DALLAS, May 3, 2023
/PRNewswire/ -- Brinker International, Inc. (NYSE: EAT) today
announced its financial results, for the third quarter ended
March 29, 2023.
Third Quarter Fiscal 2023 Financial
Highlights
Brinker International reported net income per diluted share of
$1.12, in the third quarter of fiscal
2023, a 38% increase compared to the third quarter of fiscal 2022.
Net income per diluted share, excluding special items (non-GAAP),
was $1.23 in the third quarter of
fiscal 2023, a 33.7% increase compared to the third quarter of
fiscal 2022. Our results for the third quarter of fiscal 2023 were
driven by an increase in company sales as well as improved food,
beverage, and labor costs. Chili's comparable restaurant sales were
9.6% and Maggiano's were 21.6% resulting in a 10.8% increase for
Brinker. Comparable restaurant sales improved due to menu pricing
and favorable item mix. These operational improvements resulted in
operating income margin increasing to 5.9% and restaurant operating
margin (non-GAAP) increasing to 13.4% for the third quarter.
Chili's initiated an updated marketing strategy focused on TV,
digital, and social media advertising and continued to improve the
guest experience by strengthening investments in restaurant
facilities and labor.
"We are pleased to report quarterly operating performance for
Brinker International that represents a nice step forward for our
strategy, enabling us to make needed investments into the business,
translating into an improved guest experience," said Kevin Hochman, Chief Executive Officer and
President of Brinker International. "In the quarter, we also
reengaged our Guests with a broader Chili's marketing campaign
including TV, digital and social media. The campaign was well
received by our Guests and is clearly a sales lever we can use to
drive future results."
Third Quarter Financial Results
|
Third
Quarter
|
|
2023
|
|
2022
|
|
Variance
|
Company
sales(1)
|
$ 1,072.9
|
|
$
970.9
|
|
$
102.0
|
Total
revenues
|
$ 1,083.2
|
|
$
980.4
|
|
$
102.8
|
|
|
|
|
|
|
Operating
income
|
$ 64.2
|
|
$ 49.4
|
|
$ 14.8
|
Operating income as a
percentage of Total revenues
|
5.9 %
|
|
5.0 %
|
|
0.9 %
|
Restaurant operating
margin, non-GAAP(1)(2)
|
$
143.3
|
|
$
127.4
|
|
$ 15.9
|
Restaurant operating
margin as a percentage of Company sales,
non-GAAP(1)(2)
|
13.4 %
|
|
13.1 %
|
|
0.3 %
|
Net income
|
$ 50.7
|
|
$ 36.6
|
|
$ 14.1
|
Adjusted EBITDA,
non-GAAP(2)
|
$
113.0
|
|
$ 97.7
|
|
$ 15.3
|
|
|
|
|
|
|
Net income per diluted
share
|
$ 1.12
|
|
$ 0.81
|
|
$ 0.31
|
Net income per diluted
share, excluding special items, non-GAAP(2)
|
$ 1.23
|
|
$ 0.92
|
|
$ 0.31
|
Comparable Restaurant Sales(3)
|
Q3:23 vs
22
|
Brinker
|
10.8 %
|
Chili's
|
9.6 %
|
Maggiano's
|
21.6 %
|
|
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section below for more details.
|
(2)
|
See Non-GAAP
Information and Reconciliations section below for more
details.
|
(3)
|
Comparable Restaurant
Sales include restaurants that have been in operation for more than
18 full months. Restaurants temporarily closed for 14 days or more
are excluded from comparable restaurant sales. Percentage amounts
are calculated based on the comparable periods
year-over-year.
|
Basis of Presentation
Effective for the first quarter of fiscal 2023, we are
presenting certain revenue streams within Company sales to better
align with the presentation used within the casual dining industry.
Our presentation of Franchise revenues will now include only
revenues related to the franchise-operated restaurants. Comparative
figures in prior years have been adjusted to conform to the current
year's presentation. These reclassifications have no effect on
Total revenues or Net income previously reported.
Company sales include revenues generated by the operation
of Company-owned restaurants including food and beverage sales, net
of discounts, gift card breakage, Maggiano's banquet service charge
income, delivery, digital entertainment revenues, merchandise
income and gift card discount costs from third-party gift card
sales.
Franchise revenues include franchise royalties, franchise
advertising fees, franchise and development fees and gift card
program fees.
Third Quarter of Fiscal 2023 Operating
Performance
Segment Performance
The table below presents selected financial information (in
millions, except as noted) related to our segments' operational
performance for the thirteen week periods ended March 29, 2023 and March
30, 2022:
|
Chili's
|
|
Maggiano's
|
|
Third
Quarter
|
|
Variance
|
|
Third
Quarter
|
|
Variance
|
|
2023
|
|
2022
|
|
|
2023
|
|
2022
|
|
Company
sales(1)
|
$ 953.2
|
|
$ 870.2
|
|
$ 83.0
|
|
$ 119.7
|
|
$ 100.7
|
|
$ 19.0
|
Franchise
revenues(1)
|
10.2
|
|
9.4
|
|
0.8
|
|
0.1
|
|
0.1
|
|
—
|
Total
revenues
|
$ 963.4
|
|
$ 879.6
|
|
$ 83.8
|
|
$ 119.8
|
|
$ 100.8
|
|
$ 19.0
|
|
|
|
|
|
|
|
|
|
|
|
|
Company restaurant
expenses(2)
|
$ 827.4
|
|
$ 755.8
|
|
$ 71.6
|
|
$ 101.9
|
|
$ 87.5
|
|
$ 14.4
|
Company restaurant
expenses as a % of Company sales(1)
|
86.8 %
|
|
86.9 %
|
|
(0.1) %
|
|
85.1 %
|
|
86.9 %
|
|
(1.8) %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$ 88.3
|
|
$ 73.2
|
|
$ 15.1
|
|
$ 12.2
|
|
$
7.6
|
|
$
4.6
|
Operating income as a %
of Total revenues
|
9.2 %
|
|
8.3 %
|
|
0.9 %
|
|
10.2 %
|
|
7.5 %
|
|
2.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Restaurant operating
margin - non-GAAP(1)(3)
|
$ 125.8
|
|
$ 114.4
|
|
$ 11.4
|
|
$ 17.8
|
|
$ 13.2
|
|
$
4.6
|
Restaurant operating
margin as a % of Company sales -
non-GAAP(1)(3)
|
13.2 %
|
|
13.1 %
|
|
0.1 %
|
|
14.9 %
|
|
13.1 %
|
|
1.8 %
|
|
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section above for more details.
|
(2)
|
Company restaurant
expenses includes Food and beverage costs, Restaurant labor
and Restaurant expenses, and excludes Depreciation and
amortization, General and administrative and Other (gains) and
charges.
|
(3)
|
See Non-GAAP
Information and Reconciliations section below for more
details.
|
Chili's
- Chili's Company sales increased primarily due to increased menu
pricing, favorable menu item mix, and higher dine-in traffic,
partially offset by lower off-premise traffic.
- Chili's Company restaurant expenses, as a percentage of Company
sales, decreased slightly primarily due to sales leverage, offset
by commodity price inflation, higher hourly labor expenses due to
an increase in hourly wage rates and staffing levels, advertising,
manager salaries and bonus, repair and maintenance expenses,
utilities, and rent expense.
- Chili's franchisees generated sales of approximately
$213.6 million for the third quarter
of fiscal 2023 compared to $190.4
million for the third quarter of fiscal 2022.
Maggiano's
- Maggiano's Company sales increased primarily due to higher
dining room and banquet traffic, increased menu pricing and
favorable menu item mix.
- Maggiano's Company restaurant expenses, as a percentage of
Company sales, decreased primarily due to sales leverage. The
decreases were partially offset by higher hourly labor due to an
increase in hourly wage rates and staffing levels, commodity price
inflation, manager salaries, repair and maintenance expenses,
delivery expenses, property taxes, and utilities.
Income Taxes
- On a GAAP basis, the effective income tax rate was a benefit of
0.2% in the third quarter of fiscal 2023. The effective income tax
rate is lower than the statutory rate of 21% due primarily to
leverage of the FICA tip credit and the impact of aligning fiscal
2023 year-to-date tax expense with the current estimated annual tax
rate. Excluding the impact of special items, the effective income
tax rate was an expense of 2.5% in the third quarter of fiscal
2023.
Webcast Information
Investors and interested parties are invited to listen to
today's conference call, as management will provide further details
of the quarter and business updates. The call will be broadcast
live on Brinker's website today, May 3, 2023 at
9 a.m. CDT:
http://investors.brinker.com/events/event-details/q3-2023-brinker-international-earnings-conference-call
For those who are unable to listen to the live broadcast, a
replay of the call will be available shortly thereafter and will
remain on Brinker's website until at least the end of the day
May 17, 2023.
Additional financial information, including statements of income
which detail operations excluding special items, franchise
revenues, and comparable restaurant sales trends by brand, is also
available on Brinker's website under the Financial Information
section of the Investor tab.
Forward Calendar
- SEC Form 10-Q for the third quarter of fiscal 2023 filing on or
before May 8, 2023
- Earnings release call for the fourth quarter of fiscal 2023 on
August 16, 2023
Non-GAAP Measures
Brinker management uses certain non-GAAP measures in analyzing
operating performance and believes that the presentation of these
measures in this release provides investors with information that
is beneficial to gaining an understanding of the Company's
financial results. Non-GAAP disclosures should not be viewed as a
substitute for financial results determined in accordance with
GAAP, nor are they necessarily comparable to non-GAAP performance
measures that may be presented by other companies. Reconciliations
of these non-GAAP measures are included in the tables below.
About Brinker
Brinker International, Inc. is one of the world's leading
casual dining restaurant companies and home of Chili's®
Grill & Bar, Maggiano's Little Italy® and the It's
Just Wings® virtual
brand: Founded in 1975 in Dallas,
Texas, we've ventured far from home, but stayed true to our
roots. Brinker owns, operates or franchises more than 1,600
restaurants in 29 countries and two U.S. territories. Our passion
is making people feel special, and we hope you feel that passion
each time you visit one of our restaurants or invite us into your
home through takeout or delivery. Learn more about Brinker and its
brands at brinker.com.
Forward-Looking Statements
The statements and tables contained in this release that are not
historical facts are forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. We intend all forward-looking
statements to be covered by the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. All
forward-looking statements are made only based on our current plans
and expectations as of the date such statements are made, and we
undertake no obligation to update forward-looking statements to
reflect events or circumstances arising after the date such
statements are made. Forward-looking statements are neither
predictions nor guarantees of future events or performance and are
subject to risks and uncertainties which could cause actual results
to differ materially from our historical results or from those
projected in forward-looking statements. Such risks and
uncertainties include, among other things, the impact of general
economic conditions, including inflation, on economic activity and
on our operations; the impact of the COVID-19 pandemic; the crisis
in Ukraine and related disruptions
on our business including consumer demand, costs, product mix, our
strategic initiatives, our partners' supply chains, operations,
technology and assets, and our financial performance; the impact of
competition; changes in consumer preferences; consumer perception
of food safety; reduced consumer discretionary spending;
unfavorable publicity; governmental regulations; the Company's
ability to meet its business strategy plan; loss of key management
personnel; failure to hire and retain high-quality restaurant
management and team members; the impact of social media or other
unfavorable publicity; reliance on technology and third party
delivery providers; failure to protect the security of data of our
guests and team members; product availability and supply chain
disruptions; regional business and economic conditions; volatility
in consumer, commodity, transportation, labor, currency and capital
markets; litigation; franchisee success; technology failures;
failure to protect our intellectual property; outsourcing;
impairment of goodwill or assets; failure to maintain effective
internal control over financial reporting; downgrades in credit
ratings; changes in estimates regarding our assets; actions of
activist shareholders; failure to comply with new environmental,
social and governance (ESG) requirements; failure to achieve any
goals, targets or objectives with respect to ESG matters; adverse
weather conditions; terrorist acts; health epidemics or pandemics
(such as COVID-19); tax reform; inadequate insurance coverage and
limitations imposed by our credit agreements as well as the risks
and uncertainties described in "Risk Factors" in our Annual Report
on Form 10-K and future filings with the Securities and Exchange
Commission.
BRINKER
INTERNATIONAL, INC.
Consolidated
Statements of Comprehensive Income (Loss)
(Unaudited)
(In millions, except
per share amounts)
|
|
|
Thirteen Week
Periods Ended
|
|
Thirty-Nine Week
Periods Ended
|
|
March 29,
2023
|
|
March 30,
2022
|
|
March 29,
2023
|
|
March 30,
2022
|
Revenues
|
|
|
|
|
|
|
|
Company
sales(1)
|
$
1,072.9
|
|
$
970.9
|
|
$
3,028.4
|
|
$
2,752.3
|
Franchise
revenues(1)
|
10.3
|
|
9.5
|
|
29.3
|
|
30.3
|
Total
revenues
|
1,083.2
|
|
980.4
|
|
3,057.7
|
|
2,782.6
|
Operating costs and
expenses
|
|
|
|
|
|
|
|
Food and beverage
costs
|
287.5
|
|
270.3
|
|
866.4
|
|
757.4
|
Restaurant
labor
|
361.2
|
|
329.1
|
|
1,026.4
|
|
949.4
|
Restaurant
expenses
|
280.9
|
|
244.1
|
|
818.1
|
|
712.1
|
Depreciation and
amortization
|
42.5
|
|
42.2
|
|
126.2
|
|
123.1
|
General and
administrative
|
40.6
|
|
39.2
|
|
115.7
|
|
108.8
|
Other (gains) and
charges(2)
|
6.3
|
|
6.1
|
|
19.8
|
|
17.0
|
Total operating costs
and expenses
|
1,019.0
|
|
931.0
|
|
2,972.6
|
|
2,667.8
|
Operating
income
|
64.2
|
|
49.4
|
|
85.1
|
|
114.8
|
Interest
expenses
|
14.2
|
|
11.1
|
|
40.4
|
|
34.8
|
Other income,
net
|
(0.6)
|
|
(0.4)
|
|
(1.3)
|
|
(1.2)
|
Income before income
taxes
|
50.6
|
|
38.7
|
|
46.0
|
|
81.2
|
Provision (Benefit) for
income taxes
|
(0.1)
|
|
2.1
|
|
(2.4)
|
|
3.8
|
Net income
|
$
50.7
|
|
$
36.6
|
|
$
48.4
|
|
$
77.4
|
|
|
|
|
|
|
|
|
Basic net income per
share
|
$
1.15
|
|
$
0.82
|
|
$
1.10
|
|
$
1.71
|
|
|
|
|
|
|
|
|
Diluted net income per
share
|
$
1.12
|
|
$
0.81
|
|
$
1.08
|
|
$
1.68
|
|
|
|
|
|
|
|
|
Basic weighted average
shares outstanding
|
44.1
|
|
44.4
|
|
44.0
|
|
45.2
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
45.1
|
|
45.1
|
|
44.8
|
|
46.0
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments(3)
|
$
0.1
|
|
$
0.4
|
|
$
(0.8)
|
|
$
(0.1)
|
Other comprehensive
income (loss)
|
0.1
|
|
0.4
|
|
(0.8)
|
|
(0.1)
|
Comprehensive income
(loss)
|
$
50.8
|
|
$
37.0
|
|
$
47.6
|
|
$
77.3
|
|
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section above for more details.
|
(2)
|
Other (gains) and
charges included in the Consolidated Statements of Comprehensive
Income (Unaudited) included (in millions):
|
|
|
|
Thirteen Week
Periods Ended
|
|
Thirty-Nine Week
Periods Ended
|
|
March 29,
2023
|
|
March 30,
2022
|
|
March 29,
2023
|
|
March 30,
2022
|
Lease
contingencies
|
$
2.0
|
|
$
—
|
|
$
2.0
|
|
$
2.9
|
Restaurant closure
charges
|
1.8
|
|
1.2
|
|
6.6
|
|
1.7
|
Enterprise system
implementation costs
|
1.3
|
|
0.5
|
|
3.3
|
|
1.4
|
Severance and other
benefit charges
|
1.0
|
|
—
|
|
3.9
|
|
—
|
Remodel-related
costs
|
0.1
|
|
0.9
|
|
1.1
|
|
4.0
|
Acquisition-related
costs, net
|
—
|
|
0.6
|
|
0.2
|
|
1.5
|
Loss from natural
disasters, net of (insurance recoveries)
|
(0.1)
|
|
—
|
|
0.8
|
|
0.8
|
Other
|
0.2
|
|
2.9
|
|
1.9
|
|
4.7
|
|
$
6.3
|
|
$
6.1
|
|
$
19.8
|
|
$
17.0
|
|
|
(3)
|
Represents the
unrealized impact of translating the financial statements of our
Canadian restaurants from Canadian dollars to U.S. dollars. This
amount is not included in Net income and would only be realized
upon disposition of these restaurants.
|
BRINKER
INTERNATIONAL, INC.
Condensed
Consolidated Balance Sheets (Unaudited)
(In
millions)
|
|
|
March 29,
2023
|
|
June 29,
2022
|
ASSETS
|
|
|
|
Total current
assets
|
$
213.4
|
|
$
201.2
|
Net property and
equipment
|
819.8
|
|
816.7
|
Operating lease
assets
|
1,124.9
|
|
1,160.5
|
Deferred income taxes,
net
|
81.3
|
|
62.5
|
Other
assets
|
238.7
|
|
243.5
|
Total
assets
|
$
2,478.1
|
|
$
2,484.4
|
LIABILITIES AND
SHAREHOLDERS' DEFICIT
|
|
|
|
Total current
liabilities
|
$
585.7
|
|
$
558.0
|
Long-term debt and
finance leases, less current installments
|
930.7
|
|
989.1
|
Long-term operating
lease liabilities, less current portion
|
1,113.8
|
|
1,151.1
|
Other
liabilities
|
58.2
|
|
54.3
|
Total shareholders'
deficit
|
(210.3)
|
|
(268.1)
|
Total liabilities and
shareholders' deficit
|
$
2,478.1
|
|
$
2,484.4
|
BRINKER
INTERNATIONAL, INC.
Condensed
Consolidated Statements of Cash Flows (Unaudited)
(In
millions)
|
|
|
Thirty-Nine Week
Periods Ended
|
|
March 29,
2023
|
|
March 30,
2022
|
Cash flows from
operating activities
|
|
|
|
Net (loss)
income
|
$
48.4
|
|
$
77.4
|
Adjustments to
reconcile Net income to Net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
126.2
|
|
123.1
|
Stock-based
compensation
|
10.3
|
|
15.2
|
Restructure and
impairment charges
|
12.2
|
|
8.7
|
Net loss on disposal
of assets
|
2.9
|
|
2.3
|
Other
|
1.3
|
|
2.6
|
Changes in assets and
liabilities
|
(0.5)
|
|
(17.7)
|
Net cash provided by
operating activities
|
200.8
|
|
211.6
|
Cash flows from
investing activities
|
|
|
|
Payments for property
and equipment
|
(136.6)
|
|
(109.0)
|
Proceeds from note
receivable
|
3.3
|
|
1.0
|
Payments for franchise
restaurant acquisitions
|
—
|
|
(106.0)
|
Proceeds from sale
leaseback transactions, net of related expenses
|
—
|
|
20.5
|
Proceeds from sale of
assets
|
—
|
|
0.1
|
Net cash used in
investing activities
|
(133.3)
|
|
(193.4)
|
Cash flows from
financing activities
|
|
|
|
Borrowings on
revolving credit facility
|
375.0
|
|
595.5
|
Payments on revolving
credit facility
|
(425.0)
|
|
(502.5)
|
Payments on long-term
debt
|
(16.7)
|
|
(17.6)
|
Purchases of treasury
stock
|
(2.2)
|
|
(100.8)
|
Payments of
dividends
|
(0.4)
|
|
(1.1)
|
Proceeds from issuance
of treasury stock
|
2.1
|
|
0.4
|
Payments for debt
issuance costs
|
—
|
|
(3.1)
|
Net cash used in
financing activities
|
(67.2)
|
|
(29.2)
|
Net change in cash and
cash equivalents
|
0.3
|
|
(11.0)
|
Cash and cash
equivalents at beginning of period
|
13.5
|
|
23.9
|
Cash and cash
equivalents at end of period
|
$
13.8
|
|
$
12.9
|
BRINKER
INTERNATIONAL, INC.
Restaurant
Summary
|
|
|
|
|
|
|
Fiscal 2023 New
Openings (1)
|
|
Total
Restaurants
Open at
March 29, 2023
|
|
Total
Restaurants
Open at
March 30, 2022
|
|
Third Quarter
Openings
|
|
Fiscal Year
Openings
|
|
Full Year
Projected
Openings
|
Company-owned
restaurants
|
|
|
|
|
|
|
|
|
|
Chili's
domestic
|
1,129
|
|
1,130
|
|
3
|
|
7
|
|
14
|
Chili's
international
|
5
|
|
5
|
|
—
|
|
—
|
|
—
|
Maggiano's
domestic
|
50
|
|
52
|
|
—
|
|
—
|
|
—
|
Total
Company-owned
|
1,184
|
|
1,187
|
|
3
|
|
7
|
|
14
|
Franchise
restaurants
|
|
|
|
|
|
|
|
|
|
Chili's
domestic
|
102
|
|
103
|
|
1
|
|
2
|
|
1
|
Chili's
international
|
366
|
|
358
|
|
6
|
|
14
|
|
16-20
|
Maggiano's
domestic
|
2
|
|
2
|
|
—
|
|
—
|
|
—
|
Total
franchise
|
470
|
|
463
|
|
7
|
|
16
|
|
17-21
|
Total Company-owned and
franchise
|
|
|
|
|
|
|
|
|
|
Chili's
domestic
|
1,231
|
|
1,233
|
|
4
|
|
9
|
|
15
|
Chili's
international
|
371
|
|
363
|
|
6
|
|
14
|
|
16-20
|
Maggiano's
domestic
|
52
|
|
54
|
|
—
|
|
—
|
|
—
|
Total
|
1,654
|
|
1,650
|
|
10
|
|
23
|
|
31-35
|
|
|
(1)
|
Chili's domestic
company-owned restaurants openings count excludes one relocation
during the second quarter of fiscal 2023.
|
NON-GAAP INFORMATION
AND RECONCILIATIONS
Comparable
Restaurant Sales
Q3
23 and Q3 22
|
|
|
Comparable
Restaurant
Sales(1)
|
|
Price
Impact
|
|
Mix-Shift(2)
|
|
Traffic
|
|
Q3:23 vs
22
|
|
Q3:22 vs
21
|
|
Q3:23 vs
22
|
|
Q3:22 vs
21
|
|
Q3:23 vs
22
|
|
Q3:22 vs
21
|
|
Q3:23 vs
22
|
|
Q3:22 vs
21
|
Company-owned
|
10.8 %
|
|
13.5 %
|
|
9.6 %
|
|
4.3 %
|
|
5.3 %
|
|
5.7 %
|
|
(4.1) %
|
|
3.5 %
|
Chili's
|
9.6 %
|
|
10.3 %
|
|
9.8 %
|
|
4.3 %
|
|
5.6 %
|
|
3.9 %
|
|
(5.8) %
|
|
2.1 %
|
Maggiano's
|
21.6 %
|
|
50.5 %
|
|
8.3 %
|
|
4.8 %
|
|
3.8 %
|
|
16.8 %
|
|
9.5 %
|
|
28.9 %
|
Franchise(3)
|
9.9 %
|
|
20.3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
|
5.6 %
|
|
9.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
12.5 %
|
|
28.4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Chili's
domestic(4)
|
9.1 %
|
|
9.9 %
|
|
|
|
|
|
|
|
|
|
|
|
|
System-wide(5)
|
10.7 %
|
|
14.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Comparable Restaurant
Sales include all restaurants that have been in operation for more
than 18 full months. Restaurants temporarily closed 14 days or more
are excluded from Comparable Restaurant Sales. Percentage amounts
are calculated based on the comparable periods
year-over-year.
|
(2)
|
Mix-Shift is calculated
as the year-over-year percentage change in Company sales resulting
from the change in menu items ordered by guests.
|
(3)
|
Chili's and Maggiano's
franchise sales generated by franchisees are not included in Total
revenues in the Consolidated Statements of Comprehensive Income
(Unaudited); however, we generate royalty revenues and advertising
fees based on franchisee revenues, where applicable. We believe
presenting Franchise Comparable Restaurant Sales provides investors
relevant information regarding total brand performance.
|
(4)
|
Chili's domestic
Comparable Restaurant Sales percentages are derived from sales
generated by Company-owned and franchise-operated Chili's
restaurants in the United States.
|
(5)
|
System-wide Comparable
Restaurant Sales are derived from sales generated by Chili's and
Maggiano's Company-owned and franchise-operated
restaurants.
|
Reconciliation of Net Income Excluding Special Items (in
millions, except per share amounts)
Brinker believes excluding special items from its financial
results provides investors with a clearer perspective of the
Company's ongoing operating performance and a more relevant
comparison to prior period results.
|
Third
Quarter
|
|
Q3 23
|
|
EPS Q3
23
|
|
Q3 22
|
|
EPS Q3
22
|
Net income -
GAAP
|
$
50.7
|
|
$
1.12
|
|
$
36.6
|
|
$
0.81
|
Special items - Other
(gains) and charges(1)
|
6.3
|
|
0.14
|
|
6.1
|
|
0.13
|
Special items -
Depreciation
|
0.1
|
|
—
|
|
0.1
|
|
—
|
Income tax effect
related to special items(2)
|
(1.6)
|
|
(0.03)
|
|
(1.5)
|
|
(0.02)
|
Special items, net of
taxes
|
4.8
|
|
0.11
|
|
4.7
|
|
0.11
|
Adjustment for special
tax items
|
0.0
|
|
0.00
|
|
0.1
|
|
—
|
Net income, excluding
special items - Non-GAAP
|
$
55.5
|
|
$
1.23
|
|
$
41.4
|
|
$
0.92
|
|
|
(1)
|
See Footnote "(2)" to
the Consolidated Statements of Comprehensive (Loss) Income
(Unaudited) for additional details on the composition of Other
(gains) and charges.
|
(2)
|
Income tax effect
related to special items is based on the statutory tax rate in
effect at the end of each period presented.
|
Reconciliation of
Restaurant Operating Margin (in millions, except
percentages)
|
|
|
Chili's
|
|
Maggiano's
|
|
Brinker
|
|
Q3 23
|
|
Q3 22
|
|
Q3 23
|
|
Q3 22
|
|
Q3 23
|
|
Q3 22
|
Operating income -
GAAP
|
$
88.3
|
|
$
73.2
|
|
$
12.2
|
|
$ 7.6
|
|
$
64.2
|
|
$
49.4
|
Operating income as a
percentage of Total revenues
|
9.2 %
|
|
8.3 %
|
|
10.2 %
|
|
7.5 %
|
|
5.9 %
|
|
5.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income -
GAAP
|
$
88.3
|
|
$
73.2
|
|
$
12.2
|
|
$ 7.6
|
|
$
64.2
|
|
$
49.4
|
Less: Franchise
revenues(1)
|
(10.2)
|
|
(9.4)
|
|
(0.1)
|
|
(0.1)
|
|
(10.3)
|
|
(9.5)
|
Plus:
Depreciation and amortization
|
36.7
|
|
35.9
|
|
3.3
|
|
3.4
|
|
42.5
|
|
42.2
|
General and
administrative
|
8.8
|
|
9.5
|
|
2.0
|
|
2.3
|
|
40.6
|
|
39.2
|
Other (gains) and
charges
|
2.2
|
|
5.2
|
|
0.4
|
|
—
|
|
6.3
|
|
6.1
|
Restaurant operating
margin - non-GAAP(1)
|
$ 125.8
|
|
$ 114.4
|
|
$
17.8
|
|
$
13.2
|
|
$ 143.3
|
|
$ 127.4
|
Restaurant operating
margin as a percentage of Company sales(1)
|
13.2 %
|
|
13.1 %
|
|
14.9 %
|
|
13.1 %
|
|
13.4 %
|
|
13.1 %
|
|
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section above for more details.
|
Restaurant operating margin is not a measurement determined in
accordance with GAAP and should not be considered in isolation, or
as an alternative to operating income as an indicator of financial
performance. Restaurant operating margin is widely regarded in the
restaurant industry as a useful metric by which to evaluate
restaurant-level operating efficiency and performance of ongoing
restaurant-level operations. This non-GAAP measure is not
indicative of overall Company performance and profitability because
this measure does not directly accrue benefit to the shareholders
due to the nature of costs excluded.
We define Restaurant operating margin as Company sales less Food
and beverage costs, Restaurant labor and Restaurant expenses. We
believe this metric provides a more useful comparison between
periods and enables investors to focus on the performance of
restaurant-level operations by excluding revenues not related to
food and beverage sales at Company-owned restaurants, corporate
General and administrative expenses, Depreciation and amortization,
and Other (gains) and charges. Restaurant operating margin as
presented may not be comparable to other similarly titled measures
of other companies in our industry.
Reconciliation of Adjusted EBITDA (in millions)
Adjusted EBITDA is not a measurement determined in accordance
with GAAP and should not be considered in isolation, or as an
alternative to net income as an indicator of financial performance.
Brinker believes presenting Adjusted EBITDA provides a useful
measure of our operating performance, excluding the impacts of
financing costs, capital expenditures and special items. We define
Adjusted EBITDA as Net income before (Benefit) Provision for income
taxes, Other income, net, Interest expenses, Depreciation and
amortization and Other (gains) and charges.
|
Third
Quarter
|
|
Q3 23
|
|
Q3 22
|
Net income -
GAAP
|
$
50.7
|
|
$
36.6
|
Provision
(Benefit) for income taxes
|
(0.1)
|
|
2.1
|
Other income,
net
|
(0.6)
|
|
(0.4)
|
Interest
expenses
|
14.2
|
|
11.1
|
Depreciation and
amortization
|
42.5
|
|
42.2
|
Other (gains) and
charges
|
6.3
|
|
6.1
|
Adjusted
EBITDA
|
$
113.0
|
|
$
97.7
|
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SOURCE Brinker International Payroll Company, L.P.