Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 30, 2020 | Feb. 25, 2021 | Jun. 24, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 30, 2020 | ||
Current Fiscal Year End Date | --12-30 | ||
Document Transition Report | false | ||
Entity File Number | 0-18051 | ||
Entity Registrant Name | DENNY’S CORPORATION | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 13-3487402 | ||
Entity Address, Address Line One | 203 East Main Street | ||
Entity Address, City or Town | Spartanburg, | ||
Entity Address, State or Province | SC | ||
Entity Address, Postal Zip Code | 29319-9966 | ||
City Area Code | 864 | ||
Local Phone Number | 597-8000 | ||
Title of 12(b) Security | $.01 Par Value, Common Stock | ||
Trading Symbol | DENN | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 434,684,492 | ||
Entity Common Stock, Shares Outstanding | 64,144,845 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive Proxy Statement for the 2021 Annual Meeting of Stockholders are incorporated by reference into Part III of this Form 10-K. | ||
Entity Central Index Key | 0000852772 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 3,892 | $ 3,372 |
Investments | 2,272 | 3,649 |
Receivables, net | 21,349 | 27,488 |
Inventories | 1,181 | 1,325 |
Assets held for sale | 1,125 | 1,925 |
Prepaid and other current assets | 18,847 | 14,974 |
Total current assets | 48,666 | 52,733 |
Property, net of accumulated depreciation of $146,583 and $147,445, respectively | 86,154 | 97,626 |
Financing lease right-of-use assets, net of accumulated amortization of $9,907 and $8,468, respectively | 9,830 | 11,720 |
Operating lease right-of-use assets, net | 139,534 | 158,550 |
Goodwill | 36,884 | 36,832 |
Intangible assets, net | 51,559 | 53,956 |
Deferred financing costs, net | 2,414 | 1,727 |
Deferred income taxes, net | 23,210 | 14,718 |
Other noncurrent assets | 32,698 | 32,525 |
Total assets | 430,949 | 460,387 |
Current liabilities: | ||
Current finance lease liabilities | 1,839 | 1,674 |
Current operating lease liabilities | 16,856 | 16,344 |
Accounts payable | 12,021 | 20,256 |
Other current liabilities | 46,462 | 57,307 |
Total current liabilities | 77,178 | 95,581 |
Long-term liabilities: | ||
Long-term debt | 210,000 | 240,000 |
Noncurrent finance lease liabilities | 13,530 | 14,779 |
Noncurrent operating lease liabilities | 137,534 | 152,750 |
Liability for insurance claims, less current portion | 10,309 | 11,454 |
Other noncurrent liabilities | 112,844 | 83,887 |
Total long-term liabilities | 484,217 | 502,870 |
Total liabilities | 561,395 | 598,451 |
Commitments and contingencies | ||
Shareholders’ deficit | ||
Common stock $0.01 par value; shares authorized - 135,000; December 30, 2020: 63,962 shares issued and outstanding; December 25, 2019: 109,415 shares issued and 57,095 shares outstanding | 640 | 1,094 |
Paid-in capital | 123,833 | 603,980 |
Deficit | (194,514) | (189,398) |
Accumulated other comprehensive loss, net | (60,405) | (33,960) |
Treasury stock, at cost, 0 and 52,320 shares, respectively | 0 | (519,780) |
Total shareholders’ deficit | (130,446) | (138,064) |
Total liabilities and shareholders’ deficit | $ 430,949 | $ 460,387 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 |
Statement of Financial Position [Abstract] | ||
Accumulated depreciation | $ 146,583 | $ 147,445 |
Accumulated amortization | $ 9,907 | $ 8,468 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 135,000,000 | 135,000,000 |
Common stock, issued (in shares) | 63,962,000 | 109,415,000 |
Common stock, outstanding (in shares) | 63,962,000 | 57,095,000 |
Treasury stock, at cost (in shares) | 0 | 52,320,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Revenue: | |||
Total operating revenue | $ 288,605 | $ 541,389 | $ 630,179 |
Costs of company restaurant sales, excluding depreciation and amortization: | |||
Product costs | 29,816 | 74,720 | 100,532 |
Payroll and benefits | 51,684 | 118,806 | 164,314 |
Occupancy | 11,241 | 18,613 | 23,228 |
Other operating expenses | 21,828 | 46,257 | 60,708 |
Total costs of company restaurant sales | 114,569 | 258,396 | 348,782 |
Costs of franchise and license revenue | 94,348 | 120,326 | 114,296 |
General and administrative expenses | 55,040 | 69,018 | 63,828 |
Depreciation and amortization | 16,161 | 19,846 | 27,039 |
Operating (gains), losses and other charges, net | 1,808 | (91,180) | 2,620 |
Total operating costs and expenses, net | 281,926 | 376,406 | 556,565 |
Operating income (loss) | 6,679 | 164,983 | 73,614 |
Interest expense, net | 17,965 | 18,547 | 20,745 |
Other nonoperating (income) expense, net | (4,171) | (2,763) | 619 |
Net income (loss) before income taxes | (7,115) | 149,199 | 52,250 |
Provision for (benefit from) income taxes | (1,999) | 31,789 | 8,557 |
Net income (loss) | $ (5,116) | $ 117,410 | $ 43,693 |
Basic net income (loss) per share (in dollars per share) | $ (0.08) | $ 1.96 | $ 0.69 |
Diluted net income (loss) per share (in dollars per share) | $ (0.08) | $ 1.90 | $ 0.67 |
Basic weighted average shares outstanding (in shares) | 60,812 | 59,944 | 63,364 |
Diluted weighted average shares outstanding (in shares) | 60,812 | 61,833 | 65,562 |
Company restaurant sales | |||
Revenue: | |||
Total operating revenue | $ 118,160 | $ 306,377 | $ 411,932 |
Franchise and license revenue | |||
Revenue: | |||
Total operating revenue | $ 170,445 | $ 235,012 | $ 218,247 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ (5,116) | $ 117,410 | $ 43,693 |
Other comprehensive income (loss), net of tax: | |||
Minimum pension liability adjustment, net of tax of $(67), $15 and $53, respectively | (197) | 46 | 155 |
Changes in the fair value of cash flow derivatives, net of tax of $(12,345), $(10,410) and $(339), respectively | (34,565) | (30,076) | (2,256) |
Reclassification of cash flow derivatives to interest expense, net of tax of $874, $75 and $36, respectively | 2,286 | 216 | 271 |
Reclassification of loss related to dedesignation of derivatives to other nonoperating (income) expense, net of tax of $1,892, $0 and $0, respectively | 5,462 | 0 | 0 |
Amortization of unrealized losses related to dedesignated derivatives to interest expense, net of tax of $214, $0 and $0, respectively | 569 | 0 | 0 |
Other comprehensive loss | (26,445) | (29,814) | (1,830) |
Total comprehensive income (loss) | $ (31,561) | $ 87,596 | $ 41,863 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Minimum pension liability adjustment, tax | $ (67) | $ 15 | $ 53 |
Changes in the fair value of cash flow derivatives, tax | (12,345) | (10,410) | (339) |
Reclassification of cash flow derivatives to interest expense, tax | 874 | 75 | 36 |
Reclassification of loss related to dedesignation of derivatives to other nonoperating expense (income), tax | 1,892 | 0 | 0 |
Amortization of unrealized losses related to dedesignated derivatives to interest expense, tax | $ 214 | $ 0 | $ 0 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Deficit - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Treasury Stock | Paid-in Capital | (Deficit) | (Deficit)Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss, Net |
Balance as of beginning period (in shares) at Dec. 27, 2017 | 107,740 | |||||||
Balance as of beginning period at Dec. 27, 2017 | $ (97,360) | $ (15,446) | $ 1,077 | $ (355,626) | $ 594,166 | $ (334,661) | $ (15,446) | $ (2,316) |
Balance as of beginning of period, treasury stock (in shares) at Dec. 27, 2017 | (43,151) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | 43,693 | 43,693 | ||||||
Other comprehensive loss | (1,830) | (1,830) | ||||||
Share-based compensation on equity classified awards, net | 4,325 | 4,325 | ||||||
Purchase of treasury stock (in shares) | (3,901) | |||||||
Purchase of treasury stock | (61,189) | $ (61,189) | ||||||
Equity forward contract issuance/settlement | (6,763) | (6,763) | ||||||
Issuance of common stock for share-based compensation (in shares) | 447 | |||||||
Issuance of common stock for share-based compensation | 0 | $ 5 | (5) | |||||
Exercise of common stock options (in shares) | 398 | |||||||
Exercise of common stock options | 1,225 | $ 4 | 1,221 | |||||
Balance as of end of period (in shares) at Dec. 26, 2018 | 108,585 | |||||||
Balance as of end of period at Dec. 26, 2018 | (133,345) | $ (394) | $ 1,086 | $ (416,815) | 592,944 | (306,414) | $ (394) | (4,146) |
Balance as of end of period, treasury stock (in shares) at Dec. 26, 2018 | (47,052) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | 117,410 | 117,410 | ||||||
Other comprehensive loss | (29,814) | (29,814) | ||||||
Share-based compensation on equity classified awards, net | 3,310 | 3,310 | ||||||
Purchase of treasury stock (in shares) | (4,879) | |||||||
Purchase of treasury stock | (96,202) | $ (96,202) | ||||||
Equity forward contract issuance/settlement (in shares) | (389) | |||||||
Equity forward contract issuance/settlement | 0 | $ (6,763) | 6,763 | |||||
Issuance of common stock for share-based compensation (in shares) | 468 | |||||||
Issuance of common stock for share-based compensation | 0 | $ 5 | (5) | |||||
Exercise of common stock options (in shares) | 362 | |||||||
Exercise of common stock options | $ 971 | $ 3 | 968 | |||||
Balance as of end of period (in shares) at Dec. 25, 2019 | 109,415 | 109,415 | ||||||
Balance as of end of period at Dec. 25, 2019 | $ (138,064) | $ 1,094 | $ (519,780) | 603,980 | (189,398) | (33,960) | ||
Balance as of end of period, treasury stock (in shares) at Dec. 25, 2019 | (52,320) | (52,320) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | $ (5,116) | (5,116) | ||||||
Other comprehensive loss | (26,445) | (26,445) | ||||||
Share-based compensation on equity classified awards, net | $ 3,374 | 3,374 | ||||||
Purchase of treasury stock (in shares) | (1,700) | (1,690) | ||||||
Purchase of treasury stock | $ (34,193) | $ (34,193) | ||||||
Retirement of treasury stock (in shares) | (54,010) | 54,010 | ||||||
Retirement of treasury stock | 0 | $ (540) | $ 553,973 | (553,433) | ||||
Issuance of common stock (in shares) | 8,000 | |||||||
Issuance of common stock | 69,571 | $ 80 | 69,491 | |||||
Issuance of common stock for share-based compensation (in shares) | 447 | |||||||
Issuance of common stock for share-based compensation | 0 | $ 5 | (5) | |||||
Exercise of common stock options (in shares) | 110 | |||||||
Exercise of common stock options | $ 427 | $ 1 | 426 | |||||
Balance as of end of period (in shares) at Dec. 30, 2020 | 63,962 | 63,962 | ||||||
Balance as of end of period at Dec. 30, 2020 | $ (130,446) | $ 640 | $ 0 | $ 123,833 | $ (194,514) | $ (60,405) | ||
Balance as of end of period, treasury stock (in shares) at Dec. 30, 2020 | 0 | 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (5,116) | $ 117,410 | $ 43,693 |
Adjustments to reconcile net income (loss) to cash flows provided by (used in) operating activities: | |||
Depreciation and amortization | 16,161 | 19,846 | 27,039 |
Operating (gains), losses and other charges, net | 1,808 | (91,180) | 2,620 |
Gains (losses) on interest rate swap derivatives, net | (2,164) | 0 | 0 |
Amortization of deferred financing costs | 876 | 608 | 607 |
Gains on investments | (123) | (180) | (9) |
(Gains) losses on early extinguishments of debt and leases | 224 | (4) | (171) |
Deferred income tax expense | 3,981 | 16,005 | 6,193 |
Increase (decrease) of tax valuation allowance | (3,041) | (2,935) | 121 |
Share-based compensation | 7,948 | 6,694 | 6,038 |
Changes in assets and liabilities: | |||
Receivables | 6,378 | (2,030) | (4,722) |
Inventories | 101 | 1,668 | 141 |
Prepaids and other current assets | (3,872) | (4,108) | 921 |
Other assets | (1,816) | (4,581) | 2 |
Operating lease assets/liabilities | 844 | (601) | 0 |
Accounts payable | (10,682) | (5,170) | (5,147) |
Accrued salaries and vacations | (2,835) | (3,826) | 2,175 |
Accrued taxes | (774) | (2,043) | 283 |
Other accrued liabilities | (5,525) | (4,144) | (1,676) |
Other noncurrent liabilities | (5,510) | 1,898 | (4,418) |
Net cash flows provided by (used in) operating activities | (3,137) | 43,327 | 73,690 |
Cash flows from investing activities: | |||
Capital expenditures | (6,962) | (13,975) | (22,025) |
Acquisition of restaurants and real estate | 0 | (11,320) | (10,416) |
Proceeds from disposition of property | 9,398 | 129,721 | 3,052 |
Investment purchases | (1,400) | (1,760) | (1,700) |
Proceeds from sale of investments | 2,900 | 0 | 0 |
Collections on notes receivable | 1,814 | 3,654 | 2,740 |
Issuance of notes receivable | (1,099) | (1,351) | (3,668) |
Net cash flows provided by (used in) investing activities | 4,651 | 104,969 | (32,017) |
Cash flows from financing activities: | |||
Revolver borrowings | 140,500 | 164,400 | 136,000 |
Revolver payments | (170,500) | (210,900) | (108,500) |
Long-term debt payments | (1,570) | (2,464) | (3,181) |
Tax withholding on share-based payments | (4,331) | (3,206) | (1,714) |
Deferred financing costs | (1,758) | 0 | 0 |
Purchase of treasury stock | (36,008) | (94,459) | (61,237) |
Purchase of equity forward contract | 0 | 0 | (6,763) |
Proceeds from issuance of common stock | 69,571 | 0 | 0 |
Proceeds from exercise of stock options | 427 | 971 | 1,225 |
Net bank overdrafts | 2,675 | (4,292) | 2,540 |
Net cash flows used in financing activities | (994) | (149,950) | (41,630) |
Increase (decrease) in cash and cash equivalents | 520 | (1,654) | 43 |
Cash and cash equivalents at beginning of period | 3,372 | 5,026 | 4,983 |
Cash and cash equivalents at end of period | $ 3,892 | $ 3,372 | $ 5,026 |
Introduction and Basis of Repor
Introduction and Basis of Reporting | 12 Months Ended |
Dec. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Introduction and Basis of Reporting | Introduction and Basis of Reporting Denny’s Corporation, Denny’s, or the Company, is one of America’s largest franchised full-service restaurant chains based on number of restaurants. Denny’s restaurants are operated in 49 states, the District of Columbia, two U.S. territories and 11 foreign countries with principal concentrations in California (23% of total restaurants), Texas (12%) and Florida (8%). The global crisis resulting from the spread of coronavirus ("COVID-19") has had a substantial impact on our restaurant operations for the year ended December 30, 2020, which is expected to continue, with the timing of a recovery uncertain. During the year ended December 30, 2020, many of our company and franchised and licensed restaurants were temporarily closed and most of the restaurants that remained open had limited operations. Our operating results substantially depend upon the sales volumes, restaurant profitability, and financial stability of our company and franchised and licensed restaurants. We cannot currently estimate the duration or future negative financial impact of the COVID-19 pandemic on our business; however, we expect the COVID-19 pandemic will continue to impact our results of operations through at least 2021. Ongoing material adverse effects of the COVID-19 pandemic for an extended period could negatively affect our business, results of operations, liquidity and financial condition and could impact our impairment assessments of accounts receivable, intangible assets, long-lived assets and goodwill. At December 30, 2020, the Denny’s brand consisted of 1,650 restaurants, 1,585 of which were franchised/licensed restaurants and 65 of which were company restaurants. Changes in restaurant counts are as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 Company restaurants, beginning of period 68 173 178 Units opened — — 1 Units acquired from franchisees — — 6 Units sold to franchisees — (105) (8) Units closed (3) — (4) End of period 65 68 173 Franchised and licensed restaurants, beginning of period 1,635 1,536 1,557 Units opened 20 30 29 Units purchased from Company — 105 8 Units acquired by Company — — (6) Units closed (70) (36) (52) End of period 1,585 1,635 1,536 Total restaurants, end of period 1,650 1,703 1,709 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The following accounting policies significantly affect the preparation of our Consolidated Financial Statements: Use of Estimates . In preparing our Consolidated Financial Statements in conformity with U.S. generally accepted accounting principles (GAAP), management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities, revenues, expenses and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially from these estimates. Consolidation Policy . Our Consolidated Financial Statements include the financial statements of Denny’s Corporation and its wholly-owned subsidiaries: Denny’s, Inc., DFO, LLC, Denny’s Realty, LLC and East Main Insurance Company. All significant intercompany balances and transactions have been eliminated in consolidation. Fiscal Year . Our fiscal year ends on the last Wednesday in December. As a result, a fifty-third week is added to a fiscal year every five or six years. Fiscal 2020 included 53 weeks of operation, whereas 2019 and 2018 each included 52 weeks of operations. Cash and Cash Equivalents. Our policy is to invest cash in excess of operating requirements in short-term highly liquid investments with an original maturity of three months or less, which we consider to be cash equivalents. Cash and cash equivalents include short-term investments of $0.4 million at December 30, 2020 and December 25, 2019. Receivables. Effective December 26, 2019, the first day of fiscal 2020, we adopted Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” and all subsequent ASUs that modified Topic 326. The new guidance replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform financial statement users of credit loss estimates. Receivables, which are recorded at net realizable value, primarily consist of trade accounts receivables and financing receivables from franchisees, vendor receivables and credit card receivables. Trade accounts receivables from franchisees consist of royalties, advertising and rent. Financing receivables from franchisees primarily consist of notes from franchisees related to the roll-out of restaurant equipment. We accrue interest on notes receivable based on the contractual terms. The allowance for doubtful accounts is based on management’s estimates of expected credit losses. Receivables that are ultimately deemed to be uncollectible, and for which collection efforts have been exhausted, are written off against the allowance for doubtful accounts. Inventories. Inventories consist primarily of food and beverages and are valued at the lower of first-in, first-out cost or net realizable value. Property and Depreciation. Owned property is stated at cost. Property under finance leases is stated at the lesser of its fair value or the net present value of the related minimum lease payments at the lease inception. Maintenance and repairs are expensed as incurred. We depreciate owned property over its estimated useful life using the straight-line method. We amortize property held under finance leases (at capitalized value) over the lesser of its estimated useful life or the lease term. Building assets are assigned estimated useful lives that range from five two five Goodwill. Amounts recorded as goodwill primarily represent excess reorganization value recognized as a result of our 1998 bankruptcy. We also record goodwill in connection with the acquisition of restaurants from franchisees. Likewise, upon the sale of restaurant operations to franchisees, goodwill is decremented. We test goodwill for impairment at each fiscal year end and more frequently if circumstances indicate impairment may exist. Such indicators include, but are not limited to, a significant decline in our expected future cash flows, a significant adverse decline in our stock price, significantly adverse legal developments and a significant change in the business climate. Intangible Assets . Intangible assets consist primarily of trade names and reacquired franchise rights. Trade names are considered indefinite-lived intangible assets and are not amortized. Reacquired franchise rights are amortized using the straight-line basis over the term of the related franchise agreement. Reacquired franchise rights resulting from acquisitions are accounted for using the purchase method of accounting and are estimated by management based on the fair value of the assets received. We test trade name assets for impairment at each fiscal year end, and more frequently if circumstances indicate impairment may exist. We assess impairment of reacquired franchise rights whenever changes or events indicate that the carrying value may not be recoverable. Costs incurred to renew or extend the term of recognized intangible assets are recorded in general and administrative expenses in our Consolidated Statements of Operations. Marketable Securities. Marketable securities included in investments consist of available for sale equity instruments and are recorded at fair market value in our Consolidated Balance Sheets. The aggregate cost and fair value of these marketable securities was $2.2 million and $2.3 million, respectively, at December 30, 2020 and $3.5 million and $3.6 million, respectively, at December 25, 2019. Unrealized gains and losses included in fair value were losses of $0.1 million and gains of $0.2 million at December 30, 2020 and December 25, 2019, respectively. Marketable securities included in other noncurrent assets consist of trading debt and equity mutual funds and are recorded at fair market value in our Consolidated Balance Sheets. These securities represent the plan assets of our nonqualified deferred compensation plan (the “plan assets”). The plan assets are held in a rabbi trust. Each plan participant’s account consists of their contribution, our matching contribution (made prior to 2016) and each participant’s share of earnings or losses in the plan. We have recorded offsetting deferred compensation liabilities as a component of other noncurrent liabilities in our Consolidated Balance Sheets. The realized and unrealized holding gains and losses related to marketable securities are recorded in other income (expense) with an offsetting amount recorded in general and administrative expenses related to deferred compensation plan liabilities. During 2020, 2019 and 2018, we incurred a net gain of $1.8 million, a net gain of $2.7 million and a net loss of $1.0 million, respectively, related to marketable securities. Deferred Financing Costs. Costs related to the issuance of debt are deferred and amortized as a component of interest expense using the effective interest method over the terms of the respective debt issuances. Self-insurance Liabilities. We record liabilities for insurance claims during periods in which we have been insured under large deductible programs or have been self-insured for our medical claims and workers’ compensation, general, product and automobile insurance liabilities. The liabilities represent estimated incurred losses. These estimates include assumptions regarding claims frequency and severity as well as changes in our business environment, medical costs and the regulatory environment that could impact our overall self-insurance costs. Total workers’ compensation, general, product and automobile insurance liabilities at December 30, 2020 and December 25, 2019 were $14.0 million and $16.1 million, respectively. Income Taxes. We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. All deferred taxes are reported as noncurrent in our Consolidated Balance Sheets. A valuation allowance reduces our net deferred tax asset to the amount that is more likely than not to be realized. We make certain estimates and judgments in the calculation of our provision for incomes taxes, in the resulting tax liabilities, and in the recoverability of deferred tax assets. We recognize positions taken or expected to be taken in a tax return in the Consolidated Financial Statements when it is more-likely-than-not that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit with greater than 50% likelihood of being realized upon ultimate settlement. We recognize any interest and penalties related to unrecognized tax benefits in income tax expense. Assessment of uncertain tax positions requires judgments relating to the amounts, timing and likelihood of resolution. Leases and Subleases. Effective December 27, 2018, the first day of fiscal 2019, we adopted Accounting Standards Update (“ASU”) 2016-02, “Leases (Topic 842)” and all subsequent ASUs that modified Topic 842. Upon adoption of Topic 842, we recorded operating lease liabilities of $101.3 million and ROU assets of $94.2 million related to existing operating leases. In addition, we recorded a cumulative effect adjustment increasing opening deficit by $0.4 million and deferred tax assets by $0.1 million. See Note 8 for further information about our transition to Topic 842 and the required disclosures. Lessee We lease certain real estate and equipment for our restaurants and support facilities. At contract inception, we determine whether a contract is, or contains, a lease by determining whether it conveys the right to control the use of the identified asset for a period of time. We recognize a lease liability and a right-of-use (“ROU”) asset at the lease commencement date. For operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. For finance leases, the lease liability is initially measured in the same manner and date as for operating leases, and is subsequently measured at amortized cost using the effective interest method. Operating lease ROU assets are initially and subsequently measured throughout the lease term at the carrying amount of the lease liability adjusted for initial direct costs, prepayments, accrued payments and lease incentives, if any. Lease cost is recognized on a straight-line basis over the lease term. Operating lease payments are classified as cash flows for operating activities with ROU asset amortization and the change in the lease liability combined as "Operating lease assets/liabilities" in the reconciliation of net income (loss) to net cash flows provided by (used in) operating activities in the Consolidated Statement of Cash Flows. Finance lease ROU assets are initially measured at cost and subsequently amortized on a straight-line basis over the lesser of the useful life or the lease term. Finance lease payments are classified as cash flows used in financing activities in the Consolidated Statement of Cash Flows. Operating and finance lease ROU assets are assessed for impairment using long-lived assets impairment guidance. We use a consistent lease term for calculating the depreciation period for the related assets, classifying the lease and computing periodic rent expense where the lease terms include escalations in rent over the lease term. The new lease guidance provides practical expedients and accounting elections for our ongoing accounting after adoption. We elected the practical expedient to not separate nonlease components (such as common area maintenance) from lease components in regard to all leases and the portfolio approach in applying the discount rate to our leases. Key estimates and judgments include how we determine (1) lease payments, (2) lease term and (3) the discount rate used to discount the unpaid lease payments to present value. We have certain lease agreements structured with both a fixed base rent and a contingent rent based on a percentage of sales over contractual levels, others with only contingent rent based on a percentage of sales and some with a fixed base rent adjusted periodically for inflation or changes in the fair market rent rate. Contingent rent is recognized as sales occur. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. The exercise of lease renewal options is at our sole discretion, except in certain sublease situations in which we have determined that it is reasonably certain that one or more options will be exercised, including where the exercise of a sublease option compels us to exercise the renewal option of the underlying master lease. Renewal option periods are included in the measurement of lease ROU asset and lease liability where the exercise is reasonably certain to occur. The discount rate used to determine the present value of the lease payments is our estimated collateralized incremental borrowing rate, based on the yield curve for the respective lease terms, as we generally cannot determine the interest rate implicit in the lease. Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are the same as the lessee leases described above. Contingent rental income is recognized when earned. Similar to our lessee accounting, we elected the lessor practical expedient to not separate nonlease components from lease components in regard to all leases. Refer to the Newly Adopted Accounting Standards section of this Note for adoption of the practical expedient on lease concessions related to effects of the COVID-19 pandemic. Employee Benefit Plans. Each year we measure and recognize the funded status of our defined benefit plans in our Consolidated Balance Sheets as of December 31. That date represents the month-end that is closest to our fiscal year-end. The funded status is adjusted for any contributions or significant events (such as a plan amendment, settlement, or curtailment that calls for a remeasurement) that occurs between our fiscal year-end and December 31. Derivative Instruments. We use derivative financial instruments to manage our exposure to interest rate risk. We do not enter into derivative instruments for trading or speculative purposes. All derivatives are recognized on our Consolidated Balance Sheets at fair value. Changes in the fair values of derivatives are recorded in earnings or other comprehensive income ( “ OCI ” ), based on whether the instrument is designated as a hedge transaction. Gains or losses on derivative instruments reported in OCI are classified to earnings in the period the hedged item affects earnings. If the underlying hedge transaction ceases to exist, any associated amounts reported in OCI are reclassified to earnings. By entering into derivative instruments, we are exposed to counterparty credit risk. When the fair value of a derivative instrument is in an asset position, the counterparty has a liability to us, which creates credit risk for us. We manage our exposure to this risk by selecting counterparties with investment grade credit ratings and regularly monitoring our market position with each counterparty. Contingencies and Litigation. We are subject to legal proceedings involving ordinary and routine claims incidental to our business, as well as legal proceedings that are nonroutine and include compensatory or punitive damage claims. Our ultimate legal and financial liability with respect to such matters cannot be estimated with certainty and requires the use of estimates in recording liabilities for potential litigation settlements. When the reasonable estimate is a range, the recorded loss will be the best estimate within the range. We record legal settlement costs as other operating expenses in our Consolidated Statements of Operations as those costs are incurred. Comprehensive Income (Loss). Comprehensive income (loss) includes net income (loss) and OCI items that are excluded from net income (loss) under U.S. generally accepted accounting principles. OCI items include additional minimum pension liability adjustments, the effective unrealized portion of changes in the fair value of cash flow hedges, and the reclassification and amortization of loss related to the dedesignation of cash flow derivatives. Segment. Denny’s operates in only one segment. All significant revenues and pre-tax earnings relate to retail sales of food and beverages to the general public through either company or franchised restaurants. Revenues. Effective December 28, 2017, the first day of fiscal 2018, we adopted ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” and all subsequent ASUs that modified Topic 606. We elected to apply the modified retrospective method of adoption to those contracts which were not completed as of December 28, 2017. In doing so, we applied the practical expedient to aggregate all contract modifications that occurred before December 28, 2017 in determining the satisfied and unsatisfied performance obligations, the transaction price and the allocation of the transaction price to the satisfied and unsatisfied performance obligations. Company Restaurant Revenue. Company restaurant revenue is recognized at the point in time when food and beverage products are sold at company restaurants. We present company restaurant sales net of sales-related taxes collected from customers and remitted to governmental taxing authorities. Franchise Revenue. Franchise and license revenues consist primarily of royalties, advertising revenue, initial and other fees and occupancy revenue. Under franchise agreements we provide franchisees with a license of our brand’s symbolic intellectual property, administration of advertising programs (including local co-operatives), and other ongoing support functions. These services are highly interrelated so we do not consider them to be individually distinct performance obligations, and therefore account for them as a single performance obligation. Revenue from franchise agreements is recognized evenly over the term of the agreement with the exception of sales-based royalties. Royalty and advertising revenues represent sales-based royalties that are recognized in the period in which the sales occur. Sales-based royalties are variable consideration related to our performance obligation to our franchisees to maintain the intellectual property being licensed. Under our franchise agreements, franchisee advertising contributions must be spent on marketing and related activities. Advertising revenues and expenditures are recorded on a gross basis within the Consolidated Statements of Operations. Initial and other fees include initial, successor and assignment franchise fees (“initial franchise fees”). Initial franchise fees are billed and received upon the signing of the franchise agreement. Recognition of these fees is deferred until the commencement date of the agreement and occurs over time based on the term of the underlying franchise agreement. In the event a franchise agreement is terminated, any remaining deferred fees are recognized in the period of termination. Initial and other fees also include revenue that are distinct from the franchise agreement and are separate performance obligations. Training and other franchise services fees are billed and recognized at a point in time as services are rendered. Similar to advertising revenue, other franchise services fees are recorded on a gross basis within the Consolidated Statements of Operations. Occupancy revenue results from leasing or subleasing restaurants to franchisees and is recognized over the term of the lease agreement. With the exception of initial and other franchise fees, revenues are typically billed and collected on a weekly basis. For 2020, 2019 and 2018, our ten largest franchisees accounted for 39%, 35% and 30% of our franchise revenues, respectively. Gift cards. Company restaurants, franchised restaurants and certain third party retailers sell gift cards which have no stated expiration dates. We recognize revenue when a gift card is redeemed in one of our company restaurants. We maintain a gift card liability for cards sold in our company restaurants and for cards sold by third parties. Gift card breakage is recognized proportionally as redemptions occur. Our gift card breakage primarily relates to cards sold by third parties and is recorded as advertising revenue (included as a component of franchise and license revenue). Advertising Costs . We expense production costs for radio and television advertising in the year in which the commercials are initially aired and other advertising costs as incurred. Advertising costs for company restaurants are recorded as a component of other operating expenses in our Consolidated Statements of Operations and were $3.9 million, $11.2 million and $15.0 million for 2020, 2019 and 2018, respectively. Advertising costs related to franchised restaurants are recorded as a component of franchise and license costs and were $53.7 million, $81.1 million and $78.3 million in 2020, 2019 and 2018, respectively. Restructuring and Exit Costs. Restructuring and exit costs are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. Restructuring costs consist primarily of severance and other restructuring charges for terminated employees. Prior to the adoption of Topic 842, exit costs consisted primarily of the costs of future obligations related to closed restaurants. Discounted liabilities for future lease costs and the fair value of related subleases of closed restaurants were recorded when the restaurants were closed. All other costs related to closed restaurants were expensed as incurred. As a result of the adoption of Topic 842, exit cost liabilities related to operating lease costs are now included as a component of operating lease liabilities in our Consolidated Balance Sheets. Amounts recorded as exit costs include period costs related to closed units. Disposal or Impairment of Long-lived Assets. We evaluate our long-lived assets for impairment at the restaurant level on a quarterly basis, when assets are identified as held for sale or whenever changes or events indicate that the carrying value may not be recoverable. For assets identified as held for sale, we use the market approach and consider proceeds from similar asset sales. We assess impairment of restaurant-level assets based on the operating cash flows of the restaurant, expected proceeds from the sale of assets and our plans for restaurant closings. For underperforming assets, we use the income approach to determine both the recoverability and estimated fair value of the assets. To estimate future cash flows, we make certain assumptions about expected future operating performance, such as revenue growth, operating margins, risk-adjusted discount rates, and future economic and market conditions. If the long-lived assets of a restaurant are not recoverable based upon estimated future, undiscounted cash flows, we write the assets down to their fair value. If these estimates or their related assumptions change in the future, we may be required to record additional impairment charges. These charges are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. Assets held for sale consist of real estate properties and/or restaurant operations that we expect to sell within the next year. The assets are reported at the lower of carrying amount or fair value less costs to sell. Fair value is based upon Level 2 inputs, which include sales agreements. We cease recording depreciation on assets that are classified as held for sale. If the determination is made that we no longer expect to sell an asset within the next year, the asset is reclassified out of held for sale. Discontinued Operations. We evaluate restaurant closures and assets reclassified to assets held for sale for potential disclosure as discontinued operations. Only disposals resulting in a strategic shift that will have a major effect on our operations and financial results are reported as discontinued operations. There have been no such disposals, nor any disposals of individually significant components. The gains and losses related to restaurant closures and assets reclassified to assets held for sale are included as a component of operating (gain), losses and other charges, net in our Consolidated Statements of Operations. Gains and Losses on Sales of Restaurants Operations to Franchisees, Real Estate and Other Assets. Generally, gains and losses on sales of restaurant operations to franchisees (which may include real estate), real estate properties and other assets are recognized when the sales are consummated and certain other gain recognition criteria are met. Total gains and losses are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. Share-based Compensation. Share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. Share-based compensation expense is included as a component of general and administrative expenses in our Consolidated Statements of Operations. We account for forfeitures as they occur. Excess tax benefits recognized related to share-based compensation are included as a component of provision for (benefit from) income taxes in our Consolidated Statements of Operations and are classified as operating activities in our Consolidated Statements of Cash Flows. Generally, compensation expense related to performance share units and restricted stock units for board members is based on the number of units granted, the period over which they are expected to vest and the fair market value of our common stock on the date of the grant. For restricted stock units and performance share units that contain a market condition, compensation expense is based on the Monte Carlo valuation method, which utilizes multiple input variables to determine the probability of the Company achieving the market condition and the fair value of the award. The key assumptions used include expected volatility and risk-free interest rates over the term of the award. Subsequent to the vesting period, earned stock-settled restricted stock units and performance share units (both of which are equity classified) are paid to the holder in shares of our common stock, provided the holder was still employed with Denny’s or an affiliate as of the vesting date. Earnings Per Share . Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and potential common shares outstanding during the period. Newly Adopted Accounting Standards Effective December 26, 2019, the first day of fiscal 2020, we adopted ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The new guidance replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform financial statement users of credit loss estimates. The adoption of this guidance did not have a material impact on our Consolidated Financial Statements. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. The new guidance provides optional guidance, for a limited time, to ease the potential burden in accounting for or recognizing the effects of reference rate reform on financial reporting. ASU 2020-04 is effective for a limited time, from March 12, 2020 through December 31, 2022. The Company adopted this ASU on March 12, 2020. The adoption of ASU 2020-04 did not have a significant impact on the Company’s consolidated financial position or results of operations. In April 2020, the FASB staff issued interpretive guidance that indicated it would be acceptable for entities to make an election to account for lease concessions related to the effects of the COVID-19 pandemic consistent with how those concessions would be accounted for under ASU 2016-02, “Leases (Topic 842): Targeted Improvements”, as though enforceable rights and obligations for those concessions existed (regardless of whether those enforceable rights and obligations for the concessions explicitly exist in the contract). Consequently, for concessions related to the effects of the COVID-19 pandemic, an entity will not have to analyze each contract to determine whether enforceable rights and obligations for concessions exist in the contract and can elect to apply or not apply the lease modification guidance in Topic 842 to those contracts. This election is available for concessions related to the effects of the COVID-19 pandemic that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee. We have elected to apply this interpretive guidance to the rent relief we have secured, and have assumed that enforceable rights and obligations for those concessions exist in the lease contract. As such, starting in April 2020, we began recognizing abatements or deferrals in rents received from landlords as reductions in variable lease payments. This election will continue while these abatement or deferrals are in effect. Additional new accounting guidance became effective for us as of December 26, 2019 that we reviewed and concluded was either not applicable to our operations or had no material effect on our Consolidated Financial Statements and related disclosures. Accounting Standards to be Adopted In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”, which modifies Topic 740 to simplify the accounting for income taxes. ASU 2019-12 is effective for financial statements issued for annual periods beginning after December 15, 2020, and for the interim periods therein. The adoption of ASU 2019-12 is not expected to have a significant impact on the Company’s consolidated financial position or results of operations. We reviewed all other newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on our Consolidated Financial Statements as a result of future adoption. |
Receivables
Receivables | 12 Months Ended |
Dec. 30, 2020 | |
Receivables [Abstract] | |
Receivables | Receivables Receivables, net consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Receivables, net: Trade accounts receivable from franchisees $ 15,535 $ 14,551 Other receivables from franchisees 2,104 2,230 Vendor receivables 2,199 3,260 Credit card receivables 542 6,806 Other 2,668 915 Allowance for doubtful accounts (1,699) (274) Total receivables, net $ 21,349 $ 27,488 Other noncurrent assets: Financing receivables from franchisees $ 502 $ 364 |
Property
Property | 12 Months Ended |
Dec. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property | Property Property, net consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Land $ 36,815 $ 39,720 Buildings and leasehold improvements 160,842 172,881 Other property and equipment 35,080 32,470 Total property 232,737 245,071 Less accumulated depreciation 146,583 147,445 Property, net $ 86,154 $ 97,626 The following table reflects the property assets, included in the table above, and buildings with finance leases which were leased to franchisees: December 30, 2020 December 25, 2019 (In thousands) Land $ 25,192 $ 27,205 Buildings and leasehold improvements 69,656 78,584 Total property owned, leased to franchisees 94,848 105,789 Less accumulated depreciation 59,038 65,476 Property owned, leased to franchisees, net 35,810 40,313 Buildings held under finance leases, leased to franchisees 8,062 8,445 Less accumulated amortization 4,137 3,768 Property held under finance leases, leased to franchisees, net 3,925 4,677 Total property leased to franchisees, net $ 39,735 $ 44,990 Depreciation expense, including amortization of property under finance leases, for 2020, 2019 and 2018 was $13.2 million, $16.3 million and $23.0 million, respectively. Substantially all owned property is pledged as collateral for our Credit Facility. See Note 9. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The following table reflects the changes in carrying amounts of goodwill: December 30, 2020 December 25, 2019 (In thousands) Balance, beginning of year $ 36,832 $ 39,781 Adjustments related to the sale of restaurants 52 (2,949) Balance, end of year $ 36,884 $ 36,832 Intangible assets consist of the following: December 30, 2020 December 25, 2019 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (In thousands) Intangible assets with indefinite lives: Trade names $ 44,087 $ — $ 44,087 $ — Liquor licenses 120 — 120 — Intangible assets with definite lives: Reacquired franchise rights 12,218 4,866 15,516 5,767 Intangible assets $ 56,425 $ 4,866 $ 59,723 $ 5,767 The weighted-average life of the reacquired franchise rights is approximately eight years. The amortization expense for definite-lived intangibles for 2020, 2019 and 2018 was $3.0 million, $3.6 million and $4.1 million, respectively. Estimated amortization expense for intangible assets with definite lives in the next five years is as follows: (In thousands) 2021 $ 1,333 2022 1,226 2023 902 2024 832 2025 776 Due to the impact of the COVID-19 pandemic to the global economy, including but not limited to the volatility of the Company's stock price as well as that of its competitors, the negative impact on sales at company and franchised and licensed restaurants and the challenging environment for the restaurant industry generally, the Company determined that there were indicators of potential impairment of its goodwill and indefinite-lived intangible assets during the year ended December 30, 2020. As such, the Company performed impairment assessments for both goodwill and indefinite-lived intangible assets and concluded that the fair value of these assets substantially exceeded their carrying values. However, we recorded approximately $0.1 million of impairment related to reacquired franchise rights during the year ended December 30, 2020. See Note 14 . We updated our impairment assessments as of December 30, 2020 to perform our annual impairment tests and determined that none of the recorded goodwill or other intangible assets with indefinite lives were impaired. |
Other Current Liabilities
Other Current Liabilities | 12 Months Ended |
Dec. 30, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Other Current Liabilities | Other Current Liabilities Other current liabilities consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Accrued payroll $ 17,076 $ 19,689 Accrued insurance, primarily current portion of liability for insurance claims 4,667 6,515 Accrued taxes 4,850 5,624 Accrued advertising 4,318 6,753 Gift cards 6,127 6,469 Other 9,424 12,257 Other current liabilities $ 46,462 $ 57,307 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair Value of Assets and Liabilities Measured on a Recurring and Nonrecurring Basis Financial assets and liabilities measured at fair value on a recurring basis are summarized below: Total Quoted Prices in Active Markets for Identical Assets/Liabilities Significant Other Observable Inputs Significant Unobservable Inputs (In thousands ) Fair value measurements as of December 30, 2020: Deferred compensation plan investments (1) $ 13,627 $ 13,627 $ — $ — Interest rate swaps, net (2) (76,445) — (76,445) — Investments (3) 2,272 — 2,272 — Total $ (60,546) $ 13,627 $ (74,173) $ — Fair value measurements as of December 25, 2019: Deferred compensation plan investments (1) $ 13,517 $ 13,517 $ — $ — Interest rate swaps (2) (44,670) — (44,670) — Investments (3) 3,649 — 3,649 — Total $ (27,504) $ 13,517 $ (41,021) $ — (1) The fair values of our deferred compensation plan investments are based on the closing market prices of the elected investments. (2) The fair values of our interest rate swaps are based upon Level 2 inputs, which include valuation models. The key inputs for the valuation models are quoted market prices, interest rates and forward yield curves. See Note 9 for details on the interest rate swaps. (3) The fair value of investments is valued using a readily determinable net asset value per share based on the fair value of the underlying securities. There are no significant redemption restrictions associated with these investments. Those assets and liabilities measured at fair value on a nonrecurring basis are summarized below: Significant Unobservable Inputs Impairment Charges (In thousands) Fair value measurements as of December 30, 2020: Assets held and used (1) $ 2,425 $ 1,564 (1) At December 30, 2020, impaired assets were written down to their fair value. To determine fair value, we used the income approach, which assumes that the future cash flows reflect current market expectations. These fair value measurements require significant judgment using Level 3 inputs, such as discounted cash flows from operations, which are not observable from the market, directly or indirectly. There is uncertainty in the projected future cash flows used in the Company's impairment analysis, which requires the use of estimates and assumptions. If actual performance does not achieve the projections, or if the assumptions used change in the future, we may be required to recognize impairment charges in future periods. Assets that are measured at fair value on a non-recurring basis include property, operating right-of-use assets, finance right-of-use assets and reacquired franchise rights. During the year ended December 30, 2020, we recognized impairment charges of $4.1 million related to certain of these assets. See Note 14 . |
Leases
Leases | 12 Months Ended |
Dec. 30, 2020 | |
Leases [Abstract] | |
Leases | Leases Lessee Our operations utilize property, facilities and equipment leased from others. Buildings and facilities are primarily used for restaurants and support facilities. Many of our restaurants are operated under lease arrangements which generally provide for a fixed base rent, and, in many instances, contingent rent based on a percentage of gross revenues. Initial terms of land and restaurant building leases generally range from 10 to 20 years, exclusive of options to renew, which are typically for five year periods. Leases of equipment consist primarily of restaurant equipment, computer equipment and vehicles. Initial terms of equipment leases generally range from three Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. The components of lease costs were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease costs Finance lease costs: Amortization of right-of-use assets Depreciation and amortization $ 1,870 $ 2,991 Interest on lease liabilities Interest expense, net 3,129 4,536 Operating lease costs: Operating lease costs - company Occupancy 6,432 8,253 Operating lease costs - franchise Costs of franchise and license revenue 18,682 17,097 Operating lease costs - general and administrative General and administrative expenses 100 108 Operating lease costs - closed stores Restructuring charges and exit costs 173 — Variable lease costs: Variable lease costs - company Occupancy 2,854 5,993 Variable lease costs - franchise Costs of franchise and license revenue 6,102 7,001 Variable lease costs - general and administrative General and administrative expenses 61 41 Variable lease costs - closed stores Restructuring charges and exit costs 56 49 Sublease income: Sublease income - franchise Franchise and license revenue (30,925) (28,986) Sublease income - closed stores Restructuring charges and exit costs (114) (306) Total lease costs $ 8,420 $ 16,777 Lease terms and discount rates were as follows: December 30, 2020 December 25, 2019 Weighted-average remaining lease term (in years): Finance leases 9.3 9.7 Operating leases 10.7 10.8 Weighted-average discount rate: Finance leases 23.8 % 23.5 % Operating leases 5.8 % 5.9 % The components of lease income were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease income Operating lease income - franchise Franchise and license revenue $ 33,621 $ 28,050 Operating lease income - closed stores Restructuring charges and exit costs 66 255 Variable lease income - franchise Franchise and license revenue 8,246 10,464 Variable lease income - closed stores Restructuring charges and exit costs 48 49 Total lease income $ 41,981 $ 38,818 Cash and supplemental noncash amounts were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 3,129 $ 4,536 Operating cash flows from operating leases $ 23,511 $ 26,329 Financing cash flows from finance leases $ 1,570 $ 2,464 Right-of-use assets obtained in exchange for new finance lease liabilities $ 142 $ 305 Right-of-use assets obtained in exchange for new operating lease liabilities $ 4,831 $ 79,534 Maturities of lease liabilities and receipts in accordance with Topic 842 as of December 30, 2020 were as follows: Lease Liabilities Lease Receipts Finance Operating Operating (In thousands) 2021 $ 4,737 $ 25,184 $ 31,732 2022 4,343 22,381 28,792 2023 3,778 20,146 26,210 2024 3,171 18,621 24,704 2025 3,163 17,453 24,248 Thereafter 19,364 106,039 177,448 Total undiscounted cash flows 38,556 209,824 $ 313,134 Less: interest 23,187 55,434 Present value of lease liabilities 15,369 154,390 Less: current lease liabilities 1,839 16,856 Long-term lease liabilities $ 13,530 $ 137,534 Rental expense and income in accordance with Topic 840 as of December 26, 2018 was comprised of the following: Fiscal Year Ended December 26, 2018 (In thousands) Rental expense: Included as a component of occupancy: Base rents $ 10,272 Contingent rents 3,074 Included as a component of costs of franchise and license revenue: Base rents 15,108 Contingent rents 2,629 Total rental expense $ 31,083 Rental income: Included as a component of franchise and license revenue: Base rents $ 22,831 Contingent rents 4,662 Total rental income $ 27,493 |
Leases | Leases Lessee Our operations utilize property, facilities and equipment leased from others. Buildings and facilities are primarily used for restaurants and support facilities. Many of our restaurants are operated under lease arrangements which generally provide for a fixed base rent, and, in many instances, contingent rent based on a percentage of gross revenues. Initial terms of land and restaurant building leases generally range from 10 to 20 years, exclusive of options to renew, which are typically for five year periods. Leases of equipment consist primarily of restaurant equipment, computer equipment and vehicles. Initial terms of equipment leases generally range from three Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. The components of lease costs were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease costs Finance lease costs: Amortization of right-of-use assets Depreciation and amortization $ 1,870 $ 2,991 Interest on lease liabilities Interest expense, net 3,129 4,536 Operating lease costs: Operating lease costs - company Occupancy 6,432 8,253 Operating lease costs - franchise Costs of franchise and license revenue 18,682 17,097 Operating lease costs - general and administrative General and administrative expenses 100 108 Operating lease costs - closed stores Restructuring charges and exit costs 173 — Variable lease costs: Variable lease costs - company Occupancy 2,854 5,993 Variable lease costs - franchise Costs of franchise and license revenue 6,102 7,001 Variable lease costs - general and administrative General and administrative expenses 61 41 Variable lease costs - closed stores Restructuring charges and exit costs 56 49 Sublease income: Sublease income - franchise Franchise and license revenue (30,925) (28,986) Sublease income - closed stores Restructuring charges and exit costs (114) (306) Total lease costs $ 8,420 $ 16,777 Lease terms and discount rates were as follows: December 30, 2020 December 25, 2019 Weighted-average remaining lease term (in years): Finance leases 9.3 9.7 Operating leases 10.7 10.8 Weighted-average discount rate: Finance leases 23.8 % 23.5 % Operating leases 5.8 % 5.9 % The components of lease income were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease income Operating lease income - franchise Franchise and license revenue $ 33,621 $ 28,050 Operating lease income - closed stores Restructuring charges and exit costs 66 255 Variable lease income - franchise Franchise and license revenue 8,246 10,464 Variable lease income - closed stores Restructuring charges and exit costs 48 49 Total lease income $ 41,981 $ 38,818 Cash and supplemental noncash amounts were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 3,129 $ 4,536 Operating cash flows from operating leases $ 23,511 $ 26,329 Financing cash flows from finance leases $ 1,570 $ 2,464 Right-of-use assets obtained in exchange for new finance lease liabilities $ 142 $ 305 Right-of-use assets obtained in exchange for new operating lease liabilities $ 4,831 $ 79,534 Maturities of lease liabilities and receipts in accordance with Topic 842 as of December 30, 2020 were as follows: Lease Liabilities Lease Receipts Finance Operating Operating (In thousands) 2021 $ 4,737 $ 25,184 $ 31,732 2022 4,343 22,381 28,792 2023 3,778 20,146 26,210 2024 3,171 18,621 24,704 2025 3,163 17,453 24,248 Thereafter 19,364 106,039 177,448 Total undiscounted cash flows 38,556 209,824 $ 313,134 Less: interest 23,187 55,434 Present value of lease liabilities 15,369 154,390 Less: current lease liabilities 1,839 16,856 Long-term lease liabilities $ 13,530 $ 137,534 Rental expense and income in accordance with Topic 840 as of December 26, 2018 was comprised of the following: Fiscal Year Ended December 26, 2018 (In thousands) Rental expense: Included as a component of occupancy: Base rents $ 10,272 Contingent rents 3,074 Included as a component of costs of franchise and license revenue: Base rents 15,108 Contingent rents 2,629 Total rental expense $ 31,083 Rental income: Included as a component of franchise and license revenue: Base rents $ 22,831 Contingent rents 4,662 Total rental income $ 27,493 |
Leases | Leases Lessee Our operations utilize property, facilities and equipment leased from others. Buildings and facilities are primarily used for restaurants and support facilities. Many of our restaurants are operated under lease arrangements which generally provide for a fixed base rent, and, in many instances, contingent rent based on a percentage of gross revenues. Initial terms of land and restaurant building leases generally range from 10 to 20 years, exclusive of options to renew, which are typically for five year periods. Leases of equipment consist primarily of restaurant equipment, computer equipment and vehicles. Initial terms of equipment leases generally range from three Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. The components of lease costs were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease costs Finance lease costs: Amortization of right-of-use assets Depreciation and amortization $ 1,870 $ 2,991 Interest on lease liabilities Interest expense, net 3,129 4,536 Operating lease costs: Operating lease costs - company Occupancy 6,432 8,253 Operating lease costs - franchise Costs of franchise and license revenue 18,682 17,097 Operating lease costs - general and administrative General and administrative expenses 100 108 Operating lease costs - closed stores Restructuring charges and exit costs 173 — Variable lease costs: Variable lease costs - company Occupancy 2,854 5,993 Variable lease costs - franchise Costs of franchise and license revenue 6,102 7,001 Variable lease costs - general and administrative General and administrative expenses 61 41 Variable lease costs - closed stores Restructuring charges and exit costs 56 49 Sublease income: Sublease income - franchise Franchise and license revenue (30,925) (28,986) Sublease income - closed stores Restructuring charges and exit costs (114) (306) Total lease costs $ 8,420 $ 16,777 Lease terms and discount rates were as follows: December 30, 2020 December 25, 2019 Weighted-average remaining lease term (in years): Finance leases 9.3 9.7 Operating leases 10.7 10.8 Weighted-average discount rate: Finance leases 23.8 % 23.5 % Operating leases 5.8 % 5.9 % The components of lease income were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease income Operating lease income - franchise Franchise and license revenue $ 33,621 $ 28,050 Operating lease income - closed stores Restructuring charges and exit costs 66 255 Variable lease income - franchise Franchise and license revenue 8,246 10,464 Variable lease income - closed stores Restructuring charges and exit costs 48 49 Total lease income $ 41,981 $ 38,818 Cash and supplemental noncash amounts were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 3,129 $ 4,536 Operating cash flows from operating leases $ 23,511 $ 26,329 Financing cash flows from finance leases $ 1,570 $ 2,464 Right-of-use assets obtained in exchange for new finance lease liabilities $ 142 $ 305 Right-of-use assets obtained in exchange for new operating lease liabilities $ 4,831 $ 79,534 Maturities of lease liabilities and receipts in accordance with Topic 842 as of December 30, 2020 were as follows: Lease Liabilities Lease Receipts Finance Operating Operating (In thousands) 2021 $ 4,737 $ 25,184 $ 31,732 2022 4,343 22,381 28,792 2023 3,778 20,146 26,210 2024 3,171 18,621 24,704 2025 3,163 17,453 24,248 Thereafter 19,364 106,039 177,448 Total undiscounted cash flows 38,556 209,824 $ 313,134 Less: interest 23,187 55,434 Present value of lease liabilities 15,369 154,390 Less: current lease liabilities 1,839 16,856 Long-term lease liabilities $ 13,530 $ 137,534 Rental expense and income in accordance with Topic 840 as of December 26, 2018 was comprised of the following: Fiscal Year Ended December 26, 2018 (In thousands) Rental expense: Included as a component of occupancy: Base rents $ 10,272 Contingent rents 3,074 Included as a component of costs of franchise and license revenue: Base rents 15,108 Contingent rents 2,629 Total rental expense $ 31,083 Rental income: Included as a component of franchise and license revenue: Base rents $ 22,831 Contingent rents 4,662 Total rental income $ 27,493 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 30, 2020 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Revolving loans $ 210,000 $ 240,000 Finance lease obligations 15,369 16,453 Total long-term debt 225,369 256,453 Less current maturities 1,839 1,674 Noncurrent portion of long-term debt $ 223,530 $ 254,779 There are no scheduled maturities of our revolving loans due in 2021. The $210.0 million of revolving loans are due October 26, 2022. Denny’s Corporation and certain of its subsidiaries have a credit facility consisting of a five-year $375 million senior secured revolver (with a $30 million letter of credit sublimit). As of December 30, 2020, we had outstanding revolver loans of $210.0 million and outstanding letters of credit under the senior secured revolver of $17.3 million. These balances resulted in availability of $147.7 million under the credit facility prior to considering the liquidity covenant in our credit facility. Factoring in the liquidity covenant, our availability was $81.6 million. The credit facility is available for working capital, capital expenditures and other general corporate purposes. The credit facility is guaranteed by Denny's and its material subsidiaries and is secured by assets of Denny's and its subsidiaries, including the stock of its subsidiaries (other than our insurance captive subsidiary). During the year, we executed two amendments to our credit agreement, which modified the agreement as described below. On May 13, 2020, we entered into an amendment (the "Second Amendment") to our credit agreement. As a result of the Second Amendment, beginning May 13, 2020 until the date of delivery of our financial statements for the fiscal quarter ending June 30, 2021, the interest rate of the amended credit agreement was increased to LIBOR plus 3.00% and the commitment fee, paid on the unused portion of the credit facility, was increased to 0.40%. During this period, we have supplemental monthly reporting obligations to our lenders and we are prohibited from paying dividends and making stock repurchases and other general investments. Additionally, capital expenditures were to be restricted to $10 million in the aggregate from May 13, 2020 through the fiscal quarter ending March 31, 2021. The Second Amendment temporarily waived certain financial covenants. The consolidated fixed charge coverage ratio was waived until the fiscal quarter ending March 31, 2021, at which point the covenant level was to revert to a minimum of 1.50x. The consolidated leverage ratio covenant was waived until the fiscal quarter ending March 31, 2021, at which point the covenant level was to increase from 4.00x to 4.50x, stepping down to 4.25x in the second quarter of 2021 and 4.00x in the third fiscal quarter of 2021 and thereafter. In addition, the Second Amendment added a monthly minimum liquidity covenant, defined as the sum of unrestricted cash and revolver availability, ranging from $60 million to $70 million, commencing on May 13, 2020 to May 26, 2021. On December 15, 2020, we executed an additional amendment (the “Third Amendment”) to our credit agreement. Commencing with the effective date of the Third Amendment until the date of delivery of the financial statements for the fiscal quarter ending December 29, 2021, the interest rate shall remain LIBOR plus 3.00%. As of the effective date of the Third Amendment, the accordion feature was removed, and the total credit facility commitment was reduced from $400 million to $375 million and will be reduced to $350 million on July 1, 2021. As a result of the decrease in borrowing capacity, we wrote off $0.2 million of deferred financing costs as a component of other nonoperating (income) expense, net in the Consolidated Statements of Operations. Commencing with the effective date of the Third Amendment until the date of delivery of the financial statements for the fiscal quarter ending September 29, 2021, the Company will continue to have supplemental monthly reporting obligations to its lenders and will be prohibited from paying dividends and making stock repurchases and other general investments. Additionally, existing restrictions on capital expenditures of $10 million in the aggregate will remain in effect through March 31, 2021, at which point the restrictions will expand to $12 million in the aggregate through September 29, 2021. The Third Amendment temporarily waives certain financial covenants. The consolidated fixed charge coverage ratio covenant is waived through March 31, 2021, at which point the covenant level will be a minimum of 1.00x, adjusting to 1.25x on July 1, 2021, and 1.50x on September 30, 2021 and thereafter. The consolidated leverage ratio covenant is waived through March 31, 2021, at which point the covenant level will be a maximum of 5.25x, stepping down to 4.75x on July 1, 2021, and 4.00x on September 30, 2021 and thereafter. In addition, the Third Amendment maintains a monthly minimum liquidity covenant, defined as the sum of unrestricted cash and revolver availability, of $70 million, commencing on the effective date until the date of delivery of the financial statements for the fiscal quarter ending September 29, 2021. We were in compliance with all financial covenants as of December 30, 2020. Prior to considering the impact of our interest rate swaps, described below, the weighted-average interest rate on outstanding revolver loans was 3.15% and 3.47% as of December 30, 2020 and December 25, 2019, respectively. Taking into consideration our interest rate swaps that are designated as cash flow hedges, the weighted-average interest rate of outstanding revolver loans was 5.01% and 3.99% as of December 30, 2020 and December 25, 2019, respectively. Interest Rate Hedges We have receive-variable, pay-fixed interest rate swaps to hedge the forecasted cash flows of our floating rate debt. We initially designated the interest rate swaps as cash flow hedges of our exposure to variability in future cash flows attributable to variable interest payments due on forecasted notional amounts. A summary of our interest rate swaps as of December 30, 2020 is as follows: Trade Date Effective Date Maturity Date Notional Amount Fair Value Fixed Rate (In thousands) Swaps designated as March 20, 2015 March 29, 2018 March 31, 2025 $ 120,000 $ 10,698 2.44 % October 1, 2015 March 29, 2018 March 31, 2026 $ 50,000 $ 5,232 2.46 % Dedesignated swaps February 15, 2018 March 31, 2020 December 31, 2033 $ 100,000 (1) $ 60,515 3.19 % Total $ 270,000 $ 76,445 (1) The notional amount of the swaps entered into on February 15, 2018 increases annually beginning September 30, 2020 until they reach the maximum notional amount of $425.0 million on September 28, 2029. Swaps Designated as Cash Flow Hedges To the extent the swaps are highly effective in offsetting the variability of the hedged cash flows, changes in the fair value of the swaps are not included in the Consolidated Statements of Operations but are reported as a component of accumulated other comprehensive loss, net. The interest rate swaps entered into in 2015 are designated as cash flow hedges with unrealized gain and losses recorded as a component of accumulated other comprehensive loss, net. As of December 30, 2020, the fair value of swaps designated as cash flow hedges was $15.9 million and was recorded as a component of other noncurrent liabilities with an offsetting amount (before taxes) recorded as a component of accumulated other comprehensive loss, net in our Consolidated Balance Sheets. See Note 18 for the amounts recorded in accumulated other comprehensive loss related to the interest rate swaps. We expect to reclassify approximately $3.9 million from accumulated other comprehensive loss, net to interest expense, net in our Consolidated Statements of Operations related to swaps designated as cash flow hedges during the next twelve months. Dedesignated Interest Rate Hedges During the quarter ended June 24, 2020, we determined that a portion of the underlying cash flows related to our hedging relationship entered into in 2018 (“2018 Swaps”) were no longer probable of occurring over the term of the interest rate swaps as a result of the ongoing impacts of the COVID-19 pandemic and using proceeds from our share offering described in Note 18 to repay a portion of our long-term debt. Accordingly, during the quarter ended June 24, 2020, we dedesignated the cash flow relationship and discontinued hedge accounting treatment for the 2018 Swaps. As a result, we reclassified approximately $7.4 million of losses from accumulated other comprehensive loss, net to other nonoperating expense (income), net in our Consolidated Statements of Operations for the year ended December 30, 2020 related to the portion of the forecasted transaction no longer considered probable of occurring. The determination of the amount reclassified was based on credit default curve and recovery rate assumptions applied to forecasted balances of variable rate debt. The remaining amounts of unrealized losses related to the 2018 Swaps are included in accumulated other comprehensive loss, net and are amortized into the Consolidated Statements of Operations as a component of interest expense, net over the remaining term of the 2018 Swaps. For the year ended December 30, 2020, we reclassified unrealized losses of approximately $0.8 million to interest expense, net related to the 2018 Swaps. At December 30, 2020, approximately $64.4 million (before taxes) of unrealized losses remained in accumulated other comprehensive loss, net. As a result of the dedesignated cash flow relationship related to the 2018 Swaps, changes in the fair value of the 2018 Swaps are recorded as a component of other nonoperating expense (income), net in our Consolidated Statements of Operations. For the year ended December 30, 2020, we recorded income of approximately $10.3 million as a component of nonoperating expense (income) related to the 2018 Swaps resulting from changes in fair value. As of December 30, 2020, the fair value of the dedesignated interest rate swaps was $60.5 million, $0.3 million of which was recorded as a component of other current liabilities and $60.2 million of which was recorded as a component of other noncurrent liabilities in our Consolidated Balance Sheets. We expect to amortize approximately $0.2 million from accumulated other comprehensive loss, net to interest expense, net in our Consolidated Statements of Operations related to dedesignated interest rate swaps during the next twelve months. |
Revenues
Revenues | 12 Months Ended |
Dec. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | RevenuesOur revenues are derived primarily from two sales channels, which we operate as one segment: company restaurants and franchised and licensed restaurants. The following table disaggregates our revenue by sales channel and type of good or service: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Company restaurant sales $ 118,160 $ 306,377 $ 411,932 Franchise and license revenue: Royalties 67,501 108,813 101,557 Advertising revenue 53,745 81,144 78,308 Initial and other fees 7,332 6,541 6,422 Occupancy revenue 41,867 38,514 31,960 Franchise and license revenue 170,445 235,012 218,247 Total operating revenue $ 288,605 $ 541,389 $ 630,179 Company restaurant sales decreased from $411.9 million in 2018 to $118.2 million in 2020, primarily as a result of impact of the sale of company restaurants to franchisees and, during 2020, the impact of the COVID-19 pandemic. Franchise and license revenue increased from $218.2 million in 2018 to $235.0 million in 2019 primarily as a result of the impact of the sale of company restaurants to franchisees. The decrease in franchise and licenses revenue to $170.4 million in 2020 is primarily the result of the impact of the COVID-19 pandemic. Many of our company and franchised and licensed restaurants were temporarily closed and most of the restaurants that remained open had limited operations during 2020 resulting in significant declines in revenues. Balances related to contracts with customers consists of receivables, deferred franchise revenue and deferred gift card revenue. See Note 3 for details on our receivables. Deferred franchise revenue consists primarily of the unamortized portion of initial franchise fees that are currently being amortized into revenue and amounts related to development agreements and unopened restaurants that will begin amortizing into revenue when the related restaurants are opened. Deferred franchise revenue represents our remaining performance obligations to our franchisees, excluding amounts of variable consideration related to sales-based royalties and advertising. The components of the change in deferred franchise revenue are as follows: (In thousands) Balance, December 25, 2019 $ 23,256 Fees received from franchisees 868 Revenue recognized (1) (3,318) Balance, December 30, 2020 20,806 Less current portion included in other current liabilities 1,997 Deferred franchise revenue included in other noncurrent liabilities $ 18,809 (1) Of this amount $3.2 million was included in the deferred franchise revenue balance as of December 25, 2019. As of December 30, 2020, the deferred franchise revenue expected to be recognized in the future is as follows: (In thousands) 2021 $ 1,997 2022 1,893 2023 1,812 2024 1,760 2025 1,690 Thereafter 11,654 Deferred franchise revenue $ 20,806 Deferred gift card liabilities consist of the unredeemed portion of gift cards sold in company restaurants and at third party locations. The balance of deferred gift card liabilities represents our remaining performance obligations to our customers. The balance of deferred gift card liabilities as of December 30, 2020 and December 25, 2019 was $6.1 million and $6.5 million, respectively. During the year ended December 30, 2020, we recognized revenue of $0.4 million from gift card redemptions at company restaurants. Financial Statement Impact of Adoption Upon adoption of Topic 606, we recorded a cumulative effect adjustment related to previously recognized initial franchise fees resulting in a $21.0 million increase to deferred franchise revenue, a $15.6 million increase to opening deficit and a $5.4 million increase to deferred tax assets. The deferred franchise revenue resulting from the cumulative effect adjustment will be amortized over the remaining lives of the individual franchise agreements. Also upon adoption, we recorded a cumulative effect adjustment to recognize breakage in proportion to redemptions that occurred prior to December 28, 2017 resulting in a decrease of $0.6 million to gift card liability (a component of other current liabilities), a $0.5 million increase to accrued advertising (a component of other current liabilities) and a $0.1 million decrease to opening deficit. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 30, 2020 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans We maintain defined contribution plans and defined benefit plans which cover a substantial number of employees. Defined Contribution Plans Eligible employees can elect to contribute up to 25% of their compensation to our 401(k) plan. Effective January 1, 2016, the plan was amended and restated to incorporate Safe Harbor Plan design features which included changes to participant eligibility, company contribution amounts and vesting. As a result, we match up to a maximum of 4% of compensation deferred by the participant. In addition, a non-qualified deferred compensation plan is offered to certain employees. This plan allows participants to defer up to 50% of annual salary and up to 75% of bonuses and incentive compensation awards, on a pre-tax basis. There are no matching contributions made under this plan. We made total contributions of $1.5 million, $1.9 million and $2.2 million for 2020, 2019 and 2018, respectively, under these plans. Defined Benefit Plans Benefits under our defined benefit plans are based upon each employee’s years of service and average salary. The following table provides a reconciliation of the changes in the benefit obligations, plan assets, and funded status of our defined benefit plans: December 30, 2020 December 25, 2019 (In thousands) Change in Benefit Obligation: Benefit obligation at beginning of year $ 2,337 $ 2,393 Interest cost 41 81 Actuarial losses 448 25 Benefits paid (151) (162) Settlements (377) — Benefit obligation at end of year $ 2,298 $ 2,337 Accumulated benefit obligation $ 2,298 $ 2,337 Change in Plan Assets: Fair value of plan assets at beginning of year $ — $ — Employer contributions 528 162 Benefits paid (151) (162) Settlements (377) — Fair value of plan assets at end of year $ — $ — Unfunded status at end of year $ (2,298) $ (2,337) Amounts recognized on the balance sheet: Other current liabilities $ (717) $ (662) Other noncurrent liabilities (1,581) (1,675) Net amount recognized $ (2,298) $ (2,337) Amounts in accumulated other comprehensive loss not yet reflected in net period benefit cost: Unamortized actuarial losses, net $ (1,087) $ (823) Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive loss: Benefit obligation actuarial loss $ (448) $ (25) Amortization of net loss 89 86 Settlement loss recognized 95 — Other comprehensive income (loss) $ (264) $ 61 The components of net periodic benefit cost were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Interest cost $ 41 $ 81 $ 76 Amortization of net loss 89 86 112 Settlement loss recognized 95 — — Net periodic benefit cost $ 225 $ 167 $ 188 Assumptions The discount rates used to determine the benefit obligations as of December 30, 2020 and December 25, 2019 were 1.34% and 2.56%, respectively. The discount rates used to determine net period pension costs for 2020, 2019 and 2018 were 2.56%, 3.83% and 3.08%, respectively. In determining the discount rate, we have considered long-term bond indices of bonds having similar timing and amounts of cash flows as our estimated defined benefit payments. We use a yield curve based on high quality, long-term corporate bonds to calculate the single equivalent discount rate that results in the same present value as the sum of each of the plan’s estimated benefit payments discounted at their respective spot rates. Contributions and Expected Future Benefit Payments We made contributions of $0.5 million and $0.2 million to our defined benefit plans during the years ended December 30, 2020 and December 25, 2019, respectively. We expect to contribute $0.7 million to our defined benefit plans during 2021. Benefits expected to be paid for each of the next five years and in the aggregate for the five fiscal years from 2026 through 2030 are as follows: Defined Benefit Plans (In thousands) 2021 $ 716 2022 406 2023 550 2024 122 2025 100 2026 through 2030 413 |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation Share-Based Compensation Plans We maintain four share-based compensation plans under which stock options and other awards granted to our employees and directors are outstanding. Currently, the Denny’s Corporation 2017 Omnibus Incentive Plan (the “2017 Omnibus Plan”) is used to grant share-based compensation to selected employees, officers and directors of Denny’s and its affiliates. However, we reserve the right to pay discretionary bonuses, or other types of compensation, outside of this plan. At December 30, 2020, there were 2.0 million shares available for grant under the 2017 Omnibus Plan. In addition, we have 0.7 million shares available to be issued outside of the 2017 Omnibus Plan pursuant to the grant or exercise of employment inducement awards of stock options and restricted stock units in accordance with NASDAQ Listing Rule 5635(c)(4). Share-Based Compensation Expense Total share-based compensation expense included as a component of net income (loss) was as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Employee share awards $ 7,104 $ 5,765 $ 5,039 Restricted stock units for board members 844 929 999 Total share-based compensation $ 7,948 $ 6,694 $ 6,038 The income tax benefits recognized as a component of the provision for (benefit from) income taxes in our Consolidated Statements of Operations related to share-based compensation expense were approximately $2.0 million, $1.7 million and $1.6 million during the years ended December 30, 2020, December 25, 2019 and December 26, 2018, respectively. Employee Share Awards Employee share awards consist of performance share units and restricted stock units (which are equity classified). Prior to fiscal 2020, we primarily granted performance share units (“PSUs”) containing a market condition based on the total shareholder return of our stock compared with the returns of a group of peer companies and performance share units containing a performance condition based on the Company’s achievement of certain operating metrics. The number of shares that are ultimately issued is dependent upon the level of obtainment of the market and performance conditions. The following table summarizes the employee share awards activity during the year ended December 30, 2020: Units Weighted Average Grant Date (In thousands) Outstanding, beginning of year 1,681 $ 16.22 Granted 824 $ 10.47 Vested (829) $ 11.84 Forfeited (113) $ 16.25 Cancellations due to modification (522) $ 16.83 Reissuance due to modification 522 $ 9.04 Outstanding, end of year 1,563 $ 12.91 Convertible, end of year 577 $ 14.92 During the year ended December 30, 2020, as a component of our annual compensation program, we granted certain employees approximately 0.8 million restricted stock units with a weighted average grant date fair value of $10.47 per share that vest over a two-year period, as defined under the terms of the award. The vesting period for these restricted stock units is the two-year period beginning May 20, 2020 through May 20, 2022. Modification of Performance Share Units On September 30, 2020, the Company’s Board of Directors (the "Board") approved adjustments to certain PSUs granted to employees as part of the Company’s Long-Term Incentive Program. Awards for 2018 and 2019 were originally made 100% in the form of PSUs with three-year performance periods (2018-2020 for the 2018 PSUs and 2019-2021 for the 2019 PSUs). The PSUs are earned based 50% on growth in earnings per share over the performance period (“EPS Growth”) and 50% on the relative total stockholder return of the Company for the performance period against a peer group for the 2018 awards and against the S&P 600 Consumer Discretionary Index for the 2019 awards (“Relative TSR”). The full service dining sector in which the Company operates has been severely negatively impacted by business disruptions resulting from the COVID-19 pandemic. These business disruptions, which could not have been foreseen when the 2018 and 2019 PSUs were awarded, have caused the EPS Growth goals for the PSUs to be unattainable. To address the loss of retentive and incentive value due to these unforeseen events, the Board approved the following adjustments to the 2018 and 2019 PSUs: 2018 PSUs The EPS Growth goal for the 2018 PSUs was measured in accordance with the methodology established at the time of grant for the first two years of the performance period, 2018-2019, before the onset of the COVID-19 pandemic. That performance was above the maximum goal that had been set. That portion of the award was then prorated by two-thirds (since two-thirds of the performance period had been completed before the pandemic). The modification impacts approximately 0.2 million PSUs with a fair value of approximately $2.4 million at the modification date based on the grant date fair value of $10.00, the market value of our stock on the date of grant. The modified award equals 100% of target (i.e., 150% performance times two-thirds). The modified award vested and was expensed during the year ended December 30, 2020 (the remaining term of the original award). Prior to the modification, the fair value of the award was zero. 2019 PSUs The Board removed the 2019-2021 EPS Growth goal and will instead apply the 2019-2021 Relative TSR goal to that portion of the award. The modification impacts approximately 0.3 million PSUs with a fair value of approximately $2.3 million at the modification date. As these awards contain a market condition, a Monte Carlo valuation was used to determine the modification date fair value of $8.24 per share. The modified award will vest and be expensed over the fifteen-month period ending December 29, 2021 (the remaining term of the original award), subject to continued employment. Prior to the modification, the fair value of the award was zero. The Board did not change the existing Relative TSR portion of either award. These adjustments were accounted for as modifications beginning in the fourth quarter of 2020. For 2020, 2019 and 2018, the weighted average grant date fair value of awards granted was $10.47, $19.02 and $16.97, respectively. We made payments of $0.2 million, $0.4 million and $0.2 million in cash during 2020, 2019 and 2018, respectively, related to converted performance share units. Payments relate to the payment of payroll taxes. The intrinsic value of units converted was $12.0 million, $16.9 million and $9.8 million during 2020, 2019 and 2018, respectively. As of December 30, 2020 and December 25, 2019, we had accrued compensation of $0.1 million and $0.1 million, respectively, included as a component of other current liabilities and $0.2 million and $0.2 million, respectively, included as a component of other noncurrent liabilities in our Consolidated Balance Sheets, which represents future estimated payroll taxes. As of December 30, 2020, we had $8.8 million of unrecognized compensation cost related to unvested performance share unit awards granted, which is expected to be recognized over a weighted average of 1.3 years. Restricted Stock Units for Board Members During the year ended December 30, 2020, we granted less than 0.1 million restricted stock units (which are equity classified) with a weighted average grant date fair value of $10.43 per unit to non-employee members of our Board. The restricted stock units vest after a one year service period. A director may elect to convert these awards into shares of common stock on a specific date in the future (while still serving as a member of our Board), upon termination as a member of our Board or in three equal annual installments commencing after termination of service as a member of our Board. During the year ended December 30, 2020, less than 0.1 million restricted stock units were converted into shares of common stock. There were 0.8 million and 0.7 million restricted stock units outstanding as of December 30, 2020 and December 25, 2019, respectively. As of December 30, 2020, we had approximately $0.3 million of unrecognized compensation cost related to all unvested restricted stock unit awards outstanding, which is expected to be recognized over a weighted average of 0.4 years. Stock Options Prior to 2012, stock options were granted that vest evenly over three years, have a 10-year contractual life and are issued at the market value at the date of grant. There were no options granted in 2020, 2019 or 2018. The following table summarizes information about stock options outstanding and exercisable at December 30, 2020: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate (In thousands, except per share amounts) Outstanding, beginning of year 140 $ 3.89 Exercised (110) $ 3.89 Outstanding, end of year 30 $ 3.89 0.1 $ 305 Exercisable, end of year 30 $ 3.89 0.1 $ 305 The total intrinsic value of the options exercised was $0.8 million, $6.6 million and $4.9 million during the years ended December 30, 2020, December 25, 2019 and December 26, 2018, respectively. |
Refranchisings and Acquisitions
Refranchisings and Acquisitions | 12 Months Ended |
Dec. 30, 2020 | |
Refranchisings and Acquisitions [Abstract] | |
Refranchisings and Acquisitions | Refranchisings and Acquisitions Refranchisings The following table summarizes the activity related to our refranchising and development strategy. Gains (losses) on the sales of company restaurants and real estate are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. See Note 14. Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (Dollars in thousands) Restaurants sold to franchisees — 105 8 Gains (losses) on sales of company restaurants: Cash Proceeds $ — $ 118,964 $ 1,777 Receivables — 920 — Less: Property sold — (30,511) (2,448) Less: Goodwill — (2,897) (62) Less: Intangibles — (2,260) (13) Less: Deferred gain — (1,350) — Total gains (losses) on sales of company restaurants $ — $ 82,866 $ (746) Real estate parcels sold 10 6 — Gains on sales of real estate: Cash proceeds $ 9,419 $ 10,680 $ — Noncash consideration — 3,000 — Less: Property sold (3,648) (1,686) — Less: Other assets (835) (120) — Total gains on sales of real estate $ 4,936 $ 11,874 $ — No restaurants were sold to franchisees during 2020 as we completed our transition to a more franchise-based model during 2019. The majority of gains on sales of real estate during 2019 qualified for like-kind exchange treatment related to real estate acquired. In addition to the cash proceeds received on the sale of real estate during 2019, we also recorded additional noncash consideration for the fair value of restaurant space we expect to receive within a building being developed by the buyer of the real estate. The fair value of this space was determined using a market approach with Level 2 inputs based on third party appraisals of fair values of other similar properties. The $3.0 million of noncash consideration is recorded as a component of other noncurrent assets in our Consolidated Balance Sheets as of December 30, 2020 and December 25, 2019. As of December 30, 2020, we have recorded assets held for sale at their carrying amount of $1.1 million (consisted of property of $1.0 million, other assets of $0.1 million) related to two parcels of real estate. There were $1.9 million in assets held for sale, at their carrying value, as of December 25, 2019 (consisted of property of $1.6 million, other assets of $0.2 million and goodwill of $0.1 million) related to four company restaurants and two pieces of real estate. Acquisitions We account for the acquisition of franchised restaurants using the acquisition method of accounting for business combinations. The purchase price allocations were based on Level 3 fair value estimates. The following table summarizes our restaurant and real estate acquisition activity. Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (Dollars in thousands) Restaurants acquired from franchisees — — 6 Purchase price allocation: Reacquired franchise rights $ — $ — $ 5,434 Property — — 1,121 Goodwill — — 1,574 Total purchase price $ — $ — $ 8,129 Finance leases recorded $ — $ — $ 2,409 Real estate parcels acquired — 5 1 Total purchase price $ — $ 11,320 $ 1,787 |
Operating (Gains), Losses and O
Operating (Gains), Losses and Other Charges, Net | 12 Months Ended |
Dec. 30, 2020 | |
Other Income and Expenses [Abstract] | |
Operating (Gains), Losses and Other Charges, Net | Operating (Gains), Losses and Other Charges, Net Operating (gains), losses and other charges, net consists of the following: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Gains on sales of assets and other, net $ (4,678) $ (93,608) $ (513) Restructuring charges and exit costs 2,403 2,428 1,575 Impairment charges 4,083 — 1,558 Operating (gains), losses and other charges, net $ 1,808 $ (91,180) $ 2,620 Gains on sales of assets and other, net of $4.7 million for the year ended December 30, 2020 were primarily related to the sales of parcels of real estate. Gains on sales of assets and other, net of $93.6 million for the year ended December 25, 2019 were primarily the result of sales of company restaurants and real estate as part of our refranchising and development strategy. See Note 13 for details on refranchisings. Gains on sales of assets and other, net of $0.5 million for the year ended December 26, 2018 primarily related to gains of $1.2 million of insurance settlements on fire-damaged and hurricane-damaged restaurants, partially offset by $0.7 million of losses on sales of company owned units to franchisees. Restructuring charges and exit costs consists of the following: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Exit costs $ 204 $ 272 $ 518 Severance and other restructuring charges 2,199 2,156 1,057 Total restructuring charges and exit costs $ 2,403 $ 2,428 $ 1,575 Exit costs primarily consists of costs related to closed restaurants. Exit cost liabilities were $0.1 million and $0.2 million as of December 30, 2020 and December 25, 2019, respectively. Exit cost liabilities related to lease costs are included as a component of operating lease liabilities in our Consolidated Balance Sheets. See Note 8. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provisions for (benefits from) income taxes were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Current: Federal $ (3,497) $ 12,421 $ (632) State and local (109) 5,156 1,833 Foreign 667 1,142 1,042 Deferred: Federal 393 9,944 5,432 State and local 3,588 6,061 761 (Decrease) increase of valuation allowance (3,041) (2,935) 121 Total provision for (benefit from) income taxes $ (1,999) $ 31,789 $ 8,557 The reconciliation of income taxes at the U.S. federal statutory tax rate to our effective tax rate was as follows: December 30, 2020 December 25, 2019 December 26, 2018 Statutory provision rate 21 % 21 % 21 % State, foreign and local taxes, net of federal income tax benefit (11) 8 6 Change in state valuation allowance (1) (2) — General business credits generated 9 (2) (5) Foreign tax credits generated 2 (1) (2) Carryback of net operating loss rate differential 12 — — Section 162(m) and share-based compensation (11) (3) (3) Insurance premiums 5 — — Other 2 — (1) Effective tax rate 28 % 21 % 16 % For 2020, the difference in the overall effective rate from the U.S. statutory rate was primarily due to state and foreign taxes and the generation of employment credits. The 2020 rate was also impacted by a $0.9 million benefit from the statutory rate differential due to a net operating loss carryback to a prior year and an expense of $1.0 million from disallowed compensation deductions. For 2019, there was no significant difference between our effective tax rate and the statutory tax rate of 21%. The impact of state taxes on the statutory rate was partially offset by the generation of employment and foreign tax credits. In addition, the 2019 rate benefited $2.0 million related to share-based compensation and $2.0 million related to the completion of an Internal Revenue Service federal income audit of the 2016 tax year. The 2018 rate was primarily impacted by the statutory tax rate reduction under the Tax Cuts and Jobs Act of 2017. For 2018, the difference in the overall effective rate from the U.S. statutory rate was primarily due to state taxes and the generation of employment and foreign tax credits. In addition, the 2018 rate benefited $1.4 million from items related to share-based compensation. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law as a response to the economic impacts of the COVID-19 pandemic. As a result of the CARES Act, the Company is allowed to carryback a current year net operating loss to years 2015 and forward, to obtain approximately $2.1 million in federal income tax refunds. See Note 16 for a discussion of other items related to the CARES Act. The following table represents the approximate tax effect of each significant type of temporary difference that resulted in deferred income tax assets or liabilities. December 30, 2020 December 25, 2019 (In thousands) Deferred tax assets: Self-insurance accruals $ 3,315 $ 4,202 Finance lease liabilities 1,369 1,263 Operating lease liabilities 39,555 43,497 Accrued exit cost 25 48 Interest rate swaps 19,806 11,491 Pension, other retirement and compensation plans 10,638 10,549 Deferred income 5,337 4,688 General business and foreign tax credit carryforwards - state and federal 2,782 2,945 Net operating loss carryforwards - state 5,888 9,621 Charitable contribution carryforwards - federal and state 161 — Total deferred tax assets before valuation allowance 88,876 88,304 Less: valuation allowance (7,223) (10,264) Total deferred tax assets 81,653 78,040 Deferred tax liabilities: Intangible assets (14,579) (14,858) Deferred finance costs (86) (211) Operating lease right-of-use assets (35,732) (40,751) Fixed assets (7,679) (6,711) Other accruals (367) (791) Total deferred tax liabilities (58,443) (63,322) Net deferred tax asset $ 23,210 $ 14,718 The Company’s state net operating loss tax asset of approximately $5.9 million includes $4.6 million related to South Carolina. The $3.0 million change in the valuation allowance primarily relates to the expiration of South Carolina net operating loss carryforwards that may never be utilized. Of the $7.2 million valuation allowance, $4.4 million related to South Carolina net operating loss carryforwards, $1.5 million relates to California enterprise zone credits and $0.3 million relates to foreign tax credit carryforwards, all of which may never be utilized. It is more likely than not that we will be able to utilize all of our existing temporary differences and most of our remaining state tax net operating losses and state credit tax carryforwards, net of existing valuation allowance, prior to their expiration. The following table provides a reconciliation of the beginning and ending amount of unrecognized tax benefits: December 30, 2020 December 25, 2019 (In thousands) Balance, beginning of year $ 1,047 $ 2,940 Decrease related to prior-year tax positions — (1,893) Balance, end of year $ 1,047 $ 1,047 There was no interest expense associated with unrecognized tax benefits for the years ended December 30, 2020 and December 25, 2019. We file income tax returns in the U.S. federal jurisdictions and various state jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2016. We completed our federal audit by the Internal Revenue Service for tax year 2016 during 2019. We remain subject to examination for U.S. federal taxes for 2017, 2018 and 2019 and in the following major state jurisdictions: California (2016-2020), Florida (2017-2020) and Texas (2016-2020). |
Other CARES Act Provisions
Other CARES Act Provisions | 12 Months Ended |
Dec. 30, 2020 | |
Unusual or Infrequent Items, or Both [Abstract] | |
Other CARES Act Provisions | Other CARES Act Provisions The CARES Act allowed eligible employers to claim employee retention tax credits (“ERTC”) for qualified wages paid after March 12, 2020 and before January 1, 2021. We qualified for the credit for the entire period subsequent to March 12, 2020 under the provisions of the CARES Act as (1) our business operations were fully or partially suspended due to government COVID-related orders limiting our business and (2) our gross receipts during a calendar quarter in 2020 were below 50% of the gross receipts for the same calendar quarter in 2019 and our sales never returned to 80% of 2019’s sales in any quarter within 2020. The amount of the credit for 2020 is 50% of qualified wages paid not to exceed $10,000 per person during 2020. The total amount of credits recorded in 2020 related to the ERTC was $2.6 million, of which $0.9 million was included as a component of costs of company restaurant sales and $1.7 million was included as a component of general and administrative expenses in our Consolidated Statement of Operations for the year ended December 30, 2020. In addition, as allowed under the CARES Act, we have deferred $3.1 million of our portion of FICA taxes. We expect to pay the amounts deferred in 2021. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 30, 2020 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share The amounts used for the basic and diluted net income (loss) per share calculations are summarized below: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands, except per share amounts) Net income (loss) $ (5,116) $ 117,410 $ 43,693 Weighted average shares outstanding - basic 60,812 59,944 63,364 Effect of dilutive share-based compensation awards — 1,889 2,198 Weighted average shares outstanding - diluted 60,812 61,833 65,562 Basic net income (loss) per share $ (0.08) $ 1.96 $ 0.69 Diluted net income (loss) per share $ (0.08) $ 1.90 $ 0.67 Anti-dilutive share-based compensation awards (1) 1,682 270 — |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 30, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Share Repurchases We suspended share repurchases as of February 27, 2020 and terminated our previously approved Rule 10b5-1 Repurchase Plan effective March 16, 2020 in light of uncertain market conditions arising from the COVID-19 pandemic. Under our amended credit agreement, we are prohibited, until the date of delivery of our financial statements for the fiscal quarter ending September 29, 2021, from making any stock repurchases. Over the past several years, our Board has approved share repurchase programs authorizing us to repurchase up to a set amount of shares or dollar amount of our common stock. Under the programs, we may, from time to time, purchase shares in the open market (including pre-arranged stock trading plans in accordance with guidelines specified in Rule 10b5-1 under the Securities Exchange Act of 1934, as amended) or in privately negotiated transactions, subject to market and business conditions. During 2019, 2017 and 2016, the Board approved share repurchase programs for $250 million, $200 million and $100 million of our common stock, respectively. During 2020, we repurchased a total of 1.7 million shares of our common stock for approximately $34.2 million, thus completing the 2017 repurchase program. During 2019, including the settlement of the 2018 accelerated share repurchase (“ASR”) agreement, we repurchased a total of 5.3 million shares of our common stock for approximately $103.0 million. During 2018, including shares repurchased under the 2018 ASR, we repurchased a total of 3.9 million shares of our common stock for $61.2 million. As of December 30, 2020, there was approximately $248.0 million remaining under the 2019 repurchase program. In recent years, as part of our previously authorized share repurchase programs, we have entered into variable term, capped ASR agreements to repurchase our common stock. Pursuant to the terms of these ASR agreements, we pay cash, receive an initial delivery of shares of our common stock (which represents the minimum shares to be delivered based on the cap price) and record treasury stock related to these shares. The remaining balance is recorded as an equity forward contract. When settled, the final delivery of shares is received and treasury stock is recorded related to the additional shares. The total number of shares repurchased is based on a combined discounted volume-weighted average price (“VWAP”) per share, which is determined based on the average of the daily VWAP of our common stock, less a fixed discount, over the term of the ASR agreement. In November 2018, we entered into a $25 million ASR agreement with MUFG (the “2018 ASR”). We paid $25 million in cash and received approximately 1.1 million shares of our common stock (which represents the minimum shares to be delivered based on the cap price) and recorded $18.2 million of treasury stock related to these shares. The remaining balance of $6.8 million was recorded as additional paid-in capital in shareholders’ deficit as of December 26, 2018 as an equity forward contract. During 2019, we settled the 2018 ASR agreement, recording $6.8 million of treasury stock related to the final delivery of an additional 0.4 million shares of our common stock based on a combined discounted VWAP of $17.04 per share. Repurchased shares as of December 25, 2019, are included as treasury stock in our Consolidated Balance Sheets and our Consolidated Statements of Shareholders’ Deficit. Retirement of Treasury Stock In the fourth quarter of fiscal 2020, the Board approved the retirement of 54.0 million shares of Treasury stock at a weighted average share price of $10.26. As of year end December 30, 2020, no shares remained in treasury. Issuance and Sale of Common Stock On July 1, 2020, the Company entered into an underwriting agreement with Wells Fargo Securities, LLC, as representative of the several underwriters named therein, for the issuance and sale by the Company of 8,000,000 shares of its common stock, par value $0.01 per share, in an underwritten public offering at a price to the public of $9.15 per share. On July 6, 2020, the Company received net proceeds of $69.6 million from the sale of shares, after deducting the underwriters' discounts and commissions and offering expenses. Accumulated Other Comprehensive Loss The components of the change in accumulated other comprehensive loss were as follows: Pensions Derivatives Accumulated Other Comprehensive Loss (In thousands) Balance as of December 27, 2017 $ (982) $ (1,334) $ (2,316) Benefit obligation actuarial gain 96 — 96 Amortization of net loss (1) 112 — 112 Changes in the fair value of cash flow derivatives — (2,595) (2,595) Reclassification of cash flow derivatives to interest expense, net (2) — 307 307 Income tax (expense) benefit (53) 303 250 Balance as of December 26, 2018 $ (827) $ (3,319) $ (4,146) Benefit obligation actuarial loss (25) — (25) Amortization of net loss (1) 86 — 86 Changes in the fair value of cash flow derivatives — (40,486) (40,486) Reclassification of cash flow derivatives to interest expense, net (2) — 291 291 Income tax (expense) benefit (15) 10,335 10,320 Balance as of December 25, 2019 $ (781) $ (33,179) $ (33,960) Benefit obligation actuarial loss (448) — (448) Amortization of net loss (1) 89 — 89 Settlement loss recognized 95 — 95 Changes in the fair value of cash flow derivatives — (46,910) (46,910) Reclassification of cash flow derivatives to interest expense, net (2) — 3,160 3,160 Reclassification of loss related to dedesignation of derivatives to other nonoperating expense (income) (3) — 7,354 7,354 Amortization of unrealized losses related to dedesignated derivatives to interest expense, net (3) — 783 783 Income tax benefit 67 9,365 9,432 Balance as of December 30, 2020 $ (978) $ (59,427) $ (60,405) (1) Before-tax amount that was reclassified from accumulated other comprehensive loss and included as a component of pension expense within general and administrative expenses in our Consolidated Statements of Operations. See Note 11 for additional details. (2) Amounts reclassified from accumulated other comprehensive loss into income represent payments made to the counterparty for the effective portions of the interest rate swaps. These amounts are included as a component of interest expense in our Consolidated Statements of Operations. We expect to reclassify approximately $3.9 million from accumulated other comprehensive loss related to our interest rate swaps during the next twelve months. See Note 9 for additional details. (3) During the quarter ended June 24, 2020, we dedesignated the cash flow relationship and discontinued hedge accounting treatment for the 2018 Swaps. As a result, we reclassified approximately $7.4 million of losses from accumulated other comprehensive loss, net to other nonoperating expense (income), net in our Consolidated Statements of Operations related to the portion of forecasted transaction no longer considered probable of occurring. The remaining losses related to the 2018 Swaps will continue to be included in accumulated other comprehensive loss, net and will be amortized as a component of interest expense, net in our Consolidated Statements of Operations over the remaining term of the 2018 Swaps. For the year ended December 30, 2020, we amortized approximately $0.8 million of losses to interest expense, net related to the 2018 Swaps. We expect to amortize approximately $0.2 million from accumulated other comprehensive loss related to our interest rate swaps during the next twelve months. See Note 9 for additional details. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies There are various claims and pending legal actions against or indirectly involving us, incidental to and arising out of the ordinary course of the business. In the opinion of management, based upon information currently available, the ultimate liability with respect to these proceedings and claims will not materially affect the Company’s consolidated results of operations or financial position. We have amounts payable under purchase contracts for food and non-food products. Many of these agreements do not obligate us to purchase any specific volumes and include provisions that would allow us to cancel such agreements with appropriate notice. Our future purchase obligation payments due by period for both company and franchised restaurants at December 30, 2020 consist of the following: (In thousands) Less than 1 year $ 155,631 1-2 years — 3-4 years — 5 years and thereafter — Total $ 155,631 For agreements with cancellation provisions, amounts included in the table above represent our estimate of purchase obligations during the periods presented if we were to cancel these contracts with appropriate notice. We would likely take delivery of goods under such circumstances. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 30, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Income taxes paid, net $ 6 $ 24,147 $ 3,254 Interest paid $ 15,889 $ 17,792 $ 19,447 Noncash investing and financing activities: Noncash consideration received in connection $ — $ 3,000 $ — Notes received in connection with disposition of property $ — $ 920 $ — Accrued purchase of property $ 133 $ 1,791 $ 178 Insurance proceeds receivable $ — $ 48 $ 653 Issuance of common stock, pursuant to share-based compensation plans $ 7,949 $ 7,522 $ 4,671 Execution of finance leases $ 142 $ 305 $ 3,623 Treasury stock payable $ — $ 1,816 $ 72 |
Quarterly Data (Unaudited)
Quarterly Data (Unaudited) | 12 Months Ended |
Dec. 30, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Data (Unaudited) | Quarterly Data (Unaudited) The results for each quarter include all adjustments which, in our opinion, are necessary for a fair presentation of the results for interim periods. All adjustments are of a normal and recurring nature. Selected consolidated financial data for each quarter of fiscal 2020 and 2019 are set forth below: Fiscal Year Ended December 30, 2020 (1) First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) Company restaurant sales $ 42,291 $ 15,128 $ 27,849 $ 32,892 Franchise and licensing revenue 54,404 25,033 43,795 47,213 Total operating revenue 96,695 40,161 71,644 80,105 Total operating costs and expenses 78,649 53,688 68,404 81,185 Operating income (loss) $ 18,046 $ (13,527) $ 3,240 $ (1,080) Net income (loss) $ 9,013 $ (22,965) $ 6,477 $ 2,359 Basic net income (loss) per share (2) $ 0.16 $ (0.41) $ 0.10 $ 0.04 Diluted net income (loss) per share (2) $ 0.16 $ (0.41) $ 0.10 $ 0.04 Fiscal Year Ended December 25, 2019 (3) First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) Company restaurant sale $ 98,545 $ 95,447 $ 63,582 $ 48,803 Franchise and licensing revenue 52,866 56,437 60,676 65,033 Total operating revenue 151,411 151,884 124,258 113,836 Total operating costs and expenses 127,280 105,769 56,084 87,273 Operating income $ 24,131 $ 46,115 $ 68,174 $ 26,563 Net income $ 15,490 $ 34,239 $ 49,122 $ 18,559 Basic net income per share (2) $ 0.25 $ 0.57 $ 0.83 $ 0.32 Diluted net income per share (2) $ 0.24 $ 0.55 $ 0.80 $ 0.31 (1) During 2020, the COVID-19 pandemic had a significant adverse impact on the Company’s business performance, results of operations and cash flows. The fiscal year ended December 30, 2020 includes 53 weeks of operations compared with 52 weeks for all other years presented. (2) Per share amounts do not necessarily sum to the total year amounts due to changes in shares outstanding and rounding. (3) During 2019, the Company migrated from a 90% franchised business model to one that is 96% franchised by selling company owned restaurants to franchisees which resulted in, among other items, a reduction in revenues and the recording of approximately $82.9 million of gains. In addition, the Company also recorded an additional $11.9 million of gains related to the sale of real estate. See Note 13 and Note 14 for details. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 30, 2020 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates . In preparing our Consolidated Financial Statements in conformity with U.S. generally accepted accounting principles (GAAP), management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities, revenues, expenses and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially from these estimates. |
Consolidation Policy | Consolidation Policy . Our Consolidated Financial Statements include the financial statements of Denny’s Corporation and its wholly-owned subsidiaries: Denny’s, Inc., DFO, LLC, Denny’s Realty, LLC and East Main Insurance Company. All significant intercompany balances and transactions have been eliminated in consolidation. |
Fiscal Year | Fiscal Year . |
Cash and Cash Equivalents | Cash and Cash Equivalents. |
Receivables | Receivables. Effective December 26, 2019, the first day of fiscal 2020, we adopted Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” and all subsequent ASUs that modified Topic 326. The new guidance replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform financial statement users of credit loss estimates. |
Inventories | Inventories. Inventories consist primarily of food and beverages and are valued at the lower of first-in, first-out cost or net realizable value. |
Property and Depreciation | Property and Depreciation. Owned property is stated at cost. Property under finance leases is stated at the lesser of its fair value or the net present value of the related minimum lease payments at the lease inception. Maintenance and repairs are expensed as incurred. We depreciate owned property over its estimated useful life using the straight-line method. We amortize property held under finance leases (at capitalized value) over the lesser of its estimated useful life or the lease term. Building assets are assigned estimated useful lives that range from five two five |
Goodwill | Goodwill. Amounts recorded as goodwill primarily represent excess reorganization value recognized as a result of our 1998 bankruptcy. We also record goodwill in connection with the acquisition of restaurants from franchisees. Likewise, upon the sale of restaurant operations to franchisees, goodwill is decremented. We test goodwill for impairment at each fiscal year end and more frequently if circumstances indicate impairment may exist. Such indicators include, but are not limited to, a significant decline in our expected future cash flows, a significant adverse decline in our stock price, significantly adverse legal developments and a significant change in the business climate. |
Intangible Assets | Intangible Assets . Intangible assets consist primarily of trade names and reacquired franchise rights. Trade names are considered indefinite-lived intangible assets and are not amortized. Reacquired franchise rights are amortized using the straight-line basis over the term of the related franchise agreement. Reacquired franchise rights resulting from acquisitions are accounted for using the purchase method of accounting and are estimated by management based on the fair value of the assets received. We test trade name assets for impairment at each fiscal year end, and more frequently if circumstances indicate impairment may exist. We assess impairment of reacquired franchise rights whenever changes or events indicate that the carrying value may not be recoverable. Costs incurred to renew or extend the term of recognized intangible assets are recorded in general and administrative expenses in our Consolidated Statements of Operations. |
Marketable Securities | Marketable Securities. Marketable securities included in investments consist of available for sale equity instruments and are recorded at fair market value in our Consolidated Balance Sheets. Marketable securities included in other noncurrent assets consist of trading debt and equity mutual funds and are recorded at fair market value in our Consolidated Balance Sheets. These securities represent the plan assets of our nonqualified deferred compensation plan (the “plan assets”). The plan assets are held in a rabbi trust. Each plan participant’s account consists of their contribution, our matching contribution (made prior to 2016) and each participant’s share of earnings or losses in the plan. We have recorded offsetting deferred compensation liabilities as a component of other noncurrent liabilities in our Consolidated Balance Sheets.The realized and unrealized holding gains and losses related to marketable securities are recorded in other income (expense) with an offsetting amount recorded in general and administrative expenses related to deferred compensation plan liabilities. |
Deferred Financing Costs | Deferred Financing Costs. Costs related to the issuance of debt are deferred and amortized as a component of interest expense using the effective interest method over the terms of the respective debt issuances. |
Self-insurance Liabilities | Self-insurance Liabilities. We record liabilities for insurance claims during periods in which we have been insured under large deductible programs or have been self-insured for our medical claims and workers’ compensation, general, product and automobile insurance liabilities. The liabilities represent estimated incurred losses. These estimates include assumptions regarding claims frequency and severity as well as changes in our business environment, medical costs and the regulatory environment that could impact our overall self-insurance costs. |
Income Taxes | Income Taxes. We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. All deferred taxes are reported as noncurrent in our Consolidated Balance Sheets. A valuation allowance reduces our net deferred tax asset to the amount that is more likely than not to be realized. We make certain estimates and judgments in the calculation of our provision for incomes taxes, in the resulting tax liabilities, and in the recoverability of deferred tax assets. |
Leases and Subleases, Lessee | Leases and Subleases. Effective December 27, 2018, the first day of fiscal 2019, we adopted Accounting Standards Update (“ASU”) 2016-02, “Leases (Topic 842)” and all subsequent ASUs that modified Topic 842. Upon adoption of Topic 842, we recorded operating lease liabilities of $101.3 million and ROU assets of $94.2 million related to existing operating leases. In addition, we recorded a cumulative effect adjustment increasing opening deficit by $0.4 million and deferred tax assets by $0.1 million. See Note 8 for further information about our transition to Topic 842 and the required disclosures. Lessee We lease certain real estate and equipment for our restaurants and support facilities. At contract inception, we determine whether a contract is, or contains, a lease by determining whether it conveys the right to control the use of the identified asset for a period of time. We recognize a lease liability and a right-of-use (“ROU”) asset at the lease commencement date. For operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. For finance leases, the lease liability is initially measured in the same manner and date as for operating leases, and is subsequently measured at amortized cost using the effective interest method. Operating lease ROU assets are initially and subsequently measured throughout the lease term at the carrying amount of the lease liability adjusted for initial direct costs, prepayments, accrued payments and lease incentives, if any. Lease cost is recognized on a straight-line basis over the lease term. Operating lease payments are classified as cash flows for operating activities with ROU asset amortization and the change in the lease liability combined as "Operating lease assets/liabilities" in the reconciliation of net income (loss) to net cash flows provided by (used in) operating activities in the Consolidated Statement of Cash Flows. Finance lease ROU assets are initially measured at cost and subsequently amortized on a straight-line basis over the lesser of the useful life or the lease term. Finance lease payments are classified as cash flows used in financing activities in the Consolidated Statement of Cash Flows. Operating and finance lease ROU assets are assessed for impairment using long-lived assets impairment guidance. We use a consistent lease term for calculating the depreciation period for the related assets, classifying the lease and computing periodic rent expense where the lease terms include escalations in rent over the lease term. The new lease guidance provides practical expedients and accounting elections for our ongoing accounting after adoption. We elected the practical expedient to not separate nonlease components (such as common area maintenance) from lease components in regard to all leases and the portfolio approach in applying the discount rate to our leases. Key estimates and judgments include how we determine (1) lease payments, (2) lease term and (3) the discount rate used to discount the unpaid lease payments to present value. We have certain lease agreements structured with both a fixed base rent and a contingent rent based on a percentage of sales over contractual levels, others with only contingent rent based on a percentage of sales and some with a fixed base rent adjusted periodically for inflation or changes in the fair market rent rate. Contingent rent is recognized as sales occur. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. The exercise of lease renewal options is at our sole discretion, except in certain sublease situations in which we have determined that it is reasonably certain that one or more options will be exercised, including where the exercise of a sublease option compels us to exercise the renewal option of the underlying master lease. Renewal option periods are included in the measurement of lease ROU asset and lease liability where the exercise is reasonably certain to occur. The discount rate used to determine the present value of the lease payments is our estimated collateralized incremental borrowing rate, based on the yield curve for the respective lease terms, as we generally cannot determine the interest rate implicit in the lease. |
Lessor | Lessor We lease or sublease certain restaurant properties to our franchisees and occasionally to third parties. The lease descriptions, terms, variable lease payments and renewal options are the same as the lessee leases described above. Contingent rental income is recognized when earned. Similar to our lessee accounting, we elected the lessor practical expedient to not separate nonlease components from lease components in regard to all leases. |
Employee Benefit Plans | Employee Benefit Plans. Each year we measure and recognize the funded status of our defined benefit plans in our Consolidated Balance Sheets as of December 31. That date represents the month-end that is closest to our fiscal year-end. The funded status is adjusted for any contributions or significant events (such as a plan amendment, settlement, or curtailment that calls for a remeasurement) that occurs between our fiscal year-end and December 31. |
Derivative Instruments | Derivative Instruments. We use derivative financial instruments to manage our exposure to interest rate risk. We do not enter into derivative instruments for trading or speculative purposes. All derivatives are recognized on our Consolidated Balance Sheets at fair value. Changes in the fair values of derivatives are recorded in earnings or other comprehensive income ( “ OCI ” |
Contingencies and Litigation | Contingencies and Litigation. We are subject to legal proceedings involving ordinary and routine claims incidental to our business, as well as legal proceedings that are nonroutine and include compensatory or punitive damage claims. Our ultimate legal and financial liability with respect to such matters cannot be estimated with certainty and requires the use of estimates in recording liabilities for potential litigation settlements. When the reasonable estimate is a range, the recorded loss will be the best estimate within the range. We record legal settlement costs as other operating expenses in our Consolidated Statements of Operations as those costs are incurred. |
Comprehensive Income (Loss) | Comprehensive Income (Loss). Comprehensive income (loss) includes net income (loss) and OCI items that are excluded from net income (loss) under U.S. generally accepted accounting principles. OCI items include additional minimum pension liability adjustments, the effective unrealized portion of changes in the fair value of cash flow hedges, and the reclassification and amortization of loss related to the dedesignation of cash flow derivatives. |
Segment | Segment. Denny’s operates in only one segment. All significant revenues and pre-tax earnings relate to retail sales of food and beverages to the general public through either company or franchised restaurants. |
Revenues | Revenues. Effective December 28, 2017, the first day of fiscal 2018, we adopted ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” and all subsequent ASUs that modified Topic 606. We elected to apply the modified retrospective method of adoption to those contracts which were not completed as of December 28, 2017. In doing so, we applied the practical expedient to aggregate all contract modifications that occurred before December 28, 2017 in determining the satisfied and unsatisfied performance obligations, the transaction price and the allocation of the transaction price to the satisfied and unsatisfied performance obligations. Company Restaurant Revenue. Company restaurant revenue is recognized at the point in time when food and beverage products are sold at company restaurants. We present company restaurant sales net of sales-related taxes collected from customers and remitted to governmental taxing authorities. Franchise Revenue. Franchise and license revenues consist primarily of royalties, advertising revenue, initial and other fees and occupancy revenue. Under franchise agreements we provide franchisees with a license of our brand’s symbolic intellectual property, administration of advertising programs (including local co-operatives), and other ongoing support functions. These services are highly interrelated so we do not consider them to be individually distinct performance obligations, and therefore account for them as a single performance obligation. Revenue from franchise agreements is recognized evenly over the term of the agreement with the exception of sales-based royalties. Royalty and advertising revenues represent sales-based royalties that are recognized in the period in which the sales occur. Sales-based royalties are variable consideration related to our performance obligation to our franchisees to maintain the intellectual property being licensed. Under our franchise agreements, franchisee advertising contributions must be spent on marketing and related activities. Advertising revenues and expenditures are recorded on a gross basis within the Consolidated Statements of Operations. Initial and other fees include initial, successor and assignment franchise fees (“initial franchise fees”). Initial franchise fees are billed and received upon the signing of the franchise agreement. Recognition of these fees is deferred until the commencement date of the agreement and occurs over time based on the term of the underlying franchise agreement. In the event a franchise agreement is terminated, any remaining deferred fees are recognized in the period of termination. Initial and other fees also include revenue that are distinct from the franchise agreement and are separate performance obligations. Training and other franchise services fees are billed and recognized at a point in time as services are rendered. Similar to advertising revenue, other franchise services fees are recorded on a gross basis within the Consolidated Statements of Operations. Occupancy revenue results from leasing or subleasing restaurants to franchisees and is recognized over the term of the lease agreement. |
Advertising Costs | Advertising Costs . |
Restructuring and Exit Costs | Restructuring and Exit Costs. Restructuring and exit costs are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. Restructuring costs consist primarily of severance and other restructuring charges for terminated employees. Prior to the adoption of Topic 842, exit costs consisted primarily of the costs of future obligations related to closed restaurants. Discounted liabilities for future lease costs and the fair value of related subleases of closed restaurants were recorded when the restaurants were closed. All other costs related to closed restaurants were expensed as incurred. As a result of the adoption of Topic 842, exit cost liabilities related to operating lease costs are now included as a component of operating lease liabilities in our Consolidated Balance Sheets. Amounts recorded as exit costs include period costs related to closed units. |
Disposal or Impairment of Long-lived Assets | Disposal or Impairment of Long-lived Assets. We evaluate our long-lived assets for impairment at the restaurant level on a quarterly basis, when assets are identified as held for sale or whenever changes or events indicate that the carrying value may not be recoverable. For assets identified as held for sale, we use the market approach and consider proceeds from similar asset sales. We assess impairment of restaurant-level assets based on the operating cash flows of the restaurant, expected proceeds from the sale of assets and our plans for restaurant closings. For underperforming assets, we use the income approach to determine both the recoverability and estimated fair value of the assets. To estimate future cash flows, we make certain assumptions about expected future operating performance, such as revenue growth, operating margins, risk-adjusted discount rates, and future economic and market conditions. If the long-lived assets of a restaurant are not recoverable based upon estimated future, undiscounted cash flows, we write the assets down to their fair value. If these estimates or their related assumptions change in the future, we may be required to record additional impairment charges. These charges are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. |
Discontinued Operations | Discontinued Operations. We evaluate restaurant closures and assets reclassified to assets held for sale for potential disclosure as discontinued operations. Only disposals resulting in a strategic shift that will have a major effect on our operations and financial results are reported as discontinued operations. There have been no such disposals, nor any disposals of individually significant components. The gains and losses related to restaurant closures and assets reclassified to assets held for sale are included as a component of operating (gain), losses and other charges, net in our Consolidated Statements of Operations. |
Gains and Losses on Sales of Restaurants Operations to Franchisees, Real Estate and Other Assets | Gains and Losses on Sales of Restaurants Operations to Franchisees, Real Estate and Other Assets. Generally, gains and losses on sales of restaurant operations to franchisees (which may include real estate), real estate properties and other assets are recognized when the sales are consummated and certain other gain recognition criteria are met. Total gains and losses are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. |
Share-based Compensation | Share-based Compensation. Share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. Share-based compensation expense is included as a component of general and administrative expenses in our Consolidated Statements of Operations. We account for forfeitures as they occur. Excess tax benefits recognized related to share-based compensation are included as a component of provision for (benefit from) income taxes in our Consolidated Statements of Operations and are classified as operating activities in our Consolidated Statements of Cash Flows. Generally, compensation expense related to performance share units and restricted stock units for board members is based on the number of units granted, the period over which they are expected to vest and the fair market value of our common stock on the date of the grant. For restricted stock units and performance share units that contain a market condition, compensation expense is based on the Monte Carlo valuation method, which utilizes multiple input variables to determine the probability of the Company achieving the market condition and the fair value of the award. The key assumptions used include expected volatility and risk-free interest rates over the term of the award. Subsequent to the vesting period, earned stock-settled restricted stock units and performance share units (both of which are equity classified) are paid to the holder in shares of our common stock, provided the holder was still employed with Denny’s or an affiliate as of the vesting date. |
Earnings Per Share | Earnings Per Share . Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and potential common shares outstanding during the period. |
Newly Adopted Accounting Standards and Accounting Standards to be Adopted | Newly Adopted Accounting Standards Effective December 26, 2019, the first day of fiscal 2020, we adopted ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The new guidance replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform financial statement users of credit loss estimates. The adoption of this guidance did not have a material impact on our Consolidated Financial Statements. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. The new guidance provides optional guidance, for a limited time, to ease the potential burden in accounting for or recognizing the effects of reference rate reform on financial reporting. ASU 2020-04 is effective for a limited time, from March 12, 2020 through December 31, 2022. The Company adopted this ASU on March 12, 2020. The adoption of ASU 2020-04 did not have a significant impact on the Company’s consolidated financial position or results of operations. In April 2020, the FASB staff issued interpretive guidance that indicated it would be acceptable for entities to make an election to account for lease concessions related to the effects of the COVID-19 pandemic consistent with how those concessions would be accounted for under ASU 2016-02, “Leases (Topic 842): Targeted Improvements”, as though enforceable rights and obligations for those concessions existed (regardless of whether those enforceable rights and obligations for the concessions explicitly exist in the contract). Consequently, for concessions related to the effects of the COVID-19 pandemic, an entity will not have to analyze each contract to determine whether enforceable rights and obligations for concessions exist in the contract and can elect to apply or not apply the lease modification guidance in Topic 842 to those contracts. This election is available for concessions related to the effects of the COVID-19 pandemic that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee. We have elected to apply this interpretive guidance to the rent relief we have secured, and have assumed that enforceable rights and obligations for those concessions exist in the lease contract. As such, starting in April 2020, we began recognizing abatements or deferrals in rents received from landlords as reductions in variable lease payments. This election will continue while these abatement or deferrals are in effect. Additional new accounting guidance became effective for us as of December 26, 2019 that we reviewed and concluded was either not applicable to our operations or had no material effect on our Consolidated Financial Statements and related disclosures. Accounting Standards to be Adopted In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”, which modifies Topic 740 to simplify the accounting for income taxes. ASU 2019-12 is effective for financial statements issued for annual periods beginning after December 15, 2020, and for the interim periods therein. The adoption of ASU 2019-12 is not expected to have a significant impact on the Company’s consolidated financial position or results of operations. We reviewed all other newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on our Consolidated Financial Statements as a result of future adoption. |
Introduction and Basis of Rep_2
Introduction and Basis of Reporting (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Changes in Restaurant Counts | Changes in restaurant counts are as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 Company restaurants, beginning of period 68 173 178 Units opened — — 1 Units acquired from franchisees — — 6 Units sold to franchisees — (105) (8) Units closed (3) — (4) End of period 65 68 173 Franchised and licensed restaurants, beginning of period 1,635 1,536 1,557 Units opened 20 30 29 Units purchased from Company — 105 8 Units acquired by Company — — (6) Units closed (70) (36) (52) End of period 1,585 1,635 1,536 Total restaurants, end of period 1,650 1,703 1,709 |
Receivables (Tables)
Receivables (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Receivables [Abstract] | |
Schedule of Receivables, Net | Receivables, net consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Receivables, net: Trade accounts receivable from franchisees $ 15,535 $ 14,551 Other receivables from franchisees 2,104 2,230 Vendor receivables 2,199 3,260 Credit card receivables 542 6,806 Other 2,668 915 Allowance for doubtful accounts (1,699) (274) Total receivables, net $ 21,349 $ 27,488 Other noncurrent assets: Financing receivables from franchisees $ 502 $ 364 |
Property (Tables)
Property (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Net | Property, net consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Land $ 36,815 $ 39,720 Buildings and leasehold improvements 160,842 172,881 Other property and equipment 35,080 32,470 Total property 232,737 245,071 Less accumulated depreciation 146,583 147,445 Property, net $ 86,154 $ 97,626 The following table reflects the property assets, included in the table above, and buildings with finance leases which were leased to franchisees: December 30, 2020 December 25, 2019 (In thousands) Land $ 25,192 $ 27,205 Buildings and leasehold improvements 69,656 78,584 Total property owned, leased to franchisees 94,848 105,789 Less accumulated depreciation 59,038 65,476 Property owned, leased to franchisees, net 35,810 40,313 Buildings held under finance leases, leased to franchisees 8,062 8,445 Less accumulated amortization 4,137 3,768 Property held under finance leases, leased to franchisees, net 3,925 4,677 Total property leased to franchisees, net $ 39,735 $ 44,990 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amounts of Goodwill | The following table reflects the changes in carrying amounts of goodwill: December 30, 2020 December 25, 2019 (In thousands) Balance, beginning of year $ 36,832 $ 39,781 Adjustments related to the sale of restaurants 52 (2,949) Balance, end of year $ 36,884 $ 36,832 |
Schedule of Indefinite-Lived Intangible Assets | Intangible assets consist of the following: December 30, 2020 December 25, 2019 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (In thousands) Intangible assets with indefinite lives: Trade names $ 44,087 $ — $ 44,087 $ — Liquor licenses 120 — 120 — Intangible assets with definite lives: Reacquired franchise rights 12,218 4,866 15,516 5,767 Intangible assets $ 56,425 $ 4,866 $ 59,723 $ 5,767 |
Schedule of Finite-Lived Intangible Assets | Intangible assets consist of the following: December 30, 2020 December 25, 2019 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (In thousands) Intangible assets with indefinite lives: Trade names $ 44,087 $ — $ 44,087 $ — Liquor licenses 120 — 120 — Intangible assets with definite lives: Reacquired franchise rights 12,218 4,866 15,516 5,767 Intangible assets $ 56,425 $ 4,866 $ 59,723 $ 5,767 |
Schedule of Estimated Amortization Expense for Intangible Assets With Definite Lives | Estimated amortization expense for intangible assets with definite lives in the next five years is as follows: (In thousands) 2021 $ 1,333 2022 1,226 2023 902 2024 832 2025 776 |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Current Liabilities | Other current liabilities consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Accrued payroll $ 17,076 $ 19,689 Accrued insurance, primarily current portion of liability for insurance claims 4,667 6,515 Accrued taxes 4,850 5,624 Accrued advertising 4,318 6,753 Gift cards 6,127 6,469 Other 9,424 12,257 Other current liabilities $ 46,462 $ 57,307 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis are summarized below: Total Quoted Prices in Active Markets for Identical Assets/Liabilities Significant Other Observable Inputs Significant Unobservable Inputs (In thousands ) Fair value measurements as of December 30, 2020: Deferred compensation plan investments (1) $ 13,627 $ 13,627 $ — $ — Interest rate swaps, net (2) (76,445) — (76,445) — Investments (3) 2,272 — 2,272 — Total $ (60,546) $ 13,627 $ (74,173) $ — Fair value measurements as of December 25, 2019: Deferred compensation plan investments (1) $ 13,517 $ 13,517 $ — $ — Interest rate swaps (2) (44,670) — (44,670) — Investments (3) 3,649 — 3,649 — Total $ (27,504) $ 13,517 $ (41,021) $ — (1) The fair values of our deferred compensation plan investments are based on the closing market prices of the elected investments. (2) The fair values of our interest rate swaps are based upon Level 2 inputs, which include valuation models. The key inputs for the valuation models are quoted market prices, interest rates and forward yield curves. See Note 9 for details on the interest rate swaps. (3) The fair value of investments is valued using a readily determinable net asset value per share based on the fair value of the underlying securities. There are no significant redemption restrictions associated with these investments. |
Fair Value Measurements, Nonrecurring | Those assets and liabilities measured at fair value on a nonrecurring basis are summarized below: Significant Unobservable Inputs Impairment Charges (In thousands) Fair value measurements as of December 30, 2020: Assets held and used (1) $ 2,425 $ 1,564 (1) At December 30, 2020, impaired assets were written down to their fair value. To determine fair value, we used the income approach, which assumes that the future cash flows reflect current market expectations. These fair value measurements require significant judgment using Level 3 inputs, such as discounted cash flows from operations, which are not observable from the market, directly or indirectly. There is uncertainty in the projected future cash flows used in the Company's impairment analysis, which requires the use of estimates and assumptions. If actual performance does not achieve the projections, or if the assumptions used change in the future, we may be required to recognize impairment charges in future periods. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Leases [Abstract] | |
Schedule of Components of Lease Costs and Lease Terms and Discount Rates | The components of lease costs were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease costs Finance lease costs: Amortization of right-of-use assets Depreciation and amortization $ 1,870 $ 2,991 Interest on lease liabilities Interest expense, net 3,129 4,536 Operating lease costs: Operating lease costs - company Occupancy 6,432 8,253 Operating lease costs - franchise Costs of franchise and license revenue 18,682 17,097 Operating lease costs - general and administrative General and administrative expenses 100 108 Operating lease costs - closed stores Restructuring charges and exit costs 173 — Variable lease costs: Variable lease costs - company Occupancy 2,854 5,993 Variable lease costs - franchise Costs of franchise and license revenue 6,102 7,001 Variable lease costs - general and administrative General and administrative expenses 61 41 Variable lease costs - closed stores Restructuring charges and exit costs 56 49 Sublease income: Sublease income - franchise Franchise and license revenue (30,925) (28,986) Sublease income - closed stores Restructuring charges and exit costs (114) (306) Total lease costs $ 8,420 $ 16,777 Lease terms and discount rates were as follows: December 30, 2020 December 25, 2019 Weighted-average remaining lease term (in years): Finance leases 9.3 9.7 Operating leases 10.7 10.8 Weighted-average discount rate: Finance leases 23.8 % 23.5 % Operating leases 5.8 % 5.9 % Cash and supplemental noncash amounts were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 3,129 $ 4,536 Operating cash flows from operating leases $ 23,511 $ 26,329 Financing cash flows from finance leases $ 1,570 $ 2,464 Right-of-use assets obtained in exchange for new finance lease liabilities $ 142 $ 305 Right-of-use assets obtained in exchange for new operating lease liabilities $ 4,831 $ 79,534 |
Schedule of Components of Lease Income | The components of lease income were as follows: Fiscal Year Ended Classification December 30, 2020 December 25, 2019 (In thousands) Lease income Operating lease income - franchise Franchise and license revenue $ 33,621 $ 28,050 Operating lease income - closed stores Restructuring charges and exit costs 66 255 Variable lease income - franchise Franchise and license revenue 8,246 10,464 Variable lease income - closed stores Restructuring charges and exit costs 48 49 Total lease income $ 41,981 $ 38,818 |
Schedule of Finance Lease Liability Maturity | Maturities of lease liabilities and receipts in accordance with Topic 842 as of December 30, 2020 were as follows: Lease Liabilities Lease Receipts Finance Operating Operating (In thousands) 2021 $ 4,737 $ 25,184 $ 31,732 2022 4,343 22,381 28,792 2023 3,778 20,146 26,210 2024 3,171 18,621 24,704 2025 3,163 17,453 24,248 Thereafter 19,364 106,039 177,448 Total undiscounted cash flows 38,556 209,824 $ 313,134 Less: interest 23,187 55,434 Present value of lease liabilities 15,369 154,390 Less: current lease liabilities 1,839 16,856 Long-term lease liabilities $ 13,530 $ 137,534 |
Schedule of Lessee Lease Liability Maturity | Maturities of lease liabilities and receipts in accordance with Topic 842 as of December 30, 2020 were as follows: Lease Liabilities Lease Receipts Finance Operating Operating (In thousands) 2021 $ 4,737 $ 25,184 $ 31,732 2022 4,343 22,381 28,792 2023 3,778 20,146 26,210 2024 3,171 18,621 24,704 2025 3,163 17,453 24,248 Thereafter 19,364 106,039 177,448 Total undiscounted cash flows 38,556 209,824 $ 313,134 Less: interest 23,187 55,434 Present value of lease liabilities 15,369 154,390 Less: current lease liabilities 1,839 16,856 Long-term lease liabilities $ 13,530 $ 137,534 |
Schedule of Lessor Operating Lease Payments to be Received Maturity | Maturities of lease liabilities and receipts in accordance with Topic 842 as of December 30, 2020 were as follows: Lease Liabilities Lease Receipts Finance Operating Operating (In thousands) 2021 $ 4,737 $ 25,184 $ 31,732 2022 4,343 22,381 28,792 2023 3,778 20,146 26,210 2024 3,171 18,621 24,704 2025 3,163 17,453 24,248 Thereafter 19,364 106,039 177,448 Total undiscounted cash flows 38,556 209,824 $ 313,134 Less: interest 23,187 55,434 Present value of lease liabilities 15,369 154,390 Less: current lease liabilities 1,839 16,856 Long-term lease liabilities $ 13,530 $ 137,534 |
Schedule of Rental Expense and Income | Rental expense and income in accordance with Topic 840 as of December 26, 2018 was comprised of the following: Fiscal Year Ended December 26, 2018 (In thousands) Rental expense: Included as a component of occupancy: Base rents $ 10,272 Contingent rents 3,074 Included as a component of costs of franchise and license revenue: Base rents 15,108 Contingent rents 2,629 Total rental expense $ 31,083 Rental income: Included as a component of franchise and license revenue: Base rents $ 22,831 Contingent rents 4,662 Total rental income $ 27,493 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt consisted of the following: December 30, 2020 December 25, 2019 (In thousands) Revolving loans $ 210,000 $ 240,000 Finance lease obligations 15,369 16,453 Total long-term debt 225,369 256,453 Less current maturities 1,839 1,674 Noncurrent portion of long-term debt $ 223,530 $ 254,779 |
Schedule of Interest Rate Swaps | A summary of our interest rate swaps as of December 30, 2020 is as follows: Trade Date Effective Date Maturity Date Notional Amount Fair Value Fixed Rate (In thousands) Swaps designated as March 20, 2015 March 29, 2018 March 31, 2025 $ 120,000 $ 10,698 2.44 % October 1, 2015 March 29, 2018 March 31, 2026 $ 50,000 $ 5,232 2.46 % Dedesignated swaps February 15, 2018 March 31, 2020 December 31, 2033 $ 100,000 (1) $ 60,515 3.19 % Total $ 270,000 $ 76,445 (1) The notional amount of the swaps entered into on February 15, 2018 increases annually beginning September 30, 2020 until they reach the maximum notional amount of $425.0 million on September 28, 2029. |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table disaggregates our revenue by sales channel and type of good or service: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Company restaurant sales $ 118,160 $ 306,377 $ 411,932 Franchise and license revenue: Royalties 67,501 108,813 101,557 Advertising revenue 53,745 81,144 78,308 Initial and other fees 7,332 6,541 6,422 Occupancy revenue 41,867 38,514 31,960 Franchise and license revenue 170,445 235,012 218,247 Total operating revenue $ 288,605 $ 541,389 $ 630,179 |
Components of the Change in Deferred Franchise Revenue | The components of the change in deferred franchise revenue are as follows: (In thousands) Balance, December 25, 2019 $ 23,256 Fees received from franchisees 868 Revenue recognized (1) (3,318) Balance, December 30, 2020 20,806 Less current portion included in other current liabilities 1,997 Deferred franchise revenue included in other noncurrent liabilities $ 18,809 |
Schedule of Deferred Franchise Revenue Recognition | As of December 30, 2020, the deferred franchise revenue expected to be recognized in the future is as follows: (In thousands) 2021 $ 1,997 2022 1,893 2023 1,812 2024 1,760 2025 1,690 Thereafter 11,654 Deferred franchise revenue $ 20,806 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Retirement Benefits [Abstract] | |
Schedule of Pension and Other Defined Benefit Plan Obligations and Funded Status | The following table provides a reconciliation of the changes in the benefit obligations, plan assets, and funded status of our defined benefit plans: December 30, 2020 December 25, 2019 (In thousands) Change in Benefit Obligation: Benefit obligation at beginning of year $ 2,337 $ 2,393 Interest cost 41 81 Actuarial losses 448 25 Benefits paid (151) (162) Settlements (377) — Benefit obligation at end of year $ 2,298 $ 2,337 Accumulated benefit obligation $ 2,298 $ 2,337 Change in Plan Assets: Fair value of plan assets at beginning of year $ — $ — Employer contributions 528 162 Benefits paid (151) (162) Settlements (377) — Fair value of plan assets at end of year $ — $ — Unfunded status at end of year $ (2,298) $ (2,337) Amounts recognized on the balance sheet: Other current liabilities $ (717) $ (662) Other noncurrent liabilities (1,581) (1,675) Net amount recognized $ (2,298) $ (2,337) Amounts in accumulated other comprehensive loss not yet reflected in net period benefit cost: Unamortized actuarial losses, net $ (1,087) $ (823) Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive loss: Benefit obligation actuarial loss $ (448) $ (25) Amortization of net loss 89 86 Settlement loss recognized 95 — Other comprehensive income (loss) $ (264) $ 61 |
Components of Net Periodic Benefit Cost | The components of net periodic benefit cost were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Interest cost $ 41 $ 81 $ 76 Amortization of net loss 89 86 112 Settlement loss recognized 95 — — Net periodic benefit cost $ 225 $ 167 $ 188 |
Schedule of Expected Benefit Payments | Benefits expected to be paid for each of the next five years and in the aggregate for the five fiscal years from 2026 through 2030 are as follows: Defined Benefit Plans (In thousands) 2021 $ 716 2022 406 2023 550 2024 122 2025 100 2026 through 2030 413 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Total Share-Based Compensation | Total share-based compensation expense included as a component of net income (loss) was as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Employee share awards $ 7,104 $ 5,765 $ 5,039 Restricted stock units for board members 844 929 999 Total share-based compensation $ 7,948 $ 6,694 $ 6,038 |
Schedule of Restricted Stock Units Activity | The following table summarizes the employee share awards activity during the year ended December 30, 2020: Units Weighted Average Grant Date (In thousands) Outstanding, beginning of year 1,681 $ 16.22 Granted 824 $ 10.47 Vested (829) $ 11.84 Forfeited (113) $ 16.25 Cancellations due to modification (522) $ 16.83 Reissuance due to modification 522 $ 9.04 Outstanding, end of year 1,563 $ 12.91 Convertible, end of year 577 $ 14.92 |
Schedule of Stock Options Outstanding and Exercisable | The following table summarizes information about stock options outstanding and exercisable at December 30, 2020: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate (In thousands, except per share amounts) Outstanding, beginning of year 140 $ 3.89 Exercised (110) $ 3.89 Outstanding, end of year 30 $ 3.89 0.1 $ 305 Exercisable, end of year 30 $ 3.89 0.1 $ 305 |
Refranchisings and Acquisitio_2
Refranchisings and Acquisitions (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Refranchisings and Acquisitions [Abstract] | |
Schedule of Activity Related to Our Refranchising and Development Strategy | The following table summarizes the activity related to our refranchising and development strategy. Gains (losses) on the sales of company restaurants and real estate are included as a component of operating (gains), losses and other charges, net in our Consolidated Statements of Operations. See Note 14. Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (Dollars in thousands) Restaurants sold to franchisees — 105 8 Gains (losses) on sales of company restaurants: Cash Proceeds $ — $ 118,964 $ 1,777 Receivables — 920 — Less: Property sold — (30,511) (2,448) Less: Goodwill — (2,897) (62) Less: Intangibles — (2,260) (13) Less: Deferred gain — (1,350) — Total gains (losses) on sales of company restaurants $ — $ 82,866 $ (746) Real estate parcels sold 10 6 — Gains on sales of real estate: Cash proceeds $ 9,419 $ 10,680 $ — Noncash consideration — 3,000 — Less: Property sold (3,648) (1,686) — Less: Other assets (835) (120) — Total gains on sales of real estate $ 4,936 $ 11,874 $ — |
Schedule Restaurant and Real Estate Acquisition Activity | The following table summarizes our restaurant and real estate acquisition activity. Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (Dollars in thousands) Restaurants acquired from franchisees — — 6 Purchase price allocation: Reacquired franchise rights $ — $ — $ 5,434 Property — — 1,121 Goodwill — — 1,574 Total purchase price $ — $ — $ 8,129 Finance leases recorded $ — $ — $ 2,409 Real estate parcels acquired — 5 1 Total purchase price $ — $ 11,320 $ 1,787 |
Operating (Gains), Losses and_2
Operating (Gains), Losses and Other Charges, Net (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of Operating (Gains) Losses and Other Charges Net | Operating (gains), losses and other charges, net consists of the following: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Gains on sales of assets and other, net $ (4,678) $ (93,608) $ (513) Restructuring charges and exit costs 2,403 2,428 1,575 Impairment charges 4,083 — 1,558 Operating (gains), losses and other charges, net $ 1,808 $ (91,180) $ 2,620 |
Schedule of Restructuring Charges and Exit Costs | Restructuring charges and exit costs consists of the following: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Exit costs $ 204 $ 272 $ 518 Severance and other restructuring charges 2,199 2,156 1,057 Total restructuring charges and exit costs $ 2,403 $ 2,428 $ 1,575 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provisions for Income Taxes | The provisions for (benefits from) income taxes were as follows: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Current: Federal $ (3,497) $ 12,421 $ (632) State and local (109) 5,156 1,833 Foreign 667 1,142 1,042 Deferred: Federal 393 9,944 5,432 State and local 3,588 6,061 761 (Decrease) increase of valuation allowance (3,041) (2,935) 121 Total provision for (benefit from) income taxes $ (1,999) $ 31,789 $ 8,557 |
Schedule of Reconciliation of Income Taxes U.S. Federal Statutory Tax Rate | The reconciliation of income taxes at the U.S. federal statutory tax rate to our effective tax rate was as follows: December 30, 2020 December 25, 2019 December 26, 2018 Statutory provision rate 21 % 21 % 21 % State, foreign and local taxes, net of federal income tax benefit (11) 8 6 Change in state valuation allowance (1) (2) — General business credits generated 9 (2) (5) Foreign tax credits generated 2 (1) (2) Carryback of net operating loss rate differential 12 — — Section 162(m) and share-based compensation (11) (3) (3) Insurance premiums 5 — — Other 2 — (1) Effective tax rate 28 % 21 % 16 % |
Schedule of Deferred Income Tax Assets or Liabilities | The following table represents the approximate tax effect of each significant type of temporary difference that resulted in deferred income tax assets or liabilities. December 30, 2020 December 25, 2019 (In thousands) Deferred tax assets: Self-insurance accruals $ 3,315 $ 4,202 Finance lease liabilities 1,369 1,263 Operating lease liabilities 39,555 43,497 Accrued exit cost 25 48 Interest rate swaps 19,806 11,491 Pension, other retirement and compensation plans 10,638 10,549 Deferred income 5,337 4,688 General business and foreign tax credit carryforwards - state and federal 2,782 2,945 Net operating loss carryforwards - state 5,888 9,621 Charitable contribution carryforwards - federal and state 161 — Total deferred tax assets before valuation allowance 88,876 88,304 Less: valuation allowance (7,223) (10,264) Total deferred tax assets 81,653 78,040 Deferred tax liabilities: Intangible assets (14,579) (14,858) Deferred finance costs (86) (211) Operating lease right-of-use assets (35,732) (40,751) Fixed assets (7,679) (6,711) Other accruals (367) (791) Total deferred tax liabilities (58,443) (63,322) Net deferred tax asset $ 23,210 $ 14,718 |
Summary of Unrecognized Tax Benefits | The following table provides a reconciliation of the beginning and ending amount of unrecognized tax benefits: December 30, 2020 December 25, 2019 (In thousands) Balance, beginning of year $ 1,047 $ 2,940 Decrease related to prior-year tax positions — (1,893) Balance, end of year $ 1,047 $ 1,047 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Income Per Share | The amounts used for the basic and diluted net income (loss) per share calculations are summarized below: Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands, except per share amounts) Net income (loss) $ (5,116) $ 117,410 $ 43,693 Weighted average shares outstanding - basic 60,812 59,944 63,364 Effect of dilutive share-based compensation awards — 1,889 2,198 Weighted average shares outstanding - diluted 60,812 61,833 65,562 Basic net income (loss) per share $ (0.08) $ 1.96 $ 0.69 Diluted net income (loss) per share $ (0.08) $ 1.90 $ 0.67 Anti-dilutive share-based compensation awards (1) 1,682 270 — |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Loss | The components of the change in accumulated other comprehensive loss were as follows: Pensions Derivatives Accumulated Other Comprehensive Loss (In thousands) Balance as of December 27, 2017 $ (982) $ (1,334) $ (2,316) Benefit obligation actuarial gain 96 — 96 Amortization of net loss (1) 112 — 112 Changes in the fair value of cash flow derivatives — (2,595) (2,595) Reclassification of cash flow derivatives to interest expense, net (2) — 307 307 Income tax (expense) benefit (53) 303 250 Balance as of December 26, 2018 $ (827) $ (3,319) $ (4,146) Benefit obligation actuarial loss (25) — (25) Amortization of net loss (1) 86 — 86 Changes in the fair value of cash flow derivatives — (40,486) (40,486) Reclassification of cash flow derivatives to interest expense, net (2) — 291 291 Income tax (expense) benefit (15) 10,335 10,320 Balance as of December 25, 2019 $ (781) $ (33,179) $ (33,960) Benefit obligation actuarial loss (448) — (448) Amortization of net loss (1) 89 — 89 Settlement loss recognized 95 — 95 Changes in the fair value of cash flow derivatives — (46,910) (46,910) Reclassification of cash flow derivatives to interest expense, net (2) — 3,160 3,160 Reclassification of loss related to dedesignation of derivatives to other nonoperating expense (income) (3) — 7,354 7,354 Amortization of unrealized losses related to dedesignated derivatives to interest expense, net (3) — 783 783 Income tax benefit 67 9,365 9,432 Balance as of December 30, 2020 $ (978) $ (59,427) $ (60,405) (1) Before-tax amount that was reclassified from accumulated other comprehensive loss and included as a component of pension expense within general and administrative expenses in our Consolidated Statements of Operations. See Note 11 for additional details. (2) Amounts reclassified from accumulated other comprehensive loss into income represent payments made to the counterparty for the effective portions of the interest rate swaps. These amounts are included as a component of interest expense in our Consolidated Statements of Operations. We expect to reclassify approximately $3.9 million from accumulated other comprehensive loss related to our interest rate swaps during the next twelve months. See Note 9 for additional details. (3) During the quarter ended June 24, 2020, we dedesignated the cash flow relationship and discontinued hedge accounting treatment for the 2018 Swaps. As a result, we reclassified approximately $7.4 million of losses from accumulated other comprehensive loss, net to other nonoperating expense (income), net in our Consolidated Statements of Operations related to the portion of forecasted transaction no longer considered probable of occurring. The remaining losses related to the 2018 Swaps will continue to be included in accumulated other comprehensive loss, net and will be amortized as a component of interest expense, net in our Consolidated Statements of Operations over the remaining term of the 2018 Swaps. For the year ended December 30, 2020, we amortized approximately $0.8 million of losses to interest expense, net related to the 2018 Swaps. We expect to amortize approximately $0.2 million from accumulated other comprehensive loss related to our interest rate swaps during the next twelve months. See Note 9 for additional details. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Commitments Under Contracts for Food and Non-Food Products | Our future purchase obligation payments due by period for both company and franchised restaurants at December 30, 2020 consist of the following: (In thousands) Less than 1 year $ 155,631 1-2 years — 3-4 years — 5 years and thereafter — Total $ 155,631 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of Supplemental Cash Flow Information | Fiscal Year Ended December 30, 2020 December 25, 2019 December 26, 2018 (In thousands) Income taxes paid, net $ 6 $ 24,147 $ 3,254 Interest paid $ 15,889 $ 17,792 $ 19,447 Noncash investing and financing activities: Noncash consideration received in connection $ — $ 3,000 $ — Notes received in connection with disposition of property $ — $ 920 $ — Accrued purchase of property $ 133 $ 1,791 $ 178 Insurance proceeds receivable $ — $ 48 $ 653 Issuance of common stock, pursuant to share-based compensation plans $ 7,949 $ 7,522 $ 4,671 Execution of finance leases $ 142 $ 305 $ 3,623 Treasury stock payable $ — $ 1,816 $ 72 |
Quarterly Data (Unaudited) (Tab
Quarterly Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 30, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Selected Consolidated Financial Data | Selected consolidated financial data for each quarter of fiscal 2020 and 2019 are set forth below: Fiscal Year Ended December 30, 2020 (1) First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) Company restaurant sales $ 42,291 $ 15,128 $ 27,849 $ 32,892 Franchise and licensing revenue 54,404 25,033 43,795 47,213 Total operating revenue 96,695 40,161 71,644 80,105 Total operating costs and expenses 78,649 53,688 68,404 81,185 Operating income (loss) $ 18,046 $ (13,527) $ 3,240 $ (1,080) Net income (loss) $ 9,013 $ (22,965) $ 6,477 $ 2,359 Basic net income (loss) per share (2) $ 0.16 $ (0.41) $ 0.10 $ 0.04 Diluted net income (loss) per share (2) $ 0.16 $ (0.41) $ 0.10 $ 0.04 Fiscal Year Ended December 25, 2019 (3) First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) Company restaurant sale $ 98,545 $ 95,447 $ 63,582 $ 48,803 Franchise and licensing revenue 52,866 56,437 60,676 65,033 Total operating revenue 151,411 151,884 124,258 113,836 Total operating costs and expenses 127,280 105,769 56,084 87,273 Operating income $ 24,131 $ 46,115 $ 68,174 $ 26,563 Net income $ 15,490 $ 34,239 $ 49,122 $ 18,559 Basic net income per share (2) $ 0.25 $ 0.57 $ 0.83 $ 0.32 Diluted net income per share (2) $ 0.24 $ 0.55 $ 0.80 $ 0.31 (1) During 2020, the COVID-19 pandemic had a significant adverse impact on the Company’s business performance, results of operations and cash flows. The fiscal year ended December 30, 2020 includes 53 weeks of operations compared with 52 weeks for all other years presented. (2) Per share amounts do not necessarily sum to the total year amounts due to changes in shares outstanding and rounding. (3) During 2019, the Company migrated from a 90% franchised business model to one that is 96% franchised by selling company owned restaurants to franchisees which resulted in, among other items, a reduction in revenues and the recording of approximately $82.9 million of gains. In addition, the Company also recorded an additional $11.9 million of gains related to the sale of real estate. See Note 13 and Note 14 for details. |
Introduction and Basis of Rep_3
Introduction and Basis of Reporting - (Narrative) (Details) | 12 Months Ended | |||
Dec. 30, 2020restaurantterritorystatecountry | Dec. 25, 2019restaurant | Dec. 26, 2018restaurant | Dec. 27, 2017restaurant | |
Franchisor Disclosure [Line Items] | ||||
Number of states in which entity operates | state | 49 | |||
Number of territories in which entity operates | territory | 2 | |||
Number of foreign countries in which entity operates | country | 11 | |||
Number of restaurants | 1,650 | 1,703 | 1,709 | |
Franchise | ||||
Franchisor Disclosure [Line Items] | ||||
Number of restaurants | 1,585 | 1,635 | 1,536 | 1,557 |
Company-owned restaurants | ||||
Franchisor Disclosure [Line Items] | ||||
Number of restaurants | 65 | 68 | 173 | 178 |
California | ||||
Franchisor Disclosure [Line Items] | ||||
Percentage of restaurants operated by geographic region | 23.00% | |||
Texas | ||||
Franchisor Disclosure [Line Items] | ||||
Percentage of restaurants operated by geographic region | 12.00% | |||
Florida | ||||
Franchisor Disclosure [Line Items] | ||||
Percentage of restaurants operated by geographic region | 8.00% |
Introduction and Basis of Rep_4
Introduction and Basis of Reporting - (Schedule of Change in Restaurants Counts) (Details) - restaurant | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Change in Restaurants Counts [Roll Forward] | |||
Number of restaurants, beginning of period | 1,703 | 1,709 | |
Number of restaurants, end of period | 1,650 | 1,703 | 1,709 |
Company-owned restaurants | |||
Change in Restaurants Counts [Roll Forward] | |||
Number of restaurants, beginning of period | 68 | 173 | 178 |
Units opened | 0 | 0 | 1 |
Units acquired from franchisees | 0 | 0 | 6 |
Units sold to franchisees | 0 | (105) | (8) |
Units closed | (3) | 0 | (4) |
Number of restaurants, end of period | 65 | 68 | 173 |
Franchise | |||
Change in Restaurants Counts [Roll Forward] | |||
Number of restaurants, beginning of period | 1,635 | 1,536 | 1,557 |
Units opened | 20 | 30 | 29 |
Units purchased from Company | 0 | 105 | 8 |
Units acquired by Company | 0 | 0 | (6) |
Units closed | (70) | (36) | (52) |
Number of restaurants, end of period | 1,585 | 1,635 | 1,536 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - (Cash and Cash Equivalents) (Details) - USD ($) $ in Millions | Dec. 30, 2020 | Dec. 25, 2019 |
Accounting Policies [Abstract] | ||
Short-term investments, included as cash and cash equivalents | $ 0.4 | $ 0.4 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - (Property and Depreciation) (Details) | 12 Months Ended |
Dec. 30, 2020 | |
Building Assets | Minimum | |
Property, Plant and Equipment | |
Property and equipment, useful life | 5 years |
Building Assets | Maximum | |
Property, Plant and Equipment | |
Property and equipment, useful life | 30 years |
Equipment | Minimum | |
Property, Plant and Equipment | |
Property and equipment, useful life | 2 years |
Equipment | Maximum | |
Property, Plant and Equipment | |
Property and equipment, useful life | 10 years |
Leasehold Improvements | Minimum | |
Property, Plant and Equipment | |
Property and equipment, useful life | 5 years |
Leasehold Improvements | Maximum | |
Property, Plant and Equipment | |
Property and equipment, useful life | 15 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - (Marketable Securities) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Investment [Line Items] | |||
Marketable securities | $ 2,272 | $ 3,649 | |
Marketable securities, gain (loss) | 1,800 | 2,700 | $ (1,000) |
Investments | |||
Investment [Line Items] | |||
Marketable securities, gain (loss) | (100) | 200 | |
Aggregated Cost | |||
Investment [Line Items] | |||
Marketable securities | 2,200 | 3,500 | |
Estimate of Fair Value Measurement | |||
Investment [Line Items] | |||
Marketable securities | $ 2,300 | $ 3,600 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - (Narrative) (Details) - USD ($) $ in Millions | Dec. 30, 2020 | Dec. 25, 2019 |
Accounting Policies [Abstract] | ||
Discounted insurance liabilities | $ 14 | $ 16.1 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - (Leases and Subleases) (Details) - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 27, 2018 |
Lessee, Lease, Description [Line Items] | |||
Operating lease liabilities | $ 154,390 | ||
Operating lease ROU assets | 139,534 | $ 158,550 | |
Deficit | (194,514) | (189,398) | |
Deferred Tax Assets, Net | $ 23,210 | $ 14,718 | |
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease liabilities | $ 101,300 | ||
Operating lease ROU assets | 94,200 | ||
Accounting Standards Update 2016-02 | Cumulative Effect, Period of Adoption, Adjustment | |||
Lessee, Lease, Description [Line Items] | |||
Deficit | 400 | ||
Deferred Tax Assets, Net | $ 100 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - (Segment) (Details) | 12 Months Ended |
Dec. 30, 2020segment | |
Accounting Policies [Abstract] | |
Number of operating segments | 1 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - (Concentration Risk) (Details) | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Revenue from franchises and licenses risk | |||
Concentration Risk | |||
Franchise revenue, percentage | 39.00% | 35.00% | 30.00% |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - (Advertising Costs) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Franchisor Disclosure [Line Items] | |||
Advertising expense | $ 3.9 | $ 11.2 | $ 15 |
Franchise and license revenue | |||
Franchisor Disclosure [Line Items] | |||
Advertising expense | $ 53.7 | $ 81.1 | $ 78.3 |
Receivables (Details)
Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2020 | Dec. 25, 2019 | |
Receivables, net: | ||
Trade accounts receivable from franchisees | $ 15,535 | $ 14,551 |
Other receivables from franchisees | 2,104 | 2,230 |
Allowance for doubtful accounts | (1,699) | (274) |
Total receivables, net | 21,349 | 27,488 |
Other noncurrent assets: | ||
Financing receivables from franchisees | 502 | 364 |
Expected credit losses | 1,500 | |
Vendor receivables | ||
Receivables, net: | ||
Other receivable, gross, current | 2,199 | 3,260 |
Credit card receivables | ||
Receivables, net: | ||
Other receivable, gross, current | 542 | 6,806 |
Other | ||
Receivables, net: | ||
Other receivable, gross, current | 2,668 | $ 915 |
Trade Accounts Receivable, COVID Deferrals | ||
Receivables, net: | ||
Trade accounts receivable from franchisees | $ 5,700 |
Property (Details)
Property (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Property, Plant and Equipment | |||
Total property | $ 232,737 | $ 245,071 | |
Less accumulated depreciation | 146,583 | 147,445 | |
Property, net | 86,154 | 97,626 | |
Property held under finance leases, leased to franchisees, net | 9,830 | 11,720 | |
Depreciation expense, including amortization of property under capital leases | 13,200 | 16,300 | $ 23,000 |
Franchise | |||
Property, Plant and Equipment | |||
Total property | 94,848 | 105,789 | |
Less accumulated depreciation | 59,038 | 65,476 | |
Property, net | 35,810 | 40,313 | |
Buildings held under finance leases, leased to franchisees | 8,062 | 8,445 | |
Less accumulated amortization | 4,137 | 3,768 | |
Property held under finance leases, leased to franchisees, net | 3,925 | 4,677 | |
Total property leased to franchisees, net | 39,735 | 44,990 | |
Land | |||
Property, Plant and Equipment | |||
Total property | 36,815 | 39,720 | |
Land | Franchise | |||
Property, Plant and Equipment | |||
Total property | 25,192 | 27,205 | |
Buildings and leasehold improvements | |||
Property, Plant and Equipment | |||
Total property | 160,842 | 172,881 | |
Buildings and leasehold improvements | Franchise | |||
Property, Plant and Equipment | |||
Total property | 69,656 | 78,584 | |
Other property and equipment | |||
Property, Plant and Equipment | |||
Total property | $ 35,080 | $ 32,470 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - (Schedule of Changes in Carrying Amount of Goodwill and Schedule of Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Goodwill [Roll Forward] | |||
Balance, beginning of year | $ 36,832 | $ 39,781 | |
Adjustments related to the sale of restaurants | 52 | (2,949) | |
Balance, end of year | 36,884 | 36,832 | $ 39,781 |
Intangible Assets | |||
Gross carrying amount - trade names | 44,087 | 44,087 | |
Gross carrying amount - liquor licenses | 120 | 120 | |
Gross carrying amount - reacquired franchise rights | 12,218 | 15,516 | |
Accumulated amortization - reacquired franchise rights | 4,866 | 5,767 | |
Intangible assets | 56,425 | 59,723 | |
Amortization expense of definite-lived intangible assets and other assets | $ 3,000 | $ 3,600 | $ 4,100 |
Reacquired Franchise Rights | |||
Intangible Assets | |||
Weighted-average life of reacquired franchise rights | 8 years |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - (Estimated Amortization Expense) (Details) $ in Thousands | Dec. 30, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 | $ 1,333 |
2022 | 1,226 |
2023 | 902 |
2024 | 832 |
2025 | $ 776 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - (Narrative) (Details) $ in Millions | 12 Months Ended |
Dec. 30, 2020USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment of franchisee rights (less than) | $ 0.1 |
Other Current Liabilities (Deta
Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 |
Other Liabilities Disclosure [Abstract] | ||
Accrued payroll | $ 17,076 | $ 19,689 |
Accrued insurance, primarily current portion of liability for insurance claims | 4,667 | 6,515 |
Accrued taxes | 4,850 | 5,624 |
Accrued advertising | 4,318 | 6,753 |
Gift cards | 6,127 | 6,469 |
Other | 9,424 | 12,257 |
Other current liabilities | $ 46,462 | $ 57,307 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - (Schedule of Assets and Liabilities on Recurring Basis) (Details) - Recurring - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Deferred compensation plan investments | $ 13,627 | $ 13,517 |
Interest rate swaps, net | (76,445) | (44,670) |
Investments | 2,272 | 3,649 |
Total | (60,546) | (27,504) |
Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Deferred compensation plan investments | 13,627 | 13,517 |
Interest rate swaps, net | 0 | 0 |
Investments | 0 | 0 |
Total | 13,627 | 13,517 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Deferred compensation plan investments | 0 | 0 |
Interest rate swaps, net | (76,445) | (44,670) |
Investments | 2,272 | 3,649 |
Total | (74,173) | (41,021) |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Deferred compensation plan investments | 0 | 0 |
Interest rate swaps, net | 0 | 0 |
Investments | 0 | 0 |
Total | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - (Schedule of Assets and Liabilities Measured on Nonrecurring Basis) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Impairment Charges | $ 4,083 | $ 0 | $ 1,558 | |
Fair Value, Nonrecurring | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Impairment Charges | 4,100 | |||
Fair Value, Nonrecurring | Significant Unobservable Inputs (Level 3) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Assets held and used | $ 2,425 | $ 2,425 | ||
Impairment Charges | $ 1,564 |
Leases - (General) (Details)
Leases - (General) (Details) | Dec. 30, 2020 |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, renewal term | 5 years |
Real Estate | Minimum | |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, term of contract | 10 years |
Real Estate | Maximum | |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, term of contract | 20 years |
Equipment | Minimum | |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, term of contract | 3 years |
Equipment | Maximum | |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, term of contract | 5 years |
Leases - (Lease Costs) (Details
Leases - (Lease Costs) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2020 | Dec. 25, 2019 | |
Finance lease costs: | ||
Amortization of right-of-use assets | $ 1,870 | $ 2,991 |
Interest on lease liabilities | 3,129 | 4,536 |
Sublease income: | ||
Total lease costs | 8,420 | 16,777 |
Occupancy | ||
Operating lease costs: | ||
Operating lease costs | 6,432 | 8,253 |
Variable lease costs: | ||
Variable lease costs | 2,854 | 5,993 |
Costs of franchise and license revenue | ||
Operating lease costs: | ||
Operating lease costs | 18,682 | 17,097 |
Variable lease costs: | ||
Variable lease costs | 6,102 | 7,001 |
General and administrative expenses | ||
Operating lease costs: | ||
Operating lease costs | 100 | 108 |
Variable lease costs: | ||
Variable lease costs | 61 | 41 |
Restructuring charges and exit costs | ||
Operating lease costs: | ||
Operating lease costs | 173 | 0 |
Variable lease costs: | ||
Variable lease costs | 56 | 49 |
Sublease income: | ||
Sublease income | (114) | (306) |
Franchise and license revenue | ||
Sublease income: | ||
Sublease income | $ (30,925) | $ (28,986) |
Leases - (Lease Terms and Disco
Leases - (Lease Terms and Discount Rates) (Details) | Dec. 30, 2020 | Dec. 25, 2019 |
Weighted-average remaining lease term (in years): | ||
Finance leases | 9 years 3 months 18 days | 9 years 8 months 12 days |
Operating leases | 10 years 8 months 12 days | 10 years 9 months 18 days |
Weighted-average discount rate: | ||
Finance leases | 23.80% | 23.50% |
Operating leases | 5.80% | 5.90% |
Leases - (Lease Income) (Detail
Leases - (Lease Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2020 | Dec. 25, 2019 | |
Lease income | ||
Total lease income | $ 41,981 | $ 38,818 |
Restructuring charges and exit costs | ||
Lease income | ||
Operating lease income | 66 | 255 |
Variable lease income | 48 | 49 |
Franchise and license revenue | ||
Lease income | ||
Operating lease income | 33,621 | 28,050 |
Variable lease income | $ 8,246 | $ 10,464 |
Leases - (Cash and Supplemental
Leases - (Cash and Supplemental Noncash) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating cash flows from finance leases | $ 3,129 | $ 4,536 | |
Operating cash flows from operating leases | 23,511 | 26,329 | |
Financing cash flows from finance leases | 1,570 | 2,464 | |
Right-of-use assets obtained in exchange for new finance lease liabilities | 142 | 305 | $ 3,623 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 4,831 | $ 79,534 |
Leases - (Maturities of Lease L
Leases - (Maturities of Lease Labilities Per Topic 842) (Details) - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 |
Lease Liabilities, Finance | ||
2021 | $ 4,737 | |
2022 | 4,343 | |
2023 | 3,778 | |
2024 | 3,171 | |
2025 | 3,163 | |
Thereafter | 19,364 | |
Total undiscounted cash flows | 38,556 | |
Less: interest | 23,187 | |
Present value of lease liabilities | 15,369 | $ 16,453 |
Less: current lease liabilities | 1,839 | 1,674 |
Long-term lease liabilities | 13,530 | 14,779 |
Lease Liabilities, Operating | ||
2021 | 25,184 | |
2022 | 22,381 | |
2023 | 20,146 | |
2024 | 18,621 | |
2025 | 17,453 | |
Thereafter | 106,039 | |
Total undiscounted cash flows | 209,824 | |
Less: interest | 55,434 | |
Present value of lease liabilities | 154,390 | |
Less: current lease liabilities | 16,856 | 16,344 |
Long-term lease liabilities | 137,534 | $ 152,750 |
Lease Receipts, Operating | ||
2021 | 31,732 | |
2022 | 28,792 | |
2023 | 26,210 | |
2024 | 24,704 | |
2025 | 24,248 | |
Thereafter | 177,448 | |
Total undiscounted cash flows | $ 313,134 |
Leases - (Rental Expenses and I
Leases - (Rental Expenses and Income) (Details) $ in Thousands | 12 Months Ended |
Dec. 26, 2018USD ($) | |
Rental expense: | |
Total rental expense | $ 31,083 |
Rental income: | |
Base rents | 22,831 |
Contingent rents | 4,662 |
Total rental income | 27,493 |
Included as a component of occupancy: | |
Rental expense: | |
Base rents | 10,272 |
Contingent rents | 3,074 |
Included as a component of costs of franchise and license revenue: | |
Rental expense: | |
Base rents | 15,108 |
Contingent rents | $ 2,629 |
Long-term Debt - (Schedule of L
Long-term Debt - (Schedule of Long-term Debt) (Details) - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 |
Debt Disclosure [Abstract] | ||
Revolving loans | $ 210,000 | $ 240,000 |
Finance lease obligations | 15,369 | 16,453 |
Total long-term debt | 225,369 | 256,453 |
Less current maturities | 1,839 | 1,674 |
Noncurrent portion of long-term debt | $ 223,530 | $ 254,779 |
Long-Term Debt - (Aggregate Ann
Long-Term Debt - (Aggregate Annual Maturities of Long-Term Debt, Excluding Capital Lease Obligations) (Details) $ in Millions | Dec. 30, 2020USD ($) |
Debt Disclosure [Abstract] | |
Balance outstanding | $ 210 |
Long-Term Debt - (Narrative) (D
Long-Term Debt - (Narrative) (Details) | Dec. 15, 2020USD ($) | May 13, 2020USD ($) | Jun. 24, 2020USD ($) | Dec. 30, 2020USD ($)amendment | Dec. 25, 2019USD ($) | Dec. 26, 2018USD ($) | Jul. 01, 2021USD ($) | Mar. 31, 2021USD ($) | Dec. 27, 2017USD ($) |
Line of Credit Facility [Line Items] | |||||||||
Debt instrument, term | 5 years | ||||||||
Maximum borrowing capacity | $ 400,000,000 | ||||||||
Nonoperating income (expense) | $ 200,000 | ||||||||
Unrealized remained in accumulated other comprehensive loss, net | 130,446,000 | $ 138,064,000 | $ 133,345,000 | $ 97,360,000 | |||||
Derivatives | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Reclassification | $ 7,400,000 | 7,354,000 | |||||||
Derivatives | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Reclassification | 783,000 | ||||||||
Derivatives | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Reclassification | 3,160,000 | 291,000 | 307,000 | ||||||
Unrealized remained in accumulated other comprehensive loss, net | 59,427,000 | $ 33,179,000 | $ 3,319,000 | $ 1,334,000 | |||||
2015 Hedges | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Interest rate swaps, net | 15,900,000 | ||||||||
Expect reclassification within next twelve months | 3,900,000 | ||||||||
2018 Hedges | Other Nonoperating Income (Expense) | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Unrealized gain (loss) on derivatives | 10,300,000 | ||||||||
2018 Hedges | Derivatives | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Interest rate swaps, net | 60,500,000 | ||||||||
Expect reclassification within next twelve months | 200,000 | ||||||||
Reclassification | $ 7,400,000 | ||||||||
2018 Hedges | Derivatives | Other Current Liabilities | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Interest rate swaps, net | 300,000 | ||||||||
2018 Hedges | Derivatives | Other Noncurrent Liabilities | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Interest rate swaps, net | 60,200,000 | ||||||||
2018 Hedges | Derivatives | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Reclassification | 800,000 | ||||||||
2018 Hedges | Derivatives | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Unrealized remained in accumulated other comprehensive loss, net | 64,400,000 | ||||||||
Senior secured revolver | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Maximum borrowing capacity | 375,000,000 | 375,000,000 | |||||||
Outstanding amount under credit facility | 210,000,000 | ||||||||
Availability under the revolving facility | 147,700,000 | ||||||||
Liquidity covenant availability | $ 81,600,000 | ||||||||
Number of amendment | amendment | 2 | ||||||||
Commitment fee, percent | 0.40% | ||||||||
Capital expenditures restrictions | $ 10,000,000 | $ 10,000,000 | |||||||
Weighted-average interest rate | 3.15% | 3.47% | |||||||
Senior secured revolver | Interest rate swaps, net | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Weighted-average interest rate | 5.01% | 3.99% | |||||||
Senior secured revolver | Forecast | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Maximum borrowing capacity | $ 350,000,000 | ||||||||
Capital expenditures restrictions expanded amount | $ 12,000,000 | ||||||||
Senior secured revolver | LIBOR | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Basis spread on variable rate debt | 3.00% | 3.00% | |||||||
Letter of credit | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Maximum borrowing capacity | $ 30,000,000 | ||||||||
Outstanding amount under letter of credit | $ 17,300,000 | ||||||||
Letter of credit | Senior secured revolver | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Liquidity requirement | $ 70,000,000 | ||||||||
Letter of credit | Senior secured revolver | Minimum | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Liquidity requirement | $ 60,000,000 | ||||||||
Letter of credit | Senior secured revolver | Maximum | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Liquidity requirement | $ 70,000,000 | ||||||||
Letter of credit | Senior secured revolver | Before Amendment | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Covenant, leverage ratio | 4 | ||||||||
Letter of credit | Senior secured revolver | Until Quarter Ending March 31, 2021 | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Fixed charge coverage ratio, minimum | 1 | 1.50 | |||||||
Covenant, leverage ratio | 5.25 | 4.50 | |||||||
Letter of credit | Senior secured revolver | Second Quarter of 2021 | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Covenant, leverage ratio | 4.75 | 4.25 | |||||||
Fixed charge coverage ratio, adjusted value | 1.25 | ||||||||
Letter of credit | Senior secured revolver | Third Quarter 2021 and Thereafter | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Covenant, leverage ratio | 4 | 4 | |||||||
Fixed charge coverage ratio, adjusted value | 1.50 |
Long-Term Debt - (Schedule of I
Long-Term Debt - (Schedule of Interest Rate Swaps) (Details) | Dec. 30, 2020USD ($) |
Derivative [Line Items] | |
Notional Amount | $ 270,000,000 |
Fair Value | 76,445,000 |
Interest Rate Swaps Maturity 2025 | |
Derivative [Line Items] | |
Notional Amount | 120,000,000 |
Fair Value | $ 10,698,000 |
Fixed Rate | 2.44% |
Interest Rate Swaps Maturity 2026 | |
Derivative [Line Items] | |
Notional Amount | $ 50,000,000 |
Fair Value | $ 5,232,000 |
Fixed Rate | 2.46% |
Interest Rate Swaps Maturity 2033 | |
Derivative [Line Items] | |
Notional Amount | $ 100,000,000 |
Fair Value | $ 60,515,000 |
Fixed Rate | 3.19% |
Maximum | |
Derivative [Line Items] | |
Notional Amount | $ 425,000,000 |
Revenues - (Narrative) (Details
Revenues - (Narrative) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 30, 2020USD ($) | Sep. 23, 2020USD ($) | Jun. 24, 2020USD ($) | Mar. 25, 2020USD ($) | Dec. 25, 2019USD ($) | Sep. 25, 2019USD ($) | Jun. 26, 2019USD ($) | Mar. 27, 2019USD ($) | Dec. 30, 2020USD ($)segmentsale_channel | Dec. 25, 2019USD ($) | Dec. 26, 2018USD ($) | |
Disaggregation of Revenue [Line Items] | |||||||||||
Number of sales channels | sale_channel | 2 | ||||||||||
Number of operating segments | segment | 1 | ||||||||||
Total operating revenue | $ 80,105 | $ 71,644 | $ 40,161 | $ 96,695 | $ 113,836 | $ 124,258 | $ 151,884 | $ 151,411 | $ 288,605 | $ 541,389 | $ 630,179 |
Contract with customer | 1,997 | 1,997 | |||||||||
Revenue recognized included in beginning deferred franchise revenue balance | 3,200 | ||||||||||
Company restaurant sales | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | 32,892 | $ 27,849 | $ 15,128 | $ 42,291 | 48,803 | $ 63,582 | $ 95,447 | $ 98,545 | 118,160 | 306,377 | 411,932 |
Franchise and License Revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | 170,400 | 235,000 | $ 218,200 | ||||||||
Gift Card Redemption | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Contract with customer | $ 6,100 | $ 6,500 | 6,100 | $ 6,500 | |||||||
Revenue recognized included in beginning deferred franchise revenue balance | $ 400 |
Revenues - (Disaggregation of R
Revenues - (Disaggregation of Revenues) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 30, 2020 | Sep. 23, 2020 | Jun. 24, 2020 | Mar. 25, 2020 | Dec. 25, 2019 | Sep. 25, 2019 | Jun. 26, 2019 | Mar. 27, 2019 | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | $ 80,105 | $ 71,644 | $ 40,161 | $ 96,695 | $ 113,836 | $ 124,258 | $ 151,884 | $ 151,411 | $ 288,605 | $ 541,389 | $ 630,179 |
Company restaurant sales | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | 32,892 | 27,849 | 15,128 | 42,291 | 48,803 | 63,582 | 95,447 | 98,545 | 118,160 | 306,377 | 411,932 |
Royalties | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | 67,501 | 108,813 | 101,557 | ||||||||
Advertising revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | 53,745 | 81,144 | 78,308 | ||||||||
Initial and other fees | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | 7,332 | 6,541 | 6,422 | ||||||||
Occupancy revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | 41,867 | 38,514 | 31,960 | ||||||||
Franchise and license revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | $ 47,213 | $ 43,795 | $ 25,033 | $ 54,404 | $ 65,033 | $ 60,676 | $ 56,437 | $ 52,866 | $ 170,445 | $ 235,012 | $ 218,247 |
Revenues - (Contract Balance) (
Revenues - (Contract Balance) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2020 | Dec. 25, 2019 | |
Contract With Customer Liability [Roll Forward] | ||
Balance, December 25, 2019 | $ 23,256 | |
Fees received from franchisees | 868 | |
Revenue recognized | (3,318) | |
Balance, December 30, 2020 | 20,806 | $ 23,256 |
Less current portion included in other current liabilities | 1,997 | |
Deferred franchise revenue included in other noncurrent liabilities | $ 18,809 | |
Revenue recognized included in beginning deferred franchise revenue balance | $ 3,200 |
Revenues - (Deferred Revenue) (
Revenues - (Deferred Revenue) (Details) $ in Thousands | Dec. 30, 2020USD ($) |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred franchise revenue expected to be recognized | $ 20,806 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-12-31 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred franchise revenue expected to be recognized | $ 1,997 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-12-30 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred franchise revenue expected to be recognized | $ 1,893 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-12-29 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred franchise revenue expected to be recognized | $ 1,812 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-12-28 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred franchise revenue expected to be recognized | $ 1,760 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-12-26 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred franchise revenue expected to be recognized | $ 1,690 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred franchise revenue expected to be recognized | $ 11,654 |
Revenue, remaining performance obligation, expected timing of satisfaction, period |
Revenues - (Impact of Adoption)
Revenues - (Impact of Adoption) (Details) - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | Dec. 27, 2017 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Deferred franchise revenue included in other noncurrent liabilities | $ 18,809 | |||
Shareholders’ deficit | (130,446) | $ (138,064) | $ (133,345) | $ (97,360) |
Deferred income taxes, net | 23,210 | 14,718 | ||
Other current liabilities | $ (46,462) | $ (57,307) | ||
Accounting Standards Update 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Accrued advertising | 500 | |||
Accounting Standards Update 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | Franchise and license revenue | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Deferred franchise revenue included in other noncurrent liabilities | 21,000 | |||
Shareholders’ deficit | 15,600 | 100 | ||
Deferred income taxes, net | $ 5,400 | |||
Accounting Standards Update 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | Gift Card Redemption | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Other current liabilities | $ 600 |
Employee Benefit Plans - (Defin
Employee Benefit Plans - (Defined Contribution Plans) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Employer contributions | $ 1.5 | $ 1.9 | $ 2.2 |
Qualified Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Maximum annual contribution per employee | 25.00% | ||
Employer matching contribution | 4.00% | ||
Nonqualified Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Maximum annual contribution per employee | 50.00% | ||
Maximum incentive compensation deferral | 75.00% |
Employee Benefit Plans - (Chang
Employee Benefit Plans - (Change in Benefit Obligation and Plan Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Change in Benefit Obligation: | |||
Benefit obligation at beginning of year | $ 2,337 | $ 2,393 | |
Interest cost | 41 | 81 | $ 76 |
Actuarial losses | 448 | 25 | |
Benefits paid | (151) | (162) | |
Settlements | (377) | 0 | |
Benefit obligation at end of year | 2,298 | 2,337 | 2,393 |
Accumulated benefit obligation | 2,298 | 2,337 | |
Change in Plan Assets: | |||
Fair value of plan assets at beginning of year | 0 | 0 | |
Employer contributions | 528 | 162 | |
Benefits paid | (151) | (162) | |
Settlements | (377) | 0 | |
Fair value of plan assets at end of year | 0 | 0 | $ 0 |
Unfunded status at end of year | (2,298) | (2,337) | |
Amounts recognized on the balance sheet: | |||
Other current liabilities | (717) | (662) | |
Other noncurrent liabilities | (1,581) | (1,675) | |
Net amount recognized | (2,298) | (2,337) | |
Amounts in accumulated other comprehensive loss not yet reflected in net period benefit cost: | |||
Unamortized actuarial losses, net | (1,087) | (823) | |
Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive loss: | |||
Benefit obligation actuarial loss | (448) | (25) | |
Amortization of net loss | 89 | 86 | |
Settlement loss recognized | 95 | 0 | |
Other comprehensive income (loss) | $ (264) | $ 61 |
Employee Benefit Plans - (Compo
Employee Benefit Plans - (Components of Net Periodic Benefit Cost) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Components of net periodic benefit cost [Abstract] | |||
Interest cost | $ 41 | $ 81 | $ 76 |
Amortization of net loss | 89 | 86 | 112 |
Settlement loss recognized | 95 | 0 | 0 |
Net periodic benefit cost | $ 225 | $ 167 | $ 188 |
Employee Benefit Plans - (Assum
Employee Benefit Plans - (Assumptions) (Details) | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Retirement Benefits [Abstract] | |||
Discount rate used to determine the benefit obligations | 1.34% | 2.56% | |
Discount rate used to determine net period pension costs | 2.56% | 3.83% | 3.08% |
Employee Benefit Plans - (Benef
Employee Benefit Plans - (Benefits Expected to be Paid in Future Years) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2020 | Dec. 25, 2019 | |
Retirement Benefits [Abstract] | ||
Employer contributions | $ 528 | $ 162 |
Estimated employer contributions during 2020 | 700 | |
Benefits expected to be paid: | ||
2021 | 716 | |
2022 | 406 | |
2023 | 550 | |
2024 | 122 | |
2025 | 100 | |
2026 through 2030 | $ 413 |
Share-Based Compensation - (Nar
Share-Based Compensation - (Narrative) (Details) $ / shares in Units, shares in Thousands, $ in Millions | Sep. 30, 2020 | Dec. 30, 2020USD ($)planinstallment$ / sharesshares | Dec. 25, 2019USD ($)$ / sharesshares | Dec. 26, 2018USD ($)$ / shares | Sep. 23, 2020USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of share-based compensation plans | plan | 4 | ||||
Shares available for grant (in shares) | shares | 700 | ||||
Income tax benefits recognized related to share-based compensation | $ | $ 2 | $ 1.7 | $ 1.6 | ||
Restricted stock units for board members | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity awards granted (in shares) | shares | 100 | ||||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 10.43 | ||||
Vesting period | 1 year | ||||
Number of equal annual installments | installment | 3 | ||||
Unrecognized compensation cost related to unvested awards outstanding | $ | $ 0.3 | ||||
Unrecognized compensation cost, expected weighted average period | 4 months 24 days | ||||
Stock units converted into common stock (in shares) | shares | 100 | ||||
Stock units outstanding (in shares) | shares | 800 | 700 | |||
Employee share awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 10.47 | $ 19.02 | $ 16.97 | ||
Cash payments | $ | $ 0.2 | $ 0.4 | $ 0.2 | ||
Intrinsic value of units converted | $ | 12 | 16.9 | $ 9.8 | ||
Accrued compensation included as a component of other current liabilities | $ | 0.1 | 0.1 | |||
Accrued compensation included as a component of other noncurrent liabilities | $ | 0.2 | $ 0.2 | |||
Unrecognized compensation cost related to unvested awards outstanding | $ | $ 8.8 | ||||
Unrecognized compensation cost, expected weighted average period | 1 year 3 months 18 days | ||||
Stock units outstanding (in shares) | shares | 1,563 | 1,681 | |||
2020 Employee Share Awards | Restricted stock units for board members | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity awards granted (in shares) | shares | 800 | ||||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 10.47 | ||||
Vesting period | 2 years | ||||
2017 Omnibus Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares available for grant (in shares) | shares | 2,000 | ||||
2018 | Employee share awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
Percentage of awards issued | 100.00% | ||||
Percentage of growth in earnings | 50.00% | ||||
Percentage of relative total stockholder return | 50.00% | ||||
Award initial measurement period | 2 years | ||||
Number of shares affected (in shares) | shares | 200 | ||||
Fair value of shares affected | $ | $ 2.4 | $ 0 | |||
Fair value of shares affected (in dollars per share) | $ / shares | $ 10 | ||||
Percentage of target | 100.00% | ||||
Total percentage of target | 150.00% | ||||
2019 | Employee share awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 8.24 | ||||
Vesting period | 3 years | ||||
Percentage of awards issued | 100.00% | ||||
Percentage of growth in earnings | 50.00% | ||||
Percentage of relative total stockholder return | 50.00% | ||||
Number of shares affected (in shares) | shares | 300 | ||||
Fair value of shares affected | $ | $ 2.3 | $ 0 | |||
Remaining term | 15 months |
Share-Based Compensation - (Com
Share-Based Compensation - (Component of Net Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation | $ 7,948 | $ 6,694 | $ 6,038 |
Employee share awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation | 7,104 | 5,765 | 5,039 |
Restricted stock units for board members | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation | $ 844 | $ 929 | $ 999 |
Share-Based Compensation - (Per
Share-Based Compensation - (Performance Share Units) (Details) - Employee share awards - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Units | |||
Outstanding, beginning of year (in shares) | 1,681 | ||
Granted (in shares) | 824 | ||
Vested (in shares) | (829) | ||
Forfeited (in shares) | (113) | ||
Cancellations due to modification (in shares) | (522) | ||
Reissuance due to modification (in shares) | 522 | ||
Outstanding, end of year (in shares) | 1,563 | 1,681 | |
Weighted Average Grant Date Fair Value | |||
Outstanding, beginning of year (in dollars per share) | $ 16.22 | ||
Granted (in dollars per share) | 10.47 | $ 19.02 | $ 16.97 |
Vested (in dollars per share) | 11.84 | ||
Forfeited (in dollars per share) | 16.25 | ||
Cancellations due to modification (in dollars per share) | 16.83 | ||
Reissuance due to modification (in dollars per share) | 9.04 | ||
Outstanding, end of year (in dollars per share) | $ 12.91 | $ 16.22 | |
Convertible, end of year (in shares) | 577 | ||
Convertible, end of year, weighted-average grant date fair value (in dollars per share) | $ 14.92 |
Share-Based Compensation - (Sto
Share-Based Compensation - (Stock Options) (Details) - Options - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Contractual life | 10-year | ||
Options granted | 0 | 0 | 0 |
Intrinsic value of the options exercised | $ 800 | $ 6,600 | $ 4,900 |
Options | |||
Outstanding, beginning of year (in shares) | 140,000 | ||
Exercised (in shares) | (110,000) | ||
Outstanding, end of year (in shares) | 30,000 | 140,000 | |
Exercisable, end of year (in shares) | 30,000 | ||
Weighted Average Exercise Price | |||
Outstanding, beginning of year (in dollars per share) | $ 3.89 | ||
Exercised (in dollars per share) | 3.89 | ||
Outstanding, end of year (in dollars per share) | 3.89 | $ 3.89 | |
Exercisable, end of year (in dollars per share) | $ 3.89 | ||
Weighted-Average Remaining Contractual Life and Aggregate Intrinsic Value | |||
Outstanding, end of year, weighted average remaining contractual life | 1 month 6 days | ||
Exercisable, end of year, weighted average remaining contractual life | 1 month 6 days | ||
Outstanding, end of year, aggregate intrinsic value | $ 305 | ||
Exercisable, end of year, aggregate intrinsic value | $ 305 |
Refranchisings and Acquisitio_3
Refranchisings and Acquisitions - (Refranchising and Development Strategy) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020USD ($)restaurantparcel | Dec. 25, 2019USD ($)parcelrestaurant | Dec. 26, 2018USD ($)restaurantparcel | |
Gains (losses) on sales of company restaurants: | |||
Noncash consideration | $ 0 | $ 3,000 | $ 0 |
Gains on sales of assets and other, net | 4,678 | 93,608 | 513 |
Real Estate | |||
Gains (losses) on sales of company restaurants: | |||
Cash proceeds | 9,419 | 10,680 | 0 |
Less: Property sold | $ (3,648) | $ (1,686) | $ 0 |
Real estate parcels sold | parcel | 10 | 6 | 0 |
Noncash consideration | $ 0 | $ 3,000 | $ 0 |
Less: Other assets | (835) | (120) | 0 |
Gains on sales of assets and other, net | $ 4,936 | $ 11,874 | $ 0 |
Company restaurant sales | |||
Franchisor Disclosure [Line Items] | |||
Restaurants sold to franchisees | restaurant | 0 | 105 | 8 |
Gains (losses) on sales of company restaurants: | |||
Cash proceeds | $ 0 | $ 118,964 | $ 1,777 |
Receivables | 0 | 920 | 0 |
Less: Property sold | 0 | (30,511) | (2,448) |
Less: Goodwill | 0 | (2,897) | (62) |
Less: Intangibles | 0 | (2,260) | (13) |
Less: Deferred gain | 0 | (1,350) | 0 |
Gains on sales of assets and other, net | $ 0 | $ 82,866 | $ (746) |
Refranchisings and Acquisitio_4
Refranchisings and Acquisitions - (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020USD ($)restaurantreal_estate | Dec. 25, 2019USD ($)real_estaterestaurant | Dec. 26, 2018USD ($)restaurant | |
Franchisor Disclosure [Line Items] | |||
Noncash consideration | $ 0 | $ 3,000 | $ 0 |
Assets held for sale | $ 1,125 | $ 1,925 | |
Number of restaurants | restaurant | 1,650 | 1,703 | 1,709 |
Held-for-sale | |||
Franchisor Disclosure [Line Items] | |||
Assets held for sale | $ 1,100 | $ 1,900 | |
Assets held for sale, property | 1,000 | 1,600 | |
Other assets held for sale | $ 100 | $ 200 | |
Number of real estate properties | real_estate | 2 | 2 | |
Number of restaurants | restaurant | 4 | ||
Assets held for sale, goodwill | $ 100 | ||
Real Estate | |||
Franchisor Disclosure [Line Items] | |||
Noncash consideration | $ 0 | 3,000 | $ 0 |
Real Estate | Other Noncurrent Assets | |||
Franchisor Disclosure [Line Items] | |||
Noncash consideration | $ 3,000 | $ 3,000 |
Refranchisings and Acquisitio_5
Refranchisings and Acquisitions - (Acquisition Activity) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020USD ($)restaurantparcel | Dec. 25, 2019USD ($)restaurantparcel | Dec. 26, 2018USD ($)restaurantparcel | |
Business Acquisition [Line Items] | |||
Restaurants acquired from franchisees | restaurant | 0 | 0 | 6 |
Purchase price allocation: | |||
Reacquired franchise rights | $ 0 | $ 0 | $ 5,434 |
Property | 0 | 0 | 1,121 |
Goodwill | 0 | 0 | 1,574 |
Total purchase price | 0 | 0 | 8,129 |
Finance leases recorded | 0 | 0 | 2,409 |
Real Estate | |||
Purchase price allocation: | |||
Total purchase price | $ 0 | $ 11,320 | $ 1,787 |
Real estate parcels acquired | parcel | 0 | 5 | 1 |
Operating (Gains), Losses and_3
Operating (Gains), Losses and Other Charges, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Other Income and Expenses [Abstract] | |||
Gains on sales of assets and other, net | $ (4,678) | $ (93,608) | $ (513) |
Restructuring charges and exit costs | 2,403 | 2,428 | 1,575 |
Impairment charges | 4,083 | 0 | 1,558 |
Operating (gains), losses and other charges, net | 1,808 | (91,180) | 2,620 |
Gain on insurance settlements | 1,200 | ||
Loss on sale of restaurants | 700 | ||
Restructuring charges and exit costs [Abstract] | |||
Exit costs | 204 | 272 | 518 |
Severance and other restructuring charges | 2,199 | 2,156 | 1,057 |
Total restructuring charges and exit costs | 2,403 | 2,428 | 1,575 |
Restructuring reserve | 100 | 200 | |
Accrued severance and other restructuring charges | 600 | 900 | |
Impairment Charges | 4,083 | $ 0 | $ 1,558 |
Tangible asset impairment charges | 2,400 | ||
Operating lease, impairment loss | 1,600 | ||
Impairment of franchisee rights (less than) | 100 | ||
Impairment related to finance lease ROU assets | $ 100 |
Income Taxes - (Provisions) (De
Income Taxes - (Provisions) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Current: | |||
Federal | $ (3,497) | $ 12,421 | $ (632) |
State and local | (109) | 5,156 | 1,833 |
Foreign | 667 | 1,142 | 1,042 |
Deferred: | |||
Federal | 393 | 9,944 | 5,432 |
State and local | 3,588 | 6,061 | 761 |
(Decrease) increase of valuation allowance | (3,041) | (2,935) | 121 |
Total provision for (benefit from) income taxes | $ (1,999) | $ 31,789 | $ 8,557 |
Income Taxes - (Reconciliation
Income Taxes - (Reconciliation of Income Taxes) (Details) | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Reconciliation of income taxes at the U.S. federal statutory tax rate to effective tax rate: | |||
Statutory provision rate | 21.00% | 21.00% | 21.00% |
State, foreign and local taxes, net of federal income tax benefit | (11.00%) | 8.00% | 6.00% |
Change in state valuation allowance | (1.00%) | (2.00%) | 0.00% |
General business credits generated | 9.00% | (2.00%) | (5.00%) |
Foreign tax credits generated | 2.00% | (1.00%) | (2.00%) |
Carryback of net operating loss rate differential | 12.00% | 0.00% | 0.00% |
Section 162(m) and share-based compensation | (11.00%) | (3.00%) | (3.00%) |
Insurance premiums | 5.00% | 0.00% | 0.00% |
Other | 2.00% | 0.00% | (1.00%) |
Effective tax rate | 28.00% | 21.00% | 16.00% |
Income Taxes - (Narrative) (Det
Income Taxes - (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Valuation Allowance [Line Items] | |||
Net operating loss carryback | $ 900,000 | ||
Tax expense (benefit) recognized related to share-based compensation | 1,000,000 | $ (2,000,000) | $ (1,400,000) |
Liability for income tax examination | 2,000,000 | ||
Income tax refunds | 2,100,000 | ||
Net operating loss carryforwards - state | 5,888,000 | 9,621,000 | |
Increase (decrease) of tax valuation allowance | (3,041,000) | (2,935,000) | $ 121,000 |
Valuation allowance | 7,223,000 | 10,264,000 | |
Interest and penalties recognized on unrecognized tax benefits | 0 | $ 0 | |
South Carolina NOL Carryforwards | |||
Valuation Allowance [Line Items] | |||
Net operating loss carryforwards - state | 4,600,000 | ||
Valuation allowance | 4,400,000 | ||
State Enterprise Zone Credits | |||
Valuation Allowance [Line Items] | |||
Valuation allowance | 1,500,000 | ||
Foreign Tax Credit Carryforward | |||
Valuation Allowance [Line Items] | |||
Valuation allowance | $ 300,000 |
Income Taxes - (Deferred Tax As
Income Taxes - (Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 30, 2020 | Dec. 25, 2019 |
Deferred tax assets: | ||
Self-insurance accruals | $ 3,315 | $ 4,202 |
Finance lease liabilities | 1,369 | 1,263 |
Operating lease liabilities | 39,555 | 43,497 |
Accrued exit cost | 25 | 48 |
Interest rate swaps | 19,806 | 11,491 |
Pension, other retirement and compensation plans | 10,638 | 10,549 |
Deferred income | 5,337 | 4,688 |
General business and foreign tax credit carryforwards - state and federal | 2,782 | 2,945 |
Net operating loss carryforwards - state | 5,888 | 9,621 |
Charitable contribution carryforwards - federal and state | 161 | 0 |
Total deferred tax assets before valuation allowance | 88,876 | 88,304 |
Less: valuation allowance | (7,223) | (10,264) |
Total deferred tax assets | 81,653 | 78,040 |
Deferred tax liabilities: | ||
Intangible assets | (14,579) | (14,858) |
Deferred finance costs | (86) | (211) |
Operating lease right-of-use assets | (35,732) | (40,751) |
Fixed assets | (7,679) | (6,711) |
Other accruals | (367) | (791) |
Total deferred tax liabilities | (58,443) | (63,322) |
Net deferred tax asset | $ 23,210 | $ 14,718 |
Income Taxes - (Unrecognized Ta
Income Taxes - (Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 30, 2020 | Dec. 25, 2019 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance, beginning of year | $ 1,047 | $ 2,940 |
Decrease related to prior-year tax positions | 0 | (1,893) |
Balance, end of year | $ 1,047 | $ 1,047 |
Other CARES Act Provisions (Det
Other CARES Act Provisions (Details) $ in Millions | 12 Months Ended |
Dec. 30, 2020USD ($) | |
Unusual or Infrequent Item, or Both [Line Items] | |
Employee retention tax credit, | $ 2.6 |
Social security taxes | 3.1 |
Costs of company restaurant sales | |
Unusual or Infrequent Item, or Both [Line Items] | |
Employee retention tax credit, | 0.9 |
General and administrative expenses | |
Unusual or Infrequent Item, or Both [Line Items] | |
Employee retention tax credit, | $ 1.7 |
Net Income (Loss) Per Share (De
Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 30, 2020 | Sep. 23, 2020 | Jun. 24, 2020 | Mar. 25, 2020 | Dec. 25, 2019 | Sep. 25, 2019 | Jun. 26, 2019 | Mar. 27, 2019 | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Earnings Per Share [Abstract] | |||||||||||
Net income (loss) | $ 2,359 | $ 6,477 | $ (22,965) | $ 9,013 | $ 18,559 | $ 49,122 | $ 34,239 | $ 15,490 | $ (5,116) | $ 117,410 | $ 43,693 |
Weighted average shares outstanding - basic | 60,812 | 59,944 | 63,364 | ||||||||
Effect of dilutive share-based compensation awards | 0 | 1,889 | 2,198 | ||||||||
Weighted average shares outstanding - diluted | 60,812 | 61,833 | 65,562 | ||||||||
Basic net income (loss) per share (in dollars per share) | $ 0.04 | $ 0.10 | $ (0.41) | $ 0.16 | $ 0.32 | $ 0.83 | $ 0.57 | $ 0.25 | $ (0.08) | $ 1.96 | $ 0.69 |
Diluted net income (loss) per share (in dollars per share) | $ 0.04 | $ 0.10 | $ (0.41) | $ 0.16 | $ 0.31 | $ 0.80 | $ 0.55 | $ 0.24 | $ (0.08) | $ 1.90 | $ 0.67 |
Anti-dilutive share-based compensation awards (in shares) | 1,682 | 270 | 0 |
Shareholders' Equity - (Share R
Shareholders' Equity - (Share Repurchases) (Details) - USD ($) $ / shares in Units, shares in Thousands | 1 Months Ended | 12 Months Ended | ||||
Nov. 30, 2018 | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | Dec. 27, 2017 | Dec. 28, 2016 | |
Equity, Class of Treasury Stock [Line Items] | ||||||
Purchase of treasury stock (in shares) | 1,700 | |||||
Payments for treasury stock | $ 34,193,000 | $ 96,202,000 | $ 61,189,000 | |||
Stock repurchased during period (in shares) | 5,300 | 3,900 | ||||
Stock repurchased during period | $ 103,000,000 | |||||
Payments for treasury stock | $ 36,008,000 | $ 94,459,000 | $ 61,237,000 | |||
Treasury Stock | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Purchase of treasury stock (in shares) | 1,690 | 4,879 | 3,901 | |||
Payments for treasury stock | $ 34,193,000 | $ 96,202,000 | $ 61,189,000 | |||
Share Repurchase Program 2019 | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase, authorized amount | $ 250,000,000 | |||||
Remaining shares to be repurchased amount | $ 248,000,000 | |||||
Share Repurchase Program 2017 | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase, authorized amount | $ 200,000,000 | |||||
Share Repurchase Program 2016 | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase, authorized amount | $ 100,000,000 | |||||
Accelerated Share Repurchase 2018 | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase, authorized amount | $ 25,000,000 | |||||
Purchase of treasury stock (in shares) | 1,100 | 400 | ||||
Payments for treasury stock | $ 6,800,000 | |||||
Payments for treasury stock | $ 25,000,000 | |||||
Volume-weighted average price (in dollars per share) | $ 17.04 | |||||
Accelerated Share Repurchase 2018 | Treasury Stock | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Payments for treasury stock | $ 18,200,000 | |||||
Accelerated Share Repurchase 2018 | Additional Paid-in Capital | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Remaining shares to be repurchased amount | $ 6,800,000 |
Shareholders' Equity - (Retirem
Shareholders' Equity - (Retirement of Treasury Stock and Issuance and Sale of Common Stock) (Details) - USD ($) $ / shares in Units, $ in Millions | Jul. 06, 2020 | Jul. 01, 2020 | Dec. 30, 2020 | Dec. 25, 2019 |
Equity [Abstract] | ||||
Retirement of shares (in shares) | 54,000,000 | |||
Weighted average share price (in dollars per share) | $ 10.26 | |||
Number of shares sold (in shares) | 8,000,000 | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |
Price per share (in dollars per share) | $ 9.15 | |||
Proceeds from sale of stock | $ 69.6 |
Shareholders' Equity - (Compone
Shareholders' Equity - (Components of Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jun. 24, 2020 | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
AOCI Attributable To Parent, Net Of Tax [Roll Forward] | ||||
Balance as of beginning period | $ (138,064) | $ (133,345) | $ (97,360) | |
Settlement loss recognized | 95 | 0 | ||
Income tax benefit | 9,432 | 10,320 | 250 | |
Balance as of end of period | (130,446) | (138,064) | (133,345) | |
Pensions | ||||
AOCI Attributable To Parent, Net Of Tax [Roll Forward] | ||||
Balance as of beginning period | (781) | (827) | (982) | |
Benefit obligation actuarial gain (loss) | (448) | (25) | 96 | |
Settlement loss recognized | 95 | |||
Income tax benefit | 67 | (15) | (53) | |
Balance as of end of period | (978) | (781) | (827) | |
Derivatives | ||||
AOCI Attributable To Parent, Net Of Tax [Roll Forward] | ||||
Balance as of beginning period | (33,179) | (3,319) | (1,334) | |
Reclassification | 3,160 | 291 | 307 | |
Changes in the fair value of cash flow derivatives | (46,910) | (40,486) | (2,595) | |
Income tax benefit | 9,365 | 10,335 | 303 | |
Balance as of end of period | (59,427) | (33,179) | (3,319) | |
Estimated reclassification from other comprehensive loss to interest expense related to the interest rate swaps over the next 12 months | 3,900 | |||
Derivatives | ||||
AOCI Attributable To Parent, Net Of Tax [Roll Forward] | ||||
Reclassification | $ 7,400 | 7,354 | ||
Derivatives | ||||
AOCI Attributable To Parent, Net Of Tax [Roll Forward] | ||||
Reclassification | 783 | |||
Estimated reclassification from other comprehensive loss to interest expense related to the interest rate swaps over the next 12 months | 200 | |||
Amortization of net loss | ||||
AOCI Attributable To Parent, Net Of Tax [Roll Forward] | ||||
Reclassification | 89 | 86 | 112 | |
Accumulated Other Comprehensive Loss | ||||
AOCI Attributable To Parent, Net Of Tax [Roll Forward] | ||||
Balance as of beginning period | (33,960) | (4,146) | (2,316) | |
Balance as of end of period | $ (60,405) | $ (33,960) | $ (4,146) |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Dec. 30, 2020USD ($) |
Payments due by period: | |
Less than 1 year | $ 155,631 |
1-2 years | 0 |
3-4 years | 0 |
5 years and thereafter | 0 |
Total | $ 155,631 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Supplemental Cash Flow Information [Abstract] | |||
Income taxes paid, net | $ 6 | $ 24,147 | $ 3,254 |
Interest paid | 15,889 | 17,792 | 19,447 |
Noncash investing and financing activities: | |||
Noncash consideration received in connection with the sale of real estate | 0 | 3,000 | 0 |
Notes received in connection with disposition of property | 0 | 920 | 0 |
Accrued purchase of property | 133 | 1,791 | 178 |
Insurance proceeds receivable | 0 | 48 | 653 |
Issuance of common stock, pursuant to share-based compensation plans | 7,949 | 7,522 | 4,671 |
Execution of finance leases | 142 | 305 | 3,623 |
Treasury stock payable | $ 0 | $ 1,816 | $ 72 |
Quarterly Data (Unaudited) (Det
Quarterly Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 30, 2020 | Sep. 23, 2020 | Jun. 24, 2020 | Mar. 25, 2020 | Dec. 25, 2019 | Sep. 25, 2019 | Jun. 26, 2019 | Mar. 27, 2019 | Dec. 30, 2020 | Dec. 25, 2019 | Dec. 26, 2018 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | $ 80,105 | $ 71,644 | $ 40,161 | $ 96,695 | $ 113,836 | $ 124,258 | $ 151,884 | $ 151,411 | $ 288,605 | $ 541,389 | $ 630,179 |
Total operating costs and expenses | 81,185 | 68,404 | 53,688 | 78,649 | 87,273 | 56,084 | 105,769 | 127,280 | 281,926 | 376,406 | 556,565 |
Operating income (loss) | (1,080) | 3,240 | (13,527) | 18,046 | 26,563 | 68,174 | 46,115 | 24,131 | 6,679 | 164,983 | 73,614 |
Net income (loss) | $ 2,359 | $ 6,477 | $ (22,965) | $ 9,013 | $ 18,559 | $ 49,122 | $ 34,239 | $ 15,490 | $ (5,116) | $ 117,410 | $ 43,693 |
Basic net income (loss) per share (in dollars per share) | $ 0.04 | $ 0.10 | $ (0.41) | $ 0.16 | $ 0.32 | $ 0.83 | $ 0.57 | $ 0.25 | $ (0.08) | $ 1.96 | $ 0.69 |
Diluted net income (loss) per share (in dollars per share) | $ 0.04 | $ 0.10 | $ (0.41) | $ 0.16 | $ 0.31 | $ 0.80 | $ 0.55 | $ 0.24 | $ (0.08) | $ 1.90 | $ 0.67 |
Gains on sales of assets and other, net | $ 4,678 | $ 93,608 | $ 513 | ||||||||
Real Estate | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Gains on sales of assets and other, net | 4,936 | $ 11,874 | $ 0 | ||||||||
Franchised Risk Type | Revenue Benchmark | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Franchise revenue, percentage | 96.00% | 90.00% | |||||||||
Company restaurant sales | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Gains on sales of assets and other, net | 0 | $ 82,866 | $ (746) | ||||||||
Company restaurant sales | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | $ 32,892 | $ 27,849 | $ 15,128 | $ 42,291 | $ 48,803 | $ 63,582 | $ 95,447 | $ 98,545 | 118,160 | 306,377 | 411,932 |
Franchise and license revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total operating revenue | $ 47,213 | $ 43,795 | $ 25,033 | $ 54,404 | $ 65,033 | $ 60,676 | $ 56,437 | $ 52,866 | $ 170,445 | $ 235,012 | $ 218,247 |