PASADENA, Calif.--(BUSINESS WIRE)-- Dine Brands Global, Inc. (NYSE: DIN), the parent company of Applebee’s Neighborhood Grill & Bar ® , IHOP ® and Fuzzy’s Taco Shop ® restaurants, today announced financial results for the third quarter of fiscal year 2024.
“During the third quarter, we continued to experience consumer pullback and the pressures of a highly promotional operating environment. We know we need to do more in the near term to drive traffic and get back to better top-line performance. For the fourth quarter, we are enhancing our value proposition for guests and remain focused on executing our plans across our brands,” said John Peyton, chief executive officer, Dine Brands Global, Inc.
Vance Chang, chief financial officer, Dine Brands Global, Inc., added, “Our third quarter results demonstrated the resiliency of our business model despite the challenges to our top line. Our cash flow generation ability through market cycles is supported by our asset-lite model and the scale of our platform. We are confident in our ability to drive long-term value for our stakeholders.”
Domestic Restaurant Sales for the Third Quarter of 2024
Third Quarter of 2024 Summary
First Nine Months of 2024 Summary
Key Balance Sheet Metrics (as of September 30, 2024)
GAAP Effective Tax Rate
The Company's effective tax rate was 26.9% for the nine months ended September 30, 2024, as compared to 25.0% for the nine months ended September 30, 2023. The effective tax rate for the nine months ended September 30, 2024 was higher than the rate of the prior comparable period primarily due to a lower tax deduction related to stock-based compensation.
Capital Returns to Equity Holders
During the third quarter of 2024, paid quarterly cash dividends totaling approximately $7.8 million.
Financial Performance Guidance for 2024
The Company’s fiscal year 2024 guidance items have been updated as follows:
Dine Brands does not provide forward-looking guidance for GAAP net income because it is unable to predict certain items contained in the GAAP measure without unreasonable efforts. These items may include closure and impairment charges, loss on extinguishment of debt, gain or loss on disposition of assets, other non-income-based taxes and other items deemed not reflective of current operations.
Third quarter of 2024 Earnings Conference Call Details
Dine Brands will host a conference call to discuss its results on November 6, 2024, at 9:00 a.m. Eastern time . To access the call, please click this conference call registration link, and you will be provided with dial in details. A live webcast of the call, along with a replay, will be available for a limited time at https://investors.dinebrands.com. Participants should allow approximately ten minutes prior to the call’s start time to visit the site and download any streaming media software needed to listen to the webcast. An online archive of the webcast will also be available on Events and Presentations under the Investors section of the Company’s website.
About Dine Brands Global, Inc.
Based in Pasadena, California, Dine Brands Global, Inc. (NYSE: DIN), through its subsidiaries and franchisees, supports and operates restaurants under the Applebee's Neighborhood Grill + Bar®, IHOP®, and Fuzzy’s Taco Shop® brands. As of September 30, 2024, these three brands consisted of over 3,500 restaurants across 19 international markets. Dine Brands is one of the largest full-service restaurant companies in the world and in 2022 expanded into the Fast Casual segment. For more information on Dine Brands, visit the Company’s website located at www.dinebrands.com.
Forward-Looking Statements
Statements contained in this press release may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can identify these forward-looking statements by words such as “may,” “will,” “would,” “should,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan,” “goal” and other similar expressions. These statements involve known and unknown risks, uncertainties and other factors, which may cause actual results to be materially different from those expressed or implied in such statements. These factors include, but are not limited to: general economic conditions, including the impact of inflation, particularly as it may impact our franchisees directly; our level of indebtedness; compliance with the terms of our securitized debt; our ability to refinance our current indebtedness or obtain additional financing; our dependence on information technology; potential cyber incidents; the implementation of restaurant development plans; our dependence on our franchisees; the concentration of our Applebee’s franchised restaurants in a limited number of franchisees; the financial health of our franchisees including any insolvency or bankruptcy; credit risks from our IHOP franchisees operating under our previous IHOP business model in which we built and equipped IHOP restaurants and then franchised them to franchisees; insufficient insurance coverage to cover potential risks associated with the ownership and operation of restaurants; our franchisees’ and other licensees’ compliance with our quality standards and trademark usage; general risks associated with the restaurant industry; potential harm to our brands’ reputation; risks of food-borne illness or food tampering; possible future impairment charges; trading volatility and fluctuations in the price of our stock; our ability to achieve the financial guidance we provide to investors; successful implementation of our business strategy; the availability of suitable locations for new restaurants; shortages or interruptions in the supply or delivery of products from third parties or availability of utilities; the management and forecasting of appropriate inventory levels; development and implementation of innovative marketing and use of social media; changing health or dietary preference of consumers; risks associated with doing business in international markets; the results of litigation and other legal proceedings; third-party claims with respect to intellectual property assets; delivery initiatives and use of third-party delivery vendors; our allocation of human capital and our ability to attract and retain management and other key employees; compliance with federal, state and local governmental regulations; risks associated with our self-insurance; natural disasters, pandemics, epidemics, or other serious incidents; our success with development initiatives outside of our core business; the adequacy of our internal controls over financial reporting and future changes in accounting standards; and other factors discussed from time to time in the Corporation’s Annual and Quarterly Reports on Forms 10-K and 10-Q and in the Corporation’s other filings with the Securities and Exchange Commission. The forward-looking statements contained in this press release are made as of the date hereof and the Corporation does not intend to, nor does it assume any obligation to, update or supplement any forward-looking statements after the date hereof to reflect actual results or future events or circumstances.
Non-GAAP Financial Measures
This press release includes references to the Company's non-GAAP financial measure “adjusted net income available to common stockholders”, “adjusted earnings per diluted share (Adjusted EPS)”, “Adjusted EBITDA” and “Adjusted free cash flow.” Adjusted EPS is computed for a given period by deducting from net income or loss available to common stockholders for such period the effect of any closure and impairment charges, any intangible asset amortization, any non-cash interest expense, any gain or loss related to the disposition of assets, any gain or loss related to debt extinguishment, and other items deemed not reflective of current operations. This is presented on an aggregate basis and a per share (diluted) basis. Adjusted EBITDA is computed for a given period by deducting from net income or loss for such period the effect of any interest expense, any income tax provision or benefit, any depreciation and amortization, any non-cash stock-based compensation, any closure and impairment charges, any gain or loss related to debt extinguishment, any gain or loss related to the disposition of assets, and other items deemed not reflective of current operations. “Adjusted free cash flow” for a given period is defined as cash provided by operating activities, plus receipts from notes and equipment contracts receivable, less capital expenditures. Management may use certain of these non-GAAP financial measures along with the corresponding U.S. GAAP measures to evaluate the performance of the business and to make certain business decisions. Management uses adjusted free cash flow in its periodic assessments of, among other things, the amount of cash dividends per share of common stock and repurchases of common stock and we believe it is important for investors to have the same measure used by management for that purpose. Adjusted free cash flow does not represent residual cash flow available for discretionary purposes. Management believes that these non-GAAP financial measures provide additional meaningful information that should be considered when assessing the business and the Company’s performance compared to prior periods and the marketplace. Adjusted EPS and adjusted free cash flow are supplemental non-GAAP financial measures and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with U.S. GAAP.
FBN-R
|
Dine Brands Global, Inc. and Subsidiaries |
||||||||||||||||
|
Consolidated Statements of Comprehensive Income |
||||||||||||||||
|
(In thousands, except per share amounts) |
||||||||||||||||
|
(Unaudited) |
||||||||||||||||
|
|
|
|
||||||||||||||
|
|
Three Months Ended |
Nine Months Ended |
||||||||||||||
|
|
September 30, |
September 30, |
||||||||||||||
|
|
2024 |
2023 |
2024 |
2023 |
||||||||||||
|
Revenues: |
|
|
|
|||||||||||||
|
Franchise revenues: |
|
|
|
|
||||||||||||
|
Royalties, franchise fees and other |
$ |
96,565 |
|
$ |
99,135 |
|
$ |
299,161 |
|
$ |
303,998 |
|
||||
|
Advertising revenues |
|
69,789 |
|
|
73,385 |
|
|
219,568 |
|
|
226,401 |
|
||||
|
Total franchise revenues |
|
166,354 |
|
|
172,520 |
|
|
518,729 |
|
|
530,399 |
|
||||
|
Company restaurant sales |
|
267 |
|
|
308 |
|
|
840 |
|
|
1,839 |
|
||||
|
Rental revenues |
|
27,991 |
|
|
29,128 |
|
|
86,546 |
|
|
90,519 |
|
||||
|
Financing revenues |
|
422 |
|
|
628 |
|
|
1,421 |
|
|
2,009 |
|
||||
|
Total revenues |
|
195,034 |
|
|
202,584 |
|
|
607,536 |
|
|
624,766 |
|
||||
|
Cost of revenues: |
|
|
|
|
||||||||||||
|
Franchise expenses: |
|
|
|
|
||||||||||||
|
Advertising expenses |
|
69,789 |
|
|
73,385 |
|
|
219,568 |
|
|
226,401 |
|
||||
|
Bad debt (credit) expense |
|
151 |
|
|
(51 |
) |
|
(395 |
) |
|
2,593 |
|
||||
|
Other franchise expenses |
|
9,787 |
|
|
9,804 |
|
|
31,980 |
|
|
29,790 |
|
||||
|
Total franchise expenses |
|
79,727 |
|
|
83,138 |
|
|
251,153 |
|
|
258,784 |
|
||||
|
Company restaurant expenses |
|
304 |
|
|
323 |
|
|
915 |
|
|
1,833 |
|
||||
|
Rental expenses: |
|
|
|
|
||||||||||||
|
Interest expense from finance leases |
|
729 |
|
|
668 |
|
|
2,208 |
|
|
2,072 |
|
||||
|
Other rental expenses |
|
20,879 |
|
|
21,066 |
|
|
63,005 |
|
|
63,538 |
|
||||
|
Total rental expenses |
|
21,608 |
|
|
21,734 |
|
|
65,213 |
|
|
65,610 |
|
||||
|
Financing expenses |
|
76 |
|
|
91 |
|
|
241 |
|
|
283 |
|
||||
|
Total cost of revenues |
|
101,715 |
|
|
105,286 |
|
|
317,522 |
|
|
326,510 |
|
||||
|
Gross profit |
|
93,319 |
|
|
97,298 |
|
|
290,014 |
|
|
298,256 |
|
||||
|
General and administrative expenses |
|
45,390 |
|
|
48,618 |
|
|
144,435 |
|
|
147,545 |
|
||||
|
Interest expense, net |
|
18,369 |
|
|
19,059 |
|
|
54,291 |
|
|
51,549 |
|
||||
|
Closure and impairment charges |
|
366 |
|
|
1,774 |
|
|
1,442 |
|
|
3,088 |
|
||||
|
Amortization of intangible assets |
|
2,724 |
|
|
2,709 |
|
|
8,169 |
|
|
8,202 |
|
||||
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
10 |
|
||||
|
Loss (gain) on disposition of assets |
|
6 |
|
|
191 |
|
|
(57 |
) |
|
2,309 |
|
||||
|
Income before income taxes |
|
26,464 |
|
|
24,947 |
|
|
81,734 |
|
|
85,553 |
|
||||
|
Income tax provision |
|
(7,403 |
) |
|
(6,468 |
) |
|
(22,018 |
) |
|
(21,416 |
) |
||||
|
Net income |
|
19,061 |
|
|
18,479 |
|
|
59,716 |
|
|
64,137 |
|
||||
|
Other comprehensive income (loss) net of tax: |
|
|
|
|
||||||||||||
|
Foreign currency translation adjustment |
|
2 |
|
|
(2 |
) |
|
(3 |
) |
|
(2 |
) |
||||
|
Total comprehensive income |
$ |
19,063 |
|
$ |
18,477 |
|
$ |
59,713 |
|
$ |
64,135 |
|
||||
|
Net income available to common stockholders: |
|
|
|
|
||||||||||||
|
Net income |
$ |
19,061 |
|
$ |
18,479 |
|
$ |
59,716 |
|
$ |
64,137 |
|
||||
|
Less: Net income allocated to unvested participating restricted stock |
|
(553 |
) |
|
(431 |
) |
|
(1,760 |
) |
|
(1,551 |
) |
||||
|
Net income available to common stockholders |
$ |
18,508 |
|
$ |
18,048 |
|
$ |
57,956 |
|
$ |
62,586 |
|
||||
|
|
|
|
|
|
||||||||||||
|
Net income available to common stockholders per share: |
|
|
|
|
||||||||||||
|
Basic |
$ |
1.24 |
|
$ |
1.19 |
|
$ |
3.88 |
|
$ |
4.10 |
|
||||
|
Diluted |
$ |
1.24 |
|
$ |
1.19 |
|
$ |
3.88 |
|
$ |
4.09 |
|
||||
|
Weighted average shares outstanding: |
|
|
|
|
||||||||||||
|
Basic |
|
14,897 |
|
|
15,217 |
|
|
14,940 |
|
|
15,275 |
|
||||
|
Diluted |
|
14,897 |
|
|
15,220 |
|
|
14,940 |
|
|
15,289 |
|
||||
|
Dine Brands Global, Inc. and Subsidiaries |
||||||||
|
Consolidated Balance Sheets |
||||||||
|
(In thousands) |
||||||||
|
|
|
|
|
|
||||
|
|
|
September 30, 2024 |
|
December 31, 2023 |
||||
|
Assets |
|
(Unaudited) |
|
|
||||
|
Current assets: |
|
|
||||||
|
Cash and cash equivalents |
$ |
169,636 |
|
$ |
146,034 |
|
||
|
Receivables, net of allowance |
|
83,414 |
|
|
127,937 |
|
||
|
Restricted cash |
|
45,974 |
|
|
35,058 |
|
||
|
Prepaid gift card costs |
|
23,493 |
|
|
29,545 |
|
||
|
Prepaid income taxes |
|
806 |
|
|
3,445 |
|
||
|
Other current assets |
|
8,108 |
|
|
15,759 |
|
||
|
Total current assets |
|
331,431 |
|
|
357,778 |
|
||
|
Non-current restricted cash |
|
19,500 |
|
|
19,500 |
|
||
|
Property and equipment, net |
|
154,932 |
|
|
161,891 |
|
||
|
Operating lease right-of-use assets |
|
282,202 |
|
|
275,214 |
|
||
|
Deferred rent receivable |
|
26,721 |
|
|
33,326 |
|
||
|
Long-term receivables, net of allowance |
|
33,508 |
|
|
35,602 |
|
||
|
Goodwill |
|
254,062 |
|
|
254,062 |
|
||
|
Other intangible assets, net |
|
578,309 |
|
|
586,033 |
|
||
|
Other non-current assets, net |
|
18,874 |
|
|
16,881 |
|
||
|
Total assets |
$ |
1,699,539 |
|
$ |
1,740,287 |
|
||
|
Liabilities and Stockholders’ Deficit |
|
|
||||||
|
Current liabilities: |
|
|
||||||
|
Current maturities of long-term debt |
$ |
100,000 |
|
$ |
100,000 |
|
||
|
Accounts payable |
|
35,455 |
|
|
36,193 |
|
||
|
Gift card liability |
|
137,020 |
|
|
175,640 |
|
||
|
Current maturities of operating lease obligations |
|
61,181 |
|
|
63,498 |
|
||
|
Current maturities of finance lease and financing obligations |
|
6,713 |
|
|
7,243 |
|
||
|
Accrued employee compensation and benefits |
|
12,063 |
|
|
23,211 |
|
||
|
Accrued advertising expenses |
|
3,616 |
|
|
9,446 |
|
||
|
Dividends payable |
|
7,790 |
|
|
7,827 |
|
||
|
Other accrued expenses |
|
23,012 |
|
|
37,394 |
|
||
|
Total current liabilities |
|
386,850 |
|
|
460,452 |
|
||
|
Long-term debt, net, less current maturities |
|
1,086,026 |
|
|
1,084,502 |
|
||
|
Operating lease obligations, less current maturities |
|
271,283 |
|
|
269,097 |
|
||
|
Finance lease obligations, less current maturities |
|
35,720 |
|
|
34,389 |
|
||
|
Financing obligations, less current maturities |
|
24,940 |
|
|
26,984 |
|
||
|
Deferred income taxes, net |
|
57,493 |
|
|
60,829 |
|
||
|
Deferred franchise revenue, long-term |
|
37,681 |
|
|
38,658 |
|
||
|
Other non-current liabilities |
|
16,216 |
|
|
16,350 |
|
||
|
Total liabilities |
|
1,916,209 |
|
|
1,991,261 |
|
||
|
Commitments and contingencies |
|
|
||||||
|
Stockholders’ deficit: |
|
|
||||||
|
Common stock |
|
248 |
|
|
249 |
|
||
|
Additional paid-in-capital |
|
252,994 |
|
|
256,542 |
|
||
|
Retained earnings |
|
186,237 |
|
|
150,008 |
|
||
|
Accumulated other comprehensive loss |
|
(67 |
) |
|
(64 |
) |
||
|
Treasury stock, at cost |
|
(656,082 |
) |
|
(657,709 |
) |
||
|
Total stockholders’ deficit |
|
(216,670 |
) |
|
(250,974 |
) |
||
|
Total liabilities and stockholders’ deficit |
$ |
1,699,539 |
|
$ |
1,740,287 |
|
||
|
Dine Brands Global, Inc. and Subsidiaries |
||||||||
|
Consolidated Statements of Cash Flows |
||||||||
|
(In thousands) (Unaudited) |
||||||||
|
|
|
|
||||||
|
|
|
Nine Months Ended |
||||||
|
|
|
September 30, |
||||||
|
|
|
2024 |
|
2023 |
||||
|
Cash flows from operating activities: |
|
|
||||||
|
Net income |
$ |
59,716 |
|
$ |
64,137 |
|
||
|
Adjustments to reconcile net income to cash flows provided by operating activities: |
|
|
||||||
|
Depreciation and amortization |
|
29,049 |
|
|
26,221 |
|
||
|
Non-cash closure and impairment charges |
|
1,442 |
|
|
3,088 |
|
||
|
Non-cash stock-based compensation expense |
|
12,572 |
|
|
8,167 |
|
||
|
Non-cash interest expense |
|
2,448 |
|
|
2,714 |
|
||
|
Loss on extinguishment of debt |
|
— |
|
|
10 |
|
||
|
Deferred income taxes |
|
(3,335 |
) |
|
(3,582 |
) |
||
|
Deferred revenue |
|
(3,431 |
) |
|
(2,590 |
) |
||
|
(Gain) loss on disposition of assets |
|
(57 |
) |
|
2,309 |
|
||
|
Other |
|
(2,894 |
) |
|
(1,577 |
) |
||
|
Changes in operating assets and liabilities: |
|
|
||||||
|
Receivables, net |
|
6,937 |
|
|
6,354 |
|
||
|
Deferred rent receivable |
|
6,605 |
|
|
6,792 |
|
||
|
Current income tax receivable and payable |
|
1,352 |
|
|
(186 |
) |
||
|
Gift card receivable and payable |
|
(13,060 |
) |
|
(13,588 |
) |
||
|
Other current assets |
|
7,624 |
|
|
6,358 |
|
||
|
Accounts payable |
|
(2,100 |
) |
|
(15,527 |
) |
||
|
Operating lease assets and liabilities |
|
(9,716 |
) |
|
2,438 |
|
||
|
Accrued employee compensation and benefits |
|
(11,033 |
) |
|
(4,447 |
) |
||
|
Accrued advertising |
|
(1,827 |
) |
|
(9,750 |
) |
||
|
Other current liabilities |
|
(2,598 |
) |
|
1,965 |
|
||
|
Cash flows provided by operating activities |
|
77,694 |
|
|
79,306 |
|
||
|
Cash flows from investing activities: |
|
|
||||||
|
Principal receipts from notes, equipment contracts and other long-term receivables |
|
10,388 |
|
|
6,686 |
|
||
|
Additions to property and equipment |
|
(10,305 |
) |
|
(31,968 |
) |
||
|
Proceeds from sale of property and equipment |
|
305 |
|
|
— |
|
||
|
Additions to long-term receivables |
|
(649 |
) |
|
(1,237 |
) |
||
|
Other |
|
(400 |
) |
|
(113 |
) |
||
|
Cash flows used in investing activities |
|
(661 |
) |
|
(26,632 |
) |
||
|
Cash flows from financing activities: |
|
|
||||||
|
Proceeds from issuance of long-term debt |
|
— |
|
|
500,000 |
|
||
|
Repayment of long-term debt |
|
— |
|
|
(651,713 |
) |
||
|
Borrowing from revolving credit facility |
|
— |
|
|
30,000 |
|
||
|
Repayment of revolving credit facility |
|
— |
|
|
(30,000 |
) |
||
|
Payment of debt issuance costs |
|
— |
|
|
(8,044 |
) |
||
|
Dividends paid on common stock |
|
(23,513 |
) |
|
(31,740 |
) |
||
|
Repurchase of common stock |
|
(12,000 |
) |
|
(20,017 |
) |
||
|
Principal payments on finance lease and financing obligations |
|
(4,396 |
) |
|
(5,329 |
) |
||
|
Proceeds from stock options exercised |
|
— |
|
|
3,812 |
|
||
|
Repurchase of restricted stock for tax payments upon vesting |
|
(2,573 |
) |
|
(4,139 |
) |
||
|
Tax payments for share settlement of restricted stock units |
|
(30 |
) |
|
(859 |
) |
||
|
Other |
|
(3 |
) |
|
— |
|
||
|
Cash flows used in financing activities |
|
(42,515 |
) |
|
(218,029 |
) |
||
|
Net change in cash, cash equivalents and restricted cash |
|
34,518 |
|
|
(165,355 |
) |
||
|
Cash, cash equivalents and restricted cash at beginning of period |
|
200,592 |
|
|
324,984 |
|
||
|
Cash, cash equivalents and restricted cash at end of period |
$ |
235,110 |
|
$ |
159,629 |
|
||
Dine Brands Global, Inc. and Subsidiaries
Non-GAAP Financial Measures
(In thousands, except per share amounts)
(Unaudited)
Reconciliation of net income available to common stockholders to net income available to common stockholders, as adjusted for the following items: Closure and impairment charges; amortization of intangible assets; non-cash interest expenses; loss on extinguishment of debt; gain or loss on disposition of assets; acquisition costs; IHOP Flip'd initiative; other EBITDA adjustments; and the combined tax effect of the preceding adjustments, as well as related per share data:
|
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|||||||||
|
|
|
|
|
|
||||||||||||
|
Net income available to common stockholders |
$ |
18,508 |
|
$ |
18,048 |
|
$ |
57,956 |
|
$ |
62,586 |
|
||||
|
Closure and impairment charges |
|
366 |
|
|
1,774 |
|
|
1,442 |
|
|
3,088 |
|
||||
|
Amortization of intangible assets |
|
2,724 |
|
|
2,709 |
|
|
8,169 |
|
|
8,202 |
|
||||
|
Non-cash interest expense |
|
829 |
|
|
779 |
|
|
2,448 |
|
|
2,714 |
|
||||
|
Loss (gain) on disposition of assets |
|
6 |
|
|
191 |
|
|
(57 |
) |
|
2,309 |
|
||||
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
10 |
|
||||
|
Acquisition costs |
|
— |
|
|
— |
|
|
— |
|
|
804 |
|
||||
|
IHOP Flip'd initiative |
|
— |
|
|
— |
|
|
— |
|
|
5,121 |
|
||||
|
Other EBITDA adjustments |
|
119 |
|
|
361 |
|
|
484 |
|
|
2,232 |
|
||||
|
Net income tax provision for above adjustments |
|
(1,051 |
) |
|
(1,512 |
) |
|
(3,246 |
) |
|
(6,365 |
) |
||||
|
Net income allocated to unvested participating restricted stock |
|
(89 |
) |
|
(99 |
) |
|
(274 |
) |
|
(439 |
) |
||||
|
Net income available to common stockholders, as adjusted |
$ |
21,412 |
|
$ |
22,251 |
|
$ |
66,922 |
|
$ |
80,262 |
|
||||
|
|
|
|
|
|
||||||||||||
|
Diluted net income available to common stockholders per share (a): |
|
|
|
|
||||||||||||
|
Net income available to common stockholders |
$ |
1.24 |
|
$ |
1.19 |
|
$ |
3.88 |
|
$ |
4.09 |
|
||||
|
Closure and impairment charges |
|
0.02 |
|
|
0.09 |
|
|
0.07 |
|
|
0.15 |
|
||||
|
Amortization of intangible assets |
|
0.14 |
|
|
0.13 |
|
|
0.40 |
|
|
0.40 |
|
||||
|
Non-cash interest expense |
|
0.04 |
|
|
0.04 |
|
|
0.12 |
|
|
0.13 |
|
||||
|
Loss (gain) on disposition of assets |
|
0.00 |
|
|
0.01 |
|
|
0.00 |
|
|
0.11 |
|
||||
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
0.00 |
|
||||
|
Acquisition costs |
|
— |
|
|
— |
|
|
— |
|
|
0.04 |
|
||||
|
IHOP Flip'd initiative |
|
— |
|
|
— |
|
|
— |
|
|
0.25 |
|
||||
|
Other EBITDA adjustments |
|
0.01 |
|
|
0.02 |
|
|
0.02 |
|
|
0.11 |
|
||||
|
Net income allocated to unvested participating restricted stock |
|
(0.01 |
) |
|
(0.01 |
) |
|
(0.02 |
) |
|
(0.03 |
) |
||||
|
Rounding |
|
— |
|
|
(0.01 |
) |
|
0.01 |
|
|
— |
|
||||
|
Diluted net income available to common stockholders per share, as adjusted |
$ |
1.44 |
|
$ |
1.46 |
|
$ |
4.48 |
|
$ |
5.25 |
|
||||
|
|
|
|
|
|
||||||||||||
|
Numerator for basic EPS - net income available to common stockholders, as adjusted |
$ |
21,412 |
|
$ |
22,251 |
|
$ |
66,922 |
|
$ |
80,262 |
|
||||
|
Effect of unvested participating restricted stock using the two-class method |
|
— |
|
|
— |
|
|
0 |
|
|
— |
|
||||
|
Numerator for diluted EPS - net income available to common stockholders, as adjusted |
$ |
21,412 |
|
$ |
22,251 |
|
$ |
66,922 |
|
$ |
80,262 |
|
||||
|
|
|
|
|
|
||||||||||||
|
Denominator for basic EPS - weighted-average shares |
|
14,897 |
|
|
15,217 |
|
|
14,940 |
|
|
15,275 |
|
||||
|
Dilutive effect of stock options |
|
— |
|
|
3 |
|
|
— |
|
|
14 |
|
||||
|
Denominator for diluted EPS - weighted-average shares |
|
14,897 |
|
|
15,220 |
|
|
14,940 |
|
|
15,289 |
|
||||
|
_________________________________ |
||
|
(a) |
Diluted net income available to common stockholders per share for the three and nine months ended September 30, 2024 and 2023 presented on an after-tax basis. |
|
Dine Brands Global, Inc. and Subsidiaries
Non-GAAP Financial Measures
(Unaudited)
Reconciliation of the Company's cash flows provided by operating activities to “adjusted free cash flow” (cash flows provided by operating activities, plus receipts from notes and equipment contracts receivable, less additions to property and equipment). Management uses this liquidity measure in its periodic assessments of, among other things, the amount of cash dividends per share of common stock and repurchases of common stock. We believe it is important for investors to have the same measure used by management for that purpose. Adjusted free cash flow does not represent residual cash flow available for discretionary purposes.
|
|
Nine Months Ended September 30, |
|||||||
|
|
2024 |
|
2023 |
|||||
|
|
(In thousands) |
|||||||
|
Cash flows provided by operating activities |
$ |
77,694 |
|
$ |
79,306 |
|
||
|
Principal receipts from notes and equipment contracts |
|
10,388 |
|
|
6,686 |
|
||
|
Net additions to property and equipment |
|
(10,305 |
) |
|
(31,968 |
) |
||
|
Adjusted free cash flow |
|
77,777 |
|
|
54,024 |
|
||
|
Repayment of long-term debt, net |
|
— |
|
|
(151,713 |
) |
||
|
Dividends paid on common stock |
|
(23,513 |
) |
|
(31,740 |
) |
||
|
Repurchase of common stock |
|
(12,000 |
) |
|
(20,017 |
) |
||
|
|
$ |
42,264 |
|
$ |
(149,446 |
) |
||
Dine Brands Global, Inc. and Subsidiaries
Non-GAAP Financial Measures
(in thousands)
(Unaudited)
Reconciliation of the Company's net income to “adjusted EBITDA.” The Company defines adjusted EBITDA as net income or loss, adjusted for the effect of interest expense, income tax provision or benefit, depreciation and amortization, non-cash stock-based compensation, closure and impairment charges, loss on extinguishment of debt, gain or loss on disposition of assets, and other items deemed not reflective of current operations. Management may use certain non-GAAP measures along with the corresponding U.S. GAAP measures to evaluate the performance of the Company and to make certain business decisions.
|
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|||||||||
|
|
|
|
|
|
||||||||||||
|
Net income, as reported |
$ |
19,061 |
|
$ |
18,479 |
|
$ |
59,716 |
|
$ |
64,137 |
|
||||
|
Interest expense on finance leases |
|
729 |
|
|
668 |
|
|
2,208 |
|
|
2,072 |
|
||||
|
All other interest expense |
|
20,748 |
|
|
21,178 |
|
|
62,260 |
|
|
58,672 |
|
||||
|
Income tax provision |
|
7,403 |
|
|
6,468 |
|
|
22,018 |
|
|
21,416 |
|
||||
|
Depreciation and amortization |
|
9,654 |
|
|
8,587 |
|
|
29,049 |
|
|
26,221 |
|
||||
|
Non-cash stock-based compensation |
|
3,816 |
|
|
2,858 |
|
|
12,572 |
|
|
8,167 |
|
||||
|
Closure and impairment charges |
|
366 |
|
|
1,774 |
|
|
1,442 |
|
|
3,088 |
|
||||
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
10 |
|
||||
|
Loss (gain) on disposition of assets |
|
6 |
|
|
191 |
|
|
(57 |
) |
|
2,309 |
|
||||
|
IHOP Flip'd initiative |
|
— |
|
|
— |
|
|
— |
|
|
5,121 |
|
||||
|
Other |
|
119 |
|
|
361 |
|
|
484 |
|
|
3,036 |
|
||||
|
Adjusted EBITDA |
$ |
61,902 |
|
$ |
60,564 |
|
$ |
189,692 |
|
$ |
194,249 |
|
||||
Dine Brands Global, Inc. and Subsidiaries
Restaurant Data
(Unaudited)
The following table sets forth, for the three and nine months ended September 30, 2024, the number of “Effective Restaurants” in the Applebee’s, IHOP and Fuzzy's systems and information regarding the percentage change in sales at those restaurants compared to the same periods in the prior year and, as such, the percentage change in sales at Effective Restaurants is based on non-GAAP sales data. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. However, we believe that presentation of this information is useful in analyzing our revenues because franchisees and area licensees pay us royalties and advertising fees that are generally based on a percentage of their sales, and, where applicable, rental payments under leases that partially may be based on a percentage of their sales. Management also uses this information to make decisions about future plans for the development of additional restaurants as well as evaluation of current operations.
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||||||
|
|
2024 |
2023 |
2024 |
2023 |
||||||||||||
|
Applebee's Restaurant Data |
|
|||||||||||||||
|
Global Effective Restaurants (a) |
|
|
|
|
||||||||||||
|
Franchise |
|
1,620 |
|
|
1,654 |
|
|
1,627 |
|
|
1,663 |
|
||||
|
Company |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
||||
|
Total |
|
1,620 |
|
|
1,654 |
|
|
1,627 |
|
|
1,663 |
|
||||
|
System-wide (b) |
|
|
|
|
||||||||||||
|
Domestic sales percentage change (c) |
|
(7.1 |
)% |
|
(3.2 |
)% |
|
(5.3 |
)% |
|
0.3 |
% |
||||
|
Domestic same-restaurant sales percentage change (d) |
|
(5.9 |
)% |
|
(2.4 |
)% |
|
(4.1 |
)% |
|
0.9 |
% |
||||
|
Franchise (b) |
|
|
|
|
||||||||||||
|
Domestic sales percentage change (c) |
|
(7.1 |
)% |
|
0.4 |
% |
|
(5.3 |
)% |
|
4.0 |
% |
||||
|
Domestic same-restaurant sales percentage change (d) |
|
(5.9 |
)% |
|
(2.4 |
)% |
|
(4.1 |
)% |
|
0.9 |
% |
||||
|
Average weekly domestic unit sales (in thousands) |
$ |
49.5 |
|
$ |
52.1 |
|
$ |
52.7 |
|
$ |
54.4 |
|
||||
|
|
|
|
|
|
||||||||||||
|
IHOP Restaurant Data |
|
|
|
|
||||||||||||
|
Global Effective Restaurants(a) |
|
|
|
|
||||||||||||
|
Franchise |
|
1,645 |
|
|
1,631 |
|
|
1,645 |
|
|
1,626 |
|
||||
|
Area license |
|
155 |
|
|
156 |
|
|
155 |
|
|
156 |
|
||||
|
Total |
|
1,800 |
|
|
1,787 |
|
|
1,800 |
|
|
1,782 |
|
||||
|
System-wide(b) |
|
|
|
|
||||||||||||
|
Sales percentage change(c) |
|
(1.6 |
)% |
|
4.2 |
% |
|
(0.5 |
)% |
|
6.6 |
% |
||||
|
Domestic same-restaurant sales percentage change, including area license restaurants(d) |
|
(2.1 |
)% |
|
2.0 |
% |
|
(1.7 |
)% |
|
4.2 |
% |
||||
|
Franchise(b) |
|
|
|
|
||||||||||||
|
Sales percentage change(c) |
|
(1.3 |
)% |
|
4.5 |
% |
|
(0.4 |
)% |
|
6.9 |
% |
||||
|
Domestic same-restaurant sales percentage change(d) |
|
(1.9 |
)% |
|
2.0 |
% |
|
(1.7 |
)% |
|
4.2 |
% |
||||
|
Average weekly unit sales (in thousands) |
$ |
37.0 |
|
$ |
37.8 |
|
$ |
37.7 |
|
$ |
38.3 |
|
||||
|
Area License(b) |
|
|
|
|
||||||||||||
|
Sales percentage change(c) |
|
(3.8 |
)% |
|
1.1 |
% |
|
(1.6 |
)% |
|
4.0 |
% |
||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|||||||||
|
Fuzzy's Restaurant Data |
(Unaudited) |
|||||||||||||||
|
Global Effective Restaurants (a) |
|
|
|
|
||||||||||||
|
Franchise |
|
120 |
|
|
136 |
|
|
124 |
|
|
135 |
|
||||
|
Company |
|
1 |
|
|
1 |
|
|
1 |
|
|
2 |
|
||||
|
Total |
|
121 |
|
|
137 |
|
|
125 |
|
|
137 |
|
||||
|
System-wide (b) |
|
|
|
|
||||||||||||
|
Domestic sales percentage change (c) |
|
(15.8 |
)% | |||||||||||||