Document And Entity Information
Document And Entity Information - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Apr. 01, 2018 | May 03, 2019 | |
Document Information [Line Items] | |||
Stock-based compensation | $ 1,526 | $ 1,585 | |
Entity Registrant Name | CARROLS RESTAURANT GROUP, INC. | ||
Entity Central Index Key | 0000809248 | ||
Current Fiscal Year End Date | --12-29 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-Q | ||
Document Period End Date | Mar. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | Q1 | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 44,371,515 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 30, 2018 |
ASSETS | ||
Cash | $ 1,668 | $ 4,014 |
Trade and other receivables | 12,214 | 11,693 |
Inventories | 9,571 | 10,396 |
Prepaid rent | 1,527 | 1,880 |
Prepaid expenses and other current assets | 8,937 | 6,695 |
Refundable income taxes | 32 | 0 |
Total current assets | 33,949 | 34,678 |
Property and equipment, net | 288,256 | 289,817 |
Franchise rights, net | 173,867 | 175,897 |
Goodwill | 38,469 | 38,469 |
Franchise agreements, net | 25,251 | 24,414 |
Operating leases | 525,008 | 0 |
Deferred income taxes | 25,376 | 28,291 |
Other assets | 2,299 | 8,685 |
Total assets | 1,112,475 | 600,251 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Current portion of long-term debt and finance lease liabilities | 1,969 | 1,948 |
Less: current portion | 32,732 | 0 |
Accounts payable | 23,893 | 29,143 |
Accrued interest | 9,174 | 3,818 |
Accrued payroll, related taxes and benefits | 22,288 | 28,719 |
Accrued real estate taxes | 5,039 | 5,910 |
Other liabilities | 20,690 | 12,601 |
Total current liabilities | 115,785 | 82,139 |
Long-term debt and finance lease liabilities, net of current portion | 282,256 | 276,823 |
Lease financing obligations | 1,195 | 1,196 |
Operating lease liabilities | 518,113 | 0 |
Deferred income-sale-leaseback of real estate | 0 | 10,073 |
Accrued postretirement benefits | 4,362 | 4,320 |
Other liabilities | 7,663 | 40,160 |
Total liabilities | 929,374 | 414,711 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, par value $.01 | 0 | 0 |
Voting common stock, par value $.01 | 361 | 357 |
Additional paid-in capital | 151,981 | 150,459 |
Accumulated deficit | 31,546 | 35,511 |
Accumulated other comprehensive income | (646) | (646) |
Treasury stock, at cost | (141) | (141) |
Total stockholders' equity | 183,101 | 185,540 |
Total liabilities and stockholders' equity | $ 1,112,475 | $ 600,251 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 30, 2018 |
Statement of Financial Position [Abstract] | ||
Property and equipment, accumulated depreciation | $ 340,148 | $ 328,873 |
Franchise rights, accumulated amortization | 110,051 | 108,021 |
Franchise agreements, accumulated amortization | 12,299 | 12,022 |
Favorable leases, accumulated amortization | 2,129 | 2,256 |
Unfavorable leases, accumulated amortization | $ 6,019 | $ 6,075 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 100 | 100 |
Preferred stock, shares outstanding | 100 | 100 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 37,007,102 | 36,538,903 |
Common stock, shares, outstanding | 36,114,251 | 35,742,427 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations And Comprehensive Income - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Revenues: | ||
Restaurant sales | $ 290,789,000 | $ 271,586,000 |
Costs and expenses: | ||
Cost of sales | 82,575,000 | 73,005,000 |
Restaurant wages and related expenses | 100,192,000 | 91,144,000 |
Restaurant rent expense | 21,916,000 | 19,974,000 |
Other restaurant operating expenses | 45,605,000 | 42,839,000 |
Advertising expense | 11,872,000 | 11,265,000 |
General and administrative (including stock-based compensation expense of $1,526 and $1,585, respectively) | 19,724,000 | 16,136,000 |
Depreciation and amortization | 15,292,000 | 14,250,000 |
Impairment and other lease charges | 910,000 | 309,000 |
Other income, net | (2,129,000) | 0 |
Total operating expenses | 295,957,000 | 268,922,000 |
Income (loss) from operations | (5,168,000) | 2,664,000 |
Interest expense | 5,947,000 | 5,926,000 |
Gain on bargain purchase | 0 | (22,000) |
Loss before income taxes | (11,115,000) | (3,240,000) |
Provision for income taxes | 354,000 | (138,000) |
Net loss | $ (11,469,000) | $ (3,102,000) |
Basic and diluted net income (loss) per share | $ (0.32) | $ (0.09) |
Other comprehensive income (loss), net of tax: | ||
Net loss | $ (11,469,000) | $ (3,102,000) |
Other comprehensive income | 0 | 0 |
Comprehensive loss | $ (11,469,000) | $ (3,102,000) |
Consolidated Statements Of Op_2
Consolidated Statements Of Operations And Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Stock-based compensation | $ 1,526 | $ 1,585 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholder's Equity Statement - USD ($) | Total | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Treasury Stock [Member] |
Beginning balance (in shares) at Dec. 31, 2017 | 35,436,252 | ||||||
Beginning balance at Dec. 31, 2017 | $ 169,060,000 | $ 354,000 | $ 0 | $ 144,650,000 | $ 25,407,000 | $ (1,210,000) | $ (141,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock-based compensation | 1,585,000 | $ 0 | 0 | 1,585,000 | 0 | 0 | 0 |
Vesting of non-vested shares and excess tax benefits (in shares) | 283,248 | ||||||
Vesting of non-vested shares | 0 | $ 3,000 | 0 | (3,000) | 0 | 0 | 0 |
Net income | (3,102,000) | $ 0 | 0 | 0 | (3,102,000) | 0 | 0 |
Ending balance (in shares) at Apr. 01, 2018 | 35,719,500 | ||||||
Ending balance at Apr. 01, 2018 | $ 167,543,000 | $ 357,000 | 0 | 146,232,000 | 22,305,000 | (1,210,000) | (141,000) |
Beginning balance (in shares) at Dec. 30, 2018 | 35,742,427 | 35,742,427 | |||||
Beginning balance at Dec. 30, 2018 | $ 185,540,000 | $ 357,000 | 0 | 150,459,000 | 35,511,000 | (646,000) | (141,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock-based compensation | 1,526,000 | $ 0 | 0 | 1,526,000 | 0 | 0 | 0 |
Vesting of non-vested shares and excess tax benefits (in shares) | 371,824 | ||||||
Vesting of non-vested shares | 0 | $ 4,000 | 0 | (4,000) | 0 | 0 | 0 |
Net income | $ (11,469,000) | $ 0 | 0 | 0 | (11,469,000) | 0 | 0 |
Ending balance (in shares) at Mar. 31, 2019 | 36,114,251 | 36,114,251 | |||||
Ending balance at Mar. 31, 2019 | $ 183,101,000 | $ 361,000 | $ 0 | $ 151,981,000 | $ 31,546,000 | $ (646,000) | $ (141,000) |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Cash flows provided from (used for) operating activities: | ||
Net income | $ (11,469) | $ (3,102) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Loss on disposals of property and equipment | 146 | 75 |
Stock-based compensation | 1,526 | 1,585 |
Gain on bargain purchase | 0 | (20) |
Gain (Loss) Related to Litigation Settlement | (1,913) | 0 |
Impairment and other lease charges | 910 | 309 |
Depreciation and amortization | 15,292 | 14,250 |
Amortization of deferred financing costs | 299 | 300 |
Amortization of bond premium | (238) | (223) |
Amortization of deferred gains from sale-leaseback transactions | 0 | (395) |
Deferred income taxes | 346 | (138) |
Change in refundable income taxes | 32 | 0 |
Changes in other operating assets and liabilities | 3,121 | 7,197 |
Net cash provided by operating activities | 7,988 | 19,838 |
Cash flows used for investing activities: | ||
New restaurant development | (5,507) | (7,132) |
Restaurant remodeling | (7,607) | (7,054) |
Other restaurant capital expenditures | (4,474) | (3,201) |
Corporate and restaurant information systems | (587) | (541) |
Total capital expenditures | (18,175) | (17,928) |
Properties purchased for sale-leaseback | 0 | (2,173) |
Proceeds from sale-leaseback transactions | 2,302 | 1,292 |
Proceeds from insurance recoveries | 123 | 0 |
Net cash used for investing activities | (15,750) | (18,809) |
Cash flows provided by financing activities: | ||
Borrowings under prior senior credit facility | 89,250 | 4,500 |
Repayments under prior senior credit facility | (83,000) | 0 |
Payments on finance lease liabilities | 476 | 440 |
Costs associated with financing long-term debt | (358) | 0 |
Net cash provided by financing activities | 5,416 | 4,060 |
Net increase (decrease) in cash and cash equivalents | (2,346) | 5,089 |
Cash and cash equivalents, beginning of period | 4,014 | 29,412 |
Cash and cash equivalents, end of period | 1,668 | 34,501 |
Supplemental disclosures: | ||
Interest paid on long-term debt | 503 | 320 |
Interest paid on lease financing obligations | 26 | 26 |
Accruals for capital expenditures | 5,161 | 3,577 |
Income taxes refunded (paid) | (45) | 1 |
Lease assets obtained in exchange for new operating lease liabilities | $ 15,952 | $ 0 |
Basis Of Presentation (Notes)
Basis Of Presentation (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis Of Presentation | Basis of Presentation Business Description. At March 31, 2019 Carrols Restaurant Group, Inc. ("Carrols Restaurant Group") operated, as franchisee, 845 restaurants under the trade name “Burger King ® ” in 18 Northeastern, Midwestern and Southeastern states. Basis of Consolidation. Carrols Restaurant Group is a holding company and conducts all of its operations through its wholly-owned subsidiary, Carrols Holdco Inc. ("Carrols Holdco") and Carrols Holdco's wholly-owned subsidiary, Carrols Corporation (“Carrols”) and Carrols' wholly-owned subsidiary, Carrols LLC, a Delaware limited liability company, and Carrols LLC's wholly-owned subsidiary Republic Foods, Inc., a Maryland corporation ("Republic Foods") . The unaudited condensed consolidated financial statements presented herein include the accounts of Carrols Restaurant Group and its wholly-owned subsidiary Carrols. Unless the context otherwise requires, Carrols Restaurant Group, Carrols Holdco, Carrols, Carrols LLC and Republic Foods, Inc. are collectively referred to as the “Company.” All intercompany transactions have been eliminated in consolidation. Fiscal Year. The Company uses a 52 - 53 week fiscal year ending on the Sunday closest to December 31. The three months ended March 31, 2019 and April 1, 2018 each contained thirteen weeks, respectively. The 2019 fiscal year will end December 29, 2019 and will contain 52 weeks. Basis of Presentation. The accompanying unaudited condensed consolidated financial statements as of and for the three months ended March 31, 2019 and April 1, 2018 have been prepared without an audit, pursuant to the rules and regulations of the Securities and Exchange Commission and do not include certain of the information and the footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all normal and recurring adjustments considered necessary for a fair presentation of such unaudited condensed consolidated financial statements have been included. The results of operations for the three months ended March 31, 2019 and April 1, 2018 are not necessarily indicative of the results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 30, 2018 . The December 30, 2018 consolidated balance sheet data is derived from those audited consolidated financial statements. Use of Estimates. The preparation of the accompanying unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates include: accrued occupancy costs, insurance liabilities, evaluation for impairment of long-lived assets and franchise rights, lease accounting matters, the valuation of acquired assets and liabilities and the valuation of deferred income tax assets. Actual results could differ from those estimates. Segment Information. Operating segments are components of an entity for which separate financial information is available and is regularly reviewed by the chief operating decision maker in order to allocate resources and assess performance. The Company's chief operating decision maker currently evaluates the Company's operations from a number of different operational perspectives; however resource allocation decisions are determined based on the chief operating decision maker's evaluation of the total Company operations. The Company derives all significant revenues from a single operating segment. Accordingly, the Company views the operating results of its Burger King ® restaurants as one reportable segment. Business Combinations. In accordance with ASC 805, the Company allocates the purchase price of an acquired business to its net identifiable assets and liabilities based on the estimated fair values. The excess of the purchase price over the amount allocated to the assets and liabilities, if any, is recorded as goodwill. The excess value of the net identifiable assets and liabilities acquired over the purchase price, if any, is recorded as a bargain purchase gain. The Company uses all available information to estimate fair values of identifiable intangible assets and property acquired. In making these determinations, the Company may engage an independent third party valuation specialist to assist with the valuation of certain leasehold improvements, franchise rights and favorable and unfavorable leases. The Company estimates that the seller's carrying value of acquired restaurant equipment, subject to certain adjustments, is equivalent to fair value of this equipment at the date of the acquisition. The fair values of assumed franchise agreements are valued as if the remaining term of the agreement is at the market rate. The fair values of acquired land, buildings, certain leasehold improvements and restaurant equipment subject to finance leases are determined using both the cost approach and market approach. The fair value of the favorable and unfavorable leases acquired, as well as the fair value of land, buildings, leasehold improvements and restaurant equipment subject to finance leases acquired is measured using significant inputs observable in the open market. The Company categorizes all such inputs as Level 2 inputs under ASC 820. The fair value of acquired franchise rights is primarily determined using the income approach, and unobservable inputs classified as Level 3 under ASC 820. Cash and Cash Equivalents. The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. At December 30, 2018 , the Company had $2.3 million invested in money market funds, which are classified as cash equivalents on the condensed consolidated balance sheet. Fair Value of Financial Instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. In determining fair value, the accounting standards establish a three level hierarchy for inputs used in measuring fair value as follows: Level 1 inputs are quoted prices in active markets for identical assets or liabilities; Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities; and Level 3 inputs are unobservable and reflect the Company's own assumptions. Financial instruments include cash and cash equivalents, trade and other receivables, accounts payable and long-term debt. The carrying amounts of cash and cash equivalents, trade and other receivables and accounts payable approximate fair value because of the short-term nature of these financial instruments. The fair value of the Carrols Restaurant Group 8.0% Senior Secured Second Lien Notes due 2022 is based on a recent trading value, which is considered Level 2, and at March 31, 2019 and December 30, 2018 was approximately $280.5 million and $277.1 million , respectively. Fair value measurements of non-financial assets and non-financial liabilities are primarily used in the impairment analysis of long-lived assets, goodwill and intangible assets. Long-lived assets and definite-lived intangible assets are measured at fair value on a nonrecurring basis using Level 3 inputs. As described in Note 4, the Company recorded long-lived asset impairment charges of $0.9 million during the three months ended March 31, 2019 and $0.1 million during the three months ended April 1, 2018 . Recently Issued Accounting Pronouncements Adopted. The Company adopted Accounting Standards Update ("ASU")No. 2016-02, Leases (Topic 842) on December 31, 2018, the first day of fiscal 2019. The new standard requires a lessee to recognize a liability for lease obligations, representing the discounted obligation to make minimum lease payments, and a corresponding right-of-use asset on the balance sheet for all leases with a term longer than 12 months. The Company elected the optional transition method to initially apply the new lease standard at the adoption date and not adjust its comparative period consolidated financial statements. The Company has elected the package of three practical expedients, which permits the Company not to reassess prior conclusions about lease identification, lease classification and initial direct costs. The Company has not elected the use-of-hindsight or the practical expedient in determining lease term or impairment of right-of-use assets. In addition, the Company has elected a short-term lease exemption policy that permits the Company to not apply the recognition requirements of the new lease standard to leases with a term of 12 months or less. The Company has also elected an accounting policy to not separate lease and non-lease components for certain classes of leases. Adoption of this ASU resulted in recognition of additional net lease assets of approximately $517.6 million and net lease liabilities of approximately $542.9 million , respectively, as of December 31, 2018 based on the present value of remaining minimum rental payments and corresponding right-of-use assets based upon the operating lease liabilities adjusted for prepaid and deferred non-level rents, unamortized lease acquisition costs and unamortized favorable and unfavorable lease balances. The Company has recognized a cumulative-effect adjustment to retained earnings of approximately $7.5 million , net of the deferred tax impact, on the date of adoption, to eliminate the historical deferred gains on qualified sale-leaseback transactions. The standard did not materially impact the condensed consolidated statements of cash flows. Recently Issued Accounting Standards Not Yet Adopted. In January 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU simplifies the accounting for goodwill by eliminating step 2 from the goodwill impairment test. Under the new ASU, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized for the amount by which the carrying amount exceeds its fair value. This update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted. The Company believes that this pronouncement will have no impact on its consolidated financial statements and related disclosures. |
Acquisition (Notes)
Acquisition (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | Acquisitions In 2012, as part of an acquisition of restaurants from Burger King Corporation ("BKC"), the Company was assigned BKC's right of first refusal on the sale of franchisee-operated restaurants in 20 states (the "ROFR"). Since the beginning of 2018, the Company has acquired an aggregate of 44 restaurants from other franchisees in the following transactions, some of which were subject to the ROFR (in thousands, except number of restaurants): Closing Date Number of Restaurants Purchase Price Market Location February 13, 2018 (1) 1 $ — New York August 21, 2018 (2) 2 1,666 Detroit, Michigan September 5, 2018 (2) 31 25,930 Western Virginia October 2, 2018 10 10,506 South Carolina and Georgia 44 $ 38,102 (1) During the first quarter of 2018, the allocation of the purchase price and the resulting bargain purchase gain for this acquisition was preliminary and subject to adjustment. Specifically, the Company was finalizing the valuation of franchise rights which will impact the amount of the bargain purchase gain. In the second quarter of 2018, the Company recorded a bargain purchase gain because the fair value of assets acquired, largely representing a franchise right asset of $0.3 million , exceeded the total fair value of consideration paid by $0.2 million . (2) Acquisitions resulting from the exercise of the ROFR. The Company allocated the aggregate purchase price to the net tangible and intangible assets acquired in the acquisitions at their estimated fair values. The following table summarizes the preliminary allocation of the aggregate purchase price for the 2018 acquisitions reflected in the condensed consolidated balance sheets as of December 30, 2018 . Inventory $ 401 Restaurant equipment 2,092 Restaurant equipment - subject to finance leases 43 Leasehold improvements 1,329 Franchise fees 1,264 Franchise rights (Note 3) 31,275 Favorable leases (Note 3) 587 Deferred income taxes 346 Goodwill (Note 3) 1,677 Finance lease liabilities for restaurant equipment (49 ) Unfavorable leases (Note 3) (624 ) Accounts payable (9 ) Net assets acquired $ 38,332 The results of operations for the restaurants acquired are included from the closing date of the respective acquisition. The 2018 acquired restaurants contributed restaurant sales of $13.0 million in the three months ended March 31, 2019 and contributed restaurant sales of $0.1 million in the three months ended April 1, 2018 , respectively. It is impracticable to disclose net earnings for the post-acquisition period for the acquired restaurants as net earnings of these restaurants were not tracked on a collective basis due to the integration of administrative functions, including field supervision. The unaudited pro forma impact on the results of operations for the restaurants acquired in 2018 for the three months ended March 31, 2019 and April 1, 2018 is included below. The unaudited pro forma results of operations are not necessarily indicative of the results that would have occurred had the acquisitions been consummated at the beginning of the periods presented, nor are they necessarily indicative of any future consolidated operating results. The following table summarizes the Company's unaudited pro forma operating results: Three Months Ended March 31, 2019 April 1, 2018 Restaurant sales $ 290,789 $ 284,817 Net loss $ (11,469 ) $ (2,269 ) Basic and diluted net loss per share $ (0.32 ) $ (0.06 ) This unaudited pro forma financial information does not give effect to any anticipated synergies, operating efficiencies, cost savings or any integration costs related to the acquired restaurants. The unaudited pro forma financial results exclude transaction costs recorded as general and administrative expenses of $0.1 million during the three months ended April 1, 2018 . |
Intangible Assets (Notes)
Intangible Assets (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill And Franchise Rights [Text Block] | Intangible Assets Goodwill. The Company is required to review goodwill for impairment annually, or more frequently when events and circumstances indicate that the carrying amount may be impaired. If the determined fair value of goodwill is less than the related carrying amount, an impairment loss is recognized. The Company performs its annual impairment assessment as of the last day of its fiscal year and does not believe circumstances have changed since the last assessment date which would make it necessary to reassess the value of its goodwill. There have been no recorded goodwill impairment losses during the three months ended March 31, 2019 or April 1, 2018 . There has been no change in goodwill for the three months ended March 31, 2019 . Franchise Rights. Amounts allocated to franchise rights for each acquisition of Burger King ® restaurants are amortized using the straight-line method over the average remaining term of the acquired franchise agreements plus one twenty -year renewal period. The Company assesses the potential impairment of franchise rights whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If an indicator of impairment exists, an estimate of the aggregate undiscounted cash flows from the acquired restaurants is compared to the respective carrying value of franchise rights for each acquisition. If an asset is determined to be impaired, the loss is measured by the excess of the carrying amount of the asset over its fair value. No impairment charges were recorded related to the Company’s franchise rights for the three months ended March 31, 2019 or April 1, 2018 . The change in franchise rights for the three months ended March 31, 2019 is summarized below: Balance at December 30, 2018 $ 175,897 Amortization expense (2,030 ) Balance at March 31, 2019 $ 173,867 Amortization expense related to franchise rights was $2.0 million and $1.8 million for the three months ended March 31, 2019 and April 1, 2018 , respectively. The Company expects annual amortization expense to be $8.1 million in 2019 and $8.1 million in each of the following five years. |
Impairment Of Long-Lived Assets
Impairment Of Long-Lived Assets And Other Lease Charges (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Asset Impairment Charges [Abstract] | |
Asset Impairment Charges [Text Block] | Impairment of Long-Lived Assets and Other Lease Charges The Company reviews its long-lived assets, principally property and equipment, for impairment at the restaurant level. If an indicator of impairment exists for any of its assets, an estimate of the undiscounted future cash flows over the life of the primary asset for each restaurant is compared to that long-lived asset’s carrying value. If the carrying value is greater than the undiscounted cash flow, the Company then determines the fair value of the asset and if an asset is determined to be impaired, the loss is measured by the excess of the carrying amount of the asset over its fair value. For closed restaurant locations, the Company reviews the future minimum lease payments and related ancillary costs from the date of the restaurant closure to the end of the remaining lease term and records a lease charge for the lease liabilities to be incurred, net of any estimated sublease recoveries. The Company determines the fair value of restaurant equipment, for those restaurants reviewed for impairment, based on current economic conditions and the Company’s history of transferring these assets in the operation of its business. The Company determines the fair value of right-of-use lease assets based on an assessment of market rents and a discounted future cash flow model. These fair value asset measurements rely on significant unobservable inputs and are considered Level 3 in the fair value hierarchy. During the three months ended March 31, 2019 , the Company recorded impairment and other lease charges of $0.9 million consisting of $0.7 million related to initial impairment charges for two underperforming restaurants, capital expenditures of $0.1 million at previously impaired restaurants, and $0.1 million of other lease charges primarily due to the de-imaging of six restaurants closed during the first quarter. During the three months ended April 1, 2018 , the Company recorded impairment and other lease charges of $0.3 million which included $0.1 million of capital expenditures at previously impaired restaurants, a loss of $0.1 million associated with a sale-leaseback of a restaurant property, and $0.1 million of other lease charges associated with the closure of two underperforming restaurants. The following table presents the activity in the accrual for closed restaurant locations: Three Months Ended Year Ended March 31, 2019 December 30, 2018 Balance, beginning of period $ 1,352 $ 2,028 Provisions for closures 41 249 Changes in estimates of accrued costs (11 ) (147 ) Payments, net (144 ) (889 ) Other adjustments, including the effect of discounting future obligations 23 111 Balance, end of period $ 1,261 $ 1,352 Changes in estimates of accrued costs primarily relate to revisions or terminations of certain closed restaurant leases, changes in assumptions for sublease income and other costs. |
Other Liabilities, Long-Term (N
Other Liabilities, Long-Term (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Other Liabilities, Noncurrent [Abstract] | |
Other Liabilities Disclosure [Text Block] | Other Liabilities, Long-Term Other liabilities, long-term, at March 31, 2019 and December 30, 2018 consisted of the following: March 31, 2019 December 30, 2018 Deferred rent $ — $ 16,610 Unfavorable leases, net 28 12,348 Accrual for closed restaurants, long-term 442 3,074 Accrued workers’ compensation and general liability claims 3,429 4,398 Deferred compensation 3,644 3,610 Other 120 120 $ 7,663 $ 40,160 In accordance with the adoption of ASC 842, as of December 31, 2018, the first day of fiscal 2019, unamortized unfavorable leases of $12.3 million , deferred rent balances of $16.6 million and unamortized lease incentives of $2.6 million were reclassified to adjust the beginning balance of operating right-of-use assets. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company utilizes land and buildings in its operations under various lease agreements. The Company does not consider any one of these individual leases material to the Company's operations. Initial lease terms are generally for twenty years and, in many cases, provide for renewal options and in most cases rent escalations. Certain leases require contingent rent, determined as a percentage of sales as defined by the terms of the applicable lease agreement. For most locations, the Company is obligated for occupancy related costs including payment of property taxes, insurance and utilities. Right-of-use (“ROU”) lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make payments in exchange for that right of use. Operating lease ROU assets are presented as operating right-of-use assets, net, the current portion of operating lease liabilities are presented as current portion of operating lease liabilities, and the non-current portion of operating lease liabilities are presented as operating lease liabilities in the condensed consolidated balance sheets. The current portion of operating lease liabilities was $ 32.7 million as of March 31, 2019. Leases with a term of 12 months or less are not recorded on the balance sheet. The discount rate implicit within our leases is generally not readily determinable, and therefore, the Company uses its estimated incremental borrowing rate in determining the present value of lease payments. The incremental borrowing rate considers the Company’s recent debt issuances and lease term. The Company’s real estate leases often contain options to renew, and less frequently, termination options. The exercise of such renewal and termination options are generally at the Company’s sole discretion. The Company evaluates renewal and termination options at lease commencement to determine if such options are reasonably certain to be exercised based on economic factors. As of March 31, 2019 , the Company had additional leases that have not yet commenced of $9.2 million . These leases will commence between fiscal 2019 and 2020 with lease terms of 15 years to 20 years. In addition, the Company utilizes certain restaurant equipment under various finance lease agreements. The Company does not consider any one of these individual leases material to the Company's operations. Initial lease terms are generally eight years. Leases with an initial term of 12 months or less are not recorded on the balance sheet and are recognized as lease expense on a straight-line basis over the lease term. The Company does not account for lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) separately from the non-lease components. Lease Position Supplemental balance sheet information related to leases was as follows: As of Leases Classification March 31, 2019 Assets Operating leases Operating right-of-use assets, net $ 525,008 Finance leases Property and equipment, net 2,663 Total leased assets $ 527,671 Liabilities Current Operating leases Current portion of operating lease liabilities $ 32,732 Finance leases Current portion of long-term debt and finance lease liabilities 1,969 Long-term Operating leases Operating lease liabilities 518,113 Finance leases Long-term debt and finance lease liabilities, net 1,496 Total lease liabilities $ 554,310 Weighted Average Remaining Lease Term Operating leases 13.7 years Finance leases 1.9 years Weighted Average Discount Rate Operating leases 7.0 % Finance leases 7.4 % For certain leases where rent escalates based upon a change in a financial index, such as the Consumer Price Index, the difference between the rate at lease inception and the subsequent fluctuations in that rate are included in variable lease costs. Additionally, because the Company has elected to not separate lease and non-lease components, in limited instances, variable costs also include payments to the landlord for common area maintenance, real estate taxes, insurance and other operating expenses. Lease expense is recognized on a straight-line basis over the lease term, with variable lease payments recognized in the period those payments are incurred. Lease Cost The components and classification of lease expense for the three months ended March 31, 2019 are as follows: Three Months Ended Lease cost Classification March 31, 2019 Operating lease cost (1) Rent expense $ 18,294 Variable lease cost Rent expense 3,800 Sublease income Rent expense (178 ) Finance lease cost: Amortization of right-of-use assets Depreciation and amortization 476 Interest on lease liabilities Interest expense 71 Total lease cost $ 22,463 (1) Includes short-term leases, which are not material. Other Information Supplemental cash flow information related to leases was as follows: Three Months Ended March 31, 2019 Gain on sale-leaseback transactions $ 93 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 17,366 Operating cash flows from finance leases $ 71 Financing cash flows from finance leases $ 476 Undiscounted Cash Flows Maturities of lease liabilities were as follows: Fiscal year ending: Operating Leases Finance Leases December 29, 2019 $ 52,148 $ 1,633 January 3, 2021 66,866 1,454 January 2, 2022 65,139 345 January 1, 2023 64,211 190 December 31, 2023 62,836 68 Thereafter 558,864 129 Total minimum lease payments 870,064 3,819 Less: imputed interest (319,219 ) (354 ) Present value of lease liabilities 550,845 3,465 Less: current portion (32,732 ) (1,969 ) Total long-term lease liabilities $ 518,113 $ 1,496 Disclosures Related to Periods Prior to Adoption of the New Lease Standard As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, the maturities of lease liabilities at December 30, 2018 were as follows: Fiscal year ending: Operating Leases Capital Leases December 29, 2019 $ 73,304 $ 2,180 January 3, 2021 71,764 1,454 January 2, 2022 70,607 345 January 1, 2023 70,160 190 December 31, 2023 69,221 68 Thereafter 640,793 129 Total minimum lease payments $ 995,849 4,366 Less amount representing interest (425 ) Total obligations under capital leases 3,941 Less current portion (1,948 ) Long-term obligations under capital leases $ 1,993 |
Long-Term Debt (Notes)
Long-Term Debt (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Long-term Debt, Unclassified [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt at March 31, 2019 and December 30, 2018 consisted of the following: March 31, 2019 December 30, 2018 Collateralized: Carrols Restaurant Group 8% Senior Secured Second Lien Notes $ 275,000 $ 275,000 Prior Senior Credit Facility - Revolving credit borrowings 6,250 — Finance lease liabilities 3,465 3,941 284,715 278,941 Less: current portion of finance lease liabilities (1,969 ) (1,948 ) Less: deferred financing costs (3,756 ) (3,673 ) Add: bond premium 3,266 3,503 Total Long-term debt $ 282,256 $ 276,823 On April 30, 2019, the Company entered into a new senior secured credit facility in an aggregate principal amount of $550.0 million, the proceeds of which, in part were used to refinance the existing indebtedness. See Note 14 to the unaudited condensed consolidated financial statements. 8% Notes. On April 29, 2015, the Company issued $200.0 million principal amount of 8.0% Senior Secured Second Lien Notes due 2022 (the "Existing Notes") pursuant to an indenture dated as of April 29, 2015 governing such notes. On June 23, 2017, the Company issued an additional $75.0 million principal amount of 8.0% Senior Secured Second Lien Notes due 2022 (the "Additional Notes" and together with the "Existing Notes", the "8% Notes"). The 8% Notes mature and were payable on May 1, 2022. Interest was payable semi-annually on May 1 and November 1. The 8% Notes were guaranteed by the Company's subsidiaries and were secured by second-priority liens on substantially all of the Company's and its subsidiaries' assets (including a pledge of all of the capital stock and equity interests of its subsidiaries). The 8% Notes were redeemable at the option of the Company in whole or in part at any time after May 1, 2018 at a price of 104% of the principal amount plus accrued and unpaid interest, if any, if redeemed before May 1, 2019, 102% of the principal amount plus accrued and unpaid interest, if any, if redeemed after May 1, 2019 but before May 1, 2020 and 100% of the principal amount plus accrued and unpaid interest, if any, if redeemed after May 1, 2020. The 8% Notes were jointly and severally guaranteed, unconditionally and in full by the Company's subsidiaries which are directly or indirectly 100% owned by the Company. Separate condensed consolidating information is not included because Carrols Restaurant Group is a holding company that has no independent assets or operations. There are no significant restrictions on the Company's ability or any of the guarantor subsidiaries' ability to obtain funds from its respective subsidiaries. All consolidated amounts in our unaudited condensed consolidated financial statements are representative of the combined guarantors. The indenture governing the 8% Notes included certain covenants, including limitations and restrictions on the Company and its subsidiaries who are guarantors under such indenture to, among other things: incur indebtedness or issue preferred stock; incur liens; pay dividends or make distributions in respect of capital stock or make certain other restricted payments or investments; sell assets; agree to payment restrictions affecting certain subsidiaries; enter into transaction with affiliates; or merge, consolidate or sell substantially all of the Company's assets. The indenture governing the 8% Notes and the security agreement provided that any capital stock and equity interests of any of the Company's subsidiaries would be excluded from the collateral to the extent that the par value, book value or market value of such capital stock or equity interests exceeds 20% of the aggregate principal amount of the 8% Notes then outstanding. The indenture governing the 8% Notes contained customary default provisions, including without limitation, a cross default provision pursuant to which it is an event of default under the 8% Notes and the indenture governing the 8% Notes if there is a default under any of the Company's indebtedness having an outstanding principal amount of $20.0 million or more which results in the acceleration of such indebtedness prior to its stated maturity or is caused by a failure to pay principal when due. Prior Senior Credit Facility. On May 30, 2012, the Company entered into a senior credit facility, which has a maturity date of February 12, 2021, and was most recently amended on June 20, 2017 to increase the permitted indebtedness of our second lien notes to a principal amount not to exceed $300.0 million in order to provide for the additional $75.0 million of the 8% Notes issued on June 23, 2017. On January 13, 2017, the senior credit facility was amended to, among other things, provide for maximum revolving credit borrowings of up to $73.0 million (including $20.0 million available for letters of credit). The amended senior credit facility also provides for potential incremental borrowing increases of up to $25.0 million , in the aggregate. As of March 31, 2019 , there were $6.3 million of revolving credit borrowings outstanding and $11.6 million of letters of credit were issued under the senior credit facility. After reserving for issued letters of credit and outstanding revolving credit borrowings, $55.1 million was available for revolving credit borrowings under the amended senior credit facility at March 31, 2019 . Borrowings under the senior credit facility bore interest at a rate per annum, at the Company’s option, of: (i) the Alternate Base Rate plus the applicable margin of 1.75% to 2.75% based on the Company’s Adjusted Leverage Ratio, or (ii) the LIBOR Rate plus the applicable margin of 2.75% to 3.75% based on the Company’s Adjusted Leverage Ratio (all terms as defined under the senior credit facility). At March 31, 2019 the Company's LIBOR Rate margin was 2.75% and the Alternate Base Rate margin was 1.75% based on the Company's Adjusted Leverage Ratio at the end of the fourth quarter of 2018. The Company’s obligations under the senior credit facility were jointly and severally guaranteed by its subsidiaries and were secured by first priority liens on substantially all of the assets of the Company and its subsidiaries, including a pledge of all of the capital stock and equity interests of its subsidiaries. Under the amended senior credit facility, the Company was required to make mandatory prepayments of borrowings in the event of dispositions of assets, debt issuances and insurance and condemnation proceeds (all subject to certain exceptions). The amended senior credit facility contained certain covenants, including without limitation, those limiting the Company’s and its subsidiaries' ability to, among other things, incur indebtedness, incur liens, sell or acquire assets or businesses, change the character of its business in all material respects, engage in transactions with related parties, make certain investments, make certain restricted payments or pay dividends. In addition, the amended senior credit facility required the Company to meet certain financial ratios, including a Fixed Charge Coverage Ratio, Adjusted Leverage Ratio and First Lien Leverage Ratio (all as defined under the amended senior credit facility). The Company was in compliance with the financial covenants under its senior credit facility at March 31, 2019 . The amended senior credit facility contained customary default provisions, including that the lenders may terminate their obligation to advance and may declare the unpaid balance of borrowings, or any part thereof, immediately due and payable upon the occurrence and during the continuance of customary defaults which include, without limitation, payment default, covenant defaults, bankruptcy type defaults, cross-defaults on other indebtedness, judgments or upon the occurrence of a change of control. |
Income Taxes (Notes)
Income Taxes (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provision (benefit) for income taxes for the three months ended March 31, 2019 and April 1, 2018 was comprised of the following: Three Months Ended March 31, 2019 April 1, 2018 Current $ 12 $ — Deferred 342 (138 ) Provision (benefit) for income taxes $ 354 $ (138 ) Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amount used for income tax purposes. The provision for income taxes for the three months ended March 31, 2019 was derived using an estimated effective annual income tax rate for all of 2019 of (3.1)% , which excludes any discrete tax adjustments and is below the statutory rate due to the effect of fixed employment tax credits on taxable income. The benefits of federal employment credits are not directly related to the amount of pre-tax loss recorded in a period. Accordingly, in periods where recorded pre-tax income (loss) is relatively small, the proportional effect of these items on the effective tax rate may be significant. There were no discrete adjustments for the three months ended March 31, 2019 . The benefit for income taxes for the three months ended April 1, 2018 was derived using an estimated effective annual income tax rate for all of 2018 of 0.6% , which excludes any discrete tax adjustments and was below the statutory rate due to the effect of fixed employment tax credits on taxable income. The income tax benefit for the three months ended April 1, 2018 contains net discrete tax adjustments of $0.1 million of income tax expense. As of March 31, 2019 , the Company had federal net operating loss carryforwards of approximately $89.6 million which expire beginning in 2033 . The Company's state net operating loss carryforwards expire beginning in 2019 through 2038. The Company's policy is to recognize interest and/or penalties related to uncertain tax positions in income tax expense. At March 31, 2019 and December 30, 2018 , the Company had no unrecognized tax benefits and no accrued interest related to uncertain tax positions. The tax years 2013 - 2018 remain open to examination by the major taxing jurisdictions to which the Company is subject. Although it is not reasonably possible to estimate the amount by which unrecognized tax benefits may increase within the next twelve months due to the uncertainties regarding the timing of examinations, the Company does not expect unrecognized tax benefits to significantly change in the next twelve months. |
Stock-Based Compensation (Notes
Stock-Based Compensation (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense for the three months ended March 31, 2019 and April 1, 2018 was $1.5 million and $1.6 million , respectively. On January 15, 2019, the Company granted 417,500 non-vested restricted shares to certain employees and officers of the Company and 47,470 non-vested restricted shares to outside directors of the Company. These shares vest, become non-forfeitable and are being expensed over their three-year vesting period. A summary of all non-vested shares activity for the three months ended March 31, 2019 was as follows: Shares Weighted Average Grant Date Price Non-vested at December 30, 2018 796,476 $ 13.12 Granted 468,199 $ 9.48 Vested (371,824 ) $ 12.68 Non-vested at March 31, 2019 892,851 $ 11.40 The fair value of non-vested shares is based on the closing price on the date of grant. As of March 31, 2019 , the total non-vested unrecognized stock-based compensation expense was approximately $9.0 million and the remaining weighted average vesting period for non-vested shares was 2.1 years. The Company expects to record an additional $4.2 million in stock-based compensation expense related to the vesting of these awards for the remainder of 2019 . |
Commitments And Contingencies (
Commitments And Contingencies (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | Commitments and Contingencies Lease Guarantees. Fiesta Restaurant Group, Inc. ("Fiesta"), a former wholly-owned subsidiary of the Company, was spun-off in 2012 to the Company's stockholders. As of March 31, 2019 , the Company is a guarantor under 27 Fiesta restaurant property leases, of which all except for one of those restaurants is still operating, with lease terms expiring on various dates through 2030, and is the primary lessee on five Fiesta restaurant property leases, which it subleases to Fiesta. The Company is fully liable for all obligations under the terms of the leases in the event that Fiesta fails to pay any sums due under the lease, subject to indemnification provisions of the Separation and Distribution Agreement entered into in connection with the spin-off of Fiesta. The maximum potential amount of future undiscounted rental payments the Company could be required to make under these leases at March 31, 2019 was $15.1 million of which $ 0.6 million is included in operating lease liabilities in accordance with ASC 842. The obligations under these leases will generally continue to decrease over time as these operating leases expire. No payments related to these guarantees have been made by the Company to date and none are expected to be required to be made in the future. The Company has not recorded a liability for $ 14.5 million these guarantees in accordance with ASC 460 - Guarantees as Fiesta has indemnified the Company for all such obligations and the Company did not believe it was probable it would be required to perform under any of the guarantees or direct obligations. Litigation. The Company is a party to various litigation matters that arise in the ordinary course of business. The Company does not believe that the outcome of any of these other matters meet the disclosure or recognition standards, nor will they have a material adverse effect on its consolidated financial statements. |
Transactions with Related Parti
Transactions with Related Parties (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | Transactions with Related Parties In connection with an acquisition of restaurants from BKC in 2012, the Company issued to BKC 100 shares of Series A Convertible Preferred Stock, which was exchanged for 100 shares of newly issued Series B Convertible Preferred Stock in 2018, and as of March 31, 2019 is convertible into approximately 17.5% of the outstanding shares of the Company's common stock after giving effect to the conversion of the Series B Preferred Stock. Pursuant to the terms of the Series B Convertible Preferred Stock, BKC also has two representatives on the Company's board of directors. Each of the Company's restaurants operates under a separate franchise agreement with BKC. These franchise agreements generally provide for an initial term of twenty years and currently have an initial franchise fee of fifty thousand dollars. Any franchise agreement, including renewals, can be extended at the Company's discretion for an additional 20 year term, with BKC's approval, provided that, among other things, the restaurant meets the current Burger King image standard and the Company is not in default under terms of the franchise agreement. In addition to the initial franchise fee, the Company generally pays BKC a monthly royalty at a rate of 4.5 % of sales. Royalty expense was $12.4 million and $11.6 million in the three months ended March 31, 2019 and April 1, 2018 , respectively. The Company is also generally required to contribute 4 % of restaurant sales from its restaurants to an advertising fund utilized by BKC for its advertising, promotional programs and public relations activities, and additional amounts for additional local advertising in markets that approve such advertising. Advertising expense associated with these expenditures was $11.5 million and $10.9 million in the three months ended March 31, 2019 and April 1, 2018 , respectively. As of March 31, 2019 , the Company leased 241 of its restaurant locations from BKC and 116 of these locations are subleased by BKC from a third-party lessor. Aggregate rent under these BKC leases was $6.8 million for each of the three months ended March 31, 2019 and April 1, 2018 , respectively. The Company believes the related party lease terms have not been significantly affected by the fact that the Company and BKC are deemed to be related parties. As of March 31, 2019 , the Company owed BKC $10.2 million related to the payment of advertising, royalties and rent, which is remitted on a monthly basis. In addition, BKC owed the Company $ 1.9 million related to a settlement with BKC for their approval of new restaurant development by other franchisees which unfavorably impacted the Company's restaurants which was recorded as other income and included in trade and other receivables in the unaudited condensed consolidated financial statements at March 31, 2019 . |
Net Loss Per Share (Notes)
Net Loss Per Share (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Loss per Share The Company applies the two-class method to calculate and present net loss per share. The Company's non-vested share awards and Series B Convertible Preferred Stock issued to BKC contain non-forfeitable rights to dividends and are considered participating securities for purposes of computing net loss per share pursuant to the two-class method. Under the two-class method, net earnings are reduced by the amount of dividends declared (whether paid or unpaid) and the remaining undistributed earnings are then allocated to common stock and participating securities, based on their respective rights to receive dividends. As the Company incurred a net loss for the three months ended March 31, 2019 and April 1, 2018 and losses are not allocated to participating securities under the two-class method, such method is not applicable for the aforementioned interim reporting periods. Basic net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of shares of common stock outstanding for the reporting period. Diluted net loss per share reflects additional shares of common stock outstanding, where applicable, calculated using the treasury stock method or the two-class method. The following table sets forth the calculation of basic and diluted net loss per share: Three Months Ended March 31, 2019 April 1, 2018 Basic net loss per share: Net loss $ (11,469 ) $ (3,102 ) Weighted average common shares outstanding 36,045,137 35,665,811 Basic net loss per share $ (0.32 ) $ (0.09 ) Diluted net loss per share: Net loss $ (11,469 ) $ (3,102 ) Shares used in computing diluted net loss per share 36,045,137 35,665,811 Diluted net loss per share $ (0.32 ) $ (0.09 ) Shares excluded from diluted net loss per share computations (1) 10,307,431 10,233,980 (1) Shares issuable upon conversion of preferred stock and non-vested shared were excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive. |
Other Income (Notes)
Other Income (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Other Income and Expenses [Abstract] | |
Other Income | Other Income In the three months ended March 31, 2019 , the Company recorded other income of $ 1.9 million related to a settlement with BKC for their approval of new restaurant development by other franchisees which unfavorably impacted the Company's restaurants, a gain on a sale-leaseback transaction of $0.1 million , and a gain related to an insurance recovery from a fire at one of its restaurants in the prior year of $0.1 million . |
Subsequent Events (Notes)
Subsequent Events (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Subsequent Events The Company reviewed and evaluated subsequent events through the issuance date of the Company’s unaudited condensed consolidated financial statements. Merger Agreement On April 30, 2019, the Company consummated the transaction contemplated by the Agreement and Plan of Merger ("Merger Agreement") dated as of February 19, 2019 among Carrols Restaurant Group, Carrols Holdco, GRC MergerSub Inc. ("GRC MergerSub"), GRC MergerSub LLC, Cambridge Franchise Partners, LLC, Cambridge Franchise Holdings, LLC ("Cambridge Holdings") and New CFH, LLC to acquire 165 Burger King® and 55 Popeyes® restaurants and six convenience stores from Cambridge Holdings (the "Cambridge Acquisition"). Cambridge Holdings received 7,364,413 shares of the Company's common stock, and at closing owned approximately 16.6% of the Company's outstanding common stock. Cambridge Holdings also received 10,000 shares of Series C Convertible Preferred Stock of the Company ("Series C Preferred Stock") which accrues a 9% dividend per annum, payable semi-annually in shares of the Company's common stock and that will initially be convertible into approximately 7.45 million shares of Carrols common stock. The conversion of the Series C Preferred Stock received by Cambridge Holdings will be subject to a vote of the Company's stockholders which will occur at the Company’s 2019 Annual Meeting of Stockholders, and will automatically convert into the Company's common stock upon stockholder approval of such conversion. All shares issued to Cambridge Holdings are subject to a two year restriction on sale or transfer subject to certain limited exceptions. As part of the transaction, Cambridge Holdings will have the right to designate up to two director nominees and two Cambridge Holdings executives joined the Company's Board of Directors on April 30, 2019. Pursuant to the Merger Agreement, on April 30, 2019, the merger of GRC MergerSub and Carrols Restaurant Group, Inc. ("OldCRG") was consummated with OldCRG as the surviving entity (the "Holding Company Reorganization") which resulted in OldCRG becoming a wholly-owned subsidiary of Carrols Holdco Inc. ("NewCRG"). On April 30, 2019, OldCRG was renamed "Carrols Holdco Inc." and NewCRG was renamed "Carrols Restaurant Group, Inc." In connection with the Holding Company Reorganization and by operation of Rule 12g-3(a) promulgated under the Securities Exchange Act of 1934 as amended (the "Exchange Act"), NewCRG is the successor issuer to OldCRG and has succeeded to the attributes of OldCRG as the registrant, including OldCRG’s Securities and Exchange Commission ("SEC") file number and CIK number. Shares of NewCRG Common Stock are deemed to be registered under Section 12(b) of the Exchange Act, and NewCRG is subject to the informational requirements of the Exchange Act, and the rules and regulations promulgated thereunder, and will file reports and other information with the SEC using OldCRG’s SEC file number (001-33174). Shares of NewCRG common stock continue to trade on the NASDAQ Global Market under the symbol “TAST”. The preliminary allocation of the purchase price for the Cambridge Acquisition requires extensive use of accounting estimates and judgments to allocate the purchase price to tangible and intangible assets acquired and liabilities assumed based on their respective fair values. As the values of certain asset and liabilities are preliminary in nature, the fair values for assets acquired and liabilities assumed are subject to adjustment as additional information is obtained. For purposes of a preliminary allocation of the assets acquired and liabilities assumed, the excess of the purchase price over the estimated fair value of net tangible and intangible assets has been assigned to franchise rights. The preliminary fair value of property and equipment, and franchise agreements is based on the assets carrying value due to recent valuations completed by Cambridge Holdings. The amounts allocated to the assets acquired and liabilities assumed are based on management’s preliminary estimates of their respective fair values. Definitive allocations will be performed and finalized, including the completion of valuations of assets acquired and liabilities assumed with the assistance of third party valuation specialists. The following table summarizes the preliminary allocation of the aggregate purchase price for the Cambridge Acquisition and has been derived from the December 30, 2018 balance sheet of Cambridge Holdings: Inventory $ 2,705 Prepaid expenses 2,418 Other assets 11,965 Property and equipment 114,008 Franchise fees 4,175 Franchise rights 207,148 Deferred income taxes 725 Accounts payable (3,557 ) Accrued payroll, related taxes and benefits (3,989 ) Long-term debt (124,879 ) Lease financing obligations (50,839 ) Other liabilities (16,607 ) Net assets acquired $ 143,273 New Credit Facilities On April 30, 2019, the Company entered into a new senior secured credit facility in an aggregate principal amount of $550.0 million , consisting of (i) a term loan B facility in an aggregate principal amount of $425.0 million (the “Term Loan B Facility”) and (ii) a new revolving credit facility (including a sub-facility for standby letters of credit) in an aggregate principal amount of $125.0 million (the “New Revolving Credit Facility” and, together with the Term Loan B Facility, the “New Senior Credit Facilities”). Borrowings under the New Senior Credit Facilities bear interest, at a rate per annum equal to (i) the Alternate Base Rate (as defined in the New Senior Credit Facilities) plus 2.25% or (b) LIBOR Rate (as defined in the New Senior Credit Facilities) plus 3.25% . The Term Loan B Facility will amortize in equal quarterly installments in an aggregate annual amount equal to 1% of the original principal amount of the Term Loan B Facility with the remainder due on the Term Loan B Facility maturing in seven years on April 30, 2026. The New Revolving Credit Facility will mature in five years on April 30, 2024. The proceeds of the Term Loan B Facility were used to refinance the existing indebtedness of (i) the Company and (ii) New CFH and its subsidiaries and (iii) the payment of fees and expenses in connection with the transactions contemplated by the Merger Agreement and New Senior Credit Facilities. The proceeds of the Revolving Credit Facility will be used to finance ongoing working capital and for other general corporate purposes, including permitted acquisitions and required expenditures under development agreements. Area Development and Remodeling Agreement The Company, Carrols, Carrols LLC, and BKC have entered into an Area Development and Remodeling Agreement ("Area Development Agreement") commencing on April 30, 2019 and ending on September 30, 2024, which supersedes the Operating Agreement dated as of May 30, 2012, as amended, between Carrols LLC and BKC. Pursuant to the Area Development Agreement, BKC assigned its right of first refusal under its franchise agreements with its franchisees to purchase all of the assets of a Burger King restaurant on the same terms proposed between such franchisee and a third party purchaser (the “ADA ROFR”), in 16 states and a limited number of counties in four additional states, and granted franchise pre-approval to acquire Burger King restaurants until the date that Carrols LLC has acquired more than an aggregate of 500 Burger King restaurants. The continued assignment of the ADA ROFR is subject to suspension or termination in the event of non-compliance by Carrols LLC with certain terms as set forth in the Area Development Agreement. Carrols LLC will pay BKC $3.0 million for the ADA ROFR in four equal installment payments over the course of one year. Pursuant to the Area Development Agreement, Carrols LLC agreed to open, build and operate 200 new Burger King restaurants and remodel or upgrade 748 Burger King restaurants to BKC’s Burger King of Tomorrow restaurant image over the term of the Area Development Agreement. |
Basis Of Presentation (Policies
Basis Of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation, Policy [Policy Text Block] | Basis of Consolidation. Carrols Restaurant Group is a holding company and conducts all of its operations through its wholly-owned subsidiary, Carrols Holdco Inc. ("Carrols Holdco") and Carrols Holdco's wholly-owned subsidiary, Carrols Corporation (“Carrols”) and Carrols' wholly-owned subsidiary, Carrols LLC, a Delaware limited liability company, and Carrols LLC's wholly-owned subsidiary Republic Foods, Inc., a Maryland corporation ("Republic Foods") . The unaudited condensed consolidated financial statements presented herein include the accounts of Carrols Restaurant Group and its wholly-owned subsidiary Carrols. Unless the context otherwise requires, Carrols Restaurant Group, Carrols Holdco, Carrols, Carrols LLC and Republic Foods, Inc. are collectively referred to as the “Company.” All intercompany transactions have been eliminated in consolidation. |
Fiscal Period, Policy [Policy Text Block] | Fiscal Year. The Company uses a 52 - 53 week fiscal year ending on the Sunday closest to December 31. The three months ended March 31, 2019 and April 1, 2018 each contained thirteen weeks, respectively. |
Basis of Presentation, Policy [Policy Text Block] | Basis of Presentation. The accompanying unaudited condensed consolidated financial statements as of and for the three months ended March 31, 2019 and April 1, 2018 have been prepared without an audit, pursuant to the rules and regulations of the Securities and Exchange Commission and do not include certain of the information and the footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all normal and recurring adjustments considered necessary for a fair presentation of such unaudited condensed consolidated financial statements have been included. The results of operations for the three months ended March 31, 2019 and April 1, 2018 are not necessarily indicative of the results to be expected for the full year. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates. The preparation of the accompanying unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates include: accrued occupancy costs, insurance liabilities, evaluation for impairment of long-lived assets and franchise rights, lease accounting matters, the valuation of acquired assets and liabilities and the valuation of deferred income tax assets. Actual results could differ from those estimates. |
Segment Reporting, Policy [Policy Text Block] | Segment Information. Operating segments are components of an entity for which separate financial information is available and is regularly reviewed by the chief operating decision maker in order to allocate resources and assess performance. The Company's chief operating decision maker currently evaluates the Company's operations from a number of different operational perspectives; however resource allocation decisions are determined based on the chief operating decision maker's evaluation of the total Company operations. The Company derives all significant revenues from a single operating segment. Accordingly, the Company views the operating results of its Burger King ® restaurants as one reportable segment. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. In determining fair value, the accounting standards establish a three level hierarchy for inputs used in measuring fair value as follows: Level 1 inputs are quoted prices in active markets for identical assets or liabilities; Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities; and Level 3 inputs are unobservable and reflect the Company's own assumptions. Financial instruments include cash and cash equivalents, trade and other receivables, accounts payable and long-term debt. The carrying amounts of cash and cash equivalents, trade and other receivables and accounts payable approximate fair value because of the short-term nature of these financial instruments. The fair value of the Carrols Restaurant Group 8.0% Senior Secured Second Lien Notes due 2022 is based on a recent trading value, which is considered Level 2, and at March 31, 2019 and December 30, 2018 was approximately $280.5 million and $277.1 million , respectively. Fair value measurements of non-financial assets and non-financial liabilities are primarily used in the impairment analysis of long-lived assets, goodwill and intangible assets. Long-lived assets and definite-lived intangible assets are measured at fair value on a nonrecurring basis using Level 3 inputs. |
Intangible Assets (Policies)
Intangible Assets (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill. The Company is required to review goodwill for impairment annually, or more frequently when events and circumstances indicate that the carrying amount may be impaired. If the determined fair value of goodwill is less than the related carrying amount, an impairment loss is recognized. The Company performs its annual impairment assessment as of the last day of its fiscal year and does not believe circumstances have changed since the last assessment date which would make it necessary to reassess the value of its goodwill. |
Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block] | Franchise Rights. Amounts allocated to franchise rights for each acquisition of Burger King ® restaurants are amortized using the straight-line method over the average remaining term of the acquired franchise agreements plus one twenty -year renewal period. |
Impairment Of Long-Lived Asse_2
Impairment Of Long-Lived Assets And Other Lease Charges (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Asset Impairment Charges [Abstract] | |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | The Company reviews its long-lived assets, principally property and equipment, for impairment at the restaurant level. If an indicator of impairment exists for any of its assets, an estimate of the undiscounted future cash flows over the life of the primary asset for each restaurant is compared to that long-lived asset’s carrying value. If the carrying value is greater than the undiscounted cash flow, the Company then determines the fair value of the asset and if an asset is determined to be impaired, the loss is measured by the excess of the carrying amount of the asset over its fair value. For closed restaurant locations, the Company reviews the future minimum lease payments and related ancillary costs from the date of the restaurant closure to the end of the remaining lease term and records a lease charge for the lease liabilities to be incurred, net of any estimated sublease recoveries. The Company determines the fair value of restaurant equipment, for those restaurants reviewed for impairment, based on current economic conditions and the Company’s history of transferring these assets in the operation of its business. The Company determines the fair value of right-of-use lease assets based on an assessment of market rents and a discounted future cash flow model. These fair value asset measurements rely on significant unobservable inputs and are considered Level 3 in the fair value hierarchy. |
Stock-Based Compensation Polici
Stock-Based Compensation Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation Costs, Policy [Policy Text Block] | The fair value of non-vested shares is based on the closing price on the date of grant. |
Net Loss Per Share (Policies)
Net Loss Per Share (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share, Policy [Policy Text Block] | The Company applies the two-class method to calculate and present net loss per share. The Company's non-vested share awards and Series B Convertible Preferred Stock issued to BKC contain non-forfeitable rights to dividends and are considered participating securities for purposes of computing net loss per share pursuant to the two-class method. Under the two-class method, net earnings are reduced by the amount of dividends declared (whether paid or unpaid) and the remaining undistributed earnings are then allocated to common stock and participating securities, based on their respective rights to receive dividends. As the Company incurred a net loss for the three months ended March 31, 2019 and April 1, 2018 and losses are not allocated to participating securities under the two-class method, such method is not applicable for the aforementioned interim reporting periods. Basic net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of shares of common stock outstanding for the reporting period. Diluted net loss per share reflects additional shares of common stock outstanding, where applicable, calculated using the treasury stock method or the two-class method. |
Acquisition (Tables)
Acquisition (Tables) | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Business Acquisition [Line Items] | ||
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | Since the beginning of 2018, the Company has acquired an aggregate of 44 restaurants from other franchisees in the following transactions, some of which were subject to the ROFR (in thousands, except number of restaurants): Closing Date Number of Restaurants Purchase Price Market Location February 13, 2018 (1) 1 $ — New York August 21, 2018 (2) 2 1,666 Detroit, Michigan September 5, 2018 (2) 31 25,930 Western Virginia October 2, 2018 10 10,506 South Carolina and Georgia 44 $ 38,102 (1) During the first quarter of 2018, the allocation of the purchase price and the resulting bargain purchase gain for this acquisition was preliminary and subject to adjustment. Specifically, the Company was finalizing the valuation of franchise rights which will impact the amount of the bargain purchase gain. In the second quarter of 2018, the Company recorded a bargain purchase gain because the fair value of assets acquired, largely representing a franchise right asset of $0.3 million , exceeded the total fair value of consideration paid by $0.2 million . (2) Acquisitions resulting from the exercise of the ROFR. The following table summarizes the preliminary allocation of the aggregate purchase price for the 2018 acquisitions reflected in the condensed consolidated balance sheets as of December 30, 2018 . Inventory $ 401 Restaurant equipment 2,092 Restaurant equipment - subject to finance leases 43 Leasehold improvements 1,329 Franchise fees 1,264 Franchise rights (Note 3) 31,275 Favorable leases (Note 3) 587 Deferred income taxes 346 Goodwill (Note 3) 1,677 Finance lease liabilities for restaurant equipment (49 ) Unfavorable leases (Note 3) (624 ) Accounts payable (9 ) Net assets acquired $ 38,332 | |
Business Acquisition, Pro Forma Information [Table Text Block] | The following table summarizes the Company's unaudited pro forma operating results: Three Months Ended March 31, 2019 April 1, 2018 Restaurant sales $ 290,789 $ 284,817 Net loss $ (11,469 ) $ (2,269 ) Basic and diluted net loss per share $ (0.32 ) $ (0.06 ) |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Indefinite-Lived Intangible Assets [Table Text Block] | The change in franchise rights for the three months ended March 31, 2019 is summarized below: Balance at December 30, 2018 $ 175,897 Amortization expense (2,030 ) Balance at March 31, 2019 $ 173,867 |
Impairment Of Long-Lived Asse_3
Impairment Of Long-Lived Assets And Other Lease Charges (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Asset Impairment Charges [Abstract] | |
Schedule of Closed-Store Restaurant Reserve by Type of Cost [Table Text Block] | The following table presents the activity in the accrual for closed restaurant locations: Three Months Ended Year Ended March 31, 2019 December 30, 2018 Balance, beginning of period $ 1,352 $ 2,028 Provisions for closures 41 249 Changes in estimates of accrued costs (11 ) (147 ) Payments, net (144 ) (889 ) Other adjustments, including the effect of discounting future obligations 23 111 Balance, end of period $ 1,261 $ 1,352 |
Other Liabilities, Long-Term (T
Other Liabilities, Long-Term (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Other Liabilities, Noncurrent [Abstract] | |
Schedule of Other Assets and Other Liabilities [Table Text Block] | Other liabilities, long-term, at March 31, 2019 and December 30, 2018 consisted of the following: March 31, 2019 December 30, 2018 Deferred rent $ — $ 16,610 Unfavorable leases, net 28 12,348 Accrual for closed restaurants, long-term 442 3,074 Accrued workers’ compensation and general liability claims 3,429 4,398 Deferred compensation 3,644 3,610 Other 120 120 $ 7,663 $ 40,160 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases, Balance Sheet Supplemental [Table Text Block] | Supplemental balance sheet information related to leases was as follows: As of Leases Classification March 31, 2019 Assets Operating leases Operating right-of-use assets, net $ 525,008 Finance leases Property and equipment, net 2,663 Total leased assets $ 527,671 Liabilities Current Operating leases Current portion of operating lease liabilities $ 32,732 Finance leases Current portion of long-term debt and finance lease liabilities 1,969 Long-term Operating leases Operating lease liabilities 518,113 Finance leases Long-term debt and finance lease liabilities, net 1,496 Total lease liabilities $ 554,310 Weighted Average Remaining Lease Term Operating leases 13.7 years Finance leases 1.9 years Weighted Average Discount Rate Operating leases 7.0 % Finance leases 7.4 % |
Lease, Cost [Table Text Block] | The components and classification of lease expense for the three months ended March 31, 2019 are as follows: Three Months Ended Lease cost Classification March 31, 2019 Operating lease cost (1) Rent expense $ 18,294 Variable lease cost Rent expense 3,800 Sublease income Rent expense (178 ) Finance lease cost: Amortization of right-of-use assets Depreciation and amortization 476 Interest on lease liabilities Interest expense 71 Total lease cost $ 22,463 (1) Includes short-term leases, which are not material. |
Leases, Cash Flows Supplemental [Table Text Block] | Supplemental cash flow information related to leases was as follows: Three Months Ended March 31, 2019 Gain on sale-leaseback transactions $ 93 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 17,366 Operating cash flows from finance leases $ 71 Financing cash flows from finance leases $ 476 |
Finance Lease, Liability, Maturity [Table Text Block] | Three Months Ended March 31, 2019 Gain on sale-leaseback transactions $ 93 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 17,366 Operating cash flows from finance leases $ 71 Financing cash flows from finance leases $ 476 Undiscounted Cash Flows Maturities of lease liabilities were as follows: |
Lessee, Operating Lease, Liability, Maturity [Table Text Block] | Three Months Ended March 31, 2019 Gain on sale-leaseback transactions $ 93 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 17,366 Operating cash flows from finance leases $ 71 Financing cash flows from finance leases $ 476 Undiscounted Cash Flows Maturities of lease liabilities were as follows: |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, the maturities of lease liabilities at December 30, 2018 were as follows: Fiscal year ending: Operating Leases Capital Leases December 29, 2019 $ 73,304 $ 2,180 January 3, 2021 71,764 1,454 January 2, 2022 70,607 345 January 1, 2023 70,160 190 December 31, 2023 69,221 68 Thereafter 640,793 129 Total minimum lease payments $ 995,849 4,366 Less amount representing interest (425 ) Total obligations under capital leases 3,941 Less current portion (1,948 ) Long-term obligations under capital leases $ 1,993 |
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | Leases The Company utilizes land and buildings in its operations under various lease agreements. The Company does not consider any one of these individual leases material to the Company's operations. Initial lease terms are generally for twenty years and, in many cases, provide for renewal options and in most cases rent escalations. Certain leases require contingent rent, determined as a percentage of sales as defined by the terms of the applicable lease agreement. For most locations, the Company is obligated for occupancy related costs including payment of property taxes, insurance and utilities. Right-of-use (“ROU”) lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make payments in exchange for that right of use. Operating lease ROU assets are presented as operating right-of-use assets, net, the current portion of operating lease liabilities are presented as current portion of operating lease liabilities, and the non-current portion of operating lease liabilities are presented as operating lease liabilities in the condensed consolidated balance sheets. The current portion of operating lease liabilities was $ 32.7 million as of March 31, 2019. Leases with a term of 12 months or less are not recorded on the balance sheet. The discount rate implicit within our leases is generally not readily determinable, and therefore, the Company uses its estimated incremental borrowing rate in determining the present value of lease payments. The incremental borrowing rate considers the Company’s recent debt issuances and lease term. The Company’s real estate leases often contain options to renew, and less frequently, termination options. The exercise of such renewal and termination options are generally at the Company’s sole discretion. The Company evaluates renewal and termination options at lease commencement to determine if such options are reasonably certain to be exercised based on economic factors. As of March 31, 2019 , the Company had additional leases that have not yet commenced of $9.2 million . These leases will commence between fiscal 2019 and 2020 with lease terms of 15 years to 20 years. In addition, the Company utilizes certain restaurant equipment under various finance lease agreements. The Company does not consider any one of these individual leases material to the Company's operations. Initial lease terms are generally eight years. Leases with an initial term of 12 months or less are not recorded on the balance sheet and are recognized as lease expense on a straight-line basis over the lease term. The Company does not account for lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) separately from the non-lease components. Lease Position Supplemental balance sheet information related to leases was as follows: As of Leases Classification March 31, 2019 Assets Operating leases Operating right-of-use assets, net $ 525,008 Finance leases Property and equipment, net 2,663 Total leased assets $ 527,671 Liabilities Current Operating leases Current portion of operating lease liabilities $ 32,732 Finance leases Current portion of long-term debt and finance lease liabilities 1,969 Long-term Operating leases Operating lease liabilities 518,113 Finance leases Long-term debt and finance lease liabilities, net 1,496 Total lease liabilities $ 554,310 Weighted Average Remaining Lease Term Operating leases 13.7 years Finance leases 1.9 years Weighted Average Discount Rate Operating leases 7.0 % Finance leases 7.4 % For certain leases where rent escalates based upon a change in a financial index, such as the Consumer Price Index, the difference between the rate at lease inception and the subsequent fluctuations in that rate are included in variable lease costs. Additionally, because the Company has elected to not separate lease and non-lease components, in limited instances, variable costs also include payments to the landlord for common area maintenance, real estate taxes, insurance and other operating expenses. Lease expense is recognized on a straight-line basis over the lease term, with variable lease payments recognized in the period those payments are incurred. Lease Cost The components and classification of lease expense for the three months ended March 31, 2019 are as follows: Three Months Ended Lease cost Classification March 31, 2019 Operating lease cost (1) Rent expense $ 18,294 Variable lease cost Rent expense 3,800 Sublease income Rent expense (178 ) Finance lease cost: Amortization of right-of-use assets Depreciation and amortization 476 Interest on lease liabilities Interest expense 71 Total lease cost $ 22,463 (1) Includes short-term leases, which are not material. Other Information Supplemental cash flow information related to leases was as follows: Three Months Ended March 31, 2019 Gain on sale-leaseback transactions $ 93 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 17,366 Operating cash flows from finance leases $ 71 Financing cash flows from finance leases $ 476 Undiscounted Cash Flows Maturities of lease liabilities were as follows: Fiscal year ending: Operating Leases Finance Leases December 29, 2019 $ 52,148 $ 1,633 January 3, 2021 66,866 1,454 January 2, 2022 65,139 345 January 1, 2023 64,211 190 December 31, 2023 62,836 68 Thereafter 558,864 129 Total minimum lease payments 870,064 3,819 Less: imputed interest (319,219 ) (354 ) Present value of lease liabilities 550,845 3,465 Less: current portion (32,732 ) (1,969 ) Total long-term lease liabilities $ 518,113 $ 1,496 Disclosures Related to Periods Prior to Adoption of the New Lease Standard As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, the maturities of lease liabilities at December 30, 2018 were as follows: Fiscal year ending: Operating Leases Capital Leases December 29, 2019 $ 73,304 $ 2,180 January 3, 2021 71,764 1,454 January 2, 2022 70,607 345 January 1, 2023 70,160 190 December 31, 2023 69,221 68 Thereafter 640,793 129 Total minimum lease payments $ 995,849 4,366 Less amount representing interest (425 ) Total obligations under capital leases 3,941 Less current portion (1,948 ) Long-term obligations under capital leases $ 1,993 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Long-term Debt, Unclassified [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | Long-term debt at March 31, 2019 and December 30, 2018 consisted of the following: March 31, 2019 December 30, 2018 Collateralized: Carrols Restaurant Group 8% Senior Secured Second Lien Notes $ 275,000 $ 275,000 Prior Senior Credit Facility - Revolving credit borrowings 6,250 — Finance lease liabilities 3,465 3,941 284,715 278,941 Less: current portion of finance lease liabilities (1,969 ) (1,948 ) Less: deferred financing costs (3,756 ) (3,673 ) Add: bond premium 3,266 3,503 Total Long-term debt $ 282,256 $ 276,823 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | The provision (benefit) for income taxes for the three months ended March 31, 2019 and April 1, 2018 was comprised of the following: Three Months Ended March 31, 2019 April 1, 2018 Current $ 12 $ — Deferred 342 (138 ) Provision (benefit) for income taxes $ 354 $ (138 ) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Nonvested Share Activity [Table Text Block] | A summary of all non-vested shares activity for the three months ended March 31, 2019 was as follows: Shares Weighted Average Grant Date Price Non-vested at December 30, 2018 796,476 $ 13.12 Granted 468,199 $ 9.48 Vested (371,824 ) $ 12.68 Non-vested at March 31, 2019 892,851 $ 11.40 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table sets forth the calculation of basic and diluted net loss per share: Three Months Ended March 31, 2019 April 1, 2018 Basic net loss per share: Net loss $ (11,469 ) $ (3,102 ) Weighted average common shares outstanding 36,045,137 35,665,811 Basic net loss per share $ (0.32 ) $ (0.09 ) Diluted net loss per share: Net loss $ (11,469 ) $ (3,102 ) Shares used in computing diluted net loss per share 36,045,137 35,665,811 Diluted net loss per share $ (0.32 ) $ (0.09 ) Shares excluded from diluted net loss per share computations (1) 10,307,431 10,233,980 (1) Shares issuable upon conversion of preferred stock and non-vested shared were excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive. |
Subsequent Events (Tables)
Subsequent Events (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | The following table summarizes the preliminary allocation of the aggregate purchase price for the Cambridge Acquisition and has been derived from the December 30, 2018 balance sheet of Cambridge Holdings: Inventory $ 2,705 Prepaid expenses 2,418 Other assets 11,965 Property and equipment 114,008 Franchise fees 4,175 Franchise rights 207,148 Deferred income taxes 725 Accounts payable (3,557 ) Accrued payroll, related taxes and benefits (3,989 ) Long-term debt (124,879 ) Lease financing obligations (50,839 ) Other liabilities (16,607 ) Net assets acquired $ 143,273 |
Basis Of Presentation (Details)
Basis Of Presentation (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2019USD ($)segmentRate | Apr. 01, 2018USD ($) | Dec. 29, 2019 | Dec. 31, 2018USD ($) | Dec. 30, 2018USD ($) | |
Entity Information [Line Items] | |||||
Number of Restaurants | 845 | ||||
Number of States in which Entity Operates | 18 | ||||
Weeks In Fiscal Period | 13 | 13 | |||
Number of Reportable Segments | segment | 1 | ||||
Cash Equivalents, at Carrying Value | $ 2,300 | ||||
Senior Secured Second Lien Notes, Interest Rate | Rate | 8.00% | ||||
Long-term Debt, Fair Value | $ 280,500 | 277,100 | |||
Asset impairment charges | 900 | $ 100 | |||
Operating leases | 525,008 | 0 | |||
Present value of lease liabilities | $ 550,845 | ||||
Minimum [Member] | |||||
Entity Information [Line Items] | |||||
Weeks In Fiscal Period | 52 | ||||
Maximum [Member] | |||||
Entity Information [Line Items] | |||||
Weeks In Fiscal Period | 53 | ||||
Subsequent Event [Member] | |||||
Entity Information [Line Items] | |||||
Weeks In Fiscal Period | 52 | ||||
Accounting Standards Update 2016-02 [Member] | |||||
Entity Information [Line Items] | |||||
Operating leases | 517,600 | ||||
Present value of lease liabilities | $ 542,900 | ||||
Adoption of ASC 842, net of taxes | $ 7,504 | ||||
Accounting Standards Update 2016-02 [Member] | Retained Earnings [Member] | |||||
Entity Information [Line Items] | |||||
Adoption of ASC 842, net of taxes | $ 7,504 |
Acquisition (Details)
Acquisition (Details) | Oct. 02, 2018USD ($) | Sep. 05, 2018USD ($) | Aug. 21, 2018USD ($) | Feb. 13, 2018USD ($) | Mar. 31, 2019USD ($) | Apr. 01, 2018USD ($) | Mar. 31, 2019USD ($) | Dec. 30, 2018USD ($) | Jul. 01, 2018USD ($) |
Business Acquisition [Line Items] | |||||||||
Right of First Refusal, Number of States | 20 | 20 | |||||||
Number of Restaurants Acquired | 44 | ||||||||
Business acquisitions, purchase price | $ 38,102,000 | ||||||||
Proceeds from sale-leaseback transactions | $ 2,302,000 | $ 1,292,000 | |||||||
Restaurant sales | 290,789,000 | 271,586,000 | |||||||
Goodwill | 38,469,000 | $ 38,469,000 | $ 38,469,000 | ||||||
2018 Acquisitions [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill | $ 1,677,000 | ||||||||
February 13, 2018 Acquisition 2 [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Number of Restaurants Acquired | 1 | ||||||||
Business acquisitions, purchase price | $ 0 | ||||||||
Franchise rights | $ 300,000 | ||||||||
Liabilities assumed in excess of consideration | $ 200,000 | ||||||||
August 21, 2018 Acquisition 2 [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Number of Restaurants Acquired | 2 | ||||||||
Business acquisitions, purchase price | $ 1,666,000 | ||||||||
September 5, 2018 Acquisition 2 [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Number of Restaurants Acquired | 31 | ||||||||
Business acquisitions, purchase price | $ 25,930,000 | ||||||||
October 2, 2018 Acquisition [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Number of Restaurants Acquired | 10 | ||||||||
Business acquisitions, purchase price | $ 10,506,000 | ||||||||
Acquired Restaurants [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Restaurant sales | $ 13,000,000 | $ 100,000 |
Acquisition Net Assets Acquired
Acquisition Net Assets Acquired (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 30, 2018 |
Business Acquisition [Line Items] | ||
Goodwill | $ 38,469 | $ 38,469 |
2018 Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Inventory | 401 | |
Restaurant equipment | 2,092 | |
Restaurant equipment - subject to finance leases | 43 | |
Leasehold improvements | 1,329 | |
Franchise fees | 1,264 | |
Franchise rights | 31,275 | |
Favorable leases | 587 | |
Deferred income taxes | 346 | |
Goodwill | 1,677 | |
Finance lease liabilities for restaurant equipment | (49) | |
Unfavorable leases | (624) | |
Accounts payable | (9) | |
Net assets acquired | $ 38,332 |
Acquisition Pro Forma Informati
Acquisition Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Business Combinations [Abstract] | ||
Business Acquisition, Pro Forma Restaurant Sales | $ 290,789 | $ 284,817 |
Business Acquisition, Pro Forma Net Income (Loss) | $ (11,469) | $ (2,269) |
Business Acquisition, Pro Forma Earnings Per Share, Basic and Diluted | $ (0.32) | $ (0.06) |
Acquisition costs | $ 100 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill, Impairment Loss | $ 0 | $ 0 |
Franchise Rights (Details)
Franchise Rights (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Franchise agreement, term | 20 years | |
Franchise RIghts Rollforward [Abstract] | ||
Balance, beginning | $ 175,897 | |
Amortization of intangible assets, franchise rights | (2,030) | $ (1,800) |
Balance, end | 173,867 | |
Franchise Rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Impairment of intangible assets (excluding goodwill) | 0 | $ 0 |
Franchise RIghts Rollforward [Abstract] | ||
Amortization expense, expected for full fiscal period | 8,100 | |
Amortization expense, next twelve months | 8,100 | |
Second Fiscal Year | 8,100 | |
Third Fiscal Year | 8,100 | |
Fourth Fiscal Year | 8,100 | |
Fifth Fiscal Year | $ 8,100 |
Impairment Of Long-Lived Asse_4
Impairment Of Long-Lived Assets And Other Lease Charges (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($) | Apr. 01, 2018USD ($) | |
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment and other lease charges | $ 910 | $ 309 |
Gain on sale-leaseback transactions | $ 93 | $ 100 |
Underperforming Restaurants [Member] | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Asset impairment charges, number of restaurants | 2 | |
Closed Restaurants [Member] | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Asset impairment charges, number of restaurants | 6 | 2 |
Previously Impaired [Member] | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment and other lease charges | $ 141 | |
Changes in Future Costs [Member] | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment and other lease charges | $ 116 | |
Initial Impairment Charge [Member] | Underperforming Restaurants [Member] | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment and other lease charges | $ 710 | |
Previously Impairment Restaurants [Member] | Underperforming Restaurants [Member] | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment and other lease charges | 149 | |
Other Lease Charges [Member] | Underperforming Restaurants [Member] | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment and other lease charges | $ 51 |
Impairment Of Long-Lived Asse_5
Impairment Of Long-Lived Assets And Other Lease Charges Closed Restaurant Reserve Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2017 | |
Restructuring Reserve [Roll Forward] | ||
Closed-restaurant reserve, beginning of the period | $ 1,352 | |
Provisions for restaurant closures | 41 | $ 249 |
Changes in estimates of accrued costs | (11) | (147) |
Payments, net | (144) | (889) |
Other adjustments, including the effect of discounting future obligations | 23 | 111 |
Closed-restaurant reserve, end of the period | $ 1,261 | $ 2,028 |
Other Liabilities, Long-Term (D
Other Liabilities, Long-Term (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Dec. 30, 2018 |
Other Liabilities, Noncurrent [Abstract] | |||
Deferred rent | $ 0 | $ 16,610 | |
Unfavorable leases, net | 28 | 12,348 | |
Accrual for closed restaurants, long-term | 442 | 3,074 | |
Accrued workers' compensation and general liability claims | 3,429 | 4,398 | |
Deferred compensation | 3,644 | 3,610 | |
Other | 120 | 120 | |
Other Liabilities | 7,663 | 40,160 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Unfavorable leases, accumulated amortization | $ 6,019 | $ 6,075 | |
Accounting Standards Update 2016-02 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Unfavorable leases, accumulated amortization | $ 12,300 | ||
Deferred Rent, Noncurrent | 16,600 | ||
Unamortized Lease Incentives, Noncurrent | $ 2,600 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 30, 2018 | |
Leases [Abstract] | ||
Lessee, operating lease, term of contract | 20 years | |
Less: current portion | $ 32,732 | $ 0 |
Lessor, Lease, Description [Line Items] | ||
Lessor, operating lease, lease not yet commenced, assumption and judgment, value of underlying asset, amount | $ 9,200 | |
Minimum [Member] | ||
Lessor, Lease, Description [Line Items] | ||
Lessee, operating lease, lease not yet commenced, term of contract | 15 years | |
Maximum [Member] | ||
Lessor, Lease, Description [Line Items] | ||
Lessee, operating lease, lease not yet commenced, term of contract | 20 years |
Leases - Position (Details)
Leases - Position (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 30, 2018 | |
Leases [Abstract] | ||
Operating leases | $ 525,008 | $ 0 |
Finance leases | 2,663 | |
Total leased assets | 527,671 | |
Current, Operating leases | 32,732 | 0 |
Less: current portion | 1,969 | |
Operating lease liabilities | 518,113 | $ 0 |
Long-term, Finance leases | 1,496 | |
Total lease liabilities | $ 554,310 | |
Weighted Average Remaining Lease Term, Operating Lease | 13 years 8 months 12 days | |
Weighted Average Remaining Lease Term, Finance Lease | 1 year 10 months 25 days | |
Weighted Average Discount Rate, Operating Leases | 7.00% | |
Weighted Average Discount Rate, Finance Leases | 7.40% |
Leases - Cost (Details)
Leases - Cost (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 18,294 |
Variable lease cost | 3,800 |
Sublease income | (178) |
Amortization of right-of-use assets | 476 |
Interest on lease liabilities | 71 |
Total lease cost | $ 22,463 |
Leases - Other Information (Det
Leases - Other Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Leases [Abstract] | ||
Gain on sale-leaseback transactions | $ 93 | $ 100 |
Operating cash flows from operating leases | 17,366 | |
Operating cash flows from finance leases | 71 | |
Financing cash flows from finance leases | $ 476 | $ 440 |
Leases - Maturities Of Lease Li
Leases - Maturities Of Lease Liabilities 842 (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 30, 2018 |
Operating Leases | ||
December 29, 2019 | $ 52,148 | |
January 3, 2021 | 66,866 | |
January 2, 2022 | 65,139 | |
January 1, 2023 | 64,211 | |
December 31, 2023 | 62,836 | |
Thereafter | 558,864 | |
Total minimum lease payments | 870,064 | |
Less: imputed interest | (319,219) | |
Present value of lease liabilities | 550,845 | |
Less: current portion | (32,732) | $ 0 |
Total long-term lease liabilities | 518,113 | $ 0 |
Finance Leases | ||
December 29, 2019 | 1,633 | |
January 3, 2021 | 1,454 | |
January 2, 2022 | 345 | |
January 1, 2023 | 190 | |
December 31, 2023 | 68 | |
Thereafter | 129 | |
Total minimum lease payments | 3,819 | |
Less: imputed interest | (354) | |
Present value of lease liabilities | 3,465 | |
Less: current portion | (1,969) | |
Total long-term lease liabilities | $ 1,496 |
Leases - Maturities Of Lease _2
Leases - Maturities Of Lease Liabilities 840 (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 30, 2018 |
Capital Leases | ||
December 29, 2019 | $ 73,304 | |
January 3, 2021 | 71,764 | |
January 2, 2022 | 70,607 | |
January 1, 2023 | 70,160 | |
December 31, 2023 | 69,221 | |
Thereafter | 640,793 | |
Total minimum lease payments | 995,849 | |
Operating Leases | ||
December 29, 2019 | 2,180 | |
January 3, 2021 | 1,454 | |
January 2, 2022 | 345 | |
January 1, 2023 | 190 | |
December 31, 2023 | 68 | |
Thereafter | 129 | |
Total minimum lease payments | 4,366 | |
Less amount representing interest | (425) | |
Total obligations under capital leases | $ 3,465 | 3,941 |
Less current portion | (1,948) | |
Long-term obligations under capital leases | $ 1,993 |
Long-Term Debt Debt Balances (D
Long-Term Debt Debt Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Apr. 01, 2018 | Jun. 28, 2015 | Mar. 31, 2019 | Dec. 30, 2018 | |
Debt Disclosure [Abstract] | ||||
Proceeds from Issuance of Debt | $ 75,000 | $ 200,000 | ||
Carrols Restaurant Group Senior Secured Second Lien Notes | $ 275,000 | $ 275,000 | ||
Senior Credit Facility - Revolving credit borrowings | 6,250 | 0 | ||
Total obligations under capital leases | 3,465 | 3,941 | ||
Long-term Debt | 284,715 | 278,941 | ||
Less: current portion | (1,969) | (1,948) | ||
Less: deferred financing costs | (3,756) | (3,673) | ||
Add: bond premium | 3,266 | 3,503 | ||
Long-term debt, net of current portion | $ 282,256 | $ 276,823 |
Long-Term Debt Senior Secured S
Long-Term Debt Senior Secured Second Lien Notes (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019 | Apr. 01, 2018 | Jun. 28, 2015 | Dec. 30, 2018 | |
Debt Instrument, Redemption [Line Items] | ||||
Carrols Restaurant Group Senior Secured Second Lien Notes | $ 275,000 | $ 275,000 | ||
Senior Secured Second Lien Notes, Interest Rate | 8.00% | |||
Proceeds from Issuance of Debt | $ 75,000 | $ 200,000 | ||
Debt Issuance Costs, Net | $ 3,756 | $ 3,673 | ||
Collateral exclusion for material subsidiaries, percentage of Senior Notes | 20.00% | |||
Senior Notes, Cross Default Provision, Minimum Debt Principal Amount | $ 20,000 | |||
Debt Instrument, Redemption, Period Two [Member] | ||||
Debt Instrument, Redemption [Line Items] | ||||
Senior Notes, Redemption Price | 104.00% | |||
Debt Instrument, Redemption, Period Three [Member] | ||||
Debt Instrument, Redemption [Line Items] | ||||
Senior Notes, Redemption Price | 102.00% | |||
Debt Instrument, Redemption, Period Four [Member] | ||||
Debt Instrument, Redemption [Line Items] | ||||
Senior Notes, Redemption Price | 100.00% |
Long-Term Debt Senior Credit Fa
Long-Term Debt Senior Credit Facility (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 30, 2018 | Apr. 01, 2018 |
Debt Instrument [Line Items] | |||
Permitted indebtedness | $ 300,000 | ||
Line of Credit Facility, Current Borrowing Capacity | 73,000 | ||
Line of Credit Facility, Potential Incremental Increases | 25,000 | ||
Senior Credit Facility - Revolving credit borrowings | 6,250 | $ 0 | |
Letters of Credit Outstanding, Amount | 11,600 | ||
Line of Credit Facility, Remaining Borrowing Capacity | 55,100 | ||
Letter of Credit [Member] | |||
Debt Instrument [Line Items] | |||
Line of Credit Facility, Current Borrowing Capacity | $ 20,000 | ||
Alternative Base Rate [Member] | |||
Debt Instrument [Line Items] | |||
Line of Credit Facility, Interest Rate | 1.75% | ||
Alternative Base Rate [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 1.75% | ||
Alternative Base Rate [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 2.75% | ||
London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument [Line Items] | |||
Line of Credit Facility, Interest Rate | 2.75% | ||
London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 2.75% | ||
London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 3.75% |
Income Taxes Schedule of Compon
Income Taxes Schedule of Components of Income Tax Expense (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Income Tax Disclosure [Abstract] | ||
Current | $ 12,000 | $ 0 |
Deferred | 342,000 | (138,000) |
Provision (benefit) for income taxes | $ 354,000 | $ (138,000) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Apr. 01, 2018 | Dec. 30, 2018 | |
Income Tax Disclosure [Abstract] | |||
Effective Income Tax Rate Reconciliation, Percent | (3.10%) | 0.60% | |
Effective Income Tax Rate Reconciliation, Tax Credit, Other, Amount | $ 0 | ||
Operating Loss Carryforwards | 89,600 | ||
Unrecognized Tax Benefits | 0 | $ 0 | |
Unrecognized Tax Benefits, Interest on Income Taxes Accrued | $ 0 | $ 0 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Apr. 01, 2018 | Jan. 15, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 1,526 | $ 1,585 | |
Unrecognized Stock-Based Compensation Expense, Non-vested Shares | $ 9,000 | ||
Weighted Average Remaining Vesting Period, Non-Vested Shares | 2 years 1 month 12 days | ||
Expected Stock-Based Compensation, Remainder of Fiscal Year | $ 4,200 | ||
Certain Employees and Officers [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 417,500 | ||
Outside Directors [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 47,470 |
Stock-Based Compensation Summar
Stock-Based Compensation Summary of Non-Vested Stock Activity (Details) | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Nonvested share activity [Roll Forward] | |
Nonvested, beginning of period | shares | 796,476 |
Weighted Average Grant Date Price, beginning of period | $ / shares | $ 13.12 |
Granted | shares | 468,199 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ / shares | $ 9.48 |
Vested Shares | shares | 371,824 |
Weighted Average Grant Date Price, Vested Shares | $ / shares | $ 12.68 |
Nonvested, end of period | shares | 892,851 |
Weighted Average Grant Date Price, end of period | $ / shares | $ 11.40 |
Commitments And Contingencies_2
Commitments And Contingencies (Details) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Guarantor Obligations [Line Items] | |
Maximum potential future undiscounted rental payments | $ 15,100,000 |
Guarantor Obligations, Payments Made | 0 |
Guarantor Obligations, Expected Future Payments | $ 0 |
Property Lease Guarantee [Member] | |
Guarantor Obligations [Line Items] | |
Property leases | 27 |
Property leases, still in operation | 1 |
Primary Lessee [Member] | |
Guarantor Obligations [Line Items] | |
Property leases | 5 |
Transactions with Related Par_2
Transactions with Related Parties (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)Rateshares | Dec. 30, 2018shares | |
Related Party Transaction [Line Items] | ||
Preferred stock, shares issued | shares | 100 | 100 |
Board of directors, number of members | 2 | |
Franchise agreement, term | 20 years | |
Accounts payable to BKC | $ 10,200 | |
Arbitration Settlement | $ 1,900 | |
Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Preferred stock, ownership percentage if converted | Rate | 17.50% | |
Initial Franchise Fees | $ 50 | |
Franchise Term | 20 years | |
Property leases | 241 | |
BKC Subleases with third-party lessor [Member] | Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Property leases | 116 |
Transactions with Related Par_3
Transactions with Related Parties Expense Disclosures (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2019USD ($)Rate | Apr. 01, 2018USD ($) | |
Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Royalty Expense | $ 12.4 | $ 11.6 |
Advertising Expense | $ 11.5 | $ 10.9 |
Property leases | 241 | |
Operating Leases, Rent Expense | $ 6.8 | |
Selling and Marketing Expense [Member] | Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Transaction, Rate | Rate | 4.00% | |
Royalty Agreement Terms [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Transaction, Rate | Rate | 4.50% | |
BKC Subleases with third-party lessor [Member] | Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Property leases | 116 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Apr. 01, 2018 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Net income | $ (11,469) | $ (3,102) |
Weighted Average Number of Shares Outstanding, Basic | 36,045,137 | 35,665,811 |
Basic net income (loss) per share | $ (0.32) | $ (0.09) |
Shares used in computing diluted net income (loss) per share | 36,045,137 | 35,665,811 |
Diluted net income (loss) per share | $ (0.32) | $ (0.09) |
Shares excluded from diluted net loss per share computations | 10,307,431 | 10,233,980 |
Other Income (Details)
Other Income (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Other Income and Expenses [Abstract] | |
Gain on insurance recovery | $ 0.1 |
Subsequent Events (Details)
Subsequent Events (Details) shares in Thousands | Dec. 31, 2024 | Apr. 30, 2019USD ($)staterestaurantRate | Feb. 20, 2019restaurantdirectorshares | Apr. 01, 2018USD ($) | Jun. 28, 2015USD ($) | May 20, 2024USD ($) | May 01, 2019staterestaurant | Mar. 31, 2019Rate |
Subsequent Event [Line Items] | ||||||||
Number of Restaurants | 845 | |||||||
Right of first refusal, number of states | 20 | |||||||
Proceeds from Issuance of Debt | $ | $ 75,000,000 | $ 200,000,000 | ||||||
Senior Secured Second Lien Notes, Interest Rate | Rate | 8.00% | |||||||
Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Proceeds from Issuance of Debt | $ | $ 275,000,000 | |||||||
Senior Secured Credit Facility [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ | 550,000,000 | |||||||
Term Loan B Facility [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ | $ 425,000,000 | |||||||
Debt instrument, term | 7 years | |||||||
New Revolving Credit Facility [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ | $ 125,000,000 | |||||||
Debt instrument, term | 5 years | |||||||
Area Development And Remodeling Agreement [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Right of first refusal, number of states | state | 16 | 2 | ||||||
Right of first refusal, number of counties | state | 4 | |||||||
Right of first refusal, number of franchises | restaurant | 500 | |||||||
Franchise rights, right of first refusal, quarterly payments | $ | $ 3,000,000 | |||||||
Franchise rights, right of first refusal, term | 1 year | |||||||
Franchise agreement, number of restaurants to be built | restaurant | 200 | |||||||
Franchise agreement, number of restaurants to be remodeled | restaurant | 748 | 80 | ||||||
Franchise Agreement, Number Of Restaurants To Be Built, Year Six | 6 years | |||||||
Base Rate [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt instrument, interest rate, stated percentage | Rate | 2.25% | |||||||
London Interbank Offered Rate (LIBOR) [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt instrument, interest rate, stated percentage | Rate | 3.25% | |||||||
Agreement And Plan Of Merger - Cambridge Holdings, LLC | ||||||||
Subsequent Event [Line Items] | ||||||||
Number of Convenience Stores | restaurant | 6 | |||||||
Business acquisition, equity interest issued or issuable, number of shares | shares | 7,360 | |||||||
Business Combination, Restrictions On Stock, Term Of Restrictions On Sale Or Transfer | 2 years | |||||||
Business Combination, Number Of Director Nominees That May Be Designated By Counterparty | director | 2 | |||||||
Business Combination, Number Of Counterparty Directors Joining Board Upon Merger Completion | director | 2 | |||||||
Burger King Franchises [Member] | Agreement And Plan Of Merger - Cambridge Holdings, LLC | ||||||||
Subsequent Event [Line Items] | ||||||||
Number of Restaurants | restaurant | 165 | |||||||
Popeyes Franchises [Member] | Agreement And Plan Of Merger - Cambridge Holdings, LLC | ||||||||
Subsequent Event [Line Items] | ||||||||
Number of Restaurants | restaurant | 55 | |||||||
Cambridge Holdings, LLC [Member] | Agreement And Plan Of Merger - Cambridge Holdings, LLC | ||||||||
Subsequent Event [Line Items] | ||||||||
Business acquisition, percentage of voting interests acquired | 16.60% | |||||||
Convertible Preferred Stock [Member] | Agreement And Plan Of Merger - Cambridge Holdings, LLC | ||||||||
Subsequent Event [Line Items] | ||||||||
Preferred stock, dividend rate, percentage | 9.00% | |||||||
Convertible preferred stock, shares reserved for future issuance | shares | 10 | |||||||
Common Stock [Member] | Agreement And Plan Of Merger - Cambridge Holdings, LLC | ||||||||
Subsequent Event [Line Items] | ||||||||
Convertible preferred stock, shares reserved for future issuance | shares | 7,450 |
Subsequent Events - Preliminary
Subsequent Events - Preliminary Allocation (Details) - Agreement And Plan Of Merger - Cambridge Holdings, LLC $ in Thousands | Dec. 30, 2018USD ($) |
Subsequent Event [Line Items] | |
Inventory | $ 2,705 |
Prepaid expenses | 2,418 |
Other assets | 11,965 |
Property and equipment | 114,008 |
Franchise fees | 4,175 |
Franchise rights | 207,148 |
Deferred taxes | 725 |
Accounts payable | (3,557) |
Accrued payroll, related taxes and benefits | (3,989) |
Long-term debt | (124,879) |
Lease financing obligations | (50,839) |
Other liabilities | (16,607) |
Net assets acquired | $ 143,273 |
Uncategorized Items - tast-2019
Label | Element | Value |
Accounting Standards Update 2016-02 [Member] | Preferred Stock [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 0 |
Accounting Standards Update 2016-02 [Member] | Common Stock [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 0 |
Accounting Standards Update 2016-02 [Member] | Treasury Stock [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 0 |
Accounting Standards Update 2016-02 [Member] | AOCI Attributable to Parent [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 0 |
Accounting Standards Update 2016-02 [Member] | Additional Paid-in Capital [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 0 |