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8-K
false 0000049754 0000049754 2020-02-24 2020-02-24

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): February 24, 2020

 

Dine Brands Global, Inc.

(Exact Name of Registrant as Specified in Charter)

 

Delaware

 

001-15283

 

95-3038279

(State or other jurisdiction

of incorporation or

organization)

 

(Commission File

No.)

 

(I.R.S. Employer

Identification No.)

450 North Brand Boulevard, Glendale,

California

 

91203-2306

(Address of principal executive offices)

 

(Zip Code)

(818) 240-6055

(Registrant’s telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, $.01 Par Value

 

DIN

 

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 


Item 2.02 Results of Operations and Financial Condition

On February 24, 2020, Dine Brands Global, Inc., a Delaware corporation (the “Corporation”), issued a press release announcing its fourth quarter and fiscal 2019 financial results. A copy of the press release is attached hereto as Exhibit 99.1, and is incorporated herein by reference.

The information contained in this Item 2.02, including the related information set forth in the press release attached hereto as Exhibit 99.1 and incorporated by reference herein, is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise. The information in this Item 2.02 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, or into any filing or other document pursuant to the Exchange Act, except as otherwise expressly stated in any such filing.

Item 7.01 Regulation FD

The press release referenced in Item 2.02 of this Current Report on Form 8-K also includes information concerning the Corporation’s 2020 financial outlook. A copy of the press release is attached hereto as Exhibit 99.1, and is incorporated herein by reference.

The information contained in this Item 7.01, including the related information set forth in the press release attached hereto as Exhibit 99.1 and incorporated by reference herein, is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act or otherwise. The information in this Item 7.01 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, or into any filing or other document pursuant to the Exchange Act, except as otherwise expressly stated in any such filing.

Item 8.01 Other Events.

On February 24, 2020, the Corporation issued a press release announcing that the Board of Directors of the Corporation declared a first quarter 2020 cash dividend of $0.76 per share of common stock, payable on April 3, 2020, to the Corporation’s stockholders of record as of the close of business on March 20, 2020. A copy of the press release is attached hereto as Exhibit 99.2 and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit
Number        

   

Description

         
 

99.1

   

Press Release issued by the Corporation on February 24, 2020.

         
 

99.2

   

Press Release issued by the Corporation on February 24, 2020.

         
 

104

   

Cover Page Interactive Data File (embedded within the Inline XBRL document).


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: February 24, 2020

     

DINE BRANDS GLOBAL, INC.

             

     

By:    

 

/s/ Thomas H. Song                                                

     

 

Thomas H. Song

     

 

Chief Financial Officer

3

EX-99.1

Exhibit 99.1

 

LOGO     

 

 

    News Release

Investor Contact

Ken Diptee

Executive Director, Investor Relations

Dine Brands Global, Inc.

818-637-3632

Media Contact

Susan Nelson

Vice President, Global Communications

and Public Affairs

Dine Brands Global, Inc.

818-637-4726

Dine Brands Global, Inc. Reports Solid Fourth Quarter and Full-Year 2019 Results

Fourth Quarter Earnings Per Diluted Share (GAAP) Increased 8.2%

Fourth Quarter Adjusted Earnings Per Diluted Share (Non-GAAP) Increased 4.7%

Full-Year Earnings Per Diluted Share (GAAP) Increased 33.9%

Full-Year Adjusted Earnings Per Diluted Share (Non-GAAP) Increased 29.4%

GLENDALE, Calif., February 24, 2020 – Dine Brands Global, Inc. (NYSE: DIN), the parent company of Applebee’s Neighborhood Grill + Bar® and IHOP® restaurants, today announced financial results for the fourth quarter and fiscal 2019.

“This past year for Dine Brands was defined by several significant achievements. Notably, we successfully completed a $1.3 billion refinancing of our existing debt through a securitization. We delivered a significant increase in net income of 30%, which resulted in strong growth in adjusted EBITDA of 19% for the year. Our franchised business model continued to generate robust adjusted free cash flow, enabling us to both return capital to shareholders and invest in technology. We also drove significant growth in our off-premise business at both Applebee’s and IHOP and launched domestic development initiatives at IHOP to expand our footprint in high-demand locations,” said Steve Joyce, Chief Executive Officer of Dine Brands Global, Inc.

Mr. Joyce added, “We’ve built a solid foundation for sustainable growth. While we are pleased with our success, we will not be complacent. Looking ahead, we will leverage our accomplishments and focus on guest-centric decisions and opportunities that will deliver long-term profitability. We’re excited about our future and confident in our ability to build momentum.”


Page 2 of 16

 

Financial Summary

 

($ in 000’s, except per share amounts)    Fourth Quarter         Fiscal Year
      2019    2018    % Change        2019    2018    % Change

Total revenues, excluding advertising revenues

   $156,378    $139,461    12.1%      $627,163    $512,637    22.3%
Total revenues, excluding Company restaurant sales    $196,331    $207,114    -5.2%      $778,964    $773,847    0.7%
Diluted net income available to common stockholders per share    $1.59    $1.47    8.2%      $5.85    $4.37    33.9%
Diluted net income available to common stockholders per share, as adjusted(1)    $1.78    $1.70    4.7%      $6.95    $5.37    29.4%

Net income

   $27,396    $26,981    1.5%      $104,346    $80,354    29.9%

Consolidated adjusted EBITDA(1)(2)

   $67,481    $65,027    3.8%        $273,546    $230,590    18.6%

 

(1)

See “Non-GAAP Financial Measures” and reconciliation of the Non-GAAP financial measure to the respective GAAP financial measure.

(2)

Does not conform to the definition of Covenant Adjusted EBITDA as found in the Base Indenture.

Fourth Quarter and Fiscal 2019 Key Highlights

 

   

GAAP earnings per diluted share for the fourth quarter of 2019 increased 8.2% year-over-year to $1.59.

 

   

Adjusted earnings per diluted share for the fourth quarter of 2019 increased 4.7% year-over-year to $1.78. (See “Non-GAAP Financial Measures” and reconciliation of GAAP earnings per diluted share to adjusted earnings per diluted share.)

 

   

GAAP earnings per diluted share for fiscal 2019 increased 33.9% year-over-year to $5.85.

 

   

Adjusted earnings per diluted share for fiscal 2019 increased 29.4% year-over-year to $6.95. (See “Non-GAAP Financial Measures” and reconciliation of GAAP earnings per diluted share to adjusted earnings per diluted share.)

 

   

IHOP’s comparable same-restaurant sales increased 1.1% for the fourth quarter of 2019, achieving the eighth consecutive quarter of sales growth.

 

   

Applebee’s franchisees completed three transactions in 2019, bringing new and deeply experienced operators into the domestic system.

 

   

IHOP’s franchisees completed over 200 remodels in 2019, bringing the total number of domestic restaurants remodeled to approximately 1,100 since the inception of the current program.

 

   

IHOP’s reported system-wide sales for the fourth quarter of 2019 increased 2.1% year-over-year to $882.2 million.

 

   

General and administrative expenses for the fourth quarter of 2019 declined 7.8% year-over-year to $41.7 million.

 

   

Net income for fiscal 2019 increased 29.9% year-over-year to $104.3 million.


Page 3 of 16

 

   

Consolidated adjusted EBITDA for fiscal 2019 increased 18.6% to $273.5 million compared to $230.6 million for fiscal 2018. (See “Non-GAAP Financial Measures” and reconciliation of GAAP net income to consolidated adjusted EBITDA.)

 

   

Cash flows from operating activities for fiscal 2019 increased 10.6% to $155.2 million compared to $140.3 million for fiscal 2018.

 

   

Adjusted free cash flow for fiscal 2019 increased 5.6% to $148.8 million compared to $140.9 million for fiscal 2018. (See “Non-GAAP Financial Measures” and reconciliation of the Company’s cash provided by operating activities to adjusted free cash flow.)

 

   

For 2019, the Company repurchased over 1.3 million shares of its common stock for a total cost of $111.7 million and paid quarterly cash dividends totaling $46.9 million.

Domestic System-Wide Comparable Same-Restaurant Sales Performance

Fourth Quarter of 2019

 

   

IHOP’s comparable same-restaurant sales increased 1.1% for the fourth quarter of 2019.

 

   

Applebee’s comparable same-restaurant sales decreased 2.5% for the fourth quarter of 2019.

Fiscal 2019

 

   

IHOP’s comparable same-restaurant sales increased 1.1% for 2019.

 

   

Applebee’s comparable same-restaurant sales decreased 0.7% for 2019.

Fourth Quarter of 2019 Financial Highlights    

 

   

GAAP net income available to common stockholders was $26.5 million, or earnings per diluted share of $1.59, for the fourth quarter of 2019. This compares to net income available to common stockholders of $26.1 million, or earnings per diluted share of $1.47, for the fourth quarter of 2018. The increase in net income was primarily due to lower general and administrative expenses. These items were partially offset by a decline in gross profit.

 

   

Adjusted net income available to common stockholders was $29.7 million, or adjusted earnings per diluted share of $1.78, for the fourth quarter of 2019. This compares to adjusted net income available to common stockholders of $30.3 million, or adjusted earnings per diluted share of $1.70, for the fourth quarter of 2018. The decrease in adjusted net income was primarily due to lower gross profit and a slightly higher income tax rate. These items were partially offset by a decline in general and administrative expenses. The increase in adjusted earnings per diluted share was due to lower general and administrative expenses and fewer weighted average diluted shares outstanding. (See “Non-GAAP Financial Measures” below.)

 

   

General and administrative expenses were $41.7 million for the fourth quarter of 2019 compared to $45.3 million for the fourth quarter of 2018. The improvement was mainly due to lower compensation expenses and a decline in professional services costs.


Page 4 of 16

 

Fiscal 2019 Financial Highlights

 

   

GAAP net income available to common stockholders was $100.8 million, or earnings per diluted share of $5.85, for 2019. This compares to net income available to common stockholders of $77.6 million, or earnings per diluted share of $4.37, for 2018. The increase in net income was primarily due to higher gross profit as the result of $30 million in franchisor contributions to the Applebee’s national advertising fund made in 2018 that did not recur in 2019. This was partially offset by approximately $8.3 million in debt extinguishment costs related to the refinancing of our long-term debt, which was completed on June 5, 2019.

 

   

Adjusted net income available to common stockholders was $119.7 million, or adjusted earnings per diluted share of $6.95, for 2019. This compares to adjusted net income available to common stockholders of $95.5 million, or adjusted earnings per diluted share of $5.37 for fiscal 2018. The increase in adjusted net income was primarily due to higher gross profit as the result of $30.0 million in franchisor contributions to the Applebee’s national advertising fund made in 2018 that did not recur in 2019. (See “Non-GAAP Financial Measures” below.)

 

   

General and administrative expenses were approximately $162.8 million for 2019 compared to $166.7 million for 2018. The improvement was mainly due to lower compensation expenses and a decline in professional services costs.

GAAP Effective Tax Rate

Our effective tax rates for the fourth quarter and fiscal 2019 were 25.0% and 24.6%, respectively.

Financial Performance Guidance for 2020

The following financial performance guidance for fiscal 2020 is based on management’s expectations as of February 24, 2020. The projections are as of this date, and the Company assumes no obligation to update or supplement these estimates.

 

   

Applebee’s domestic system-wide comparable same-restaurant sales performance is expected to range between 0% and positive 2.0%.

 

   

IHOP’s domestic system-wide comparable same-restaurant sales performance is expected to range between 0% and positive 2.0%.

 

   

Domestic development activity by Applebee’s franchisees is expected to result in net closures between 0 and 10 restaurants.

 

   

Domestic development activity by IHOP franchisees and area licensees are expected to result in net new openings between 40 and 50 restaurants.

 

   

Total segment profit, excluding the company restaurants segment, is expected to be between approximately $385 million and $395 million.


Page 5 of 16

 

   

General and administrative expenses are expected to range between approximately $170 million and $175 million, including non-cash stock-based compensation expense and depreciation totaling approximately $45 million. This projection includes approximately $5 million of general and administrative expenses related to the company restaurants segment.

 

   

GAAP net income is expected to range between approximately $105 million and approximately $115 million.

 

   

Consolidated adjusted EBITDA is expected to range between approximately $275 million and approximately $285 million. This projection includes company restaurants segment EBITDA, which is expected to be between approximately $9 million and approximately $11 million. (See “Non-GAAP Financial Measures” and reconciliation of GAAP net income to consolidated adjusted EBITDA.)

 

   

Capital expenditures are expected to be approximately $17 million, inclusive of approximately $4 million related to the company restaurants segment.

 

   

GAAP earnings per diluted share is expected to range from $6.40 to $6.60.

 

   

Adjusted earnings per diluted share is expected to range from $7.08 to $7.28. (See “Non-GAAP Financial Measures” and reconciliation of GAAP earnings per diluted share to adjusted earnings per diluted share.)

2020 Diluted Net Income Available to Common Stockholders Per Share(1), As Adjusted Reconciliation Guidance Table

 

Net income available to common stockholders per diluted share

   $6.40 – $6.60

Closure and impairment charges

   0.08

Amortization of intangible assets

   0.48

Non-cash interest expense

   0.12
  

 

Diluted net income available to common stockholders per share, as adjusted        $7.08 – $7.28    
  

 

(1) The after-tax adjustments to net income available to common stockholders per diluted share are midpoint estimates.

2020 Net Income to Consolidated Adjusted EBITDA Reconciliation Guidance Table(1)

($ in millions)

 

Net income

   $105 – $115

Interest charges on finance leases

   8

All other interest charges

   65

Income tax provision

   39

Depreciation and amortization

   43

Non-cash stock-based compensation

   13

Impairment and closure charges

   2
  

 

Consolidated adjusted EBITDA (Non-GAAP)

           $275 – $285        
  

 

(1) The adjustments to net income are midpoint estimates.


Page 6 of 16

 

Fourth Quarter and Fiscal 2019 Conference Call Details

Dine Brands will host a conference call to discuss its results on February 24, 2020 at 9:00 a.m. Pacific Time/12:00 p.m. Eastern Time. To participate on the call, please dial (888) 771-4371 and reference passcode 49342172. International callers, please dial (847) 585-4405 and reference passcode 49342172.

A live webcast of the call will be available on www.dinebrands.com and may be accessed by visiting Events and Presentations under the site’s Investors section. Participants should allow approximately ten minutes prior to the call’s start time to visit the site and download any streaming media software needed to listen to the webcast. A telephonic replay of the call may be accessed from 11:30 a.m. Pacific Time on February 24, 2020 through 8:59 p.m. Pacific Time on March 2, 2020 by dialing (888) 843-7419 and referencing passcode 49342172#. International callers, please dial (630) 652-3042 and reference passcode 49342172#. An online archive of the webcast will also be available on Events and Presentations under the Investors section of the Company’s website.

About Dine Brands Global, Inc.

Based in Glendale, California, Dine Brands Global, Inc. (NYSE: DIN), through its subsidiaries, franchises restaurants under both the Applebee’s Neighborhood Grill + Bar and IHOP brands. With over 3,600 restaurants combined in 17 countries and approximately 370 franchisees, Dine Brands is one of the largest full-service restaurant companies in the world. For more information on Dine Brands, visit the Company’s website located at www.dinebrands.com.

Forward-Looking Statements

Statements contained in this press release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can identify these forward-looking statements by words such as “may,” “will,” “would,” “should,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan,” “goal” and other similar expressions. These statements involve known and unknown risks, uncertainties and other factors, which may cause actual results to be materially different from those expressed or implied in such statements. These factors include, but are not limited to: general economic conditions; our level of indebtedness; compliance with the terms of our securitized debt; our ability to refinance our current indebtedness or obtain additional financing; our dependence on information technology; potential cyber incidents; the implementation of restaurant development plans; our dependence on our franchisees; the concentration of our Applebee’s franchised restaurants in a limited number of franchisees; the financial health of our franchisees; our franchisees’ and other licensees’ compliance with our quality standards and trademark usage; general risks associated with the restaurant industry; potential harm to our brands’ reputation; possible future impairment charges; the effects of tax reform; trading volatility and fluctuations in the price of our stock; our ability to achieve the financial guidance we provide to investors; successful implementation of our business strategy; the availability of suitable locations for new restaurants; shortages or interruptions in the supply or delivery of products from third parties or availability of utilities; the management and forecasting of appropriate inventory levels; development and implementation of innovative marketing and use of social media; changing health or dietary preference of consumers; risks associated with doing business in international markets; the results of litigation and other legal proceedings; third-party claims with respect to intellectual property assets; our ability to attract and retain management and other key employees; compliance with federal, state and local governmental regulations; risks associated with our self-insurance; natural disasters or other serious incidents; our success with development initiatives outside of our core business; the adequacy of our internal controls over financial reporting and future changes in accounting standards; and other factors discussed from time to time in the Company’s Annual and Quarterly Reports on Forms 10-K and 10-Q and in the Company’s other filings with the Securities and Exchange Commission. The forward-looking statements contained in this release are made as of the date hereof and the Company does not intend to, nor does it assume any obligation to, update or supplement any forward-looking statements after the date hereof to reflect actual results or future events or circumstances.


Page 7 of 16

 

Non-GAAP Financial Measures

This press release includes references to the Company’s non-GAAP financial measure “adjusted net income available to common stockholders”, “adjusted earnings per diluted share (Adjusted EPS)”, “Adjusted EBITDA” and “Adjusted free cash flow.” Adjusted EPS is computed for a given period by deducting from net income or loss available to common stockholders for such period the effect of any closure and impairment charges, any gain or loss related to debt extinguishment, any intangible asset amortization, any non-cash interest expense, any gain or loss related to the disposition of assets, and other items deemed not reflective of current operations. This is presented on an aggregate basis and a per share (diluted) basis. Adjusted EBITDA is computed for a given period by deducting from net income or loss for such period the effect of any closure and impairment charges, any interest charges, any income tax provision or benefit, any non-cash stock-based compensation, any depreciation and amortization, any gain or loss related to the disposition of assets and other items deemed not reflective of current operations. “Adjusted free cash flow” for a given period is defined as cash provided by operating activities, plus receipts from notes and equipment contracts receivable, less capital expenditures. Management may use certain of these non-GAAP financial measures along with the corresponding U.S. GAAP measures to evaluate the performance of the business and to make certain business decisions. Management uses adjusted free cash flow in its periodic assessments of, among other things, the amount of cash dividends per share of common stock and repurchases of common stock and we believe it is important for investors to have the same measure used by management for that purpose. Adjusted free cash flow does not represent residual cash flow available for discretionary purposes. Additionally, adjusted EPS is one of the metrics used in determining payouts under the Company’s annual cash incentive plan. Management believes that these non-GAAP financial measures provide additional meaningful information that should be considered when assessing the business and the Company’s performance compared to prior periods and the marketplace. Adjusted EPS and adjusted free cash flow are supplemental non-GAAP financial measures and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with U.S. GAAP.


Page 8 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

(In thousands, except per share amounts)

 

     Three Months Ended    Twelve Months Ended
     December 31,    December 31,
     2019   2018    2019   2018
     (Unaudited)         

Revenues:

         

Franchise revenues:

         

Royalties, franchise fees and other

   $ 92,259     $ 99,865      $ 368,171     $ 375,640  

Advertising revenue

     71,133       74,737        283,015       268,294  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Total franchise revenues

     163,392       174,602        651,186       643,934  

Company restaurant sales

     31,180       7,084        131,214       7,084  

Rental revenues

     31,107       30,642        120,666       121,934  

Financing revenues

     1,832       1,870        7,112       7,979  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Total revenues

     227,511       214,198        910,178       780,931  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Cost of revenues:

         

Franchise expenses:

         

Advertising expenses

     69,899       76,033        281,781       269,590  

Other franchise expenses

     9,068       11,429        30,973       61,029  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Total franchise expenses

     78,967       87,462        312,754       330,619  

Company restaurant expenses

     30,141       5,872        123,272       5,872  

Rental expenses:

         

Interest expense from finance leases

     1,277       1,579        5,602       6,894  

Other rental expenses

     21,316       20,766        85,157       83,862  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Total rental expenses

     22,593       22,345        90,759       90,756  

Financing expenses

     142       148        579       597  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Total cost of revenues

             131,843               115,827                527,364               427,844  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Gross profit

     95,668       98,371        382,814       353,087  

General and administrative expenses

     41,710       45,260        162,815       166,683  

Interest expense, net

     15,160       15,576        60,393       61,686  

Amortization of intangible assets

     2,928       2,592        11,702       10,105  

Closure and impairment charges

     847       1,988        1,487       2,107  

Loss on extinguishment of debt

                  8,276        

Debt refinancing costs

           (9            2,523  

(Gain) loss on disposition of assets

     (1,519     910        (332     (625
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Income before income tax provision

     36,542       32,054        138,473       110,608  

Income tax provision

     (9,146     (5,073      (34,127     (30,254
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Net income

   $ 27,396     $ 26,981      $ 104,346     $ 80,354  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Net income available to common stockholders:

         

Net income

   $ 27,396     $ 26,981      $ 104,346     $ 80,354  

Less: Net income allocated to unvested participating restricted stock

     (908     (917      (3,532     (2,711
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Net income available to common stockholders

   $ 26,488     $ 26,064      $ 100,814     $ 77,643  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Net income available to common stockholders per share:

         

Basic

   $ 1.61     $ 1.49      $ 5.95     $ 4.43  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Diluted

   $ 1.59     $ 1.47      $ 5.85     $ 4.37  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Weighted average shares outstanding:

         

Basic

     16,449       17,446        16,934       17,533  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Diluted

     16,698       17,785        17,245       17,789  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Dividends declared per common share

     $0.69       $0.63        $2.76       $2.52  
  

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Dividends paid per common share

     $0.69       $0.63        $2.70       $2.86  
  

 

 

 

 

 

 

 

  

 

 

 


Page 9 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Consolidated Balance Sheets

(In thousands, except share and per share amounts

 

     December 31, 2019   December 31, 2018
Assets     

Current assets:

    

Cash and cash equivalents

   $ 116,043     $ 137,164  

Receivables, net

     136,869       137,504  

Restricted cash

     40,732       48,515  

Prepaid gift card costs

     36,077       38,195  

Prepaid income taxes

     13,290       17,402  

Other current assets

     3,906       3,410  
  

 

 

 

 

 

 

 

Total current assets

     346,917       382,190  

Other intangible assets, net

     575,103       585,889  

Operating lease right-of-use asset

     366,931        

Goodwill

     343,862       345,314  

Property and equipment, net

     216,420       240,264  

Long-term receivables, net

     85,999       103,102  

Deferred rent receivable

     70,308       77,069  

Non-current restricted cash

     15,700       14,700  

Other non-current assets, net

     28,271       26,152  
  

 

 

 

 

 

 

 

Total assets

   $ 2,049,511     $ 1,774,680  
  

 

 

 

 

 

 

 

Liabilities and Stockholders’ Deficit

    

Current liabilities:

    

Current maturities of long-term debt

   $     $ 25,000  

Accounts payable

     40,925       43,468  

Gift card liability

     159,019       160,438  

Current maturities of operating lease obligations

     72,815        

Current maturities of finance lease and financing obligations

     13,669       14,031  

Accrued employee compensation and benefits

     23,904       27,479  

Dividends payable

     11,702       11,389  

Deferred franchise revenue, short-term

     10,086       10,138  

Other accrued expenses

     25,792       24,243  
  

 

 

 

 

 

 

 

Total current liabilities

     357,912       316,186  

Long-term debt, less current maturities

     1,288,248       1,274,087  

Operating lease obligations, less current maturities

     359,025        

Finance lease obligations, less current maturities

     77,393       87,762  

Financing obligations, less current maturities

     37,682       38,482  

Deferred income taxes, net

     98,499       105,816  

Deferred franchise revenue, long-term

     56,944       64,557  

Other non-current liabilities

     15,582       90,063  
  

 

 

 

 

 

 

 

Total liabilities

     2,291,285       1,976,953  
  

 

 

 

 

 

 

 

Commitments and contingencies

    

Stockholders’ deficit:

    

Preferred stock, $1 par value, 10,000,000 shares authorized, no shares issued and outstanding

            

Common stock, $0.01 par value; shares: 40,000,000 authorized; December 31, 2019 - 24,925,447 issued, 16,521,921 outstanding; December 31, 2018 - 24,984,898 issued, 17,644,267 outstanding

     249       250  

Additional paid-in-capital

                     246,192                       237,726  

Retained earnings

     61,653       10,414  

Accumulated other comprehensive loss

     (58     (60

Treasury stock, at cost; shares: December 31, 2019 - 8,403,526; December 31, 2018 - 7,340,631

     (549,810     (450,603
  

 

 

 

 

 

 

 

Total stockholders’ deficit

     (241,774     (202,273
  

 

 

 

 

 

 

 

Total liabilities and stockholders’ deficit

   $ 2,049,511     $ 1,774,680  
  

 

 

 

 

 

 

 


Page 10 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In thousands)

 

     Twelve Months Ended
     December 31,
     2019   2018

Cash flows from operating activities:

    

Net income

   $ 104,346     $ 80,354  

Adjustments to reconcile net income to cash flows provided by operating activities:

    

Depreciation and amortization

                 42,493                   32,175  

Non-cash stock-based compensation expense

     10,808       10,546  

Non-cash interest expense

     3,369       3,792  

Loss on extinguishment of debt

     8,276        

Closure and impairment charges

     1,485       2,038  

Deferred income taxes

     (5,494     (11,847

Deferred revenue

     (7,695     (5,577

Gain on disposition of assets

     (332     (623

Other

     (5,374     (949

Changes in operating assets and liabilities:

    

Accounts receivable, net

     (396     3,149  

Current income tax receivables and payables

     8,677       8,119  

Gift card receivables and payables

     (1,037     (1,488

Other current assets

     (498     10,425  

Accounts payable

     583       (9,940

Accrued employee compensation and benefits

     (3,575     13,183  

Other current liabilities

     (456     6,989  
  

 

 

 

 

 

 

 

Cash flows provided by operating activities

     155,180       140,346  
  

 

 

 

 

 

 

 

Cash flows from investing activities:

    

Principal receipts from notes, equipment contracts and other long-term receivables

     24,075       25,771  

Proceeds from sale of property and equipment

     2,540       655  

Acquisition of business

           (20,155

Additions to property and equipment

     (19,424     (14,279

Additions to long-term receivables

     (6,955     (6,500

Other

     (389     (293
  

 

 

 

 

 

 

 

Cash flows used in investing activities

     (153     (14,801
  

 

 

 

 

 

 

 

Cash flows from financing activities:

    

Proceeds from issuance of long-term debt

     1,300,000        

Repayment of long-term debt

     (1,283,750     (13,000

Borrowing from revolving credit facilities

           75,000  

Repayment of revolving credit facilities

     (25,000     (50,000

Dividends paid on common stock

     (46,859     (51,125

Repurchase of common stock

     (109,698     (33,603

Principal payments on finance lease obligations

     (13,639     (13,907

Payment of debt issuance costs

     (13,150     (3,633

Proceeds from stock options exercised

     11,969       3,928  

Tax payments for restricted stock upon vesting

     (2,728     (1,972

Other

     (76      
  

 

 

 

 

 

 

 

Cash flows used in financing activities

     (182,931     (88,312
  

 

 

 

 

 

 

 

Net change in cash, cash equivalents and restricted cash

     (27,904     37,233  

Cash, cash equivalents and restricted cash at beginning of period

     200,379       163,146  
  

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash at end of period

   $ 172,475     $ 200,379  
  

 

 

 

 

 

 

 


Page 11 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Non-GAAP Financial Measures

(In thousands, except per share amounts)

(Unaudited)

Reconciliation of net income available to common stockholders to net income available to common stockholders, as adjusted for the following items: Amortization of intangible assets; loss on extinguishment of debt; non-cash interest expense; administrative reorganization costs; closure and impairment charges; debt refinancing costs; business acquisition costs; nonrecurring restaurant costs; gain or loss on disposition of assets; the combined tax effect of the preceding adjustments, and income tax adjustments considered unrelated to the respective current period operations, as well as related per share data:

 

     Three Months Ended   Twelve Months Ended
     December 31,   December 31,
     2019   2018   2019   2018

Net income available to common stockholders, as reported

   $ 26,488     $ 26,064     $ 100,814     $ 77,643  

Amortization of intangible assets

     2,928       2,592       11,702       10,105  

Loss on extinguishment of debt

                 8,276        

Non-cash interest expense

     647       1,103       3,369       3,792  

Administrative reorganization costs

     1,606             1,606        

Closure and impairment charges

     847       1,988       1,487       2,107  

Debt refinancing costs

           (9           2,523  

Business acquisition costs

           1,114             1,114  

Nonrecurring restaurant costs

     2             385        

(Gain) loss on disposition of assets

     (1,519     910       (332     (625

Net income tax provision for above adjustments

     (1,173     (2,001     (6,888     (4,944

Income tax adjustments(1)

           (1,310           4,434  

Net income allocated to unvested participating restricted stock

     (108     (154     (673     (631
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common stockholders, as adjusted

   $ 29,718     $ 30,297     $ 119,746     $ 95,518  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income available to common stockholders per share:

        

Net income available to common stockholders, as reported

   $ 1.59     $ 1.47     $ 5.85     $ 4.37  

Amortization of intangible assets

     0.13       0.11       0.50       0.42  

Loss on extinguishment of debt

                 0.36        

Non-cash interest expense

     0.03       0.05       0.14       0.16  

Administrative reorganization costs

     0.07             0.07        

Closure and impairment charges

     0.04       0.08       0.06       0.09  

Debt refinancing costs

     0.00       (0.00           0.10  

Business acquisition costs

           0.05             0.05  

Nonrecurring restaurant costs

     0.00             0.02        

(Gain) loss on disposition of assets

     (0.07     0.04       (0.01     (0.03

Income tax adjustments(1)

           (0.07           0.25  

Net income allocated to unvested participating restricted stock

     (0.01     (0.01     (0.04     (0.04

Rounding

           (0.02            
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income available to common stockholders per share, as adjusted

   $ 1.78     $ 1.70     $ 6.95     $ 5.37  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator for basic EPS-income available to common stockholders, as adjusted

   $         29,718     $         30,297     $         119,746     $         95,518  

Effect of unvested participating restricted stock using the two-class method

     8       12       44       25  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator for diluted EPS-income available to common stockholders, as adjusted

   $ 29,726     $ 30,309     $ 119,790     $ 95,543  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Denominator for basic EPS-weighted-average shares

     16,449       17,446       16,934       17,533  

Dilutive effect of stock options

     249       339       311       256  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Denominator for diluted EPS-weighted-average shares

     16,698       17,785       17,245       17,789  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Charges related to adjustments resulting from IRS audits for tax years 2011 through 2013


Page 12 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Non-GAAP Financial Measures

(Unaudited)

Reconciliation of the Company’s cash provided by operating activities to “adjusted free cash flow” (cash provided by operating activities, plus receipts from notes and equipment contracts receivable, less additions to property and equipment). Management uses this liquidity measure in its periodic assessments of, among other things, the amount of cash dividends per share of common stock and repurchases of common stock. We believe it is important for investors to have the same measure used by management for that purpose. Adjusted free cash flow does not represent residual cash flow available for discretionary purposes.

 

     Twelve Months Ended
     December 31,
     2019   2018
     (In millions)

Cash flows provided by operating activities

   $             155.2     $             140.3  

Receipts from notes and equipment contracts receivable

     13.0       14.9  

Additions to property and equipment

     (19.4     (14.3
  

 

 

 

 

 

 

 

Adjusted free cash flow

     148.8       140.9  

Dividends paid on common stock

     (46.9     (51.1

Repurchase of Dine Brands Global common stock

     (109.7     (33.6
  

 

 

 

 

 

 

 

   $ (7.8   $ 56.2  
  

 

 

 

 

 

 

 


Page 13 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Non-GAAP Financial Measures

(in thousands)

(Unaudited)

Reconciliation of the Company’s net income to “adjusted EBITDA.” The Company defines adjusted EBITDA as net income, adjusted for the effect of interest charges, income tax provision or benefit, depreciation and amortization, non-cash stock-based compensation, closure and impairment charges, debt refinancing costs, gain or loss related to the extinguishment of debt and disposition of assets, other non-income based taxes and other items deemed not reflective of current operations. Management may use certain non-GAAP measures along with the corresponding U. S. GAAP measures to evaluate the performance of the company and to make certain business decisions.

 

     Three Months Ended      Twelve Months Ended  
     December 31,      December 31,  
     2019      2018      2019      2018  

Net income, as reported

   $ 27,396       $ 26,981       $ 104,346       $ 80,354   

Interest charges on finance leases

     1,788         1,724         7,707         7,040   

All other interest charges

           16,192               16,205               64,072               64,497   

Income tax provision

     9,146         5,073         34,127         30,254   

Depreciation and amortization

     10,978         8,445         42,493         32,175   

Non-cash stock-based compensation

     2,588         2,530         10,808         10,546   

Closure and impairment charges

     847         1,988         1,487         2,107   

Debt refinancing costs

     —         —         —         2,523   

Loss on extinguishment of debt

     —         —         8,276         —   

(Gain) loss on disposition of assets

     (1,519)        910         (332)        (625)  

Business acquisition costs

     —         1,114         —         1,114   

Other taxes

     65         57         562         605   
  

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted EBITDA

   $ 67,481       $ 65,027       $ 273,546       $ 230,590   
  

 

 

    

 

 

    

 

 

    

 

 

 


Page 14 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Restaurant Data

(Unaudited)

The following table sets forth, for the three and twelve months ended December 31, 2019 and 2018, the number of “Effective Restaurants” in the Applebee’s and IHOP systems and information regarding the percentage change in sales at those restaurants compared to the same periods in the prior year and, as such, the percentage change in sales at Effective Restaurants is based on non-GAAP sales data. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. However, we believe that presentation of this information is useful in analyzing our revenues because franchisees and area licensees pay us royalties and advertising fees that are generally based on a percentage of their sales, and, where applicable, rental payments under leases that partially may be based on a percentage of their sales. Management also uses this information to make decisions about future plans for the development of additional restaurants as well as evaluation of current operations.

 

     Three Months Ended   Twelve Months Ended
     December 31,   December 31,
     2019   2018   2019   2018

Applebee’s

        
Effective Restaurants(a)                 

Franchise

             1,725               1,835               1,745               1,883  

Company

     69       11       69       3  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

     1,794       1,846       1,814       1,886  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

System-wide(b)

        

Domestic sales percentage change(c)

     (3.8 )%      0.3  %      (3.0 )%      2.3  % 

Domestic same-restaurant sales percentage change(d)

     (2.5 )%      3.5  %      (0.7 )%      5.0  % 

Franchise(b)

        

Domestic sales percentage change(c) (e)

     (6.2 )%      (0.4 )%      (5.9 )%      2.1  % 

Domestic same-restaurant sales percentage change(d)

     (2.5 )%      3.4  %      (0.7 )%      4.9  % 

Average weekly domestic unit sales (in thousands)

   $ 46.1     $ 46.5     $ 47.3     $ 46.7  
IHOP                 
Effective Restaurants(a)                 

Franchise

     1,670       1,649       1,663       1,633  

Area license

     159       159       157       162  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

     1,829       1,808       1,820       1,795  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

System-wide(b)

        

Sales percentage change(c)

     2.1  %      4.5  %      2.2  %      3.9  % 

Domestic same-restaurant sales percentage change(d) (f)

     1.1  %      3.0  %      1.1  %      1.5  % 

Franchise(b)

        

Sales percentage change(c)

     2.0  %      5.2  %      2.2  %      4.4  % 

Domestic same-restaurant sales percentage change(d)

     1.1  %      3.0  %      1.0  %      1.5  % 

Average weekly unit sales (in thousands)

   $ 37.3     $ 37.0     $ 36.7     $ 36.6  

Area License (b)

        

Sales percentage change(c)

     3.7  %      (3.1 )%      2.7  %      0.5  % 


Page 15 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Restaurant Data

 

(a)

“Effective Restaurants” are the weighted average number of restaurants open in a given fiscal period, adjusted to account for restaurants open for only a portion of the period. Information is presented for all Effective Restaurants in the Applebee’s and IHOP systems, which includes restaurants owned by franchisees and area licensees as well as those owned by the Company.

 

(b)

“System-wide” sales are retail sales at domestic Applebee’s restaurants operated by franchisees and IHOP restaurants operated by franchisees and area licensees, as reported to the Company, in addition to retail sales at company-operated restaurants. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. An increase or decrease in franchisees’ reported sales will result in a corresponding increase or decrease in our royalty revenue. Unaudited reported sales for Applebee’s domestic franchise restaurants, IHOP franchise restaurants and IHOP area license restaurants for the three and twelve months ended December 31, 2019 and 2018 and sales by company-operated restaurants were as follows:

 

     Three Months Ended      Twelve Months Ended  
     December 31,      December 31,  
     2019      2018      2019      2018  
     (In millions)  

 Reported sales

           

Applebee’s domestic franchise restaurant sales

   $         957.1       $         1,020.6       $         3,954.3       $         4,204.1   

Applebee’s company-operated restaurants

     31.2         7.1         131.2         7.1   

IHOP franchise restaurant sales

     809.9         793.9         3,174.2         3,106.7   

IHOP area license restaurant sales

     72.3         69.8         289.5         282.0   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total

   $ 1,870.5       $ 1,891.4       $ 7,549.2       $ 7,599.9   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

(c)

“Sales percentage change” reflects, for each category of restaurants, the percentage change in sales in any given fiscal period compared to the prior fiscal period for all restaurants in that category.

 

(d)

“Domestic same-restaurant sales percentage change” reflects the percentage change in sales, in any given fiscal period, compared to the same weeks in the prior year for domestic restaurants that have been operated throughout both fiscal periods that are being compared and have been open for at least 18 months. Because of new unit openings and restaurant closures, the domestic restaurants open throughout both fiscal periods being compared may be different from period to period.

 

(e)

The franchise sales percentage change for 2019 was impacted by the acquisition of 69 franchise restaurants in December 2018 now reported as company-operated.

 

(f)

IHOP same-restaurant sales data includes area license restaurants beginning in 2019.


Page 16 of 16

 

Dine Brands Global, Inc. and Subsidiaries

Restaurant Data

(Unaudited)

The following table summarizes our restaurant development activity:

 

     Three Months Ended   Twelve Months Ended
     December 31,   December 31,
     2019   2018   2019   2018

Applebee’s Restaurant Development Activity

        
Summary - beginning of period:                 

Franchise

                 1,735                   1,856                   1,768                   1,936  

Company restaurants

     69             69        
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Applebee’s restaurants, beginning of period

     1,804       1,856       1,837       1,936  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franchise restaurants opened:

        

Domestic

     1             1       2  

International

     1       2       2       5  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total franchise restaurants opened

     2       2       3       7  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franchise restaurants closed:

        

Domestic

     (3     (14     (29     (91

International

     (16     (7     (24     (15
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total franchise restaurants closed

     (19     (21     (53     (106
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net franchise restaurant reduction

     (17     (19     (50     (99

Franchise restaurants acquired by the Company

           (69           (69
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net franchise restaurant decrease

     (17     (88     (50     (168
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary - end of period:

        

Franchise

     1,718       1,768       1,718       1,768  

Company

     69       69       69       69  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Applebee’s restaurants, end of period

     1,787       1,837       1,787       1,837  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic

     1,665       1,693       1,665       1,693  

International

     122       144       122       144  
IHOP Restaurant Development Activity                 
Summary - beginning of period:                 

Franchise

     1,675       1,652       1,669       1,622  

Area license

     161       162       162       164  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total IHOP restaurants, beginning of period

     1,836       1,814       1,831       1,786  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franchise/area license restaurants opened:

        

Domestic franchise

     10       19       33       51  

Domestic area license

                 5       3  

International franchise

     4       3       13       17  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total franchise/area license restaurants opened

     14       22       51       71  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franchise/area license restaurants closed:

        

Domestic franchise

     (8     (5     (27     (15

Domestic area license

                 (6     (5

International franchise

     (1           (8     (6
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total franchise/area license restaurants closed

     (9     (5     (41     (26
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net franchise/area license restaurant development

     5       17       10       45  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Refranchised from Company restaurants

                       1  

Franchise restaurants reacquired by the Company

                       (1
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net franchise/area license restaurant additions

     5       17       10       45  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary - end of period

        

Franchise

     1,680       1,669       1,680       1,669  

Area license

     161       162       161       162  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total IHOP restaurants, end of period

     1,841       1,831       1,841       1,831  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic

     1,710       1,705       1,710       1,705  

International

     131       126       131       126  
EX-99.2

Exhibit 99.2

 

LOGO     

 

 

    News Release

Investor Contact

Ken Diptee

Executive Director, Investor Relations

Dine Brands Global, Inc.

818-637-3632

Media Contact

Susan Nelson

Vice President, Global Communications

and Public Affairs

Dine Brands Global, Inc.

818-637-4726

Dine Brands Global, Inc. Announces First Quarter 2020 Dividend

Quarterly Dividend Increased by 10%

GLENDALE, Calif., February 24, 2020 – Dine Brands Global, Inc. (NYSE: DIN), the parent company of Applebee’s Neighborhood Grill + Bar® and IHOP® restaurants, today announced that its Board of Directors declared and approved a 10% increase in the quarterly cash dividend to $0.76 per share of common stock. The dividend will be payable on April 3, 2020 to the Company’s stockholders of record at the close of business on March 20, 2020.

About Dine Brands Global, Inc.

Based in Glendale, California, Dine Brands Global, Inc. (NYSE: DIN), through its subsidiaries, franchises restaurants under both the Applebee’s Neighborhood Grill + Bar and IHOP brands. With over 3,600 restaurants combined in 17 countries and approximately 370 franchisees, Dine Brands is one of the largest full-service restaurant companies in the world. For more information on Dine Brands, visit the Company’s website located at www.dinebrands.com.


Page 2 of 2

 

Forward-Looking Statements

Statements contained in this press release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can identify these forward-looking statements by words such as “may,” “will,” “would,” “should,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan,” “goal” and other similar expressions. These statements involve known and unknown risks, uncertainties and other factors, which may cause actual results to be materially different from those expressed or implied in such statements. These factors include, but are not limited to: general economic conditions; our level of indebtedness; compliance with the terms of our securitized debt; our ability to refinance our current indebtedness or obtain additional financing; our dependence on information technology; potential cyber incidents; the implementation of restaurant development plans; our dependence on our franchisees; the concentration of our Applebee’s franchised restaurants in a limited number of franchisees; the financial health of our franchisees; our franchisees’ and other licensees’ compliance with our quality standards and trademark usage; general risks associated with the restaurant industry; potential harm to our brands’ reputation; possible future impairment charges; the effects of tax reform; trading volatility and fluctuations in the price of our stock; our ability to achieve the financial guidance we provide to investors; successful implementation of our business strategy; the availability of suitable locations for new restaurants; shortages or interruptions in the supply or delivery of products from third parties or availability of utilities; the management and forecasting of appropriate inventory levels; development and implementation of innovative marketing and use of social media; changing health or dietary preference of consumers; risks associated with doing business in international markets; the results of litigation and other legal proceedings; third-party claims with respect to intellectual property assets; our ability to attract and retain management and other key employees; compliance with federal, state and local governmental regulations; risks associated with our self-insurance; natural disasters or other serious incidents; our success with development initiatives outside of our core business; the adequacy of our internal controls over financial reporting and future changes in accounting standards; and other factors discussed from time to time in the Company’s Annual and Quarterly Reports on Forms 10-K and 10-Q and in the Company’s other filings with the Securities and Exchange Commission. The forward-looking statements contained in this release are made as of the date hereof and the Company does not intend to, nor does it assume any obligation to, update or supplement any forward-looking statements after the date hereof to reflect actual results or future events or circumstances.