Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Nov. 30, 2016 | Jan. 03, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | SONIC CORP. | |
Entity Central Index Key | 868,611 | |
Current Fiscal Year End Date | --08-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2016 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 43,934,660 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Nov. 30, 2016 | Aug. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 41,090 | $ 72,092 |
Restricted cash | 8,406 | 15,873 |
Accounts and notes receivable, net | 31,445 | 35,437 |
Prepaid expenses and other current assets | 18,191 | 14,255 |
Total current assets | 99,132 | 137,657 |
Noncurrent restricted cash | 128 | 140 |
Investment in direct financing lease | 23,830 | 9,859 |
Notes receivable, net | 12,569 | 12,562 |
Property, equipment and capital leases | 711,311 | 766,522 |
Less accumulated depreciation and amortization | (347,252) | (374,142) |
Property, equipment and capital leases, net | 364,059 | 392,380 |
Goodwill | 76,266 | 76,734 |
Debt origination costs, net | 2,928 | 3,093 |
Other assets, net | 14,404 | 16,236 |
Total assets | 593,316 | 648,661 |
Current liabilities: | ||
Accounts payable | 18,062 | 14,372 |
Franchisee deposits | 850 | 720 |
Accrued liabilities | 35,590 | 51,913 |
Income taxes payable | 6,825 | 2,568 |
Current maturities of long-term debt and capital leases | 4,192 | 5,090 |
Total current liabilities | 65,519 | 74,663 |
Obligations under capital leases due after one year | 17,216 | 17,391 |
Long-term debt, net | 566,672 | 566,187 |
Deferred income taxes | 42,247 | 42,530 |
Other non-current liabilities | 19,855 | 23,533 |
Total non-current liabilities | 645,990 | 649,641 |
Stockholders’ deficit: | ||
Preferred stock, par value $.01; 1,000 shares authorized; none outstanding | 0 | 0 |
Common stock, par value $.01; 245,000 shares authorized; 118,309 shares issued (118,309 shares issued at August 31, 2016) | 1,183 | 1,183 |
Paid-in capital | 236,050 | 234,956 |
Retained earnings | 901,201 | 894,442 |
Treasury stock, at cost; 73,615 shares (71,670 shares at August 31, 2016) | (1,256,627) | (1,206,224) |
Total stockholders’ deficit | (118,193) | (75,643) |
Total liabilities and stockholders’ deficit | $ 593,316 | $ 648,661 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Nov. 30, 2016 | Aug. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 245,000,000 | 245,000,000 |
Common stock, issued (in shares) | 118,309,000 | 118,309,000 |
Treasury stock, shares (in shares) | 73,615,000 | 71,670,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Income - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Revenues [Abstract] | ||
Company Drive-In sales | $ 87,152 | $ 103,883 |
Franchise Drive-Ins: | ||
Franchise royalties and fees | 40,139 | 39,922 |
Lease revenue | 1,381 | 1,592 |
Other | 879 | 406 |
Total revenues | 129,551 | 145,803 |
Costs and expenses: | ||
Food and packaging | 24,116 | 28,946 |
Payroll and other employee benefits | 31,766 | 36,364 |
Other operating expenses, exclusive of depreciation and amortization included below | 19,426 | 22,908 |
Total cost of Company Drive-In sales | 75,308 | 88,218 |
Selling, general and administrative | 19,754 | 20,940 |
Depreciation and amortization | 10,277 | 10,999 |
Other operating income, net | (2,840) | (399) |
Total costs and expenses | 102,499 | 119,758 |
Income from operations | 27,052 | 26,045 |
Interest expense | 7,189 | 6,222 |
Interest income | (494) | (100) |
Net interest expense | 6,695 | 6,122 |
Income before income taxes | 20,357 | 19,923 |
Provision for income taxes | 7,239 | 7,465 |
Net income | $ 13,118 | $ 12,458 |
Basic income per share (usd per share) | $ 0.29 | $ 0.25 |
Diluted income per share (usd per share) | 0.28 | 0.24 |
Cash dividends declared per common share (usd per share) | $ 0.14 | $ 0.11 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Cash flows from operating activities: | ||
Net income | $ 13,118 | $ 12,458 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 10,277 | 10,999 |
Stock-based compensation expense | 1,073 | 956 |
Other | (3,028) | (722) |
(Increase) decrease in operating assets: | ||
Restricted cash | 7,472 | 5,355 |
Accounts receivable and other assets | 1,391 | (105) |
Increase (decrease) in operating liabilities: | ||
Accounts payable | 3,284 | 6,282 |
Accrued and other liabilities | (19,361) | (11,962) |
Income taxes | 5,005 | 2,507 |
Total adjustments | 6,113 | 13,310 |
Net cash provided by operating activities | 19,231 | 25,768 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (14,845) | (8,458) |
Proceeds from sale of assets | 10,826 | 1,615 |
Proceeds from sale of investment in refranchised drive-in operations | 6,958 | 0 |
Other | 4,278 | 1,238 |
Net cash provided by (used in) investing activities | 7,217 | (5,605) |
Cash flows from financing activities: | ||
Payments on debt | (1,062) | (32,948) |
Proceeds from borrowings | 0 | 78,000 |
Purchases of treasury stock | (49,096) | (49,572) |
Proceeds from exercise of stock options | 29 | 597 |
Payment of dividends | (6,345) | (5,448) |
Other | (976) | (1,162) |
Net cash used in financing activities | (57,450) | (10,533) |
Net increase (decrease) in cash and cash equivalents | (31,002) | 9,630 |
Cash and cash equivalents at beginning of period | 72,092 | 27,191 |
Cash and cash equivalents at end of period | 41,090 | 36,821 |
Cash paid during the period for: | ||
Interest | 6,700 | 5,748 |
Income taxes (net of refunds) | 2,514 | 5,092 |
Non-cash investing and financing activities: | ||
Additions to direct financing leases from property, equipment and capital leases | 21,082 | 0 |
Net additions to capital lease obligations | 1,433 | 0 |
Change in obligation to acquire treasury stock | $ 1,458 | $ (2,457) |
Basis Of Presentation
Basis Of Presentation | 3 Months Ended |
Nov. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis Of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements of Sonic Corp. (the “Company”). In the opinion of management, these financial statements reflect all adjustments of a normal recurring nature, including recurring accruals, necessary for the fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods presented in conformity with GAAP. In certain situations, recurring accruals, including franchise royalties, are based on more limited information at interim reporting dates than at the Company’s fiscal year end due to the abbreviated reporting period. Actual results may differ from these estimates. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended August 31, 2016 , included in the Company’s Annual Report on Form 10-K. Interim results are not necessarily indicative of the results that may be expected for a full year or any other interim period. Principles of Consolidation The accompanying financial statements include the accounts of the Company, its wholly owned subsidiaries and a number of Company Drive-Ins in which a subsidiary has a controlling ownership interest. All intercompany accounts and transactions have been eliminated. Reclassifications Certain amounts reported in previous years, which are not material, have been combined and reclassified to conform to the current-year presentation. Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” which requires an entity to recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled for the transfer of promised goods or services to customers. The standard also requires additional disclosure regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The ASU will replace most of the existing revenue recognition requirements in U.S. GAAP when it becomes effective. Further, in March 2016, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the guidance in ASU No. 2014-09 for evaluating when another party, along with the entity, is involved in providing a good or service to a customer. In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing,” which clarifies the guidance in ASU No. 2014-09 regarding assessing whether promises to transfer goods or services are distinct, and whether an entity's promise to grant a license provides a customer with a right to use or right to access the entity's intellectual property. The Company plans to adopt the standard in the first quarter of fiscal year 2019, which aligns with the required adoption date. The standards are to be applied retrospectively or using a cumulative effect transition method, with early application not permitted; however, we have not yet decided on a method of transition upon adoption. The Company does not believe the new revenue recognition standard will impact the recognition of sales from Company Drive-Ins or the recognition of royalty fees from franchisees. The Company expects the pronouncement will impact the recognition of the initial franchise fee, which is currently recognized upon the opening of a Franchise Drive-In. The impact on these fees has not yet been estimated and no transition method has been selected. The Company is currently evaluating the effect that this pronouncement will have on the recognition of other transactions, the financial statements and related disclosures. In February 2016, the FASB issued ASU No. 2016-02, “Leases.” The new standard, which replaces existing lease guidance, requires lessees to recognize on the balance sheet a liability to make lease payments and a corresponding right-of-use asset. The guidance also requires certain qualitative and quantitative disclosures designed to assess the amount, timing and uncertainty of cash flows arising from leases. Accounting guidance for lessors is largely unchanged. The standard is effective for fiscal years beginning after December 15, 2018, which will require the Company to adopt the provisions in the first quarter of fiscal 2020, with early application permitted. This standard requires adoption based upon a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with optional practical expedients. Based on a preliminary assessment, the Company expects that most of its operating lease commitments will be subject to the new guidance and recognized as operating lease liabilities and right-of-use assets upon adoption, resulting in a significant increase in the assets and liabilities on our consolidated balance sheet. The Company is continuing its assessment, which may identify additional impacts this standard will have on its consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU No. 2016-04, “Liabilities – Extinguishment of Liabilities: Recognition of Breakage for Certain Prepaid Stored-Value Products,” which is intended to eliminate current and future diversity in practice related to derecognition of prepaid stored-value product liability in a way that aligns with the new revenue recognition guidance. The update is effective for fiscal years beginning after December 15, 2017; however, early application is permitted. The adoption of the update is not expected to have a material impact on the Company’s financial statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses.” The update was issued to provide more decision-useful information about the expected credit losses on financial instruments. The update 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 credit loss estimates. The update is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The update should be adopted using a modified-retrospective approach. The Company is currently evaluating the effect that this update will have on its financial statements and related disclosures. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows – Classification of Certain Cash Receipts and Cash Payments.” The update is intended to reduce diversity in practice in how certain transactions are classified and will make eight targeted changes to how cash receipts and cash payments are presented in the statement of cash flows. The update is effective for fiscal years beginning after December 15, 2017. The new standard will require adoption on a retrospective basis unless it is impracticable to apply, in which case the amendments will apply prospectively as of the earliest date practicable. The Company is currently evaluating the effect of this update but does not believe it will have a material impact on its financial statements and related disclosures. In October 2016, the FASB issued ASU No. 2016-16, "Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory" as part of its simplification initiatives. The update requires that an entity recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than deferring the recognition until the asset has been sold to an outside party as is required under current GAAP. The update is effective for fiscal years beginning after December 15, 2017. The new standard will require adoption on a modified retrospective basis through a cumulative-effect adjustment to retained earnings, and early adoption is permitted. The Company is currently evaluating the effect that this update will have on its financial statements and related disclosures. The Company has reviewed all other recently issued accounting pronouncements and concluded they are not applicable or not expected to be significant to our operations. Recently Adopted Accounting Pronouncements In April 2015, the FASB issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” This update requires debt issuance costs to be presented in the balance sheet as a reduction of the related liability rather than as an asset. The recognition and measurement guidance for debt issuance costs are not affected by this update. This update is effective for fiscal years beginning after December 15, 2015, including interim periods within that reporting period, and is to be applied retrospectively; early adoption is permitted. In August 2015, the FASB issued ASU 2015-15, which addresses the SEC’s comments related to the absence of authoritative guidance within ASU 2015-03 related to line-of-credit arrangements. The SEC would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company retrospectively adopted this guidance in the first quarter of fiscal year 2017, which resulted in a reclassification of unamortized debt issuance costs of $11.3 million related to the Company's fixed rate notes from non-current assets to long-term debt, net, within the Company's consolidated balance sheet, resulting in a corresponding reduction in total assets and total long-term liabilities as of August 31, 2016. Other than this reclassification, the adoption of this ASU did not have any other impact on the Company's consolidated financial statements. As of November 30, 2016, there was $10.8 million of unamortized debt issuance costs related to the Company's fixed rate notes included within long-term debt, net on the Company's condensed consolidated balance sheet. In April 2015, the FASB issued ASU No. 2015-05, “Customer's Accounting for Fees Paid in a Cloud Computing Arrangement.” The update provides clarification on whether a cloud computing arrangement includes a software license. If a software license is included, the customer should account for the license consistent with its accounting of other software licenses. If a software license is not included, the arrangement should be accounted for as a service contract. The update is effective for fiscal years beginning after December 15, 2015. The Company adopted this standard in the first quarter of fiscal year 2017 on a prospective basis. The adoption did not have a material impact on the Company’s consolidated financial statements. During the first quarter of fiscal 2017, the Company early adopted ASU No. 2016-09, “Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting,” which simplifies several aspects of accounting for share-based payment transactions, including excess tax benefits, an accounting policy election for forfeitures, statutory tax withholding requirements and classification in the statements of cash flows. As required by the update, on a prospective basis, the Company recognized excess tax benefits related to share-based payments in our provision for income taxes in the condensed consolidated statements of income. These items were historically recorded in additional paid-in capital. As allowed by the update, on a prospective basis, cash flows related to excess tax benefits recognized on stock-based compensation expense are classified as an operating activity in the Company's condensed consolidated statements of cash flows. These prospective changes did not have a material impact on the Company's financial statements for the first quarter of fiscal year 2017. Cash paid on employees’ behalf related to shares withheld for tax purposes continues to be classified as a financing activity. Our stock compensation expense continues to reflect estimated forfeitures. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Nov. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share: Three months ended November 30, 2016 2015 Numerator: Net income $ 13,118 $ 12,458 Denominator: Weighted average common shares outstanding– basic 45,720 50,221 Effect of dilutive employee stock options and unvested restricted stock units 823 1,104 Weighted average common shares outstanding – diluted 46,543 51,325 Net income per common share – basic $ 0.29 $ 0.25 Net income per common share – diluted $ 0.28 $ 0.24 Anti-dilutive securities excluded (1) 821 412 __________________ (1) Anti-dilutive securities consist of stock options and unvested restricted stock units that were not included in the computation of diluted earnings per share because either the exercise price of the options was greater than the average market price of the common stock or the total assumed proceeds under the treasury stock method resulted in negative incremental shares and thus the inclusion would have been anti-dilutive. |
Share Repurchase Program
Share Repurchase Program | 3 Months Ended |
Nov. 30, 2016 | |
Equity [Abstract] | |
Share Repurchase Program | Share Repurchase Program In August 2015, the Company’s Board of Directors extended the Company’s share repurchase program, authorizing the Company to purchase up to $145.0 million of its outstanding shares of common stock to be repurchased through August 31, 2016. The Board of Directors further extended the share repurchase program effective May 2016, authorizing the purchase of up to an additional $155.0 million of our outstanding shares of common stock through August 31, 2017. During fiscal year 2016, approximately 5.2 million shares were repurchased for a total cost of $148.3 million , resulting in an average price per share of $28.48 . In October 2016, the Company's Board of Directors increased the authorization under the share repurchase program by $40.0 million . During the first three months of fiscal year 2017 , approximately 2.0 million shares were repurchased for a total cost of $50.6 million , resulting in an average price per share of $25.87 . The total remaining amount authorized under the share repurchase program as of November 30, 2016 was $122.4 million . Share repurchases may be made from time to time in the open market or otherwise, including through an accelerated share repurchase program, under terms of a Rule 10b5-1 plan, in privately negotiated transactions or in round lot or block transactions. The share repurchase program may be extended, modified, suspended or discontinued at any time. |
Income Taxes
Income Taxes | 3 Months Ended |
Nov. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table presents the Company’s provision for income taxes and effective income tax rate for the periods below: Three months ended November 30, 2016 2015 Provision for income taxes $ 7,239 $ 7,465 Effective income tax rate 35.6 % 37.5 % The higher effective tax rate in the first quarter of fiscal year 2016 was primarily attributable to a decrease in employment tax credits due to expired credit provisions. |
Accounts And Notes Receivable
Accounts And Notes Receivable | 3 Months Ended |
Nov. 30, 2016 | |
Receivables [Abstract] | |
Accounts And Notes Receivable | Accounts and Notes Receivable Accounts and notes receivable consist of the following: November 30, August 31, Current Accounts and Notes Receivable: Royalties and other trade receivables $ 16,873 $ 19,994 Notes receivable from franchisees 2,270 5,531 Receivables from system funds 4,207 4,372 Other 9,077 6,507 Accounts and notes receivable, gross 32,427 36,404 Allowance for doubtful accounts and notes receivable (982 ) (967 ) Current accounts and notes receivable, net $ 31,445 $ 35,437 Noncurrent Notes Receivable: Receivables from franchisees $ 7,070 $ 7,170 Receivables from system funds 5,558 5,466 Allowance for doubtful notes receivable (59 ) (74 ) Noncurrent notes receivable, net $ 12,569 $ 12,562 The Company’s receivables are primarily due from franchisees, all of whom are in the restaurant business. Substantially all of the notes receivable from franchisees are collateralized by real estate or equipment. The receivables from system funds represent transactions in the normal course of business. The decrease in current notes receivable from franchisees is due to short-term financing for refranchised drive-ins and newly constructed drive-ins sold to franchisees that were established in fiscal year 2016 and were repaid in the first quarter of fiscal year 2017. The increase in other current accounts and notes receivable is due to the timing of various receipts and disbursements. |
Contingencies
Contingencies | 3 Months Ended |
Nov. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies The Company is involved in various legal proceedings and has certain unresolved claims pending. Based on the information currently available, management believes that all claims currently pending are either covered by insurance or would not have a material adverse effect on the Company’s business, operating results or financial condition. On December 20, 2013, the Company extended a note purchase agreement to a bank that serves to guarantee the repayment of a franchisee loan, with a term through 2018 . In the event of default by the franchisee, the Company would purchase the franchisee loan from the bank, thereby becoming the note holder and providing an avenue of recourse with the franchisee. The Company recorded a liability for this guarantee which was based on the Company’s estimate of fair value. As of November 30, 2016 , the balance of the franchisee’s loan was $5.7 million . The Company has obligations under various operating lease agreements with third-party lessors related to the real estate for certain Company Drive-In operations that were sold to franchisees. Under these agreements, which expire through 2029 , the Company remains secondarily liable for the lease payments for which it was responsible as the original lessee. As of November 30, 2016 , the amount remaining under these guaranteed lease obligations totaled $6.9 million . At this time, the Company does not anticipate any material defaults under the foregoing leases; therefore, zero liability has been provided. |
Fair Value Of Financial Instrum
Fair Value Of Financial Instruments | 3 Months Ended |
Nov. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Of Financial Instruments | Fair Value of Financial Instruments The fair value of financial instruments is the amount at which the instrument could be exchanged in a current transaction between willing parties. The Company has no financial liabilities that are required to be measured at fair value on a recurring basis. The Company categorizes its assets and liabilities recorded at fair value based on the following fair value hierarchy established by the FASB: • Level 1 valuations use quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date. An active market is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. • Level 2 valuations use inputs other than actively quoted market prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include: (a) quoted prices for similar assets or liabilities in active markets, (b) quoted prices for identical or similar assets or liabilities in markets that are not active, (c) inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves observable at commonly quoted intervals and (d) inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3 valuations use unobservable inputs for the asset or liability. Unobservable inputs are used to the extent observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. The Company’s cash equivalents, some of which are included in restricted cash, are carried at cost which approximates fair value and totaled $28.1 million at November 30, 2016 and $59.2 million at August 31, 2016 . This fair value is estimated using Level 1 inputs. At November 30, 2016 and August 31, 2016, the fair value of the Company’s Series 2016-1 Senior Secured Fixed Rate Notes, Class A-2 (the "2016 Fixed Rate Notes") and Series 2013-1 Senior Secured Fixed Rate Notes, Class A-2 (the “2013 Fixed Rate Notes” and, together with the 2016 Fixed Rate Notes, the “Fixed Rate Notes”) approximated the carrying value, including accrued interest, of $578.6 million , and $579.6 million , respectively. The fair value of the Fixed Rate Notes is estimated using Level 2 inputs from market information available for public debt transactions for companies with ratings that are similar to the Company’s ratings and from information gathered from brokers who trade in the Company’s notes. |
Other Operating Income
Other Operating Income | 3 Months Ended |
Nov. 30, 2016 | |
Other Income and Expenses [Abstract] | |
Other Operating Income | Other Operating Income During the first quarter of fiscal year 2017, the Company recorded a gain of $3.8 million on the sale of minority investments in franchise operations retained as part of a refranchising transaction that occurred in fiscal year 2009. The gain is reflected in other operating income, net on the condensed consolidated statement of income. |
Refranchising Initiative
Refranchising Initiative | 3 Months Ended |
Nov. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Refranchising Initiative | Refranchising Initiative Refranchising Transactions In June 2016, the Company announced plans to refranchise Company Drive-Ins as part of a refranchising initiative to move toward an approximately 95% -franchised system. During the first quarter of fiscal year 2017 , the Company completed two transactions to refranchise the operations of 56 Company Drive-Ins and retained a non-controlling minority investment in the franchise operations. During fiscal year 2016, the Company refranchised the operations of 38 Company Drive-Ins. Of the Company Drive-Ins refranchised in fiscal year 2016, 29 were completed as part of the refranchising initiative announced in June 2016. The Company retained a non-controlling minority investment in the franchise operations of 25 of these refranchised drive-ins. Income from minority investments is included in other revenue on the condensed consolidated statements of income. Gains and losses associated with refranchised drive-ins are recorded in other operating income, net on the condensed consolidated statement of income. The following is a summary of the pretax activity recorded as a result of the refranchising initiative: Three months ended November 30, 2016 Number of Company Drive-Ins sold to franchisees 56 Proceeds from sales of Company Drive-Ins $ 8,950 Assets sold, net of retained minority investment (1) (5,461 ) Goodwill related to sales of Company Drive-Ins (377 ) Initial lease payment for real estate option (2) (3,810 ) Loss on assets held for sale (259 ) Refranchising initiative gains (losses), net $ (957 ) _______________ (1) Net assets sold consisted primarily of equipment. (2) As part of a 53 drive-in refranchising transaction, the Company entered into a direct financing lease which includes an option for the franchisee to purchase the real estate within the next 24 months. In accordance with lease accounting requirements, since the exercise of this option can occur at any time within the next 24 months, the portion of the proceeds from the refranchising attributable to the fair value of the option represents the initial minimum lease payment for the real estate. Unless and until the option is exercised or expires, the franchisee will make monthly lease payments of $0.3 million through November 2017 and $0.1 million thereafter, through November 2018, which will be included in other operating income. Refranchising Initiative Number of Company Drive-Ins sold to franchisees (1) 29 Proceeds from sales of Company Drive-Ins $ 3,568 Assets sold, net of retained minority investment (2) (2,402 ) Goodwill related to sales of Company Drive-Ins (194 ) Refranchising initiative gains (losses), net $ 972 _______________ (1) Company Drive-Ins refranchised as part of the refranchising initiative announced in June 2016. (2) Net assets sold consisted primarily of equipment. Direct Financing Leases As part of the refranchising initiative, the Company entered into direct franchising leases ("DFLs") in fiscal year 2016 and the first quarter of fiscal year 2017. Components of net investment in direct financing leases are as follows at November 30: November 30, August 31, Minimum lease payments receivable $ 33,490 $ 15,108 Less unearned income (6,483 ) (5,134 ) Net investment in direct financing lease 27,007 9,974 Less amount due within one year (3,177 ) (115 ) Amount due after one year $ 23,830 $ 9,859 Future minimum rental payments receivable as of November 30, 2016 are as follows: Direct Financing Lease Years ended August 31: 2017 $ 744 2018 3,948 2019 13,132 2020 1,230 2021 1,325 Thereafter 13,111 33,490 Less unearned income (6,483 ) $ 27,007 Initial direct costs incurred in the negotiations and consummations of direct financing lease transactions have not been material. Accordingly, no portion of unearned income has been recognized to offset those costs. Assets Held for Sale Assets held for sale consist of Company Drive-Ins that are expected to sell within one year as part of the Company’s refranchising initiative. Such assets are classified as assets held for sale upon meeting the requirements of ASC 360, “Accounting for the Impairment or Disposal of Long-Lived Assets” and are included in other assets, net on the Company's condensed consolidated balance sheet. These assets are recorded at the lower of the carrying amounts or fair values less costs to sell. Assets are no longer depreciated once classified as held for sale. The following table sets forth the components of assets held for sale: November 30, August 31, Property and equipment, net (1) $ 7,558 $ 5,299 Goodwill, net 90 — Total assets held for sale $ 7,648 $ 5,299 ________________ (1) Includes loss on anticipated sale of $0.3 million to reflect assets at fair value. In the first quarter of fiscal year 2017, a $0.3 million loss on the anticipated sale of 19 Company Drive-Ins was recorded. Property, equipment and goodwill associated with these locations was included in assets held for sale as of November 30, 2016. Subsequent to the end of the first quarter, the anticipated transaction was completed and the Company maintained a non-controlling minority investment in all of the drive-ins. |
Basis Of Presentation (Policy)
Basis Of Presentation (Policy) | 3 Months Ended |
Nov. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles Of Consolidation | Principles of Consolidation The accompanying financial statements include the accounts of the Company, its wholly owned subsidiaries and a number of Company Drive-Ins in which a subsidiary has a controlling ownership interest. All intercompany accounts and transactions have been eliminated. |
Reclassifications | Reclassifications Certain amounts reported in previous years, which are not material, have been combined and reclassified to conform to the current-year presentation. |
New Accounting Pronouncements | Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” which requires an entity to recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled for the transfer of promised goods or services to customers. The standard also requires additional disclosure regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The ASU will replace most of the existing revenue recognition requirements in U.S. GAAP when it becomes effective. Further, in March 2016, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the guidance in ASU No. 2014-09 for evaluating when another party, along with the entity, is involved in providing a good or service to a customer. In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing,” which clarifies the guidance in ASU No. 2014-09 regarding assessing whether promises to transfer goods or services are distinct, and whether an entity's promise to grant a license provides a customer with a right to use or right to access the entity's intellectual property. The Company plans to adopt the standard in the first quarter of fiscal year 2019, which aligns with the required adoption date. The standards are to be applied retrospectively or using a cumulative effect transition method, with early application not permitted; however, we have not yet decided on a method of transition upon adoption. The Company does not believe the new revenue recognition standard will impact the recognition of sales from Company Drive-Ins or the recognition of royalty fees from franchisees. The Company expects the pronouncement will impact the recognition of the initial franchise fee, which is currently recognized upon the opening of a Franchise Drive-In. The impact on these fees has not yet been estimated and no transition method has been selected. The Company is currently evaluating the effect that this pronouncement will have on the recognition of other transactions, the financial statements and related disclosures. In February 2016, the FASB issued ASU No. 2016-02, “Leases.” The new standard, which replaces existing lease guidance, requires lessees to recognize on the balance sheet a liability to make lease payments and a corresponding right-of-use asset. The guidance also requires certain qualitative and quantitative disclosures designed to assess the amount, timing and uncertainty of cash flows arising from leases. Accounting guidance for lessors is largely unchanged. The standard is effective for fiscal years beginning after December 15, 2018, which will require the Company to adopt the provisions in the first quarter of fiscal 2020, with early application permitted. This standard requires adoption based upon a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with optional practical expedients. Based on a preliminary assessment, the Company expects that most of its operating lease commitments will be subject to the new guidance and recognized as operating lease liabilities and right-of-use assets upon adoption, resulting in a significant increase in the assets and liabilities on our consolidated balance sheet. The Company is continuing its assessment, which may identify additional impacts this standard will have on its consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU No. 2016-04, “Liabilities – Extinguishment of Liabilities: Recognition of Breakage for Certain Prepaid Stored-Value Products,” which is intended to eliminate current and future diversity in practice related to derecognition of prepaid stored-value product liability in a way that aligns with the new revenue recognition guidance. The update is effective for fiscal years beginning after December 15, 2017; however, early application is permitted. The adoption of the update is not expected to have a material impact on the Company’s financial statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses.” The update was issued to provide more decision-useful information about the expected credit losses on financial instruments. The update 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 credit loss estimates. The update is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The update should be adopted using a modified-retrospective approach. The Company is currently evaluating the effect that this update will have on its financial statements and related disclosures. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows – Classification of Certain Cash Receipts and Cash Payments.” The update is intended to reduce diversity in practice in how certain transactions are classified and will make eight targeted changes to how cash receipts and cash payments are presented in the statement of cash flows. The update is effective for fiscal years beginning after December 15, 2017. The new standard will require adoption on a retrospective basis unless it is impracticable to apply, in which case the amendments will apply prospectively as of the earliest date practicable. The Company is currently evaluating the effect of this update but does not believe it will have a material impact on its financial statements and related disclosures. In October 2016, the FASB issued ASU No. 2016-16, "Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory" as part of its simplification initiatives. The update requires that an entity recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than deferring the recognition until the asset has been sold to an outside party as is required under current GAAP. The update is effective for fiscal years beginning after December 15, 2017. The new standard will require adoption on a modified retrospective basis through a cumulative-effect adjustment to retained earnings, and early adoption is permitted. The Company is currently evaluating the effect that this update will have on its financial statements and related disclosures. The Company has reviewed all other recently issued accounting pronouncements and concluded they are not applicable or not expected to be significant to our operations. Recently Adopted Accounting Pronouncements In April 2015, the FASB issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” This update requires debt issuance costs to be presented in the balance sheet as a reduction of the related liability rather than as an asset. The recognition and measurement guidance for debt issuance costs are not affected by this update. This update is effective for fiscal years beginning after December 15, 2015, including interim periods within that reporting period, and is to be applied retrospectively; early adoption is permitted. In August 2015, the FASB issued ASU 2015-15, which addresses the SEC’s comments related to the absence of authoritative guidance within ASU 2015-03 related to line-of-credit arrangements. The SEC would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company retrospectively adopted this guidance in the first quarter of fiscal year 2017, which resulted in a reclassification of unamortized debt issuance costs of $11.3 million related to the Company's fixed rate notes from non-current assets to long-term debt, net, within the Company's consolidated balance sheet, resulting in a corresponding reduction in total assets and total long-term liabilities as of August 31, 2016. Other than this reclassification, the adoption of this ASU did not have any other impact on the Company's consolidated financial statements. As of November 30, 2016, there was $10.8 million of unamortized debt issuance costs related to the Company's fixed rate notes included within long-term debt, net on the Company's condensed consolidated balance sheet. In April 2015, the FASB issued ASU No. 2015-05, “Customer's Accounting for Fees Paid in a Cloud Computing Arrangement.” The update provides clarification on whether a cloud computing arrangement includes a software license. If a software license is included, the customer should account for the license consistent with its accounting of other software licenses. If a software license is not included, the arrangement should be accounted for as a service contract. The update is effective for fiscal years beginning after December 15, 2015. The Company adopted this standard in the first quarter of fiscal year 2017 on a prospective basis. The adoption did not have a material impact on the Company’s consolidated financial statements. During the first quarter of fiscal 2017, the Company early adopted ASU No. 2016-09, “Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting,” which simplifies several aspects of accounting for share-based payment transactions, including excess tax benefits, an accounting policy election for forfeitures, statutory tax withholding requirements and classification in the statements of cash flows. As required by the update, on a prospective basis, the Company recognized excess tax benefits related to share-based payments in our provision for income taxes in the condensed consolidated statements of income. These items were historically recorded in additional paid-in capital. As allowed by the update, on a prospective basis, cash flows related to excess tax benefits recognized on stock-based compensation expense are classified as an operating activity in the Company's condensed consolidated statements of cash flows. These prospective changes did not have a material impact on the Company's financial statements for the first quarter of fiscal year 2017. Cash paid on employees’ behalf related to shares withheld for tax purposes continues to be classified as a financing activity. Our stock compensation expense continues to reflect estimated forfeitures. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Nov. 30, 2016 | |
Earnings Per Share [Abstract] | |
Computation Of Basic And Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share: Three months ended November 30, 2016 2015 Numerator: Net income $ 13,118 $ 12,458 Denominator: Weighted average common shares outstanding– basic 45,720 50,221 Effect of dilutive employee stock options and unvested restricted stock units 823 1,104 Weighted average common shares outstanding – diluted 46,543 51,325 Net income per common share – basic $ 0.29 $ 0.25 Net income per common share – diluted $ 0.28 $ 0.24 Anti-dilutive securities excluded (1) 821 412 __________________ (1) Anti-dilutive securities consist of stock options and unvested restricted stock units that were not included in the computation of diluted earnings per share because either the exercise price of the options was greater than the average market price of the common stock or the total assumed proceeds under the treasury stock method resulted in negative incremental shares and thus the inclusion would have been anti-dilutive. |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Nov. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule Of Provision (Benefit) For Income Taxes And Effective Income Tax Rate | The following table presents the Company’s provision for income taxes and effective income tax rate for the periods below: Three months ended November 30, 2016 2015 Provision for income taxes $ 7,239 $ 7,465 Effective income tax rate 35.6 % 37.5 % |
Accounts And Notes Receivable (
Accounts And Notes Receivable (Tables) | 3 Months Ended |
Nov. 30, 2016 | |
Receivables [Abstract] | |
Schedule Of Accounts And Notes Receivable | Accounts and notes receivable consist of the following: November 30, August 31, Current Accounts and Notes Receivable: Royalties and other trade receivables $ 16,873 $ 19,994 Notes receivable from franchisees 2,270 5,531 Receivables from system funds 4,207 4,372 Other 9,077 6,507 Accounts and notes receivable, gross 32,427 36,404 Allowance for doubtful accounts and notes receivable (982 ) (967 ) Current accounts and notes receivable, net $ 31,445 $ 35,437 Noncurrent Notes Receivable: Receivables from franchisees $ 7,070 $ 7,170 Receivables from system funds 5,558 5,466 Allowance for doubtful notes receivable (59 ) (74 ) Noncurrent notes receivable, net $ 12,569 $ 12,562 |
Refranchising Initiative (Table
Refranchising Initiative (Tables) | 3 Months Ended |
Nov. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Summary of the pretax activity recorded as a result of the refranchising initiative | The following is a summary of the pretax activity recorded as a result of the refranchising initiative: Three months ended November 30, 2016 Number of Company Drive-Ins sold to franchisees 56 Proceeds from sales of Company Drive-Ins $ 8,950 Assets sold, net of retained minority investment (1) (5,461 ) Goodwill related to sales of Company Drive-Ins (377 ) Initial lease payment for real estate option (2) (3,810 ) Loss on assets held for sale (259 ) Refranchising initiative gains (losses), net $ (957 ) _______________ (1) Net assets sold consisted primarily of equipment. (2) As part of a 53 drive-in refranchising transaction, the Company entered into a direct financing lease which includes an option for the franchisee to purchase the real estate within the next 24 months. In accordance with lease accounting requirements, since the exercise of this option can occur at any time within the next 24 months, the portion of the proceeds from the refranchising attributable to the fair value of the option represents the initial minimum lease payment for the real estate. Unless and until the option is exercised or expires, the franchisee will make monthly lease payments of $0.3 million through November 2017 and $0.1 million thereafter, through November 2018, which will be included in other operating income. Refranchising Initiative Number of Company Drive-Ins sold to franchisees (1) 29 Proceeds from sales of Company Drive-Ins $ 3,568 Assets sold, net of retained minority investment (2) (2,402 ) Goodwill related to sales of Company Drive-Ins (194 ) Refranchising initiative gains (losses), net $ 972 _______________ (1) Company Drive-Ins refranchised as part of the refranchising initiative announced in June 2016. (2) Net assets sold consisted primarily of equipment. |
Components of net investment in direct financing leases | Components of net investment in direct financing leases are as follows at November 30: November 30, August 31, Minimum lease payments receivable $ 33,490 $ 15,108 Less unearned income (6,483 ) (5,134 ) Net investment in direct financing lease 27,007 9,974 Less amount due within one year (3,177 ) (115 ) Amount due after one year $ 23,830 $ 9,859 |
Future minimum rental payments receivable | Future minimum rental payments receivable as of November 30, 2016 are as follows: Direct Financing Lease Years ended August 31: 2017 $ 744 2018 3,948 2019 13,132 2020 1,230 2021 1,325 Thereafter 13,111 33,490 Less unearned income (6,483 ) $ 27,007 |
Components of assets held for sale | The following table sets forth the components of assets held for sale: November 30, August 31, Property and equipment, net (1) $ 7,558 $ 5,299 Goodwill, net 90 — Total assets held for sale $ 7,648 $ 5,299 ________________ (1) Includes loss on anticipated sale of $0.3 million to reflect assets at fair value. |
Basis Of Presentation Unamortiz
Basis Of Presentation Unamortized debt issuance costs (Narrative) (Details) - USD ($) $ in Millions | Nov. 30, 2016 | Aug. 31, 2016 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Unamortized debt issuance costs | $ 10.8 | |
Accounting Standards Update 2015-03 [Member] | Other Noncurrent Assets [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Unamortized debt issuance costs | $ (11.3) | |
Accounting Standards Update 2015-03 [Member] | Long-term Debt, Net [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Unamortized debt issuance costs | $ 11.3 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Earnings Per Share [Abstract] | ||
Net income | $ 13,118 | $ 12,458 |
Weighted average common shares outstanding– basic (in shares) | 45,720 | 50,221 |
Effect of dilutive employee stock options and unvested restricted stock units (in shares) | 823 | 1,104 |
Weighted average common shares outstanding – diluted (in shares) | 46,543 | 51,325 |
Net income per common share – basic (usd per share) | $ 0.29 | $ 0.25 |
Net income per common share – diluted (usd per share) | $ 0.28 | $ 0.24 |
Anti-dilutive securities excluded (in shares) | 821 | 412 |
Share Repurchase Program (Detai
Share Repurchase Program (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||
Nov. 30, 2016 | Aug. 31, 2016 | Oct. 31, 2016 | May 31, 2016 | Aug. 31, 2015 | |
Equity [Abstract] | |||||
Shares repurchase authorized amount | $ 40 | $ 155 | $ 145 | ||
Shares acquired through stock repurchase program | 2 | 5.2 | |||
Purchase of treasury stock | $ 50.6 | $ 148.3 | |||
Weighted-average price per share | $ 25.87 | $ 28.48 | |||
Remaining amount authorized for repurchase through share repurchase program | $ 122.4 |
Income Taxes (Schedule Of Provi
Income Taxes (Schedule Of Provision (Benefit) For Income Taxes And Effective Income Tax Rate) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||
Provision for income taxes | $ 7,239 | $ 7,465 |
Effective income tax rate | 35.60% | 37.50% |
Accounts And Notes Receivable24
Accounts And Notes Receivable (Details) - USD ($) $ in Thousands | Nov. 30, 2016 | Aug. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Royalties and other trade receivables | $ 16,873 | $ 19,994 |
Current accounts and notes receivable, gross | 32,427 | 36,404 |
Allowance for doubtful accounts and notes receivable | (982) | (967) |
Current accounts and notes receivable, net | 31,445 | 35,437 |
Allowance for doubtful notes receivable | (59) | (74) |
Noncurrent notes receivable, net | 12,569 | 12,562 |
Notes Receivable From Franchisees [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current accounts and notes receivable, gross | 2,270 | 5,531 |
Noncurrent accounts and notes receivable, gross | 7,070 | 7,170 |
Receivables From System Funds [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current accounts and notes receivable, gross | 4,207 | 4,372 |
Noncurrent accounts and notes receivable, gross | 5,558 | 5,466 |
Other [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current accounts and notes receivable, gross | $ 9,077 | $ 6,507 |
Contingencies (Details)
Contingencies (Details) | 3 Months Ended |
Nov. 30, 2016USD ($) | |
Note Repurchase Agreement [Member] | |
Loss Contingencies [Line Items] | |
Guarantor Obligations, Term | 2,018 |
Guaranteed obligations | $ 5,700,000 |
Guarantee Operating Lease Obligations [Member] | |
Loss Contingencies [Line Items] | |
Guarantor Obligations, Term | 2,029 |
Guaranteed obligations | $ 6,900,000 |
Guaranteed liability, carrying value | $ 0 |
Fair Value Of Financial Instr26
Fair Value Of Financial Instruments (Narrative) (Details) - USD ($) $ in Millions | Nov. 30, 2016 | Aug. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents carried at cost | $ 28.1 | $ 59.2 |
2016 and 2013 Fixed Rate Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, carrying value, including accrued interest | 578.6 | 579.6 |
2016 and 2013 Fixed Rate Notes [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | $ 578.6 | $ 579.6 |
Other Operating Income (Details
Other Operating Income (Details) $ in Millions | 3 Months Ended |
Nov. 30, 2016USD ($) | |
Other Income and Expenses [Abstract] | |
Gain on sale of investments in franchise operations | $ 3.8 |
Refranchising Initiative Refran
Refranchising Initiative Refranchising Initiative (Narrative) (Details) - franchise | 3 Months Ended | 12 Months Ended | |
Nov. 30, 2016 | Aug. 31, 2016 | Jun. 30, 2016 | |
Franchisor Disclosure [Line Items] | |||
Franchise restaurant ownership target | 95.00% | ||
Refranchised Company Drive-Ins | 56 | 38 | |
Non-controlling operating interest [Member] | |||
Franchisor Disclosure [Line Items] | |||
Refranchised Company Drive-Ins | 25 |
Refranchising Initiative Summar
Refranchising Initiative Summary of the pretax activity recorded as a result of the refranchising initiative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Nov. 30, 2016USD ($)franchise | Nov. 30, 2015USD ($) | Nov. 30, 2018USD ($) | Nov. 30, 2017USD ($) | Aug. 31, 2016USD ($)franchise | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of Company Drive-Ins sold to franchisees | franchise | 56 | 38 | |||
Proceeds from sales of Company Drive-Ins | $ 10,826 | $ 1,615 | |||
Goodwill related to sales of Company Drive-Ins | $ (76,266) | $ (76,734) | |||
Refranchising Initiative 2017 [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of Company Drive-Ins sold to franchisees | franchise | 56 | ||||
Proceeds from sales of Company Drive-Ins | $ 8,950 | ||||
Assets sold, net of retained minority investment | (5,461) | ||||
Goodwill related to sales of Company Drive-Ins | (377) | ||||
Initial lease payment for real estate option | (3,810) | ||||
Loss on assets held for sale | (259) | ||||
Refranchising initiative gains (losses), net | $ (957) | ||||
Refranchised Company Drive-Ins with direct financing lease | franchise | 53 | ||||
Refranchising Initiative 2017 [Member] | Forecast [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Monthly lease payments receivable | $ 100 | $ 300 | |||
Refranchising Initiative 2016 [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of Company Drive-Ins sold to franchisees | franchise | 29 | ||||
Proceeds from sales of Company Drive-Ins | $ 3,568 | ||||
Assets sold, net of retained minority investment | (2,402) | ||||
Goodwill related to sales of Company Drive-Ins | (194) | ||||
Refranchising initiative gains (losses), net | $ 972 |
Refranchising Initiative Compon
Refranchising Initiative Components of net investment in direct financing leases (Details) - USD ($) $ in Thousands | Nov. 30, 2016 | Aug. 31, 2016 |
Receivables [Abstract] | ||
Minimum lease payments receivable | $ 33,490 | $ 15,108 |
Less unearned income | (6,483) | (5,134) |
Net investment in direct financing lease | 27,007 | 9,974 |
Less amount due within one year | (3,177) | (115) |
Amount due after one year | $ 23,830 | $ 9,859 |
Refranchising Initiative Future
Refranchising Initiative Future minimum payments receivable (Details) - USD ($) $ in Thousands | Nov. 30, 2016 | Aug. 31, 2016 |
Receivables [Abstract] | ||
2,017 | $ 744 | |
2,018 | 3,948 | |
2,019 | 13,132 | |
2,020 | 1,230 | |
2,021 | 1,325 | |
Thereafter | 13,111 | |
Minimum lease payments receivable | 33,490 | $ 15,108 |
Less unearned income | (6,483) | (5,134) |
Net investment in direct financing lease | $ 27,007 | $ 9,974 |
Refranchising Initiative Assets
Refranchising Initiative Assets Held for Sale (Details) $ in Thousands | 3 Months Ended | |
Nov. 30, 2016USD ($)franchise | Aug. 31, 2016USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Company Drive-Ins to be Sold | franchise | 19 | |
Property and equipment, net | $ 7,558 | $ 5,299 |
Goodwill, net | 90 | 0 |
Total assets held for sale | 7,648 | $ 5,299 |
Refranchising Initiative 2017 [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Fair value adjustment on assets held for sale | $ 259 |