SAN DIEGO--(BUSINESS WIRE)--Nov. 21, 2016--
Jack in the Box Inc. (NASDAQ: JACK) today reported earnings from
continuing operations of $32.6 million, or $0.98 per diluted share, for
the fourth quarter ended October 2, 2016, compared with $23.8 million,
or $0.65 per diluted share, for the fourth quarter of fiscal 2015.
Fiscal 2016 earnings from continuing operations totaled $126.3 million,
or $3.70 per diluted share, compared with $112.6 million, or $2.95 per
diluted share in fiscal 2015.
Operating earnings per share, a non-GAAP measure which the company
defines as diluted earnings per share from continuing operations on a
GAAP basis excluding restructuring charges and gains or losses from
refranchising, were $1.03 in the fourth quarter of fiscal 2016 compared
with $0.62 in the prior year quarter. For fiscal year 2016, operating
earnings per share were $3.86 compared with $3.00 last year.
The fourth quarter and fiscal year ended October 2, 2016, included 13
weeks and 53 weeks, respectively, as compared to 12 weeks and 52 weeks
in the fourth quarter and fiscal year ended September 27, 2015,
respectively. The company estimates that the extra week benefited
diluted earnings per share by approximately 9 cents in both the fourth
quarter and fiscal 2016.
A reconciliation of non-GAAP measurements to GAAP results is provided
below, with additional information included in the attachment to this
release. Figures may not add due to rounding.
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Oct. 2, 2016
|
|
Sept. 27, 2015
|
|
Oct. 2, 2016
|
|
Sept. 27, 2015
|
Diluted earnings per share from continuing operations – GAAP
|
|
$
|
0.98
|
|
|
$
|
0.65
|
|
|
$
|
3.70
|
|
|
$
|
2.95
|
Restructuring charges
|
|
0.05
|
|
|
0.00
|
|
|
0.19
|
|
|
0.00
|
(Gains) losses from refranchising
|
|
0.00
|
|
|
(0.02
|
)
|
|
(0.02
|
)
|
|
0.05
|
Operating earnings per share – Non-GAAP
|
|
$
|
1.03
|
|
|
$
|
0.62
|
|
|
$
|
3.86
|
|
|
$
|
3.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During fiscal 2016, the company announced plans to reduce general and
administrative costs. A comprehensive review of its organizational
structure identified cost savings from workforce reductions, relocation
and consolidation of the Qdoba® corporate support center,
refranchising initiatives, and information technology synergies across
both brands. As a result, restructuring charges of $2.3 million, or
approximately $0.05 per diluted share, were recorded during the fourth
quarter. Restructuring charges for fiscal year 2016 totaled $10.1
million, or approximately $0.19 per diluted share. Charges consist
primarily of employee severance pay and facility closing costs. These
charges are included in “impairment and other charges, net” in the
accompanying consolidated statements of earnings.
Lenny Comma, chairman and chief executive officer, said, “Operating
earnings per share for the fourth quarter exceeded our expectations, due
primarily to a reduction in G&A costs resulting from our restructuring
initiatives, as well as lower impairment charges and a lower tax rate.
We were pleased that Jack in the Box® system same-store sales
outperformed sluggish industry trends, and although sales and traffic
growth at Qdoba were solid, margins were hampered by the impact of new
restaurant openings.
“Operating earnings per share for the year (excluding the benefit of the
53rd week) grew more than 25 percent, the fifth consecutive year of
growth in excess of 20 percent.
“We are happy with the progress we made on our key strategic initiatives
during the year, as we made significant headway on reducing our G&A,
increased our borrowing capacity to support our capital structure goals,
and began implementing plans to increase the franchise mix at Jack in
the Box to over 90 percent of the system.”
Increase in same-store sales:
|
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
|
Oct. 2, 2016
|
|
Sept. 27, 2015
|
|
Oct. 2, 2016
|
|
Sept. 27, 2015
|
Jack in the Box:
|
|
|
|
|
|
|
|
|
|
Company
|
|
0.5%
|
|
4.1%
|
|
0.0%
|
|
5.1%
|
|
Franchise
|
|
2.4%
|
|
6.9%
|
|
1.6%
|
|
7.0%
|
|
System
|
|
2.0%
|
|
6.2%
|
|
1.2%
|
|
6.5%
|
Qdoba:
|
|
|
|
|
|
|
|
|
|
Company
|
|
1.2%
|
|
6.1%
|
|
1.7%
|
|
8.3%
|
|
Franchise
|
|
0.4%
|
|
7.2%
|
|
1.1%
|
|
10.4%
|
|
System
|
|
0.8%
|
|
6.6%
|
|
1.4%
|
|
9.3%
|
|
|
|
|
|
|
|
|
|
|
Jack in the Box system same-store sales increased 2.0 percent for the
quarter and exceeded the QSR sandwich segment by 1.3 percentage points
for the comparable period, according to The NPD Group’s SalesTrack®
Weekly for the 13-week time period ended October 2, 2016. Included in
this segment are 16 of the top QSR sandwich and burger chains in the
country. Company same-store sales increased 0.5 percent in the fourth
quarter, with average check up 3.5 percent.
Qdoba same-store sales increased 0.8 percent system-wide and 1.2 percent
for company restaurants in the fourth quarter. Company same-store sales
reflected a 0.7 percent increase in transactions as well as growth in
catering sales.
Consolidated restaurant operating margin decreased by 30 basis points to
19.7 percent of sales in the fourth quarter of 2016, compared with 20.0
percent of sales in the year-ago quarter. Restaurant operating margin
for Jack in the Box company restaurants increased 70 basis points to
21.0 percent of sales. The increase was due primarily to favorable food
and packaging costs, which were partially offset by higher costs related
to equipment upgrades, maintenance and repair expenses, and minimum wage
increases in California that went into effect in January 2016. The
decrease in food and packaging costs as a percentage of sales resulted
from the benefit of commodity deflation of approximately 4.0 percent in
the quarter, favorable product mix changes and menu price increases.
Restaurant operating margin for Qdoba company restaurants decreased 220
basis points to 17.3 percent of sales. The decrease was due primarily to
costs associated with a greater number of new restaurant openings,
increased promotional activity, and higher costs related to technology
upgrades which more than offset the sales growth and benefits from
commodity deflation of approximately 3.4 percent in the quarter.
Franchise margin as a percentage of total franchise revenues improved to
53.7 percent in the fourth quarter from 51.4 percent in the prior year
quarter. The improvement was due primarily to higher royalty revenue for
both brands and higher rental income from Jack in the Box franchised
restaurants resulting from increases in franchise average unit volumes.
SG&A expense for the fourth quarter decreased by $6.3 million and was
12.1 percent of revenues as compared to 15.4 percent in the prior year
quarter. Key items contributing to the decrease were lower advertising
costs at Qdoba due to the timing of promotional activities and a $1.2
million decrease in pension and postretirement benefits related to the
sunsetting of the company's qualified pension plan on December 31, 2015.
In addition, mark-to-market adjustments on investments supporting the
company’s non-qualified retirement plans positively impacted SG&A by
$0.2 million in the fourth quarter of 2016 as compared to a negative
impact of $1.1 million in the fourth quarter of 2015, resulting in a
year-over-year decrease in SG&A of $1.3 million. These decreases were
partially offset by the impact of the 53rd week.
Interest expense, net, increased by $3.5 million in the fourth quarter
due to increased leverage and a higher effective interest rate for 2016.
Capital Allocation
The company repurchased approximately 425,000 shares of its common stock
in the fourth quarter of 2016 at an average price of $98.42 per share
for an aggregate cost of $41.9 million. During fiscal year 2016, the
company repurchased approximately 3,876,000 shares at an average price
of $75.29 per share, for an aggregate cost of $291.9 million. As of the
end of fiscal year 2016, the company had $408.2 million remaining under
stock-buyback programs authorized by its Board of Directors, of which
$108.2 million expires in November 2017 and $300.0 million expires in
November 2018.
As previously disclosed, the company made an accelerated pension
contribution of $80 million during the fourth quarter of 2016. This
tax-deductible contribution will decrease the company's future G&A
costs, as well as reduce, if not fully eliminate, pension contributions
over the next several years.
In addition, the company acquired 14 franchised Qdoba restaurants in one
market during the fourth quarter of 2016 for approximately $20 million.
The company also announced today that on November 17, 2016, its Board of
Directors declared a quarterly cash dividend of $0.40 per share on the
company’s common stock, representing a 33 percent increase from the
previous quarterly dividend of $0.30 per share. The dividend is payable
on December 16, 2016, to shareholders of record at the close of business
on December 5, 2016.
Guidance
The following guidance and underlying assumptions reflect the company’s
current expectations for the first quarter and fiscal year ending
October 1, 2017. Fiscal 2017 is a 52-week year, with 16 weeks in the
first quarter, 12 weeks in each of the second, third and fourth
quarters. Fiscal 2016 was a 53-week year, with the additional week
occurring in the fourth quarter.
First quarter fiscal year 2017 guidance
-
Same-store sales increase of approximately 2.0 to 4.0 percent at Jack
in the Box system restaurants versus a 1.4 percent increase in the
year-ago quarter.
-
Same-store sales of approximately flat to up 1.0 percent at Qdoba
company restaurants versus a 1.5 percent increase in the year-ago
quarter.
Fiscal year 2017 guidance
-
Same-store sales increase of approximately 2.0 to 3.0 percent at Jack
in the Box system restaurants.
-
Same-store sales increase of approximately 2.0 to 3.0 percent at Qdoba
company restaurants.
-
Commodity deflation of approximately flat to down 1 percent for both
Jack in the Box and Qdoba.
-
Consolidated restaurant operating margin of approximately 20.0 to 21.0
percent.
-
SG&A as a percentage of revenues of approximately 11.0 to 11.5 percent
as compared to 12.7 percent in fiscal 2016.
-
Impairment and other charges as a percentage of revenues of
approximately 70 basis points, excluding restructuring charges.
-
Approximately 20 to 25 new Jack in the Box restaurants opening
system-wide, the majority of which will be franchise locations.
-
Approximately 60 to 70 new Qdoba restaurants, of which approximately
40 are expected to be company locations.
-
Capital expenditures of $105 to $115 million.
-
Tax rate of approximately 38 percent.
-
Operating earnings per share, which the company defines as diluted
earnings per share from continuing operations on a GAAP basis
excluding restructuring charges and gains or losses from
refranchising, ranging from $4.55 to $4.75. This guidance assumes
share repurchases of approximately $408 million during the year,
representing the amount remaining under current Board authorizations.
Conference call
The company will host a conference call for financial analysts and
investors on Tuesday, November 22, 2016, beginning at 8:30 a.m. PT
(11:30 a.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 11:30 a.m. PT on November 22.
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. Additionally, through a wholly owned
subsidiary, the company operates and franchises Qdoba Mexican Eats®,
a leader in fast-casual dining, with approximately 700 restaurants in 47
states, the District of Columbia and Canada. For more information on
Jack in the Box and Qdoba, including franchising opportunities, visit www.jackinthebox.com
or www.qdoba.com.
Safe harbor statement
This press release contains forward-looking statements within the
meaning of the federal securities laws. Such statements are subject to
substantial risks and uncertainties. A variety of factors could cause
the company’s actual results to differ materially from those expressed
in the forward-looking statements, including the following: the success
of new products and marketing initiatives; the impact of competition,
unemployment, trends in consumer spending patterns and commodity costs;
the company's ability to reduce G&A; the company's ability to execute
its refranchising strategy; 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, and risks relating to expansion into new markets;
litigation risks; food safety incidents or negative publicity impacting
the reputations of the company's brands; 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
RECONCILIATION OF
NON-GAAP MEASUREMENTS TO GAAP RESULTS
(Unaudited)
Operating earnings per share, a non-GAAP measure, is defined by the
company as diluted earnings per share from continuing operations on a
GAAP basis excluding restructuring charges and gains or losses from
refranchising. Management believes this non-GAAP financial measure
provides important supplemental information to assist investors in
analyzing the performance of the company’s core business. In addition,
the company uses operating earnings per share in establishing
performance goals for purposes of executive compensation. The company
encourages investors to rely upon its GAAP numbers but includes this
non-GAAP financial measure as a supplemental metric to assist investors.
This non-GAAP financial measure should not be considered as a substitute
for, or superior to, financial measures calculated in accordance with
GAAP. In addition, this non-GAAP financial measure used by the company
may be calculated differently from, and therefore may not be comparable
to, similarly titled measures used by other companies.
Below is a reconciliation of non-GAAP operating earnings per share to
the most directly comparable GAAP measure, diluted earnings per share
from continuing operations. Figures may not add due to rounding.
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Oct. 2, 2016
|
|
Sept. 27, 2015
|
|
Oct. 2, 2016
|
|
Sept. 27, 2015
|
Diluted earnings per share from continuing operations – GAAP
|
|
$
|
0.98
|
|
|
$
|
0.65
|
|
|
$
|
3.70
|
|
|
$
|
2.95
|
Restructuring charges
|
|
0.05
|
|
|
0.00
|
|
|
0.19
|
|
|
0.00
|
(Gains) losses from refranchising
|
|
0.00
|
|
|
(0.02
|
)
|
|
(0.02
|
)
|
|
0.05
|
Operating earnings per share – Non-GAAP
|
|
$
|
1.03
|
|
|
$
|
0.62
|
|
|
$
|
3.86
|
|
|
$
|
3.00
|
|
JACK IN THE BOX INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share data)
(Unaudited)
|
|
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
October 2, 2016
|
|
September 27, 2015
|
|
October 2, 2016
|
|
September 27, 2015
|
Revenues:
|
|
|
|
|
|
|
|
|
Company restaurant sales
|
|
$
|
300,693
|
|
|
$
|
265,408
|
|
|
$
|
1,204,535
|
|
|
$
|
1,156,863
|
|
Franchise rental revenues
|
|
57,689
|
|
|
52,666
|
|
|
232,907
|
|
|
226,702
|
|
Franchise royalties and other
|
|
40,037
|
|
|
35,994
|
|
|
161,889
|
|
|
156,752
|
|
|
|
398,419
|
|
|
354,068
|
|
|
1,599,331
|
|
|
1,540,317
|
|
Operating costs and expenses, net:
|
|
|
|
|
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
|
|
Food and packaging
|
|
90,200
|
|
|
82,198
|
|
|
363,002
|
|
|
361,988
|
|
Payroll and employee benefits
|
|
83,516
|
|
|
71,654
|
|
|
334,470
|
|
|
313,302
|
|
Occupancy and other
|
|
67,814
|
|
|
58,421
|
|
|
264,158
|
|
|
246,023
|
|
Total company restaurant costs
|
|
241,530
|
|
|
212,273
|
|
|
961,630
|
|
|
921,313
|
|
Franchise occupancy expenses
|
|
41,677
|
|
|
39,281
|
|
|
170,152
|
|
|
170,102
|
|
Franchise support and other costs
|
|
3,568
|
|
|
3,773
|
|
|
15,991
|
|
|
15,688
|
|
Selling, general and administrative expenses
|
|
48,281
|
|
|
54,592
|
|
|
203,816
|
|
|
221,145
|
|
Impairment and other charges, net
|
|
4,459
|
|
|
3,689
|
|
|
19,057
|
|
|
11,757
|
|
(Gains) losses on the sale of company-operated restaurants
|
|
(6
|
)
|
|
(1,214
|
)
|
|
(1,230
|
)
|
|
3,139
|
|
|
|
339,509
|
|
|
312,394
|
|
|
1,369,416
|
|
|
1,343,144
|
|
Earnings from operations
|
|
58,910
|
|
|
41,674
|
|
|
229,915
|
|
|
197,173
|
|
Interest expense, net
|
|
8,382
|
|
|
4,866
|
|
|
31,081
|
|
|
18,803
|
|
Earnings from continuing operations and before income taxes
|
|
50,528
|
|
|
36,808
|
|
|
198,834
|
|
|
178,370
|
|
Income taxes
|
|
17,967
|
|
|
13,030
|
|
|
72,564
|
|
|
65,769
|
|
Earnings from continuing operations
|
|
32,561
|
|
|
23,778
|
|
|
126,270
|
|
|
112,601
|
|
Losses from discontinued operations, net of income tax benefit
|
|
(580
|
)
|
|
(637
|
)
|
|
(2,197
|
)
|
|
(3,789
|
)
|
Net earnings
|
|
$
|
31,981
|
|
|
$
|
23,141
|
|
|
$
|
124,073
|
|
|
$
|
108,812
|
|
|
|
|
|
|
|
|
|
|
Net earnings per share - basic:
|
|
|
|
|
|
|
|
|
Earnings from continuing operations
|
|
$
|
1.00
|
|
|
$
|
0.66
|
|
|
$
|
3.74
|
|
|
$
|
3.00
|
|
Losses from discontinued operations
|
|
(0.02
|
)
|
|
(0.02
|
)
|
|
(0.07
|
)
|
|
(0.10
|
)
|
Net earnings per share (1)
|
|
$
|
0.98
|
|
|
$
|
0.64
|
|
|
$
|
3.68
|
|
|
$
|
2.89
|
|
Net earnings per share - diluted:
|
|
|
|
|
|
|
|
|
Earnings from continuing operations
|
|
$
|
0.98
|
|
|
$
|
0.65
|
|
|
$
|
3.70
|
|
|
$
|
2.95
|
|
Losses from discontinued operations
|
|
(0.02
|
)
|
|
(0.02
|
)
|
|
(0.06
|
)
|
|
(0.10
|
)
|
Net earnings per share (1)
|
|
$
|
0.97
|
|
|
$
|
0.63
|
|
|
$
|
3.63
|
|
|
$
|
2.85
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
32,694
|
|
|
36,276
|
|
|
33,735
|
|
|
37,587
|
|
Diluted
|
|
33,085
|
|
|
36,822
|
|
|
34,146
|
|
|
38,215
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share
|
|
$
|
0.30
|
|
|
$
|
0.30
|
|
|
$
|
1.20
|
|
|
$
|
1.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
____________________________
|
(1)
|
|
|
Earnings per share may not add due to rounding.
|
|
|
|
|
|
JACK IN THE BOX INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(Unaudited)
|
|
|
|
October 2, 2016
|
|
September 27, 2015
|
ASSETS
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash
|
|
$
|
17,030
|
|
|
$
|
17,743
|
|
Accounts and other receivables, net
|
|
73,360
|
|
|
47,975
|
|
Inventories
|
|
8,229
|
|
|
7,376
|
|
Prepaid expenses
|
|
40,398
|
|
|
16,240
|
|
Assets held for sale
|
|
14,259
|
|
|
15,516
|
|
Other current assets
|
|
2,129
|
|
|
3,106
|
|
Total current assets
|
|
155,405
|
|
|
107,956
|
|
Property and equipment, at cost:
|
|
|
|
|
Land
|
|
117,166
|
|
|
112,991
|
|
Buildings
|
|
1,116,244
|
|
|
1,091,237
|
|
Restaurant and other equipment
|
|
331,644
|
|
|
315,235
|
|
Construction in progress
|
|
40,522
|
|
|
43,914
|
|
|
|
1,605,576
|
|
|
1,563,377
|
|
Less accumulated depreciation and amortization
|
|
(886,526
|
)
|
|
(835,114
|
)
|
Property and equipment, net
|
|
719,050
|
|
|
728,263
|
|
Intangible assets, net
|
|
14,042
|
|
|
14,765
|
|
Goodwill
|
|
166,046
|
|
|
149,027
|
|
Other assets, net
|
|
294,248
|
|
|
303,968
|
|
|
|
$
|
1,348,791
|
|
|
$
|
1,303,979
|
|
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Current maturities of long-term debt
|
|
$
|
57,574
|
|
|
$
|
26,677
|
|
Accounts payable
|
|
40,736
|
|
|
32,137
|
|
Accrued liabilities
|
|
181,250
|
|
|
170,575
|
|
Total current liabilities
|
|
279,560
|
|
|
229,389
|
|
Long-term debt, net of current maturities
|
|
937,512
|
|
|
688,579
|
|
Other long-term liabilities
|
|
348,925
|
|
|
370,058
|
|
Stockholders’ (deficit) equity:
|
|
|
|
|
Preferred stock $0.01 par value, 15,000,000 shares authorized, none
issued
|
|
—
|
|
|
—
|
|
Common stock $0.01 par value, 175,000,000 shares authorized,
81,598,524 and 81,096,156 issued, respectively
|
|
816
|
|
|
811
|
|
Capital in excess of par value
|
|
432,564
|
|
|
402,986
|
|
Retained earnings
|
|
1,399,721
|
|
|
1,316,119
|
|
Accumulated other comprehensive loss
|
|
(187,021
|
)
|
|
(132,530
|
)
|
Treasury stock, at cost, 49,190,992 and 45,314,529 shares,
respectively
|
|
(1,863,286
|
)
|
|
(1,571,433
|
)
|
Total stockholders’ (deficit) equity
|
|
(217,206
|
)
|
|
15,953
|
|
|
|
$
|
1,348,791
|
|
|
$
|
1,303,979
|
|
|
|
|
|
|
|
|
|
|
|
JACK IN THE BOX INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
|
|
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
October 2, 2016
|
|
September 27, 2015
|
Cash flows from operating activities:
|
|
|
|
|
Net earnings
|
|
$
|
124,073
|
|
|
$
|
108,812
|
|
Adjustments to reconcile net earnings to net cash provided by
operating activities:
|
|
|
|
|
Depreciation and amortization
|
|
92,844
|
|
|
89,468
|
|
Deferred finance cost amortization
|
|
2,736
|
|
|
2,309
|
|
Excess tax benefits from share-based compensation arrangements
|
|
(7,461
|
)
|
|
(18,602
|
)
|
Deferred income taxes
|
|
34,973
|
|
|
(3,191
|
)
|
Share-based compensation expense
|
|
11,455
|
|
|
12,420
|
|
Pension and postretirement expense
|
|
13,484
|
|
|
18,749
|
|
Gains on cash surrender value of company-owned life insurance
|
|
(5,365
|
)
|
|
1,240
|
|
(Gains) losses on the sale of company-operated restaurants
|
|
(1,230
|
)
|
|
3,139
|
|
Losses on the disposition of property and equipment
|
|
2,654
|
|
|
1,847
|
|
Impairment charges and other
|
|
4,759
|
|
|
6,815
|
|
Changes in assets and liabilities:
|
|
|
|
|
Accounts and other receivables
|
|
(28,181
|
)
|
|
(82
|
)
|
Inventories
|
|
(713
|
)
|
|
105
|
|
Prepaid expenses and other current assets
|
|
(15,367
|
)
|
|
35,255
|
|
Accounts payable
|
|
2,225
|
|
|
2,281
|
|
Accrued liabilities
|
|
8,662
|
|
|
798
|
|
Pension and postretirement contributions
|
|
(101,052
|
)
|
|
(25,374
|
)
|
Other
|
|
(4,314
|
)
|
|
(9,114
|
)
|
Cash flows provided by operating activities
|
|
134,182
|
|
|
226,875
|
|
Cash flows from investing activities:
|
|
|
|
|
Purchases of property and equipment
|
|
(96,615
|
)
|
|
(86,226
|
)
|
Purchases of assets intended for sale and leaseback
|
|
(9,785
|
)
|
|
(10,396
|
)
|
Proceeds from the sale and leaseback of assets
|
|
17,123
|
|
|
—
|
|
Proceeds from the sale of company-operated restaurants
|
|
1,439
|
|
|
3,951
|
|
Collections on notes receivable
|
|
3,555
|
|
|
5,917
|
|
Acquisition of franchise-operated restaurants
|
|
(19,816
|
)
|
|
—
|
|
Other
|
|
(299
|
)
|
|
2,281
|
|
Cash flows used in investing activities
|
|
(104,398
|
)
|
|
(84,473
|
)
|
Cash flows from financing activities:
|
|
|
|
|
Borrowings on revolving credit facilities
|
|
705,000
|
|
|
857,000
|
|
Repayments of borrowings on revolving credit facilities
|
|
(817,578
|
)
|
|
(768,000
|
)
|
Proceeds from issuance of debt
|
|
417,578
|
|
|
300,000
|
|
Principal repayments on debt
|
|
(26,154
|
)
|
|
(198,397
|
)
|
Debt issuance costs
|
|
(2,385
|
)
|
|
(2,030
|
)
|
Dividends paid on common stock
|
|
(40,295
|
)
|
|
(37,390
|
)
|
Proceeds from issuance of common stock
|
|
10,564
|
|
|
15,170
|
|
Repurchases of common stock
|
|
(284,645
|
)
|
|
(320,163
|
)
|
Excess tax benefits from share-based compensation arrangements
|
|
7,461
|
|
|
18,602
|
|
Cash flows used in financing activities
|
|
(30,454
|
)
|
|
(135,208
|
)
|
Effect of exchange rate changes on cash
|
|
(43
|
)
|
|
(29
|
)
|
Net (decrease) increase in cash
|
|
(713
|
)
|
|
7,165
|
|
Cash at beginning of period
|
|
17,743
|
|
|
10,578
|
|
Cash at end of period
|
|
$
|
17,030
|
|
|
$
|
17,743
|
|
|
JACK IN THE BOX INC. AND SUBSIDIARIES
SUPPLEMENTAL
INFORMATION
The following table presents certain income and expense items included
in our consolidated statements of earnings as a percentage of total
revenues, unless otherwise indicated. Percentages may not add due to
rounding.
|
CONSOLIDATED STATEMENTS OF EARNINGS DATA
(Unaudited)
|
|
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
October 2, 2016
|
|
September 27, 2015
|
|
October 2, 2016
|
|
September 27, 2015
|
Revenues:
|
|
|
|
|
|
|
|
|
Company restaurant sales
|
|
75.5
|
%
|
|
75.0
|
%
|
|
75.3
|
%
|
|
75.1
|
%
|
Franchise rental revenues
|
|
14.5
|
%
|
|
14.9
|
%
|
|
14.6
|
%
|
|
14.7
|
%
|
Franchise royalties and other
|
|
10.0
|
%
|
|
10.2
|
%
|
|
10.1
|
%
|
|
10.2
|
%
|
Total revenues
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Operating costs and expenses, net:
|
|
|
|
|
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
|
|
Food and packaging (1)
|
|
30.0
|
%
|
|
31.0
|
%
|
|
30.1
|
%
|
|
31.3
|
%
|
Payroll and employee benefits (1)
|
|
27.8
|
%
|
|
27.0
|
%
|
|
27.8
|
%
|
|
27.1
|
%
|
Occupancy and other (1)
|
|
22.6
|
%
|
|
22.0
|
%
|
|
21.9
|
%
|
|
21.3
|
%
|
Total company restaurant costs (1)
|
|
80.3
|
%
|
|
80.0
|
%
|
|
79.8
|
%
|
|
79.6
|
%
|
Franchise occupancy expenses (2)
|
|
72.2
|
%
|
|
74.6
|
%
|
|
73.1
|
%
|
|
75.0
|
%
|
Franchise support and other costs (3)
|
|
8.9
|
%
|
|
10.5
|
%
|
|
9.9
|
%
|
|
10.0
|
%
|
Selling, general and administrative expenses
|
|
12.1
|
%
|
|
15.4
|
%
|
|
12.7
|
%
|
|
14.4
|
%
|
Impairment and other charges, net
|
|
1.1
|
%
|
|
1.0
|
%
|
|
1.2
|
%
|
|
0.8
|
%
|
(Gains) losses on the sale of company-operated restaurants
|
|
0.0
|
%
|
|
(0.3
|
)%
|
|
(0.1
|
)%
|
|
0.2
|
%
|
Earnings from operations
|
|
14.8
|
%
|
|
11.8
|
%
|
|
14.4
|
%
|
|
12.8
|
%
|
Income tax rate (4)
|
|
35.6
|
%
|
|
35.4
|
%
|
|
36.5
|
%
|
|
36.9
|
%
|
|
____________________________
|
(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 earnings from continuing operations and before
income taxes.
|
|
|
|
|
The following table presents Jack in the Box and Qdoba company
restaurant sales, costs and margin, and restaurant costs and margin as a
percentage of the related sales. Percentages may not add due to rounding.
|
SUPPLEMENTAL COMPANY RESTAURANT OPERATIONS DATA
(Dollars in thousands)
(Unaudited)
|
|
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
October 2, 2016
|
|
September 27, 2015
|
|
October 2, 2016
|
|
September 27, 2015
|
Jack in the Box:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company restaurant sales
|
|
$
|
193,639
|
|
|
|
|
$
|
176,739
|
|
|
|
|
$
|
789,040
|
|
|
|
|
$
|
782,525
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and packaging
|
|
56,396
|
|
|
29.1
|
%
|
|
55,025
|
|
|
31.1
|
%
|
|
235,538
|
|
|
29.9
|
%
|
|
247,931
|
|
|
31.7
|
%
|
Payroll and employee benefits
|
|
55,275
|
|
|
28.5
|
%
|
|
48,371
|
|
|
27.4
|
%
|
|
223,019
|
|
|
28.3
|
%
|
|
215,598
|
|
|
27.6
|
%
|
Occupancy and other
|
|
41,347
|
|
|
21.4
|
%
|
|
37,484
|
|
|
21.2
|
%
|
|
162,869
|
|
|
20.6
|
%
|
|
157,281
|
|
|
20.1
|
%
|
Total company restaurant costs
|
|
153,018
|
|
|
79.0
|
%
|
|
140,880
|
|
|
79.7
|
%
|
|
621,426
|
|
|
78.8
|
%
|
|
620,810
|
|
|
79.3
|
%
|
Restaurant margin
|
|
$
|
40,621
|
|
|
21.0
|
%
|
|
$
|
35,859
|
|
|
20.3
|
%
|
|
$
|
167,614
|
|
|
21.2
|
%
|
|
$
|
161,715
|
|
|
20.7
|
%
|
Qdoba:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company restaurant sales
|
|
$
|
107,054
|
|
|
|
|
$
|
88,669
|
|
|
|
|
$
|
415,495
|
|
|
|
|
$
|
374,338
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and packaging
|
|
33,804
|
|
|
31.6
|
%
|
|
27,173
|
|
|
30.6
|
%
|
|
127,464
|
|
|
30.7
|
%
|
|
114,057
|
|
|
30.5
|
%
|
Payroll and employee benefits
|
|
28,241
|
|
|
26.4
|
%
|
|
23,283
|
|
|
26.3
|
%
|
|
111,451
|
|
|
26.8
|
%
|
|
97,704
|
|
|
26.1
|
%
|
Occupancy and other
|
|
26,467
|
|
|
24.7
|
%
|
|
20,937
|
|
|
23.6
|
%
|
|
101,289
|
|
|
24.4
|
%
|
|
88,742
|
|
|
23.7
|
%
|
Total company restaurant costs
|
|
88,512
|
|
|
82.7
|
%
|
|
71,393
|
|
|
80.5
|
%
|
|
340,204
|
|
|
81.9
|
%
|
|
300,503
|
|
|
80.3
|
%
|
Restaurant margin
|
|
$
|
18,542
|
|
|
17.3
|
%
|
|
$
|
17,276
|
|
|
19.5
|
%
|
|
$
|
75,291
|
|
|
18.1
|
%
|
|
$
|
73,835
|
|
|
19.7
|
%
|
|
The following table presents franchise revenues, costs and margin in
each period:
|
SUPPLEMENTAL FRANCHISE OPERATIONS DATA
(Dollars in thousands)
(Unaudited)
|
|
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
October 2, 2016
|
|
September 27, 2015
|
|
October 2, 2016
|
|
September 27, 2015
|
Franchise rental revenues
|
|
$
|
57,689
|
|
|
$
|
52,666
|
|
|
$
|
232,907
|
|
|
$
|
226,702
|
|
|
|
|
|
|
|
|
|
|
Royalties
|
|
39,176
|
|
|
35,100
|
|
|
158,514
|
|
|
152,759
|
|
Franchise fees and other
|
|
861
|
|
|
894
|
|
|
3,375
|
|
|
3,993
|
|
Franchise royalties and other
|
|
40,037
|
|
|
35,994
|
|
|
161,889
|
|
|
156,752
|
|
Total franchise revenues
|
|
97,726
|
|
|
88,660
|
|
|
394,796
|
|
|
383,454
|
|
|
|
|
|
|
|
|
|
|
Rental expense
|
|
34,025
|
|
|
31,638
|
|
|
137,808
|
|
|
136,974
|
|
Depreciation and amortization
|
|
7,652
|
|
|
7,643
|
|
|
32,344
|
|
|
33,128
|
|
Franchise occupancy expenses
|
|
41,677
|
|
|
39,281
|
|
|
170,152
|
|
|
170,102
|
|
Franchise support and other costs
|
|
3,568
|
|
|
3,773
|
|
|
15,991
|
|
|
15,688
|
|
Total franchise costs
|
|
45,245
|
|
|
43,054
|
|
|
186,143
|
|
|
185,790
|
|
Franchise margin
|
|
$
|
52,481
|
|
|
$
|
45,606
|
|
|
$
|
208,653
|
|
|
$
|
197,664
|
|
Franchise margin as a % of franchise revenues
|
|
53.7
|
%
|
|
51.4
|
%
|
|
52.9
|
%
|
|
51.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table provides information related to our operating
segments in each period:
|
SUPPLEMENTAL SEGMENT REPORTING INFORMATION
(In thousands)
(Unaudited)
|
|
|
|
13 Weeks Ended
|
|
12 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
October 2, 2016
|
|
September 27, 2015
|
|
October 2, 2016
|
|
September 27, 2015
|
Revenues by segment:
|
|
|
|
|
|
|
|
|
Jack in the Box restaurant operations
|
|
$
|
286,120
|
|
|
$
|
260,442
|
|
|
$
|
1,162,258
|
|
|
$
|
1,145,176
|
|
Qdoba restaurant operations
|
|
112,299
|
|
|
93,626
|
|
|
437,073
|
|
|
395,141
|
|
Consolidated revenues
|
|
$
|
398,419
|
|
|
$
|
354,068
|
|
|
$
|
1,599,331
|
|
|
$
|
1,540,317
|
|
Earnings from operations by segment:
|
|
|
|
|
|
|
|
|
Jack in the Box restaurant operations
|
|
$
|
71,982
|
|
|
$
|
57,707
|
|
|
$
|
290,346
|
|
|
$
|
265,230
|
|
Qdoba restaurant operations
|
|
13,718
|
|
|
9,999
|
|
|
47,250
|
|
|
47,264
|
|
Shared services and unallocated costs
|
|
(26,796
|
)
|
|
(27,246
|
)
|
|
(108,911
|
)
|
|
(112,182
|
)
|
Gains (losses) on the sale of company-operated restaurants
|
|
6
|
|
|
1,214
|
|
|
1,230
|
|
|
(3,139
|
)
|
Consolidated earnings from operations
|
|
58,910
|
|
|
41,674
|
|
|
229,915
|
|
|
197,173
|
|
Interest expense, net
|
|
8,382
|
|
|
4,866
|
|
|
31,081
|
|
|
18,803
|
|
Consolidated earnings from continuing operations and before income
taxes
|
|
$
|
50,528
|
|
|
$
|
36,808
|
|
|
$
|
198,834
|
|
|
$
|
178,370
|
|
Total depreciation expense by segment:
|
|
|
|
|
|
|
|
|
Jack in the Box restaurant operations
|
|
$
|
15,878
|
|
|
$
|
15,546
|
|
|
$
|
66,287
|
|
|
$
|
64,597
|
|
Qdoba restaurant operations
|
|
4,903
|
|
|
3,924
|
|
|
19,306
|
|
|
17,103
|
|
Shared services and unallocated costs
|
|
1,553
|
|
|
1,633
|
|
|
6,489
|
|
|
7,078
|
|
Consolidated depreciation expense
|
|
$
|
22,334
|
|
|
$
|
21,103
|
|
|
$
|
92,082
|
|
|
$
|
88,778
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table summarizes the changes in the number and mix of Jack
in the Box ("JIB") and Qdoba company and franchise restaurants in each
fiscal year:
|
SUPPLEMENTAL RESTAURANT ACTIVITY INFORMATION
(Unaudited)
|
|
|
|
2016
|
|
2015
|
|
|
Company
|
|
Franchise
|
|
Total
|
|
Company
|
|
Franchise
|
|
Total
|
Jack in the Box:
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
413
|
|
|
1,836
|
|
|
2,249
|
|
|
431
|
|
|
1,819
|
|
|
2,250
|
|
New
|
|
4
|
|
|
12
|
|
|
16
|
|
|
2
|
|
|
16
|
|
|
18
|
|
Refranchised
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
(21
|
)
|
|
21
|
|
|
—
|
|
Acquired from franchisees
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
7
|
|
|
(7
|
)
|
|
—
|
|
Closed
|
|
—
|
|
|
(10
|
)
|
|
(10
|
)
|
|
(6
|
)
|
|
(13
|
)
|
|
(19
|
)
|
End of period
|
|
417
|
|
|
1,838
|
|
|
2,255
|
|
|
413
|
|
|
1,836
|
|
|
2,249
|
|
% of JIB system
|
|
18
|
%
|
|
82
|
%
|
|
100
|
%
|
|
18
|
%
|
|
82
|
%
|
|
100
|
%
|
Qdoba:
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
322
|
|
|
339
|
|
|
661
|
|
|
310
|
|
|
328
|
|
|
638
|
|
New
|
|
35
|
|
|
18
|
|
|
53
|
|
|
17
|
|
|
22
|
|
|
39
|
|
Acquired from franchisees
|
|
14
|
|
|
(14
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Closed
|
|
(4
|
)
|
|
(11
|
)
|
|
(15
|
)
|
|
(5
|
)
|
|
(11
|
)
|
|
(16
|
)
|
End of period
|
|
367
|
|
|
332
|
|
|
699
|
|
|
322
|
|
|
339
|
|
|
661
|
|
% of Qdoba system
|
|
53
|
%
|
|
47
|
%
|
|
100
|
%
|
|
49
|
%
|
|
51
|
%
|
|
100
|
%
|
Consolidated:
|
|
|
|
|
|
|
|
|
|
|
|
|
Total system end of period
|
|
784
|
|
|
2,170
|
|
|
2,954
|
|
|
735
|
|
|
2,175
|
|
|
2,910
|
|
% of consolidated system
|
|
27
|
%
|
|
73
|
%
|
|
100
|
%
|
|
25
|
%
|
|
75
|
%
|
|
100
|
%
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20161121006089/en/
Source: Jack in the Box Inc.
Jack in the Box Inc.
Investor Contact:
Carol DiRaimo,
(858) 571-2407
or
Media Contact:
Brian Luscomb,
(858) 571-2291