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Segments | 9 Months Ended
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Sep. 30, 2023
Segment Reporting [Abstract] |
Segments | Segments The Company identifies its reporting segments based on the organizational units used by management to monitor performance and make operating decisions. The Company currently has six operating segments: Applebee's franchise operations, IHOP franchise operations, Fuzzy's franchise operations, rental operations, financing operations, and company-operated restaurant operations. The Company has four reporting segments: franchise operations (an aggregation of each restaurant concept's franchise operations), company-operated restaurant operations, rental operations and financing operations. As of September 30, 2023, the franchise operations segment consisted of 1,652 restaurants operated by Applebee’s franchisees in the United States, two U.S. territories and 13 countries outside the United States; 1,794 restaurants operated by IHOP franchisees and area licensees in the United States, two U.S. territories and 13 countries outside the United States; and 137 restaurants operated by Fuzzy's franchisees in the United States. Franchise operations revenue consists primarily of franchise royalty revenues, franchise advertising revenue, sales of proprietary products to franchisees, and other franchise fees. Franchise operations expenses include advertising expense, the cost of proprietary products, pre-opening training expenses and other franchise-related costs. Rental operations revenue includes revenue from operating leases and interest income from real estate leases. Rental operations expenses are costs of operating leases and interest expense from finance leases on which the Company is the lessee. Financing operations revenue primarily consists of interest income from the financing of IHOP equipment leases and franchise fees and interest income on notes receivable due from franchisees. Financing operations expenses primarily are the cost of taxes related to IHOP equipment leases. During the three and nine months ended September 30, 2023, the company restaurants segment consisted of three Fuzzy's restaurants that were acquired in December 2022 of which two were subsequently refranchised in the second quarter of 2023. During three and nine months ended September 30, 2022, the Company operated 69 Applebee's restaurants that were refranchised in October 2022. All company-operated restaurants are located in the United States. Company-operated restaurant operation revenue consists of retail sales at company operated restaurants. Company-operated restaurant operation expenses are operating expenses such as food, beverage, labor, benefits, utilities, rent and other operating costs. Information on segments is as follows:
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2023 |  | 2022 |  | 2023 |  | 2022
|  | (In millions)
Revenues from external customers: |  |  |  |  |  |  |  |
Franchise operations |  | 172.5 |  |  | $ | 164.9 |  |  | 530.4 |  |  | $ | 494.4 |
Rental operations |  | 29.1 |  |  | 29.2 |  |  | 90.5 |  |  | 87.1 |
Company restaurants |  | 0.3 |  |  | 38.2 |  |  | 1.8 |  |  | 117.2 |
Financing operations |  | 0.6 |  |  | 0.9 |  |  | 2.0 |  |  | 2.8 |
Total |  | $ | 202.6 |  |  | $ | 233.2 |  |  | $ | 624.8 |  |  | $ | 701.4 |
Interest expense: |  |  |  |  |  |  |  |
Rental operations |  | $ | 0.9 |  |  | $ | 1.1 |  |  | $ | 2.9 |  |  | $ | 3.2 |
Company restaurants |  | — |  |  | 0.7 |  |  | — |  |  | 2.4 |
Corporate |  | 19.1 |  |  | 15.3 |  |  | 51.5 |  |  | 46.2 |
Total |  | $ | 20.0 |  |  | $ | 17.1 |  |  | $ | 54.4 |  |  | $ | 51.8 |
Depreciation and amortization: |  |  |  |  |  |  |  |
Franchise operations |  | $ | 2.4 |  |  | $ | 2.5 |  |  | $ | 7.3 |  |  | $ | 7.5 |
Rental operations |  | 2.6 |  |  | 2.7 |  |  | 7.8 |  |  | 8.0 |
Company restaurants |  | 0.0 |  |  | 0.5 |  |  | 0.0 |  |  | 4.3 |
Corporate |  | 3.6 |  |  | 3.2 |  |  | 11.1 |  |  | 9.1 |
Total |  | $ | 8.6 |  |  | $ | 8.9 |  |  | $ | 26.2 |  |  | $ | 28.9 |
Gross profit by segment: |  |  |  |  |  |  |  |
Franchise operations |  | $ | 89.4 |  |  | $ | 84.6 |  |  | $ | 271.6 |  |  | $ | 253.8 |
Rental operations |  | 7.4 |  |  | 7.2 |  |  | 24.9 |  |  | 21.1 |
Company restaurants |  | 0.0 |  |  | 1.7 |  |  | 0.0 |  |  | 5.4 |
Financing operations |  | 0.5 |  |  | 0.8 |  |  | 1.7 |  |  | 2.5 |
Total gross profit |  | 97.3 |  |  | 94.3 |  |  | 298.3 |  |  | 282.8 |
Corporate and unallocated expenses, net |  | (72.4) |  |  | (65.6) |  |  | (212.7) |  |  | (187.4) |
Income before income taxes |  | $ | 24.9 |  |  | $ | 28.7 |  |  | $ | 85.6 |  |  | $ | 95.4 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 22 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-22 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-15 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 31 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-31 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 42 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-42 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 40 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-40 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//280/tableOfContent Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 26 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-26 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 34 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-34 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 41 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-41 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 + Details
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