effectively converted $500.0 million of our variable rate borrowings to a fixed rate from October 2018 through October 2022. These agreements were designated as cash flow hedges under the terms of the FASB authoritative guidance for derivatives and hedging. To the extent that they were effective in offsetting the variability of the hedged cash flows, changes in the fair values of the derivatives are not included in earnings but are included in other comprehensive income (“OCI”). These changes in fair value were subsequently reclassified into net earnings as a component of interest expense as the hedged interest payments are made on our variable rate debt. Effective July 2, 2019, the Company terminated all interest rate swap agreements in anticipation of the securitization transaction and related retirement of our senior credit facility (see Note 16, Subsequent Events) . The fair value of the interest rate swaps at the termination date was $23.6 million , which was paid on July 8, 2019. As a result of the decision to extinguish the senior credit facility, forecasted cash flows associated with the variable-rate debt interest payments were no longer considered to be probable. Consequently, unrealized losses in other comprehensive income at the termination date were immediately reclassified to “Interest expense, net” in the condensed consolidated statement of earnings. Financial position — The following derivative instruments were outstanding as of the end of each period ( in thousands ): Balance Sheet Location Fair Value July 7, September 30, 2018 Derivatives designated as hedging instruments: Interest rate swaps Accrued liabilities $ — $ (26 ) Interest rate swaps Other long-term liabilities — (1,266 ) Interest rate swaps Other assets, net — 589 Total derivatives $ — $ (703 ) Financial performance — The following table summarizes the OCI activity related to our interest rate swap derivative instruments and the amounts reclassified from accumulated OCI ( in thousands ): Location in Income Quarter Year-to-date July 7, July 8, July 7, July 8, (Loss) gain recognized in OCI N/A $ (11,499 ) $ 1,494 $ (23,625 ) $ 16,080 Loss reclassified from accumulated OCI into net earnings Interest expense, net $ 23,715 $ 539 $ 24,328 $ 3,089 |
Impairment and other charges, n
Impairment and other charges, net | 9 Months Ended |
Jul. 07, 2019 | |
Restructuring and Related Activities [Abstract] | |
Impairment and other charges, net | IMPAIRMENT AND OTHER CHARGES, NET Impairment and other charges, net in the accompanying condensed consolidated statements of earnings is comprised of the following ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Restructuring costs $ (64 ) $ 1,872 $ 6,722 $ 4,805 Costs of closed restaurants and other 2,010 378 3,259 3,483 Accelerated depreciation 416 538 1,342 912 (Gains) losses on disposition of property and equipment, net (1) (5,618 ) 477 (5,756 ) 958 Operating restaurant impairment charges (2) — — — 291 $ (3,256 ) $ 3,265 $ 5,567 $ 10,449 ____________________________ (1) In 2019, includes a $0.8 million gain recognized in the second quarter related to an eminent domain transaction and a $5.7 million gain related to a sale of property recognized in the third quarter. (2) In 2018, impairment charges relate to our landlord’s sale of a restaurant property to a franchisee. Restructuring costs — Restructuring charges include costs resulting from the exploration of strategic alternatives (the “Strategic Alternatives Evaluation”) in 2019 , and a plan that management initiated to reduce our general and administrative costs. Restructuring charges in 2018 also include costs related to the evaluation of potential alternatives with respect to the Qdoba brand (the “Qdoba Evaluation”), which resulted in the Qdoba Sale. Refer to Note 3, Discontinued Operations, for information regarding the Qdoba Sale. The following is a summary of our restructuring costs (in thousands) : Quarter Year-to-date July 7, July 8, July 7, July 8, Employee severance and related costs $ 287 $ 1,476 $ 5,436 $ 2,828 Strategic Alternatives Evaluation (1) (351 ) 376 1,286 1,188 Qdoba Evaluation (2) — 20 — 788 Other — — — 1 $ (64 ) $ 1,872 $ 6,722 $ 4,805 ____________________________ (1) Strategic Alternative Evaluation costs are primarily related to third party advisory services. (2) Qdoba Evaluation costs are primarily related to retention compensation and third party advisory services. We currently expect to recognize severance and related costs of approximately $0.2 million for t he remainder of fiscal 2019 related to positions that have been identified for elimination. At this time, we are unable to estimate any additional charges to be incurred related to additional positions that may be identified for elimination or our other restructuring activities. Total accrued severance costs related to our restructuring activities are included in “Accrued liabilities” on our condensed consolidated balance sheets, and changed as follows during 2019 (in thousands) : Balance as of September 30, 2018 $ 5,309 Costs incurred 5,946 Accruals released (605 ) Cash payments (8,167 ) Balance as of July 7, 2019 $ 2,483 Costs of closed restaurants and other — Costs of closed restaurants and other is generally comprised of future lease commitment charges and expected ancillary costs, net of anticipated sublease rentals, impairment and other costs associated with closed restaurants, and canceled project costs. The liability for lease termination costs related to closed restaurants, included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets, changed as follows during 2019 ( in thousands ): Balance as of September 30, 2018 $ 3,534 Additions — Adjustments (1) 572 Interest expense 1,094 Cash payments (3,156 ) Balance as of July 7, 2019 (2) (3) $ 2,044 ___________________________ (1) Adjustments relate primarily to revisions of certain sublease and cost assumptions. Our estimates related to our future lease obligations, primarily the sublease income we anticipate, are subject to a high degree of judgment and may differ from actual sublease income due to changes in economic conditions, desirability of the sites and other factors. (2) The weighted average remaining lease term related to these commitments is approximately 4 years. (3) This balance excludes $1.7 million of restaurant closing costs that are included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets, which were initially recorded as losses on the sale of company-operated restaurants to franchisees. Accelerated depreciation |
Income Taxes
Income Taxes | 9 Months Ended |
Jul. 07, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Our tax rates for the quarter and year-to-date ended July 7, 2019 were impacted by the Tax Cuts and Jobs Act (the “Tax Act”), which was enacted into law on December 22, 2017. As a fiscal year taxpayer, the corporate federal tax rate reduction from 35% to 21% was phased in, resulting in a statutory federal tax rate of 24.5% for our fiscal year ending September 30, 2018, and 21.0% for our fiscal year ending September 29, 2019 and subsequent fiscal years. In 2019 and 2018, income tax provisions reflect quarter tax rates of (17.9)% and 26.5% , respectively, and year-to-date tax rates of 18.4% and 46.9% , respectively. The major components of the year-over-year change in tax rates were the one-time, non-cash impact of the enactment of the Tax Act in fiscal year 2018, a decrease in the statutory tax rate, the impact of the termination of interest rate swap agreements, the release of valuation reserves on state tax credits and losses, and the release of a federal tax liability due to expiration of the statute of limitations. The final annual tax rate cannot be determined until the end of the fiscal year; therefore, the actual rate could differ from our current estimates. The following is a summary of the components of each tax rate (dollars in thousands) : Quarter Year-to-date July 7, July 8, July 7, July 8, Income tax expense at statutory rate $ 2,948 25.8 % $ 18,715 28.6 % $ 22,040 25.8 % $ 46,752 28.9 % One-time, non-cash impact of the Tax Act — — % 878 1.3 % — — % 32,082 19.8 % Termination of interest rate swaps (2,984 ) (26.1 )% — — % (2,984 ) (3.5 )% — — % Release of valuation reserve on state tax losses and credits (873 ) (7.6 )% (1,312 ) (2.0 )% (1,023 ) (1.2 )% (1,312 ) (0.8 )% Release of federal tax liability (817 ) (7.2 )% — — % (817 ) (1.0 )% — — % Stock compensation excess tax expense (18 ) (0.2 )% (1,268 ) (1.9 )% (66 ) (0.1 )% (2,084 ) (1.3 )% Adjustment to state tax provision — — % — — % (1,027 ) (1.2 )% — — % Other (304 ) (2.6 )% 321 0.5 % (424 ) (0.4 )% 460 0.3 % (1) $ (2,048 ) (17.9 )% $ 17,334 26.5 % $ 15,699 18.4 % $ 75,898 46.9 % ____________________________ (1) Percentages may not add due to rounding. |
Retirement Plans
Retirement Plans | 9 Months Ended |
Jul. 07, 2019 | |
Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract] | |
Retirement Plans | Defined benefit pension plans — We sponsor two defined benefit pension plans, a frozen “Qualified Plan” covering substantially all full-time employees hired prior to January 1, 2011 , and an unfunded supplemental executive retirement plan (“SERP”) which provides certain employees additional pension benefits and was closed to new participants effective January 1, 2007 . Benefits under both plans are based on the employee’s years of service and compensation over defined periods of employment. Postretirement healthcare plans — We also sponsor two healthcare plans, closed to new participants, that provide postretirement medical benefits to certain employees who have met minimum age and service requirements. The plans are contributory; with retiree contributions adjusted annually, and contain other cost-sharing features such as deductibles and coinsurance. Net periodic benefit cost — The components of net periodic benefit cost in each period were as follows ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Defined benefit pension plans: Interest cost $ 5,286 $ 5,159 $ 17,619 $ 17,198 Service cost — 114 — 379 Expected return on plan assets (1) (6,077 ) (6,108 ) (20,257 ) (20,360 ) Actuarial loss (2) 914 1,124 3,046 3,745 Amortization of unrecognized prior service costs (2) 27 34 89 113 Net periodic benefit cost $ 150 $ 323 $ 497 $ 1,075 Postretirement healthcare plans: Interest cost $ 229 $ 220 $ 766 $ 734 Actuarial gain (2) (37 ) (6 ) (122 ) (20 ) Net periodic benefit cost $ 192 $ 214 $ 644 $ 714 ___________________________ (1) Determined as of the beginning of the year based on a return on asset assumption of 6.2% . (2) Amounts were reclassified from accumulated OCI into net earnings as a component of “Other pension and post-retirement expenses, net.” Changes in presentation —As discussed in Note 1, Basis in Presentation , we adopted ASU 2017-07 during the first quarter of 2019 using the retrospective method, which changed the financial statement presentation of service costs and the other components of net periodic benefit cost. The service cost component continues to be included in operating income; however, the other components are now presented in a separate line below earnings from operations captioned “Other pension and post-retirement expenses, net” in our condensed consolidated statements of earnings. Further, in connection with the adoption, plan administrative expenses historically presented as a component of service cost are now presented as a component of expected return on plan assets. The prior year components of net periodic benefit costs have been recast to conform to current year presentation. Future cash flows — Our policy is to fund our plans at or above the minimum required by law. As of January 1, 2018 , the date of our last actuarial funding valuation, there was no minimum contribution funding requirement. Details regarding 2019 contributions are as follows ( in thousands ): SERP Postretirement Healthcare Plans Net year-to-date contributions $ 4,213 $ 913 Remaining estimated net contributions during fiscal 2019 $ 800 $ 500 We continue to evaluate contributions to our Qualified Plan based on changes in pension assets as a result of asset performance in the current market and the economic environment. We do not anticipate making any contributions to our Qualified Plan in fiscal 2019 . |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Jul. 07, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | STOCKHOLDERS’ DEFICIT Summary of changes in stockholders’ deficit — A reconciliation of the beginning and ending amounts of stockholders’ deficit is presented below ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Balance at beginning of period $ (592,514 ) $ (430,910 ) $ (591,699 ) $ (388,130 ) Shares issued under stock plans, including tax benefit 453 2,325 696 2,364 Share-based compensation 1,881 1,684 6,589 7,950 Dividends declared (10,326 ) (11,252 ) (30,967 ) (34,698 ) Purchases of treasury stock — (100,000 ) — (200,000 ) Net earnings 13,189 45,307 72,376 105,102 Other comprehensive income, net of taxes 6,756 2,376 (226 ) 17,093 Cumulative-effect from a change in accounting principle — — (37,330 ) (151 ) Balance at end of period $ (580,561 ) $ (490,470 ) $ (580,561 ) $ (490,470 ) Repurchases of common stock — In 2019, we have not repurchased any common shares. As of July 7, 2019 , there was approximately $101.0 million remaining under the Board-authorized stock buyback program which expires in November 2019. Repurchases of common stock included in our condensed consolidated statement of cash flows for fiscal 2019 includes $14.4 million related to repurchase transactions traded in the prior fiscal year that settled in 2019. Dividends — During year-to-date 2019, the Board of Directors declared three cash dividends of $0.40 per common share which were paid on June 14, 2019, March 19, 2019 and December 18, 2018 to shareholders of record as of the close of business on May 29, 2019, March 4, 2019 and December 5, 2018, respectively, and totaled $31.2 million . Future dividends are subject to approval by our Board of Directors. |
Average Shares Outstanding
Average Shares Outstanding | 9 Months Ended |
Jul. 07, 2019 | |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | |
Average Shares Outstanding | AVERAGE SHARES OUTSTANDING Our basic earnings per share calculation is computed based on the weighted-average number of common shares outstanding. Our diluted earnings per share calculation is computed based on the weighted-average number of common shares outstanding adjusted by the number of additional shares that would have been outstanding had the potentially dilutive common shares been issued. Potentially dilutive common shares include stock options, nonvested stock awards and units, and non-management director stock equivalents. Performance share awards are included in the average diluted shares outstanding each period if the performance criteria have been met at the end of the respective periods. The following table reconciles basic weighted-average shares outstanding to diluted weighted-average shares outstanding ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Weighted-average shares outstanding – basic 25,958 28,042 25,933 28,989 Effect of potentially dilutive securities: Nonvested stock awards and units 206 215 205 241 Stock options 10 32 10 47 Performance share awards 2 7 2 7 Weighted-average shares outstanding – diluted 26,176 28,296 26,150 29,284 Excluded from diluted weighted-average shares outstanding: Antidilutive 186 192 186 139 Performance conditions not satisfied at the end of the period 89 67 89 67 |
Contingencies and Legal Matters
Contingencies and Legal Matters | 9 Months Ended |
Jul. 07, 2019 | |
Legal Matters and Contingencies [Abstract] | |
Contingencies and Legal Matters | CONTINGENCIES AND LEGAL MATTERS Legal matters — We assess contingencies, including litigation contingencies, to determine the degree of probability and range of possible loss for potential accrual in our financial statements. An estimated loss contingency is accrued in the financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable, assessing contingencies is highly subjective and requires judgments about future events. When evaluating litigation contingencies, we may be unable to provide a meaningful estimate due to a number of factors, including the procedural status of the matter in question, the availability of appellate remedies, insurance coverage related to the claim or claims in question, the presence of complex or novel legal theories, and the ongoing discovery and development of information important to the matter. In addition, damage amounts claimed in litigation against us may be unsupported, exaggerated, or unrelated to possible outcomes, and as such are not meaningful indicators of our potential liability or financial exposure. We regularly review contingencies to determine the adequacy of the accruals and related disclosures. The ultimate amount of loss may differ from these estimates. Gessele v. Jack in the Box Inc. — In August 2010, five former employees instituted litigation in federal court in Oregon alleging claims under the federal Fair Labor Standards Act and Oregon wage and hour laws. The plaintiffs alleged that the Company failed to pay non-exempt employees for certain meal breaks and improperly made payroll deductions for shoe purchases and for workers’ compensation expenses, and later added additional claims relating to timing of final pay and related wage and hour claims involving employees of a franchisee. In 2016, the court dismissed the federal claims and those relating to franchise employees. In June 2017, the court granted class certification with respect to state law claims of improper deductions and late payment of final wages. In February 2019, plaintiff’s counsel reduced their earlier demand from $62.0 million to $42.0 million . We have accrued an amount that is not material to our financial statements relating to claims for which we believe a loss is both probable and estimable. We continue to believe that no additional losses are probable beyond this accrual and we cannot estimate a possible loss contingency or range of reasonably possible loss contingencies beyond this accrual. We plan to vigorously defend against this lawsuit. Nonetheless, an unfavorable resolution of this matter in excess of our current accrued loss contingencies could have a material adverse effect on our business, results of operations, liquidity, or financial condition. Ramirez v. Jack in the Box Inc. — On June 11, 2019, an unfavorable jury verdict was delivered in a wrongful termination lawsuit against the Company in Los Angeles Superior Court. Plaintiff in the case was a restaurant employee who was terminated in 2013. The jury’s verdict included $5.4 million in compensatory damages and $10.0 million in punitive damages. The Company disagrees with the verdict and the damages awarded by the jury and has filed post-trial motions with the trial judge for the purpose of setting aside or significantly reducing damages. The Company intends to appeal the verdict in the event its post-trial motions are unsuccessful and a judgment is entered by the trial court. Pending resolution of the appeals process, the payment of any damages in this matter will be stayed. During the third quarter of 2019, a charge of $7.1 million was recorded in “Selling, general, and administrative expenses” related to this case, net of any amounts covered by insurance. We continue to believe that no additional losses are probable beyond this accrual, and we cannot estimate a possible loss contingency or range of reasonably possible loss contingencies beyond this accrual. Other legal matters — In addition to the matter described above, we are subject to normal and routine litigation brought by former or current employees, customers, franchisees, vendors, landlords, shareholders or others. We intend to defend ourselves in any such matters. Some of these matters may be covered, at least in part, by insurance or other third party indemnity obligation. We record receivables from third party insurers when recovery has been determined to be probable. The amount of such receivables recorded at July 7, 2019 was $13.6 million . We believe that the ultimate determination of liability in connection with legal claims pending against us, if any, in excess of amounts already provided for such matters in the consolidated financial statements, will not have a material adverse effect on our business, our annual results of operations, liquidity or financial position; however, it is possible that our business, results of operations, liquidity, or financial condition could be materially affected in a particular future reporting period by the unfavorable resolution of one or more matters or contingencies during such period. Lease guarantees — While all operating leases held in the name of Qdoba were part of the Qdoba Sale, some of the leases remain guaranteed by the Company pursuant to one or more written guarantees. In the event Qdoba fails to meet its payment and performance obligations under such guaranteed leases, we may be required to make rent and other payments to the landlord under the requirements of the Guarantees. Qdoba continues to meet its obligations under these leases and there have not been any events that would indicate that Qdoba will not continue to meet the obligations of the leases. As such, we have not recorded a liability for the Guarantees as the likelihood of Qdoba defaulting on the assigned agreements was deemed to be less than probable. Refer to Note 3, Discontinued Operations , for additional information regarding the Guarantees. |
Supplemental Consolidated Cash
Supplemental Consolidated Cash Flow Information | 9 Months Ended |
Jul. 07, 2019 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Consolidated Cash Flow Information | SUPPLEMENTAL CONSOLIDATED CASH FLOW INFORMATION ( in thousands ) Year-to-date July 7, July 8, Non-cash investing and financing transactions: Decrease in obligations for treasury stock repurchases $ 14,362 $ — Decrease in obligations for purchases of property and equipment $ 5,421 $ 2,456 Increase in dividends accrued or converted to common stock equivalents $ 184 $ 218 Decrease in capital lease obligations from the termination of equipment and building leases $ 41 $ 3,654 Increase in notes receivable from the sale of company-operated restaurants $ — $ 31,160 Equipment capital lease obligations incurred $ — $ 78 |
Supplemental Consolidated Balan
Supplemental Consolidated Balance Sheet Information | 9 Months Ended |
Jul. 07, 2019 | |
Balance Sheet Related Disclosures [Abstract] | |
Supplemental Consolidated Balance Sheet Information | SUPPLEMENTAL CONSOLIDATED BALANCE SHEET INFORMATION (in thousands) July 7, September 30, Accounts and other receivables, net: Trade $ 44,403 $ 35,877 Notes receivable 1,854 11,480 Due from marketing fund 839 — Income tax receivable 184 5,637 Other 12,059 6,123 Allowance for doubtful accounts (1,692 ) (1,695 ) $ 57,647 $ 57,422 Prepaid expenses: Prepaid rent $ 11,977 $ — Prepaid income taxes — 4,837 Prepaid advertising 28 4,318 Other 5,479 5,288 $ 17,484 $ 14,443 Other assets, net: Company-owned life insurance policies $ 113,025 $ 109,908 Deferred rent receivable 49,204 48,372 Franchise tenant improvement allowance 24,328 22,506 Other 28,677 18,480 $ 215,234 $ 199,266 Accrued liabilities: Insurance $ 30,206 $ 35,405 Payroll and related taxes 24,807 29,498 Deferred franchise fees 4,968 375 Deferred rent income 16,960 1,387 Sales and property taxes 4,097 4,555 Gift card liability 2,109 2,081 Other 41,676 33,621 $ 124,823 $ 106,922 Other long-term liabilities: Defined benefit pension plans $ 66,185 $ 69,012 Deferred franchise fees 42,063 — Straight-line rent accrual 29,700 31,762 Other 83,271 92,675 $ 221,219 $ 193,449 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jul. 07, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Securitized Refinancing Transaction — On July 8, 2019, the Company completed the sale of $575.0 million of its Series 2019-1 3.982% Fixed Rate Senior Secured Notes, Class A-2-I (the “Class A-2-I Notes”), $275.0 million of its Series 2019-1 4.476% Fixed Rate Senior Secured Notes, Class A-2-II (the “Class A-2-II Notes”), and $450.0 million of its Series 2019-1 4.970% Fixed Rate Senior Secured Notes, Class A-2-III (the “Class A-2-III Notes” and, together with the Class A-2-I Notes and Class A-2-II Notes, the “2019 Notes”). Interest payments on the 2019 Notes are payable on a quarterly basis. The anticipated repayment dates of the Class A-2-I Notes, the Class A-2-II Notes and the Class A-2-III Notes are August 2023, August 2026 and August 2029, respectively, unless earlier prepaid to the extent permitted under the indenture that will govern the 2019 Notes. The 2019 Notes were issued in a privately placed securitization transaction. In addition, the Company also entered into a purchase agreement under which it will issue up to $150 million of its Series 2019-1 Variable Funding Senior Secured Notes, Class A-1 (the "Class A-1 Notes"), which will allow us to borrow amounts from time to time on a revolving basis. The net proceeds of the sale of the 2019 Notes were used to retire the Company’s existing senior credit facility and to repay transaction costs related to the transaction. The Company intends to use remaining proceeds for working capital purposes and general corporate purposes, which may include a return of capital to the Company’s equity holders. Dividends — On August 2, 2019, the Board of Directors declared a cash dividend of $0.40 per common share, to be paid on September 10, 2019 to shareholders of record as of the close of business on August 19, 2019. Share Repurchases — On August 2, 2019, the Board of Directors authorized an additional $200 million stock buy-back program that expires on November 30, 2020. Purchase Agreement — On July 25, 2019, the Company completed the purchase of a commercial property in Los Angeles, California, on which an existing company restaurant and another retail tenant are located. The purchase price was $17.3 million |
Basis Of Presentation (Policy)
Basis Of Presentation (Policy) | 9 Months Ended |
Jul. 07, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of operations | Nature of operations — Founded in 1951, Jack in the Box Inc. (the “Company”) operates and franchises Jack in the Box ® |
Basis of presentation | Basis of presentation — The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). These financial statements should be read in conjunction with the consolidated financial statements and related notes contained in our Annual Report on Form 10-K for the fiscal year ended September 30, 2018 (“2018 Form 10-K”). The accounting policies used in preparing these condensed consolidated financial statements are the same as those described in our 2018 Form 10-K with the exception of two new accounting pronouncements adopted in fiscal 2019 , which are described below. On December 19, 2017, we entered into a definitive agreement to sell Qdoba Restaurant Corporation (“Qdoba”), a wholly owned subsidiary of the Company which operates and franchises more than 700 Qdoba Mexican Eats ® fast-casual restaurants, to certain funds managed by affiliates of Apollo Global Management, LLC (together with its consolidated subsidiaries, the “Buyer”). The sale was completed on March 21, 2018. For all periods presented in our condensed consolidated statements of earnings, all sales, costs, expenses and income taxes attributable to Qdoba, except as related to the impact of the decrease in the federal statutory tax rate (see Note 9, Income Taxes) , have been aggregated under the caption “(Losses) earnings from discontinued operations, net of income taxes.” Refer to Note 3, Discontinued Operations , for additional information. Unless otherwise noted, amounts and disclosures throughout these notes to condensed consolidated financial statements relate to our continuing operations. In our opinion, all adjustments considered necessary for a fair presentation of financial condition and results of operations for these interim periods have been included. Operating results for one interim period are not necessarily indicative of the results for any other interim period or for the full year. |
Segment reporting | Segment reporting — As a result of our sale of Qdoba, which has been classified as discontinued operations, we now have one reporting segment. |
Reclassification and adjustments | Reclassifications and adjustments — We recorded certain adjustments in fiscal 2019 upon the adoption of a new accounting pronouncement; see details regarding the effects of the adoption on our condensed consolidated financial statements below. |
Fiscal year | Fiscal year — Our fiscal year is 52 or 53 weeks ending the Sunday closest to September 30 . Fiscal years 2019 and 2018 include 52 weeks. Our first quarter includes 16 -weeks and all other quarters include 12 -weeks. All comparisons between 2019 and 2018 refer to the 12-weeks (“quarter”) and 40-weeks (“year-to-date”) ended July 7, 2019 and July 8, 2018 , respectively, unless otherwise indicated. |
Use of estimates | Use of estimates — In preparing the condensed consolidated financial statements in conformity with U.S. GAAP, management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities, revenues, expenses and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially from these estimates. |
Advertising costs | Advertising costs — We administer a marketing fund which includes contractual contributions. In 2019 and 2018, marketing fund contributions from franchise and company-operated restaurants were approximately 5.0% of gross revenues, and year-to-date incremental contributions made by the Company were $2.0 million and $3.3 million , respectively. Production costs of commercials, programming and other marketing activities are charged to the marketing fund when the advertising is first used for its intended purpose, and the costs of advertising are charged to operations as incurred. Total contributions made by the Company, including incremental contributions, are included in “Selling, general, and administrative expenses” in the accompanying condensed consolidated statements of earnings. Advertising costs for the quarter and year-to-date in 2019 were $4.0 million and $15.0 million , respectively, and in 2018 were $5.9 million and $22.0 million , respectively. |
Effect of new accounting pronouncements adopted n fiscal 2018 | Effect of new accounting pronouncements adopted in fiscal 2019 — In May 2014, the FASB issued ASU 2014-09, Revenue Recognition - Revenue from Contracts with Customers (Topic 606) (“ASC 606”), which provides a comprehensive new revenue recognition model that requires an entity to recognize revenue in an amount that reflects the consideration the entity expects to receive for the transfer of promised goods or services to its customers. The standard also requires additional disclosure regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We adopted the new standard on October 1, 2018 using the modified retrospective method, whereby the cumulative effect of this transition to applicable contracts with customers that were not completed as of October 1, 2018 was recorded as an adjustment to beginning retained earnings as of this date. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The new revenue recognition standard did not impact our recognition of restaurant sales, rental revenues, or royalty fees from franchisees. The new pronouncement changed the way initial fees from franchisees for new restaurant openings or new franchise terms are recognized. Under the previous revenue recognition guidance, initial franchise fees were recognized as revenue at the time when a new restaurant opened or at the start of a new franchise term. In accordance with the new guidance, the initial franchise services are not distinct from the continuing rights and services offered during the term of the franchise agreement and will therefore be treated as a single performance obligation together with the continuing rights and services. As such, initial fees received will be recognized over the franchise term and any unamortized portion will be recorded as deferred revenue in our condensed consolidated balance sheet. An adjustment to opening retained earnings and a corresponding contract liability of approximately $50.3 million (of which $5.0 million was current and $45.3 million was long-term) was established on the date of adoption. A deferred tax asset of approximately $13.0 million related to this contract liability was also established on the date of adoption. The new standard also had an impact on transactions presented net and not included in our revenues and expenses such as franchisee contributions to and expenditures from our advertising fund, and sourcing and technology fee contributions from franchisees and the related expenses. We determined that we are the principal in these arrangements, and as such, contributions to and expenditures from the advertising fund, and sourcing and technology fees and expenditures are now reported on a gross basis within our consolidated statements of earnings. While this change materially impacted our gross amount of reported revenues and expenses, the impact will be largely offsetting with no material impact to our reported net earnings. However, any annual surplus or deficit in the marketing fund will impact income from operations and net income. The following table summarizes the impacts of adopting ASC 606 on the Company’s condensed consolidated financial statements as of and for the 12-weeks and 40-weeks ended July 7, 2019 (in thousands) : Adjustments As Reported Franchise Fees Marketing and Sourcing Fees Technology Support Fees Balances without Adoption Condensed Consolidated Statements of Earnings 12-Weeks Ended July 7, 2019 Franchise royalties and other $ 40,180 $ (918 ) $ — $ — $ 39,262 Franchise contributions for advertising and other services $ 40,386 $ — $ (38,133 ) $ (2,253 ) $ — Total revenues $ 222,359 $ (918 ) $ (38,133 ) $ (2,253 ) $ 181,055 Franchise advertising and other services expenses $ 41,882 $ — $ (38,133 ) $ (3,749 ) $ — Selling, general and administrative expenses $ 24,389 $ — $ — $ 1,496 $ 25,885 Total operating costs and expenses, net $ 174,098 $ — $ (38,133 ) $ (2,253 ) $ 133,712 Earnings from operations $ 48,261 $ (918 ) $ — $ — $ 47,343 Earnings from continuing operations and before income taxes $ 11,425 $ (918 ) $ — $ — $ 10,507 Income tax (benefit) expense $ (2,048 ) $ (237 ) $ — $ — $ (2,285 ) Earnings from continuing operations $ 13,473 $ (681 ) $ — $ — $ 12,792 Net earnings $ 13,189 $ (681 ) $ — $ — $ 12,508 40-Weeks Ended July 7, 2019 Franchise royalties and other $ 130,840 $ (2,983 ) $ — $ — $ 127,857 Franchise contributions for advertising and other services $ 131,189 $ — $ (124,187 ) $ (7,002 ) $ — Total revenues $ 728,872 $ (2,983 ) $ (124,187 ) $ (7,002 ) $ 594,700 Franchise advertising and other services expenses $ 136,397 $ — $ (124,187 ) $ (12,210 ) $ — Selling, general and administrative expenses $ 66,057 $ — $ — $ 5,208 $ 71,265 Total operating costs and expenses, net $ 575,164 $ — $ (124,187 ) $ (7,002 ) $ 443,975 Earnings from operations $ 153,708 $ (2,983 ) $ — $ — $ 150,725 Earnings from continuing operations and before income taxes $ 85,423 $ (2,983 ) $ — $ — $ 82,440 Income tax (benefit) expense $ 15,699 $ (769 ) $ — $ — $ 14,930 Earnings from continuing operations $ 69,724 $ (2,214 ) $ — $ — $ 67,510 Net earnings $ 72,376 $ (2,214 ) $ — $ — $ 70,162 Condensed Consolidated Balance Sheet July 7, 2019 Prepaid expenses $ 17,484 $ 769 $ — $ — $ 18,253 Total current assets $ 105,997 $ 769 $ — $ — $ 106,766 Deferred tax assets $ 72,903 $ (12,958 ) $ — $ — $ 59,945 Other assets, net $ 215,234 $ 269 $ — $ — $ 215,503 Total other assets $ 335,335 $ (12,689 ) $ — $ — $ 322,646 Total assets $ 831,270 $ (11,920 ) $ — $ — $ 819,350 Accrued liabilities $ 124,823 $ (4,968 ) $ — $ — $ 119,855 Total current liabilities $ 218,849 $ (4,968 ) $ — $ — $ 213,881 Other long-term liabilities $ 221,219 $ (42,067 ) $ — $ — $ 179,152 Total long-term liabilities $ 1,192,982 $ (42,067 ) $ — $ — $ 1,150,915 Retained earnings $ 1,565,287 $ 35,114 $ — $ — $ 1,600,401 Total stockholders’ deficit $ (580,561 ) $ 35,114 $ — $ — $ (545,447 ) Total liabilities and stockholders’ deficit $ 831,270 $ (11,921 ) $ — $ — $ 819,349 The adoption of ASC 606 had no impact on the Company’s cash provided by or used in operating, investing or financing activities as previously reported in its condensed consolidated statement of cash flows. In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This standard requires the presentation of the service cost component of net benefit costs to be in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. All other components of net benefit costs should be presented separately from the service cost component and outside of a subtotal of earnings from operations, or separately disclosed. We adopted this standard in the first quarter of fiscal 2019 applying the retrospective method. As a result of the adoption, 2018 quarter and year-to-date amounts of $0.4 million and $1.4 million , respectively, previously reported within “Selling, general, and administrative expenses” have been reclassified to a separate line under earnings from operations to conform to current year presentation. Effect of new accounting pronouncements to be adopted in future periods — In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (as subsequently amended by ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01) which requi res a lessee to recognize assets and liabilities on the balance sheet for those leases classified as operating leases under previous guidance. Based on a preliminary assessment, we expect that most of our operating lease commitments will be subject to the new guidance and recognized as operating lease liabilities and right-of-use assets upon adoption, resulting in a significant increase in the assets and liabilities on our consolidated balance sheets. The accounting guidance for lessors will remain largely unchanged from previous guidance, with the exception of the presentation of certain lease costs that the Company passes through to lessees, including but not limited to, property taxes and maintenance. These costs are generally paid by the Company and reimbursed by the lessee. Historically, these costs have been recorded on a net basis in the consolidated statements of operations, but will be presented gross upon adoption of the new guidance. While we are unable to quantify the impact at this time, we do not expect the adoption of this guidance to have a material impact on our consolidated statement of earnings and statement of cash flows. We will be required to adopt this standard in the first quarter of fiscal 2020 and plan to utilize the alternative transition method, whereby an entity records a cumulative adjustment to opening retained earnings in the year of adoption without restating prior periods. The new standard also provides a number of optional practical expedients in transition. We expect to elect the transition package of three practical expedients, which, among other items, permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We also expect to elect the short-term lease recognition exemption for all leases that qualify, permitting us to not apply the recognition requirements of this standard to leases with a term of 12 months or less. We also expect to elect the practical expedient to not separate lease and non-lease components for all of our leases. We do not expect to elect the use-of-hindsight practical expedient, and therefore expect to continue to utilize lease terms determined under the existing lease guidance. |
Basis Of Presentation (Tables)
Basis Of Presentation (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary Of Number Of Restaurants | The following table summarizes the number of restaurants as of the end of each period: July 7, July 8, Company-operated 137 146 Franchise 2,105 2,095 Total system 2,242 2,241 Refranchisings and franchisee development — The following table summarizes the number of restaurants sold to franchisees, the number of restaurants developed by franchisees, and gains recognized in each period ( dollars in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Restaurants sold to franchisees — 42 — 127 New restaurants opened by franchisees 5 — 16 8 Proceeds from the sale of company-operated restaurants: Cash (1) $ — $ 6,822 $ 133 $ 23,666 Notes receivable — 33,042 — 64,548 — 39,864 133 88,214 Net assets sold (primarily property and equipment) — (6,745 ) — (19,891 ) Lease commitment charges — — — (863 ) Goodwill related to the sale of company-operated restaurants — (566 ) (2 ) (4,526 ) Other (2) — (3,877 ) 88 (19,846 ) Gains on the sale of company-operated restaurants $ — $ 28,676 $ 219 $ 43,088 ____________________________ (1) The year-to-date amounts in 2019 and 2018 include additional proceeds of $0.1 million and $1.3 million , respectively, related to restaurants sold in prior years. (2) Amounts in 2018 are primarily related to an $8.8 million reduction of gains related to the modification of certain 2017 refranchising transactions. The quarter and year-to-date amounts in 2018 also include $2.9 million and $8.1 million , respectively, of costs related to franchise remodel incentives. |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | In May 2014, the FASB issued ASU 2014-09, Revenue Recognition - Revenue from Contracts with Customers (Topic 606) (“ASC 606”), which provides a comprehensive new revenue recognition model that requires an entity to recognize revenue in an amount that reflects the consideration the entity expects to receive for the transfer of promised goods or services to its customers. The standard also requires additional disclosure regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We adopted the new standard on October 1, 2018 using the modified retrospective method, whereby the cumulative effect of this transition to applicable contracts with customers that were not completed as of October 1, 2018 was recorded as an adjustment to beginning retained earnings as of this date. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The new revenue recognition standard did not impact our recognition of restaurant sales, rental revenues, or royalty fees from franchisees. The new pronouncement changed the way initial fees from franchisees for new restaurant openings or new franchise terms are recognized. Under the previous revenue recognition guidance, initial franchise fees were recognized as revenue at the time when a new restaurant opened or at the start of a new franchise term. In accordance with the new guidance, the initial franchise services are not distinct from the continuing rights and services offered during the term of the franchise agreement and will therefore be treated as a single performance obligation together with the continuing rights and services. As such, initial fees received will be recognized over the franchise term and any unamortized portion will be recorded as deferred revenue in our condensed consolidated balance sheet. An adjustment to opening retained earnings and a corresponding contract liability of approximately $50.3 million (of which $5.0 million was current and $45.3 million was long-term) was established on the date of adoption. A deferred tax asset of approximately $13.0 million related to this contract liability was also established on the date of adoption. The new standard also had an impact on transactions presented net and not included in our revenues and expenses such as franchisee contributions to and expenditures from our advertising fund, and sourcing and technology fee contributions from franchisees and the related expenses. We determined that we are the principal in these arrangements, and as such, contributions to and expenditures from the advertising fund, and sourcing and technology fees and expenditures are now reported on a gross basis within our consolidated statements of earnings. While this change materially impacted our gross amount of reported revenues and expenses, the impact will be largely offsetting with no material impact to our reported net earnings. However, any annual surplus or deficit in the marketing fund will impact income from operations and net income. The following table summarizes the impacts of adopting ASC 606 on the Company’s condensed consolidated financial statements as of and for the 12-weeks and 40-weeks ended July 7, 2019 (in thousands) : Adjustments As Reported Franchise Fees Marketing and Sourcing Fees Technology Support Fees Balances without Adoption Condensed Consolidated Statements of Earnings 12-Weeks Ended July 7, 2019 Franchise royalties and other $ 40,180 $ (918 ) $ — $ — $ 39,262 Franchise contributions for advertising and other services $ 40,386 $ — $ (38,133 ) $ (2,253 ) $ — Total revenues $ 222,359 $ (918 ) $ (38,133 ) $ (2,253 ) $ 181,055 Franchise advertising and other services expenses $ 41,882 $ — $ (38,133 ) $ (3,749 ) $ — Selling, general and administrative expenses $ 24,389 $ — $ — $ 1,496 $ 25,885 Total operating costs and expenses, net $ 174,098 $ — $ (38,133 ) $ (2,253 ) $ 133,712 Earnings from operations $ 48,261 $ (918 ) $ — $ — $ 47,343 Earnings from continuing operations and before income taxes $ 11,425 $ (918 ) $ — $ — $ 10,507 Income tax (benefit) expense $ (2,048 ) $ (237 ) $ — $ — $ (2,285 ) Earnings from continuing operations $ 13,473 $ (681 ) $ — $ — $ 12,792 Net earnings $ 13,189 $ (681 ) $ — $ — $ 12,508 40-Weeks Ended July 7, 2019 Franchise royalties and other $ 130,840 $ (2,983 ) $ — $ — $ 127,857 Franchise contributions for advertising and other services $ 131,189 $ — $ (124,187 ) $ (7,002 ) $ — Total revenues $ 728,872 $ (2,983 ) $ (124,187 ) $ (7,002 ) $ 594,700 Franchise advertising and other services expenses $ 136,397 $ — $ (124,187 ) $ (12,210 ) $ — Selling, general and administrative expenses $ 66,057 $ — $ — $ 5,208 $ 71,265 Total operating costs and expenses, net $ 575,164 $ — $ (124,187 ) $ (7,002 ) $ 443,975 Earnings from operations $ 153,708 $ (2,983 ) $ — $ — $ 150,725 Earnings from continuing operations and before income taxes $ 85,423 $ (2,983 ) $ — $ — $ 82,440 Income tax (benefit) expense $ 15,699 $ (769 ) $ — $ — $ 14,930 Earnings from continuing operations $ 69,724 $ (2,214 ) $ — $ — $ 67,510 Net earnings $ 72,376 $ (2,214 ) $ — $ — $ 70,162 Condensed Consolidated Balance Sheet July 7, 2019 Prepaid expenses $ 17,484 $ 769 $ — $ — $ 18,253 Total current assets $ 105,997 $ 769 $ — $ — $ 106,766 Deferred tax assets $ 72,903 $ (12,958 ) $ — $ — $ 59,945 Other assets, net $ 215,234 $ 269 $ — $ — $ 215,503 Total other assets $ 335,335 $ (12,689 ) $ — $ — $ 322,646 Total assets $ 831,270 $ (11,920 ) $ — $ — $ 819,350 Accrued liabilities $ 124,823 $ (4,968 ) $ — $ — $ 119,855 Total current liabilities $ 218,849 $ (4,968 ) $ — $ — $ 213,881 Other long-term liabilities $ 221,219 $ (42,067 ) $ — $ — $ 179,152 Total long-term liabilities $ 1,192,982 $ (42,067 ) $ — $ — $ 1,150,915 Retained earnings $ 1,565,287 $ 35,114 $ — $ — $ 1,600,401 Total stockholders’ deficit $ (580,561 ) $ 35,114 $ — $ — $ (545,447 ) Total liabilities and stockholders’ deficit $ 831,270 $ (11,921 ) $ — $ — $ 819,349 |
Revenue Disaggregation of Total
Revenue Disaggregation of Total Revenue (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Disaggregation of revenue — The following table disaggregates revenue by primary source for the 12-weeks and 40-weeks ended July 7, 2019 (in thousands) : Quarter Year-to-date Sources of revenue: Company restaurant sales $ 78,434 $ 257,948 Franchise rental revenues 63,359 208,895 Franchise royalties 38,752 125,407 Marketing fees 37,269 121,078 Technology and sourcing fees 3,117 10,111 Franchise fees and other services 1,428 5,433 Total revenue $ 222,359 $ 728,872 |
Revenue Changes in Contract Lia
Revenue Changes in Contract Liabilities (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Asset and Liability [Table Text Block] | A summary of significant changes in our contract liabilities between the date of adoption (October 1, 2018) and July 7, 2019 is presented below (in thousands) : Deferred Franchise Fees Deferred franchise fees at October 1, 2018 $ 50,018 Revenue recognized during the period (3,953 ) Additions during the period 970 Deferred franchise fees at July 7, 2019 $ 47,035 |
Revenue Estimated Future Franch
Revenue Estimated Future Franchise Fees (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block] | The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied at the end of the period (in thousands) : 2019 (1) $ 1,145 2020 4,878 2021 4,856 2022 4,656 2023 4,501 Thereafter 26,999 $ 47,035 ____________________________ (1) Represents the estimate for remainder of fiscal year 2019. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | DISCONTINUED OPERATIONS Qdoba — In December 2017, we entered into a stock purchase agreement (the “Qdoba Purchase Agreement”) with the Buyer to sell all issued and outstanding shares of Qdoba. The Buyer completed the acquisition of Qdoba on March 21, 2018 (the “Qdoba Sale”). We also entered into a Transition Services Agreement with the Buyer pursuant to which the Buyer is receiving certain services (the “Services”) to enable it to operate the Qdoba business after the closing of the Qdoba Sale. The Services include information technology, finance and accounting, human resources, supply chain and other corporate support services. Under the Agreement, the Services are being provided at cost for a period of up to 12 months, with two 3 -month extensions available for certain services. We are still providing accounting and information technology services under the Agreement and currently estimate these services will be performed up to, but no later than, September 21, 2019. In 2019 and 2018, we recorded $0.9 million and $3.6 million in the quarter, respectively, and $6.5 million and $4.7 million year-to-date, respectively, in income related to the Services as a reduction of selling, general and administrative expenses in the condensed consolidated statements of earnings. Further, in 2018, we entered into an Employee Agreement with the Buyer pursuant to which we continued to employ all Qdoba employees who work for the Buyer (the “Qdoba Employees”) from the date of closing of the Qdoba Sale through December 31, 2018. During the term of the Employee Agreement, we paid all wages and benefits of the Qdoba Employees and received reimbursement of these costs from the Buyer. From October 1, 2018 to December 31, 2018, we paid $35.4 million of Qdoba wages and benefits pursuant to the Employee Agreement. As the Qdoba Sale represents a strategic shift that had a major effect on our operations and financial results, in accordance with the provisions of FASB authoritative guidance on the presentation of financial statements, Qdoba results are classified as discontinued operations in our condensed consolidated statements of earnings and our condensed consolidated statements of cash flows for all periods presented. Income taxes — In fiscal 2019, the Company entered into a bilateral California election with Quidditch Acquisition, Inc. to retroactively treat the divestment of Qdoba Restaurant Corporation on March 21, 2018 as a sale of assets instead of a stock sale for income tax purposes. This election reduced the Company’s fiscal year 2018 California tax liability on the divestment by $2.8 million . The following table summarizes the Qdoba-related activity for each period in discontinued operations ( in thousands, except per share data ): Quarter Year-to-date July 7, July 8, July 7, July 8, Company restaurant sales $ — $ — $ — $ 192,620 Franchise revenues — — — 9,337 Company restaurant costs (excluding depreciation and amortization) — — — (166,122 ) Franchise costs (excluding depreciation and amortization) — — — (2,338 ) Selling, general and administrative expenses (120 ) (202 ) 123 (18,314 ) Depreciation and amortization — — — (5,012 ) Impairment and other charges, net (262 ) (123 ) (262 ) (2,386 ) Interest expense, net — — — (4,787 ) Operating (losses) earnings from discontinued operations before income taxes (382 ) (325 ) (139 ) 2,998 Gain (loss) on Qdoba Sale — (3,648 ) (85 ) 32,081 (Losses) earnings from discontinued operations before income taxes (382 ) (3,973 ) (224 ) 35,079 Income tax benefit (expense) 98 1,097 2,876 (15,927 ) (Losses) earnings from discontinued operations, net of income taxes $ (284 ) $ (2,876 ) $ 2,652 $ 19,152 Net earnings per share from discontinued operations: Basic $ (0.01 ) $ (0.10 ) $ 0.10 $ 0.66 Diluted $ (0.01 ) $ (0.10 ) $ 0.10 $ 0.65 Selling, general and administrative expenses presented in the table above include corporate costs directly in support of Qdoba operations, as well as resolutions of certain matters that existed prior to the Qdoba sale. All other corporate costs were classified in results of continuing operations. Our credit facility required us to make a mandatory prepayment (“Qdoba Prepayment”) on our term loan upon the closing of the Qdoba Sale, which was $260.0 million . In accordance with authoritative guidance on financial statement presentation, interest expense associated with our credit facility was allocated to discontinued operations in the prior year based on our estimate of the mandatory prepayment that was made upon closing of the Qdoba Sale. Lease guarantees — While all operating leases held in the name of Qdoba were part of the Qdoba Sale, some of the leases remain guaranteed by the Company pursuant to one or more written guarantees (the “Guarantees”). In the event Qdoba fails to meet its payment and performance obligations under such guaranteed leases, we may be required to make rent and other payments to the landlord under the requirements of the Guarantees. Should we, as guarantor of the lease obligations, be required to make any lease payments due for the remaining term of the subject lease(s) subsequent to March 21, 2018, the maximum amount we may be required to pay is approximately $33.8 million as of July 7, 2019. The lease terms extend for a maximum of approximately 16 more years as of July 7, 2019, and we would remain a guarantor of the leases in the event the leases are extended for any established renewal periods. In the event that we are obligated to make payments under the Guarantees, we believe the exposure is limited due to contractual protections and recourse available in the lease agreements, as well as the Qdoba Purchase Agreement, including a requirement of the landlord to mitigate damages by re-letting the properties in default, and indemnity from the Buyer. Qdoba continues to meet its obligations under these leases and there have not been any events that would indicate that Qdoba will not continue to meet the obligations of the leases. As such, we have not recorded a liability for the Guarantees as the likelihood of Qdoba defaulting on the assigned agreements was deemed to be less than probable. |
Disposal Groups, Including Discontinued Operations | The following table summarizes the Qdoba-related activity for each period in discontinued operations ( in thousands, except per share data ): Quarter Year-to-date July 7, July 8, July 7, July 8, Company restaurant sales $ — $ — $ — $ 192,620 Franchise revenues — — — 9,337 Company restaurant costs (excluding depreciation and amortization) — — — (166,122 ) Franchise costs (excluding depreciation and amortization) — — — (2,338 ) Selling, general and administrative expenses (120 ) (202 ) 123 (18,314 ) Depreciation and amortization — — — (5,012 ) Impairment and other charges, net (262 ) (123 ) (262 ) (2,386 ) Interest expense, net — — — (4,787 ) Operating (losses) earnings from discontinued operations before income taxes (382 ) (325 ) (139 ) 2,998 Gain (loss) on Qdoba Sale — (3,648 ) (85 ) 32,081 (Losses) earnings from discontinued operations before income taxes (382 ) (3,973 ) (224 ) 35,079 Income tax benefit (expense) 98 1,097 2,876 (15,927 ) (Losses) earnings from discontinued operations, net of income taxes $ (284 ) $ (2,876 ) $ 2,652 $ 19,152 Net earnings per share from discontinued operations: Basic $ (0.01 ) $ (0.10 ) $ 0.10 $ 0.66 Diluted $ (0.01 ) $ (0.10 ) $ 0.10 $ 0.65 |
Summary Of Refranchisings, Fr_2
Summary Of Refranchisings, Franchisee Development And Acquisitions (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Summary Of Refranchisings, Franchisee Development And Acquisitions [Abstract] | |
Number Of Restaurants Sold And Developed By Franchisees And Related Gains And Fees Recognized | The following table summarizes the number of restaurants as of the end of each period: July 7, July 8, Company-operated 137 146 Franchise 2,105 2,095 Total system 2,242 2,241 Refranchisings and franchisee development — The following table summarizes the number of restaurants sold to franchisees, the number of restaurants developed by franchisees, and gains recognized in each period ( dollars in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Restaurants sold to franchisees — 42 — 127 New restaurants opened by franchisees 5 — 16 8 Proceeds from the sale of company-operated restaurants: Cash (1) $ — $ 6,822 $ 133 $ 23,666 Notes receivable — 33,042 — 64,548 — 39,864 133 88,214 Net assets sold (primarily property and equipment) — (6,745 ) — (19,891 ) Lease commitment charges — — — (863 ) Goodwill related to the sale of company-operated restaurants — (566 ) (2 ) (4,526 ) Other (2) — (3,877 ) 88 (19,846 ) Gains on the sale of company-operated restaurants $ — $ 28,676 $ 219 $ 43,088 ____________________________ (1) The year-to-date amounts in 2019 and 2018 include additional proceeds of $0.1 million and $1.3 million , respectively, related to restaurants sold in prior years. (2) Amounts in 2018 are primarily related to an $8.8 million reduction of gains related to the modification of certain 2017 refranchising transactions. The quarter and year-to-date amounts in 2018 also include $2.9 million and $8.1 million , respectively, of costs related to franchise remodel incentives. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Fair Value Disclosures [Abstract] | |
Financial Assets And Liabilities Measured At Fair Value On Recurring Basis | The following table presents our financial assets and liabilities measured at fair value on a recurring basis ( in thousands ): Total Quoted Prices in Active Markets for Identical Assets (3) (Level 1) Significant Other Observable Inputs (3) (Level 2) Significant Unobservable Inputs (3) (Level 3) Fair value measurements as of July 7, 2019: Non-qualified deferred compensation plan (1) $ 31,012 $ 31,012 $ — $ — Total liabilities at fair value $ 31,012 $ 31,012 $ — $ — Fair value measurements as of September 30, 2018: Non-qualified deferred compensation plan (1) $ 37,447 $ 37,447 $ — $ — Interest rate swaps (Note 7) (2) 703 — 703 — Total liabilities at fair value $ 38,150 $ 37,447 $ 703 $ — ____________________________ (1) We maintain an unfunded defined contribution plan for key executives and other members of management. The fair value of this obligation is based on the closing market prices of the participants’ elected investments. The obligation is included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets. (2) We entered into interest rate swaps to reduce our exposure to rising interest rates on our variable rate debt. The fair values of our interest rate swaps are based upon Level 2 inputs which include valuation models as reported by our counterparties. These valuation models use a discounted cash flow analysis on the cash flows of each derivative. The key inputs for the valuation models are quoted market prices, discount rates, and forward yield curves. The Company also considers its own nonperformance risk and the respective counter-party’s nonperformance risk in the fair value measurements. As further described in Note 7, Derivatives , the Company’s interest rate swaps were terminated on July 2, 2019 and settled in connection with our refinancing transaction on July 8, 2019. (3) |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Derivative Instruments and Hedges, Assets [Abstract] | |
Derivative Instruments Outstanding | The following derivative instruments were outstanding as of the end of each period ( in thousands ): Balance Sheet Location Fair Value July 7, September 30, 2018 Derivatives designated as hedging instruments: Interest rate swaps Accrued liabilities $ — $ (26 ) Interest rate swaps Other long-term liabilities — (1,266 ) Interest rate swaps Other assets, net — 589 Total derivatives $ — $ (703 ) |
Gains Or Losses Recognized On Interest Rate Swap Derivative Instruments | The following table summarizes the OCI activity related to our interest rate swap derivative instruments and the amounts reclassified from accumulated OCI ( in thousands ): Location in Income Quarter Year-to-date July 7, July 8, July 7, July 8, (Loss) gain recognized in OCI N/A $ (11,499 ) $ 1,494 $ (23,625 ) $ 16,080 Loss reclassified from accumulated OCI into net earnings Interest expense, net $ 23,715 $ 539 $ 24,328 $ 3,089 |
Impairment and other charges,_2
Impairment and other charges, net (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Restructuring Cost and Reserve [Line Items] | |
Impairment Disposition Of Property And Equipment, Restaurant Closing Costs And Resturcturing | Impairment and other charges, net in the accompanying condensed consolidated statements of earnings is comprised of the following ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Restructuring costs $ (64 ) $ 1,872 $ 6,722 $ 4,805 Costs of closed restaurants and other 2,010 378 3,259 3,483 Accelerated depreciation 416 538 1,342 912 (Gains) losses on disposition of property and equipment, net (1) (5,618 ) 477 (5,756 ) 958 Operating restaurant impairment charges (2) — — — 291 $ (3,256 ) $ 3,265 $ 5,567 $ 10,449 ____________________________ (1) In 2019, includes a $0.8 million gain recognized in the second quarter related to an eminent domain transaction and a $5.7 million gain related to a sale of property recognized in the third quarter. (2) In 2018, impairment charges relate to our landlord’s sale of a restaurant property to a franchisee. |
Restructuring and Related Costs | The following is a summary of our restructuring costs (in thousands) : Quarter Year-to-date July 7, July 8, July 7, July 8, Employee severance and related costs $ 287 $ 1,476 $ 5,436 $ 2,828 Strategic Alternatives Evaluation (1) (351 ) 376 1,286 1,188 Qdoba Evaluation (2) — 20 — 788 Other — — — 1 $ (64 ) $ 1,872 $ 6,722 $ 4,805 ____________________________ (1) Strategic Alternative Evaluation costs are primarily related to third party advisory services. (2) Qdoba Evaluation costs are primarily related to retention compensation and third party advisory services. |
Schedule of Restructuring Reserve by Type of Cost | Total accrued severance costs related to our restructuring activities are included in “Accrued liabilities” on our condensed consolidated balance sheets, and changed as follows during 2019 (in thousands) : Balance as of September 30, 2018 $ 5,309 Costs incurred 5,946 Accruals released (605 ) Cash payments (8,167 ) Balance as of July 7, 2019 $ 2,483 |
Impairment, Disposition, Closing Costs, and Restructuring [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Schedule of Restructuring Reserve by Type of Cost | The liability for lease termination costs related to closed restaurants, included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets, changed as follows during 2019 ( in thousands ): Balance as of September 30, 2018 $ 3,534 Additions — Adjustments (1) 572 Interest expense 1,094 Cash payments (3,156 ) Balance as of July 7, 2019 (2) (3) $ 2,044 ___________________________ (1) Adjustments relate primarily to revisions of certain sublease and cost assumptions. Our estimates related to our future lease obligations, primarily the sublease income we anticipate, are subject to a high degree of judgment and may differ from actual sublease income due to changes in economic conditions, desirability of the sites and other factors. (2) The weighted average remaining lease term related to these commitments is approximately 4 years. (3) This balance excludes $1.7 million of restaurant closing costs that are included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets, which were initially recorded as losses on the sale of company-operated restaurants to franchisees. |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The following is a summary of the components of each tax rate (dollars in thousands) : Quarter Year-to-date July 7, July 8, July 7, July 8, Income tax expense at statutory rate $ 2,948 25.8 % $ 18,715 28.6 % $ 22,040 25.8 % $ 46,752 28.9 % One-time, non-cash impact of the Tax Act — — % 878 1.3 % — — % 32,082 19.8 % Termination of interest rate swaps (2,984 ) (26.1 )% — — % (2,984 ) (3.5 )% — — % Release of valuation reserve on state tax losses and credits (873 ) (7.6 )% (1,312 ) (2.0 )% (1,023 ) (1.2 )% (1,312 ) (0.8 )% Release of federal tax liability (817 ) (7.2 )% — — % (817 ) (1.0 )% — — % Stock compensation excess tax expense (18 ) (0.2 )% (1,268 ) (1.9 )% (66 ) (0.1 )% (2,084 ) (1.3 )% Adjustment to state tax provision — — % — — % (1,027 ) (1.2 )% — — % Other (304 ) (2.6 )% 321 0.5 % (424 ) (0.4 )% 460 0.3 % (1) $ (2,048 ) (17.9 )% $ 17,334 26.5 % $ 15,699 18.4 % $ 75,898 46.9 % ____________________________ (1) Percentages may not add due to rounding. |
Retirement Plans (Tables)
Retirement Plans (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract] | |
Components Of Net Periodic Benefit Cost | The components of net periodic benefit cost in each period were as follows ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Defined benefit pension plans: Interest cost $ 5,286 $ 5,159 $ 17,619 $ 17,198 Service cost — 114 — 379 Expected return on plan assets (1) (6,077 ) (6,108 ) (20,257 ) (20,360 ) Actuarial loss (2) 914 1,124 3,046 3,745 Amortization of unrecognized prior service costs (2) 27 34 89 113 Net periodic benefit cost $ 150 $ 323 $ 497 $ 1,075 Postretirement healthcare plans: Interest cost $ 229 $ 220 $ 766 $ 734 Actuarial gain (2) (37 ) (6 ) (122 ) (20 ) Net periodic benefit cost $ 192 $ 214 $ 644 $ 714 ___________________________ (1) Determined as of the beginning of the year based on a return on asset assumption of 6.2% . (2) |
Schedule Of Defined Benefit Plan Contribution | Future cash flows — Our policy is to fund our plans at or above the minimum required by law. As of January 1, 2018 , the date of our last actuarial funding valuation, there was no minimum contribution funding requirement. Details regarding 2019 contributions are as follows ( in thousands ): SERP Postretirement Healthcare Plans Net year-to-date contributions $ 4,213 $ 913 Remaining estimated net contributions during fiscal 2019 $ 800 $ 500 |
Stockholders' Equity Summary of
Stockholders' Equity Summary of Changes in Equity (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stockholders Equity | Summary of changes in stockholders’ deficit — A reconciliation of the beginning and ending amounts of stockholders’ deficit is presented below ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Balance at beginning of period $ (592,514 ) $ (430,910 ) $ (591,699 ) $ (388,130 ) Shares issued under stock plans, including tax benefit 453 2,325 696 2,364 Share-based compensation 1,881 1,684 6,589 7,950 Dividends declared (10,326 ) (11,252 ) (30,967 ) (34,698 ) Purchases of treasury stock — (100,000 ) — (200,000 ) Net earnings 13,189 45,307 72,376 105,102 Other comprehensive income, net of taxes 6,756 2,376 (226 ) 17,093 Cumulative-effect from a change in accounting principle — — (37,330 ) (151 ) Balance at end of period $ (580,561 ) $ (490,470 ) $ (580,561 ) $ (490,470 ) |
Average Shares Outstanding (Tab
Average Shares Outstanding (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | |
Reconciliation Of Basic Weighted-Average Shares Outstanding To Diluted Weighted-Average Shares Outstanding | The following table reconciles basic weighted-average shares outstanding to diluted weighted-average shares outstanding ( in thousands ): Quarter Year-to-date July 7, July 8, July 7, July 8, Weighted-average shares outstanding – basic 25,958 28,042 25,933 28,989 Effect of potentially dilutive securities: Nonvested stock awards and units 206 215 205 241 Stock options 10 32 10 47 Performance share awards 2 7 2 7 Weighted-average shares outstanding – diluted 26,176 28,296 26,150 29,284 Excluded from diluted weighted-average shares outstanding: Antidilutive 186 192 186 139 Performance conditions not satisfied at the end of the period 89 67 89 67 |
Supplemental Consolidated Cas_2
Supplemental Consolidated Cash Flow Information (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Supplemental Cash Flow Information [Abstract] | |
Additional Information Related To Cash Flows | Year-to-date July 7, July 8, Non-cash investing and financing transactions: Decrease in obligations for treasury stock repurchases $ 14,362 $ — Decrease in obligations for purchases of property and equipment $ 5,421 $ 2,456 Increase in dividends accrued or converted to common stock equivalents $ 184 $ 218 Decrease in capital lease obligations from the termination of equipment and building leases $ 41 $ 3,654 Increase in notes receivable from the sale of company-operated restaurants $ — $ 31,160 Equipment capital lease obligations incurred $ — $ 78 |
Supplemental Consolidated Bal_2
Supplemental Consolidated Balance Sheet Information (Tables) | 9 Months Ended |
Jul. 07, 2019 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule Of Supplemental Consolidated Balance Sheet Information | SUPPLEMENTAL CONSOLIDATED BALANCE SHEET INFORMATION (in thousands) July 7, September 30, Accounts and other receivables, net: Trade $ 44,403 $ 35,877 Notes receivable 1,854 11,480 Due from marketing fund 839 — Income tax receivable 184 5,637 Other 12,059 6,123 Allowance for doubtful accounts (1,692 ) (1,695 ) $ 57,647 $ 57,422 Prepaid expenses: Prepaid rent $ 11,977 $ — Prepaid income taxes — 4,837 Prepaid advertising 28 4,318 Other 5,479 5,288 $ 17,484 $ 14,443 Other assets, net: Company-owned life insurance policies $ 113,025 $ 109,908 Deferred rent receivable 49,204 48,372 Franchise tenant improvement allowance 24,328 22,506 Other 28,677 18,480 $ 215,234 $ 199,266 Accrued liabilities: Insurance $ 30,206 $ 35,405 Payroll and related taxes 24,807 29,498 Deferred franchise fees 4,968 375 Deferred rent income 16,960 1,387 Sales and property taxes 4,097 4,555 Gift card liability 2,109 2,081 Other 41,676 33,621 $ 124,823 $ 106,922 Other long-term liabilities: Defined benefit pension plans $ 66,185 $ 69,012 Deferred franchise fees 42,063 — Straight-line rent accrual 29,700 31,762 Other 83,271 92,675 $ 221,219 $ 193,449 |
Basis Of Presentation (Details)
Basis Of Presentation (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 07, 2019USD ($)restaurant | Jul. 08, 2018USD ($)restaurant | Jul. 07, 2019USD ($)segmentrestaurant | Jul. 08, 2018USD ($)restaurant | Sep. 30, 2018USD ($) | |
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | restaurant | 2,242 | 2,241 | 2,242 | 2,241 | |
Number of reporting segments | segment | 1 | ||||
Contractual obligation | 5.00% | ||||
Incremental Corporate Advertising Contributions | $ 2,000 | $ 3,300 | |||
Marketing and advertising expense | $ 4,000 | $ 5,900 | 15,000 | 22,000 | |
Deferred tax assets | (72,903) | (72,903) | $ (62,140) | ||
Pension Cost Reclassification | $ 342 | $ 423 | $ 1,141 | $ 1,410 | |
Entity Operated Units | |||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | restaurant | 137 | 146 | 137 | 146 | |
Franchised Units | |||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Number of restaurants | restaurant | 2,105 | 2,095 | 2,105 | 2,095 | |
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | Franchise Fees [Member] | |||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 50,300 | $ 50,300 | |||
Contract with Customer, Liability, Current | 4,968 | 4,968 | |||
Contract liabilities noncurrent | 45,300 | 45,300 | |||
Deferred tax assets | $ 12,958 | $ 12,958 |
Basis Of Presentation - Adoptio
Basis Of Presentation - Adoption for Topic 606 Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | Apr. 14, 2019 | Sep. 30, 2018 | Apr. 15, 2018 | Oct. 01, 2017 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | $ 222,359 | $ 187,983 | $ 728,872 | $ 692,218 | |||||
Selling, General and Administrative Expense | 24,389 | 19,671 | 66,057 | 80,326 | |||||
Total operating costs and expenses, net | 174,098 | 111,220 | 575,164 | 494,841 | |||||
Earnings from operations | 48,261 | 76,763 | 153,708 | 197,377 | |||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 11,425 | 65,467 | 85,423 | 161,901 | |||||
Income tax (benefit) expense | [1] | (2,048) | 17,334 | 15,699 | 75,898 | ||||
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent | 13,473 | 48,133 | 69,724 | 86,003 | |||||
Net earnings | 13,189 | 45,307 | 72,376 | 105,102 | |||||
Prepaid expenses | 17,484 | 17,484 | $ 14,443 | ||||||
Total current assets | 105,997 | 105,997 | 94,973 | ||||||
Deferred tax assets | 72,903 | 72,903 | 62,140 | ||||||
Other Assets, Noncurrent | 215,234 | 215,234 | 199,266 | ||||||
Assets, Noncurrent | 335,335 | 335,335 | 308,755 | ||||||
Assets | 831,270 | 831,270 | 823,397 | ||||||
Accrued Liabilities, Current | 124,823 | 124,823 | 106,922 | ||||||
Liabilities, Current | 218,849 | 218,849 | 183,720 | ||||||
Other long-term liabilities | 221,219 | 221,219 | 193,449 | ||||||
Liabilities, Noncurrent | 1,192,982 | 1,192,982 | 1,231,376 | ||||||
Retained Earnings (Accumulated Deficit) | 1,565,287 | 1,565,287 | 1,561,353 | ||||||
Stockholders' Equity Attributable to Parent | (580,561) | (490,470) | (580,561) | (490,470) | $ (592,514) | (591,699) | $ (430,910) | $ (388,130) | |
Liabilities and Equity | 831,270 | 831,270 | $ 823,397 | ||||||
Royalty and Other | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 40,180 | 38,787 | 130,840 | 124,387 | |||||
Franchise contributions for advertising and other services [Domain] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 40,386 | 0 | 131,189 | 0 | |||||
Franchise [Member] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Franchise advertising and other services expenses | 41,882 | $ 0 | 136,397 | $ 0 | |||||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 181,055 | 594,700 | |||||||
Franchise advertising and other services expenses | 0 | 0 | |||||||
Selling, General and Administrative Expense | 25,885 | 71,265 | |||||||
Total operating costs and expenses, net | 133,712 | 443,975 | |||||||
Earnings from operations | 47,343 | 150,725 | |||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 10,507 | 82,440 | |||||||
Income tax (benefit) expense | (2,285) | 14,930 | |||||||
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent | 12,792 | 67,510 | |||||||
Net earnings | 12,508 | 70,162 | |||||||
Prepaid expenses | 18,253 | 18,253 | |||||||
Total current assets | 106,766 | 106,766 | |||||||
Deferred tax assets | 59,945 | 59,945 | |||||||
Other Assets, Noncurrent | 215,503 | 215,503 | |||||||
Assets, Noncurrent | 322,646 | 322,646 | |||||||
Assets | 819,350 | 819,350 | |||||||
Accrued Liabilities, Current | 119,855 | 119,855 | |||||||
Liabilities, Current | 213,881 | 213,881 | |||||||
Other long-term liabilities | 179,152 | 179,152 | |||||||
Liabilities, Noncurrent | 1,150,915 | 1,150,915 | |||||||
Retained Earnings (Accumulated Deficit) | 1,600,401 | 1,600,401 | |||||||
Stockholders' Equity Attributable to Parent | (545,447) | (545,447) | |||||||
Liabilities and Equity | 819,349 | 819,349 | |||||||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Royalty and Other | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 39,262 | 127,857 | |||||||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Franchise contributions for advertising and other services [Domain] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 0 | 0 | |||||||
Franchise Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | (918) | (2,983) | |||||||
Franchise advertising and other services expenses | 0 | 0 | |||||||
Selling, General and Administrative Expense | 0 | 0 | |||||||
Total operating costs and expenses, net | 0 | 0 | |||||||
Earnings from operations | (918) | (2,983) | |||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | (918) | (2,983) | |||||||
Income tax (benefit) expense | (237) | (769) | |||||||
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent | (681) | (2,214) | |||||||
Net earnings | (681) | (2,214) | |||||||
Prepaid expenses | 769 | 769 | |||||||
Total current assets | 769 | 769 | |||||||
Deferred tax assets | (12,958) | (12,958) | |||||||
Other Assets, Noncurrent | 269 | 269 | |||||||
Assets, Noncurrent | (12,689) | (12,689) | |||||||
Assets | (11,920) | (11,920) | |||||||
Contract with Customer, Liability, Current | (4,968) | (4,968) | |||||||
Liabilities, Current | (4,968) | (4,968) | |||||||
Other long-term liabilities | (42,067) | (42,067) | |||||||
Liabilities, Noncurrent | (42,067) | (42,067) | |||||||
Retained Earnings (Accumulated Deficit) | 35,114 | 35,114 | |||||||
Stockholders' Equity Attributable to Parent | 35,114 | 35,114 | |||||||
Liabilities and Equity | (11,921) | (11,921) | |||||||
Franchise Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Royalty and Other | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | (918) | (2,983) | |||||||
Franchise Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Franchise contributions for advertising and other services [Domain] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 0 | 0 | |||||||
Marketing And Sourcing Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | (38,133) | (124,187) | |||||||
Franchise advertising and other services expenses | (38,133) | (124,187) | |||||||
Selling, General and Administrative Expense | 0 | 0 | |||||||
Total operating costs and expenses, net | (38,133) | (124,187) | |||||||
Earnings from operations | 0 | 0 | |||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 0 | 0 | |||||||
Income tax (benefit) expense | 0 | 0 | |||||||
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent | 0 | 0 | |||||||
Net earnings | 0 | 0 | |||||||
Prepaid expenses | 0 | 0 | |||||||
Total current assets | 0 | 0 | |||||||
Deferred tax assets | 0 | 0 | |||||||
Other Assets, Noncurrent | 0 | 0 | |||||||
Assets, Noncurrent | 0 | 0 | |||||||
Assets | 0 | 0 | |||||||
Accrued Liabilities, Current | 0 | 0 | |||||||
Liabilities, Current | 0 | 0 | |||||||
Other long-term liabilities | 0 | 0 | |||||||
Liabilities, Noncurrent | 0 | 0 | |||||||
Retained Earnings (Accumulated Deficit) | 0 | 0 | |||||||
Stockholders' Equity Attributable to Parent | 0 | 0 | |||||||
Liabilities and Equity | 0 | 0 | |||||||
Marketing And Sourcing Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Royalty and Other | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 0 | 0 | |||||||
Marketing And Sourcing Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Franchise contributions for advertising and other services [Domain] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | (38,133) | (124,187) | |||||||
Technology And Support Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | (2,253) | (7,002) | |||||||
Franchise advertising and other services expenses | (3,749) | (12,210) | |||||||
Selling, General and Administrative Expense | 1,496 | 5,208 | |||||||
Total operating costs and expenses, net | (2,253) | (7,002) | |||||||
Earnings from operations | 0 | 0 | |||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 0 | 0 | |||||||
Income tax (benefit) expense | 0 | 0 | |||||||
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent | 0 | 0 | |||||||
Net earnings | 0 | 0 | |||||||
Prepaid expenses | 0 | 0 | |||||||
Total current assets | 0 | 0 | |||||||
Deferred tax assets | 0 | 0 | |||||||
Other Assets, Noncurrent | 0 | 0 | |||||||
Assets, Noncurrent | 0 | 0 | |||||||
Assets | 0 | 0 | |||||||
Accrued Liabilities, Current | 0 | 0 | |||||||
Liabilities, Current | 0 | 0 | |||||||
Other long-term liabilities | 0 | 0 | |||||||
Liabilities, Noncurrent | 0 | 0 | |||||||
Retained Earnings (Accumulated Deficit) | 0 | 0 | |||||||
Stockholders' Equity Attributable to Parent | 0 | 0 | |||||||
Liabilities and Equity | 0 | 0 | |||||||
Technology And Support Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Royalty and Other | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | 0 | 0 | |||||||
Technology And Support Fees [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Franchise contributions for advertising and other services [Domain] | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Revenues | $ (2,253) | $ (7,002) | |||||||
[1] | Percentages may not add due to rounding. |
Revenue Disaggregation of Reven
Revenue Disaggregation of Revenue (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Initial franchise fee | $ 50,000 | |||
Royalty and marketing fee, percent of gross sales | 5.00% | |||
Revenues | $ 222,359,000 | $ 187,983,000 | $ 728,872,000 | $ 692,218,000 |
Restaurant Sales [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 78,434,000 | 87,574,000 | 257,948,000 | 371,149,000 |
Franchise [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Franchise rental revenues | 63,359,000 | $ 61,622,000 | 208,895,000 | $ 196,682,000 |
Royalty [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 38,752,000 | 125,407,000 | ||
Advertising [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 37,269,000 | 121,078,000 | ||
Technology Service [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 3,117,000 | 10,111,000 | ||
Franchise Fees [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 1,428,000 | $ 5,433,000 |
Revenue Changes in Contract L_2
Revenue Changes in Contract Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 07, 2019 | Oct. 01, 2018 | |
Changes in Contract Liabilities [Abstract] | ||
Deferred Revenue | $ 47,035 | $ 50,018 |
Deferred Revenue, Revenue Recognized | (3,953) | |
Deferred Revenue, Additions | $ 970 |
Revenue Estimated Future Fran_2
Revenue Estimated Future Franchise Fees (Details) $ in Thousands | Jul. 07, 2019USD ($) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-09-29 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 1,145 | [1] |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-09-29 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 4,878 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-09-29 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 4,856 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-09-29 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 4,656 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-09-29 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 4,501 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-09-28 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 26,999 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-09-28 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 47,035 | |
[1] | Represents the estimate for remainder of fiscal year 2019. |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jul. 07, 2019USD ($) | Jul. 08, 2018USD ($) | Jul. 07, 2019USD ($)extnsion_option | Jul. 08, 2018USD ($) | Sep. 30, 2018USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Discontinued Operation, Period of Continuing Involvement after Disposal | 12 months | ||||
Discontinued Operation, Period Of Continuing Involvement After Disposal, Number Of Extension Options | extnsion_option | 2 | ||||
Discontinued Operation, Period Of Continuing Involvement After Disposal, Service Period Extension Option | 3 months | ||||
Other Nonrecurring Income | $ 0.9 | $ 3.6 | $ 6.5 | $ 4.7 | |
Other Nonrecurring Expense | 35.4 | ||||
Disposal Group, Including Discontinued Operation, Accrued Income Tax Payable | 2.8 | 2.8 | |||
Lease Guarantee | $ 33.8 | $ 33.8 | |||
Term Loan [Member] | Qdoba | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Repayments of Debt | $ 260 |
Discontinued Operations - Quart
Discontinued Operations - Quarterly Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Basic (in usd per share) | $ (0.01) | $ (0.10) | $ 0.10 | $ 0.66 |
Diluted (in usd per share) | $ (0.01) | $ (0.10) | $ 0.10 | $ 0.65 |
Qdoba | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Company restaurant sales | $ 0 | $ 0 | $ 0 | $ 192,620 |
Franchise revenues | 0 | 0 | 0 | 9,337 |
Company restaurant costs (excluding depreciation and amortization) | 0 | 0 | 0 | (166,122) |
Franchise costs (excluding depreciation and amortization) | 0 | 0 | 0 | (2,338) |
Selling, general and administrative expenses | (120) | (202) | 123 | (18,314) |
Depreciation and amortization expenses | 0 | 0 | 0 | (5,012) |
Impairment and other charges, net | (262) | (123) | (262) | (2,386) |
Interest expense, net | 0 | 0 | 0 | (4,787) |
Operating (losses) earnings from discontinued operations before income taxes | (382) | (325) | (139) | 2,998 |
Gain (loss) on Qdoba Sale | 0 | (3,648) | (85) | 32,081 |
(Losses) earnings from discontinued operations before income taxes | (382) | (3,973) | (224) | 35,079 |
Income taxes | 98 | 1,097 | 2,876 | (15,927) |
(Losses) earnings from discontinued operations, net of income taxes | $ (284) | $ (2,876) | $ 2,652 | $ 19,152 |
Basic (in usd per share) | $ (0.01) | $ (0.10) | $ 0.10 | $ 0.66 |
Diluted (in usd per share) | $ (0.01) | $ (0.10) | $ 0.10 | $ 0.65 |
Indebtedness (Details)
Indebtedness (Details) - USD ($) $ in Millions | Jul. 07, 2019 | May 01, 2019 |
Debt Disclosure [Abstract] | ||
Fees paid to third parties | $ 1.3 | |
Term note | $ 304.4 | |
Revolving credit facility | 707.4 | |
Letters of credit outstanding | 29.9 | |
Unused borrowing capacity | $ 162.7 |
Summary Of Refranchisings, Fr_3
Summary Of Refranchisings, Franchisee Development And Acquisitions (Number Of Restaurants Sold And Developed By Franchisees And Related Gains And Fees Recognized) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Jul. 07, 2019USD ($)restaurant | Jul. 08, 2018USD ($)restaurant | Jul. 07, 2019USD ($)restaurant | Jul. 08, 2018USD ($)restaurant | |||
Summary Of Refranchisings, Franchisee Development And Acquisitions [Line Items] | ||||||
Restaurants sold to franchisees | restaurant | 0 | 42 | 0 | 127 | ||
New restaurants opened by franchisees | restaurant | 5 | 0 | 16 | 8 | ||
Cash (1) | [1] | $ 0 | $ 6,822 | $ 23,666 | ||
Total Proceeds from the Sale of Company-Operated Restaurants | 0 | 39,864 | $ 133 | [1] | 88,214 | |
Net assets sold (primarily property and equipment) | 0 | (6,745) | 0 | (19,891) | ||
Lease commitment charges | 0 | 0 | 0 | (863) | ||
Goodwill related to the sale of company-operated restaurants | 0 | (566) | (2) | (4,526) | ||
Other (2) | [2] | 0 | (3,877) | 88 | (19,846) | |
Gains on the sale of company-operated restaurants | 0 | 28,676 | 219 | 43,088 | ||
Additional proceeds from the sale of a company-operated restaurant | 100 | 1,300 | ||||
Disposal Group Not Discontinued Operation Other Gain Loss On Disposal related to PY | 8,800 | |||||
Notes Receivable [Member] | ||||||
Summary Of Refranchisings, Franchisee Development And Acquisitions [Line Items] | ||||||
Notes receivable | $ 0 | 33,042 | $ 0 | 64,548 | ||
Remodel Credit [Member] | ||||||
Summary Of Refranchisings, Franchisee Development And Acquisitions [Line Items] | ||||||
Gains on the sale of company-operated restaurants | $ 2,900 | $ 8,100 | ||||
[1] | The year-to-date amounts in 2019 and 2018 include additional proceeds of $0.1 million and $1.3 million , respectively, related to restaurants sold in prior years. | |||||
[2] | Amounts in 2018 are primarily related to an $8.8 million reduction of gains related to the modification of certain 2017 refranchising transactions. The quarter and year-to-date amounts in 2018 also include $2.9 million and $8.1 million , respectively, of costs related to franchise remodel incentives. |
Fair Value Measurements (Financ
Fair Value Measurements (Financial Assets And Liabilities Measured At Fair Value On Recurring Basis) (Details) - USD ($) $ in Thousands | Jul. 07, 2019 | Sep. 30, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | $ 31,012 | $ 38,150 | |
Quoted Prices In Active Markets For Identical Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [1] | 31,012 | 37,447 |
Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [1] | 0 | 703 |
Fair Value, Inputs, Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | 0 | 0 | |
Interest Rate Swaps | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [2] | 703 | |
Interest Rate Swaps | Quoted Prices In Active Markets For Identical Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | 0 | ||
Interest Rate Swaps | Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [1],[2] | 703 | |
Interest Rate Swaps | Fair Value, Inputs, Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | 0 | ||
Non Qualified Deferred Compensation Plan | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [3] | 31,012 | 37,447 |
Non Qualified Deferred Compensation Plan | Quoted Prices In Active Markets For Identical Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | [1],[3] | 31,012 | 37,447 |
Non Qualified Deferred Compensation Plan | Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | 0 | 0 | |
Non Qualified Deferred Compensation Plan | Fair Value, Inputs, Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total liabilities at fair value | $ 0 | $ 0 | |
[1] | We did not have any transfers in or out of Level 1, 2 or 3. | ||
[2] | We entered into interest rate swaps to reduce our exposure to rising interest rates on our variable rate debt. The fair values of our interest rate swaps are based upon Level 2 inputs which include valuation models as reported by our counterparties. These valuation models use a discounted cash flow analysis on the cash flows of each derivative. The key inputs for the valuation models are quoted market prices, discount rates, and forward yield curves. The Company also considers its own nonperformance risk and the respective counter-party’s nonperformance risk in the fair value measurements. As further described in Note 7, Derivatives , the Company’s interest rate swaps were terminated on July 2, 2019 and settled in connection with our refinancing transaction on July 8, 2019. | ||
[3] | We maintain an unfunded defined contribution plan for key executives and other members of management. The fair value of this obligation is based on the closing market prices of the participants’ elected investments. The obligation is included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets. |
Derivative Instruments (Narrati
Derivative Instruments (Narrative) (Details) - USD ($) $ in Millions | Jul. 08, 2019 | Jun. 30, 2015 |
Interest Rate Swap 1 | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | $ 500 | |
Subsequent Event | Interest Rate Swaps | ||
Derivative [Line Items] | ||
Payments to terminate derivative contract | $ 23.6 |
Derivative Instruments (Derivat
Derivative Instruments (Derivative Instruments Outstanding) (Details) - Designated as Hedging Instrument - Interest Rate Swaps - USD ($) $ in Thousands | Jul. 07, 2019 | Sep. 30, 2018 |
Derivatives, Fair Value [Line Items] | ||
Total liabilities at fair value | $ 0 | $ 703 |
Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total liabilities at fair value | 0 | 26 |
Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total liabilities at fair value | 0 | 1,266 |
Other assets, net | ||
Derivatives, Fair Value [Line Items] | ||
Total assets at fair value | $ 0 | $ (589) |
Derivative Instruments (Gains O
Derivative Instruments (Gains Or Losses Recognized On Interest Rate Swap Derivative Instruments) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Loss) gain recognized in OCI | $ 1,494 | $ 16,080 | ||
Loss reclassified from accumulated OCI into net earnings | 539 | 3,089 | ||
Interest Rate Swaps | Derivatives Designated As Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Loss) gain recognized in OCI | $ (11,499) | 1,494 | $ (23,625) | 16,080 |
Interest Rate Swaps | Interest Expense, Net | Derivatives Designated As Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Loss reclassified from accumulated OCI into net earnings | $ 23,715 | $ 539 | $ 24,328 | $ 3,089 |
Impairment and other charges,_3
Impairment and other charges, net Impairment and other charges, net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Impairment, Disposition of Property and Equipment, and Restaurant Closing Costs [Line Items] | ||||
Restructuring costs | $ (64) | $ 1,872 | $ 6,722 | $ 4,805 |
Costs of closed restaurants and other | 2,010 | 378 | 3,259 | 3,483 |
Accelerated depreciation | 416 | 538 | 1,342 | 912 |
(Gains) losses on the disposition of property and equipment, net | 5,756 | (958) | ||
Operating restaurant impairment charges (2) | 0 | 0 | 0 | 291 |
Impairment And Other Costs Net | (3,256) | 3,265 | 5,567 | 10,449 |
Continuing Operations [Member] | ||||
Impairment, Disposition of Property and Equipment, and Restaurant Closing Costs [Line Items] | ||||
(Gains) losses on the disposition of property and equipment, net | $ (5,618) | $ 477 | (5,756) | $ 958 |
Gain from eminent domain transaction | 800 | |||
Gain related to sale of property | $ 5,700 |
Impairment and other charges,_4
Impairment and other charges, net Restructuring cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | ||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Costs | $ (64) | $ 1,872 | $ 6,722 | $ 4,805 | |
Restructuring and Related Cost, Expected Cost Remaining | 200 | 200 | |||
Employee Severance [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Costs | 287 | 1,476 | 5,436 | 2,828 | |
Strategic Alternative Evaluation [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Costs | [1] | (351) | 376 | 1,286 | 1,188 |
Qdoba evaluation cost [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Costs | [2] | 0 | 20 | 0 | 788 |
Other Restructuring [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Costs | $ 0 | $ 0 | $ 0 | $ 1 | |
[1] | Strategic Alternative Evaluation costs are primarily related to third party advisory services. | ||||
[2] | Qdoba Evaluation costs are primarily related to retention compensation and third party advisory services. |
Impairment and other charges,_5
Impairment and other charges, net Accrued severance (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Restructuring Reserve [Roll Forward] | ||||
Restructuring Costs | $ (64) | $ 1,872 | $ 6,722 | $ 4,805 |
Employee Severance [Member] | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Reserve | 5,309 | |||
Restructuring Costs | 287 | $ 1,476 | 5,436 | $ 2,828 |
Accruals released | (605) | |||
Payments for Restructuring | (8,167) | |||
Restructuring Reserve | $ 2,483 | 2,483 | ||
Employee Severance & Other [Domain] | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Costs | $ 5,946 |
Impairment and other charges,_6
Impairment and other charges, net Cost of closed restaurants (Details) $ in Thousands | 9 Months Ended | |
Jul. 07, 2019USD ($) | ||
Facility Closing [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring Reserve | $ 3,534 | |
Restructuring Charges | 0 | |
Restructuring Reserve, Accrual Adjustment | 572 | [1] |
Payments for Restructuring | (3,156) | |
Restructuring Reserve | 2,044 | [2],[3] |
Facility Closing [Member] | Interest Expense [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring Reserve, Accrual Adjustment | 1,094 | |
Restaurant Closing Costs [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Other Accrued Liabilities | $ 1,700 | |
Weighted Average [Member] | Facility Closing [Member] | ||
Restructuring Reserve [Roll Forward] | ||
RemainingLeaseCommitmentTerm | 4 years | |
[1] | Adjustments relate primarily to revisions of certain sublease and cost assumptions. Our estimates related to our future lease obligations, primarily the sublease income we anticipate, are subject to a high degree of judgment and may differ from actual sublease income due to changes in economic conditions, desirability of the sites and other factors. | |
[2] | The weighted average remaining lease term related to these commitments is approximately 4 years. | |
[3] | This balance excludes $1.7 million of restaurant closing costs that are included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets, which were initially recorded as losses on the sale of company-operated restaurants to franchisees. |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | Sep. 30, 2018 | ||
Income Tax Disclosure [Abstract] | ||||||
Income tax expense at statutory rate (percent) | 25.80% | 28.60% | 25.80% | 28.90% | 24.50% | |
Effective Income Tax Rate Reconciliation, Percent | [1] | (17.90%) | 26.50% | 18.40% | 46.90% | |
[1] | Percentages may not add due to rounding. |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | Sep. 30, 2018 | ||
Income Tax Disclosure [Abstract] | ||||||
Income tax expense at statutory rate, amount | $ 2,948 | $ 18,715 | $ 22,040 | $ 46,752 | ||
Income tax expense at statutory rate (percent) | 25.80% | 28.60% | 25.80% | 28.90% | 24.50% | |
One-time, non-cash impact of the Tax Act | $ 0 | $ 878 | $ 0 | $ 32,082 | ||
One-time, non-cash impact of the Tax Act (percent) | 0.00% | 1.30% | 0.00% | 19.80% | ||
Termination of interest rate swaps | $ (2,984) | $ 0 | $ (2,984) | $ 0 | ||
Termination of interest rate swaps (percent) | (26.10%) | 0.00% | (3.50%) | 0.00% | ||
Release of valuation reserve on state tax losses and credits | $ (873) | $ (1,312) | $ (1,023) | $ (1,312) | ||
Release of valuation reserve on state tax losses and credits (percent) | (7.60%) | (2.00%) | (1.20%) | (0.80%) | ||
Release of federal tax liability | $ (817) | $ 0 | $ (817) | $ 0 | ||
Release of federal tax liability (percent) | (7.20%) | 0.00% | (1.00%) | 0.00% | ||
Stock compensation excess tax benefit | $ (18) | $ (1,268) | $ (66) | $ (2,084) | ||
Stock compensation excess tax benefit (percent) | (0.20%) | (1.90%) | (0.10%) | (1.30%) | ||
Adjustment to state tax provision | $ 0 | $ 0 | $ (1,027) | $ 0 | ||
Adjustment to state tax provision (percent) | 0.00% | 0.00% | (1.20%) | 0.00% | ||
Other, amount | $ (304) | $ 321 | $ (424) | $ 460 | ||
Other (percent) | (2.60%) | 0.50% | (0.40%) | 0.30% | ||
Effective income tax rate, amount | [1] | $ (2,048) | $ 17,334 | $ 15,699 | $ 75,898 | |
Effective income tax rates, percent | [1] | (17.90%) | 26.50% | 18.40% | 46.90% | |
[1] | Percentages may not add due to rounding. |
Retirement Plans (Components Of
Retirement Plans (Components Of Net Periodic Benefit Cost) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 07, 2019USD ($) | Jul. 08, 2018USD ($) | Jul. 07, 2019USD ($)defined_benefit_planhealthcare_plan | Jul. 08, 2018USD ($) | ||
Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract] | |||||
Number of sponsored defined benefit pension plans | defined_benefit_plan | 2 | ||||
Number of postretirement health care plans | healthcare_plan | 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets | 6.20% | ||||
Pension Plan | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Interest cost | $ 5,286 | $ 5,159 | $ 17,619 | $ 17,198 | |
Service cost | 0 | 114 | 0 | 379 | |
Expected return on plan assets | [1] | (6,077) | (6,108) | (20,257) | (20,360) |
Actuarial gain (2) | [2] | 914 | 1,124 | 3,046 | 3,745 |
Amortization of unrecognized prior service cost | [2] | 27 | 34 | 89 | 113 |
Net periodic benefit cost | 150 | 323 | 497 | 1,075 | |
Postretirement Healthcare Plans | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Interest cost | 229 | 220 | 766 | 734 | |
Actuarial gain (2) | [2] | (37) | (6) | (122) | (20) |
Net periodic benefit cost | $ 192 | $ 214 | $ 644 | $ 714 | |
[1] | Determined as of the beginning of the year based on a return on asset assumption of 6.2% . | ||||
[2] | Amounts were reclassified from accumulated OCI into net earnings as a component of “Other pension and post-retirement expenses, net |
Retirement Plans (Schedule Of F
Retirement Plans (Schedule Of Future Cash Flows) (Details) - USD ($) | 9 Months Ended | |
Jul. 07, 2019 | Jan. 01, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Minimum required contribution for retirement plans | $ 0 | |
SERP | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Net year-to-date contributions | $ 4,213,000 | |
Remaining estimated net contributions during fiscal 2019 | 800,000 | |
Postretirement Healthcare Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Net year-to-date contributions | 913,000 | |
Remaining estimated net contributions during fiscal 2019 | $ 500,000 |
Stockholders' Equity Summary _2
Stockholders' Equity Summary of Changes in Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stockholders' Equity Attributable to Parent | $ (592,514) | $ (430,910) | $ (591,699) | $ (388,130) |
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures | 453 | 2,325 | 696 | 2,364 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | 1,881 | 1,684 | 6,589 | 7,950 |
Dividends declared | (10,326) | (11,252) | (30,967) | (34,698) |
Treasury Stock, Value, Acquired, Cost Method | 0 | (100,000) | 0 | (200,000) |
Net earnings | 13,189 | 45,307 | 72,376 | 105,102 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 6,756 | 2,376 | (226) | 17,093 |
Cumulative Effect on Retained Earnings, Net of Tax | 0 | 0 | (37,330) | (151) |
Stockholders' Equity Attributable to Parent | $ (580,561) | $ (490,470) | $ (580,561) | $ (490,470) |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 4 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jan. 20, 2019 | Jul. 07, 2019 | Jul. 08, 2018 | |
Stockholders' Equity Note [Abstract] | |||||
Repurchase of common stock, remaining authorized amount | $ 101,000 | $ 101,000 | |||
Payments for Repurchase of Common Stock | $ 14,362 | $ 200,000 | |||
Cash dividends declared per common share | $ 0.40 | $ 0.40 | $ 0.40 | $ 1.20 | $ 1.20 |
Dividends, Common Stock | $ 31,200 |
Average Shares Outstanding (Rec
Average Shares Outstanding (Reconciliation Of Basic Weighted-Average Shares Outstanding To Diluted Weighted-Average Shares Outstanding) (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 07, 2019 | Jul. 08, 2018 | Jul. 07, 2019 | Jul. 08, 2018 | |
Average Shares Outstanding [Line Items] | ||||
Weighted-average shares outstanding – basic | 25,958 | 28,042 | 25,933 | 28,989 |
Weighted-average shares outstanding - diluted | 26,176 | 28,296 | 26,150 | 29,284 |
Excluded from diluted weighted-average shares outstanding, Antidilutive | 186 | 192 | 186 | 139 |
Excluded from Diluted Weighted-Average Shares, Performance Conditions Not Satisfied | 89 | 67 | 89 | 67 |
Nonvested stock awards and units | ||||
Average Shares Outstanding [Line Items] | ||||
Effect of potentially dilutive securities | 206 | 215 | 205 | 241 |
Stock options | ||||
Average Shares Outstanding [Line Items] | ||||
Effect of potentially dilutive securities | 10 | 32 | 10 | 47 |
Performance share awards | ||||
Average Shares Outstanding [Line Items] | ||||
Effect of potentially dilutive securities | 2 | 7 | 2 | 7 |
Contingencies and Legal Matte_2
Contingencies and Legal Matters Contingencies and Legal Matters (Details) - USD ($) $ in Millions | Jun. 11, 2019 | Jan. 31, 2019 | Feb. 28, 2019 | Jul. 07, 2019 |
Loss Contingencies [Line Items] | ||||
Alleged total potential damages | $ 62 | $ 42 | ||
Estimated liability for general liability and workers' compensation claims in excess of self-insurance retention limits | $ 13.6 | |||
Ramirez v. Jack in the Box Inc. | Judicial Ruling | ||||
Loss Contingencies [Line Items] | ||||
Jury verdict for compensatory damages | $ 5.4 | |||
Jury verdict for punitive damages | $ 10 | |||
Selling, General and Administrative Expenses | Ramirez v. Jack in the Box Inc. | ||||
Loss Contingencies [Line Items] | ||||
Net charge for estimated litigation liability | $ 7.1 |
Supplemental Consolidated Cas_3
Supplemental Consolidated Cash Flow Information (Additional Information Related To Cash Flows) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 07, 2019 | Jul. 08, 2018 | |
Supplemental Cash Flow Information [Abstract] | ||
Decrease in obligations for treasury stock repurchases | $ 14,362 | $ 0 |
Decrease in obligations for purchases of property and equipment | 5,421 | 2,456 |
Increase (decrease) in dividends accrued or converted to stock equivalents | 184 | 218 |
Decrease in capital lease obligations from the termination of equipment and building leases | 41 | 3,654 |
Increase in notes receivable from the sale of company-operated restaurants | 0 | 31,160 |
Equipment capital lease obligations incurred | $ 0 | $ 78 |
Supplemental Consolidated Bal_3
Supplemental Consolidated Balance Sheet Information (Details) - USD ($) $ in Thousands | Jul. 07, 2019 | Sep. 30, 2018 |
Balance Sheet Related Disclosures [Abstract] | ||
Trade | $ 44,403 | $ 35,877 |
Notes receivable | 1,854 | 11,480 |
Due from marketing fund | 839 | 0 |
Income tax receivable | 184 | 5,637 |
Other | 12,059 | 6,123 |
Allowance for doubtful accounts | (1,692) | (1,695) |
Receivables, Net, Current | 57,647 | 57,422 |
Prepaid rent | 11,977 | 0 |
Prepaid income taxes | 0 | 4,837 |
Prepaid advertising | 28 | 4,318 |
Other | 5,479 | 5,288 |
Prepaid Expense, Current | 17,484 | 14,443 |
Company-owned life insurance policies | 113,025 | 109,908 |
Deferred rent receivable | 49,204 | 48,372 |
Franchise tenant improvement allowance | 24,328 | 22,506 |
Other | 28,677 | 18,480 |
Other assets, net | 215,234 | 199,266 |
Insurance | 30,206 | 35,405 |
Payroll and related taxes | 24,807 | 29,498 |
Deferred franchise fees | 4,968 | 375 |
Deferred rent income | 16,960 | 1,387 |
Sales and property taxes | 4,097 | 4,555 |
Gift card liability | 2,109 | 2,081 |
Other | 41,676 | 33,621 |
Accrued liabilities | 124,823 | 106,922 |
Defined benefit pension plans | 66,185 | 69,012 |
Deferred franchise fees, Noncurrent | 42,063 | 0 |
Straight-line rent accrual | 29,700 | 31,762 |
Other | 83,271 | 92,675 |
Other long-term liabilities | $ 221,219 | $ 193,449 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Aug. 02, 2019 | Jul. 25, 2019 | Jul. 08, 2019 | Jul. 07, 2019 | Jul. 08, 2018 | Jan. 20, 2019 | Jul. 07, 2019 | Jul. 08, 2018 |
Subsequent Event [Line Items] | ||||||||
Cash dividends declared per common share | $ 0.40 | $ 0.40 | $ 0.40 | $ 1.20 | $ 1.20 | |||
Payments to acquire commercial property | $ 25,041,000 | $ 25,730,000 | ||||||
Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Cash dividends declared per common share | $ 0.40 | |||||||
Stock repurchase program, authorized amount | $ 200,000,000 | |||||||
Payments to acquire commercial property | $ 17,300,000 | |||||||
Series 2019-1 3.982% Fixed Rate Senior Secured Notes, Class A-2-I | Senior Notes | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Sale of fixed rate senior secured notes | $ 575,000,000 | |||||||
Stated interest rate (percent) | 3.982% | |||||||
Series 2019-1 3.982% Fixed Rate Senior Secured Notes, Class A-2-II | Senior Notes | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Sale of fixed rate senior secured notes | $ 275,000,000 | |||||||
Stated interest rate (percent) | 4.476% | |||||||
Series 2019-1 3.982% Fixed Rate Senior Secured Notes, Class A-2-III | Senior Notes | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Sale of fixed rate senior secured notes | $ 450,000,000 | |||||||
Stated interest rate (percent) | 4.97% | |||||||
Series 2019-1 Variable Funding Senior Secured Notes, Class A-1 | Senior Notes | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt issuable under purchase agreement | $ 150,000,000 |