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v3.23.2

Segment Information (Tables) | 6 Months Ended
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Jun. 25, 2023
Segment Reporting [Abstract] |
Schedule of segment information | The following tables present our segment information.
|  | Three Months Ended |  | Six Months Ended
(In thousands) |  | June 25, 2023 |  | June 26, 2022 |  | June 25, 2023 |  | June 26, 2022
Revenues: |  |  |  |  |  |  |  |
Domestic Company-owned restaurants |  | $ | 175,780 |  | $ | 171,411 |  | $ | 355,646 |  | $ | 370,176
North America franchising |  | 34,711 |  | 34,917 |  | 70,783 |  | 69,185
North America commissaries |  | 206,980 |  | 219,383 |  | 419,546 |  | 429,062
International |  | 41,354 |  | 39,282 |  | 80,058 |  | 81,989
All others |  | 55,705 |  | 57,672 |  | 115,546 |  | 114,945
Total revenues |  | $ | 514,530 |  | $ | 522,665 |  | $ | 1,041,579 |  | $ | 1,065,357
Intersegment revenues: |  |  |  |  |  |  |  |
North America franchising |  | $ | 1,025 |  | $ | 1,048 |  | $ | 2,077 |  | $ | 2,101
North America commissaries |  | 51,586 |  | 52,754 |  | 103,403 |  | 111,261
International |  | 869 |  | — |  | 869 |  | —
All others |  | 16,348 |  | 15,889 |  | 33,183 |  | 35,268
Total intersegment revenues |  | $ | 69,828 |  | $ | 69,691 |  | $ | 139,532 |  | $ | 148,630
Operating income: |  |  |  |  |  |  |  |
Domestic Company-owned restaurants (a) |  | $ | 6,641 |  | $ | 5,924 |  | $ | 13,291 |  | $ | 7,912
North America franchising |  | 32,111 |  | 32,624 |  | 65,511 |  | 64,761
North America commissaries |  | 10,397 |  | 10,957 |  | 21,127 |  | 20,292
International (b) |  | 3,763 |  | 7,306 |  | 10,995 |  | 11,761
All others |  | 1,343 |  | 2,187 |  | 4,500 |  | 5,906
Unallocated corporate expenses (c) |  | (19,701) |  |  | (19,344) |  |  | (43,067) |  |  | (56,454) |
Elimination of intersegment (profits) losses |  | 358 |  |  | (750) |  | 351 |  |  | (839)
Total operating income |  | $ | 34,912 |  | $ | 38,904 |  | $ | 72,708 |  | $ | 53,339
Property and equipment, net: |  |  |  |  |  |  |  |
Domestic Company-owned restaurants |  | $ | 242,089 |  |  |  |  |  |
North America commissaries |  | 155,681 |  |  |  |  |  |
International |  | 27,748 |  |  |  |  |  |
All others |  | 139,114 |  |  |  |  |  |
Unallocated corporate assets |  | 248,387 |  |  |  |  |  |
Accumulated depreciation and amortization |  | (548,626) |  |  |  |  |  |  |
Total property and equipment, net |  | $ | 264,393 |  |  |  |  |  |
___________________________________ (a) The six months ended June 26, 2022 includes a one-time, non-cash charge of $8.4 million associated with the refranchising of the Company’s ownership interest in a 90-restaurant joint venture, recorded as Refranchising and impairment loss. See “Note 10. Divestitures” for additional information. (b) The three and six months ended June 25, 2023 includes $1.3 million of costs associated with repositioning the UK portfolio as well as transaction costs related to the acquisition of stores from franchisees. The six months ended June 26, 2022 includes $3.5 million of one-time, non-cash reserves for certain accounts receivable and impairments of reacquired franchise rights. See “Notes 2. Significant Accounting Policies” and “10. Divestitures” for additional information. (c) The three and six months ended June 25, 2023 includes $0.7 million and $2.0 million, respectively, of severance and related costs associated with the transition of certain executives. The three months ended June 26, 2022 includes $1.5 million of advisory fees and severance costs associated with the transition of certain executives. The six months ended June 26, 2022 includes $13.9 million of one-time, non-cash reserves of certain notes receivable, $5.0 million for certain legal settlements, and $1.5 million of advisory fees and severance costs associated with the transition of certain executives. See “Notes 2. Significant Accounting Policies” and “9. Litigation, Commitments and Contingencies” for additional information.
Schedule of revenue disaggregated by major product line | In the following tables, revenues are disaggregated by major product/service line. The tables also include a reconciliation of the disaggregated revenues by the reportable segment (in thousands):
|  | Reportable Segments
|  | Three Months Ended June 25, 2023
Major Products/Services Lines |  | Domestic Company-owned restaurants |  | North America franchising |  | North America commissaries |  | International |  | All others |  | Total
Company-owned restaurant sales |  | $ | 175,780 |  |  | $ | — |  |  | $ | — |  |  | $ | 3,018 |  |  | $ | — |  |  | $ | 178,798 |
Franchise royalties and fees |  | — |  |  | 35,736 |  |  | — |  |  | 12,196 |  |  | — |  |  | 47,932 |
Commissary sales |  | — |  |  | — |  |  | 258,566 |  |  | 20,263 |  |  | — |  |  | 278,829 |
Other revenues |  | — |  |  | — |  |  | — |  |  | 6,746 |  |  | 72,053 |  |  | 78,799 |
Eliminations |  | — |  |  | (1,025) |  |  | (51,586) |  |  | (869) |  |  | (16,348) |  |  | (69,828) |
Total segment revenues |  | 175,780 |  |  | 34,711 |  |  | 206,980 |  |  | 41,354 |  |  | 55,705 |  |  | 514,530 |
International other revenues (a) |  | — |  |  | — |  |  | — |  |  | (6,746) |  |  | 6,746 |  |  | — |
Total revenues |  | $ | 175,780 |  |  | $ | 34,711 |  |  | $ | 206,980 |  |  | $ | 34,608 |  |  | $ | 62,451 |  |  | $ | 514,530 |
|  | Reportable Segments
|  | Three Months Ended June 26, 2022
Major Products/Services Lines |  | Domestic Company-owned restaurants |  | North America franchising |  | North America commissaries |  | International |  | All others |  | Total
Company-owned restaurant sales |  | $ | 171,411 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 171,411 |
Franchise royalties and fees |  | — |  |  | 35,965 |  |  | — |  |  | 12,043 |  |  | — |  |  | 48,008 |
Commissary sales |  | — |  |  | — |  |  | 272,137 |  |  | 19,915 |  |  | — |  |  | 292,052 |
Other revenues |  | — |  |  | — |  |  | — |  |  | 7,324 |  |  | 73,561 |  |  | 80,885 |
Eliminations |  | — |  |  | (1,048) |  |  | (52,754) |  |  | — |  |  | (15,889) |  |  | (69,691) |
Total segment revenues |  | 171,411 |  |  | 34,917 |  |  | 219,383 |  |  | 39,282 |  |  | 57,672 |  |  | 522,665 |
International other revenues (a) |  | — |  |  | — |  |  | — |  |  | (7,324) |  |  | 7,324 |  |  | — |
Total revenues |  | $ | 171,411 |  |  | $ | 34,917 |  |  | $ | 219,383 |  |  | $ | 31,958 |  |  | $ | 64,996 |  |  | $ | 522,665 |
|  | Reportable Segments
|  | Six Months Ended June 25, 2023
Major Products/Services Lines |  | Domestic Company-owned restaurants |  | North America franchising |  | North America commissaries |  | International |  | All others |  | Total
Company-owned restaurant sales |  | $ | 355,646 |  |  | $ | — |  |  | $ | — |  |  | $ | 3,018 |  |  | $ | — |  |  | $ | 358,664 |
Franchise royalties and fees |  | — |  |  | 72,860 |  |  | — |  |  | 24,687 |  |  | — |  |  | 97,547 |
Commissary sales |  | — |  |  | — |  |  | 522,949 |  |  | 39,235 |  |  | — |  |  | 562,184 |
Other revenues |  | — |  |  | — |  |  | — |  |  | 13,987 |  |  | 148,729 |  |  | 162,716 |
Eliminations |  | — |  |  | (2,077) |  |  | (103,403) |  |  | (869) |  |  | (33,183) |  |  | (139,532) |
Total segment revenues |  | 355,646 |  |  | 70,783 |  |  | 419,546 |  |  | 80,058 |  |  | 115,546 |  |  | 1,041,579 |
International other revenues (a) |  | — |  |  | — |  |  | — |  |  | (13,987) |  |  | 13,987 |  |  | — |
Total revenues |  | $ | 355,646 |  |  | $ | 70,783 |  |  | $ | 419,546 |  |  | $ | 66,071 |  |  | $ | 129,533 |  |  | $ | 1,041,579 |
|  | Reportable Segments
|  | Six Months Ended June 26, 2022
Major Products/Services Lines |  | Domestic Company-owned restaurants |  | North America franchising |  | North America commissaries |  | International |  | All others |  | Total
Company-owned restaurant sales |  | $ | 370,176 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 370,176 |
Franchise royalties and fees |  | — |  |  | 71,286 |  |  | — |  |  | 25,478 |  |  | — |  |  | 96,764 |
Commissary sales |  | — |  |  | — |  |  | 540,323 |  |  | 41,097 |  |  | — |  |  | 581,420 |
Other revenues |  | — |  |  | — |  |  | — |  |  | 15,414 |  |  | 150,213 |  |  | 165,627 |
Eliminations |  | — |  |  | (2,101) |  |  | (111,261) |  |  | — |  |  | (35,268) |  |  | (148,630) |
Total segment revenues |  | 370,176 |  |  | 69,185 |  |  | 429,062 |  |  | 81,989 |  |  | 114,945 |  |  | 1,065,357 |
International other revenues (a) |  | — |  |  | — |  |  | — |  |  | (15,414) |  |  | 15,414 |  |  | — |
Total revenues |  | $ | 370,176 |  |  | $ | 69,185 |  |  | $ | 429,062 |  |  | $ | 66,575 |  |  | $ | 130,359 |  |  | $ | 1,065,357 |
___________________________________ (a) Other revenues as reported in the Condensed Consolidated Statements of Operations include $6.7 million and $14.0 million of revenues for the three and six months ended June 25, 2023, respectively, and $7.3 million and $15.4 million for the three and six months ended June 26, 2022, respectively, that are part of the International reporting segment. These amounts include marketing fund contributions and sublease rental income from international franchisees in the United Kingdom that provide no significant contribution to operating income but must be reported on a gross basis under accounting requirements. The related expenses for these Other revenues are reported in Other expenses in the Condensed Consolidated Statements of Operations.

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