S
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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74-1335253
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(State or other jurisdiction of incorporation or organization)
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(IRS Employer Identification Number)
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Title of Each Class
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Name of Each Exchange on
which registered
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Common Stock ($0.32 par value per share)
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New York Stock Exchange
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Page
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•
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future operating results;
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•
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future capital expenditures, including expected reductions in capital expenditures;
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•
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future debt, including liquidity and the sources and availability of funds related to debt;
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•
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plans for our new prototype restaurants;
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•
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plans for expansion of our business;
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•
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scheduled openings of new units;
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•
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closing existing units;
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•
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effectiveness of management’s disposal plans;
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•
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future sales of assets and the gains or losses that may be recognized as a result of any such sales; and
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•
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continued compliance with the terms of our 2016 Credit Agreement.
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•
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general business and economic conditions;
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•
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the impact of competition;
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•
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our operating initiatives, changes in promotional, couponing and advertising strategies, and the success of management’s business plans;
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•
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fluctuations in the costs of commodities, including beef, poultry, seafood, dairy, cheese, oils and produce;
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•
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ability to raise menu prices and customers acceptance of changes in menu items;
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•
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increases in utility costs, including the costs of natural gas and other energy supplies;
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•
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changes in the availability and cost of labor, including the ability to attract qualified managers and team members;
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•
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the seasonality of the business;
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•
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collectability of accounts receivable;
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•
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changes in governmental regulations, including changes in minimum wages and healthcare benefit regulation;
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•
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the effects of inflation and changes in our customers’ disposable income, spending trends and habits;
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•
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the ability to realize property values;
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•
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the availability and cost of credit;
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•
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weather conditions in the regions in which our restaurants operate;
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•
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costs relating to legal proceedings;
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•
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impact of adoption of new accounting standards;
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•
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effects of actual or threatened future terrorist attacks in the United States;
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•
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unfavorable publicity relating to operations, including publicity concerning food quality, illness or other health concerns or labor relations; and
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•
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the continued service of key management personnel.
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1.
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Consistently successful execution: Every day, with every guest, at every restaurant we operate.
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2.
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Growing our human capital: Our team members are the most critical factor in ensuring our Company’s success. Our relentless focus as a company must be inspiring and developing our team members to delight our guests.
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3.
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Raising awareness of our brand: Our restaurants provide guests in our local communities with memories of family, friends, childhood, a great date, a memorable birthday, or a significant accomplishment. The most reliable ways to grow and sustain our business is to perpetuate word of mouth and remain involved in the community. We must share our story with our guests in our restaurants. This allows new guests to learn our brand story and also reaffirms it with legacy and loyal guests. Loyal guests spread and preach the word about our brand. Our most loyal guests typically agree to be in our E-club so we can communicate with them and reward them.
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4.
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Improving restaurant appearances: We recognize the importance of remodeling our legacy restaurants to remain relevant and appealing to keep loyal guests coming back and draw new ones in, and to convert occasional guests into loyal fans who give us free word-of-mouth advertising and ultimately to increase sales and profitability.
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5.
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Effective cost management: We evaluate each area of our business to assess that we are spending and investing at appropriate levels. This includes restaurant operating costs and corporate overhead costs. Within our restaurants, we seek opportunities with our food and supplies purchasing, menu offerings, labor productivity, and contracts with restaurant service providers to maintain an appropriate restaurant level cost structure. Within our corporate overhead, we seek opportunities to leverage technology and efficient work processes to maintain a stream-lined corporate overhead.
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•
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$31.0 million
of long-term debt comprised of $26.6 million 5-year Term Loan and $4.4 million 5-year Revolver;
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•
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$66.2 million
of minimum operating and capital lease commitments; and
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•
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$1.3 million
of standby letters of credit.
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•
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delay spending on maintenance projects and other capital projects, including new restaurant development;
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•
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sell assets;
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•
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restructure or refinance our debt; or
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•
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sell equity securities.
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•
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result in a reduction of our credit rating, which would make it more difficult for us to obtain additional financing on acceptable terms;
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•
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require us to dedicate a substantial portion of our cash flows from operating activities to the repayment of our debt and the interest associated with our debt;
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•
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limit our operating flexibility due to financial and other restrictive covenants, including restrictions on capital investments, debt levels, incurring additional debt and creating liens on our properties;
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•
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place us at a competitive disadvantage compared with our competitors that have relatively less debt;
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•
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expose us to interest rate risk because certain of our borrowings are at variable rates of interest; and
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•
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make us more vulnerable to downturns in our business.
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Fiscal Quarter Ended
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High
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Low
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||
December 16, 2015
|
|
5.21
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4.26
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March 9, 2016
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5.01
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3.71
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June 1, 2016
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5.10
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4.61
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August 31, 2016
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5.10
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4.47
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December 21, 2016
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4.50
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4.03
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March 15, 2017
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4.33
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3.30
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June 7, 2017
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3.41
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2.46
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August 30, 2017
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3.12
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2.63
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(a)
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(b)
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(c)
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||||
Plan Category
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Number of
Securities
to be
Issued Upon
Exercise of
Outstanding
Options,
Warrants and
Rights
|
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Weighted-
Average
Exercise Price of
Outstanding
Options,
Warrants and
Rights
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Number of
Securities
Remaining
Available for
Future Issuance
Under Equity
Compensation
Plans Excluding
Securities
Reflected in
Column (a)
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||||
Equity compensation plans previously approved by security holders
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872,216
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$
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4.74
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1,774,104
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Equity compensation plans not previously approved by security holders
(1)
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29,627
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0
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0
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Total
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901,843
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$
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4.62
|
|
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1,774,104
|
|
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2012
|
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2013
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2014
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2015
|
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2016
|
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2017
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||||||
Luby’s, Inc.
|
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100.00
|
|
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114.90
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85.90
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73.85
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71.32
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41.84
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S&P 500 Index—Total Return
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100.00
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118.51
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148.01
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146.55
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167.69
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193.80
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S&P 500 Restaurant Index
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100.00
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119.55
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130.46
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152.63
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168.63
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202.23
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New Peer Group Index Only
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100.00
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|
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111.76
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114.22
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162.72
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161.69
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207.48
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New Peer Group Index + Luby’s, Inc.
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100.00
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111.81
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113.76
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161.23
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160.18
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204.50
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Old Peer Group
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100.00
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111.76
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114.64
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164.37
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163.74
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209.95
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Old Peer Group Index + Luby's, Inc.
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100.00
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111.81
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114.17
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162.83
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162.16
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206.88
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Fiscal Year Ended
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||||||||||||||||||
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August 30, 2017
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August 31, 2016
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August 26, 2015
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August 27, 2014
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|
August 29, 2013
|
||||||||||
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(364 days)
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(371 days)
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(364 days)
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(364 days)
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(364 days)
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||||||||||
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(In thousands, except per share data)
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||||||||||||||||||
Sales
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||||||||||
Restaurant sales
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$
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350,818
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$
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378,111
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|
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$
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370,192
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|
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$
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369,808
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|
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$
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361,291
|
|
Culinary contract services
|
|
17,943
|
|
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16,695
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16,401
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18,555
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|
16,693
|
|
|||||
Franchise revenue
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6,723
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7,250
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6,961
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|
7,027
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|
6,937
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|
|||||
Vending revenue
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547
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|
|
583
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|
531
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|
532
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|
565
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|||||
Total sales
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376,031
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402,639
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394,085
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395,922
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385,486
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|||||
Provision for asset impairments and restaurant closings
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10,567
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1,442
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|
636
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|
2,717
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|
615
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|
|||||
Income (loss) from continuing operations
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(22,796
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)
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(10,256
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)
|
|
(1,616
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)
|
|
(2,011
|
)
|
|
4,479
|
|
|||||
Loss from discontinued operations
(1)
|
|
(466
|
)
|
|
(90
|
)
|
|
(458
|
)
|
|
(1,436
|
)
|
|
(1,318
|
)
|
|||||
Net income (loss)
|
|
$
|
(23,262
|
)
|
|
$
|
(10,346
|
)
|
|
$
|
(2,074
|
)
|
|
$
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(3,447
|
)
|
|
$
|
3,161
|
|
Income (loss) per share from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
(0.77
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
0.16
|
|
Assuming dilution
|
|
$
|
(0.77
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
0.16
|
|
Loss per share from discontinued operation:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
(0.02
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.05
|
)
|
Assuming dilution
|
|
$
|
(0.02
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.05
|
)
|
Net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
(0.79
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
0.11
|
|
Assuming dilution
|
|
$
|
(0.79
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
0.11
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
29,476
|
|
|
29,226
|
|
|
28,974
|
|
|
28,812
|
|
|
28,618
|
|
|||||
Assuming dilution
|
|
29,476
|
|
|
29,226
|
|
|
28,974
|
|
|
28,812
|
|
|
28,866
|
|
|||||
Total assets
|
|
$
|
226,457
|
|
|
$
|
252,225
|
|
|
$
|
264,258
|
|
|
$
|
275,435
|
|
|
$
|
250,645
|
|
Total debt
|
|
$
|
30,985
|
|
|
$
|
37,000
|
|
|
$
|
37,500
|
|
|
$
|
42,000
|
|
|
$
|
19,200
|
|
Number of restaurants at fiscal year end
|
|
167
|
|
|
175
|
|
|
177
|
|
|
174
|
|
|
180
|
|
|||||
Number of franchised restaurants at fiscal year end
|
|
113
|
|
|
113
|
|
|
106
|
|
|
110
|
|
|
116
|
|
|||||
Number of Culinary Contract Services contracts at fiscal year end
|
|
25
|
|
|
24
|
|
|
23
|
|
|
25
|
|
|
21
|
|
|||||
Costs and Expenses
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(As a percentage of restaurant sales)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of food
|
|
28.1
|
%
|
|
28.9
|
%
|
|
28.9
|
%
|
|
28.6
|
%
|
|
27.9
|
%
|
|||||
Payroll and related costs
|
|
35.9
|
%
|
|
34.5
|
%
|
|
34.3
|
%
|
|
34.1
|
%
|
|
34.3
|
%
|
|||||
Other operating expenses
|
|
17.7
|
%
|
|
17.1
|
%
|
|
16.8
|
%
|
|
16.4
|
%
|
|
15.4
|
%
|
|||||
Occupancy costs
|
|
6.2
|
%
|
|
5.7
|
%
|
|
6.0
|
%
|
|
6.0
|
%
|
|
5.9
|
%
|
|
|
Fiscal
Year Ended
|
|||||||
|
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
|||
|
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 weeks)
|
|||
Restaurant sales
|
|
93.3
|
%
|
|
93.9
|
%
|
|
93.9
|
%
|
Culinary contract services
|
|
4.8
|
%
|
|
4.1
|
%
|
|
4.2
|
%
|
Franchise revenue
|
|
1.8
|
%
|
|
1.8
|
%
|
|
1.8
|
%
|
Vending revenue
|
|
0.1
|
%
|
|
0.1
|
%
|
|
0.1
|
%
|
TOTAL SALES
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|||
STORE COSTS AND EXPENSES:
|
|
|
|
|
|
|
|||
(As a percentage of restaurant sales)
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|||
Cost of food
|
|
28.1
|
%
|
|
28.3
|
%
|
|
28.9
|
%
|
Payroll and related costs
|
|
35.9
|
%
|
|
35.2
|
%
|
|
34.5
|
%
|
Other operating expenses
|
|
17.7
|
%
|
|
16.1
|
%
|
|
17.1
|
%
|
Occupancy costs
|
|
6.2
|
%
|
|
5.9
|
%
|
|
5.7
|
%
|
Vending revenue
|
|
(0.2
|
)%
|
|
(0.2
|
)%
|
|
(0.1
|
)%
|
Store level profit
|
|
12.2
|
%
|
|
14.7
|
%
|
|
14.0
|
%
|
|
|
|
|
|
|
|
|||
COMPANY COSTS AND EXPENSES
(as a percentage of total sales)
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|||
Opening costs
|
|
0.1
|
%
|
|
0.2
|
%
|
|
0.7
|
%
|
Depreciation and amortization
|
|
5.4
|
%
|
|
5.4
|
%
|
|
5.4
|
%
|
Selling, general and administrative expenses
|
|
10.1
|
%
|
|
10.5
|
%
|
|
9.8
|
%
|
Provision for asset impairments and restaurant closings
|
|
3.0
|
%
|
|
0.4
|
%
|
|
0.2
|
%
|
Net gain on disposition of property and equipment
|
|
(0.5
|
)%
|
|
(0.2
|
)%
|
|
(1.1
|
)%
|
|
|
|
|
|
|
|
|||
Culinary Contract Services Costs
(as a percentage of Culinary contract services sales)
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|||
Cost of culinary contract services
|
|
87.9
|
%
|
|
89.6
|
%
|
|
90.2
|
%
|
Culinary income
|
|
12.1
|
%
|
|
10.4
|
%
|
|
9.8
|
%
|
|
|
|
|
|
|
|
|||
Franchise Operations Costs
(as a percentage of
Franchise revenue)
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|||
Cost of franchise operations
|
|
25.8
|
%
|
|
25.9
|
%
|
|
24.0
|
%
|
Franchise income
|
|
74.2
|
%
|
|
74.1
|
%
|
|
76.0
|
%
|
|
|
|
|
|
|
|
|||
(As a percentage of total sales)
|
|
|
|
|
|
|
|||
LOSS FROM OPERATIONS
|
|
(4.6
|
)%
|
|
(0.8
|
)%
|
|
(0.2
|
)%
|
Interest income
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
Interest expense
|
|
(0.6
|
)%
|
|
(0.6
|
)%
|
|
(0.6
|
)%
|
Other income (expense), net
|
|
(0.1
|
)%
|
|
0.0
|
%
|
|
0.1
|
%
|
Loss before income taxes and discontinued operations
|
|
(5.3
|
)%
|
|
(1.4
|
)%
|
|
(0.7
|
)%
|
Provision (benefit) for income taxes
|
|
0.6
|
%
|
|
1.2
|
%
|
|
(0.3
|
)%
|
Loss from continuing operations
|
|
(5.9
|
)%
|
|
(2.6
|
)%
|
|
(0.4
|
)%
|
Loss from discontinued operations, net of income taxes
|
|
(0.1
|
)%
|
|
0.0
|
%
|
|
(0.1
|
)%
|
NET LOSS
|
|
(6.0
|
)%
|
|
(2.6
|
)%
|
|
(0.5
|
)%
|
|
|
Fiscal
Year Ended
|
||||||||||
|
|
August 30, 2017
|
|
August 31, 2016
|
|
August 26, 2015
|
||||||
|
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 weeks)
|
||||||
|
|
(In thousands)
|
||||||||||
Store level profit
|
|
$
|
42,943
|
|
|
$
|
55,419
|
|
|
$
|
51,763
|
|
|
|
|
|
|
|
|
||||||
Plus:
|
|
|
|
|
|
|
||||||
Sales from culinary contract services
|
|
17,943
|
|
|
16,695
|
|
|
16,401
|
|
|||
Sales from franchise operations
|
|
6,723
|
|
|
7,250
|
|
|
6,961
|
|
|||
|
|
|
|
|
|
|
||||||
Less:
|
|
|
|
|
|
|
||||||
Opening costs
|
|
492
|
|
|
787
|
|
|
2,743
|
|
|||
Cost of culinary contract services
|
|
15,774
|
|
|
14,955
|
|
|
14,786
|
|
|||
Cost of franchise operations
|
|
1,733
|
|
|
1,877
|
|
|
1,668
|
|
|||
Depreciation and amortization
|
|
20,438
|
|
|
21,889
|
|
|
21,407
|
|
|||
Selling, general and administrative expenses
(1)
|
|
37,878
|
|
|
42,422
|
|
|
38,759
|
|
|||
Provision for asset impairments and restaurant closings
|
|
10,567
|
|
|
1,442
|
|
|
636
|
|
|||
Net gain on disposition of property and equipment
|
|
(1,804
|
)
|
|
(684
|
)
|
|
(3,994
|
)
|
|||
Interest income
|
|
(8
|
)
|
|
(4
|
)
|
|
(4
|
)
|
|||
Interest expense
|
|
2,443
|
|
|
2,247
|
|
|
2,337
|
|
|||
Other income (expense), net
|
|
454
|
|
|
(186
|
)
|
|
(521
|
)
|
|||
Provision (benefit) for income taxes
|
|
2,438
|
|
|
4,875
|
|
|
(1,076
|
)
|
|||
Loss from continuing operations
|
|
$
|
(22,796
|
)
|
|
$
|
(10,256
|
)
|
|
$
|
(1,616
|
)
|
|
|
Fiscal 2017 Year Begin
|
|
Fiscal 2017 Openings
|
|
Fiscal 2017 Closings
|
|
Fiscal 2017 Year End
|
||||
Luby’s Cafeterias
(1)
|
|
91
|
|
|
—
|
|
|
(3
|
)
|
|
88
|
|
Fuddruckers Restaurants
(1)
|
|
75
|
|
|
1
|
|
|
(5
|
)
|
|
71
|
|
Cheeseburger in Paradise
|
|
8
|
|
|
—
|
|
|
—
|
|
|
8
|
|
Other restaurants
(2)
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
Total
|
|
175
|
|
|
1
|
|
|
(9
|
)
|
|
167
|
|
•
|
Total company sales
decreased
approximately
$26.6 million
, or
6.6%
, in fiscal
2017
compared to fiscal
2016
, consisting primarily of an approximate
$27.3 million
decrease
in restaurant sales, an approximate
$1.2 million
increase
in Culinary contract services sales, an approximate
$0.5 million
decrease
in franchise revenue, and a less than $0.1 million
decrease
in vending revenue. The
decrease
in restaurant sales included an approximate
$14.9 million
decrease
in sales at stand-alone Luby's Cafeterias, an approximate
$8.3 million
decrease
in sales at stand-alone Fuddruckers restaurants, an approximate
$1.8 million
decrease
at sales from our Combo locations, and an approximate
$2.2 million
decrease
in sales from Cheeseburger in Paradise restaurants. The approximate
$27.3 million
decrease
in total restaurant sales reflects comparison to fiscal 2016 which included one additional week of operations. Fiscal 2017 was comprised of the typical 52 weeks compared to fiscal 2016 which was comprised of 53 weeks. The additional week of operations in fiscal 2016 generated approximately $6.7 million in restaurant sales in that year. Total restaurant sales declined approximately $4.2 million related to eight restaurants that closed in fiscal
2017
.
|
•
|
Total segment profit
decreased
approximately
$12.4 million
to approximately
$50.1 million
in fiscal
2017
compared to approximately
$62.5 million
in fiscal
2016
. The approximate
$12.4 million
decrease
in total segment profit resulted from a
decrease
of approximately
$12.5 million
in Company-owned restaurant segment profit, an approximate
$0.4 million
decrease
in franchise segment profit, partially offset by an approximate
$0.4 million
increase
in Culinary contract services segment profit. The approximate
$12.5 million
decrease
in Company-owned restaurant segment profit resulted from restaurant sales and vending income decreasing approximately $27.3 million with the cost of food, payroll and related costs, other operating expenses, and occupancy costs decreasing approximately $14.8 million.
|
•
|
Loss before income taxes and discontinued operations included non-cash charges for asset impairments and restaurant closings of approximately
$10.6 million
and approximately
$1.4 million
in fiscal
2017
and fiscal
2016
, respectively. Net loss included non-tax charges for deferred tax asset valuation allowance increases of approximately
$9.5 million
and
$6.9 million
in fiscal
2017
and fiscal
2016
, respectively.
|
•
|
The loss from continuing operations was approximately
$22.8 million
in fiscal
2017
compared to a loss of approximately
$10.3 million
in fiscal
2016
.
|
•
|
Core restaurant brands.
Our core Luby’s Cafeteria and Fuddruckers brands continued to develop and evolve. While our core menu remains stable at our Luby’s Cafeterias, we continue to invest in menu innovation and menu variety. We have introduced new seasonal menu offerings throughout the year that showcase our 70-year history of "made-from-scratch" cooking expertise. Our guests are presented with new offerings at each section of the cafeteria line: fresh colorful vegetable presentations, expanded and refreshed cold sides, and new recipes and presentations for carved turkey, roast beef, salmon, and chicken. We introduce and rotate new menu offerings throughout the year to remain relevant to both our existing customer base and attract new customers. In fiscal
2017
, we also continued to promote our "made-from-scratch" cooking with many locally-sourced “from the farm” ingredients at our Luby’s Cafeterias with our “The Luby’s Way” slogan. “The Luby’s Way” signifies that we are dedicated to serving our guests only the best hand-crafted recipes, prepared fresh each day in our kitchens. We support local farmers and use only the freshest produce and highest quality ingredients. From a marketing and promotion standpoint, we initiated steps to gain an even better understanding of our guests and laid the groundwork for leveraging technology to improve and personalize the guest experience. We will be using these insights to refine our brand positioning strategies going forward. In fiscal
2017
, we significantly reduced our usage of discounting as an incentive to drive guest traffic, focusing our efforts on delivering everyday value and operational excellence.
|
•
|
Franchise Network.
As of
August 30, 2017
, we supported a franchise network of 113 Fuddruckers franchise locations with an additional 76 locations under development agreements. For fiscal
2017
, our franchisees opened eight new Fuddruckers restaurants. Four of the opened locations were in the United States, one in Panama, one in Colombia, one in the Dominican Republic, and one in Canada. For fiscal
2017
, there were eight Fuddruckers franchise locations that closed as franchise-operated restaurants. Our franchise network generated approximately
$6.7 million
in revenue in fiscal
2017
.
|
•
|
Culinary Contract Services.
Our Culinary Contract Services segment generated approximately
$17.9 million
in revenue during fiscal
2017
compared to approximately
$16.7 million
in revenue during fiscal
2016
. The approximate
$1.2 million
increase in revenue was primarily due to the opening of higher sales-volume locations replacing lower sales-volume locations that ceased operations. We view this area as a long-term growth business that generally requires less capital investment and produces favorable percentage returns on invested capital.
|
•
|
Cheeseburger in Paradise Location Strategy.
At Cheeseburger in Paradise, we initiated a strategic plan in fiscal 2014 to revitalize the brand and improve results that included closing under-performing units, converting certain locations to Fuddruckers, and launching initiatives to improve restaurant performance at the remaining units. As of our fiscal year-end
2017
, we operated eight of the original Cheeseburger in Paradise locations. Thirteen of the remaining locations were either converted to Fuddruckers that we operate, sub-leased to Fuddruckers franchisees which they operate, or the lease was terminated. Two locations remain slated for possible conversion to Fuddruckers. Subsequent to the end of fiscal year 2017, we elected to close one Cheeseburger in Paradise location. As of
November 7, 2017
, we operate seven Cheeseburger in Paradise locations.
|
•
|
New Restaurant
Openings.
In fiscal
2017
, we opened one Fuddruckers restaurant north of Houston, Texas. At this location, we introduced the first self-ordering stations to offer guests an additional method of ordering the "World's Greatest Hamburger
®
".
|
•
|
Capital Spending.
Purchases of property and equipment were approximately
$12.5 million
in fiscal
2017
, down from approximately
$18.3 million
in fiscal
2016
. These capital investments were funded through a combination of cash from operations, sale of property, and utilization of our revolving credit facility. Capital investments in fiscal
2017
included (1) approximately $1.1 million on new restaurant development; (2) approximately $4.5 million on the remodeling of existing restaurants and technology infrastructure investments; and (3) approximately $6.9 million for recurring capital expenditures. Our debt balance at the end of fiscal
2017
was approximately
$31.0 million
. We remain committed to maintaining the attractiveness of all of our restaurant locations where we anticipate operating over the long term. In fiscal
2018
, we anticipate making capital investments of up to $12 million, excluding the purchase of land, for recurring maintenance of all of our restaurant properties, for point of sale hardware associated with our technology infrastructure, and to fund our on-going remodeling program.
|
|
|
Fiscal 2017
|
|
Fiscal 2016
|
|
Fiscal 2015
|
||||||||||||||||||||||||||||||
Increase (Decrease)
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
Same-store sales
|
|
(5.1
|
)%
|
|
(2.7
|
)%
|
|
(3.8
|
)%
|
|
(2.3
|
)%
|
|
(0.5
|
)%
|
|
(0.6
|
)%
|
|
2.2
|
%
|
|
1.4
|
%
|
|
0.7
|
%
|
|
(1.1
|
)%
|
|
2.5
|
%
|
|
(0.1
|
)%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Restaurant sales
|
$
|
350,818
|
|
|
$
|
378,111
|
|
|
(7.2
|
)%
|
|
$
|
370,192
|
|
|
2.1
|
%
|
Culinary contract services
|
17,943
|
|
|
16,695
|
|
|
7.5
|
%
|
|
16,401
|
|
|
1.8
|
%
|
|||
Franchise revenue
|
6,723
|
|
|
7,250
|
|
|
(7.3
|
)%
|
|
6,961
|
|
|
4.2
|
%
|
|||
Vending revenue
|
547
|
|
|
583
|
|
|
(6.2
|
)%
|
|
531
|
|
|
9.8
|
%
|
|||
TOTAL SALES
|
$
|
376,031
|
|
|
$
|
402,639
|
|
|
(6.6
|
)%
|
|
$
|
394,085
|
|
|
2.2
|
%
|
Restaurant Brand
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Luby’s Cafeterias
|
$
|
214,976
|
|
|
$
|
229,880
|
|
|
(6.5
|
)%
|
|
$
|
226,970
|
|
|
1.3
|
%
|
Fuddruckers Restaurants
|
98,115
|
|
|
106,456
|
|
|
(7.8
|
)%
|
|
101,290
|
|
|
5.1
|
%
|
|||
Combo locations
|
21,304
|
|
|
23,107
|
|
|
(7.8
|
)%
|
|
23,734
|
|
|
(2.6
|
)%
|
|||
Cheeseburger in Paradise
|
16,423
|
|
|
18,668
|
|
|
(12.0
|
)%
|
|
18,198
|
|
|
2.6
|
%
|
|||
Restaurant Sales
|
$
|
350,818
|
|
|
$
|
378,111
|
|
|
(7.2
|
)%
|
|
$
|
370,192
|
|
|
2.1
|
%
|
•
|
The approximate
$14.9 million
decrease
in sales at stand-alone Luby’s Cafeterias reflects that fiscal 2016 included one additional week of operations which generated approximately $4.1 million in sales in fiscal 2016, a
3.3%
decrease in same-store stand-alone Luby's Cafeteria sales, and a reduction of six operating restaurants. The
3.3%
decrease in same-store sales includes a 5.6% decrease in guest traffic partially offset by a 2.3% increase in average spend per guest.
|
•
|
The approximate
$8.3 million
decrease
in sales at stand-alone Fuddruckers restaurants includes approximately $1.9 million in sales generated in the additional week in fiscal 2016, a
1.8%
decrease in same-store stand-alone Fuddruckers sales, and a net reduction of six operating restaurants. The
1.8%
decrease in same-store sales includes a 4.6% decrease in guest traffic partially offset by a 2.8% increase in average spend per guest.
|
•
|
The approximate
$1.8 million
decrease in sales from Combo locations includes approximately $0.4 million in sales generated in the additional week in fiscal 2016 and a
5.3%
decrease in sales at the six locations in operation throughout fiscal 2016 and fiscal 2017.
|
•
|
The approximate
$2.2 million
decrease
in sales from our Cheeseburger in Paradise restaurants includes approximately $0.3 million in sales generated in the additional week in fiscal 2016 and a
10.5%
decrease in sales at the eight locations in operation throughout fiscal 2016 and fiscal 2017.
|
•
|
The $2.9 million increase in sales at stand-alone Luby’s Cafeterias includes approximately $4.1 million in sales generated in the additional week and a 1.1% increase in same-store stand-alone Luby's Cafeteria sales, offset by a net reduction of four operating restaurants. The 1.1% increase in same-store sales includes a 3.0% increase in guest traffic partially offset by a 1.9% decrease in average spend per guest.
|
•
|
The
$5.1 million
increase
in sales at stand-alone Fuddruckers restaurants includes approximately $1.9 million in sales
|
•
|
The $0.5 million increase in sales from our Cheeseburger in Paradise restaurants includes approximately $0.3 million in sales generated in the additional week and a 0.8% increase in sales at the eight locations in operation, all of which are included in our same-store-grouping.
|
•
|
The $0.6 million decrease in sales from Combo locations includes approximately $0.4 million in sales generated in the additional week offset by decreases in sales at two locations that experienced sales declines when compared against the months immediately following their opening when a high-volume of sales were generated.
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Cost of food
|
$
|
98,714
|
|
|
$
|
106,980
|
|
|
(7.7
|
)%
|
|
$
|
107,052
|
|
|
(0.1
|
)%
|
As a percentage of restaurant sales
|
28.1
|
%
|
|
28.3
|
%
|
|
(0.2
|
)%
|
|
28.9
|
%
|
|
(0.6
|
)%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Payroll and related costs
|
$
|
125,997
|
|
|
$
|
132,960
|
|
|
(5.2
|
)%
|
|
$
|
127,691
|
|
|
4.1
|
%
|
As a percentage of restaurant sales
|
35.9
|
%
|
|
35.2
|
%
|
|
0.7
|
%
|
|
34.5
|
%
|
|
0.7
|
%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Other operating expenses
|
$
|
61,924
|
|
|
$
|
60,961
|
|
|
1.6
|
%
|
|
$
|
63,133
|
|
|
(3.4
|
)%
|
As a percentage of restaurant sales
|
17.7
|
%
|
|
16.1
|
%
|
|
1.6
|
%
|
|
17.1
|
%
|
|
(1.0
|
)%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Occupancy costs
|
$
|
21,787
|
|
|
$
|
22,374
|
|
|
(2.6
|
)%
|
|
$
|
21,084
|
|
|
6.1
|
%
|
As a percentage of restaurant sales
|
6.2
|
%
|
|
5.9
|
%
|
|
0.3
|
%
|
|
5.7
|
%
|
|
0.2
|
%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Franchise revenue
|
$
|
6,723
|
|
|
$
|
7,250
|
|
|
(7.3
|
)%
|
|
$
|
6,961
|
|
|
4.2
|
%
|
Cost of franchise operations
|
1,733
|
|
|
1,877
|
|
|
(7.7
|
)%
|
|
1,668
|
|
|
12.5
|
%
|
|||
Franchise profit
|
$
|
4,990
|
|
|
$
|
5,373
|
|
|
(7.1
|
)%
|
|
$
|
5,293
|
|
|
1.5
|
%
|
Franchise profit as percent of Franchise revenue
|
74.2
|
%
|
|
74.1
|
%
|
|
0.1
|
%
|
|
76.0
|
%
|
|
(1.9
|
)%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Culinary contract services
|
$
|
17,943
|
|
|
$
|
16,695
|
|
|
7.5
|
%
|
|
$
|
16,401
|
|
|
1.8
|
%
|
Cost of culinary contract services
|
15,774
|
|
|
14,955
|
|
|
5.5
|
%
|
|
14,786
|
|
|
1.1
|
%
|
|||
Culinary contract profit
|
$
|
2,169
|
|
|
$
|
1,740
|
|
|
24.7
|
%
|
|
$
|
1,615
|
|
|
7.7
|
%
|
Culinary contract profit as percent of Culinary contract services sales
|
12.1
|
%
|
|
10.4
|
%
|
|
1.7
|
%
|
|
9.8
|
%
|
|
0.6
|
%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
Depreciation and amortization
|
$
|
20,438
|
|
|
$
|
21,889
|
|
|
(6.6
|
)%
|
|
$
|
21,407
|
|
|
2.3
|
%
|
As a percentage of total sales
|
5.4
|
%
|
|
5.4
|
%
|
|
0.0
|
%
|
|
5.4
|
%
|
|
0.0
|
%
|
|
Fiscal Year 2017 Ended
|
|
Fiscal Year 2016 Ended
|
|
Fiscal 2017 vs Fiscal 2016
|
|
Fiscal Year 2015 Ended
|
|
Fiscal 2016 vs Fiscal 2015
|
||||||||
($000s)
|
August 30, 2017
|
|
August 31, 2016
|
|
Higher/(Lower)
|
|
August 26, 2015
|
|
Higher/(Lower)
|
||||||||
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 vs 53 weeks)
|
|
(52 weeks)
|
|
(53 vs 52 weeks)
|
||||||||
General and administrative expenses
|
$
|
32,746
|
|
|
$
|
36,808
|
|
|
(11.0
|
)%
|
|
$
|
35,557
|
|
|
3.5
|
%
|
Marketing and advertising expenses
|
5,132
|
|
|
5,614
|
|
|
(8.6
|
)%
|
|
3,202
|
|
|
75.3
|
%
|
|||
Selling, general and administrative expenses
|
$
|
37,878
|
|
|
$
|
42,422
|
|
|
(10.7
|
)%
|
|
$
|
38,759
|
|
|
9.5
|
%
|
As percent of total sales
|
10.1
|
%
|
|
10.5
|
%
|
|
(0.4
|
)%
|
|
9.8
|
%
|
|
0.7
|
%
|
|
|
Fiscal
Year Ended
|
||||||||||
($000s)
|
|
August 30, 2017
|
|
August 31, 2016
|
|
August 26, 2015
|
||||||
|
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 weeks)
|
||||||
Discontinued operating losses
|
|
$
|
(28
|
)
|
|
$
|
(161
|
)
|
|
$
|
(890
|
)
|
Impairments
|
|
—
|
|
|
—
|
|
|
(90
|
)
|
|||
Gains
|
|
—
|
|
|
25
|
|
|
116
|
|
|||
Pretax loss
|
|
$
|
(28
|
)
|
|
$
|
(136
|
)
|
|
$
|
(864
|
)
|
Income tax benefit (expense) from discontinued operations
|
|
(438
|
)
|
|
46
|
|
|
406
|
|
|||
Loss from discontinued operations, net of income taxes
|
|
$
|
(466
|
)
|
|
$
|
(90
|
)
|
|
$
|
(458
|
)
|
•
|
capital expenditures for recurring maintenance of our restaurant property and equipment, restaurant renovations and upgrades, new construction, and information technology;
|
•
|
payments to reduce our debt; and
|
•
|
working capital primarily for our Company-owned restaurants and obligations under our CCS agreements.
|
|
|
Fiscal Year Ended
|
||||||||||
|
|
August 30, 2017
|
|
August 31, 2016
|
|
August 26, 2015
|
||||||
|
|
(52 weeks)
|
|
(53 weeks)
|
|
(52 weeks)
|
||||||
|
|
(In thousands)
|
||||||||||
Total cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
9,640
|
|
|
$
|
13,859
|
|
|
$
|
10,316
|
|
Investing activities
|
|
(3,216
|
)
|
|
(13,442
|
)
|
|
(7,043
|
)
|
|||
Financing activities
|
|
(6,667
|
)
|
|
(579
|
)
|
|
(4,560
|
)
|
|||
Decrease in cash and cash equivalents
|
|
$
|
(243
|
)
|
|
$
|
(162
|
)
|
|
$
|
(1,287
|
)
|
•
|
CTLAL of not more than (i) 5.00 to 1.00, at the end of each fiscal quarter, through and including the third fiscal quarter of the Borrower’s fiscal 2018, and (ii) 4.75 to 1.00 thereafter,
|
•
|
Consolidated Fixed Charge Coverage Ratio of not less than 1.25 to 1.00, at the end of each fiscal quarter,
|
•
|
Limit on Growth Capital Expenditures so long as the CTLAL is at least 0.25X less than the then-applicable permitted maximum CTLAL,
|
•
|
restrictions on mergers, acquisitions, consolidations, and asset sales,
|
•
|
restrictions on the payment of dividends, redemption of stock, and other distributions,
|
•
|
restrictions on incurring indebtedness, including certain guarantees, and capital lease obligations,
|
•
|
restrictions on incurring liens on certain of our property and the property of our subsidiaries,
|
•
|
restrictions on transactions with affiliates and materially changing our business,
|
•
|
restrictions on making certain investments, loans, advances, and guarantees,
|
•
|
restrictions on selling assets outside the ordinary course of business,
|
•
|
prohibitions on entering into sale and leaseback transactions, and
|
•
|
restrictions on certain acquisitions of all or a substantial portion of the assets, property and/or equity interests of any person, including share repurchases and dividends.
|
•
|
Debt Service Coverage Ratio of not less than (i) 1.10 to 1.00 at all times during the first, second and third fiscal quarters of the Borrower’s fiscal 2015, (ii) 1.25 to 1.00 at all times during the fourth fiscal quarter of the Borrower’s fiscal 2015, and (iii) 1.50 to 1.00 at all times thereafter,
|
•
|
Lease Adjusted Leverage Ratio of not more than (i) 5.75 to 1.00 at all times during the first, second and third fiscal quarters of the Borrower’s fiscal 2015, (ii) 5.50 to 1.00 at all times during the fourth fiscal quarter of the Borrower’s fiscal 2015, (iii) 5.25 to 1.00 at all times during the first fiscal quarter of the Borrower’s fiscal 2016, (iv) 5.00 to 1.00 at all times during the second fiscal quarter of the Borrower’s fiscal 2016, and (v) 4.75 to 1.00 at all times thereafter,
|
•
|
capital expenditures limited to $25.0 million per year,
|
•
|
restrictions on incurring liens on certain of our property and the property of our subsidiaries,
|
•
|
restrictions on transactions with affiliates and materially changing our business,
|
•
|
restrictions on making certain investments, loans, advances and guarantees,
|
•
|
restrictions on selling assets outside the ordinary course of business,
|
•
|
prohibitions on entering into sale and leaseback transactions, and
|
•
|
restrictions on certain acquisitions of all or a substantial portion of the assets, property and/or equity interests of any person, including share repurchases and dividends.
|
|
Payments due by Period
|
||||||||||||||||||
Contractual Obligations
|
Total
|
|
Less than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
After
5 Years
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Revolver
|
$
|
4,400
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,400
|
|
|
$
|
—
|
|
Term Loan
|
26,585
|
|
|
—
|
|
|
2,360
|
|
|
24,225
|
|
|
—
|
|
|||||
Capital lease and other obligations
(1)
|
144
|
|
|
35
|
|
|
104
|
|
|
5
|
|
|
—
|
|
|||||
Operating lease obligations
(2)
|
66,099
|
|
|
11,747
|
|
|
17,865
|
|
|
11,409
|
|
|
25,078
|
|
|||||
Uncertain tax positions liability
(3)
|
25
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
97,253
|
|
|
$
|
11,807
|
|
|
$
|
20,329
|
|
|
$
|
40,039
|
|
|
$
|
25,078
|
|
|
Amount of Commitment by Expiration Period
|
||||||||||||||||||
Other Commercial Commitments
|
Total
|
|
Fiscal
2018
|
|
Fiscal
2019-2020
|
|
Fiscal
2020-2021
|
|
Thereafter
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Letters of credit
|
$
|
1,287
|
|
|
$
|
1,287
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Capital lease obligations contain leases relating to notes on automobile purchases.
|
(2)
|
Operating lease obligations contain rent escalations and renewal options ranging from one to twenty-five years.
|
(3)
|
The timing and amounts of future cash payments related to these liabilities are uncertain.
|
|
August 30,
2017 |
August 31,
2016 |
||||
|
(In thousands, except share data)
|
|||||
ASSETS
|
|
|
||||
Current Assets:
|
|
|
||||
Cash and cash equivalents
|
$
|
1,096
|
|
$
|
1,339
|
|
Trade accounts and other receivables, net
|
8,011
|
|
5,919
|
|
||
Food and supply inventories
|
4,453
|
|
4,596
|
|
||
Prepaid expenses
|
3,431
|
|
3,147
|
|
||
Assets related to discontinued operations
|
—
|
|
1
|
|
||
Deferred income taxes
|
—
|
|
540
|
|
||
Total current assets
|
16,991
|
|
15,542
|
|
||
Property held for sale
|
3,372
|
|
5,522
|
|
||
Assets related to discontinued operations
|
2,755
|
|
3,192
|
|
||
Property and equipment, net
|
172,814
|
|
193,218
|
|
||
Intangible assets, net
|
19,640
|
|
21,074
|
|
||
Goodwill
|
1,068
|
|
1,605
|
|
||
Deferred income taxes
|
7,254
|
|
8,738
|
|
||
Other assets
|
2,563
|
|
3,334
|
|
||
Total assets
|
$
|
226,457
|
|
$
|
252,225
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
||||
Current Liabilities:
|
|
|
||||
Accounts payable
|
$
|
15,937
|
|
$
|
17,539
|
|
Liabilities related to discontinued operations
|
367
|
|
412
|
|
||
Current portion of credit facility debt
|
—
|
|
—
|
|
||
Accrued expenses and other liabilities
|
28,076
|
|
23,752
|
|
||
Total current liabilities
|
44,380
|
|
41,703
|
|
||
Credit facility debt, less current portion
|
30,698
|
|
37,000
|
|
||
Liabilities related to discontinued operations
|
16
|
|
17
|
|
||
Other liabilities
|
7,311
|
|
7,752
|
|
||
Total liabilities
|
82,405
|
|
86,472
|
|
||
Commitments and Contingencies
|
|
|
||||
SHAREHOLDERS’ EQUITY
|
|
|
||||
Common stock, $0.32 par value; 100,000,000 shares authorized; Shares issued were 29,624,083 and 29,440,041, respectively; Shares outstanding were 29,124,083 and 28,940,041, respectively
|
9,480
|
|
9,421
|
|
||
Paid-in capital
|
31,850
|
|
30,348
|
|
||
Retained earnings
|
107,497
|
|
130,759
|
|
||
Less cost of treasury stock, 500,000 shares
|
(4,775
|
)
|
(4,775
|
)
|
||
Total shareholders’ equity
|
144,052
|
|
165,753
|
|
||
Total liabilities and shareholders’ equity
|
$
|
226,457
|
|
$
|
252,225
|
|
|
Year Ended
|
||||||||||
|
August 30, 2017
|
|
August 31, 2016
|
|
August 26, 2015
|
||||||
|
(In thousands,
except per share data)
|
||||||||||
SALES:
|
|
|
|
|
|
||||||
Restaurant sales
|
$
|
350,818
|
|
|
$
|
378,111
|
|
|
$
|
370,192
|
|
Culinary contract services
|
17,943
|
|
|
16,695
|
|
|
16,401
|
|
|||
Franchise revenue
|
6,723
|
|
|
7,250
|
|
|
6,961
|
|
|||
Vending revenue
|
547
|
|
|
583
|
|
|
531
|
|
|||
TOTAL SALES
|
376,031
|
|
|
402,639
|
|
|
394,085
|
|
|||
COSTS AND EXPENSES:
|
|
|
|
|
|
||||||
Cost of food
|
98,714
|
|
|
106,980
|
|
|
107,052
|
|
|||
Payroll and related costs
|
125,997
|
|
|
132,960
|
|
|
127,691
|
|
|||
Other operating expenses
|
61,924
|
|
|
60,961
|
|
|
63,133
|
|
|||
Occupancy costs
|
21,787
|
|
|
22,374
|
|
|
21,084
|
|
|||
Opening costs
|
492
|
|
|
787
|
|
|
2,743
|
|
|||
Cost of culinary contract services
|
15,774
|
|
|
14,955
|
|
|
14,786
|
|
|||
Cost of franchise operations
|
1,733
|
|
|
1,877
|
|
|
1,668
|
|
|||
Depreciation and amortization
|
20,438
|
|
|
21,889
|
|
|
21,407
|
|
|||
Selling, general and administrative expenses
|
37,878
|
|
|
42,422
|
|
|
38,759
|
|
|||
Provision for asset impairments and restaurant closings
|
10,567
|
|
|
1,442
|
|
|
636
|
|
|||
Net gain on disposition of property and equipment
|
(1,804
|
)
|
|
(684
|
)
|
|
(3,994
|
)
|
|||
Total costs and expenses
|
393,500
|
|
|
405,963
|
|
|
394,965
|
|
|||
LOSS FROM OPERATIONS
|
(17,469
|
)
|
|
(3,324
|
)
|
|
(880
|
)
|
|||
Interest income
|
8
|
|
|
4
|
|
|
4
|
|
|||
Interest expense
|
(2,443
|
)
|
|
(2,247
|
)
|
|
(2,337
|
)
|
|||
Other income (expense), net
|
(454
|
)
|
|
186
|
|
|
521
|
|
|||
Loss before income taxes and discontinued operations
|
(20,358
|
)
|
|
(5,381
|
)
|
|
(2,692
|
)
|
|||
Provision (benefit) for income taxes
|
2,438
|
|
|
4,875
|
|
|
(1,076
|
)
|
|||
Loss from continuing operations
|
(22,796
|
)
|
|
(10,256
|
)
|
|
(1,616
|
)
|
|||
Loss from discontinued operations, net of income taxes
|
(466
|
)
|
|
(90
|
)
|
|
(458
|
)
|
|||
NET LOSS
|
$
|
(23,262
|
)
|
|
$
|
(10,346
|
)
|
|
$
|
(2,074
|
)
|
Loss per share from continuing operations:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.77
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.06
|
)
|
Assuming dilution
|
$
|
(0.77
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.06
|
)
|
Loss per share from discontinued operations:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.02
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.01
|
)
|
Assuming dilution
|
$
|
(0.02
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.01
|
)
|
Net loss per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.79
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
Assuming dilution
|
$
|
(0.79
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
Weighted-average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
29,476
|
|
|
29,226
|
|
|
28,974
|
|
|||
Assuming dilution
|
29,476
|
|
|
29,226
|
|
|
28,974
|
|
|
Common Stock
|
|
|
|
|
|
|
||||||||||||||||||
|
Issued
|
|
Treasury
|
|
|
|
|
|
|
||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Paid-In
Capital
|
|
Retained
Earnings
|
|
Total
Shareholders’
Equity
|
||||||||||||
Balance at August 27, 2014
|
28,950
|
|
|
$
|
9,264
|
|
|
(500
|
)
|
|
$
|
(4,775
|
)
|
|
$
|
27,356
|
|
|
$
|
143,179
|
|
|
$
|
175,024
|
|
Net income for the year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,074
|
)
|
|
(2,074
|
)
|
|||||
Common stock issued under nonemployee director benefit plans
|
40
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||||
Common stock issued under employee benefit plans
|
82
|
|
|
26
|
|
|
—
|
|
|
—
|
|
|
164
|
|
|
—
|
|
|
190
|
|
|||||
Increase in excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Share-based compensation expense
|
63
|
|
|
20
|
|
|
—
|
|
|
—
|
|
|
1,494
|
|
|
—
|
|
|
1,514
|
|
|||||
Balance at August 26, 2015
|
29,135
|
|
|
$
|
9,323
|
|
|
(500
|
)
|
|
$
|
(4,775
|
)
|
|
$
|
29,006
|
|
|
$
|
141,105
|
|
|
$
|
174,659
|
|
Net loss for the year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,346
|
)
|
|
(10,346
|
)
|
|||||
Common stock issued under nonemployee director benefit plans
|
60
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|||||
Common stock issued under employee benefit plans
|
177
|
|
|
57
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
82
|
|
|||||
Increase in excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(119
|
)
|
|
—
|
|
|
(119
|
)
|
|||||
Share-based compensation expense
|
68
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
1,455
|
|
|
—
|
|
|
1,477
|
|
|||||
Balance at August 31, 2016
|
29,440
|
|
|
$
|
9,421
|
|
|
(500
|
)
|
|
$
|
(4,775
|
)
|
|
$
|
30,348
|
|
|
$
|
130,759
|
|
|
$
|
165,753
|
|
Net loss for the year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,262
|
)
|
|
(23,262
|
)
|
|||||
Common stock issued under nonemployee director benefit plans
|
83
|
|
|
26
|
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
—
|
|
|
—
|
|
|||||
Common stock issued under employee benefit plans
|
7
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|||||
Share-based compensation expense
|
94
|
|
|
31
|
|
|
—
|
|
|
—
|
|
|
1,530
|
|
|
—
|
|
|
1,561
|
|
|||||
Balance at August 30, 2017
|
29,624
|
|
|
$
|
9,480
|
|
|
(500
|
)
|
|
$
|
(4,775
|
)
|
|
$
|
31,850
|
|
|
$
|
107,497
|
|
|
$
|
144,052
|
|
|
Year Ended
|
||||||||||
|
August 30, 2017
|
|
August 31, 2016
|
|
August 26, 2015
|
||||||
|
(In thousands)
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(23,262
|
)
|
|
$
|
(10,346
|
)
|
|
$
|
(2,074
|
)
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Provision for asset impairments and net loss (gain) on property sales
|
8,762
|
|
|
734
|
|
|
(3,385
|
)
|
|||
Depreciation and amortization
|
20,438
|
|
|
21,906
|
|
|
21,431
|
|
|||
Amortization of debt issuance cost
|
348
|
|
|
313
|
|
|
204
|
|
|||
Share-based compensation expense
|
1,561
|
|
|
1,477
|
|
|
1,514
|
|
|||
Excess tax deficit (benefit) from share-based compensation
|
—
|
|
|
119
|
|
|
(5
|
)
|
|||
Deferred tax provision (benefit)
|
2,792
|
|
|
4,707
|
|
|
(1,996
|
)
|
|||
Cash provided by operating activities before changes in operating asset and liabilities
|
10,639
|
|
|
18,910
|
|
|
15,689
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Increase in trade accounts and other receivables
|
(2,092
|
)
|
|
(744
|
)
|
|
(1,063
|
)
|
|||
Decrease (Increase) in food and supply inventories
|
143
|
|
|
(616
|
)
|
|
1,073
|
|
|||
Decrease (Increase) in prepaid expenses and other assets
|
504
|
|
|
215
|
|
|
(268
|
)
|
|||
Increase (decrease) in accounts payable, accrued expenses and other liabilities
|
446
|
|
|
(3,906
|
)
|
|
(5,115
|
)
|
|||
Net cash provided by operating activities
|
9,640
|
|
|
13,859
|
|
|
10,316
|
|
|||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
||||||
Proceeds from disposal of assets and property held for sale
|
9,286
|
|
|
4,794
|
|
|
13,278
|
|
|||
Repayment of note receivable
|
—
|
|
|
17
|
|
|
57
|
|
|||
Purchases of property and equipment
|
(12,502
|
)
|
|
(18,253
|
)
|
|
(20,378
|
)
|
|||
Net cash used in investing activities
|
(3,216
|
)
|
|
(13,442
|
)
|
|
(7,043
|
)
|
|||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
||||||
Revolver borrowings
|
107,800
|
|
|
106,000
|
|
|
108,000
|
|
|||
Revolver repayments
|
(140,400
|
)
|
|
(106,500
|
)
|
|
(112,500
|
)
|
|||
Debt issuance costs
|
(652
|
)
|
|
(42
|
)
|
|
(255
|
)
|
|||
Proceeds on term loan
|
35,000
|
|
|
—
|
|
|
—
|
|
|||
Term loan repayments
|
(8,415
|
)
|
|
—
|
|
|
—
|
|
|||
Excess tax (deficit) benefit from share-based compensation
|
—
|
|
|
(119
|
)
|
|
5
|
|
|||
Proceeds received on the exercise of employee stock options
|
—
|
|
|
82
|
|
|
190
|
|
|||
Net cash used in financing activities
|
(6,667
|
)
|
|
(579
|
)
|
|
(4,560
|
)
|
|||
Decrease in cash and cash equivalents
|
(243
|
)
|
|
(162
|
)
|
|
(1,287
|
)
|
|||
Cash and cash equivalents at beginning of period
|
1,339
|
|
|
1,501
|
|
|
2,788
|
|
|||
Cash and cash equivalents at end of period
|
$
|
1,096
|
|
|
$
|
1,339
|
|
|
$
|
1,501
|
|
Cash paid for:
|
|
|
|
|
|
||||||
Income taxes
|
$
|
411
|
|
|
$
|
357
|
|
|
$
|
730
|
|
Interest
|
1,787
|
|
|
1,873
|
|
|
2,133
|
|
|
Fiscal Year
Ended
|
||||||||||
|
August 30, 2017
|
|
August 31, 2016
|
|
August 26, 2015
|
||||||
|
(In thousands)
|
||||||||||
Sales:
|
|
|
|
|
|
||||||
Company-owned restaurants
(1)
|
$
|
351,365
|
|
|
$
|
378,694
|
|
|
$
|
370,723
|
|
Culinary contract services
|
17,943
|
|
|
16,695
|
|
|
16,401
|
|
|||
Franchise operations
|
6,723
|
|
|
7,250
|
|
|
6,961
|
|
|||
Total
|
$
|
376,031
|
|
|
$
|
402,639
|
|
|
$
|
394,085
|
|
Segment level profit:
|
|
|
|
|
|
||||||
Company-owned restaurants
|
$
|
42,943
|
|
|
$
|
55,419
|
|
|
$
|
51,763
|
|
Culinary contract services
|
2,169
|
|
|
1,740
|
|
|
1,615
|
|
|||
Franchise operations
|
4,990
|
|
|
5,373
|
|
|
5,293
|
|
|||
Total
|
$
|
50,102
|
|
|
$
|
62,532
|
|
|
$
|
58,671
|
|
Depreciation and amortization:
|
|
|
|
|
|
||||||
Company-owned restaurants
|
$
|
16,948
|
|
|
$
|
18,181
|
|
|
$
|
18,120
|
|
Culinary contract services
|
64
|
|
|
103
|
|
|
177
|
|
|||
Franchise operations
|
770
|
|
|
784
|
|
|
767
|
|
|||
Corporate
|
2,656
|
|
|
2,821
|
|
|
2,343
|
|
|||
Total
|
$
|
20,438
|
|
|
$
|
21,889
|
|
|
$
|
21,407
|
|
Total assets:
|
|
|
|
|
|
||||||
Company-owned restaurants
(2)
|
$
|
189,990
|
|
|
$
|
211,182
|
|
|
$
|
218,492
|
|
Culinary contract services
|
3,342
|
|
|
3,390
|
|
|
1,644
|
|
|||
Franchise operations
(3)
|
11,325
|
|
|
12,266
|
|
|
13,034
|
|
|||
Corporate
|
21,800
|
|
|
25,387
|
|
|
31,088
|
|
|||
Total
|
$
|
226,457
|
|
|
$
|
252,225
|
|
|
$
|
264,258
|
|
Capital expenditures:
|
|
|
|
|
|
||||||
Company-owned restaurants
|
$
|
11,374
|
|
|
$
|
17,258
|
|
|
$
|
19,726
|
|
Culinary contract services
|
3
|
|
|
28
|
|
|
18
|
|
|||
Corporate
|
1,125
|
|
|
967
|
|
|
634
|
|
|||
Total
|
$
|
12,502
|
|
|
$
|
18,253
|
|
|
$
|
20,378
|
|
Loss before income taxes and discontinued operations:
|
|
|
|
|
|
||||||
Segment level profit
|
$
|
50,102
|
|
|
$
|
62,532
|
|
|
$
|
58,671
|
|
Opening costs
|
(492
|
)
|
|
(787
|
)
|
|
(2,743
|
)
|
|||
Depreciation and amortization
|
(20,438
|
)
|
|
(21,889
|
)
|
|
(21,407
|
)
|
|||
Selling, general and administrative expenses
|
(37,878
|
)
|
|
(42,422
|
)
|
|
(38,759
|
)
|
|||
Provision for asset impairments and restaurant closings, net
|
(10,567
|
)
|
|
(1,442
|
)
|
|
(636
|
)
|
|||
Net gain on disposition of property and equipment
|
1,804
|
|
|
684
|
|
|
3,994
|
|
|||
Interest income
|
8
|
|
|
4
|
|
|
4
|
|
|||
Interest expense
|
(2,443
|
)
|
|
(2,247
|
)
|
|
(2,337
|
)
|
|||
Other income, net
|
(454
|
)
|
|
186
|
|
|
521
|
|
|||
Total
|
$
|
(20,358
|
)
|
|
$
|
(5,381
|
)
|
|
$
|
(2,692
|
)
|
•
|
Level 1: Defined as observable inputs such as quoted prices in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis.
|
•
|
Level 2: Defined as pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures.
|
•
|
Level 3: Defined as pricing inputs that are unobservable from objective sources. These inputs may be used with internally developed methodologies that result in management's best estimate of fair value.
|
|
|
|
Fair Value
Measurement Using |
|
|
||||||||||||
|
Fiscal Year Ended August 30, 2017
|
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Valuation Method
|
||||||||
Recurring Fair Value - Liabilities
|
|
|
(In thousands)
|
|
|
|
|
||||||||||
Continuing Operations:
|
|
|
|
|
|
|
|
|
|
||||||||
TSR Performance Based Incentive Plan
(1)
|
$
|
831
|
|
|
$
|
—
|
|
|
$
|
831
|
|
|
$
|
—
|
|
|
Monte Carlo Approach
|
Derivative - Interest Rate Swap
(2)
|
$
|
266
|
|
|
$
|
—
|
|
|
$
|
266
|
|
|
$
|
—
|
|
|
Discounted Cash Flow
|
Total liabilities at Fair Value
|
$
|
1,097
|
|
|
$
|
—
|
|
|
$
|
1,097
|
|
|
$
|
—
|
|
|
|
|
|
|
Fair Value
Measurement Using |
|
|
||||||||||
|
Fiscal Year Ended August 26, 2015
|
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Valuation Method
|
||||||
Recurring Fair Value - Liabilities
|
|
|
(In thousands)
|
|
|
|
|
||||||||
Continuing Operations:
|
|
|
|
|
|
|
|
|
|
||||||
TSR Performance Based Incentive Plan
(1)
|
$
|
108
|
|
|
—
|
|
|
$
|
108
|
|
|
—
|
|
|
Monte Carlo Approach
|
|
|
|
Fair Value
Measurement Using
|
|
|
||||||||||||||
|
Fiscal Year Ended August 30, 2017
|
|
Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
Impairments
(4)
|
||||||||||
Nonrecurring Fair Value Measurements
|
|
|
(In thousands)
|
|
|
|
|
||||||||||||
Continuing Operations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment related to Company-owned restaurants
(1)
|
$
|
5,519
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,519
|
|
|
$
|
(8,571
|
)
|
Goodwill
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(537
|
)
|
|||||
Property held for sale
(3)
|
3,372
|
|
|
—
|
|
|
—
|
|
|
3,372
|
|
|
(977
|
)
|
|||||
Total Nonrecurring Fair Value Measurements
|
$
|
8,891
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,891
|
|
|
$
|
(10,085
|
)
|
|
|
|
Fair Value
Measurement Using |
|
|
||||||||||||||
|
Fiscal Year Ended August 31, 2016
|
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Total
Impairments (4) |
||||||||||
Nonrecurring Fair Value Measurements
|
(In thousands)
|
|
|
||||||||||||||||
Continuing Operations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment related to Company-owned restaurants
(1)
|
$
|
959
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
959
|
|
|
$
|
(738
|
)
|
Goodwill
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|||||
Property held for sale
(3)
|
1,290
|
|
|
—
|
|
|
—
|
|
|
1,290
|
|
|
(463
|
)
|
|||||
Total Nonrecurring Fair Value Measurements
|
$
|
2,249
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,249
|
|
|
$
|
(1,239
|
)
|
|
|
|
Fair Value
Measurement Using |
|
|
||||||||||||||
|
Fiscal Year Ended August 26, 2015
|
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Total
Impairments (3) |
||||||||||
Nonrecurring Fair Value Measurements
|
|
|
(In thousands)
|
|
|
|
|
||||||||||||
Continuing Operations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment related to Company-owned restaurants
(1)
|
$
|
1,350
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,350
|
|
|
$
|
(598
|
)
|
Goodwill
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|||||
Total Nonrecurring Fair Value Measurements
|
$
|
1,350
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,350
|
|
|
$
|
(636
|
)
|
Discontinued Operations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment related to corporate assets
|
$
|
865
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
865
|
|
|
$
|
(90
|
)
|
|
August 30,
2017 |
|
August 31,
2016 |
||||
|
(In thousands)
|
||||||
Trade and other receivables
|
$
|
5,966
|
|
|
$
|
5,161
|
|
Franchise royalties and marketing and advertising receivables
|
687
|
|
|
839
|
|
||
Trade receivables, unbilled
|
1,633
|
|
|
—
|
|
||
Allowance for doubtful accounts
|
(275
|
)
|
|
(81
|
)
|
||
Total Trade accounts and other receivables, net
|
$
|
8,011
|
|
|
$
|
5,919
|
|
|
Fiscal
Year Ended
|
||||||||||
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
||||||
|
(In thousands)
|
||||||||||
Beginning balance
|
$
|
81
|
|
|
$
|
555
|
|
|
$
|
512
|
|
Provisions (reversal) for doubtful accounts
|
200
|
|
|
(18
|
)
|
|
51
|
|
|||
Write-offs
(1)
|
(6
|
)
|
|
(456
|
)
|
|
(8
|
)
|
|||
Ending balance
|
$
|
275
|
|
|
$
|
81
|
|
|
$
|
555
|
|
|
August 30,
2017 |
|
August 31,
2016 |
||||
|
(In thousands)
|
||||||
Deferred income tax assets:
|
|
|
|
||||
Workers’ compensation, employee injury, and general liability claims
|
$
|
486
|
|
|
$
|
466
|
|
Deferred compensation
|
437
|
|
|
552
|
|
||
Net operating losses
|
2,140
|
|
|
1,258
|
|
||
General business and foreign tax credits
|
11,599
|
|
|
11,010
|
|
||
Depreciation, amortization and impairments
|
7,515
|
|
|
1,879
|
|
||
Straight-line rent, dining cards, accruals, and other
|
4,392
|
|
|
3,812
|
|
||
Subtotal
|
26,569
|
|
|
18,977
|
|
||
Valuation allowance
|
(16,871
|
)
|
|
(6,905
|
)
|
||
Total deferred income tax assets
|
9,698
|
|
|
12,072
|
|
||
Deferred income tax liabilities:
|
|
|
|
||||
Property taxes and other
|
1,916
|
|
|
1,828
|
|
||
Total deferred income tax liabilities
|
1,916
|
|
|
1,828
|
|
||
Net deferred income tax asset
|
$
|
7,782
|
|
|
$
|
10,244
|
|
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
||||||
|
(In thousands)
|
||||||||||
Current federal and state income tax expense
|
$
|
329
|
|
|
$
|
128
|
|
|
$
|
523
|
|
Current foreign income tax expense
|
84
|
|
|
82
|
|
|
63
|
|
|||
Deferred income tax expense (benefit)
|
2,025
|
|
|
4,665
|
|
|
(1,662
|
)
|
|||
Total income tax expense (benefit)
|
$
|
2,438
|
|
|
$
|
4,875
|
|
|
$
|
(1,076
|
)
|
|
Fiscal
Year Ended
|
|||||||||||||||||||
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
|||||||||||||||
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|||||||||
|
(In thousands and as a percent of pretax loss from continuing operations)
|
|||||||||||||||||||
Income tax benefit from continuing operations at the federal rate
|
$
|
(6,922
|
)
|
|
34.0
|
%
|
|
$
|
(1,830
|
)
|
|
34.0
|
%
|
|
$
|
(832
|
)
|
|
34.0
|
%
|
Permanent and other differences:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Federal jobs tax credits (wage deductions)
|
200
|
|
|
(1.0
|
)
|
|
226
|
|
|
(4.2
|
)
|
|
302
|
|
|
(12.3
|
)
|
|||
Stock options and restricted stock
|
129
|
|
|
(0.6
|
)
|
|
165
|
|
|
(3.1
|
)
|
|
74
|
|
|
(3.0
|
)
|
|||
Other permanent differences
|
62
|
|
|
(0.3
|
)
|
|
74
|
|
|
(1.4
|
)
|
|
60
|
|
|
(2.5
|
)
|
|||
State income tax, net of federal benefit
|
(45
|
)
|
|
0.2
|
|
|
94
|
|
|
(1.7
|
)
|
|
200
|
|
|
(8.2
|
)
|
|||
General Business Tax Credits
|
(589
|
)
|
|
2.9
|
|
|
(665
|
)
|
|
12.4
|
|
|
(888
|
)
|
|
36.3
|
|
|||
Other
|
84
|
|
|
(0.4
|
)
|
|
(94
|
)
|
|
1.7
|
|
|
8
|
|
|
(0.3
|
)
|
|||
Change in valuation allowance
|
9,519
|
|
|
(46.8
|
)
|
|
6,905
|
|
|
(128.3
|
)
|
|
—
|
|
|
—
|
|
|||
Income tax expense (benefit) from continuing operations
|
$
|
2,438
|
|
|
(12.0
|
)%
|
|
$
|
4,875
|
|
|
(90.6
|
)%
|
|
$
|
(1,076
|
)
|
|
44.0
|
%
|
Balance as of August 27, 2014
|
$
|
62
|
|
Decrease based on prior year tax positions
|
—
|
|
|
Interest Expense
|
1
|
|
|
Balance as of August 26, 2015
|
$
|
63
|
|
Decrease based on prior year tax positions
|
(18
|
)
|
|
Interest Expense
|
—
|
|
|
Balance as of August 31, 2016
|
$
|
45
|
|
Decrease based on prior year tax positions
|
(20
|
)
|
|
Interest Expense
|
—
|
|
|
Balance as of August 30, 2017
|
$
|
25
|
|
|
August 30, 2017
|
|
August 31, 2016
|
|
Estimated
Useful Lives (years)
|
||||||||
|
(In thousands)
|
|
|
|
|
|
|
||||||
Land
|
$
|
60,414
|
|
|
$
|
61,940
|
|
|
|
|
—
|
|
|
Restaurant equipment and furnishings
|
73,411
|
|
|
75,764
|
|
|
3
|
|
to
|
|
15
|
||
Buildings
|
153,041
|
|
|
157,006
|
|
|
20
|
|
to
|
|
33
|
||
Leasehold and leasehold improvements
|
26,953
|
|
|
25,973
|
|
|
|
|
Lesser of lease term or
estimated useful life |
|
|
||
Office furniture and equipment
|
3,684
|
|
|
3,277
|
|
|
3
|
|
to
|
|
10
|
||
Construction in progress
|
35
|
|
|
145
|
|
|
|
|
—
|
|
|
||
|
317,538
|
|
|
324,105
|
|
|
|
|
|
|
|
||
Less accumulated depreciation and amortization
|
(144,724
|
)
|
|
(130,887
|
)
|
|
|
|
|
|
|
||
Property and equipment, net
|
$
|
172,814
|
|
|
$
|
193,218
|
|
|
|
|
|
|
|
Intangible assets, net
|
$
|
19,640
|
|
|
$
|
21,074
|
|
|
15
|
|
to
|
|
21
|
Goodwill
|
$
|
1,068
|
|
|
$
|
1,605
|
|
|
|
|
|
|
|
|
August 30, 2017
|
|
August 31, 2016
|
||||||||||||||||||||
|
(In thousands)
|
|
(In thousands)
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Intangible Assets Subject to Amortization:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fuddruckers trade name and franchise agreements
|
$
|
29,486
|
|
|
$
|
(9,943
|
)
|
|
$
|
19,543
|
|
|
$
|
29,486
|
|
|
$
|
(8,535
|
)
|
|
$
|
20,951
|
|
Cheeseburger in Paradise trade name and license agreements
|
$
|
421
|
|
|
$
|
(324
|
)
|
|
$
|
97
|
|
|
$
|
421
|
|
|
$
|
(298
|
)
|
|
$
|
123
|
|
Intangible assets, net
|
$
|
29,907
|
|
|
$
|
(10,267
|
)
|
|
$
|
19,640
|
|
|
$
|
29,907
|
|
|
$
|
(8,833
|
)
|
|
$
|
21,074
|
|
|
August 30,
2017 |
|
August 31,
2016 |
||||
|
(In thousands)
|
||||||
Salaries, compensated absences, incentives, and bonuses
(1)
|
$
|
5,339
|
|
|
$
|
4,184
|
|
Operating expenses
|
1,041
|
|
|
1,118
|
|
||
Unredeemed gift cards and certificates
|
7,298
|
|
|
6,269
|
|
||
Taxes, other than income
|
9,423
|
|
|
7,882
|
|
||
Accrued claims and insurance
|
1,505
|
|
|
1,577
|
|
||
Income taxes, legal and other
|
3,470
|
|
|
2,722
|
|
||
Total
|
$
|
28,076
|
|
|
$
|
23,752
|
|
|
August 30,
2017 |
|
August 31,
2016 |
||||
|
(In thousands)
|
||||||
Workers’ compensation and general liability insurance reserve
|
$
|
923
|
|
|
$
|
986
|
|
Capital leases
|
109
|
|
|
44
|
|
||
Deferred rent and unfavorable leases
|
5,297
|
|
|
5,565
|
|
||
Deferred compensation
(1)
|
426
|
|
|
895
|
|
||
Fair value derivative - Interest Rate Swap
|
266
|
|
|
—
|
|
||
Other
|
290
|
|
|
262
|
|
||
Total
|
$
|
7,311
|
|
|
$
|
7,752
|
|
|
|
|
|
||||
|
August 30,
2017 |
|
August 31, 2016
|
||||
|
(In thousands)
|
||||||
2013 Credit Agreement - Revolver
|
$
|
—
|
|
|
$
|
37,000
|
|
2016 Credit Agreement - Revolver
|
4,400
|
|
|
—
|
|
||
2016 Credit Agreement - Term Loan
|
26,585
|
|
|
—
|
|
||
Total credit facility debt
|
30,985
|
|
|
37,000
|
|
||
Less unamortized debt issue costs
|
(287
|
)
|
|
—
|
|
||
Total credit facility debt, less unamortized debt issuance costs
|
30,698
|
|
|
37,000
|
|
||
Current portion of credit facility debt
|
—
|
|
|
—
|
|
||
Total
|
30,698
|
|
|
37,000
|
|
•
|
CTLAL of not more than (i)
5.00
to 1.00 at all times through and including the third fiscal quarter of the Borrower’s fiscal 2018, and (ii)
4.75
to 1.00 at all times thereafter,
|
•
|
Consolidated Fixed Charge Coverage Ratio of not less than
1.25
to 1.00, at the end of each fiscal quarter,
|
•
|
Limit on Growth Capital Expenditures so long as the CTLAL is at least
0.25
x less than the then-applicable permitted maximum CTLAL,
|
•
|
restrictions on mergers, acquisitions, consolidations and asset sales,
|
•
|
restrictions on the payment of dividends, redemption of stock and other distributions,
|
•
|
restrictions on incurring indebtedness, including certain guarantees and capital lease obligations,
|
•
|
restrictions on incurring liens on certain of our property and the property of our subsidiaries,
|
•
|
restrictions on transactions with affiliates and materially changing our business,
|
•
|
restrictions on making certain investments, loans, advances and guarantees,
|
•
|
restrictions on selling assets outside the ordinary course of business,
|
•
|
prohibitions on entering into sale and leaseback transactions, and
|
•
|
restrictions on certain acquisitions of all or a substantial portion of the assets, property and/or equity interests of any person, including share repurchases and dividends.
|
•
|
Debt Service Coverage Ratio of not less than (i)
1.10
to 1.00 at all times during the first, second and third fiscal quarters of the Borrower’s fiscal
2015
, (ii)
1.25
to 1.00 at all times during the fourth fiscal quarter of the Borrower’s fiscal
2015
, and (iii)
1.50
to 1.00 at all times thereafter,
|
•
|
Lease Adjusted Leverage Ratio of not more than (i)
5.75
to 1.00 at all times during the first, second and third fiscal quarters of the Borrower’s fiscal
2015
, (ii)
5.50
to 1.00 at all times during the fourth fiscal quarter of the Borrower’s fiscal
2015
, (iii)
5.25
to 1.00 at all times during the first fiscal quarter of the Borrower’s fiscal
2016
, (iv)
5.00
to 1.00 at all times during the second fiscal quarter of the Borrower’s fiscal
2016
, and (v)
4.75
to 1.00 at all times thereafter,
|
•
|
capital expenditures limited to
$25.0 million
per year,
|
•
|
restrictions on incurring indebtedness, including certain guarantees and capital lease obligations,
|
•
|
restrictions on incurring liens on certain of our property and the property of our subsidiaries,
|
•
|
restrictions on transactions with affiliates and materially changing our business,
|
•
|
restrictions on making certain investments, loans, advances and guarantees,
|
•
|
restrictions on selling assets outside the ordinary course of business,
|
•
|
prohibitions on entering into sale and leaseback transactions, and
|
•
|
restrictions on certain acquisitions of all or a substantial portion of the assets, property and/or equity interests of any person, including share repurchases and dividends.
|
|
Fiscal
Year Ended
|
||||||||||
|
August 30, 2017
|
|
August 31, 2016
|
|
August 26, 2015
|
||||||
|
(In thousands, except per share data)
|
||||||||||
Provision for asset impairments and restaurant closings
|
$
|
10,567
|
|
|
$
|
1,442
|
|
|
$
|
636
|
|
Net gain on disposition of property and equipment
|
(1,804
|
)
|
|
(684
|
)
|
|
(3,994
|
)
|
|||
|
|
|
|
|
|
||||||
Total
|
$
|
8,763
|
|
|
$
|
758
|
|
|
$
|
(3,358
|
)
|
Effect on EPS:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.29
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
0.12
|
|
Assuming dilution
|
$
|
(0.29
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
0.12
|
|
|
August 30,
2017 |
|
August 31,
2016 |
||||
|
(In thousands)
|
||||||
Prepaid expenses
|
$
|
—
|
|
|
$
|
1
|
|
Assets related to discontinued operations—current
|
$
|
—
|
|
|
$
|
1
|
|
Property and equipment
|
$
|
1,872
|
|
|
$
|
1,872
|
|
Deferred tax assets
|
883
|
|
|
1,320
|
|
||
Assets related to discontinued operations—non-current
|
$
|
2,755
|
|
|
$
|
3,192
|
|
Deferred income taxes
|
$
|
354
|
|
|
$
|
361
|
|
Accrued expenses and other liabilities
|
13
|
|
|
51
|
|
||
Liabilities related to discontinued operations—current
|
$
|
367
|
|
|
$
|
412
|
|
Other liabilities
|
$
|
16
|
|
|
$
|
17
|
|
Liabilities related to discontinued operations—non-current
|
$
|
16
|
|
|
$
|
17
|
|
|
Fiscal
Year Ended
|
||||||||||
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
||||||
|
(In thousands, except locations)
|
||||||||||
Sales
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Pretax loss
|
$
|
(28
|
)
|
|
$
|
(136
|
)
|
|
$
|
(864
|
)
|
Income tax benefit on discontinued operations
|
$
|
(438
|
)
|
|
$
|
46
|
|
|
$
|
406
|
|
Loss on discontinued operations
|
$
|
(466
|
)
|
|
$
|
(90
|
)
|
|
$
|
(458
|
)
|
Discontinued locations closed during the period
|
0
|
|
|
0
|
|
|
0
|
|
|
Fiscal
Year Ended
|
||||||||||
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
||||||
|
(In thousands, except per share data)
|
||||||||||
Discontinued operating losses
|
$
|
(28
|
)
|
|
$
|
(161
|
)
|
|
$
|
(890
|
)
|
Impairments
|
—
|
|
|
—
|
|
|
(90
|
)
|
|||
Gains
|
—
|
|
|
25
|
|
|
116
|
|
|||
Net loss
|
$
|
(28
|
)
|
|
$
|
(136
|
)
|
|
$
|
(864
|
)
|
Income tax benefit (expense) from discontinued operations
|
(438
|
)
|
|
46
|
|
|
406
|
|
|||
Loss from discontinued operations, net of income taxes
|
$
|
(466
|
)
|
|
$
|
(90
|
)
|
|
$
|
(458
|
)
|
Effect on EPS from discontinued operations—decrease—basic
|
$
|
(0.02
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.01
|
)
|
Balance as of August 27, 2014
|
$
|
991
|
|
Disposals
|
(3,203
|
)
|
|
Net transfers to property held for sale
|
6,748
|
|
|
Balance as of August 26, 2015
|
$
|
4,536
|
|
Disposals
|
(1,488
|
)
|
|
Net transfers to property held for sale
|
2,937
|
|
|
Adjustment to fair value
|
(463
|
)
|
|
Balance as of August 31, 2016
|
$
|
5,522
|
|
Disposals
|
(1,173
|
)
|
|
Adjustment to fair value
|
(977
|
)
|
|
Balance as of August 30, 2017
|
$
|
3,372
|
|
Fiscal Year Ending:
|
(In thousands)
|
||
August 29, 2018
|
$
|
11,747
|
|
August 28, 2019
|
10,088
|
|
|
August 26, 2020
|
7,777
|
|
|
August 25, 2021
|
6,287
|
|
|
August 31, 2022
|
5,122
|
|
|
Thereafter
|
25,078
|
|
|
Total minimum lease payments
|
$
|
66,099
|
|
|
Year Ended
|
||||||||||
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
||||||
|
(In thousands, except percentages)
|
||||||||||
Minimum rent-facilities
|
$
|
11,849
|
|
|
$
|
12,341
|
|
|
$
|
12,547
|
|
Contingent rentals
|
86
|
|
|
164
|
|
|
129
|
|
|||
Minimum rent-equipment
|
758
|
|
|
712
|
|
|
805
|
|
|||
Total rent expense (including amounts in discontinued operations)
|
$
|
12,693
|
|
|
$
|
13,217
|
|
|
$
|
13,481
|
|
Percent of sales
|
3.4
|
%
|
|
3.3
|
%
|
|
3.4
|
%
|
•
|
The Company estimated volatility using its historical share price performance over the expected life of the option. Management believes the historical estimated volatility is materially indicative of expectations about expected future volatility.
|
•
|
The Company uses an estimate of expected lives for options granted during the period based on historical data.
|
•
|
The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option.
|
•
|
The expected dividend yield is based on the Company’s current dividend yield and the best estimate of projected dividend yield for future periods within the expected life of the option.
|
|
Fiscal
Year Ended
|
|||||||
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
|||
|
(In thousands, except percentages)
|
|||||||
Dividend yield
|
0
|
%
|
|
0
|
%
|
|
0
|
%
|
Volatility
|
37.65
|
%
|
|
39.64
|
%
|
|
42.30
|
%
|
Risk-free interest rate
|
1.99
|
%
|
|
1.82
|
%
|
|
1.41
|
%
|
Expected life (in years)
|
5.87
|
|
|
5.58
|
|
|
5.61
|
|
|
Restricted Stock
Units
|
|
Weighted
Average
Fair Value
|
|
Weighted-
Average
Remaining
Contractual Term
|
||||
|
|
|
(Per share)
|
|
(In years)
|
||||
Unvested at August 27, 2014
|
397,837
|
|
|
$
|
6.03
|
|
|
1.6
|
|
Granted
|
84,495
|
|
|
4.54
|
|
|
—
|
|
|
Vested
|
(72,915
|
)
|
|
4.55
|
|
|
—
|
|
|
Forfeited
|
—
|
|
|
—
|
|
|
—
|
|
|
Unvested at August 26, 2015
|
409,417
|
|
|
$
|
5.98
|
|
|
1.6
|
|
Granted
|
172,212
|
|
|
4.87
|
|
|
—
|
|
|
Vested
|
(257,482
|
)
|
|
6.19
|
|
|
—
|
|
|
Forfeited
|
(9,314
|
)
|
|
5.37
|
|
|
—
|
|
|
Unvested at August 31, 2016
|
314,833
|
|
|
$
|
5.23
|
|
|
1.9
|
|
Granted
|
200,549
|
|
|
4.26
|
|
|
—
|
|
|
Vested
|
(92,058
|
)
|
|
6.30
|
|
|
—
|
|
|
Forfeited
|
(18,960
|
)
|
|
4.55
|
|
|
—
|
|
|
Unvested at August 30, 2017
|
404,364
|
|
|
$
|
4.54
|
|
|
1.8
|
|
|
Fiscal
Year Ended
|
||||||||||
|
August 30,
2017 |
|
August 31,
2016 |
|
August 26,
2015 |
||||||
|
(In thousands, except per share data)
|
||||||||||
Numerator:
|
|
|
|
|
|
||||||
Loss from continuing operations
|
$
|
(22,796
|
)
|
|
$
|
(10,256
|
)
|
|
$
|
(1,616
|
)
|
NET LOSS
|
$
|
(23,262
|
)
|
|
$
|
(10,346
|
)
|
|
$
|
(2,074
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Denominator for basic earnings per share—weighted-average shares
|
29,476
|
|
|
29,226
|
|
|
28,974
|
|
|||
Effect of potentially dilutive securities:
|
|
|
|
|
|
||||||
Employee and non-employee stock options
|
—
|
|
|
—
|
|
|
—
|
|
|||
Denominator for earnings per share assuming dilution
|
29,476
|
|
|
29,226
|
|
|
28,974
|
|
|||
Loss from continuing operations:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.77
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.06
|
)
|
Assuming dilution
(a)
|
$
|
(0.77
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.06
|
)
|
Net loss per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.79
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
Assuming dilution
(a)
|
$
|
(0.79
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
|
Quarter Ended
(a)
|
||||||||||||||
|
August 30,
2017 |
|
June 7,
2017 |
|
March 15,
2017 |
|
December 21,
2016 |
||||||||
|
(84 days)
|
|
(84 days)
|
|
(84 days)
|
|
(112 days)
|
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Restaurant sales
|
$
|
79,078
|
|
|
$
|
82,594
|
|
|
$
|
81,064
|
|
|
$
|
108,082
|
|
Franchise revenue
|
1,556
|
|
|
1,477
|
|
|
1,819
|
|
|
1,871
|
|
||||
Culinary contract services
|
5,825
|
|
|
4,515
|
|
|
3,306
|
|
|
4,297
|
|
||||
Vending revenue
|
130
|
|
|
133
|
|
|
125
|
|
|
159
|
|
||||
Total sales
|
$
|
86,589
|
|
|
$
|
88,719
|
|
|
$
|
86,314
|
|
|
$
|
114,409
|
|
Loss from continuing operations
|
(4,069
|
)
|
|
(377
|
)
|
|
(12,836
|
)
|
|
(5,514
|
)
|
||||
Income (loss) from discontinued operations
|
(32
|
)
|
|
(19
|
)
|
|
(343
|
)
|
|
(72
|
)
|
||||
Net loss
|
$
|
(4,101
|
)
|
|
$
|
(396
|
)
|
|
$
|
(13,179
|
)
|
|
$
|
(5,586
|
)
|
Net loss per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.14
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.45
|
)
|
|
$
|
(0.19
|
)
|
Assuming dilution
|
$
|
(0.14
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.45
|
)
|
|
$
|
(0.19
|
)
|
Costs and Expenses (
as a percentage of restaurant sales
)
|
|
|
|
|
|
|
|||||||||
Cost of food
|
28.3
|
%
|
|
27.8
|
%
|
|
27.9
|
%
|
|
28.5
|
%
|
||||
Payroll and related costs
|
36.1
|
%
|
|
35.7
|
%
|
|
36.1
|
%
|
|
35.8
|
%
|
||||
Other operating expenses
|
18.6
|
%
|
|
16.7
|
%
|
|
17.0
|
%
|
|
18.2
|
%
|
||||
Occupancy costs
|
6.4
|
%
|
|
6.0
|
%
|
|
6.6
|
%
|
|
6.0
|
%
|
|
Quarter Ended
(a)
|
||||||||||||||
|
August 31, 2016
|
|
June 1,
2016 |
|
March 9,
2016 |
|
December 16,
2015 |
||||||||
|
(91 days)
|
|
(84 days)
|
|
(84 days)
|
|
(112 days)
|
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Restaurant sales
|
$
|
91,775
|
|
|
$
|
86,476
|
|
|
$
|
86,314
|
|
|
$
|
113,546
|
|
Franchise revenue
|
1,839
|
|
|
1,586
|
|
|
1,700
|
|
|
2,125
|
|
||||
Culinary contract services
|
3,970
|
|
|
3,892
|
|
|
3,918
|
|
|
4,915
|
|
||||
Vending revenue
|
145
|
|
|
143
|
|
|
137
|
|
|
158
|
|
||||
Total sales
|
$
|
97,729
|
|
|
$
|
92,097
|
|
|
92,069
|
|
|
$
|
120,744
|
|
|
Loss from continuing operations
|
(7,789
|
)
|
|
(147
|
)
|
|
(582
|
)
|
|
(1,738
|
)
|
||||
Income (loss) from discontinued operations
|
(13
|
)
|
|
13
|
|
|
(17
|
)
|
|
(73
|
)
|
||||
Net loss
|
$
|
(7,802
|
)
|
|
$
|
(134
|
)
|
|
$
|
(599
|
)
|
|
$
|
(1,811
|
)
|
Net loss per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.27
|
)
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
|
$
|
(0.06
|
)
|
Assuming dilution
|
$
|
(0.27
|
)
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
|
$
|
(0.06
|
)
|
Costs and Expenses (
as a percentage of restaurant sales
)
|
|
|
|
|
|
|
|||||||||
Cost of food
|
28.0
|
%
|
|
28.0
|
%
|
|
28.5
|
%
|
|
28.6
|
%
|
||||
Payroll and related costs
|
35.9
|
%
|
|
35.6
|
%
|
|
34.6
|
%
|
|
34.7
|
%
|
||||
Other operating expenses
|
16.6
|
%
|
|
15.7
|
%
|
|
15.9
|
%
|
|
16.2
|
%
|
||||
Occupancy costs
|
5.6
|
%
|
|
5.9
|
%
|
|
6.4
|
%
|
|
5.8
|
%
|
1
.
|
Financial Statements
|
|
The following financial statements are filed as part of this Report:
|
|
Consolidated balance sheets at August 30, 2017 and August 31, 2016.
|
|
Consolidated statements of operations for each of the three years in the period ended August 30, 2017.
|
|
Consolidated statements of shareholders’ equity for each of the three years in the period ended August 30, 2017.
|
|
Consolidated statements of cash flows for each of the three years in the period ended August 30, 2017.
|
|
Notes to consolidated financial statements
|
|
Reports of Independent Registered Public Accounting Firm Grant Thornton LLP
|
2
.
|
Financial Statement Schedules
|
3
.
|
Exhibits
|
3(a)
|
|
|
|
3(b)
|
|
|
|
3(c)
|
|
|
|
10(a)
|
|
|
|
10(b)
|
|
|
|
10(c)
|
|
|
|
10(d)
|
|
|
|
10(e)
|
|
|
|
10(f)
|
|
|
|
10(g)
|
|
|
|
10(h)
|
|
|
|
10(i)
|
|
|
|
10(j)
|
|
|
|
10(k)
|
|
|
|
10(l)
|
|
|
|
10(m)
|
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10(n)
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10(o)
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101.SCH
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XBRL Schema Document
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101.CAL
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XBRL Calculation Linkbase Document
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101.DEF
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XBRL Definition Linkbase Document
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101.LAB
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XBRL Label Linkbase Document
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101.PRE
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XBRL Presentation Linkbase Document
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*
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Denotes management contract or compensatory plan or arrangement.
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**
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Information required to be presented in Exhibit 11 is provided in Note 17 “Earnings Per Share” of the Notes to Consolidated Financial Statements under Part II, Item 8 of this Form 10-K in accordance with the provisions of FASB Statement of Financial Accounting Standards (SFAS) No. 128, Earnings per Share.
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November 13, 2017
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LUBY’S, INC.
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Date
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(Registrant)
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By:
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/s/ CHRISTOPHER J. PAPPAS
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Christopher J. Pappas
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President and Chief Executive Officer
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Signature and Title
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Date
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/S/ GASPER MIR, III
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November 13, 2017
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Gasper Mir, III, Director and Chairman of the Board
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/S/ CHRISTOPHER J. PAPPAS
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November 13, 2017
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Christopher J. Pappas, Director, President and Chief
Executive Officer
(Principal Executive Officer)
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/S/ PETER TROPOLI
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November 13, 2017
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Peter Tropoli, Director and Chief Operating Officer
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/S/ K. SCOTT GRAY
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November 13, 2017
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K. Scott Gray, Senior Vice President and Chief Financial
Officer, and Principal Accounting Officer
(Principal Financial and Accounting Officer)
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/S/ HARRIS J. PAPPAS
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November 13, 2017
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Harris J. Pappas, Director
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/S/ GERALD W. BODZY
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November 13, 2017
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Gerald W. Bodzy, Director
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/S/ JUDITH B. CRAVEN
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November 13, 2017
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Judith B. Craven, Director
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/S/ ARTHUR R. EMERSON
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November 13, 2017
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Arthur R. Emerson, Director
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/S/ JILL GRIFFIN
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November 13, 2017
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Jill Griffin, Director
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/S/ FRANK MARKANTONIS
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November 13, 2017
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Frank Markantonis, Director
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/S/ JOE C. MCKINNEY
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November 13, 2017
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Joe C. McKinney, Director
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NAME
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STATE OR COUNTRY OF ORGANIZATION
OR INCORPORATION
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Luby’s Fuddruckers Restaurants, LLC
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Texas
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Luby’s Bevco, Inc.
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Texas
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Luby’s Bev I, LLC
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Texas
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Luby’s Bev II, LLC
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Texas
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Fuddruckers of Annapolis, LLC
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Maryland
|
Fuddruckers of Brandywine, LLC
|
Maryland
|
Paradise Cheeseburgers, LLC
|
Texas
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Paradise Restaurant Group, LLC
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Delaware
|
Cheeseburger of Algonquin, LLC
|
Illinois
|
Cheeseburger of California, LLC
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Maryland
|
Cheeseburger of Downers Grove, LLC
|
Illinois
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Cheeseburger of Evansville, LLC
|
Indiana
|
Cheeseburger of Fishers, LLC
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Indiana
|
Cheeseburger of Fredericksburg, LLC
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Virginia
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Cheeseburger of Ft. Meyers, LLC
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Florida
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Cheeseburger of Hilliard, LLC
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Ohio
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Cheeseburger of Kansas City, LLC
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Kansas
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Cheeseburger of Middleton, LLC
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Wisconsin
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Cheeseburger of Myrtle Beach, LLC
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South Carolina
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Cheeseburger of Newark, LLC
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Delaware
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Cheeseburger of Newport News, LLC
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Virginia
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High Tides of Omaha, LLC
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Nebraska
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Cheeseburger of Pasadena, LLC
|
Maryland
|
Cheeseburger of Sandestin, LLC
|
Florida
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Cheeseburger of Secaucus, LLC
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New Jersey
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Cheeseburger of Southport, LLC
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Indiana
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Cheeseburger of Sterling Heights, LLC
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Michigan
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Cheeseburger of Terre Haute, LLC
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Indiana
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Cheeseburger of Virgina Beach, LLC
|
Virginia
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Cheeseburger of Wallkill, LLC
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New York
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Cheeseburger of Woodbridge, LLC
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Virginia
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Cheeseburger in Paradise of Anne Arundel County, Inc.
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Maryland
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Cheeseburger in Paradise of St. Mary’s County, LLC
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Maryland
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Luby's Fuddruckers Foundation
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Texas
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/s/ GRANT THORNTON LLP
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Houston, Texas
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November 13, 2017
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Date: November 13, 2017
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By:
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/s/ CHRISTOPHER J. PAPPAS
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|
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Christopher J. Pappas
|
|
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President and Chief Executive Officer
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Date: November 13, 2017
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By:
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/s/ K. SCOTT GRAY
|
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K. Scott Gray
|
|
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Senior Vice President and Chief Financial Officer,
and Principal Accounting Officer
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Date: November 13, 2017
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By:
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/s/ CHRISTOPHER J. PAPPAS
|
|
|
Christopher J. Pappas
|
|
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President and Chief Executive Officer
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Date: November 13, 2017
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By:
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/s/ K. SCOTT GRAY
|
|
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K. Scott Gray
|
|
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Senior Vice President and Chief Financial Officer,
and Principal Accounting Officer
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