SEC Filing | Dine Brands

- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM 10-Q (MARK ONE) /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER 0-8360 ------------------------ IHOP CORP. (Exact name of registrant as specified in its charter) DELAWARE 95-3038279 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 525 NORTH BRAND BOULEVARD, 91203-1903 GLENDALE, CALIFORNIA (Zip Code) (Address of principal executive offices) (818) 240-6055 (Registrant's telephone number, including area code) ------------------------ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes /X/ No / / Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. CLASS OUTSTANDING AS OF MARCH 31, 2000 ----- -------------------------------- Common Stock, $.01 par value 19,907,314 - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------

PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS IHOP CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE AMOUNTS) MARCH 31, DECEMBER 31, 2000 1999 ----------- ------------ (UNAUDITED) ASSETS Current assets Cash and cash equivalents................................. $ 1,867 $ 4,176 Receivables............................................... 30,913 35,335 Reacquired franchises and equipment held for sale, net.... 2,879 2,842 Inventories............................................... 818 1,223 Prepaid expenses.......................................... 4,283 4,309 -------- -------- Total current assets.................................... 40,760 47,885 -------- -------- Long-term receivables....................................... 273,375 265,983 Property and equipment, net................................. 185,425 177,743 Reacquired franchises and equipment held for sale, net...... 16,316 16,102 Excess of costs over net assets acquired, net............... 11,518 11,625 Other assets................................................ 1,046 1,064 -------- -------- Total assets............................................ $528,440 $520,402 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Current maturities of long-term debt...................... $ 8,956 $ 8,956 Accounts payable.......................................... 12,618 18,016 Accrued employee compensation and benefits................ 6,668 7,804 Other accrued expenses.................................... 8,672 5,896 Deferred income taxes..................................... 2,031 3,833 Capital lease obligations................................. 1,761 1,682 -------- -------- Total current liabilities............................... 40,706 46,187 -------- -------- Long-term debt.............................................. 41,077 41,218 Deferred income taxes....................................... 42,822 39,768 Capital lease obligations and other......................... 172,827 166,749 Shareholders' equity Preferred stock, $1 par value, 10,000,000 shares authorized; none issued................................. -- -- Common stock, $.01 par value, 40,000,000 shares authorized; shares issued and outstanding: March 31, 2000, 19,907,314 shares; December 31, 1999, 20,117,314 shares.................................................. 201 201 Additional paid-in capital................................ 66,504 66,485 Retained earnings......................................... 165,523 158,294 Treasury stock, at cost (210,000 and no shares for March 31, 2000 and December 31, 1999, respectively)..... (3,063) -- Contribution to ESOP...................................... 1,843 1,500 -------- -------- Total shareholders' equity.............................. 231,008 226,480 -------- -------- Total liabilities and shareholders' equity.............. $528,440 $520,402 ======== ======== See the accompanying notes to the consolidated financial statements. 2

IHOP CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) THREE MONTHS ENDED MARCH 31 ------------------- 2000 1999 -------- -------- Revenues Franchise operations Rent...................................................... $11,721 $11,052 Service fees and other.................................... 32,936 28,552 ------- ------- 44,657 39,604 Sale of franchises and equipment............................ 5,977 5,711 Company operations.......................................... 17,772 16,007 ------- ------- Total revenues.......................................... 68,406 61,322 ------- ------- Costs and Expenses Franchise operations Rent...................................................... 6,291 5,672 Other direct costs........................................ 11,421 10,420 ------- ------- 17,712 16,092 Cost of sales of franchises and equipment................... 4,282 3,745 Company operations.......................................... 16,920 15,183 Field, corporate and administrative......................... 8,263 8,307 Depreciation and amortization............................... 3,314 3,016 Interest.................................................... 5,600 4,457 Other expense and (income), net............................. 560 (185) ------- ------- Total costs and expenses................................ 56,651 50,615 ------- ------- Income before income taxes.................................. 11,755 10,707 Provision for income taxes.................................. 4,526 4,122 ------- ------- Net income.............................................. $ 7,229 $ 6,585 ======= ======= Net Income Per Share Basic..................................................... $ .36 $ .33 ======= ======= Diluted................................................... $ .36 $ .33 ======= ======= Weighted Average Shares Outstanding Basic..................................................... 20,076 19,817 ======= ======= Diluted................................................... 20,255 20,209 ======= ======= See the accompanying notes to the consolidated financial statements. 3

IHOP CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS) (UNAUDITED) THREE MONTHS ENDED MARCH 31, ------------------- 2000 1999 -------- -------- Cash flows from operating activities Net income................................................ $ 7,229 $ 6,585 Adjustments to reconcile net income to cash provided by operating activities Depreciation and amortization............................. 3,314 3,016 Deferred taxes............................................ 1,252 872 Contribution to ESOP...................................... 343 295 Change in current assets and liabilities Accounts receivable..................................... 4,368 (2,839) Inventories............................................. 405 37 Prepaid expenses........................................ 26 34 Accounts payable........................................ (5,398) (2,244) Accrued employee compensation and benefits.............. (1,136) (1,204) Other accrued expenses.................................. 2,776 809 Other, net................................................ 991 324 -------- -------- Cash provided by operating activities................. 14,170 5,685 -------- -------- Cash flows from investing activities Additions to property and equipment....................... (15,773) (12,475) Additions to notes and equipment contracts receivable..... (1,540) (2,123) Principal receipts from notes and equipment contracts receivable.............................................. 3,205 2,967 Additions to reacquired franchises held for sale.......... (483) (655) -------- -------- Cash used by investing activities..................... (14,591) (12,286) -------- -------- Cash flows from financing activities Proceeds from issuance of long-term debt.................. -- 2,900 Proceeds from sale and leaseback arrangements............. 1,645 4,015 Repayment of long-term debt............................... (142) (2,912) Principal payments on capital lease obligations........... (328) (230) Treasury stock transactions............................... (3,063) 153 Exercise of stock options................................. -- 381 -------- -------- Cash (used) provided by financing activities.......... (1,888) 4,307 -------- -------- Net change in cash and cash equivalents..................... (2,309) (2,294) Cash and cash equivalents at beginning of period............ 4,176 2,294 -------- -------- Cash and cash equivalents at end of period............ $ 1,867 $ -- ======== ======== Supplemental disclosures Interest paid, net of capitalized amounts................. $ 4,635 $ 3,397 Income taxes paid......................................... 51 168 Capital lease obligations incurred........................ 6,560 6,700 See the accompanying notes to the consolidated financial statements. 4

IHOP CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. GENERAL: The accompanying consolidated financial statements for the three months ended March 31, 2000, have been prepared in accordance with generally accepted accounting principles ("GAAP"). These financial statements have not been audited by independent public accountants but include all adjustments, consisting of normal, recurring accruals, which in the opinion of management of IHOP Corp. and Subsidiaries ("IHOP") are necessary for a fair presentation of the financial position and the results of operations for the periods presented. The accompanying consolidated balance sheet as of December 31, 1999, has been derived from audited financial statements, but does not include all disclosures required by GAAP. The results of operations for the three months ended March 31, 2000, are not necessarily indicative of the results to be expected for the full year ending December 31, 2000. 2. Certain reclassifications have been made to prior year information to conform to the current year presentation. 3. SEGMENTS: IHOP identifies its operating segments based on the organizational units used by management to monitor performance and make operating decisions. The Franchise Operations segment includes restaurants operated by franchisees and area licensees in the United States, Canada and Japan. The Company Operations segment includes company-operated restaurants in the United States. We measure segment profit as operating income, which is defined as income before field, corporate and administrative expense, interest expense, and income taxes. Information on segments and reconciliation to income before income taxes are as follows: SALES OF CONSOLIDATING FRANCHISE COMPANY FRANCHISES ADJUSTMENTS CONSOLIDATED OPERATIONS OPERATIONS AND EQUIPMENT AND OTHER TOTAL ---------- ---------- ------------- ------------- ------------ (IN THOUSANDS) (UNAUDITED) THREE MONTHS ENDED MARCH 31, 2000 Revenues from external customers... $ 44,657 $17,772 $ 5,977 $ -- $ 68,406 Intercompany real estate charges (revenues)....................... 1,495 171 -- (1,666) -- Depreciation and amortization...... 1,008 1,057 -- 1,249 3,314 Operating income (loss)............ 20,024 (953) 1,695 4,852 25,618 Field, corporate and administrative................... 8,263 Interest expense................... 5,600 Income before income taxes......... 11,755 Additions to long-lived assets..... 13,055 1,119 483 1,599 16,256 Total assets....................... 391,145 46,748 19,195 71,352 528,440 THREE MONTHS ENDED MARCH 31, 1999 Revenues from external customers... $ 39,604 $16,007 $ 5,711 $ -- $ 61,322 Intercompany real estate charges (revenues)....................... 1,425 111 -- (1,536) -- Depreciation and amortization...... 959 916 -- 1,141 3,016 Operating income (loss)............ 17,869 (681) 1,966 4,317 23,471 Field, corporate and administrative................... 8,307 Interest expense................... 4,457 Income before income taxes......... 10,707 Additions to long-lived assets..... 6,510 1,280 655 4,685 13,130 Total assets....................... 324,286 42,405 17,938 65,775 450,404 For management reporting purposes, we treat all restaurant lease revenues and expenses as operating lease revenues and expenses, although most of these leases are direct financing leases or capital lease obligations. The accounting adjustments required to bring lease revenues and expenses into conformance with GAAP are included in Consolidating Adjustments and Other. All of IHOP's owned land and restaurant buildings are included in total assets in Consolidating Adjustments and Other. 5

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS The following table sets forth certain operating data for IHOP restaurants: THREE MONTHS ENDED MARCH 31, ---------------------- 2000 1999 -------- -------- (IN THOUSANDS) (UNAUDITED) Restaurant Data Effective restaurants(a) Franchise............................................... 678 619 Company................................................. 77 69 Area license............................................ 148 145 -------- -------- Total................................................. 903 833 ======== ======== System-wide Sales(b).................................................. $298,822 $269,633 Percent increase........................................ 10.8% 9.0% Average sales per effective restaurant.................... $ 331 $ 324 Percent increase........................................ 2.2% 2.9% Comparable average sales per restaurant(c)................ $ 343 $ 335 Percent decrease........................................ (0.7)% (0.4)% Franchise Sales..................................................... $244,097 $219,796 Percent increase........................................ 11.1% 13.0% Average sales per effective restaurant.................... $ 360 $ 355 Percent increase........................................ 1.4% 3.5% Comparable average sales per restaurant(c)................ $ 356 $ 346 Percent decrease........................................ (0.4)% (0.5)% Company Sales..................................................... $ 17,772 $ 16,007 Percent change.......................................... 11.0% (9.5)% Average sales per effective restaurant.................... $ 231 $ 232 Percent decrease........................................ (0.4)% (2.9)% Area License Sales..................................................... $ 36,953 $ 33,830 Percent change.......................................... 9.2% (3.8)% Average sales per effective restaurant...................... $ 250 $ 233 Percent change.......................................... 7.3% (4.5)% - ------------------------ (a) "Effective restaurants" are the number of restaurants in a given fiscal period adjusted to account for restaurants open only a portion of the period. (b) "System-wide sales" are retail sales of franchisees, area licensees and company-operated restaurants as reported to IHOP. (c) "Comparable average sales" reflects sales for restaurants that are operated for the entire fiscal period in which they are being compared. The restaurants included in the calculations typically will be different from period to period. Comparable average sales do not include data on restaurants located in Florida and Japan. 6

The following table summarizes IHOP's restaurant development and franchising activity: THREE MONTHS ENDED MARCH 31, ------------------- 2000 1999 -------- -------- (UNAUDITED) RESTAURANT DEVELOPMENT ACTIVITY IHOP--beginning of period................................... 903 835 New openings IHOP--developed......................................... 7 10 Investor and conversion program......................... 1 2 Area license............................................ -- -- --- --- Total new openings.................................... 8 12 Closings Company and franchise................................... (1) (3) Area license............................................ (1) -- --- --- IHOP--end of period......................................... 909 844 === === Summary--end of period Franchise................................................. 686 626 Company................................................... 75 73 Area license.............................................. 148 145 --- --- Total IHOP.............................................. 909 844 === === RESTAURANT FRANCHISING ACTIVITY IHOP--developed............................................. 8 9 Investor and conversion program............................. 1 2 Rehabilitated and refranchised.............................. 3 -- --- --- Total restaurants franchised.............................. 12 11 Reacquired by IHOP.......................................... (3) (6) Closed...................................................... (1) (3) --- --- Net addition.............................................. 8 2 === === - ------------------------ GENERAL The following discussion and analysis provides information we believe is relevant to an assessment and understanding of IHOP's consolidated results of operations and financial condition. The discussion should be read in conjunction with the consolidated financial statements and notes thereto contained in IHOP's Annual Report on Form 10-K for the fiscal year ended December 31, 1999. Certain forward-looking statements are contained in this quarterly report. They use such words as "may," "will," "expect," "believe," "plan," or other similar terminology. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different than those expressed or implied in such statements. These factors include, but are not limited to: availability of suitable locations and terms of the sites designated for development; legislation and government regulation including the ability to obtain satisfactory regulatory approvals; conditions beyond IHOP's control such as weather or natural disasters; availability and cost of materials and labor; cost and availability of capital; competition; continuing acceptance of the International House of Pancakes brand and concept by guests and franchisees; IHOP's overall marketing, operational and financial performance; economic and political conditions; adoption of new, or changes in, accounting policies and practices; and other factors discussed 7

from time to time in our filings with the Securities and Exchange Commission. Forward-looking information is provided by us pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995 and should be evaluated in the context of these factors. In addition, we disclaim any intent or obligation to update these forward-looking statements. Our quarterly results are subject to seasonal fluctuation. The mix and number of restaurants franchised affect revenues from sales of franchises and equipment and their associated costs of sales. We franchise four types of restaurants: restaurants newly developed by IHOP, restaurants developed by franchisees, restaurants developed by area licensees and restaurants that have been previously reacquired from franchisees. Franchise rights for restaurants newly developed by IHOP normally sell for a franchise fee of $200,000 to $350,000 and have little if any associated cost of sales. Equipment for newly developed IHOP Restaurants generally sell for approximately $300,000 and have little or no profit margin. Franchise rights for restaurant developed by franchisees normally sell for a franchise fee of $50,000, have minor associated franchise cost of sales and do not include an equipment sale. Area license rights are normally granted in return for a one-time development fee that is recognized ratably as restaurants are developed in the area. Previously reacquired franchises normally sell for a franchise fee of $100,000 to $350,000, include an equipment sale, and may have substantial costs of sales associated with both the franchise and the equipment. The timing of sales of franchises is affected by the timing of new restaurant openings, the condition of reacquired franchise locations and the availability of qualified franchisees. The timing of new restaurant openings is affected by a variety of real estate construction issues including obtaining regulatory approvals and weather conditions. As a consequence of the foregoing factors, the results of operations for the three months ended March 31, 2000, are not necessarily indicative of the results to be expected for the full year ending December 31, 2000. SYSTEM-WIDE RETAIL SALES System-wide retail sales include the sales of all IHOP restaurants, as reported to IHOP by its franchisees, area licensees and company-operated restaurants. System-wide retail sales grew $29,189,000 or 10.8% in the first quarter of 2000. Growth in the number of effective restaurants and increases in average sales per effective unit caused the growth in system-wide sales. "Effective restaurants" are the number of restaurants in operation in a given fiscal period adjusted to account for restaurants in operation for only a portion of the period. Effective restaurants grew by 70 or 8.4% in the first quarter of 2000 due to new restaurant development. Newly developed restaurants generally have seating and sales above the system-wide averages. System-wide average sales per effective restaurant (exclusive of area license restaurants in Florida and Japan) grew 2.2% in the first quarter of 2000. Management continues to pursue growth in sales through new restaurant development, advertising and marketing efforts, improvements in customer service and operations, and remodeling of existing restaurants. FRANCHISE OPERATIONS Franchise operations revenues are the revenues received by IHOP from its franchisees and include rent, royalties, sales of proprietary products, advertising fees and interest. Franchise operations revenues were 65.3% of total revenues in the first quarter of 2000. Franchise operations revenues grew $5,053,000 or 12.8% in the first quarter of 2000. An increase in the number of effective franchise restaurants coupled with higher average sales per franchise restaurant caused the growth in franchise operations revenues. Effective franchise restaurants grew by 59 or 9.5% in the first quarter of 2000. Average sales per effective franchise restaurant grew 1.4% in the first quarter of 2000. Franchise operations costs and expenses include rent, advertising, the cost of sales of proprietary products and other direct costs associated with franchise operations. Franchise operations costs and expenses increased $1,620,000 or 10.1% in the first quarter of 2000. Increases in franchise operations costs were generally in line with the growth in franchise operations revenue. 8

Franchise operations margin is equal to franchise operations revenues less franchise operations costs and expenses. Franchise operations margin increased $3,433,000 to $26,945,000 in the first quarter of 2000. Franchise operations margin was 60.3% of franchise operations revenues in the first quarter of 2000 compared with 59.4% in the same period in the prior year. Increased royalty income and increased interest income associated with IHOP's financing of sales of franchises and equipment to its franchisees were primarily responsible for the improvement in franchise operations margin in 2000. SALES OF FRANCHISES AND EQUIPMENT Sales of franchises and equipment were 8.7% of total revenues in the first quarter of 2000. Sales of franchises and equipment increased $266,000 or 4.7% in the first quarter of 2000. An increase in the number of restaurants franchised was the primary cause of the increase in sales of franchises and equipment. IHOP franchised 12 restaurants in the first quarter of 2000 compared with 11 in the same period in the prior year. Cost of sales of franchises and equipment increased $537,000 or 14.3% in the first quarter of 2000. The increase was generally in line with the increase in the number of restaurants franchised, although the mix of restaurants franchised also impacted the cost of sales. Margin on sales of franchises and equipment is equal to sales of franchises and equipment less the cost of sales of franchises and equipment. Margin on sales of franchises and equipment decreased $271,000 to $1,695,000 in the first quarter of 2000. Margin on sales of franchises and equipment was 28.4% compared with 34.4% in the same period in the prior year. The change in margin was primarily due to the sale of more rehabilitated and refranchised restaurants in the first quarter of 2000 compared with the same period in the prior year. COMPANY OPERATIONS Company operations revenues are sales to customers at restaurants operated by IHOP. Company operations revenues were 26.0% of total revenues in the first quarter of 2000. Company operations revenues increased $1,765,000 or 11.0% in the first quarter of 2000. An increase in the number of effective IHOP-operated restaurants was primarily responsible for the change in revenues. Effective IHOP-operated restaurants increased by eight or 11.6% in the first quarter of 2000. Average sales per effective IHOP-operated restaurant decreased by 0.4% in the first quarter of 2000. Company operations costs and expenses include food, labor and benefits, utilities and occupancy costs. Company operations costs increased $1,737,000 or 11.4% in the first quarter of 2000. Increases in company operations costs were generally in line with the growth in company operations revenue. Company operations margin is equal to company operations revenues less company operations costs and expenses. Company operations margin increased $28,000 to $852,000 in the first quarter of 2000. Company operations margin was 4.8% of company operations revenues in the first quarter of 2000 compared with 5.1% in the same period in the prior year. OTHER COSTS AND EXPENSES Field, corporate and administrative costs and expenses decreased $44,000 or 0.5% in the first quarter of 2000 compared with the same period in the prior year. The decrease was primarily caused by lower compensation expenses in the first quarter of 2000 compared with the same period in the prior year. Field, corporate and administrative costs were 2.8% of system-wide sales in the first quarter of 2000 compared with 3.1% in the same period in the prior year. Depreciation and amortization expense increased $298,000 or 9.9% in the first quarter of 2000. The increases were caused primarily by the addition of new restaurants to the IHOP chain from our ongoing restaurant development program. 9

Interest expense increased $1,143,000 or 25.6% in the first quarter of 2000. The increases were due to interest associated with new capital leases which were partially offset by reductions in interest on our senior notes due 2002 as the principal balance is paid down. BALANCE SHEET ACCOUNTS The balance of long-term receivables at March 31, 2000, increased from December 31, 1999 primarily due to IHOP's financing activities associated with the sale of franchises and equipment and the leasing of restaurants to its franchisees. Balances of property and equipment, net and capital lease obligations at March 31, 2000, increased from December 31, 1999 primarily due to new restaurant development and IHOP's capital lease obligations associated with that development. LIQUIDITY AND CAPITAL RESOURCES We invest in our business primarily through the development of additional restaurants and, to a lesser extent, through the remodeling of older company-operated restaurants. In 2000, IHOP and its franchisees and area licensees forecast developing and opening approximately 75 to 85 restaurants. Included in that number are the development of 65 to 70 new restaurants by us and the development of 10 to 15 restaurants by our franchisees and area licensees. Capital expenditure projections for 2000, which include our portion of the above development program, are approximately $80 to $90 million. In November 2000, the fifth annual installment of $4.6 million in principal becomes due on our senior notes due 2002 and the first annual installment of $3.8 million in principal becomes due on our senior notes due 2008. We expect that funds from operations, sale and leaseback arrangements (estimated to be about $30 to $35 million) and our $20 million revolving line of credit will be sufficient to cover our operating requirements, our budgeted capital expenditures and our principal repayment on our senior notes in 2000. At March 31, 2000 $20 million was available to be borrowed under our unsecured bank revolving credit agreement. 10

PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits. Exhibits not incorporated by reference are filed herewith. The remainder of the exhibits has heretofore been filed with the Commission and is incorporated herein by reference. 3.1 Certificate of Incorporation of IHOP Corp. (Exhibit 3.1 to IHOP Corp.'s Form 10-K for the fiscal year ended December 31, 1997 (the "1997 Form 10-K"), is incorporated herein by reference). 3.2 Bylaws of IHOP Corp. (Exhibit 3.2 to IHOP Corp.'s 1997 Form 10-K is incorporated herein by reference). 10.1 Employment Agreement between IHOP Corp. and Alan Unger effective February 7, 2000. (Exhibit 10.21 to IHOP Corp.'s Form 10-K for the fiscal year ended December 31, 1999 is incorporated herein by reference). 11.0 Statement Regarding Computation of Per Share Earnings 27.0 Financial Data Schedule (b) No reports on Form 8-K were filed during the quarter ended March 31, 2000. 11

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. IHOP CORP. (Registrant) April 27, 2000 BY: /s/ RICHARD K. HERZER -------------- ---------------------------------------- (Date) CHAIRMAN OF THE BOARD, PRESIDENT AND CHIEF EXECUTIVE OFFICER (PRINCIPAL EXECUTIVE OFFICER) April 27, 2000 /s/ ALAN S. UNGER -------------- ---------------------------------------- (Date) V.P.-FINANCE, TREASURER AND CHIEF FINANCIAL OFFICER (PRINCIPAL FINANCIAL OFFICER) 12

EXHIBIT 11.0 IHOP CORP. AND SUBSIDIARIES STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) THREE MONTHS ENDED MARCH 31, ------------------- 2000 1999 -------- -------- NET INCOME PER COMMON SHARE BASIC Weighted average shares outstanding....................... 20,076 19,817 ======= ======= Net income available to common shareholders............... $ 7,229 $ 6,585 ======= ======= Net income per share--basic............................... $ 0.36 $ 0.33 ======= ======= NET INCOME PER COMMON SHARE DILUTED Weighted average shares outstanding....................... 20,076 19,817 Net effect of dilutive stock options based on the treasury stock method using the average market price................... 179 392 ------- ------- Total..................................................... 20,255 20,209 ======= ======= Net income available to common shareholders............... $ 7,229 $ 6,585 ======= ======= Net income per share--diluted............................. $ 0.36 $ 0.33 ======= =======

5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF IHOP CORP. AND SUBSIDIARIES AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS DEC-31-2000 JAN-01-2000 MAR-31-2000 1,876 0 30,913 0 818 40,760 185,425 0 528,440 40,706 213,904 0 0 199 230,809 528,440 23,749 68,406 21,202 38,914 3,314 0 5,600 11,755 4,526 7,229 0 0 0 7,229 .36 .36