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Adoption of ASU 2014-09, "Revenue from Contracts with Customers" (Tables) | 3 Months Ended
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Apr. 01, 2018
Adoption of ASU 2014-09, "Revenue from Contracts with Customers" |
Schedule of impacts of adoption of ASU 2014-09 | The following chart presents the specific line items impacted by the cumulative adjustment.
|  |  |  |  |  |  |  | Adjusted
|  | As Reported |  |  |  |  |  | Balance Sheet
|  | December 31, |  |  | Total |  |  | at January 1,
(In thousands, except per share amounts) |  | 2017 |  |  | Adjustments |  |  | 2018
Assets |  |  |  |  |  |  |  |  |
Current assets: |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 22,345 |  | $ | 4,279 |  | $ | 26,624
Accounts receivable, net |  |  | 64,644 |  |  | 493 |  |  | 65,137
Notes receivable, net |  |  | 4,333 |  |  | — |  |  | 4,333
Income tax receivable |  |  | 3,903 |  |  | — |  |  | 3,903
Inventories |  |  | 30,620 |  |  | — |  |  | 30,620
Prepaid expenses |  |  | 28,522 |  |  | (4,959) |  |  | 23,563
Other current assets |  |  | 9,494 |  |  | — |  |  | 9,494
Assets held for sale |  |  | 6,133 |  |  | — |  |  | 6,133
Total current assets |  |  | 169,994 |  |  | (187) |  |  | 169,807
Property and equipment, net |  |  | 234,331 |  |  | — |  |  | 234,331
Notes receivable, less current portion, net |  |  | 15,568 |  |  | — |  |  | 15,568
Goodwill |  |  | 86,892 |  |  | — |  |  | 86,892
Deferred income taxes, net |  |  | 585 |  |  | — |  |  | 585
Other assets |  |  | 48,183 |  |  | (907) |  |  | 47,276
Total assets |  | $ | 555,553 |  | $ | (1,094) |  | $ | 554,459
Liabilities and stockholders’ equity (deficit) |  |  |  |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |  |  |  |
Accounts payable |  | $ | 32,006 |  | $ | (2,161) |  | $ | 29,845
Income and other taxes payable |  |  | 10,561 |  |  | — |  |  | 10,561
Accrued expenses and other current liabilities |  |  | 70,293 |  |  | 15,860 |  |  | 86,153
Deferred revenue current |  |  | — |  |  | 2,400 |  |  | 2,400
Current portion of long-term debt |  |  | 20,000 |  |  | — |  |  | 20,000
Total current liabilities |  |  | 132,860 |  |  | 16,099 |  |  | 148,959
Deferred revenue |  |  | 2,652 |  |  | 10,798 |  |  | 13,450
Long-term debt, less current portion, net |  |  | 446,565 |  |  | — |  |  | 446,565
Deferred income taxes, net |  |  | 12,546 |  |  | (6,464) |  |  | 6,082
Other long-term liabilities |  |  | 60,146 |  |  | — |  |  | 60,146
Total liabilities |  |  | 654,769 |  |  | 20,433 |  |  | 675,202
Redeemable noncontrolling interests |  |  | 6,738 |  |  | — |  |  | 6,738
Stockholders’ equity (deficit): |  |  |  |  |  |  |  |  |
Preferred stock ($0.01 par value per share; no shares issued) |  |  | — |  |  | — |  |  | —
Common stock ($0.01 par value per share; issued 44,221 at December 31, 2017 |  |  | 442 |  |  | — |  |  | 442
Additional paid-in capital |  |  | 184,785 |  |  | — |  |  | 184,785
Accumulated other comprehensive loss |  |  | (2,117) |  |  | — |  |  | (2,117)
Retained earnings |  |  | 292,251 |  |  | (21,527) |  |  | 270,724
Treasury stock (10,290 shares at December 31, 2017, at cost) |  |  | (597,072) |  |  | — |  |  | (597,072)
Total stockholders’ equity (deficit), net of noncontrolling interests |  |  | (121,711) |  |  | (21,527) |  |  | (143,238)
Noncontrolling interests in subsidiaries |  |  | 15,757 |  |  | — |  |  | 15,757
Total stockholders’ equity (deficit) |  |  | (105,954) |  |  | (21,527) |  |  | (127,481)
Total liabilities, redeemable noncontrolling interests and stockholders’ equity (deficit) |  | $ | 555,553 |  | $ | (1,094) |  | $ | 554,459
The impact of adoption for the first quarter of 2018 is as follows:
|  | As Reported |  |  |  |  |  | Balance Sheet
|  | April 1, |  |  | Total |  |  | Without Adoption
(In thousands, except per share amounts) |  | 2018 |  |  | Adjustments |  |  | of Topic 606
Assets |  |  |  |  |  |  |  |  |
Current assets: |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 31,935 |  | $ | (3,422) |  | $ | 28,513
Accounts receivable, net |  |  | 62,949 |  |  | (376) |  |  | 62,573
Notes receivable, net |  |  | 4,662 |  |  | — |  |  | 4,662
Income tax receivable |  |  | — |  |  | — |  |  | —
Inventories |  |  | 28,285 |  |  | — |  |  | 28,285
Prepaid expenses |  |  | 27,990 |  |  | 4,398 |  |  | 32,388
Other current assets |  |  | 17,529 |  |  | — |  |  | 17,529
Assets held for sale |  |  | 5,900 |  |  | — |  |  | 5,900
Total current assets |  |  | 179,250 |  |  | 600 |  |  | 179,850
Property and equipment, net |  |  | 229,576 |  |  | — |  |  | 229,576
Notes receivable, less current portion, net |  |  | 16,084 |  |  | — |  |  | 16,084
Goodwill |  |  | 86,746 |  |  | — |  |  | 86,746
Deferred income taxes, net |  |  | 614 |  |  | — |  |  | 614
Other assets |  |  | 67,547 |  |  | 907 |  |  | 68,454
Total assets |  | $ | 579,817 |  | $ | 1,507 |  | $ | 581,324
Liabilities and stockholders’ equity (deficit) |  |  |  |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |  |  |  |
Accounts payable |  | $ | 31,072 |  | $ | 1,237 |  | $ | 32,309
Income and other taxes payable |  |  | 10,094 |  |  | — |  |  | 10,094
Accrued expenses and other current liabilities |  |  | 92,890 |  |  | (14,854) |  |  | 78,036
Deferred revenue current |  |  | 2,400 |  |  | (2,400) |  |  | —
Current portion of long-term debt |  |  | 20,000 |  |  | — |  |  | 20,000
Total current liabilities |  |  | 156,456 |  |  | (16,017) |  |  | 140,439
Deferred revenue |  |  | 13,671 |  |  | (11,027) |  |  | 2,644
Long-term debt, less current portion, net |  |  | 568,770 |  |  | — |  |  | 568,770
Deferred income taxes, net |  |  | 6,125 |  |  | 6,593 |  |  | 12,718
Other long-term liabilities |  |  | 76,993 |  |  | — |  |  | 76,993
Total liabilities |  |  | 822,015 |  |  | (20,451) |  |  | 801,564
Redeemable noncontrolling interests |  |  | 7,037 |  |  | — |  |  | 7,037
Stockholders’ equity (deficit): |  |  |  |  |  |  |  |  |
Preferred stock ($0.01 par value per share; no shares issued) |  |  | — |  |  | — |  |  | —
Common stock ($0.01 par value per share; issued 44,268 at April 1, 2018) |  |  | 443 |  |  | — |  |  | 443
Additional paid-in capital |  |  | 163,198 |  |  | — |  |  | 163,198
Accumulated other comprehensive income (loss) |  |  | 4,110 |  |  | — |  |  | 4,110
Retained earnings |  |  | 280,853 |  |  | 21,958 |  |  | 302,811
Treasury stock (12,245 shares at April 1, 2018, at cost) |  |  | (714,097) |  |  | — |  |  | (714,097)
Total stockholders’ equity (deficit), net of noncontrolling interests |  |  | (265,493) |  |  | 21,958 |  |  | (243,535)
Noncontrolling interests in subsidiaries |  |  | 16,258 |  |  | — |  |  | 16,258
Total stockholders’ equity (deficit) |  |  | (249,235) |  |  | 21,958 |  |  | (227,277)
Total liabilities, redeemable noncontrolling interests and stockholders’ equity (deficit) |  | $ | 579,817 |  | $ | 1,507 |  | $ | 581,324
|  | As Reported |  |  |  |  |
|  | Three Months Ended |  |  |  |  | Income Statement
|  | April 1, |  | Total |  | Without Adoption of
(In thousands, except per share amounts) |  | 2018 |  | Adjustments |  | Topic 606
Revenues: |  |  |  |  |  |  |  |  |
Domestic Company-owned restaurant sales |  | $ | 190,242 |  | $ | 264 |  | $ | 190,506
North America franchise royalties and fees |  |  | 24,806 |  |  | 38 |  |  | 24,844
North America commissary |  |  | 161,713 |  |  | — |  |  | 161,713
International |  |  | 30,114 |  |  | 149 |  |  | 30,263
Other revenues |  |  | 20,494 |  |  | (2,887) |  |  | 17,607
Total revenues |  |  | 427,369 |  |  | (2,436) |  |  | 424,933
Costs and expenses: |  |  |  |  |  |  |  |  |
Operating costs (excluding depreciation and amortization shown separately below): |  |  |  |  |  |  |  |  |
Domestic Company-owned restaurant expenses |  |  | 157,319 |  |  | (66) |  |  | 157,253
North America commissary |  |  | 151,681 |  |  | — |  |  | 151,681
International expenses |  |  | 19,030 |  |  | — |  |  | 19,030
Other expenses |  |  | 20,958 |  |  | (3,359) |  |  | 17,599
General and administrative expenses |  |  | 39,729 |  |  | 504 |  |  | 40,233
Depreciation and amortization |  |  | 11,539 |  |  | — |  |  | 11,539
Total costs and expenses |  |  | 400,256 |  |  | (2,921) |  |  | 397,335
Refranchising and impairment gains/(losses), net |  |  | 204 |  |  | — |  |  | 204
Operating income |  |  | 27,317 |  |  | 485 |  |  | 27,802
Net Interest expense |  |  | (4,955) |  |  | — |  |  | (4,955)
Income before income taxes |  |  | 22,362 |  |  | 485 |  |  | 22,847
Income tax expense |  |  | 4,982 |  |  | 112 |  |  | 5,094
Net income before attribution to noncontrolling interests |  |  | 17,380 |  |  | 373 |  |  | 17,753
Income attributable to noncontrolling interests |  |  | (643) |  |  | — |  |  | (643)
Net income attributable to the Company |  | $ | 16,737 |  | $ | 373 |  | $ | 17,110
Calculation of income for earnings per share: |  |  |  |  |  |  |  |  |
Net income attributable to the Company |  | $ | 16,737 |  | $ | 373 |  | $ | 17,110
Change in noncontrolling interest redemption value |  |  | — |  |  | — |  |  | —
Net income attributable to participating securities |  |  | (75) |  |  | — |  |  | (75)
Net income attributable to common shareholders |  | $ | 16,662 |  | $ | 373 |  | $ | 17,035
Basic earnings per common share |  | $ | 0.50 |  | $ | 0.01 |  | $ | 0.51
Diluted earnings per common share |  | $ | 0.50 |  | $ | 0.01 |  | $ | 0.51
Basic weighted average common shares outstanding |  |  | 33,279 |  |  | 33,279 |  |  | 33,279
Diluted weighted average common shares outstanding |  |  | 33,552 |  |  | 33,552 |  |  | 33,552
Schedule of estimated revenue expected to be recognized in the future | The following table (in thousands) includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied at the end of the reporting period.
|  |  | Performance Obligations by Period
|  | Less than 1 Year |  | 1-2 Years |  | 2-3 Years |  | 3-4 Years |  | 4-5 Years |  | Thereafter |  | Total
Franchise Fees |  | $ | 2,400 |  | $ | 2,141 |  | $ | 1,909 |  | $ | 1,681 |  | $ | 1,461 |  | $ | 3,835 |  | $ | 13,427

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