DALLAS, Nov. 2, 2022
/PRNewswire/ -- Brinker International, Inc. (NYSE: EAT) today
announced results for the first quarter of fiscal 2023 ended
September 28, 2022.
"I'm encouraged by our quick progress to grow topline sales and
simplify operations," said Kevin
Hochman, Chief Executive Officer and President of Brinker
International. "And now that we've defined our key areas of focus,
we are moving quickly to execute strategies designed to strengthen
our position in casual dining and grow our core business over
time."
Fiscal 2023 Highlights - First Quarter
- Brinker International reported Company sales(1) of
$946.1 million in the first quarter
of fiscal 2023 as compared to $865.6
million in the first quarter of fiscal 2022.
- Operating loss in the first quarter of fiscal 2023 was
$19.8 million as compared to
Operating income of $25.6 million in
the first quarter of fiscal 2022. Operating loss, as a percentage
of Total revenues, in the first quarter of fiscal 2023 was 2.1% as
compared to Operating income, as a percentage of Total revenues, of
2.9% in the first quarter of fiscal 2022. The primary driver of the
operating loss in the first quarter was the significant increase in
Food and beverage costs due mainly to chicken and beef
pricing.
- Restaurant operating margin(1), as a percentage of
Company sales, in the first quarter of fiscal 2023 was 6.0% as
compared to 11.0% in the first quarter of fiscal 2022. The decline
in restaurant operating margin was primarily driven by commodity
price inflation of approximately 24% as compared to the first
quarter of fiscal 2022.
- Net loss per diluted share, on a GAAP basis, in the first
quarter of fiscal 2023 was $0.69 as
compared to Net income per diluted share of $0.28 in the first quarter of fiscal 2022.
- Net loss per diluted share, excluding special items, in the
first quarter of fiscal 2023 was $0.57 as compared to Net income per diluted share
of $0.34 in the first quarter of
fiscal 2022.
- Adjusted EBITDA in the first quarter of fiscal 2023 was
$27.1 million as compared to
$69.4 million in the first quarter of
fiscal 2022.
For comparable restaurant sales details and non-GAAP
reconciliations, please refer to the Non-GAAP Information and
Reconciliations section of this release.
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section below for more details.
|
Comparable Restaurant Sales(1)
|
Q1:23 vs
22
|
Brinker
|
5.3 %
|
Chili's
|
3.8 %
|
Maggiano's
|
18.2 %
|
(1)
|
Comparable Restaurant
Sales include restaurants that have been in operation for more than
18 months. Restaurants temporarily closed for 14 days or more are
excluded from comparable restaurant sales. Percentage amounts are
calculated based on the comparable periods
year-over-year.
|
Financial Metrics
|
First
Quarter
|
|
2023
|
|
2022
|
|
Variance
|
Company
sales(1)
|
$
946.1
|
|
$
865.6
|
|
$ 80.5
|
Total
revenues
|
$
955.5
|
|
$
876.4
|
|
$ 79.1
|
|
|
|
|
|
|
Operating (loss)
income
|
$
(19.8)
|
|
$ 25.6
|
|
$
(45.4)
|
Operating (loss) income
as a percentage of Total revenues
|
(2.1) %
|
|
2.9 %
|
|
(5.0) %
|
Restaurant operating
margin, non-GAAP(1)(2)
|
$ 57.2
|
|
$ 95.1
|
|
$
(37.9)
|
Restaurant operating
margin as a percentage of Company sales,
non-GAAP(1)(2)
|
6.0 %
|
|
11.0 %
|
|
(5.0) %
|
Adjusted EBITDA,
non-GAAP(2)
|
$ 27.1
|
|
$ 69.4
|
|
$
(42.3)
|
|
|
|
|
|
|
Net (loss) income per
diluted share
|
$
(0.69)
|
|
$ 0.28
|
|
$
(0.97)
|
Net (loss) income per
diluted share, excluding special items,
non-GAAP(2)
|
$
(0.57)
|
|
$ 0.34
|
|
$
(0.91)
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section below for more details.
|
(2)
|
See Non-GAAP
Information and Reconciliations section below for more
details.
|
Basis of Presentation
Effective for the first quarter of fiscal 2023, we are
presenting certain revenue streams within Company sales to better
align with the presentation used within the casual dining industry.
Our presentation of Franchise revenues will now include only
revenues related to the franchise-operated restaurants. Comparative
figures in prior years have been adjusted to conform to the current
year's presentation. These reclassifications have no effect on
Total revenues or Net income previously reported.
Company sales include revenues generated by the operation
of Company-owned restaurants including food and beverage sales, net
of discounts, Maggiano's banquet service charge income, gift card
breakage, delivery income, digital entertainment revenues,
merchandise income and gift card discount costs from third-party
gift card sales.
Franchise revenues include franchise royalties, franchise
advertising fees, franchise and development fees and gift card
equalization.
First Quarter of Fiscal 2023 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 periods ended September 28, 2022 and September 29, 2021:
|
Chili's
|
|
Maggiano's
|
|
First
Quarter
|
|
Variance
|
|
First
Quarter
|
|
Variance
|
|
2023
|
|
2022
|
|
|
2023
|
|
2022
|
|
Company
sales(1)
|
$ 840.6
|
|
$ 776.9
|
|
$ 63.7
|
|
$ 105.5
|
|
$ 88.7
|
|
$ 16.8
|
Franchise
revenues(1)
|
9.3
|
|
10.7
|
|
(1.4)
|
|
0.1
|
|
0.1
|
|
—
|
Total
revenues
|
$ 849.9
|
|
$ 787.6
|
|
$ 62.3
|
|
$ 105.6
|
|
$ 88.8
|
|
$ 16.8
|
|
|
|
|
|
|
|
|
|
|
|
|
Company restaurant
expenses(2)
|
$ 792.2
|
|
$ 691.5
|
|
$ 100.7
|
|
$ 96.5
|
|
$ 78.9
|
|
$ 17.6
|
Company restaurant
expenses as a % of Company sales(1)
|
94.2 %
|
|
89.0 %
|
|
5.2 %
|
|
91.5 %
|
|
89.0 %
|
|
2.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
$
9.2
|
|
$ 52.3
|
|
$ (43.1)
|
|
$
2.9
|
|
$
4.3
|
|
$
(1.4)
|
Operating income (loss)
as a % of Total revenues
|
1.1 %
|
|
6.6 %
|
|
(5.5) %
|
|
2.7 %
|
|
4.8 %
|
|
(2.1) %
|
|
|
|
|
|
|
|
|
|
|
|
|
Restaurant operating
margin - non-GAAP(1)(3)
|
$ 48.4
|
|
$ 85.4
|
|
$ (37.0)
|
|
$
9.0
|
|
$
9.8
|
|
$
(0.8)
|
Restaurant operating
margin as a % of Company sales -
non-GAAP(1)(3)
|
5.8 %
|
|
11.0 %
|
|
(5.2) %
|
|
8.5 %
|
|
11.0 %
|
|
(2.5) %
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section above for more details.
|
(2)
|
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.
|
(3)
|
See Non-GAAP
Information and Reconciliations section below for more
details.
|
Chili's
- Chili's Company sales increased primarily due to increased menu
pricing, favorable menu item mix and the acquisition of 68
restaurants in fiscal 2022, partially offset by lower traffic.
- Chili's Company restaurant expenses, as a percentage of Company
sales, increased primarily due to higher commodity costs, delivery
fees, manager salary expenses, hourly wage rates, utilities
expenses and rent expenses. These increases were partially offset
by sales leverage and lower advertising.
Maggiano's
- Maggiano's Company sales increased primarily due to higher
dining room and banquet traffic and increased menu
pricing.
- Maggiano's Company restaurant expenses, as a percentage of
Company sales, increased primarily due to higher commodity costs,
delivery fees, utilities expenses, maintenance costs, rent expenses
and increased restaurant labor costs. These increases were
partially offset by sales leverage.
Income Taxes
- On a GAAP basis, the effective income tax rate was a benefit of
4.7% in the first quarter of fiscal 2023 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 5.0% in the first quarter of fiscal
2023.
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, November 2, 2022 at
9 a.m. CDT:
http://investors.brinker.com/events/event-details/q1-2023-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
November 16, 2022.
Additional financial information, including statements of income
which detail operations excluding special items, franchise
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-Q for the first quarter of fiscal 2023 filing on or
before November 7, 2022
- Earnings release call for the second quarter of fiscal 2023 on
February 1, 2023
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
in 1975 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; failure to comply with new environmental,
social and governance (ESG) requirements; failure to achieve any
goals, targets or objectives with respect to ESG matters; adverse
weather conditions; terrorist acts; health epidemics or pandemics
(such as COVID-19); tax reform; inadequate insurance coverage and
limitations imposed by our credit agreements 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 (Loss) Income
(Unaudited)
|
(In millions, except
per share amounts)
|
|
|
Thirteen Week
Periods Ended
|
|
September 28,
2022
|
|
September 29,
2021
|
Revenues
|
|
|
|
Company
sales(1)
|
$
946.1
|
|
$
865.6
|
Franchise
revenues(1)
|
9.4
|
|
10.8
|
Total
revenues
|
955.5
|
|
876.4
|
Operating costs and
expenses
|
|
|
|
Food and beverage
costs
|
289.5
|
|
234.3
|
Restaurant
labor
|
330.6
|
|
304.9
|
Restaurant
expenses
|
268.8
|
|
231.3
|
Depreciation and
amortization
|
41.9
|
|
39.3
|
General and
administrative
|
39.5
|
|
36.5
|
Other (gains) and
charges(2)
|
5.0
|
|
4.5
|
Total operating costs
and expenses
|
975.3
|
|
850.8
|
Operating (loss)
income
|
(19.8)
|
|
25.6
|
Interest
expenses
|
12.3
|
|
12.5
|
Other income,
net
|
(0.4)
|
|
(0.3)
|
(Loss) Income before
income taxes
|
(31.7)
|
|
13.4
|
(Benefit) Provision for
income taxes
|
(1.5)
|
|
0.2
|
Net (loss)
income
|
$
(30.2)
|
|
$
13.2
|
|
|
|
|
Basic net (loss) income
per share
|
$
(0.69)
|
|
$
0.29
|
|
|
|
|
Diluted net (loss)
income per share
|
$
(0.69)
|
|
$
0.28
|
|
|
|
|
Basic weighted average
shares outstanding
|
43.9
|
|
45.9
|
|
|
|
|
Diluted weighted
average shares outstanding
|
43.9
|
|
47.0
|
|
|
|
|
Other comprehensive
loss
|
|
|
|
Foreign currency
translation adjustments(3)
|
$
(1.0)
|
|
$
(0.4)
|
Other comprehensive
loss
|
(1.0)
|
|
(0.4)
|
Comprehensive (loss)
income
|
$
(31.2)
|
|
$
12.8
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section above for more details.
|
(2)
|
Other (gains) and
charges included in the Consolidated Statements of Comprehensive
Income (Unaudited) included (in millions):
|
|
Thirteen Week
Periods Ended
|
|
September 28,
2022
|
|
September 29,
2021
|
Restaurant closure
charges
|
$
1.5
|
|
$
0.2
|
Enterprise system
implementation costs
|
1.0
|
|
0.6
|
Remodel-related
costs
|
0.8
|
|
1.5
|
Lease modification
gain, net
|
(0.7)
|
|
—
|
Other
|
2.4
|
|
2.2
|
|
$
5.0
|
|
$
4.5
|
(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 (loss) income and would only be
realized upon disposition of these restaurants.
|
BRINKER INTERNATIONAL, INC.
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
(In
millions)
|
|
|
September
28,
2022
|
|
June 29,
2022
|
ASSETS
|
|
|
|
Total current
assets
|
$
209.8
|
|
$
201.2
|
Net property and
equipment
|
823.1
|
|
816.7
|
Operating lease
assets
|
1,152.1
|
|
1,160.5
|
Deferred income taxes,
net
|
66.5
|
|
62.5
|
Other
assets
|
242.3
|
|
243.5
|
Total
assets
|
$
2,493.8
|
|
$
2,484.4
|
LIABILITIES AND
SHAREHOLDERS' DEFICIT
|
|
|
|
Total current
liabilities
|
$
573.6
|
|
$
558.0
|
Long-term debt and
finance leases, less current installments
|
1,020.8
|
|
989.1
|
Long-term operating
lease liabilities, less current portion
|
1,141.1
|
|
1,151.1
|
Other
liabilities
|
54.9
|
|
54.3
|
Total shareholders'
deficit
|
(296.6)
|
|
(268.1)
|
Total liabilities and
shareholders' deficit
|
$
2,493.8
|
|
$
2,484.4
|
BRINKER INTERNATIONAL, INC.
|
Condensed
Consolidated Statements of Cash Flows (Unaudited)
|
(In
millions)
|
|
|
Thirteen Week
Periods Ended
|
|
September 28,
2022
|
|
September 29,
2021
|
Cash flows from
operating activities
|
|
|
|
Net (loss)
income
|
$
(30.2)
|
|
$
13.2
|
Adjustments to
reconcile Net (loss) income to Net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
41.9
|
|
39.3
|
Stock-based
compensation
|
4.7
|
|
4.3
|
Restructure and
impairment charges
|
2.4
|
|
1.9
|
Net loss on disposal
of assets
|
1.5
|
|
0.7
|
Other
|
0.4
|
|
1.5
|
Changes in assets and
liabilities
|
3.9
|
|
(20.7)
|
Net cash provided by
operating activities
|
24.6
|
|
40.2
|
Cash flows from
investing activities
|
|
|
|
Payments for property
and equipment
|
(46.7)
|
|
(37.3)
|
Proceeds from note
receivable
|
1.1
|
|
—
|
Payments for franchise
restaurant acquisitions
|
—
|
|
(47.5)
|
Proceeds from sale
leaseback transactions, net of related expenses
|
—
|
|
20.5
|
Net cash used in
investing activities
|
(45.6)
|
|
(64.3)
|
Cash flows from
financing activities
|
|
|
|
Borrowings on
revolving credit facility
|
135.0
|
|
285.0
|
Payments on revolving
credit facility
|
(100.0)
|
|
(205.0)
|
Payments on long-term
debt
|
(5.8)
|
|
(5.5)
|
Purchases of treasury
stock
|
(2.0)
|
|
(39.6)
|
Payments of
dividends
|
(0.2)
|
|
(0.8)
|
Proceeds from issuance
of treasury stock
|
0.0
|
|
0.3
|
Payments for debt
issuance costs
|
—
|
|
(3.0)
|
Net cash provided by
financing activities
|
27.0
|
|
31.4
|
Net change in cash and
cash equivalents
|
6.0
|
|
7.3
|
Cash and cash
equivalents at beginning of period
|
13.5
|
|
23.9
|
Cash and cash
equivalents at end of period
|
$
19.5
|
|
$
31.2
|
BRINKER INTERNATIONAL, INC.
|
Restaurant
Summary
|
|
|
|
|
|
|
Fiscal 2023 New
Openings
|
|
Total
Restaurants
Open at
September 28, 2022
|
|
Total
Restaurants
Open at
September 29, 2021
|
|
First Quarter
Openings
|
|
Full Year
Projected
Openings
|
Company-owned
restaurants
|
|
|
|
|
|
|
|
Chili's
domestic
|
1,126
|
|
1,088
|
|
—
|
|
17
|
Chili's
international
|
5
|
|
5
|
|
—
|
|
—
|
Maggiano's
domestic
|
51
|
|
52
|
|
—
|
|
—
|
Total
Company-owned
|
1,182
|
|
1,145
|
|
—
|
|
17
|
Franchise
restaurants
|
|
|
|
|
|
|
|
Chili's
domestic
|
102
|
|
146
|
|
1
|
|
1-2
|
Chili's
international
|
359
|
|
357
|
|
2
|
|
16-20
|
Maggiano's
domestic
|
2
|
|
2
|
|
—
|
|
—
|
Total
franchise
|
463
|
|
505
|
|
3
|
|
17-22
|
Total Company-owned and
franchise
|
|
|
|
|
|
|
|
Chili's
domestic
|
1,228
|
|
1,234
|
|
1
|
|
18-19
|
Chili's
international
|
364
|
|
362
|
|
2
|
|
16-20
|
Maggiano's
domestic
|
53
|
|
54
|
|
—
|
|
—
|
Total
|
1,645
|
|
1,650
|
|
3
|
|
34-39
|
NON-GAAP INFORMATION AND RECONCILIATIONS
Comparable Restaurant Sales
|
|
Comparable
Restaurant
Sales(1)
|
|
Price
Impact
|
|
Mix-Shift(2)
|
|
Traffic
|
|
Q1:23 vs
22
|
|
Q1:22 vs
21
|
|
Q1:23 vs
22
|
|
Q1:22 vs
21
|
|
Q1:23 vs
22
|
|
Q1:22 vs
21
|
|
Q1:23 vs
22
|
|
Q1:22 vs
21
|
Company-owned
|
5.3 %
|
|
17.0 %
|
|
7.2 %
|
|
0.6 %
|
|
3.0 %
|
|
5.6 %
|
|
(4.9) %
|
|
10.8 %
|
Chili's
|
3.8 %
|
|
13.4 %
|
|
7.4 %
|
|
0.6 %
|
|
3.0 %
|
|
3.4 %
|
|
(6.6) %
|
|
9.4 %
|
Maggiano's
|
18.2 %
|
|
62.6 %
|
|
5.8 %
|
|
0.2 %
|
|
3.1 %
|
|
23.3 %
|
|
9.3 %
|
|
39.1 %
|
Franchise(3)
|
6.6 %
|
|
23.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
|
0.6 %
|
|
17.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
10.4 %
|
|
32.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Chili's
domestic(4)
|
3.4 %
|
|
13.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
System-wide(5)
|
5.5 %
|
|
17.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
(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.
|
First
Quarter
|
|
Q1 23
|
|
EPS Q1
23
|
|
Q1 22
|
|
EPS Q1
22
|
Net (loss) income -
GAAP
|
$
(30.2)
|
|
$
(0.69)
|
|
$
13.2
|
|
$
0.28
|
Special items - Other
(gains) and charges(1)
|
5.0
|
|
0.11
|
|
4.5
|
|
0.10
|
Special items -
Depreciation
|
0.1
|
|
0.00
|
|
0.1
|
|
0.00
|
Special items -
Interest
|
—
|
|
—
|
|
0.7
|
|
0.01
|
Income tax effect
related to special items(2)
|
(1.3)
|
|
(0.02)
|
|
(1.3)
|
|
(0.03)
|
Special items, net of
taxes
|
3.8
|
|
0.09
|
|
4.0
|
|
0.08
|
Adjustment for special
tax items
|
1.1
|
|
0.03
|
|
(1.1)
|
|
(0.02)
|
Net (loss) income,
excluding special items - Non-GAAP
|
$
(25.3)
|
|
$
(0.57)
|
|
$
16.1
|
|
$
0.34
|
(1)
|
See Footnote "(2)" to
the Consolidated Statements of Comprehensive (Loss) Income
(Unaudited) for additional details on the composition of Other
(gains) and charges.
|
(2)
|
Income tax effect
related to special items is based on the statutory tax rate in
effect at the end of each period presented.
|
Reconciliation of Restaurant Operating Margin (in millions,
except percentages)
|
Chili's
|
|
Maggiano's
|
|
Brinker
|
|
Q1 23
|
|
Q1 22
|
|
Q1 23
|
|
Q1 22
|
|
Q1 23
|
|
Q1 22
|
Operating (loss) income
- GAAP
|
$ 9.2
|
|
$
52.3
|
|
$ 2.9
|
|
$ 4.3
|
|
$ (19.8)
|
|
$
25.6
|
Operating (loss) income
as a percentage of Total revenues
|
1.1 %
|
|
6.6 %
|
|
2.7 %
|
|
4.8 %
|
|
(2.1) %
|
|
2.9 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss) income
- GAAP
|
$ 9.2
|
|
$
52.3
|
|
$ 2.9
|
|
$ 4.3
|
|
$ (19.8)
|
|
$
25.6
|
Less: Franchise
revenues(1)
|
(9.3)
|
|
(10.7)
|
|
(0.1)
|
|
(0.1)
|
|
(9.4)
|
|
(10.8)
|
Plus:
Depreciation and amortization
|
36.0
|
|
33.0
|
|
3.2
|
|
3.4
|
|
41.9
|
|
39.3
|
General and
administrative
|
9.5
|
|
8.0
|
|
2.5
|
|
2.0
|
|
39.5
|
|
36.5
|
Other (gains) and
charges
|
3.0
|
|
2.8
|
|
0.5
|
|
0.2
|
|
5.0
|
|
4.5
|
Restaurant operating
margin - non-GAAP(1)
|
$
48.4
|
|
$
85.4
|
|
$ 9.0
|
|
$ 9.8
|
|
$
57.2
|
|
$
95.1
|
Restaurant operating
margin as a percentage of Company sales(1)
|
5.8 %
|
|
11.0 %
|
|
8.5 %
|
|
11.0 %
|
|
6.0 %
|
|
11.0 %
|
(1)
|
Certain
reclassifications have been made to prior year revenue amounts to
enhance comparability to the fiscal 2023 presentation. See Basis of
Presentation section above for more details.
|
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 (loss) income before Depreciation and amortization and
Other (gains) and charges.
|
First
Quarter
|
|
Q1 23
|
|
Q1 22
|
Operating (loss) income
- GAAP
|
$
(19.8)
|
|
$
25.6
|
Depreciation and
amortization
|
41.9
|
|
39.3
|
Other (gains) and
charges
|
5.0
|
|
4.5
|
Adjusted EBITDA,
non-GAAP
|
$
27.1
|
|
$
69.4
|
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SOURCE Brinker International Payroll Company, L.P.