DALLAS, Aug. 24,
2022 /PRNewswire/ -- Brinker International, Inc.
(NYSE: EAT) today announced results for the fourth quarter of
fiscal 2022 ended June 29, 2022 and
provided a financial outlook for fiscal 2023.
"During my first sixty days I've spent considerable time in
restaurants with our operators, exchanging ideas on how to make our
operations more efficient, improve the guest experience, and grow
the core business," said Kevin
Hochman, Chief Executive Officer and President of Brinker
International. "We're making quick interventions to better offset
the tough inflationary headwinds and build sales momentum in the
near term, as we work to meaningfully improve our four-wall
economics and better position our business for long term
sustainable and profitable growth."
Fiscal 2022 Highlights
- Fourth Quarter
- Brinker International reported Company sales of $987.4 million in the fourth quarter of fiscal
2022 as compared to $990.9 million in
the fourth quarter of fiscal 2021. In fiscal 2021, the fourth
quarter and fiscal year included an additional operating week
resulting in an increase of approximately $70 million to Total revenues and $0.34 to Net income per diluted share.
- Operating income in the fourth quarter of fiscal 2022 was
$44.7 million as compared to
$100.6 million in the fourth quarter
of fiscal 2021. Operating income, as a percentage of Total
revenues, in the fourth quarter of fiscal 2022 was 4.4% as compared
to 10.0% in the fourth quarter of fiscal 2021. This decrease was
primarily due to higher commodity costs, restaurant expenses, the
impact of the additional operating week in fiscal 2021 and
increased restaurant labor costs.
- Restaurant operating margin, as a percentage of Company sales,
in the fourth quarter of fiscal 2022 was 10.3% as compared to 16.9%
in the fourth quarter of fiscal 2021.
- Net income per diluted share, on a GAAP basis, in the fourth
quarter of fiscal 2022 was $0.90 as
compared to $1.58 in the fourth
quarter of fiscal 2021 including the impact of the additional
operating week.
- Net income per diluted share, excluding special items, in the
fourth quarter of fiscal 2022 was $1.15 as compared to $1.68 in the fourth quarter of fiscal 2021
including the impact of the additional operating week.
- Adjusted EBITDA in the fourth quarter of fiscal 2022 was
$100.2 million as compared to
$144.3 million in the fourth quarter
of fiscal 2021.
For comparable restaurant sales details and non-GAAP
reconciliations, please refer to the Non-GAAP Information and
Reconciliations section of this release.
Comparable Restaurant
Sales(1)
|
Q4:22 vs
21
|
|
FY:22 vs
21
|
Brinker
|
3.1 %
|
|
12.3 %
|
Chili's
|
0.3 %
|
|
8.6 %
|
Maggiano's
|
30.1 %
|
|
53.0 %
|
|
|
(1)
|
Comparable Restaurant
Sales include restaurants that have been in operation for more than
18 months. Restaurants temporarily closed 14 days or more are
excluded from comparable restaurant sales. Percentage amounts are
calculated based on the comparable periods
year-over-year.
|
|
|
Average Weekly
Sales
The following table consists of average weekly Company sales per
restaurant for all Company-owned restaurants. The amounts are
presented in thousands:
|
Fourth
Quarter
|
|
2022
|
|
2021
|
|
2020
|
|
2019
|
Brinker
|
$
64.0
|
|
$
63.3
|
|
$
38.4
|
|
$
61.9
|
Chili's
|
$
59.5
|
|
$
60.3
|
|
$
37.8
|
|
$
56.9
|
Maggiano's
|
$
163.6
|
|
$
126.2
|
|
$
50.7
|
|
$
152.4
|
Financial Metrics
|
Fourth
Quarter
|
|
Fiscal
Year
|
|
2022
|
|
2021
|
|
Variance
|
|
2022
|
|
2021
|
|
Variance
|
Company
sales
|
$
987.4
|
|
$
990.9
|
|
$
(3.5)
|
|
$ 3,712.1
|
|
$ 3,279.0
|
|
$
433.1
|
Total
revenues
|
$ 1,021.5
|
|
$ 1,008.6
|
|
$ 12.9
|
|
$ 3,804.1
|
|
$ 3,337.8
|
|
$
466.3
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$ 44.7
|
|
$
100.6
|
|
$ (55.9)
|
|
$
159.5
|
|
$
199.3
|
|
$ (39.8)
|
Operating income as a
percentage of Total
revenues
|
4.4 %
|
|
10.0 %
|
|
(5.6) %
|
|
4.2 %
|
|
6.0 %
|
|
(1.8) %
|
Restaurant operating
margin, non-GAAP(1)
|
$
101.4
|
|
$
167.2
|
|
$ (65.8)
|
|
$
407.2
|
|
$
444.5
|
|
$ (37.3)
|
Restaurant operating
margin as a percentage
of Company sales, non-GAAP(1)
|
10.3 %
|
|
16.9 %
|
|
(6.6) %
|
|
11.0 %
|
|
13.6 %
|
|
(2.6) %
|
Adjusted EBITDA,
non-GAAP(1)
|
$
100.2
|
|
$
144.3
|
|
$ (44.1)
|
|
$
355.1
|
|
$
368.5
|
|
$ (13.4)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per diluted
share
|
$ 0.90
|
|
$ 1.58
|
|
$ (0.68)
|
|
$ 2.58
|
|
$ 2.83
|
|
$ (0.25)
|
Net income per diluted
share, excluding
special items, non-GAAP(1)
|
$ 1.15
|
|
$ 1.68
|
|
$ (0.53)
|
|
$ 3.09
|
|
$ 3.12
|
|
$ (0.03)
|
|
|
(1)
|
See Non-GAAP
Information and Reconciliations section below for more
details.
|
|
|
Full Year Fiscal 2023
Guidance
We anticipate the following for fiscal 2023. The uncertainties
created by current macroeconomic conditions could cause actual
results to differ materially from those projected.
- Total revenues are expected to be in the range of $3.9 - $4.0
billion;
- Net income per diluted share, excluding special items, is
expected to be in the range of $2.45
- $2.85;
- Capital expenditures are expected to be in the range of
$155 - $165
million;
- Weighted average shares are expected to be in the range of 44 -
45 million.
We are unable to reliably forecast special items without
unreasonable effort. As such, we do not present a reconciliation of
forecasted non-GAAP measures to the corresponding GAAP
measures.
Fourth Quarter of
Fiscal 2022 Operating Performance
Segment Performance
The table below presents selected financial information (in
millions, except as noted) related to our segments' operational
performance for the thirteen week period ended June 29, 2022
and the fourteen week period ended June 30, 2021:
|
Chili's
|
|
Maggiano's
|
|
Fourth
Quarter
|
|
Variance
|
|
Fourth
Quarter
|
|
Variance
|
|
2022
|
|
2021
|
|
|
2022
|
|
2021
|
|
Company
sales
|
$ 876.9
|
|
$ 898.7
|
|
$ (21.8)
|
|
$ 110.5
|
|
$ 92.2
|
|
$ 18.3
|
Franchise and other
revenues
|
27.3
|
|
15.3
|
|
12.0
|
|
6.8
|
|
2.4
|
|
4.4
|
Total
revenues
|
$ 904.2
|
|
$ 914.0
|
|
$
(9.8)
|
|
$ 117.3
|
|
$ 94.6
|
|
$ 22.7
|
|
|
|
|
|
|
|
|
|
|
|
|
Company restaurant
expenses(1)
|
$ 787.5
|
|
$ 745.2
|
|
$ 42.3
|
|
$ 98.4
|
|
$ 78.4
|
|
$ 20.0
|
Company restaurant
expenses as a % of
Company sales
|
89.8 %
|
|
82.9 %
|
|
6.9 %
|
|
89.0 %
|
|
85.0 %
|
|
4.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
$ 59.5
|
|
$ 125.7
|
|
$ (66.2)
|
|
$ 14.1
|
|
$ 10.7
|
|
$
3.4
|
Operating income (loss)
as a % of Total
revenues
|
6.6 %
|
|
13.8 %
|
|
(7.2) %
|
|
12.0 %
|
|
11.3 %
|
|
0.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Restaurant operating
margin - non-
GAAP(2)
|
$ 89.4
|
|
$ 153.5
|
|
$ (64.1)
|
|
$ 12.1
|
|
$ 13.8
|
|
$
(1.7)
|
Restaurant operating
margin as a % of
Company sales - non-GAAP(2)
|
10.2 %
|
|
17.1 %
|
|
(6.9) %
|
|
11.0 %
|
|
15.0 %
|
|
(4.0) %
|
|
|
(1)
|
Company restaurant
expenses includes Food and beverage costs, Restaurant labor and
Restaurant expenses, and excludes Depreciation and amortization,
General and administrative and Other (gains) and
charges.
|
(2)
|
See Non-GAAP
Information and Reconciliations section below for more
details.
|
|
|
Chili's
- Chili's Company sales decreased primarily due to the impact of
the additional operating week in the prior year and lower To-Go
sales, partially offset by dining room sales growth, the
acquisition of 68 restaurants in fiscal 2022 previously owned by
franchisees and higher delivery sales.
- Chili's Franchise and other revenues increased primarily due to
incremental gift card breakage resulting from a change in
estimate.
- Chili's Company restaurant expenses, as a percentage of Company
sales, increased primarily due to higher commodity costs, sales
deleverage, advertising, utilities expenses, rent expenses and
increased restaurant labor costs including wage rates. These
increases were partially offset by lower manager bonuses.
Maggiano's
- Maggiano's Company sales increased primarily due to higher
dining room and banquet sales, partially offset by the impact of
the additional operating week in the prior year.
- Maggiano's Company restaurant expenses, as a percentage of
Company sales, increased primarily due to higher commodity costs,
restaurant labor costs, manager bonuses and supervision
expenses.
Income Taxes
- On a GAAP basis, the effective income tax rate was a benefit of
18.2% in the fourth quarter of fiscal 2022 which is lower than the
statutory rate of 21.0% due to leverage of the FICA tip tax credit.
Excluding the impact of special items, the effective income tax
rate was a benefit of 5.8% in the fourth quarter of fiscal
2022.
Webcast Information
Investors and interested parties are invited to listen to
today's conference call, as management will provide further details
of the quarter and business updates. The call will be broadcast
live on Brinker's website today, August 24, 2022 at
9 a.m. CDT:
http://investors.brinker.com/events/event-details/q4-2022-brinker-international-earnings-conference-call
For those who are unable to listen to the live broadcast, a
replay of the call will be available shortly thereafter and will
remain on Brinker's website until at least the end of the day
September 7, 2022.
Additional financial information, including statements of income
which detail operations excluding special items, franchise and
other revenues, and comparable restaurant sales trends by brand, is
also available on Brinker's website under the Financial Information
section of the Investor tab.
Forward Calendar
- SEC Form 10-K for the fiscal 2022 filing on or before
August 29, 2022
- Earnings release call for the first quarter of fiscal 2023 on
November 2, 2022
Non-GAAP Measures
Brinker management uses certain non-GAAP measures in analyzing
operating performance and believes that the presentation of these
measures in this release provides investors with information that
is beneficial to gaining an understanding of the Company's
financial results. Non-GAAP disclosures should not be viewed as a
substitute for financial results determined in accordance with
GAAP, nor are they necessarily comparable to non-GAAP performance
measures that may be presented by other companies. Reconciliations
of these non-GAAP measures are included in the tables below.
About Brinker
Brinker International, Inc. is one of the world's leading
casual dining restaurant companies and home of Chili's®
Grill & Bar, Maggiano's Little Italy® and two
virtual brands: It's Just
Wings® and Maggiano's Italian Classics™. Founded
by Norman Brinker in Dallas, Texas, we've ventured far from home,
but stayed true to our roots. Brinker owns, operates or franchises
more than 1,600 restaurants in 29 countries and two U.S.
territories. Our passion is making people feel special, and we hope
you feel that passion each time you visit one of our restaurants or
invite us into your home through takeout or delivery. Learn more
about Brinker and its brands at brinker.com.
Forward-Looking
Statements
The statements and tables contained in this release that are not
historical facts are forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. We intend all forward-looking
statements to be covered by the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. All
forward-looking statements are made only based on our current plans
and expectations as of the date such statements are made, and we
undertake no obligation to update forward-looking statements to
reflect events or circumstances arising after the date such
statements are made. Forward-looking statements are neither
predictions nor guarantees of future events or performance and are
subject to risks and uncertainties which could cause actual results
to differ materially from our historical results or from those
projected in forward-looking statements. Such risks and
uncertainties include, among other things, the impact of general
economic conditions, including inflation, on economic activity and
on our operations; the impact of the COVID-19 pandemic, the crisis
in Ukraine and related disruptions
on our business including consumer demand, costs, product mix, our
strategic initiatives, our and our partners' supply chains,
operations, technology and assets, and our financial performance;
the impact of competition; changes in consumer preferences;
consumer perception of food safety; reduced consumer discretionary
spending; unfavorable publicity; governmental regulations; the
Company's ability to meet its business strategy plan; loss of key
management personnel; failure to hire and retain high-quality
restaurant management and team members; the impact of social media
or other unfavorable publicity; reliance on technology and third
party delivery providers; failure to protect the security of data
of our guests and team members; product availability and supply
chain disruptions; regional business and economic conditions;
volatility in consumer, commodity, transportation, labor, currency
and capital markets; litigation; franchisee success; technology
failures; failure to protect our intellectual property;
outsourcing; impairment of goodwill or assets; failure to maintain
effective internal control over financial reporting; downgrades in
credit ratings; changes in estimates regarding our assets; actions
of activist shareholders; adverse weather conditions; terrorist
acts; health epidemics or pandemics (such as COVID-19); and tax
reform; as well as the risks and uncertainties described in "Risk
Factors" in our Annual Report on Form 10-K and future filings with
the Securities and Exchange Commission.
BRINKER INTERNATIONAL, INC.
|
Consolidated
Statements of Comprehensive Income (Unaudited)
|
(In millions, except
per share amounts)
|
|
|
Thirteen Week
Period Ended
|
|
Fourteen Week
Period Ended
|
|
Fifty-Two Week
Period Ended
|
|
Fifty-Three Week
Period Ended
|
|
June 29,
2022
|
|
June 30,
2021
|
|
June 29,
2022
|
|
June 30,
2021
|
Revenues
|
|
|
|
|
|
|
|
Company
sales
|
$
987.4
|
|
$
990.9
|
|
$
3,712.1
|
|
$
3,279.0
|
Franchise and other
revenues(1)
|
34.1
|
|
17.7
|
|
92.0
|
|
58.8
|
Total
revenues
|
1,021.5
|
|
1,008.6
|
|
3,804.1
|
|
3,337.8
|
Operating costs and
expenses
|
|
|
|
|
|
|
|
Food and beverage
costs
|
291.1
|
|
261.5
|
|
1,048.5
|
|
867.8
|
Restaurant
labor
|
338.7
|
|
333.6
|
|
1,288.1
|
|
1,108.2
|
Restaurant
expenses
|
256.2
|
|
228.6
|
|
968.3
|
|
858.5
|
Depreciation and
amortization
|
41.3
|
|
38.2
|
|
164.4
|
|
150.2
|
General and
administrative
|
35.3
|
|
40.6
|
|
144.1
|
|
134.8
|
Other (gains) and
charges(2)
|
14.2
|
|
5.5
|
|
31.2
|
|
19.0
|
Total operating costs
and expenses
|
976.8
|
|
908.0
|
|
3,644.6
|
|
3,138.5
|
Operating
income
|
44.7
|
|
100.6
|
|
159.5
|
|
199.3
|
Interest
expenses
|
11.3
|
|
13.1
|
|
46.1
|
|
56.2
|
Other income,
net
|
(0.6)
|
|
(0.9)
|
|
(1.8)
|
|
(2.1)
|
Income before income
taxes
|
34.0
|
|
88.4
|
|
115.2
|
|
145.2
|
Provision (benefit) for
income taxes
|
(6.2)
|
|
13.4
|
|
(2.4)
|
|
13.6
|
Net income
|
$
40.2
|
|
$
75.0
|
|
$
117.6
|
|
$
131.6
|
|
|
|
|
|
|
|
|
Basic net income per
share
|
$
0.92
|
|
$
1.64
|
|
$
2.62
|
|
$
2.89
|
|
|
|
|
|
|
|
|
Diluted net income per
share
|
$
0.90
|
|
$
1.58
|
|
$
2.58
|
|
$
2.83
|
|
|
|
|
|
|
|
|
Basic weighted average
shares outstanding
|
43.8
|
|
45.8
|
|
44.8
|
|
45.5
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
44.6
|
|
47.6
|
|
45.6
|
|
46.6
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments(3)
|
$
(0.5)
|
|
$
0.4
|
|
$
(0.6)
|
|
$
1.5
|
Other comprehensive
income (loss)
|
(0.5)
|
|
0.4
|
|
(0.6)
|
|
1.5
|
Comprehensive
income
|
$
39.7
|
|
$
75.4
|
|
$
117.0
|
|
$
133.1
|
|
|
(1)
|
Franchise and other
revenues include franchise gift card breakage, royalties,
Maggiano's banquet service charge income, delivery income, digital
entertainment revenue, franchise and development fees, gift card
equalization, franchise advertising fees, merchandise income and
gift card discount costs from third-party gift card
sales.
|
(2)
|
Other (gains) and
charges included in the Consolidated Statements of Comprehensive
Income (Unaudited) included (in millions):
|
|
Thirteen Week
Period Ended
|
|
Fourteen Week
Period Ended
|
|
Fifty-Two Week
Period Ended
|
|
Fifty-Three Week
Period Ended
|
|
June 29,
2022
|
|
June 30,
2021
|
|
June 29,
2022
|
|
June 30,
2021
|
Restaurant impairment
charges
|
$
8.3
|
|
$
0.5
|
|
$
8.3
|
|
$
3.0
|
Restaurant closure
charges
|
2.0
|
|
0.2
|
|
3.7
|
|
2.4
|
Enterprise system
implementation costs
|
1.0
|
|
—
|
|
2.4
|
|
—
|
Remodel-related
costs
|
0.9
|
|
0.5
|
|
4.9
|
|
2.3
|
COVID-19 related
charges
|
0.3
|
|
0.2
|
|
0.5
|
|
3.3
|
Loss from natural
disasters, net of (insurance recoveries)
|
0.3
|
|
0.9
|
|
1.1
|
|
2.9
|
Lease
contingencies
|
0.2
|
|
2.2
|
|
3.1
|
|
2.2
|
Acquisition-related
costs, net
|
0.1
|
|
—
|
|
1.6
|
|
—
|
Other
|
1.1
|
|
1.0
|
|
5.6
|
|
2.9
|
|
$
14.2
|
|
$
5.5
|
|
$
31.2
|
|
$
19.0
|
(3)
|
Represents the
unrealized impact of translating the financial statements of our
Canadian restaurants from Canadian dollars to U.S. dollars. This
amount is not included in Net income and would only be realized
upon disposition of these restaurants.
|
BRINKER INTERNATIONAL, INC.
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
(In
millions)
|
|
|
June 29,
2022
|
|
June 30,
2021
|
ASSETS
|
|
|
|
Total current
assets
|
$
201.2
|
|
$
207.2
|
Net property and
equipment
|
816.7
|
|
774.8
|
Operating lease
assets
|
1,160.5
|
|
1,007.4
|
Deferred income taxes,
net
|
62.5
|
|
50.9
|
Other
assets
|
243.5
|
|
234.6
|
Total
assets
|
$
2,484.4
|
|
$
2,274.9
|
LIABILITIES AND
SHAREHOLDERS' DEFICIT
|
|
|
|
Total current
liabilities
|
$
558.0
|
|
$
571.6
|
Long-term debt and
finance leases, less current installments
|
989.1
|
|
917.9
|
Long-term operating
lease liabilities, less current portion
|
1,151.1
|
|
1,006.7
|
Other
liabilities
|
54.3
|
|
82.0
|
Total shareholders'
deficit
|
(268.1)
|
|
(303.3)
|
Total liabilities and
shareholders' deficit
|
$
2,484.4
|
|
$
2,274.9
|
BRINKER INTERNATIONAL, INC.
|
Condensed Consolidated Statements of
Cash Flows (Unaudited)
|
(In
millions)
|
|
|
Fifty-Two Week
Period Ended
|
|
Fifty-Three Week
Period Ended
|
|
June 29,
2022
|
|
June 30,
2021
|
Cash flows from
operating activities
|
|
|
|
Net income
|
$
117.6
|
|
$
131.6
|
Adjustments to
reconcile Net income to Net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
164.4
|
|
150.2
|
Restructure and
impairment charges
|
20.3
|
|
9.8
|
Stock-based
compensation
|
18.6
|
|
16.4
|
Net loss on disposal
of assets
|
3.4
|
|
1.8
|
Other
|
3.0
|
|
3.7
|
Changes in assets and
liabilities
|
(75.1)
|
|
56.2
|
Net cash provided by
operating activities
|
252.2
|
|
369.7
|
Cash flows from
investing activities
|
|
|
|
Payments for property
and equipment
|
(150.3)
|
|
(94.0)
|
Payments for franchise
restaurant acquisitions
|
(106.6)
|
|
—
|
Proceeds from sale
leaseback transactions, net of related expenses
|
20.5
|
|
—
|
Proceeds from note
receivable
|
2.1
|
|
1.5
|
Proceeds from sale of
assets
|
0.1
|
|
1.6
|
Net cash used in
investing activities
|
(234.2)
|
|
(90.9)
|
Cash flows from
financing activities
|
|
|
|
Borrowings on
revolving credit facility
|
720.5
|
|
43.4
|
Payments on revolving
credit facility
|
(620.5)
|
|
(345.0)
|
Purchases of treasury
stock
|
(100.9)
|
|
(4.2)
|
Payments on long-term
debt
|
(23.7)
|
|
(20.0)
|
Payments for debt
issuance costs
|
(3.1)
|
|
(2.2)
|
Payments of
dividends
|
(1.1)
|
|
(1.5)
|
Proceeds from issuance
of treasury stock
|
0.4
|
|
30.7
|
Net cash used in
financing activities
|
(28.4)
|
|
(298.8)
|
Net change in cash and
cash equivalents
|
(10.4)
|
|
(20.0)
|
Cash and cash
equivalents at beginning of period
|
23.9
|
|
43.9
|
Cash and cash
equivalents at end of period
|
$
13.5
|
|
$
23.9
|
BRINKER INTERNATIONAL, INC.
|
Restaurant Summary
|
|
|
|
|
|
|
|
Fiscal 2022 New
Openings
|
|
Total Restaurants
Open
at June 29, 2022
|
|
Total Restaurants
Open
at June 30, 2021
|
|
|
Fourth Quarter
Openings
|
|
Fiscal Year
Openings
|
Company-owned
restaurants
|
|
|
|
|
|
|
|
|
Chili's
domestic(1)
|
1,131
|
|
1,064
|
|
|
2
|
|
5
|
Chili's
international
|
5
|
|
5
|
|
|
—
|
|
—
|
Maggiano's
domestic
|
52
|
|
52
|
|
|
—
|
|
—
|
Total
Company-owned
|
1,188
|
|
1,121
|
|
|
2
|
|
5
|
Franchise
restaurants
|
|
|
|
|
|
|
|
|
Chili's
domestic(1)
|
101
|
|
171
|
|
|
1
|
|
2
|
Chili's
international
|
359
|
|
354
|
|
|
3
|
|
12
|
Maggiano's
domestic
|
2
|
|
2
|
|
|
—
|
|
—
|
Total
franchise
|
462
|
|
527
|
|
|
4
|
|
14
|
Total Company-owned and
franchise
|
|
|
|
|
|
|
|
|
Chili's
domestic
|
1,232
|
|
1,235
|
|
|
3
|
|
7
|
Chili's
international
|
364
|
|
359
|
|
|
3
|
|
12
|
Maggiano's
domestic
|
54
|
|
54
|
|
|
—
|
|
—
|
Total
|
1,650
|
|
1,648
|
|
|
6
|
|
19
|
|
|
(1)
|
During fiscal 2022, we
acquired 68 Chili's restaurants previously owned by franchisees.
The acquisition of these restaurants is not reflected in the Fourth
Quarter Openings or Full Year Openings totals as these are existing
restaurant locations transitioning ownership. These acquired
restaurants are included in the total restaurants open at June 29,
2022 within the total for Company-owned restaurants Chili's
domestic.
|
NON-GAAP INFORMATION
AND RECONCILIATIONS
|
Comparable
Restaurant Sales
|
Q4
22 and Q4 21
|
|
|
Comparable
Restaurant Sales(1)
|
|
Price
Impact
|
|
Mix-Shift(2)
|
|
Traffic
|
|
Q4:22 vs
21
|
|
Q4:21 vs
20
|
|
Q4:22 vs
21
|
|
Q4:21 vs
20
|
|
Q4:22 vs
21
|
|
Q4:21 vs
20
|
|
Q4:22 vs
21
|
|
Q4:21 vs
20
|
Company-owned
|
3.1 %
|
|
65.4 %
|
|
5.2 %
|
|
0.3 %
|
|
2.3 %
|
|
12.5 %
|
|
(4.4) %
|
|
52.6 %
|
Chili's
|
0.3 %
|
|
59.8 %
|
|
5.2 %
|
|
0.2 %
|
|
0.8 %
|
|
8.4 %
|
|
(5.7) %
|
|
51.2 %
|
Maggiano's
|
30.1 %
|
|
147.9 %
|
|
5.1 %
|
|
1.5 %
|
|
7.1 %
|
|
64.7 %
|
|
17.9 %
|
|
81.7 %
|
Franchise(3)
|
17.4 %
|
|
104.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
|
2.0 %
|
|
84.9 %
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
28.7 %
|
|
159.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Chili's
domestic(4)
|
0.1 %
|
|
62.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
System-wide(5)
|
5.2 %
|
|
69.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FY 22 and FY 21
|
|
|
Comparable
Restaurant Sales(1)
|
|
Price
Impact
|
|
Mix-Shift(2)
|
|
Traffic
|
|
FY:22 vs
21
|
|
FY:21 vs
20
|
|
FY:22 vs
21
|
|
FY:21 vs
20
|
|
FY:22 vs
21
|
|
FY:21 vs
20
|
|
FY:22 vs
21
|
|
FY:21 vs
20
|
Company-owned
|
12.3 %
|
|
5.1 %
|
|
3.3 %
|
|
0.6 %
|
|
4.7 %
|
|
(4.3) %
|
|
4.3 %
|
|
8.8 %
|
Chili's
|
8.6 %
|
|
8.3 %
|
|
3.3 %
|
|
0.4 %
|
|
2.6 %
|
|
(2.6) %
|
|
2.7 %
|
|
10.5 %
|
Maggiano's
|
53.0 %
|
|
(19.8) %
|
|
2.9 %
|
|
2.3 %
|
|
16.4 %
|
|
(7.7) %
|
|
33.7 %
|
|
(14.4) %
|
Franchise(3)
|
19.2 %
|
|
12.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
|
7.5 %
|
|
13.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
28.9 %
|
|
9.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Chili's
domestic(4)
|
8.3 %
|
|
8.9 %
|
|
|
|
|
|
|
|
|
|
|
|
|
System-wide(5)
|
13.2 %
|
|
6.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Comparable Restaurant
Sales include all restaurants that have been in operation for more
than 18 months. Restaurants temporarily closed 14 days or more are
excluded from Comparable Restaurant Sales. Percentage amounts are
calculated based on the comparable periods
year-over-year.
|
(2)
|
Mix-Shift is calculated
as the year-over-year percentage change in Company sales resulting
from the change in menu items ordered by guests.
|
(3)
|
Chili's and Maggiano's
franchise sales generated by franchisees are not included in Total
revenues in the Consolidated Statements of Comprehensive Income
(Unaudited); however, we generate royalty revenues and advertising
fees based on franchisee revenues, where applicable. We believe
presenting Franchise Comparable Restaurant Sales provides investors
relevant information regarding total brand performance.
|
(4)
|
Chili's domestic
Comparable Restaurant Sales percentages are derived from sales
generated by Company-owned and franchise-operated Chili's
restaurants in the United States.
|
(5)
|
System-wide Comparable
Restaurant Sales are derived from sales generated by Chili's and
Maggiano's Company-owned and franchise-operated
restaurants.
|
Reconciliation of
Net Income Excluding Special Items (in millions, except per share
amounts)
|
|
Brinker believes
excluding special items from its financial results provides
investors with a clearer perspective of the Company's ongoing
operating performance and a more relevant comparison to prior
period results.
|
|
|
|
Fourth
Quarter
|
|
Fiscal
Year
|
|
Q4 22
|
|
EPS
Q4 22
|
|
Q4 21
|
|
EPS
Q4 21
|
|
FY 22
|
|
EPS
FY 22
|
|
FY 21
|
|
EPS
FY 21
|
Net income -
GAAP
|
$ 40.2
|
|
$ 0.90
|
|
$ 75.0
|
|
$ 1.58
|
|
$
117.6
|
|
$ 2.58
|
|
$
131.6
|
|
$ 2.83
|
Special items - Other
(gains) and
charges(1)
|
14.2
|
|
0.32
|
|
5.5
|
|
0.12
|
|
31.2
|
|
0.68
|
|
19.0
|
|
0.41
|
Special items -
Depreciation
|
0.1
|
|
0.00
|
|
0.2
|
|
0.00
|
|
0.5
|
|
0.01
|
|
0.6
|
|
0.01
|
Special items -
Interest
|
—
|
|
—
|
|
—
|
|
—
|
|
0.7
|
|
0.02
|
|
—
|
|
—
|
Income tax effect
related to
special items(2)
|
(3.5)
|
|
(0.07)
|
|
(1.4)
|
|
(0.03)
|
|
(8.0)
|
|
(0.18)
|
|
(4.9)
|
|
(0.11)
|
Special items, net of
taxes
|
10.8
|
|
0.25
|
|
4.3
|
|
0.09
|
|
24.4
|
|
0.53
|
|
14.7
|
|
0.31
|
Adjustment for special
tax items
|
0.2
|
|
0.00
|
|
0.7
|
|
0.01
|
|
(1.0)
|
|
(0.02)
|
|
(0.9)
|
|
(0.02)
|
Net income, excluding
special items -
Non-GAAP
|
$ 51.2
|
|
$ 1.15
|
|
$ 80.0
|
|
$ 1.68
|
|
$
141.0
|
|
$ 3.09
|
|
$
145.4
|
|
$ 3.12
|
Reconciliation of
Restaurant Operating Margin (in millions, except
percentages)
|
|
Q4
22
|
|
|
Chili's
|
|
Maggiano's
|
|
Brinker
|
|
Q4 22
|
|
Q4 21
|
|
Q4 22
|
|
Q4 21
|
|
Q4 22
|
|
Q4 21
|
Operating income -
GAAP
|
$
59.5
|
|
$ 125.7
|
|
$
14.1
|
|
$
10.7
|
|
$
44.7
|
|
$ 100.6
|
Operating income as a
percentage of Total revenues
|
6.6 %
|
|
13.8 %
|
|
12.0 %
|
|
11.3 %
|
|
4.4 %
|
|
10.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income -
GAAP
|
$
59.5
|
|
$ 125.7
|
|
$
14.1
|
|
$
10.7
|
|
$
44.7
|
|
$ 100.6
|
Less: Franchise
and other revenues
|
(27.3)
|
|
(15.3)
|
|
(6.8)
|
|
(2.4)
|
|
(34.1)
|
|
(17.7)
|
Plus:
Depreciation and amortization
|
35.5
|
|
31.9
|
|
3.2
|
|
3.4
|
|
41.3
|
|
38.2
|
General and
administrative
|
8.6
|
|
9.6
|
|
1.8
|
|
1.9
|
|
35.3
|
|
40.6
|
Other (gains) and
charges
|
13.1
|
|
1.6
|
|
(0.2)
|
|
0.2
|
|
14.2
|
|
5.5
|
Restaurant operating
margin - non-GAAP
|
$
89.4
|
|
$ 153.5
|
|
$
12.1
|
|
$
13.8
|
|
$ 101.4
|
|
$ 167.2
|
Restaurant operating
margin as a percentage of Company sales
|
10.2 %
|
|
17.1 %
|
|
11.0 %
|
|
15.0 %
|
|
10.3 %
|
|
16.9 %
|
|
Fiscal
2022
|
|
|
Chili's
|
|
Maggiano's
|
|
Brinker
|
|
FY 22
|
|
FY 21
|
|
FY 22
|
|
FY 21
|
|
FY 22
|
|
FY 21
|
Operating income -
GAAP
|
$ 241.0
|
|
$ 312.2
|
|
$
41.0
|
|
$ 6.5
|
|
$ 159.5
|
|
$ 199.3
|
Operating income as a
percentage of Total revenues
|
7.1 %
|
|
10.2 %
|
|
9.7 %
|
|
2.3 %
|
|
4.2 %
|
|
6.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income -
GAAP
|
$ 241.0
|
|
$ 312.2
|
|
$
41.0
|
|
$ 6.5
|
|
$ 159.5
|
|
$ 199.3
|
Less: Franchise
and other revenues
|
(74.2)
|
|
(54.2)
|
|
(17.8)
|
|
(4.6)
|
|
(92.0)
|
|
(58.8)
|
Plus:
Depreciation and amortization
|
139.8
|
|
124.3
|
|
13.4
|
|
13.8
|
|
164.4
|
|
150.2
|
General and
administrative
|
33.3
|
|
27.4
|
|
8.0
|
|
5.8
|
|
144.1
|
|
134.8
|
Other (gains) and
charges
|
23.3
|
|
12.7
|
|
0.0
|
|
1.4
|
|
31.2
|
|
19.0
|
Restaurant operating
margin - non-GAAP
|
$ 363.2
|
|
$ 422.4
|
|
$
44.6
|
|
$
22.9
|
|
$ 407.2
|
|
$ 444.5
|
Restaurant operating
margin as a percentage of Company sales
|
11.0 %
|
|
14.1 %
|
|
11.0 %
|
|
8.4 %
|
|
11.0 %
|
|
13.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Restaurant operating margin is not a measurement determined in
accordance with GAAP and should not be considered in isolation, or
as an alternative to operating income as an indicator of financial
performance. Restaurant operating margin is widely regarded in the
restaurant industry as a useful metric by which to evaluate
restaurant-level operating efficiency and performance of ongoing
restaurant-level operations. This non-GAAP measure is not
indicative of overall Company performance and profitability because
this measure does not directly accrue benefit to the shareholders
due to the nature of costs excluded.
We define Restaurant operating margin as Company sales less Food
and beverage costs, Restaurant labor and Restaurant expenses. We
believe this metric provides a more useful comparison between
periods and enables investors to focus on the performance of
restaurant-level operations by excluding revenues not related to
food and beverage sales at Company-owned restaurants, corporate
General and administrative expenses, Depreciation and amortization,
and Other (gains) and charges. Restaurant operating margin as
presented may not be comparable to other similarly titled measures
of other companies in our industry.
Reconciliation of Adjusted EBITDA
(in millions)
Brinker believes presenting Adjusted EBITDA provides a useful
measure of our operating performance, excluding the impacts of
financing costs, capital expenditures and special items. Adjusted
EBITDA is not a measurement determined in accordance with GAAP and
should not be considered in isolation. We define Adjusted EBITDA as
Operating income before Depreciation and amortization and Other
(gains) and charges.
|
Fourth
Quarter
|
|
Fiscal
Year
|
|
Q4 22
|
|
Q4 21
|
|
Q4 22
|
|
Q4 21
|
Operating income -
GAAP
|
$
44.7
|
|
$
100.6
|
|
$
159.5
|
|
$
199.3
|
Depreciation and
amortization
|
41.3
|
|
38.2
|
|
164.4
|
|
150.2
|
Other (gains) and
charges
|
14.2
|
|
5.5
|
|
31.2
|
|
19.0
|
Adjusted EBITDA,
non-GAAP
|
$
100.2
|
|
$
144.3
|
|
$
355.1
|
|
$
368.5
|
|
Reconciliation of Free Cash Flow
(in millions)
Brinker believes presenting free cash flow provides a useful
measure to evaluate the cash flow available for reinvestment after
considering the capital requirements and expenditures of our
business operations.
|
Fifty-Two Week
Period Ended
June 29, 2022
|
Cash flows provided by
operating activities - GAAP
|
$
252.2
|
Capital
expenditures
|
(150.3)
|
Free cash flow -
non-GAAP
|
$
101.9
|
|
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SOURCE Brinker International Payroll Company, L.P.