Jack in the Box Inc. (NASDAQ: JACK) today reported financial
results for the second quarter ended April 11, 2021 and provided
fiscal year 2021 financial guidance.
Jack in the Box® total revenues increased 19 percent to $257.2
million, compared to $216.2 million in the comparable period ended
April 12, 2020, driven by 20.6 percent growth in system same-store
sales. Company same-store sales increased 14.5 percent in the
second quarter, reflecting average check growth of 19.9 percent and
a 5.4 percent decrease in transactions. Franchise same-store sales
increased 21.3 percent.
Increase/(Decrease) in same-store sales:
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Company
14.5%
(4.1)%
10.4%
(0.1)%
Franchise
21.3%
(4.2)%
16.5%
(0.9)%
System
20.6%
(4.2)%
15.9%
(0.8)%
Net earnings more than tripled to $35.9 million, or $1.58 per
diluted share, for the second quarter of fiscal 2021, compared with
$11.5 million, or $0.50 per diluted share, for the second quarter
of fiscal 2020, which was negatively impacted due to the initial
onset of COVID-19.
Darin Harris, chief executive officer, said, "Consumers continue
to embrace Jack in the Box's iconic all-day menu and continuous
menu innovations, driving growth across every day-part. A shift
toward our core premium entrees, combined with an increase in items
per order reflecting larger parties, fueled a nearly-20 percent
increase in average check. Our performance was strong across all
regions throughout the quarter, including in Texas where pandemic
dine-in restrictions were lifted much earlier than in our other
large markets. Stimulus payments also contributed to our strong
performance during the last four weeks of the quarter."
Harris continued, “We are off to a good start through the first
four weeks of the third quarter, giving us confidence that our key
strategies continue to resonate with guests and position us to
maintain momentum while we work closely with our franchisees to
grow.”
Operating Earnings Per Share(1), a non-GAAP measure, were $1.48
in the second quarter of fiscal 2021 compared with $0.50 in the
prior year quarter. A reconciliation of non-GAAP Operating Earnings
Per Share to GAAP results is provided below, with additional
information included in the attachment to this release.
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Diluted earnings per share – GAAP
$
1.58
$
0.50
$
3.78
$
0.82
Gains on the sale of company-operated
restaurants
(0.05
)
—
(0.09
)
(0.05
)
Excess tax benefits from share-based
compensation arrangements
(0.05
)
(0.01
)
(0.05
)
—
Pension settlement charges
—
0.01
—
1.14
Gain on sale of corporate office
building
—
—
—
(0.32
)
Restructuring charges
—
—
—
0.03
Operating Earnings Per Share – non-GAAP
(1)
$
1.48
$
0.50
$
3.64
$
1.62
Adjusted EBITDA(2), a non-GAAP measure, was $75.8 million in the
second quarter of fiscal 2021 compared with $46.3 million for the
prior year quarter.
Restaurant-Level Margin(3), a non-GAAP measure, increased to
25.9 percent of company restaurant sales in the second quarter of
fiscal 2021 from 20.6 percent a year ago. The increase is primarily
due to sales leverage as well as a decrease in food and packaging
costs as a percentage of company restaurant sales. This decrease is
primarily driven by favorable changes in product mix and menu price
increases, partially offset by higher costs for ingredients.
Commodity costs increased in the quarter by approximately 1.7
percent, primarily due to increases in pork and oil, partially
offset by a decrease in beef. The decrease in food and packaging
costs was partially offset by higher labor costs, resulting from
wage inflation of 6.3%, as well as higher incentive compensation
costs and higher costs for delivery fees.
Franchise-Level Margin(3), a non-GAAP measure, increased by
$17.2 million in the second quarter, primarily driven by higher
royalties and rental revenues as a result of higher franchise
same-store sales. Franchise-Level Margin(3), as a percentage of
total franchise revenues, was 42.0 percent in the second quarter of
fiscal 2021 compared with 38.6 percent in the prior year.
In the second quarter of fiscal 2021, SG&A expenses
decreased by $5.3 million and were 7.3 percent of revenues compared
with 11.2 percent in the prior year quarter. Advertising costs,
which are included in SG&A, increased $0.8 million in the
second quarter due to higher company restaurant sales and a
reduction in the contribution rate in the prior year quarter.
As a percentage of system-wide sales, G&A was 1.6 percent in
the second quarter of fiscal 2021 compared with 2.7 percent in the
prior year quarter. The $6.1 million decrease in G&A, which
excludes advertising, was primarily driven by:
- Mark-to-market changes in the cash surrender value of
company-owned life insurance (“COLI”) policies, net of a deferred
compensation obligation supported by these policies, resulting in a
$5.9 million year-over-year decrease in G&A;
- a decrease of $2.1 million in insurance costs; and
- a decrease of $1.9 million in costs related to litigation
matters versus prior year.
- These decreases were partially offset by a $2.3 million
increase in incentive compensation.
The effective tax rate for the second quarter of fiscal 2021 was
27.3 percent compared with 32.3 percent in the prior year quarter.
The lower rate in the quarter was primarily due to a decrease in
the impact of certain non-deductible expenses and an increase in
non-taxable gains related to COLI policies.
Capital Allocation
The company repurchased 0.6 million shares of its common stock
in the second quarter of fiscal 2021 for an aggregate cost of $65.0
million. As of April 11, 2021, $135.0 million remained available
under share repurchase programs authorized by the Board of
Directors, consisting of $35.0 million that expires in November
2021 and $100.0 million that expires in November 2022. During the
second quarter of 2021, the Company fully paid down its outstanding
borrowings on its Variable Funding Notes. As of April 11, 2021,
borrowing availability under the Variable Funding Notes was $110.5
million.
The company also announced today that on May 7, 2021, its Board
of Directors declared a cash dividend of $0.44 per share on the
company's common stock, representing a 10 percent increase from the
prior dividend rate. The dividend is payable on June 11, 2021, to
shareholders of record at the close of business on May 26,
2021.
Fiscal Year 2021 Guidance
The following guidance and underlying assumptions reflect the
company’s current expectations for the fiscal year ending October
3, 2021, which includes 53 weeks:
- High single-digit system same-store sales growth
- G&A as a percentage of system-wide sales of approximately
1.7%, excluding net COLI gains or losses
- Commodity cost inflation of approximately 3%
- Labor cost inflation of 5% to 6%
- Adjusted EBITDA of between approximately $320 million and $330
million, including approximately $6 million to $7 million benefit
from the 53rd week.
Conference Call
The company will host a conference call for financial analysts
and investors on Wednesday, May 12, 2021, beginning at 2:00 p.m. PT
(5:00 p.m. ET). The conference call will be broadcast live over the
Internet via the Jack in the Box Inc. corporate website. To access
the live call through the Internet, log onto the Investors section
of the Jack in the Box Inc. website at
http://investors.jackinthebox.com at least 15 minutes prior to the
event in order to download and install any necessary audio
software. A replay of the call will be available through the Jack
in the Box Inc. corporate website for 21 days, beginning at
approximately 5:00 p.m. PT on May 12, 2021.
About Jack in the Box Inc.
Jack in the Box Inc. (NASDAQ: JACK), based in San Diego, is a
restaurant company that operates and franchises Jack in the Box®
restaurants, one of the nation’s largest hamburger chains, with
more than 2,200 restaurants in 21 states and Guam. For more
information on Jack in the Box, including franchising
opportunities, visit www.jackinthebox.com.
__________________
(1) Operating Earnings Per Share
represents diluted earnings per share on a GAAP basis excluding
gains or losses on the sale of company-operated restaurants,
restructuring charges, gain on sale of corporate office building,
pension settlement charges, and the excess tax benefit from
share-based compensation arrangements. See "Reconciliation of
Non-GAAP Measurements to GAAP Results." Operating earnings per
share may not add due to rounding.
(2) Adjusted EBITDA represents net
earnings on a GAAP basis excluding income taxes, interest expense,
net, gains or losses on the sale of company-operated restaurants,
impairment and other charges, net, depreciation and amortization,
the amortization of franchise tenant improvement allowances and
other, and pension settlement charges. See "Reconciliation of
Non-GAAP Measurements to GAAP Results."
(3) Restaurant-Level Margin and
Franchise-Level Margin are non-GAAP measures. These non-GAAP
measures are reconciled to earnings from operations, the most
comparable GAAP measure, in the attachment to this release. See
"Reconciliation of Non-GAAP Measurements to GAAP Results."
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of the federal securities laws. Forward-looking
statements may be identified by words such as “anticipate,”
“believe,” “estimate,” “expect,” “forecast,” “goals,” “guidance,”
“intend,” “plan,” “project,” “may,” “will,” “would” and similar
expressions. These statements are based on management’s current
expectations, estimates, forecasts and projections about our
business and the industry in which we operate. These estimates and
assumptions involve known and unknown risks, uncertainties, and
other factors that are in some cases beyond our control. Factors
that may cause our actual results to differ materially from any
forward-looking statements include, but are not limited to: the
potential impacts to our business and operations resulting from the
coronavirus COVID-19 pandemic, the success of new products,
marketing initiatives and restaurant remodels and drive-thru
enhancements; the impact of competition, unemployment, trends in
consumer spending patterns and commodity costs; the company's
ability to reduce G&A and operate efficiently; the company’s
ability to achieve and manage its planned growth, which is affected
by the availability of a sufficient number of suitable new
restaurant sites, the performance of new restaurants, risks
relating to expansion into new markets and successful franchise
development; the ability to attract, train and retain
top-performing personnel, litigation risks; risks associated with
disagreements with franchisees; supply chain disruption;
food-safety incidents or negative publicity impacting the
reputation of the company's brand; increased regulatory and legal
complexities, including federal, state and local policies regarding
mitigation strategies for controlling the coronavirus COVID-19
pandemic, risks associated with the amount and terms of the
securitized debt issued by certain of our wholly owned
subsidiaries; and stock market volatility. These and other factors
are discussed in the company’s annual report on Form 10-K and its
periodic reports on Form 10-Q filed with the Securities and
Exchange Commission, which are available online at
http://investors.jackinthebox.com or in hard copy upon request. The
company undertakes no obligation to update or revise any
forward-looking statement, whether as the result of new information
or otherwise.
JACK IN THE BOX INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF EARNINGS
(In thousands, except per
share data)
(Unaudited)
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Revenues:
Company restaurant sales
$
85,962
$
74,380
$
200,240
$
179,744
Franchise rental revenues
77,901
69,885
181,650
165,969
Franchise royalties and other
47,231
37,764
106,879
90,230
Franchise contributions for advertising
and other services
46,123
34,128
106,989
87,887
257,217
216,157
595,758
523,830
Operating costs and expenses, net:
Food and packaging
23,938
22,237
56,315
53,585
Payroll and employee benefits
26,440
24,261
61,371
56,151
Occupancy and other
13,349
12,570
31,184
28,528
Franchise occupancy expenses
48,904
48,341
114,073
112,858
Franchise support and other costs
3,341
2,971
6,614
7,647
Franchise advertising and other services
expenses
47,104
35,734
109,799
90,958
Selling, general and administrative
expenses
18,861
24,203
39,360
52,451
Depreciation and amortization
10,696
12,282
25,267
29,010
Impairment and other charges (gains),
net
1,228
716
776
(8,575
)
Gains on the sale of company-operated
restaurants
(1,532
)
—
(2,815
)
(1,575
)
192,329
183,315
441,944
421,038
Earnings from operations
64,888
32,842
153,814
102,792
Other pension and post-retirement
expenses, net
203
512
474
39,490
Interest expense, net
15,227
15,409
35,962
35,351
Earnings before income taxes
49,458
16,921
117,378
27,951
Income taxes
13,524
5,458
30,585
8,591
Net earnings
$
35,934
$
11,463
$
86,793
$
19,360
Earnings per share:
Basic
$
1.58
$
0.50
$
3.80
$
0.83
Diluted
$
1.58
$
0.50
$
3.78
$
0.82
Weighted-average shares outstanding:
Basic
22,723
22,803
22,863
23,339
Diluted
22,784
22,895
22,945
23,490
Dividends declared per common share
$
0.40
$
0.40
$
0.80
$
0.80
JACK IN THE BOX INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
and per share data)
(Unaudited)
April 11, 2021
September 27,
2020
ASSETS
Current assets:
Cash
$
90,637
$
199,662
Restricted cash
18,137
37,258
Accounts and other receivables, net
86,721
78,417
Inventories
2,158
1,808
Prepaid expenses
6,784
10,114
Current assets held for sale
3,883
4,598
Other current assets
3,703
3,724
Total current assets
212,023
335,581
Property and equipment:
Property and equipment, at cost
1,144,503
1,132,430
Less accumulated depreciation and
amortization
(812,489
)
(796,448
)
Property and equipment, net
332,014
335,982
Other assets:
Operating lease right-of-use assets
914,010
904,548
Intangible assets, net
262
277
Goodwill
47,161
47,161
Deferred tax assets
71,167
72,322
Other assets, net
214,138
210,623
Total other assets
1,246,738
1,234,931
$
1,790,775
$
1,906,494
LIABILITIES AND STOCKHOLDERS’
DEFICIT
Current liabilities:
Current maturities of long-term debt
$
850
$
818
Current operating lease liabilities
153,297
179,000
Accounts payable
24,695
31,105
Accrued liabilities
123,550
129,431
Total current liabilities
302,392
340,354
Long-term liabilities:
Long-term debt, net of current
maturities
1,271,412
1,376,913
Long-term operating lease liabilities, net
of current portion
792,183
776,094
Other long-term liabilities
205,345
206,494
Total long-term liabilities
2,268,940
2,359,501
Stockholders’ deficit:
Preferred stock $0.01 par value,
15,000,000 shares authorized, none issued
—
—
Common stock $0.01 par value, 175,000,000
shares authorized, 82,510,007 and 82,369,714 issued,
respectively
825
824
Capital in excess of par value
496,798
489,515
Retained earnings
1,704,766
1,636,211
Accumulated other comprehensive loss
(108,640
)
(110,605
)
Treasury stock, at cost, 60,287,482 and
59,646,773 shares, respectively
(2,874,306
)
(2,809,306
)
Total stockholders’ deficit
(780,557
)
(793,361
)
$
1,790,775
$
1,906,494
JACK IN THE BOX INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
28 Weeks Ended
April 11, 2021
April 12, 2020
Cash flows from operating activities:
Net earnings
$
86,793
$
19,360
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization
25,267
29,010
Amortization of franchise tenant
improvement allowances and other
1,534
1,765
Deferred finance cost amortization
3,013
3,046
Excess tax benefit from share-based
compensation arrangements
(1,112
)
(77
)
Deferred income taxes
(882
)
6,783
Share-based compensation expense
2,836
5,865
Pension and post-retirement expense
474
39,490
(Gains) losses on cash surrender value of
company-owned life insurance
(9,352
)
3,150
Gains on the sale of company-operated
restaurants
(2,815
)
(1,575
)
Gains on the disposition of property and
equipment, net
(1,931
)
(10,170
)
Non-cash operating lease costs
(11,870
)
(13,118
)
Impairment charges and other
1,340
133
Changes in assets and liabilities,
excluding acquisitions:
Accounts and other receivables
(4,490
)
(22,858
)
Inventories
(288
)
28
Prepaid expenses and other current
assets
3,461
(10,350
)
Accounts payable
(14,614
)
20,660
Accrued liabilities
6,499
1,400
Pension and post-retirement
contributions
(3,577
)
(3,582
)
Franchise tenant improvement allowance
disbursements
(567
)
(5,811
)
Other
(1,175
)
(4,222
)
Cash flows provided by operating
activities
78,544
58,927
Cash flows from investing activities:
Purchases of property and equipment
(22,928
)
(12,777
)
Proceeds from the sale of property and
equipment
3,629
22,394
Proceeds from the sale and leaseback of
assets
—
17,373
Proceeds from the sale of company-operated
restaurants
965
1,575
Other
2,616
1,036
Cash flows (used in) provided by investing
activities
(15,718
)
29,601
Cash flows from financing activities:
Borrowings on revolving credit
facilities
—
111,376
Repayments of borrowings on revolving
credit facilities
(107,875
)
(3,500
)
Principal repayments on debt
(415
)
(3,640
)
Debt issuance costs
—
(216
)
Dividends paid on common stock
(18,130
)
(18,466
)
Proceeds from issuance of common stock
4,340
3,559
Repurchases of common stock
(65,000
)
(155,576
)
Payroll tax payments for equity award
issuances
(3,892
)
(4,442
)
Cash flows used in financing
activities
(190,972
)
(70,905
)
Net (decrease) increase in cash and
restricted cash
(128,146
)
17,623
Cash and restricted cash at beginning of
period
236,920
151,561
Cash and restricted cash at end of
period
$
108,774
$
169,184
JACK IN THE BOX INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
The following table presents certain income and expense items
included in our condensed consolidated statements of earnings as a
percentage of total revenues, unless otherwise indicated.
Percentages may not add due to rounding.
CONDENSED CONSOLIDATED
STATEMENTS OF EARNINGS DATA
(Unaudited)
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Revenues:
Company restaurant sales
33.4
%
34.4
%
33.6
%
34.3
%
Franchise rental revenues
30.3
%
32.3
%
30.5
%
31.7
%
Franchise royalties and other
18.4
%
17.5
%
17.9
%
17.2
%
Franchise contributions for advertising
and other services
17.9
%
15.8
%
18.0
%
16.8
%
100.0
%
100.0
%
100.0
%
100.0
%
Operating costs and expenses, net:
Food and packaging (1)
27.8
%
29.9
%
28.1
%
29.8
%
Payroll and employee benefits (1)
30.8
%
32.6
%
30.6
%
31.2
%
Occupancy and other (1)
15.5
%
16.9
%
15.6
%
15.9
%
Franchise occupancy expenses (2)
62.8
%
69.2
%
62.8
%
68.0
%
Franchise support and other costs (3)
7.1
%
7.9
%
6.2
%
8.5
%
Franchise advertising and other services
expenses (4)
102.1
%
104.7
%
102.6
%
103.5
%
Selling, general and administrative
expenses
7.3
%
11.2
%
6.6
%
10.0
%
Depreciation and amortization
4.2
%
5.7
%
4.2
%
5.5
%
Impairment and other charges (gains),
net
0.5
%
0.3
%
0.1
%
(1.6
)%
Gains on the sale of company-operated
restaurants
(0.6
)%
—
%
(0.5
)%
(0.3
)%
Earnings from operations
25.2
%
15.2
%
25.8
%
19.6
%
Income tax rate (5)
27.3
%
32.3
%
26.1
%
30.7
%
____________________________
(1)
As a percentage of company restaurant
sales.
(2)
As a percentage of franchise rental
revenues.
(3)
As a percentage of franchise royalties and
other.
(4)
As a percentage of franchise contributions
for advertising and other services.
(5)
As a percentage of earnings before income
taxes.
Jack in the Box system sales (in thousands):
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Company-owned restaurant sales
$
85,962
$
74,380
$
200,240
$
179,744
Franchised restaurant sales (1)
847,363
695,926
1,963,189
1,675,271
System sales (1)
$
933,325
$
770,306
$
2,163,429
$
1,855,015
____________________________
(1)
Franchised restaurant sales represent
sales at franchised restaurants and are revenues of our
franchisees. System sales include company and franchised restaurant
sales. We do not record franchised sales as revenues; however, our
royalty revenues, marketing fees and percentage rent revenues are
calculated based on a percentage of franchised sales. We believe
franchised and system restaurant sales information is useful to
investors as they have a direct effect on the company's
profitability.
The following table summarizes the year-to-date changes in the
number and mix of Jack in the Box company and franchise
restaurants:
SUPPLEMENTAL RESTAURANT
ACTIVITY INFORMATION
(Unaudited)
2021
2020
Company
Franchise
Total
Company
Franchise
Total
Beginning of year
144
2,097
2,241
137
2,106
2,243
New
—
6
6
—
16
16
Acquired from franchisees
4
(4
)
—
8
(8
)
—
Closed
—
(19
)
(19
)
(1
)
(12
)
(13
)
End of period
148
2,080
2,228
144
2,102
2,246
% of system
7
%
93
%
100
%
6
%
94
%
100
%
JACK IN THE BOX INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASUREMENTS TO GAAP RESULTS
(Unaudited)
To supplement the consolidated financial statements, which are
presented in accordance with GAAP, the company uses the following
non-GAAP measures: Operating Earnings Per Share, Adjusted EBITDA,
Restaurant-Level Margin and Franchise-Level Margin. Management
believes that these measurements, when viewed with the company's
results of operations in accordance with GAAP and the accompanying
reconciliations in the tables below, provide useful information
about operating performance and period-over-period changes, and
provide additional information that is useful for evaluating the
operating performance of the company's core business without regard
to potential distortions.
Operating Earnings Per Share
Operating Earnings Per Share represents diluted earnings per
share on a GAAP basis excluding gains or losses on the sale of
company-operated restaurants, restructuring charges, the gain on
sale of corporate office building, pension settlement charges, and
the excess tax benefit from share-based compensation arrangements.
Operating Earnings Per Share should be considered as a supplement
to, not as a substitute for, analysis of results as reported under
U.S. GAAP or other similarly titled measures of other companies.
Management believes Operating Earnings Per Share provides investors
with a meaningful supplement of the company’s operating performance
and period-over-period changes without regard to potential
distortions.
Below is a reconciliation of non-GAAP Operating Earnings Per
Share to the most directly comparable GAAP measure, diluted
earnings per share. Figures may not add due to rounding.
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Diluted earnings per share – GAAP
$
1.58
$
0.50
$
3.78
$
0.82
Gains on the sale of company-operated
restaurants
(0.05)
—
(0.09)
(0.05)
Excess tax benefits from share-based
compensation arrangements
(0.05)
(0.01)
(0.05)
—
Pension settlement charges
—
0.01
—
1.14
Gain on sale of corporate office
building
—
—
—
(0.32)
Restructuring charges
—
—
—
0.03
Operating Earnings Per Share – non-GAAP
(1)
$
1.48
$
0.50
$
3.64
$
1.62
____________________
(1)
Operating Earnings Per Share may not add
due to rounding.
Adjusted EBITDA
Adjusted EBITDA represents net earnings on a GAAP basis
excluding income taxes, interest expense, net, gains or losses on
the sale of company-operated restaurants, impairment and other
charges (gains), net, depreciation and amortization, the
amortization of franchise tenant improvement allowances and other,
and pension settlement charges. Adjusted EBITDA should be
considered as a supplement to, not as a substitute for, analysis of
results as reported under U.S. GAAP or other similarly titled
measures of other companies. Management believes Adjusted EBITDA is
useful to investors to gain an understanding of the factors and
trends affecting the company's ongoing cash earnings, from which
capital investments are made and debt is serviced.
Below is a reconciliation of non-GAAP Adjusted EBITDA to the
most directly comparable GAAP measure, net earnings (in
thousands).
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Net earnings - GAAP
$
35,934
$
11,463
$
86,793
$
19,360
Income tax expense
13,524
5,458
30,585
8,591
Interest expense, net
15,227
15,409
35,962
35,351
Pension settlement charges
—
321
—
38,927
Gains on the sale of company-operated
restaurants
(1,532
)
—
(2,815
)
(1,575
)
Impairment and other charges (gains),
net
1,228
716
776
(8,575
)
Depreciation and amortization
10,696
12,282
25,267
29,010
Amortization of franchise tenant
improvement allowances and other
673
614
1,534
1,765
Adjusted EBITDA - Non-GAAP
$
75,750
$
46,263
$
178,102
$
122,854
Restaurant-Level Margin
Restaurant-Level Margin is defined as company restaurant sales
less restaurant operating costs (food and packaging, labor, and
occupancy costs) and is neither required by, nor presented in
accordance with GAAP. Restaurant-Level Margin excludes revenues and
expenses of our franchise operations and certain costs, such as
selling, general, and administrative expenses, depreciation and
amortization, impairment and other charges (gains), net, gains or
losses on the sale of company-operated restaurants, and other costs
that are considered normal operating costs. As such,
Restaurant-Level Margin is not indicative of the overall results of
the company and does not accrue directly to the benefit of
shareholders because of the exclusion of corporate-level expenses.
Restaurant-Level Margin should be considered as a supplement to,
not as a substitute for, analysis of results as reported under GAAP
or other similarly titled measures of other companies. The company
is presenting Restaurant-Level Margin because it believes that it
provides a meaningful supplement to net earnings of the company's
core business operating results, as well as a comparison to those
of other similar companies. Management utilizes Restaurant-Level
Margin as a key performance indicator to evaluate the profitability
of company-owned restaurants.
Below is a reconciliation of non-GAAP Restaurant-Level Margin to
the most directly comparable GAAP measure, earnings from operations
(in thousands):
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Earnings from operations - GAAP
$
64,888
$
32,842
$
153,814
$
102,792
Franchise rental revenues
(77,901
)
(69,885
)
(181,650
)
(165,969
)
Franchise royalties and other
(47,231
)
(37,764
)
(106,879
)
(90,230
)
Franchise contributions for advertising
and other services
(46,123
)
(34,128
)
(106,989
)
(87,887
)
Franchise occupancy expenses
48,904
48,341
114,073
112,858
Franchise support and other costs
3,341
2,971
6,614
7,647
Franchise advertising and other services
expenses
47,104
35,734
109,799
90,958
Selling, general and administrative
expenses
18,861
24,203
39,360
52,451
Impairment and other charges (gains),
net
1,228
716
776
(8,575
)
Gains on the sale of company-operated
restaurants
(1,532
)
—
(2,815
)
(1,575
)
Depreciation and amortization
10,696
12,282
25,267
29,010
Restaurant-Level Margin- Non-GAAP
$
22,235
$
15,312
$
51,370
$
41,480
Company restaurant sales
$
85,962
$
74,380
$
200,240
$
179,744
Restaurant-Level Margin % - Non-GAAP
25.9
%
20.6
%
25.7
%
23.1
%
Franchise-Level Margin
Franchise-Level Margin is defined as franchise revenues less
franchise operating costs (occupancy expenses, advertising
contributions, and franchise support and other costs) and is
neither required by, nor presented in accordance with GAAP.
Franchise-Level Margin excludes revenue and expenses of our
company-operated restaurants and certain costs, such as selling,
general, and administrative expenses, depreciation and
amortization, impairment and other charges (gains), net, and other
costs that are considered normal operating costs. As such,
Franchise-Level Margin is not indicative of the overall results of
the company and does not accrue directly to the benefit of
shareholders because of the exclusion of corporate-level expenses.
Franchise-Level Margin should be considered as a supplement to, not
as a substitute for, analysis of results as reported under GAAP or
other similarly titled measures of other companies. The company is
presenting Franchise-Level Margin because it believes that it
provides a meaningful supplement to net earnings of the company's
core business operating results, as well as a comparison to those
of other similar companies. Management utilizes Franchise-Level
Margin as a key performance indicator to evaluate the profitability
of our franchise operations.
Below is a reconciliation of non-GAAP Franchise-Level Margin to
the most directly comparable GAAP measure, earnings from operations
(in thousands):
12 Weeks Ended
28 Weeks Ended
April 11, 2021
April 12, 2020
April 11, 2021
April 12, 2020
Earnings from operations - GAAP
$
64,888
$
32,842
$
153,814
$
102,792
Company restaurant sales
(85,962
)
(74,380
)
(200,240
)
(179,744
)
Food and packaging
23,938
22,237
56,315
53,585
Payroll and employee benefits
26,440
24,261
61,371
56,151
Occupancy and other
13,349
12,570
31,184
28,528
Selling, general and administrative
expenses
18,861
24,203
39,360
52,451
Impairment and other charges (gains),
net
1,228
716
776
(8,575
)
Gains on the sale of company-operated
restaurants
(1,532
)
—
(2,815
)
(1,575
)
Depreciation and amortization
10,696
12,282
25,267
29,010
Franchise-Level Margin - Non-GAAP
$
71,906
$
54,731
$
165,032
$
132,623
Franchise rental revenues
$
77,901
$
69,885
$
181,650
$
165,969
Franchise royalties and other
47,231
37,764
106,879
90,230
Franchise contributions for advertising
and other services
46,123
34,128
106,989
87,887
Total franchise revenues
$
171,255
$
141,777
$
395,518
$
344,086
Franchise-Level Margin % - Non-GAAP
42.0
%
38.6
%
41.7
%
38.5
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210512005312/en/
Investor Contact: Maria Hocut
Maria.Hocut@jackinthebox.com
Jack in the Box (NASDAQ:JACK)
Historical Stock Chart
From Aug 2024 to Sep 2024
Jack in the Box (NASDAQ:JACK)
Historical Stock Chart
From Sep 2023 to Sep 2024