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Acquisitions | 6 Months Ended
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Jun. 25, 2023
Business Combination and Asset Acquisition [Abstract] |
Acquisitions | 12. Acquisitions UK Franchisee Acquisition On June 2, 2023 (the “Acquisition Date”), the Company acquired 91 Papa Johns restaurants previously operated by the M25 division of Drake Food Service International in the United Kingdom (referred to as “DFSI”), the Company's largest franchisee, for total consideration of approximately $13.7 million. The acquisition establishes a portfolio of Company-owned restaurants in the UK market and enables the Company to implement operating model enhancements in the restaurants including revenue management capabilities, product and technological innovation and operational efficiencies to improve sales and restaurant-level profitability. The acquisition represents a part of the Company’s investments to reposition our UK portfolio and drive initiatives for future growth and profitability in the Company’s largest market outside of North America. During the three months ended June 25, 2023, the Company incurred $1.3 million of acquisition-related costs, which were recorded within General and administrative expenses and within the International segment in the Condensed Consolidated Statements of Operations. The results of DFSI’s operations after the Acquisition Date are included in the Company’s Condensed Consolidated Statements of Operations. The revenues and income before income taxes were recorded within the International segment and were not material to the Company’s Condensed Consolidated Statements of Operations during the three months ended June 25, 2023. Preliminary Acquisition Accounting The DFSI acquisition has been accounted for as a business combination. As such, the Company concluded that the consideration was measured at fair value and has recorded the preliminary estimated fair value of the assets acquired and liabilities assumed as of the Acquisition Date. Total consideration was approximately $13.7 million, substantially all of which was pre-existing accounts receivable and notes receivable and was classified as a noncash investing transaction within the Condensed Consolidated Statements of Cash Flows during the six months ended June 25, 2023. Assets acquired include approximately $9.1 million of property and equipment, net, $0.3 million of inventories and other assets and $4.3 million of goodwill. The total goodwill recognized in conjunction with the DFSI acquisition, all of which is expected to be deductible for tax purposes, has been assigned to the International operating segment. The purchase price exceeded the fair value of the net assets acquired, which resulted in the recognition of goodwill, primarily due to synergies created from expected future benefits stemming from implementation of the Company’s operational capabilities and further control of the Company’s brand name in our most prominent international market. Goodwill also includes certain other benefits that do not qualify for recognition as intangible assets, such as an assembled workforce. The amounts recorded as a result of our preliminary acquisition accounting are subject to change and further refinement. The Company is still finalizing certain working capital adjustments with the sellers, assessing the condition and finalizing the fair value of acquired property and equipment, and gathering information regarding leases and other assets. The Company expects these items to be finalized prior to the one-year anniversary date of the acquisition. The following summarizes changes in the Company’s goodwill by reportable segment (in thousands):
|  | Domestic Company-owned restaurants |  | International |  | All others |  | Total
Balance at December 25, 2022 |  | $ | 55,507 |  |  | $ | 14,673 |  |  | $ | 436 |  |  | $ | 70,616 |
Acquisitions (a) |  | 1,102 |  |  | 4,274 |  |  | — |  |  | 5,376 |
Foreign currency adjustments |  | — |  |  | 631 |  |  | — |  |  | 631 |
Balance at June 25, 2023 |  | $ | 56,609 |  |  | $ | 19,578 |  |  | $ | 436 |  |  | $ | 76,623 |
(s) Goodwill from acquisitions during the six months ended June 25, 2023 include $4.3 million from the DFSI acquisition described above as well as $1.1 million related to a Domestic store acquisition. The Domestic acquisition was classified as a noncash investing transaction within the Condensed Consolidated Statements of Cash Flows during the six months ended June 25, 2023.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//805/tableOfContent + Details
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