SAN DIEGO--(BUSINESS WIRE)--Feb. 22, 2017--
Jack in the Box Inc. (NASDAQ: JACK) today reported earnings from
continuing operations of $37.0 million, or $1.14 per diluted share, for
the first quarter ended January 22, 2017, compared with $33.9 million,
or $0.94 per diluted share, for the first quarter of fiscal 2016.
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 $1.18 in the first quarter of fiscal 2017 compared
with $0.93 in the prior year quarter.
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.
|
|
Sixteen Weeks Ended
|
|
|
January 22, 2017
|
|
January 17, 2016
|
Diluted earnings per share from continuing operations – GAAP
|
|
$
|
1.14
|
|
$
|
0.94
|
|
Restructuring charges
|
|
|
0.04
|
|
|
—
|
|
Gains from refranchising
|
|
|
—
|
|
|
(0.01
|
)
|
Operating earnings per share – Non-GAAP
|
|
$
|
1.18
|
|
$
|
0.93
|
|
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 $2.0 million, or approximately $0.04
per diluted share, were recorded during the first quarter of fiscal
2017. Charges consist primarily of facility closing costs and employee
severance pay. These charges are included in “impairment and other
charges, net” in the accompanying condensed consolidated statements of
earnings.
Lenny Comma, chairman and chief executive officer, said, “Our first
quarter results were mixed, with solid results at the Jack in the Box®
brand offset by lower than expected sales and disappointing margins at
Qdoba®. We are intent on improving the performance of the
Qdoba brand with priorities focused on driving sales growth and managing
labor and food costs more effectively.
“We were pleased that Jack in the Box system same-store sales
outperformed sluggish industry trends during the quarter. And despite
the weaker Qdoba results, our commitments to reduce G&A and to return
cash to shareholders contributed to a 27 percent increase in operating
earnings per share for the quarter.
“Consistent with restaurant and retail industry data, we've seen an
abrupt downturn in February sales trends for both brands. We believe
some of this slowdown may be attributable to delayed tax refunds, as
well as record rainfall and flooding in California over the past few
weeks which have impacted our Jack in the Box results.
“We've made good progress on our refranchising initiative, and as of
today, have signed non-binding letters of intent with franchisees to
sell approximately 75 restaurants in several different markets.”
Increase/(decrease) in same-store sales:
|
|
Sixteen Weeks Ended
|
|
|
January 22, 2017 *
|
|
January 17, 2016
|
Jack in the Box:
|
|
|
|
|
Company
|
|
0.6%
|
|
0.5%
|
Franchise
|
|
3.9%
|
|
1.8%
|
System
|
|
3.1%
|
|
1.4%
|
Qdoba:
|
|
|
|
|
Company
|
|
(1.4)%
|
|
1.5%
|
Franchise
|
|
(0.5)%
|
|
2.1%
|
System
|
|
(1.0)%
|
|
1.8%
|
*Note: Due to the transition from a 53-week to a 52-week fiscal
year, year-over-year fiscal period comparisons are offset by one
week. The change in same-store sales presented in the 2017 column
uses comparable calendar periods to balance the one-week shift and
to provide a clearer year-over-year comparison.
|
Jack in the Box system same-store sales increased 3.1 percent for the
quarter and exceeded the QSR sandwich segment by 1.6 percentage points
for the comparable period, according to The NPD Group’s SalesTrack®
Weekly for the 16-week time period ended January 22, 2017. Included in
this segment are 16 of the top QSR sandwich and burger chains in the
country. Company same-store sales increased 0.6 percent in the first
quarter, with average check up 4.9 percent.
Qdoba same-store sales decreased 1.0 percent system-wide and 1.4 percent
for company restaurants in the first quarter. Company same-store sales
reflected a 2.5 percent decrease in transactions, partially offset by
growth in average check and catering sales.
Consolidated restaurant operating margin decreased by 90 basis points to
18.6 percent of sales in the first quarter of 2017, compared with 19.5
percent of sales in the year-ago quarter. Restaurant operating margin
for Jack in the Box company restaurants increased 70 basis points to
21.6 percent of sales. The increase was due primarily to lower costs for
food and packaging, partially offset by minimum wage increases in
California that went into effect in January 2016 and January 2017. The
decrease in food and packaging costs as a percentage of sales resulted
from the benefit of commodity deflation of approximately 5.6 percent in
the quarter, favorable product mix changes and menu price increases.
Restaurant operating margin for Qdoba company restaurants decreased 350
basis points to 13.1 percent of sales. The decrease was due primarily to
the impact of new restaurant openings over the last 12 months, sales
deleverage, labor staffing inefficiencies and wage inflation, and higher
costs for food and packaging. The increase in food and packaging costs
as a percentage of sales was impacted by increased promotional activity,
partially offset by the benefits from commodity deflation of
approximately 3.0 percent in the quarter.
Franchise margin as a percentage of total franchise revenues improved to
54.2 percent in the first quarter from 51.5 percent in the prior year
quarter. The improvement was due primarily to higher royalty revenue and
rental income from Jack in the Box franchised restaurants resulting from
increases in franchise average unit volumes, and a decrease in franchise
costs.
SG&A expense for the first quarter decreased by $10.2 million and was
11.4 percent of revenues as compared to 14.0 percent in the prior year
quarter. Key items contributing to the decrease were the impact of the
company's restructuring activities, including a $2.9 million decrease in
pension and postretirement benefits, as well as a $1.7 million decrease
in incentive compensation.
Interest expense, net, increased by $4.5 million in the first quarter
due to increased leverage and a higher effective interest rate for 2017.
The tax rate for the first quarter of 2017 was 38.7 percent versus 37.6
percent for the first quarter of 2016. The higher tax rate in the first
quarter of 2017 was due primarily to a decrease in work opportunity tax
credits.
Capital Allocation
The company repurchased approximately 992,000 shares of its common stock
in the first quarter of 2017 at an average price of $109.04 per share
for an aggregate cost of $108.1 million. This leaves approximately $300
million remaining under stock buyback programs authorized by the
company's Board of Directors.
The company also announced today that on February 21, 2017, its Board of
Directors declared a quarterly cash dividend of $0.40 per share on the
company’s common stock. The dividend is payable on March 20, 2017, to
shareholders of record at the close of business on March 7, 2017.
Guidance
The following guidance and underlying assumptions reflect the company’s
current expectations for the second quarter ending April 16, 2017, and
fiscal year ending October 1, 2017. Fiscal 2017 is a 52-week year, with
16 weeks in the first quarter, and 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.
Second quarter fiscal year 2017 guidance
-
Same-store sales of flat to down 2.0 percent at Jack in the Box system
restaurants versus flat same-store sales in the year-ago quarter.
-
Same-store sales of down 1.0 to 3.0 percent at Qdoba company
restaurants versus a 3.1 percent increase in the year-ago quarter.
Fiscal year 2017 guidance
-
Same-store sales increase of approximately 2.0 percent at Jack in the
Box system restaurants.
-
Same-store sales of approximately flat at Qdoba company restaurants.
-
Commodity deflation of approximately flat to down 1.0 percent for both
Jack in the Box and Qdoba.
-
Consolidated restaurant operating margin of approximately 19.5 to 20.0
percent, depending on the timing of refranchising transactions and the
margins associated with the restaurants sold.
-
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 50 to 60 new Qdoba restaurants, of which approximately
30 are expected to be company locations.
-
Capital expenditures of approximately $100 million.
-
Tax rate of approximately 38.0 to 39.0 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 $4.25 to $4.45. This guidance assumes
share repurchases of approximately $408 million during the year,
representing the amount remaining under Board authorizations at the
beginning of the fiscal year.
Conference call
The company will host a conference call for financial analysts and
investors on Thursday, February 23, 2017, 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 February 23, 2017.
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 more than 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.
|
|
Sixteen Weeks Ended
|
|
|
January 22, 2017
|
|
January 17, 2016
|
Diluted earnings per share from continuing operations – GAAP
|
|
$
|
1.14
|
|
$
|
0.94
|
|
Restructuring charges
|
|
|
0.04
|
|
|
—
|
|
Gains from refranchising
|
|
|
—
|
|
|
(0.01
|
)
|
Operating earnings per share – Non-GAAP
|
|
$
|
1.18
|
|
$
|
0.93
|
|
|
JACK IN THE BOX INC. AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
|
(In thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
Sixteen Weeks Ended
|
|
|
|
January 22, 2017
|
|
|
January 17, 2016
|
Revenues:
|
|
|
|
|
|
|
Company restaurant sales
|
|
|
$
|
367,270
|
|
|
|
$
|
353,221
|
|
Franchise rental revenues
|
|
|
71,469
|
|
|
|
69,738
|
|
Franchise royalties and other
|
|
|
49,194
|
|
|
|
47,864
|
|
|
|
|
487,933
|
|
|
|
470,823
|
|
Operating costs and expenses, net:
|
|
|
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
Food and packaging
|
|
|
108,936
|
|
|
|
108,911
|
|
Payroll and employee benefits
|
|
|
106,921
|
|
|
|
97,907
|
|
Occupancy and other
|
|
|
83,044
|
|
|
|
77,699
|
|
Total company restaurant costs
|
|
|
298,901
|
|
|
|
284,517
|
|
Franchise occupancy expenses
|
|
|
51,449
|
|
|
|
52,219
|
|
Franchise support and other costs
|
|
|
3,838
|
|
|
|
4,862
|
|
Selling, general and administrative expenses
|
|
|
55,708
|
|
|
|
65,872
|
|
Impairment and other charges, net
|
|
|
5,057
|
|
|
|
1,657
|
|
Gains on the sale of company-operated restaurants
|
|
|
(137
|
)
|
|
|
(818
|
)
|
|
|
|
414,816
|
|
|
|
408,309
|
|
Earnings from operations
|
|
|
73,117
|
|
|
|
62,514
|
|
Interest expense, net
|
|
|
12,717
|
|
|
|
8,175
|
|
Earnings from continuing operations and before income taxes
|
|
|
60,400
|
|
|
|
54,339
|
|
Income taxes
|
|
|
23,366
|
|
|
|
20,442
|
|
Earnings from continuing operations
|
|
|
37,034
|
|
|
|
33,897
|
|
Losses from discontinued operations, net of income tax benefit
|
|
|
(1,105
|
)
|
|
|
(676
|
)
|
Net earnings
|
|
|
$
|
35,929
|
|
|
|
$
|
33,221
|
|
|
|
|
|
|
|
|
Net earnings per share - basic:
|
|
|
|
|
|
|
Earnings from continuing operations
|
|
|
$
|
1.15
|
|
|
|
$
|
0.96
|
|
Losses from discontinued operations
|
|
|
(0.03
|
)
|
|
|
(0.02
|
)
|
Net earnings per share (1)
|
|
|
$
|
1.12
|
|
|
|
$
|
0.94
|
|
Net earnings per share - diluted:
|
|
|
|
|
|
|
Earnings from continuing operations
|
|
|
$
|
1.14
|
|
|
|
$
|
0.94
|
|
Losses from discontinued operations
|
|
|
(0.03
|
)
|
|
|
(0.02
|
)
|
Net earnings per share (1)
|
|
|
$
|
1.11
|
|
|
|
$
|
0.92
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
Basic
|
|
|
32,168
|
|
|
|
35,458
|
|
Diluted
|
|
|
32,442
|
|
|
|
35,946
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share
|
|
|
$
|
0.40
|
|
|
|
$
|
0.30
|
|
____________________________
(1)
|
|
Earnings per share may not add due to rounding.
|
|
|
|
|
JACK IN THE BOX INC. AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In thousands, except share and per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
January 22, 2017
|
|
|
October 2, 2016
|
ASSETS
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash
|
|
|
$
|
6,090
|
|
|
|
$
|
17,030
|
|
Accounts and other receivables, net
|
|
|
54,711
|
|
|
|
73,360
|
|
Inventories
|
|
|
8,344
|
|
|
|
8,229
|
|
Prepaid expenses
|
|
|
12,631
|
|
|
|
40,398
|
|
Assets held for sale
|
|
|
18,357
|
|
|
|
14,259
|
|
Other current assets
|
|
|
2,371
|
|
|
|
2,129
|
|
Total current assets
|
|
|
102,504
|
|
|
|
155,405
|
|
Property and equipment, at cost
|
|
|
1,596,676
|
|
|
|
1,605,576
|
|
Less accumulated depreciation and amortization
|
|
|
(899,077
|
)
|
|
|
(886,526
|
)
|
Property and equipment, net
|
|
|
697,599
|
|
|
|
719,050
|
|
Intangible assets, net
|
|
|
13,793
|
|
|
|
14,042
|
|
Goodwill
|
|
|
166,045
|
|
|
|
166,046
|
|
Other assets, net
|
|
|
278,616
|
|
|
|
290,469
|
|
|
|
|
$
|
1,258,557
|
|
|
|
$
|
1,345,012
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
Current maturities of long-term debt
|
|
|
$
|
55,931
|
|
|
|
$
|
55,935
|
|
Accounts payable
|
|
|
30,052
|
|
|
|
40,736
|
|
Accrued liabilities
|
|
|
134,701
|
|
|
|
181,250
|
|
Total current liabilities
|
|
|
220,684
|
|
|
|
277,921
|
|
Long-term debt, net of current maturities
|
|
|
985,588
|
|
|
|
935,372
|
|
Other long-term liabilities
|
|
|
325,526
|
|
|
|
348,925
|
|
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,
81,824,541 and 81,598,524 issued, respectively
|
|
|
818
|
|
|
|
816
|
|
Capital in excess of par value
|
|
|
445,147
|
|
|
|
432,564
|
|
Retained earnings
|
|
|
1,422,614
|
|
|
|
1,399,721
|
|
Accumulated other comprehensive loss
|
|
|
(170,388
|
)
|
|
|
(187,021
|
)
|
Treasury stock, at cost, 50,182,807 and 49,190,992 shares,
respectively
|
|
|
(1,971,432
|
)
|
|
|
(1,863,286
|
)
|
Total stockholders’ deficit
|
|
|
(273,241
|
)
|
|
|
(217,206
|
)
|
|
|
|
$
|
1,258,557
|
|
|
|
$
|
1,345,012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
JACK IN THE BOX INC. AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
Sixteen Weeks Ended
|
|
|
|
January 22, 2017
|
|
|
January 17, 2016
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Net earnings
|
|
|
$
|
35,929
|
|
|
|
$
|
33,221
|
|
Adjustments to reconcile net earnings to net cash provided by
operating activities:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
27,987
|
|
|
|
28,514
|
|
Deferred finance cost amortization
|
|
|
1,123
|
|
|
|
823
|
|
Excess tax benefits from share-based compensation arrangements
|
|
|
(3,981
|
)
|
|
|
(2,020
|
)
|
Deferred income taxes
|
|
|
2,239
|
|
|
|
(2,128
|
)
|
Share-based compensation expense
|
|
|
3,814
|
|
|
|
4,088
|
|
Pension and postretirement expense
|
|
|
1,297
|
|
|
|
4,149
|
|
Losses on cash surrender value of company-owned life insurance
|
|
|
326
|
|
|
|
2,466
|
|
Gains on the sale of company-operated restaurants
|
|
|
(137
|
)
|
|
|
(818
|
)
|
Losses on the disposition of property and equipment
|
|
|
699
|
|
|
|
651
|
|
Impairment charges and other
|
|
|
1,871
|
|
|
|
446
|
|
Changes in assets and liabilities:
|
|
|
|
|
|
|
Accounts and other receivables
|
|
|
19,378
|
|
|
|
(4,204
|
)
|
Inventories
|
|
|
(115
|
)
|
|
|
(495
|
)
|
Prepaid expenses and other current assets
|
|
|
31,506
|
|
|
|
1,205
|
|
Accounts payable
|
|
|
(5,487
|
)
|
|
|
7,386
|
|
Accrued liabilities
|
|
|
(43,328
|
)
|
|
|
(25,403
|
)
|
Pension and postretirement contributions
|
|
|
(1,440
|
)
|
|
|
(1,883
|
)
|
Other
|
|
|
(726
|
)
|
|
|
(1,089
|
)
|
Cash flows provided by operating activities
|
|
|
70,955
|
|
|
|
44,909
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
Purchases of property and equipment
|
|
|
(20,865
|
)
|
|
|
(31,543
|
)
|
Purchases of assets intended for sale and leaseback
|
|
|
(1,770
|
)
|
|
|
(3,274
|
)
|
Proceeds from the sale and leaseback of assets
|
|
|
2,466
|
|
|
|
5,803
|
|
Proceeds from the sale of company-operated restaurants
|
|
|
138
|
|
|
|
1,021
|
|
Collections on notes receivable
|
|
|
298
|
|
|
|
441
|
|
Acquisition of franchise-operated restaurants
|
|
|
—
|
|
|
|
324
|
|
Other
|
|
|
51
|
|
|
|
(28
|
)
|
Cash flows used in investing activities
|
|
|
(19,682
|
)
|
|
|
(27,256
|
)
|
Cash flows from financing activities:
|
|
|
|
|
|
|
Borrowings on revolving credit facilities
|
|
|
231,000
|
|
|
|
176,000
|
|
Repayments of borrowings on revolving credit facilities
|
|
|
(167,000
|
)
|
|
|
(97,000
|
)
|
Principal repayments on debt
|
|
|
(14,438
|
)
|
|
|
(8,479
|
)
|
Dividends paid on common stock
|
|
|
(12,962
|
)
|
|
|
(10,592
|
)
|
Proceeds from issuance of common stock
|
|
|
4,756
|
|
|
|
492
|
|
Repurchases of common stock
|
|
|
(115,354
|
)
|
|
|
(100,000
|
)
|
Excess tax benefits from share-based compensation arrangements
|
|
|
3,981
|
|
|
|
2,020
|
|
Change in book overdraft
|
|
|
7,804
|
|
|
|
9,295
|
|
Cash flows used in financing activities
|
|
|
(62,213
|
)
|
|
|
(28,264
|
)
|
Effect of exchange rate changes on cash
|
|
|
—
|
|
|
|
(32
|
)
|
Net decrease in cash
|
|
|
(10,940
|
)
|
|
|
(10,643
|
)
|
Cash at beginning of period
|
|
|
17,030
|
|
|
|
17,743
|
|
Cash at end of period
|
|
|
$
|
6,090
|
|
|
|
$
|
7,100
|
|
|
|
|
|
|
|
|
|
|
|
|
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)
|
|
|
|
|
|
|
|
Sixteen Weeks Ended
|
|
|
|
January 22, 2017
|
|
|
January 17, 2016
|
Revenues:
|
|
|
|
|
|
|
Company restaurant sales
|
|
|
75.3
|
%
|
|
|
75.0
|
%
|
Franchise rental revenues
|
|
|
14.6
|
%
|
|
|
14.8
|
%
|
Franchise royalties and other
|
|
|
10.1
|
%
|
|
|
10.2
|
%
|
Total revenues
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
Operating costs and expenses, net:
|
|
|
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
Food and packaging (1)
|
|
|
29.7
|
%
|
|
|
30.8
|
%
|
Payroll and employee benefits (1)
|
|
|
29.1
|
%
|
|
|
27.7
|
%
|
Occupancy and other (1)
|
|
|
22.6
|
%
|
|
|
22.0
|
%
|
Total company restaurant costs (1)
|
|
|
81.4
|
%
|
|
|
80.5
|
%
|
Franchise occupancy expenses (2)
|
|
|
72.0
|
%
|
|
|
74.9
|
%
|
Franchise support and other costs (3)
|
|
|
7.8
|
%
|
|
|
10.2
|
%
|
Selling, general and administrative expenses
|
|
|
11.4
|
%
|
|
|
14.0
|
%
|
Impairment and other charges, net
|
|
|
1.0
|
%
|
|
|
0.4
|
%
|
Gains on the sale of company-operated restaurants
|
|
|
—
|
%
|
|
|
(0.2
|
)%
|
Earnings from operations
|
|
|
15.0
|
%
|
|
|
13.3
|
%
|
Income tax rate (4)
|
|
|
38.7
|
%
|
|
|
37.6
|
%
|
____________________________
(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)
|
|
|
|
|
|
|
|
Sixteen Weeks Ended
|
|
|
|
January 22, 2017
|
|
|
January 17, 2016
|
Jack in the Box:
|
|
|
|
|
|
|
|
|
|
|
|
|
Company restaurant sales
|
|
|
$
|
238,571
|
|
|
|
|
|
|
$
|
236,279
|
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and packaging
|
|
|
67,989
|
|
|
|
28.5
|
%
|
|
|
73,133
|
|
|
|
31.0
|
%
|
Payroll and employee benefits
|
|
|
70,183
|
|
|
|
29.4
|
%
|
|
|
65,689
|
|
|
|
27.8
|
%
|
Occupancy and other
|
|
|
48,850
|
|
|
|
20.5
|
%
|
|
|
48,171
|
|
|
|
20.4
|
%
|
Total company restaurant costs
|
|
|
187,022
|
|
|
|
78.4
|
%
|
|
|
186,993
|
|
|
|
79.1
|
%
|
Restaurant margin
|
|
|
$
|
51,549
|
|
|
|
21.6
|
%
|
|
|
$
|
49,286
|
|
|
|
20.9
|
%
|
Qdoba:
|
|
|
|
|
|
|
|
|
|
|
|
|
Company restaurant sales
|
|
|
$
|
128,699
|
|
|
|
|
|
|
$
|
116,942
|
|
|
|
|
Company restaurant costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and packaging
|
|
|
40,947
|
|
|
|
31.8
|
%
|
|
|
35,778
|
|
|
|
30.6
|
%
|
Payroll and employee benefits
|
|
|
36,738
|
|
|
|
28.5
|
%
|
|
|
32,218
|
|
|
|
27.6
|
%
|
Occupancy and other
|
|
|
34,194
|
|
|
|
26.6
|
%
|
|
|
29,528
|
|
|
|
25.3
|
%
|
Total company restaurant costs
|
|
|
111,879
|
|
|
|
86.9
|
%
|
|
|
97,524
|
|
|
|
83.4
|
%
|
Restaurant margin
|
|
|
$
|
16,820
|
|
|
|
13.1
|
%
|
|
|
$
|
19,418
|
|
|
|
16.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents franchise revenues, costs and margin in
each period:
|
SUPPLEMENTAL FRANCHISE OPERATIONS DATA
|
(Dollars in thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
Sixteen Weeks Ended
|
|
|
|
January 22, 2017
|
|
|
January 17, 2016
|
Franchise rental revenues
|
|
|
$
|
71,469
|
|
|
|
$
|
69,738
|
|
|
|
|
|
|
|
|
Royalties
|
|
|
48,019
|
|
|
|
46,662
|
|
Franchise fees and other
|
|
|
1,175
|
|
|
|
1,202
|
|
Franchise royalties and other
|
|
|
49,194
|
|
|
|
47,864
|
|
Total franchise revenues
|
|
|
120,663
|
|
|
|
117,602
|
|
|
|
|
|
|
|
|
Rental expense
|
|
|
42,223
|
|
|
|
42,172
|
|
Depreciation and amortization
|
|
|
9,226
|
|
|
|
10,047
|
|
Franchise occupancy expenses
|
|
|
51,449
|
|
|
|
52,219
|
|
Franchise support and other costs
|
|
|
3,838
|
|
|
|
4,862
|
|
Total franchise costs
|
|
|
55,287
|
|
|
|
57,081
|
|
Franchise margin
|
|
|
$
|
65,376
|
|
|
|
$
|
60,521
|
|
Franchise margin as a % of franchise revenues
|
|
|
54.2
|
%
|
|
|
51.5
|
%
|
|
|
|
|
|
|
|
|
|
The following table provides information related to our operating
segments in each period:
|
SUPPLEMENTAL SEGMENT REPORTING INFORMATION
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
Sixteen Weeks Ended
|
|
|
|
January 22, 2017
|
|
|
January 17, 2016
|
Revenues by segment:
|
|
|
|
|
|
|
Jack in the Box restaurant operations
|
|
|
$
|
353,181
|
|
|
|
$
|
347,583
|
|
Qdoba restaurant operations
|
|
|
134,752
|
|
|
|
123,240
|
|
Consolidated revenues
|
|
|
$
|
487,933
|
|
|
|
$
|
470,823
|
|
Earnings from operations by segment:
|
|
|
|
|
|
|
Jack in the Box restaurant operations
|
|
|
$
|
92,404
|
|
|
|
$
|
85,690
|
|
Qdoba restaurant operations
|
|
|
8,732
|
|
|
|
8,737
|
|
Shared services and unallocated costs
|
|
|
(28,156
|
)
|
|
|
(32,731
|
)
|
Gains on the sale of company-operated restaurants
|
|
|
137
|
|
|
|
818
|
|
Consolidated earnings from operations
|
|
|
73,117
|
|
|
|
62,514
|
|
Interest expense, net
|
|
|
12,717
|
|
|
|
8,175
|
|
Consolidated earnings from continuing operations and before income
taxes
|
|
|
$
|
60,400
|
|
|
|
$
|
54,339
|
|
Total depreciation expense by segment:
|
|
|
|
|
|
|
Jack in the Box restaurant operations
|
|
|
$
|
19,289
|
|
|
|
$
|
20,473
|
|
Qdoba restaurant operations
|
|
|
6,492
|
|
|
|
5,588
|
|
Shared services and unallocated costs
|
|
|
1,974
|
|
|
|
2,225
|
|
Consolidated depreciation expense
|
|
|
$
|
27,755
|
|
|
|
$
|
28,286
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table summarizes the year-to-date changes in the number
and mix of Jack in the Box ("JIB") and Qdoba company and franchise
restaurants:
|
SUPPLEMENTAL RESTAURANT ACTIVITY INFORMATION
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
January 22, 2017
|
|
|
January 17, 2016
|
|
|
|
Company
|
|
|
Franchise
|
|
|
Total
|
|
|
Company
|
|
|
Franchise
|
|
|
Total
|
Jack in the Box:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
|
417
|
|
|
|
1,838
|
|
|
|
2,255
|
|
|
|
413
|
|
|
|
1,836
|
|
|
|
2,249
|
|
New
|
|
|
2
|
|
|
|
7
|
|
|
|
9
|
|
|
|
—
|
|
|
|
5
|
|
|
|
5
|
|
Refranchised
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1
|
)
|
|
|
1
|
|
|
|
—
|
|
Acquired from franchisees
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
|
(1
|
)
|
|
|
—
|
|
Closed
|
|
|
—
|
|
|
|
(3
|
)
|
|
|
(3
|
)
|
|
|
—
|
|
|
|
(1
|
)
|
|
|
(1
|
)
|
End of period
|
|
|
419
|
|
|
|
1,842
|
|
|
|
2,261
|
|
|
|
413
|
|
|
|
1,840
|
|
|
|
2,253
|
|
% of JIB system
|
|
|
19
|
%
|
|
|
81
|
%
|
|
|
100
|
%
|
|
|
18
|
%
|
|
|
82
|
%
|
|
|
100
|
%
|
Qdoba:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
|
367
|
|
|
|
332
|
|
|
|
699
|
|
|
|
322
|
|
|
|
339
|
|
|
|
661
|
|
New
|
|
|
9
|
|
|
|
8
|
|
|
|
17
|
|
|
|
9
|
|
|
|
6
|
|
|
|
15
|
|
Closed
|
|
|
—
|
|
|
|
(4
|
)
|
|
|
(4
|
)
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
(2
|
)
|
End of period
|
|
|
376
|
|
|
|
336
|
|
|
|
712
|
|
|
|
330
|
|
|
|
344
|
|
|
|
674
|
|
% of Qdoba system
|
|
|
53
|
%
|
|
|
47
|
%
|
|
|
100
|
%
|
|
|
49
|
%
|
|
|
51
|
%
|
|
|
100
|
%
|
Consolidated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total system end of period
|
|
|
795
|
|
|
|
2,178
|
|
|
|
2,973
|
|
|
|
743
|
|
|
|
2,184
|
|
|
|
2,927
|
|
% of consolidated system
|
|
|
27
|
%
|
|
|
73
|
%
|
|
|
100
|
%
|
|
|
25
|
%
|
|
|
75
|
%
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20170222006481/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