(Mark One)
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☒
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2019
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OR
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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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For the transition period from to
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Delaware
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95-3038279
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(State or other jurisdiction
of incorporation or organization)
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(I.R.S. Employer Identification No.)
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450 North Brand Boulevard,
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Glendale,
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CA
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91203-1903
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(Address of principal executive offices)
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(Zip Code)
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(818)
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240-6055
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(Registrant’s telephone number, including area code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, $0.01 par value
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DIN
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New York Stock Exchange
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Large accelerated filer
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☒
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Page
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•
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Our two franchise operations (each a separate operating segment) - primarily royalties, advertising fees and other income from 1,718 Applebee’s franchised restaurants and 1,841 IHOP franchised and area licensed restaurants;
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•
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Rental operations - primarily rental income derived from lease or sublease agreements covering 657 IHOP franchised restaurants and two Applebee’s franchised restaurants;
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•
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Financing operations - primarily interest income from approximately $56 million of receivables for equipment leases and franchise fee notes generally associated with IHOP franchised restaurants developed before 2003 and approximately $23 million of notes receivable from Applebee's franchisees; and
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•
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Company restaurant operations - retail sales from 69 Applebee's company-operated restaurants we acquired from a former Applebee's franchisee in December 2018.
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•
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make it more difficult for us to satisfy our obligations with respect to our debt or refinance any of our debt on attractive terms, commercially reasonable terms, or at all;
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•
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increase our vulnerability to general adverse economic and industry conditions or a downturn in our business;
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•
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require us to dedicate a substantial portion of our cash flow from operations to debt service, thereby reducing the availability of our cash flow to pay dividends to our stockholders, repurchase shares of our common stock, fund working capital, capital expenditures and other general corporate purposes;
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•
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limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
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•
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place us at a competitive disadvantage compared to our competitors that are not as highly leveraged;
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•
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limit our ability to borrow additional funds;
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•
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prevent us from taking actions that we believe would be in the best interest of our business and make it difficult for us to successfully execute our business strategy;
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•
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subject us to risks associated with rising interest rates and uncertainty related to the proposed phase-out of the London Interbank Offered Rate (LIBOR); and
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•
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result in an event of default if we fail to satisfy our obligations under our debt or fail to comply with the financial and other restrictive covenants contained in our debt documents, which event of default could result in all of our debt becoming immediately due and payable and could permit certain of our lenders to foreclose on our assets securing such debt.
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•
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the demand for Applebee’s and IHOP restaurants and the selection of appropriate franchisee candidates;
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•
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costs of construction, permit issuance and regulatory compliance;
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•
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the availability of suitable locations and terms for potential development sites, including lease or purchase terms for new locations;
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•
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the availability of financing, at acceptable rates and terms, to both franchisees and third-party landlords, for restaurant development and/or implementation of our business strategy through new remodel programs and other operational changes;
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•
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delays in obtaining construction permits and in completion of construction;
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•
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competition for suitable development sites;
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•
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changes in governmental rules, regulations, and interpretations (including interpretations of the requirements of the Americans with Disabilities Act); and
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•
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general economic and business conditions.
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•
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inability or unwillingness of franchisees to participate in implementing changes or to participate in business strategy changes;
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•
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inability or unwillingness of franchisees to support our marketing programs and strategic initiatives;
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•
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inability of franchisees to participate in business strategy changes due to financial constraints;
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•
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failure of franchisees to report sales information accurately;
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•
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greater proportional impact of general and administrative expenses on our business and financial condition; and
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•
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inability to retain franchisees in the future, both in terms of number and quality, and inability to attract, retain and motivate sufficient numbers of franchisees of the same caliber, including top performing franchisees.
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•
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changes in consumer behavior driven by macro-level shifts in retail, technology, media, e-commerce, global safety and demography which may impact where, when, whether and how often customers visit full-service restaurants;
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•
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declines in comparable restaurant sales growth rates due to: (i) failure to meet or adequately adapt to changing customer expectations for food type, quality and taste, or to innovate and develop new menu items to retain existing customers and attract new customers; (ii) competitive intrusions in our markets, including competitive pricing initiatives and daypart expansion by competitors; (iii) opening new restaurants that cannibalize the sales of existing restaurants; (iv) failure of national or local marketing to be effective; and (v) natural or man-made disasters or adverse weather conditions;
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•
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negative trends in operating expenses such as: (i) increases in food and other commodity costs or related distribution costs; (ii) increases in labor costs due to minimum wage and other employment laws or regulations, immigration reform, the potential impact of union organizing efforts and tight labor market conditions; and (iii) increases in other operating costs including advertising, utilities, lease-related expenses and credit card processing fees;
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•
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the highly competitive nature of the restaurant and related industries with respect to, among other things: (i) price, service, location, personnel and the type and quality of food; (ii) the trend toward convergence in grocery, deli, retail and restaurant services, as well as the continued expansion of restaurants into the breakfast daypart; (iii) the entry of major market players in non-competing industries into the food services market; (iv) the decline in the price of groceries which may increase the attractiveness of dining at home versus dining out; and (v) the emergence of new or improved technologies and changes in consumer behavior facilitated by such technology;
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•
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the inability to increase menu pricing to offset increased operating expenses; and
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•
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failure to effectively manage further penetration into mature markets.
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Applebee's (a)
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IHOP (a)
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||||||||||||||
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Franchise
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Company
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Total Applebee's
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Franchise
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Area License
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Total IHOP
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||||||
United States
|
|
|
|
|
|
|
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||||||
Alabama
|
30
|
|
|
—
|
|
|
30
|
|
|
18
|
|
|
—
|
|
|
18
|
|
Alaska
|
1
|
|
|
—
|
|
|
1
|
|
|
4
|
|
|
—
|
|
|
4
|
|
Arizona
|
22
|
|
|
—
|
|
|
22
|
|
|
45
|
|
|
—
|
|
|
45
|
|
Arkansas
|
8
|
|
|
—
|
|
|
8
|
|
|
17
|
|
|
—
|
|
|
17
|
|
California
|
111
|
|
|
—
|
|
|
111
|
|
|
233
|
|
|
—
|
|
|
233
|
|
Colorado
|
24
|
|
|
—
|
|
|
24
|
|
|
37
|
|
|
—
|
|
|
37
|
|
Connecticut
|
6
|
|
|
—
|
|
|
6
|
|
|
9
|
|
|
—
|
|
|
9
|
|
Delaware
|
12
|
|
|
—
|
|
|
12
|
|
|
7
|
|
|
—
|
|
|
7
|
|
District of Columbia
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
Florida
|
103
|
|
|
—
|
|
|
103
|
|
|
—
|
|
|
146
|
|
(b)
|
146
|
|
Georgia
|
63
|
|
|
—
|
|
|
63
|
|
|
78
|
|
|
3
|
|
|
81
|
|
Hawaii
|
2
|
|
|
—
|
|
|
2
|
|
|
7
|
|
|
—
|
|
|
7
|
|
Idaho
|
12
|
|
|
—
|
|
|
12
|
|
|
8
|
|
|
—
|
|
|
8
|
|
Illinois
|
39
|
|
|
—
|
|
|
39
|
|
|
51
|
|
|
—
|
|
|
51
|
|
Indiana
|
58
|
|
|
—
|
|
|
58
|
|
|
24
|
|
|
—
|
|
|
24
|
|
Iowa
|
26
|
|
|
—
|
|
|
26
|
|
|
12
|
|
|
—
|
|
|
12
|
|
Kansas
|
31
|
|
|
—
|
|
|
31
|
|
|
30
|
|
|
—
|
|
|
30
|
|
Kentucky
|
27
|
|
|
—
|
|
|
27
|
|
|
11
|
|
|
—
|
|
|
11
|
|
Louisiana
|
14
|
|
|
—
|
|
|
14
|
|
|
31
|
|
|
—
|
|
|
31
|
|
Maine
|
12
|
|
|
—
|
|
|
12
|
|
|
4
|
|
|
—
|
|
|
4
|
|
Maryland
|
22
|
|
|
—
|
|
|
22
|
|
|
52
|
|
|
—
|
|
|
52
|
|
Massachusetts
|
27
|
|
|
—
|
|
|
27
|
|
|
22
|
|
|
—
|
|
|
22
|
|
Michigan
|
86
|
|
|
—
|
|
|
86
|
|
|
26
|
|
|
—
|
|
|
26
|
|
Minnesota
|
48
|
|
|
—
|
|
|
48
|
|
|
9
|
|
|
—
|
|
|
9
|
|
Mississippi
|
21
|
|
|
—
|
|
|
21
|
|
|
13
|
|
|
—
|
|
|
13
|
|
Missouri
|
49
|
|
|
—
|
|
|
49
|
|
|
33
|
|
|
—
|
|
|
33
|
|
Montana
|
8
|
|
|
—
|
|
|
8
|
|
|
5
|
|
|
—
|
|
|
5
|
|
Nebraska
|
18
|
|
|
—
|
|
|
18
|
|
|
6
|
|
|
—
|
|
|
6
|
|
Nevada
|
13
|
|
|
—
|
|
|
13
|
|
|
22
|
|
|
—
|
|
|
22
|
|
New Hampshire
|
13
|
|
|
—
|
|
|
13
|
|
|
6
|
|
|
—
|
|
|
6
|
|
New Jersey
|
58
|
|
|
—
|
|
|
58
|
|
|
49
|
|
|
—
|
|
|
49
|
|
New Mexico
|
20
|
|
|
—
|
|
|
20
|
|
|
22
|
|
|
—
|
|
|
22
|
|
New York
|
104
|
|
|
—
|
|
|
104
|
|
|
58
|
|
|
—
|
|
|
58
|
|
North Carolina
|
1
|
|
|
42
|
|
|
43
|
|
|
56
|
|
|
—
|
|
|
56
|
|
North Dakota
|
11
|
|
|
—
|
|
|
11
|
|
|
2
|
|
|
—
|
|
|
2
|
|
Ohio
|
77
|
|
|
—
|
|
|
77
|
|
|
39
|
|
|
—
|
|
|
39
|
|
Oklahoma
|
13
|
|
|
—
|
|
|
13
|
|
|
33
|
|
|
—
|
|
|
33
|
|
Oregon
|
17
|
|
|
—
|
|
|
17
|
|
|
11
|
|
|
—
|
|
|
11
|
|
Pennsylvania
|
80
|
|
|
—
|
|
|
80
|
|
|
28
|
|
|
—
|
|
|
28
|
|
Rhode Island
|
8
|
|
|
—
|
|
|
8
|
|
|
5
|
|
|
—
|
|
|
5
|
|
South Carolina
|
—
|
|
|
27
|
|
|
27
|
|
|
33
|
|
|
—
|
|
|
33
|
|
South Dakota
|
6
|
|
|
—
|
|
|
6
|
|
|
2
|
|
|
—
|
|
|
2
|
|
Tennessee
|
29
|
|
|
—
|
|
|
29
|
|
|
40
|
|
|
—
|
|
|
40
|
|
Texas
|
96
|
|
|
—
|
|
|
96
|
|
|
211
|
|
|
—
|
|
|
211
|
|
Utah
|
9
|
|
|
—
|
|
|
9
|
|
|
22
|
|
|
—
|
|
|
22
|
|
Vermont
|
3
|
|
|
—
|
|
|
3
|
|
|
1
|
|
|
—
|
|
|
1
|
|
Virginia
|
62
|
|
|
—
|
|
|
62
|
|
|
69
|
|
|
—
|
|
|
69
|
|
Washington
|
41
|
|
|
—
|
|
|
41
|
|
|
32
|
|
|
—
|
|
|
32
|
|
West Virginia
|
16
|
|
|
—
|
|
|
16
|
|
|
8
|
|
|
—
|
|
|
8
|
|
Wisconsin
|
35
|
|
|
—
|
|
|
35
|
|
|
15
|
|
|
—
|
|
|
15
|
|
Wyoming
|
4
|
|
|
—
|
|
|
4
|
|
|
3
|
|
|
—
|
|
|
3
|
|
Total Domestic
|
1,596
|
|
|
69
|
|
|
1,665
|
|
|
1,561
|
|
|
149
|
|
|
1,710
|
|
|
Applebee's (a)
|
|
IHOP (a)
|
||||||||||||||
|
Franchise
|
|
Company
|
|
Total Applebee's
|
|
Franchise
|
|
Area License
|
|
Total IHOP
|
||||||
International
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Bahrain
|
1
|
|
|
—
|
|
|
1
|
|
|
3
|
|
|
—
|
|
|
3
|
|
Brazil
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Canada
|
15
|
|
|
—
|
|
|
15
|
|
|
15
|
|
|
12
|
|
(b)
|
27
|
|
Dominican Republic
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ecuador
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
Egypt
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Guam
|
1
|
|
|
—
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
2
|
|
Guatemala
|
4
|
|
|
—
|
|
|
4
|
|
|
1
|
|
|
—
|
|
|
1
|
|
India
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
Indonesia
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Kuwait
|
6
|
|
|
—
|
|
|
6
|
|
|
8
|
|
|
—
|
|
|
8
|
|
Mexico
|
51
|
|
|
—
|
|
|
51
|
|
|
47
|
|
|
—
|
|
|
47
|
|
Northern Mariana Islands
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
Panama
|
2
|
|
|
—
|
|
|
2
|
|
|
4
|
|
|
—
|
|
|
4
|
|
Peru
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
Puerto Rico
|
7
|
|
|
—
|
|
|
7
|
|
|
6
|
|
|
—
|
|
|
6
|
|
Qatar
|
8
|
|
|
—
|
|
|
8
|
|
|
1
|
|
|
—
|
|
|
1
|
|
Saudi Arabia
|
21
|
|
|
—
|
|
|
21
|
|
|
17
|
|
|
—
|
|
|
17
|
|
Thailand
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
United Arab Emirates
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
Total International
|
122
|
|
|
—
|
|
|
122
|
|
|
119
|
|
|
12
|
|
|
131
|
|
Totals
|
1,718
|
|
|
69
|
|
|
1,787
|
|
|
1,680
|
|
|
161
|
|
|
1,841
|
|
Purchases of Equity Securities by the Company
|
||||||||||||
Period
|
|
Total number of
shares
purchased
|
|
Average price
paid per
share
|
|
Total number of
shares purchased as
part of publicly
announced plans or
programs (c)
|
|
Approximate dollar value of
shares that may yet be
purchased under the
plans or programs (c)
|
||||
September 29, 2019 – October 27, 2019(a)
|
|
283
|
|
|
$72.28
|
|
—
|
|
|
$
|
118,300,000
|
|
October 28, 2019 – November 24, 2019(b)
|
|
201,824
|
|
|
$74.83
|
|
200,527
|
|
|
$
|
103,300,000
|
|
November 25, 2019 – December 29, 2019(b)
|
|
80,512
|
|
|
$82.47
|
|
80,324
|
|
|
$
|
96,700,000
|
|
Total
|
|
282,619
|
|
|
$77.01
|
|
280,851
|
|
|
$
|
96,700,000
|
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
||||||||||||
Dine Brands Global, Inc.
|
$
|
100.00
|
|
|
$
|
84.81
|
|
|
$
|
80.63
|
|
|
$
|
57.73
|
|
|
$
|
79.27
|
|
|
$
|
101.65
|
|
Standard & Poor's 500
|
100.00
|
|
|
101.39
|
|
|
113.52
|
|
|
138.30
|
|
|
132.24
|
|
|
173.88
|
|
||||||
Restaurant Index
|
100.00
|
|
|
121.05
|
|
|
129.76
|
|
|
160.98
|
|
|
178.90
|
|
|
225.11
|
|
|
Fiscal Year Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
|
|
|
|
(as adjusted) (a)
|
|
|
||||||||||||
Revenues:
|
(In millions, except per share amounts and restaurant data)
|
||||||||||||||||||
Royalties, franchise fees and other franchise revenues
|
$
|
368.2
|
|
|
$
|
375.6
|
|
|
$
|
360.2
|
|
|
$
|
377.9
|
|
|
$
|
386.6
|
|
Advertising revenue
|
283.0
|
|
|
268.3
|
|
|
234.2
|
|
|
260.1
|
|
|
108.1
|
|
|||||
Total franchise revenues
|
651.2
|
|
|
643.9
|
|
|
594.4
|
|
|
638.0
|
|
|
494.7
|
|
|||||
Rental and financing revenues
|
127.8
|
|
|
129.9
|
|
|
129.8
|
|
|
132.2
|
|
|
138.5
|
|
|||||
Company restaurant sales (b)
|
131.2
|
|
|
7.1
|
|
|
7.5
|
|
|
17.4
|
|
|
47.9
|
|
|||||
Total revenues
|
910.2
|
|
|
780.9
|
|
|
731.7
|
|
|
787.6
|
|
|
681.1
|
|
|||||
Cost of revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Advertising expenses
|
281.8
|
|
|
269.6
|
|
|
243.1
|
|
|
260.1
|
|
|
108.1
|
|
|||||
Other franchise expenses
|
31.0
|
|
|
61.0
|
|
|
50.9
|
|
|
33.4
|
|
|
30.9
|
|
|||||
Total franchise expenses
|
312.8
|
|
|
330.6
|
|
|
294.0
|
|
|
293.5
|
|
|
139.0
|
|
|||||
Rental and financing expenses
|
91.3
|
|
|
91.4
|
|
|
91.2
|
|
|
91.7
|
|
|
95.1
|
|
|||||
Company restaurant expenses (b)
|
123.3
|
|
|
5.9
|
|
|
7.8
|
|
|
18.2
|
|
|
48.0
|
|
|||||
Total cost of revenues
|
527.4
|
|
|
427.8
|
|
|
393.0
|
|
|
403.4
|
|
|
282.1
|
|
|||||
Gross profit
|
382.8
|
|
|
353.1
|
|
|
338.7
|
|
|
384.1
|
|
|
399.0
|
|
|||||
General and administrative expenses
|
162.8
|
|
|
166.7
|
|
|
165.7
|
|
|
148.9
|
|
|
155.4
|
|
|||||
Interest expense
|
60.4
|
|
|
61.7
|
|
|
62.0
|
|
|
61.5
|
|
|
63.3
|
|
|||||
Impairment of goodwill and intangible assets
|
—
|
|
|
—
|
|
|
531.6
|
|
|
—
|
|
|
—
|
|
|||||
Other expense, net (c)
|
21.1
|
|
|
14.1
|
|
|
7.7
|
|
|
15.9
|
|
|
11.7
|
|
|||||
Income (loss) before income taxes
|
138.4
|
|
|
110.6
|
|
|
(428.3
|
)
|
|
157.8
|
|
|
168.6
|
|
|||||
Income tax (provision) benefit
|
(34.1
|
)
|
|
(30.2
|
)
|
|
85.6
|
|
|
(56.8
|
)
|
|
(63.7
|
)
|
|||||
Net income (loss)
|
104.3
|
|
|
80.4
|
|
|
(342.8
|
)
|
|
101.0
|
|
|
104.9
|
|
|||||
Net income (loss) available to common stockholders
|
$
|
100.8
|
|
|
$
|
77.6
|
|
|
$
|
(336.0
|
)
|
|
$
|
99.6
|
|
|
$
|
103.5
|
|
Net income (loss) available to common stockholders per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
5.95
|
|
|
$
|
4.43
|
|
|
$
|
(18.96
|
)
|
|
$
|
5.52
|
|
|
$
|
5.55
|
|
Diluted
|
$
|
5.85
|
|
|
$
|
4.37
|
|
|
$
|
(18.96
|
)
|
|
$
|
5.49
|
|
|
$
|
5.52
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
16.9
|
|
|
17.5
|
|
|
17.7
|
|
|
18.0
|
|
|
18.6
|
|
|||||
Diluted
|
17.2
|
|
|
17.8
|
|
|
17.7
|
|
|
18.1
|
|
|
18.8
|
|
|||||
Dividends declared per common share
|
$
|
2.76
|
|
|
$
|
2.52
|
|
|
$
|
3.88
|
|
|
$
|
3.73
|
|
|
$
|
3.545
|
|
Dividends paid per common share
|
$
|
2.70
|
|
|
$
|
2.86
|
|
|
$
|
3.88
|
|
|
$
|
3.68
|
|
|
$
|
3.50
|
|
Balance Sheet Data (end of year):
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
116.0
|
|
|
$
|
137.2
|
|
|
$
|
117.0
|
|
|
$
|
140.5
|
|
|
$
|
144.8
|
|
Property and equipment, net
|
216.4
|
|
|
240.3
|
|
|
199.6
|
|
|
205.1
|
|
|
219.6
|
|
|||||
Total assets (d)
|
2,049.5
|
|
|
1,774.7
|
|
|
1,735.6
|
|
|
2,278.6
|
|
|
2,331.9
|
|
|||||
Long-term debt, less current maturities
|
1,288.2
|
|
|
1,274.1
|
|
|
1,269.8
|
|
|
1,282.7
|
|
|
1,279.5
|
|
|||||
Operating lease, finance lease, financing obligations, less current maturities (d)
|
474.1
|
|
|
126.2
|
|
|
101.1
|
|
|
114.2
|
|
|
127.2
|
|
|||||
Stockholders' (deficit) equity
|
(241.8
|
)
|
|
(202.3
|
)
|
|
(215.5
|
)
|
|
252.8
|
|
|
267.2
|
|
|||||
Other Financial Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows provided by operating activities
|
$
|
155.2
|
|
|
$
|
140.3
|
|
|
$
|
65.7
|
|
|
$
|
118.1
|
|
|
$
|
135.5
|
|
Capital expenditures
|
19.4
|
|
|
14.3
|
|
|
13.4
|
|
|
5.6
|
|
|
6.6
|
|
|||||
Domestic system-wide same-restaurant sales percentage change:
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee's
|
(0.7
|
)%
|
|
5.0
|
%
|
|
(5.3
|
)%
|
|
(5.0
|
)%
|
|
0.2
|
%
|
|||||
IHOP
|
1.1
|
%
|
|
1.5
|
%
|
|
(1.9
|
)%
|
|
(0.1
|
)%
|
|
4.5
|
%
|
|||||
Total restaurants (end of year):
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee's
|
1,787
|
|
|
1,837
|
|
|
1,936
|
|
|
2,016
|
|
|
2,033
|
|
|||||
IHOP
|
1,841
|
|
|
1,831
|
|
|
1,786
|
|
|
1,733
|
|
|
1,683
|
|
|||||
Total restaurants
|
3,628
|
|
|
3,668
|
|
|
3,722
|
|
|
3,749
|
|
|
3,716
|
|
(a)
|
We adopted a new revenue recognition standard on January 1, 2018 that was applied retrospectively to 2017 and 2016; financial information for 2015 has not been adjusted to reflect the new standard.
|
(b)
|
We acquired 69 Applebee's franchise restaurants in December 2018. We refranchised nine IHOP company-operated restaurants in June 2017 and 23 Applebee's company-operated restaurants in July 2015.
|
(c)
|
Includes amortization of intangible assets, closure and other impairment charges and gain/loss on disposition of assets in each year as well as loss on extinguishment of debt of $8.3 million in 2019 and $2.5 million of debt refinancing costs in 2018.
|
(d)
|
We adopted a new lease accounting standard on January 1, 2019 that resulted in balance sheet recognition of operating lease liabilities and right-of-use assets (See Note 2 of Notes to Consolidated Financial Statements). Financial information for years before 2019 has not been adjusted to reflect the new standard.
|
•
|
We reported net income of $104.3 million, or $5.85 per diluted share, in 2019, compared to net income of $80.4 million, or $4.37 per diluted share, in 2018;
|
•
|
We refinanced $1.3 billion of 4.277% fixed rate senior secured notes, effectively due in 2021, with two tranches of new notes: $700 million of 4.194% fixed rate senior secured notes, effectively due in 2024 and $600 million of 4.723% fixed rate senior secured notes, effectively due in 2026;
|
•
|
We generated cash from operating activities of $155.2 million and adjusted free cash flow (cash provided by operating activities, plus receipts from notes and equipment contract receivables, less additions to property and equipment) of $148.8 million in 2019;
|
•
|
We returned over $156 million to our stockholders, comprised of $109.7 million in the form of stock repurchases and $46.9 million in cash dividends, with cash dividends reflecting a 10% increase in our quarterly dividend to $0.69 per share, effective with the dividend declared in the first quarter 2019. The 1.3 million shares repurchased in 2019 represented nearly 8% of total shares outstanding at the end of 2018.
|
•
|
We signed the largest multi-unit development agreement in IHOP's history, calling for the development, with TravelCenters of America, of nearly 100 IHOP restaurants over the next five years; and
|
•
|
IHOP franchisees remodeled 208 domestic restaurants in 2019 under our new Rise ‘N’ Shine design. Over 1,100 IHOP restaurants have been remodeled since the Rise ‘N’ Shine design was announced in late 2015.
|
|
Applebee's
|
|
IHOP
|
||
System-wide sales percentage (decrease) increase
|
(3.0
|
)%
|
|
2.2
|
%
|
Domestic system-wide same-restaurant sales percentage (decrease) increase
|
(0.7
|
)%
|
|
1.1
|
%
|
Net franchise restaurant (reduction) development (1)
|
(50
|
)
|
|
10
|
|
Net (decrease) increase in total effective restaurants (2)
|
(72
|
)
|
|
25
|
|
Financial Summary
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||
|
|
2019
|
|
|
2018
|
|||||||
|
|
(In millions, except per share amounts)
|
||||||||||
Income before income taxes
|
|
$
|
138.4
|
|
|
$
|
27.8
|
|
|
$
|
110.6
|
|
Income tax provision
|
|
(34.1
|
)
|
|
(3.9
|
)
|
|
(30.2
|
)
|
|||
Net income
|
|
$
|
104.3
|
|
|
$
|
23.9
|
|
|
$
|
80.4
|
|
|
|
|
|
Variance
|
|
|
||||||
Effective tax rate
|
|
24.6
|
%
|
|
2.8
|
%
|
|
27.4
|
%
|
|||
Net income per diluted share
|
|
$
|
5.85
|
|
|
$
|
1.48
|
|
|
$
|
4.37
|
|
Weighted average diluted shares outstanding
|
|
17.2
|
|
|
(0.6
|
)
|
|
17.8
|
|
Applebee's Restaurant Data
|
|
|
|
|
|
||||||
|
Year Ended December 31,
|
||||||||||
Global Effective Restaurants:(a)
|
2019
|
|
2018
|
|
2017
|
||||||
Franchise
|
1,745
|
|
|
1,883
|
|
|
1,970
|
|
|||
Company
|
69
|
|
|
3
|
|
|
—
|
|
|||
Total
|
1,814
|
|
|
1,886
|
|
|
1,970
|
|
|||
System-wide:(b)
|
|
|
|
|
|
||||||
Domestic sales percentage change(c)
|
(3.0
|
)%
|
|
2.3
|
%
|
|
(6.8
|
)%
|
|||
Domestic same-restaurant sales percentage change(d)
|
(0.7
|
)%
|
|
5.0
|
%
|
|
(5.3
|
)%
|
|||
Franchise:(b)
|
|
|
|
|
|
||||||
Domestic sales percentage change(c) (e)
|
(5.9
|
)%
|
|
2.1
|
%
|
|
(6.8
|
)%
|
|||
Domestic same-restaurant sales percentage change(d)
|
(0.7
|
)%
|
|
4.9
|
%
|
|
(5.3
|
)%
|
|||
Domestic average weekly unit sales (in thousands)
|
$
|
47.3
|
|
|
$
|
46.7
|
|
|
$
|
43.6
|
|
IHOP Restaurant Data
|
|
|
|
|
|
||||||
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Global Effective Restaurants:(a)
|
|
|
|
|
|
||||||
Franchise
|
1,663
|
|
|
1,633
|
|
|
1,576
|
|
|||
Area license
|
157
|
|
|
162
|
|
|
164
|
|
|||
Company
|
—
|
|
|
—
|
|
|
5
|
|
|||
Total
|
1,820
|
|
|
1,795
|
|
|
1,745
|
|
|||
System-wide:(b)
|
|
|
|
|
|
||||||
Sales percentage change(c)
|
2.2
|
%
|
|
3.9
|
%
|
|
0.7
|
%
|
|||
Domestic same-restaurant sales percentage change(d) (f)
|
1.1
|
%
|
|
1.5
|
%
|
|
(1.9
|
)%
|
|||
Franchise:(b)
|
|
|
|
|
|
||||||
Sales percentage change(c)
|
2.2
|
%
|
|
4.4
|
%
|
|
1.2
|
%
|
|||
Domestic same-restaurant sales percentage change(d)
|
1.0
|
%
|
|
1.5
|
%
|
|
(1.9
|
)%
|
|||
Average weekly unit sales (in thousands)
|
$
|
36.7
|
|
|
$
|
36.6
|
|
|
$
|
36.3
|
|
Area License:(b)
|
|
|
|
|
|
||||||
IHOP sales percentage change(c)
|
2.7
|
%
|
|
0.5
|
%
|
|
(0.7
|
)%
|
(a)
|
“Global Effective Restaurants” are the weighted average number of restaurants open in a given fiscal period, adjusted to account for restaurants open for only a portion of the period. Information is presented for all Effective Restaurants in the Applebee’s and IHOP systems, domestic and international, which includes restaurants owned by franchisees and area licensees as well as those owned by the Company.
|
(b)
|
“System-wide sales” are retail sales at Applebee’s restaurants operated by franchisees and IHOP restaurants operated by franchisees and area licensees, as reported to the Company, in addition to retail sales at company-operated restaurants. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. An increase or decrease in franchisees' reported sales will result in a corresponding increase or decrease in our royalty revenue. Unaudited reported sales for Applebee's domestic franchise restaurants, IHOP franchise restaurants and IHOP area license restaurants for the years ended December 31, 2019, December 31, 2018 and December 31, 2017 and sales at company-operated restaurants were as follows:
|
|
Year Ended December 31,
|
||||||||||
Reported sales
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In millions)
|
||||||||||
Applebee's domestic franchise restaurant sales
|
$
|
3,954.3
|
|
|
$
|
4,204.1
|
|
|
$
|
4,117.1
|
|
Applebee's company-operated restaurants
|
131.2
|
|
|
7.1
|
|
|
—
|
|
|||
IHOP franchise restaurant sales
|
3,174.2
|
|
|
3,106.7
|
|
|
2,974.6
|
|
|||
IHOP area license restaurant sales
|
289.5
|
|
|
282.0
|
|
|
280.6
|
|
|||
IHOP company-operated restaurants
|
—
|
|
|
—
|
|
|
7.5
|
|
|||
Total
|
$
|
7,549.2
|
|
|
$
|
7,599.9
|
|
|
$
|
7,379.8
|
|
(c)
|
“Sales percentage change” reflects, for each category of restaurants, the percentage change in sales in any given fiscal year compared to the prior fiscal year for all restaurants in that category.
|
(d)
|
“Domestic same-restaurant sales change” reflects the percentage change in sales in any given fiscal year, compared to the same weeks in the prior year, for domestic restaurants that have been operated throughout both fiscal years that are being compared and have been open for at least 18 months. Because of new restaurant openings and restaurant closures, the domestic restaurants open throughout the fiscal years being compared may be different from year to year. Domestic same-restaurant sales percentage change does not include data on IHOP area license restaurants for 2018 and 2017.
|
(e)
|
The franchise sales percentage change for 2019 was impacted by the acquisition of 69 franchise restaurants in December 2018 now reported as company-operated.
|
(f)
|
IHOP same-restaurant sales data includes area license restaurants beginning in 2019
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Applebee's Restaurant Development Activity
|
|
|
|
|
|
|||
|
|
|
|
|
|
|||
Summary - beginning of period:
|
|
|
|
|
|
|||
Franchise
|
1,768
|
|
|
1,936
|
|
|
2,016
|
|
Company restaurants (a)
|
69
|
|
|
—
|
|
|
—
|
|
Total Applebee's restaurants, beginning of period
|
1,837
|
|
|
1,936
|
|
|
2,016
|
|
Domestic
|
1,693
|
|
|
1,782
|
|
|
1,858
|
|
International
|
144
|
|
|
154
|
|
|
158
|
|
|
|
|
|
|
|
|||
Franchise restaurants opened:
|
|
|
|
|
|
|||
Domestic
|
1
|
|
|
2
|
|
|
10
|
|
International
|
2
|
|
|
5
|
|
|
9
|
|
Total franchise restaurants opened
|
3
|
|
|
7
|
|
|
19
|
|
Franchise restaurants closed:
|
|
|
|
|
|
|||
Domestic
|
(29
|
)
|
|
(91
|
)
|
|
(86
|
)
|
International
|
(24
|
)
|
|
(15
|
)
|
|
(13
|
)
|
Total franchise restaurants closed
|
(53
|
)
|
|
(106
|
)
|
|
(99
|
)
|
Net franchise restaurant reduction
|
(50
|
)
|
|
(99
|
)
|
|
(80
|
)
|
Franchise restaurants acquired by the Company
|
—
|
|
|
(69
|
)
|
|
—
|
|
Net franchise restaurant decrease
|
(50
|
)
|
|
(168
|
)
|
|
(80
|
)
|
|
|
|
|
|
|
|||
Summary - end of period:
|
|
|
|
|
|
|||
Franchise
|
1,718
|
|
|
1,768
|
|
|
1,936
|
|
Company restaurants (a)
|
69
|
|
|
69
|
|
|
—
|
|
Total Applebee's restaurants, end of period
|
1,787
|
|
|
1,837
|
|
|
1,936
|
|
Domestic
|
1,665
|
|
|
1,693
|
|
|
1,782
|
|
International
|
122
|
|
|
144
|
|
|
154
|
|
% Decrease in total Applebee's restaurants from prior year
|
(2.7
|
)%
|
|
(5.1
|
)%
|
|
(4.0
|
)%
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
IHOP Restaurant Development Activity
|
|
|
|
|
|
|||
|
|
|
|
|
|
|||
Summary - beginning of period:
|
|
|
|
|
|
|||
Franchise
|
1,669
|
|
|
1,622
|
|
|
1,556
|
|
Area license
|
162
|
|
|
164
|
|
|
167
|
|
Company(a)
|
—
|
|
|
—
|
|
|
10
|
|
Total IHOP restaurants, beginning of period
|
1,831
|
|
|
1,786
|
|
|
1,733
|
|
Domestic
|
1,705
|
|
|
1,671
|
|
|
1,637
|
|
International
|
126
|
|
|
115
|
|
|
96
|
|
|
|
|
|
|
|
|||
Franchise/area license restaurants opened:
|
|
|
|
|
|
|||
Domestic franchise
|
33
|
|
|
51
|
|
|
48
|
|
Domestic area license
|
5
|
|
|
3
|
|
|
1
|
|
International franchise
|
13
|
|
|
17
|
|
|
28
|
|
Total franchise/area license restaurants opened
|
51
|
|
|
71
|
|
|
77
|
|
Franchise/area license restaurants closed:
|
|
|
|
|
|
|||
Domestic franchise
|
(27
|
)
|
|
(15
|
)
|
|
(11
|
)
|
Domestic area license
|
(6
|
)
|
|
(5
|
)
|
|
(3
|
)
|
International franchise
|
(8
|
)
|
|
(6
|
)
|
|
(8
|
)
|
International area license
|
—
|
|
|
—
|
|
|
(1
|
)
|
Total franchise/area license restaurants closed
|
(41
|
)
|
|
(26
|
)
|
|
(23
|
)
|
Net franchise/area license restaurant development
|
10
|
|
|
45
|
|
|
54
|
|
Refranchised from Company restaurants
|
—
|
|
|
1
|
|
|
9
|
|
Franchise restaurants reacquired by the Company
|
—
|
|
|
(1
|
)
|
|
—
|
|
Net franchise/area license restaurant additions
|
10
|
|
|
45
|
|
|
63
|
|
|
|
|
|
|
|
|||
Summary - end of period:
|
|
|
|
|
|
|||
Franchise
|
1,680
|
|
|
1,669
|
|
|
1,622
|
|
Area license
|
161
|
|
|
162
|
|
|
164
|
|
Company(a)
|
—
|
|
|
—
|
|
|
—
|
|
Total IHOP restaurants, end of period
|
1,841
|
|
|
1,831
|
|
|
1,786
|
|
Domestic
|
1,710
|
|
|
1,705
|
|
|
1,671
|
|
International
|
131
|
|
|
126
|
|
|
115
|
|
% Increase in total IHOP restaurants from prior year
|
0.5
|
%
|
|
2.5
|
%
|
|
3.1
|
%
|
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
Revenue
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Franchise operations
|
|
$
|
651.2
|
|
|
$
|
7.3
|
|
|
$
|
643.9
|
|
|
$
|
49.5
|
|
|
$
|
594.4
|
|
Company restaurant operations
|
|
131.2
|
|
|
124.1
|
|
|
7.1
|
|
|
(0.4
|
)
|
|
7.5
|
|
|||||
Rental operations
|
|
120.7
|
|
|
(1.2
|
)
|
|
121.9
|
|
|
0.5
|
|
|
121.4
|
|
|||||
Financing operations
|
|
7.1
|
|
|
(0.9
|
)
|
|
8.0
|
|
|
(0.4
|
)
|
|
8.4
|
|
|||||
Total revenue
|
|
$
|
910.2
|
|
|
$
|
129.3
|
|
|
$
|
780.9
|
|
|
$
|
49.2
|
|
|
$
|
731.7
|
|
Change vs. prior year
|
|
16.6
|
%
|
|
|
|
6.7
|
%
|
|
|
|
14.2
|
%
|
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
Gross Profit (Loss)
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Franchise operations
|
|
$
|
338.4
|
|
|
$
|
25.1
|
|
|
$
|
313.3
|
|
|
$
|
12.9
|
|
|
$
|
300.4
|
|
Company restaurant operations
|
|
8.0
|
|
|
6.8
|
|
|
1.2
|
|
|
1.5
|
|
|
(0.3
|
)
|
|||||
Rental operations
|
|
29.9
|
|
|
(1.3
|
)
|
|
31.2
|
|
|
0.4
|
|
|
30.8
|
|
|||||
Financing operations
|
|
6.5
|
|
|
(0.9
|
)
|
|
7.4
|
|
|
(0.4
|
)
|
|
7.8
|
|
|||||
Total gross profit
|
|
$
|
382.8
|
|
|
$
|
29.7
|
|
|
$
|
353.1
|
|
|
$
|
14.4
|
|
|
$
|
338.7
|
|
Change vs. prior year
|
|
8.4
|
%
|
|
|
|
4.2
|
%
|
|
|
|
(11.8
|
)%
|
Franchise Operations
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions, except number of restaurants)
|
||||||||||||||||||
Effective Franchise Restaurants:(1)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee’s
|
|
1,745
|
|
(138)
|
|
1,883
|
|
(87)
|
|
1,970
|
||||||||||
IHOP
|
|
1,820
|
|
25
|
|
1,795
|
|
55
|
|
1,740
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Franchise Revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee's
|
|
$
|
163.6
|
|
|
$
|
(13.0
|
)
|
|
$
|
176.6
|
|
|
$
|
7.8
|
|
|
$
|
168.8
|
|
IHOP
|
|
204.6
|
|
|
5.6
|
|
|
199.0
|
|
|
7.6
|
|
|
191.4
|
|
|||||
Advertising
|
|
283.0
|
|
|
14.7
|
|
|
268.3
|
|
|
34.1
|
|
|
234.2
|
|
|||||
Total franchise revenues
|
|
651.2
|
|
|
7.3
|
|
|
643.9
|
|
|
49.5
|
|
|
594.4
|
|
|||||
Franchise Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee’s
|
|
4.3
|
|
|
30.8
|
|
|
35.1
|
|
|
(7.4
|
)
|
|
27.7
|
|
|||||
IHOP
|
|
26.7
|
|
|
(0.8
|
)
|
|
25.9
|
|
|
(2.7
|
)
|
|
23.2
|
|
|||||
Advertising
|
|
281.8
|
|
|
(12.2
|
)
|
|
269.6
|
|
|
(26.5
|
)
|
|
243.1
|
|
|||||
Total franchise expenses
|
|
312.8
|
|
|
17.8
|
|
|
330.6
|
|
|
(36.6
|
)
|
|
294.0
|
|
|||||
Franchise Segment Profit:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee’s
|
|
159.3
|
|
|
17.8
|
|
|
141.5
|
|
|
0.4
|
|
|
141.1
|
|
|||||
IHOP
|
|
177.9
|
|
|
4.8
|
|
|
173.1
|
|
|
4.9
|
|
|
168.2
|
|
|||||
Advertising
|
|
1.2
|
|
|
2.5
|
|
|
(1.3
|
)
|
|
7.6
|
|
|
(8.9
|
)
|
|||||
Total franchise segment profit
|
|
$
|
338.4
|
|
|
$
|
25.1
|
|
|
$
|
313.3
|
|
|
$
|
12.9
|
|
|
$
|
300.4
|
|
Gross profit as % of total revenue
|
|
52.0
|
%
|
|
|
|
48.7
|
%
|
|
|
|
50.5
|
%
|
|||||||
Gross profit as % of franchise fees (2)
|
|
91.6
|
%
|
|
|
|
83.8
|
%
|
|
|
|
85.9
|
%
|
•
|
Applebee's franchise revenue decreased $13.0 million compared to 2018. Revenue declined approximately $8.7 million due to 138 fewer effective franchise restaurants in operation during the year, the number of which declined due to restaurant closures by franchisees and to our acquisition of 69 Applebee's restaurants as noted above. A decrease in revenue recognized upon cash collection reduced franchise revenue by $1.2 million. Revenue that had been recognized in 2018 upon cash collection, primarily of past-due amounts, did not recur to the same degree in 2019 as franchisee health improved. A decrease of 0.7% in domestic franchise same-restaurant sales reduced franchise revenue by $1.0 million. Lower franchise fees, credits against royalties for delivery charges and a decrease in international royalty revenue also contributed to the decline in Applebee's franchise revenue.
|
•
|
IHOP franchise revenues increased $5.6 million, or 2.8%, primarily due to the impact on royalty and dry mix revenues of a 1.4% increase in effective franchise restaurants due to franchisee development and a 1.1% increase in domestic same-restaurant sales.
|
•
|
Advertising revenue increased $14.7 million compared to 2018, as discussed by brand below.
|
•
|
Applebee's franchise expenses decreased $30.8 million, primarily due to the absence of franchisor marketing contributions in 2019. We contributed $30.0 million to the Applebee's NAF during the year ended December 31, 2018. Our contributions ceased as of June 30, 2018 and we made no such contributions to the Applebee's NAF during the year ended December 31, 2019.
|
•
|
IHOP franchise expenses increased $0.8 million, primarily due to contributions for menu management programs, partially offset by lower bad debt expense.
|
•
|
Advertising expenses increased $12.2 million, due to a corresponding increase in advertising revenue, partially offset by the recovery in 2019 of a $1.3 million advertising deficit that had been recorded in 2018, as discussed below.
|
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Advertising Revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee's
|
|
$
|
165.5
|
|
|
$
|
12.5
|
|
|
$
|
153.0
|
|
|
$
|
30.8
|
|
|
122.2
|
|
|
IHOP
|
|
117.5
|
|
|
2.2
|
|
|
115.3
|
|
|
3.3
|
|
|
112.0
|
|
|||||
Total advertising revenues
|
|
$
|
283.0
|
|
|
14.7
|
|
|
$
|
268.3
|
|
|
34.1
|
|
|
$
|
234.2
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Advertising Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee’s
|
|
$
|
165.6
|
|
|
$
|
(12.6
|
)
|
|
$
|
153.0
|
|
|
$
|
(21.9
|
)
|
|
$
|
131.1
|
|
IHOP
|
|
116.2
|
|
|
0.4
|
|
|
116.6
|
|
|
(4.6
|
)
|
|
112.0
|
|
|||||
Total advertising expenses
|
|
$
|
281.8
|
|
|
$
|
(12.2
|
)
|
|
$
|
269.6
|
|
|
$
|
(26.5
|
)
|
|
$
|
243.1
|
|
Rental Operations
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Rental revenues
|
|
$
|
120.7
|
|
|
$
|
(1.2
|
)
|
|
$
|
121.9
|
|
|
$
|
0.5
|
|
|
$
|
121.4
|
|
Rental expenses
|
|
90.8
|
|
|
(0.1
|
)
|
|
90.7
|
|
|
(0.1
|
)
|
|
90.6
|
|
|||||
Rental operations segment profit
|
|
$
|
29.9
|
|
|
$
|
(1.3
|
)
|
|
$
|
31.2
|
|
|
$
|
0.4
|
|
|
$
|
30.8
|
|
Gross profit as % of revenue
|
|
24.8
|
%
|
|
|
|
25.6
|
%
|
|
|
|
25.4
|
%
|
Financing Operations
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Financing revenues
|
|
$
|
7.1
|
|
|
$
|
(0.9
|
)
|
|
$
|
8.0
|
|
|
$
|
(0.4
|
)
|
|
$
|
8.4
|
|
Financing expenses
|
|
0.6
|
|
|
0.0
|
|
|
0.6
|
|
|
0.0
|
|
|
0.6
|
|
|||||
Financing operations segment profit
|
|
$
|
6.5
|
|
|
$
|
(0.9
|
)
|
|
$
|
7.4
|
|
|
$
|
(0.4
|
)
|
|
$
|
7.8
|
|
Gross profit as % of revenue
|
|
91.9
|
%
|
|
|
|
92.5
|
%
|
|
|
|
92.8
|
%
|
Company Operations
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions, except number of restaurants)
|
||||||||||||||||||
Effective Company Restaurants:(1)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Applebee’s
|
|
69
|
|
|
66
|
|
|
3
|
|
|
3
|
|
|
—
|
|
|||||
IHOP
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
5
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Company restaurant sales
|
|
$
|
131.2
|
|
|
$
|
124.1
|
|
|
$
|
7.1
|
|
|
$
|
(0.4
|
)
|
|
$
|
7.5
|
|
Company restaurant expenses
|
|
123.2
|
|
|
(117.3
|
)
|
|
5.9
|
|
|
1.9
|
|
|
7.8
|
|
|||||
Company restaurant segment profit (loss)
|
|
$
|
8.0
|
|
|
$
|
6.8
|
|
|
$
|
1.2
|
|
|
$
|
1.5
|
|
|
$
|
(0.3
|
)
|
Gross profit (loss) as % of revenue
|
|
6.1
|
%
|
|
|
|
17.1
|
%
|
|
|
|
(3.6
|
)%
|
General and Administrative Expenses
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
|
|
$
|
162.8
|
|
|
$
|
3.9
|
|
|
$
|
166.7
|
|
|
$
|
(1.0
|
)
|
|
$
|
165.7
|
|
Impairment of Goodwill and Intangible Assets
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Impairment of goodwill
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
358.2
|
|
|
$
|
358.2
|
|
Impairment of tradename
|
|
—
|
|
|
—
|
|
|
—
|
|
|
173.4
|
|
|
173.4
|
|
|||||
Total
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
531.6
|
|
|
$
|
531.6
|
|
Other Income and Expense Items
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Interest expense, net
|
|
$
|
60.4
|
|
|
$
|
1.3
|
|
|
$
|
61.7
|
|
|
$
|
0.3
|
|
|
$
|
62.0
|
|
Amortization of intangible assets
|
|
11.7
|
|
|
(1.6
|
)
|
|
10.1
|
|
|
(0.1
|
)
|
|
10.0
|
|
|||||
Closure and other impairment charges
|
|
1.5
|
|
|
0.6
|
|
|
2.1
|
|
|
1.9
|
|
|
4.0
|
|
|||||
Gain on disposition of assets
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
(0.6
|
)
|
|
(5.7
|
)
|
|
(6.3
|
)
|
|||||
Total
|
|
$
|
73.3
|
|
|
$
|
0.0
|
|
|
$
|
73.3
|
|
|
$
|
(3.6
|
)
|
|
$
|
69.7
|
|
Closure and Other Impairment Charges
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Closure charges
|
|
$
|
1.5
|
|
|
$
|
0.5
|
|
|
$
|
2.0
|
|
|
1.9
|
|
|
$
|
3.9
|
|
|
Long-lived tangible asset impairments
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||||
Total closure and impairment charges
|
|
$
|
1.5
|
|
|
$
|
0.6
|
|
|
$
|
2.1
|
|
|
$
|
1.9
|
|
|
$
|
4.0
|
|
Income Tax Benefit (Provision)
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Income tax (provision) benefit
|
|
$
|
(34.1
|
)
|
|
$
|
(3.9
|
)
|
|
$
|
(30.2
|
)
|
|
$
|
(115.8
|
)
|
|
$
|
85.6
|
|
Effective tax rate
|
|
24.6
|
%
|
|
2.8
|
%
|
|
27.4
|
%
|
|
(7.4
|
)%
|
|
20.0
|
%
|
Cash Flows
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||
Net cash provided by operating activities
|
|
$
|
155.2
|
|
|
$
|
14.9
|
|
|
$
|
140.3
|
|
|
$
|
74.6
|
|
|
$
|
65.7
|
|
Net cash (used in) provided by investing activities
|
|
(0.2
|
)
|
|
14.6
|
|
|
(14.8
|
)
|
|
(22.5
|
)
|
|
7.7
|
|
|||||
Net cash used in financing activities
|
|
(182.9
|
)
|
|
(94.6
|
)
|
|
(88.3
|
)
|
|
7.5
|
|
|
(95.8
|
)
|
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
|
$
|
(27.9
|
)
|
|
$
|
(65.1
|
)
|
|
$
|
37.2
|
|
|
$
|
59.6
|
|
|
$
|
(22.4
|
)
|
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||
|
|
2019
|
|
|
2018
|
|||||||
|
|
(In millions)
|
||||||||||
Net income
|
|
$
|
104.3
|
|
|
$
|
23.9
|
|
|
$
|
80.4
|
|
Non-cash reconciling items
|
|
47.6
|
|
|
18.1
|
|
|
29.5
|
|
|||
Changes in working capital
|
|
3.3
|
|
|
(27.1
|
)
|
|
30.4
|
|
|||
Cash provided by operating activities
|
|
$
|
155.2
|
|
|
$
|
14.9
|
|
|
$
|
140.3
|
|
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||
|
|
2019
|
|
|
2018
|
|||||||
|
|
(In millions)
|
||||||||||
Principal receipts from notes, equipment contracts and other long-term receivables
|
|
$
|
24.1
|
|
|
$
|
(1.7
|
)
|
|
$
|
25.8
|
|
Additions to property and equipment
|
|
(19.4
|
)
|
|
(5.1
|
)
|
|
(14.3
|
)
|
|||
Acquisition of business
|
|
—
|
|
|
20.2
|
|
|
(20.2
|
)
|
|||
Additions to long-term receivables
|
|
(7.0
|
)
|
|
(0.5
|
)
|
|
(6.5
|
)
|
|||
Other
|
|
2.2
|
|
|
1.8
|
|
|
0.4
|
|
|||
Cash provided by operating activities
|
|
$
|
(0.2
|
)
|
|
$
|
14.6
|
|
|
$
|
(14.8
|
)
|
|
Principal Receipts Due By Period
|
||||||||||||||||||||||||||
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
Thereafter
|
|
Total
|
||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||
Equipment leases(1)
|
$
|
9.0
|
|
|
$
|
8.7
|
|
|
$
|
8.5
|
|
|
$
|
7.9
|
|
|
$
|
7.2
|
|
|
$
|
15.0
|
|
|
$
|
56.3
|
|
Direct financing leases(2)
|
11.0
|
|
|
9.4
|
|
|
7.2
|
|
|
3.2
|
|
|
1.1
|
|
|
2.1
|
|
|
34.0
|
|
|||||||
Other notes(3)
|
4.6
|
|
|
4.1
|
|
|
7.8
|
|
|
3.8
|
|
|
3.7
|
|
|
4.2
|
|
|
28.2
|
|
|||||||
Total
|
$
|
24.6
|
|
|
$
|
22.2
|
|
|
$
|
23.5
|
|
|
$
|
14.9
|
|
|
$
|
12.0
|
|
|
$
|
21.3
|
|
|
$
|
118.5
|
|
(1)
|
Equipment lease receivables extend through the year 2029.
|
(2)
|
Direct financing lease receivables extend through the year 2038.
|
(3)
|
Other notes receivable extend through the year 2024.
|
|
|
|
|
(Increase) decrease in cash used
|
|
|
||||||
|
|
2019
|
|
|
2018
|
|||||||
|
|
(In millions)
|
||||||||||
Repurchase of common stock
|
|
$
|
(109.7
|
)
|
|
$
|
(76.1
|
)
|
|
$
|
(33.6
|
)
|
Dividends paid
|
|
(46.9
|
)
|
|
4.2
|
|
|
(51.1
|
)
|
|||
Net issuance (payments) of long-term debt, including issuance costs
|
|
3.1
|
|
|
19.7
|
|
|
(16.6
|
)
|
|||
Net (payment) borrowing of revolving credit
|
|
(25.0
|
)
|
|
(50.0
|
)
|
|
25.0
|
|
|||
All other
|
|
(4.4
|
)
|
|
7.6
|
|
|
(12.0
|
)
|
|||
Cash used in financing activities
|
|
$
|
(182.9
|
)
|
|
$
|
(94.6
|
)
|
|
$
|
(88.3
|
)
|
|
|
|
Favorable
(Unfavorable) Variance |
|
|
|
Favorable
(Unfavorable) Variance |
|
|
||||||||||
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||||||
|
(In millions)
|
||||||||||||||||||
Cash flows provided by operating activities
|
$
|
155.2
|
|
|
$
|
14.9
|
|
|
$
|
140.3
|
|
|
$
|
74.6
|
|
|
$
|
65.7
|
|
Net receipts from notes and equipment receivables
|
13.0
|
|
|
(1.9
|
)
|
|
14.9
|
|
|
4.3
|
|
|
10.6
|
|
|||||
Additions to property and equipment
|
(19.4
|
)
|
|
(5.1
|
)
|
|
(14.3
|
)
|
|
(1.0
|
)
|
|
(13.3
|
)
|
|||||
Adjusted free cash flow
|
$
|
148.8
|
|
|
$
|
7.9
|
|
|
$
|
140.9
|
|
|
$
|
77.9
|
|
|
$
|
63.0
|
|
|
Shares
|
|
Cost of shares
|
|||
|
|
|
(In millions)
|
|||
2019 Repurchase Program:
|
|
|
|
|||
Repurchased during the year ended December 31, 2019
|
1,237,698
|
|
|
$
|
103.3
|
|
Cumulative (life-of-program) repurchases
|
1,237,698
|
|
|
$
|
103.3
|
|
Remaining dollar value of shares that may be repurchased
|
n/a
|
|
$
|
96.7
|
|
|
|
|
|
|
|||
2015 Repurchase Program:
|
|
|
|
|||
Repurchased during the year ended December 31, 2019
|
110,499
|
|
|
$
|
8.4
|
|
Cumulative (life-of-program) repurchases
|
1,589,995
|
|
|
$
|
126.2
|
|
Remaining dollar value of shares that may be repurchased
|
n/a
|
|
n/a
|
|
Payments Due By Period
|
||||||||||||||||||
Contractual Obligations
|
1 Year
|
|
2 - 3 Years
|
|
4 - 5 Years
|
|
More than
5 Years
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Debt(1)
|
$
|
57.7
|
|
|
$
|
115.4
|
|
|
$
|
800.7
|
|
|
$
|
628.3
|
|
|
$
|
1,602.1
|
|
Operating leases(2)
|
97.4
|
|
|
154.4
|
|
|
115.6
|
|
|
173.0
|
|
|
540.4
|
|
|||||
Finance leases(1)
|
19.9
|
|
|
31.1
|
|
|
20.9
|
|
|
55.7
|
|
|
127.6
|
|
|||||
Financing obligations(1)
|
5.6
|
|
|
10.3
|
|
|
10.6
|
|
|
44.8
|
|
|
71.3
|
|
|||||
Purchase commitments
|
103.6
|
|
|
12.3
|
|
|
—
|
|
|
—
|
|
|
115.9
|
|
|||||
Unrecognized income tax benefits(3)
|
1.5
|
|
|
—
|
|
|
—
|
|
|
6.1
|
|
|
7.6
|
|
|||||
Total minimum payments
|
285.7
|
|
|
323.5
|
|
|
947.8
|
|
|
907.9
|
|
|
2,464.9
|
|
|||||
Less interest
|
(94.0
|
)
|
|
(167.9
|
)
|
|
(135.4
|
)
|
|
(83.4
|
)
|
|
(480.7
|
)
|
|||||
Total
|
$
|
191.7
|
|
|
$
|
155.6
|
|
|
$
|
812.4
|
|
|
$
|
824.5
|
|
|
$
|
1,984.2
|
|
|
Expiration By Period
|
||||||||||||||||||
Commitments
|
1 Year
|
|
2 - 3 Years
|
|
4 - 5 Years
|
|
More than
5 Years
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Lease guarantees(4)
|
$
|
15.5
|
|
|
$
|
29.7
|
|
|
$
|
26.9
|
|
|
$
|
185.1
|
|
|
$
|
257.2
|
|
Letters of credit(5)
|
2.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.8
|
|
|||||
Food purchases(6)
|
2.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.6
|
|
|||||
Total
|
$
|
20.9
|
|
|
$
|
29.7
|
|
|
$
|
26.9
|
|
|
$
|
185.1
|
|
|
$
|
262.6
|
|
|
Page
Reference
|
Dine Brands Global, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income (Loss)
(In thousands, except per share amounts)
|
|||||||||||
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues:
|
|
|
|
||||||||
Franchise revenues:
|
|
|
|
|
|
||||||
Royalties, franchise fees and other
|
$
|
368,171
|
|
|
$
|
375,640
|
|
|
$
|
360,253
|
|
Advertising revenue
|
283,015
|
|
|
268,294
|
|
|
234,165
|
|
|||
Total franchise revenues
|
651,186
|
|
|
643,934
|
|
|
594,418
|
|
|||
Company restaurant sales
|
131,214
|
|
|
7,084
|
|
|
7,518
|
|
|||
Rental revenues
|
120,666
|
|
|
121,934
|
|
|
121,437
|
|
|||
Financing revenues
|
7,112
|
|
|
7,979
|
|
|
8,352
|
|
|||
Total revenues
|
910,178
|
|
|
780,931
|
|
|
731,725
|
|
|||
Cost of revenues:
|
|
|
|
|
|
||||||
Franchise expenses:
|
|
|
|
|
|
||||||
Advertising expenses
|
281,781
|
|
|
269,590
|
|
|
243,096
|
|
|||
Other franchise expenses
|
30,973
|
|
|
61,029
|
|
|
50,890
|
|
|||
Total franchise expenses
|
312,754
|
|
|
330,619
|
|
|
293,986
|
|
|||
Company restaurant expenses
|
123,272
|
|
|
5,872
|
|
|
7,838
|
|
|||
Rental expenses:
|
|
|
|
|
|
||||||
Interest expense from finance leases
|
5,602
|
|
|
6,894
|
|
|
8,153
|
|
|||
Other rental expenses
|
85,157
|
|
|
83,862
|
|
|
82,439
|
|
|||
Total rental expenses
|
90,759
|
|
|
90,756
|
|
|
90,592
|
|
|||
Financing expenses
|
579
|
|
|
597
|
|
|
598
|
|
|||
Total cost of revenues
|
527,364
|
|
|
427,844
|
|
|
393,014
|
|
|||
Gross profit
|
382,814
|
|
|
353,087
|
|
|
338,711
|
|
|||
General and administrative expenses
|
162,815
|
|
|
166,683
|
|
|
165,679
|
|
|||
Interest expense
|
60,393
|
|
|
61,686
|
|
|
61,979
|
|
|||
Amortization of intangible assets
|
11,702
|
|
|
10,105
|
|
|
10,009
|
|
|||
Closure and other impairment charges
|
1,487
|
|
|
2,107
|
|
|
3,968
|
|
|||
Loss on extinguishment of debt
|
8,276
|
|
|
—
|
|
|
—
|
|
|||
Debt refinancing costs
|
—
|
|
|
2,523
|
|
|
—
|
|
|||
Gain on disposition of assets
|
(332
|
)
|
|
(625
|
)
|
|
(6,249
|
)
|
|||
Impairment of goodwill and intangible assets
|
—
|
|
|
—
|
|
|
531,634
|
|
|||
Income (loss) before income tax (provision) benefit
|
138,473
|
|
|
110,608
|
|
|
(428,309
|
)
|
|||
Income tax (provision) benefit
|
(34,127
|
)
|
|
(30,254
|
)
|
|
85,559
|
|
|||
Net income (loss)
|
104,346
|
|
|
80,354
|
|
|
(342,750
|
)
|
|||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Adjustment to unrealized loss on available-for-sale investments
|
—
|
|
|
50
|
|
|
—
|
|
|||
Foreign currency translation adjustment
|
2
|
|
|
(5
|
)
|
|
2
|
|
|||
Total comprehensive income (loss)
|
$
|
104,348
|
|
|
$
|
80,399
|
|
|
$
|
(342,748
|
)
|
Net income (loss) available to common stockholders:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
104,346
|
|
|
$
|
80,354
|
|
|
$
|
(342,750
|
)
|
Less: Net (income) loss allocated to unvested participating restricted stock
|
(3,532
|
)
|
|
(2,711
|
)
|
|
6,768
|
|
|||
Net income (loss) available to common stockholders
|
$
|
100,814
|
|
|
$
|
77,643
|
|
|
$
|
(335,982
|
)
|
Net income (loss) available to common stockholders per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
5.95
|
|
|
$
|
4.43
|
|
|
$
|
(18.96
|
)
|
Diluted
|
$
|
5.85
|
|
|
$
|
4.37
|
|
|
$
|
(18.96
|
)
|
Weighted average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
16,934
|
|
|
17,533
|
|
|
17,725
|
|
|||
Diluted
|
17,245
|
|
|
17,789
|
|
|
17,740
|
|
Dine Brands Global, Inc. and Subsidiaries
Consolidated Statements of Stockholders' (Deficit) Equity
(In thousands)
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
Common Stock
|
|
|
|
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Treasury Stock
|
|
|
||||||||||||||||
|
|
Shares
Outstanding
|
Amount
|
|
Additional
Paid-in
Capital
|
|
Retained Earnings (Accumulated Deficit)
|
|
Shares
|
Cost
|
|
Total
|
||||||||||||||||
Balance at December 31, 2016
|
|
17,970
|
|
$
|
251
|
|
|
$
|
292,809
|
|
|
$
|
325,451
|
|
|
$
|
(107
|
)
|
|
7,165
|
|
$
|
(422,263
|
)
|
|
$
|
196,141
|
|
Net loss
|
|
—
|
|
—
|
|
|
—
|
|
|
(342,750
|
)
|
|
—
|
|
|
—
|
|
—
|
|
|
(342,750
|
)
|
||||||
Other comprehensive gain
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
—
|
|
|
2
|
|
||||||
Purchase of Company common stock
|
|
(146
|
)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
146
|
|
(10,003
|
)
|
|
(10,003
|
)
|
||||||
Reissuance of treasury stock
|
|
281
|
|
—
|
|
|
(7,478
|
)
|
|
—
|
|
|
—
|
|
|
(281
|
)
|
10,113
|
|
|
2,635
|
|
||||||
Net use of shares for stock plans
|
|
(71
|
)
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
||||||
Repurchase of restricted shares for taxes
|
|
(41
|
)
|
|
|
(2,396
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
(2,396
|
)
|
|||||||
Stock-based compensation
|
|
—
|
|
—
|
|
|
10,783
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
10,783
|
|
||||||
Dividends on common stock
|
|
—
|
|
—
|
|
|
407
|
|
|
(52,641
|
)
|
|
—
|
|
|
—
|
|
—
|
|
|
(52,234
|
)
|
||||||
Dividends on common stock in excess of retained earnings
|
|
—
|
|
—
|
|
|
(17,718
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
(17,718
|
)
|
||||||
Balance at December 31, 2017
|
|
17,993
|
|
250
|
|
|
276,408
|
|
|
(69,940
|
)
|
|
(105
|
)
|
|
7,029
|
|
(422,153
|
)
|
|
(215,540
|
)
|
||||||
Net income
|
|
—
|
|
—
|
|
|
—
|
|
|
80,354
|
|
|
—
|
|
|
—
|
|
—
|
|
|
80,354
|
|
||||||
Other comprehensive gain
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45
|
|
|
—
|
|
—
|
|
|
45
|
|
||||||
Purchase of Company common stock
|
|
(479
|
)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
479
|
|
(34,929
|
)
|
|
(34,929
|
)
|
||||||
Reissuance of treasury stock
|
|
167
|
|
—
|
|
|
(2,551
|
)
|
|
—
|
|
|
—
|
|
|
(167
|
)
|
6,479
|
|
|
3,928
|
|
||||||
Net use of shares for stock plans
|
|
(11
|
)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
||||||
Repurchase of restricted shares for taxes
|
|
(27
|
)
|
—
|
|
|
(1,972
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
(1,972
|
)
|
||||||
Stock-based compensation
|
|
—
|
|
—
|
|
|
10,546
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
10,546
|
|
||||||
Dividends on common stock in excess of retained earnings
|
|
—
|
|
—
|
|
|
(44,705
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
(44,705
|
)
|
||||||
Balance at December 31, 2018
|
|
17,644
|
|
250
|
|
|
237,726
|
|
|
10,414
|
|
|
(60
|
)
|
|
7,341
|
|
(450,603
|
)
|
|
(202,273
|
)
|
||||||
Adoption of ASC 842 (Note 2)
|
|
—
|
|
—
|
|
|
—
|
|
|
(5,030
|
)
|
|
—
|
|
|
—
|
|
—
|
|
|
(5,030
|
)
|
||||||
Net income
|
|
—
|
|
—
|
|
|
—
|
|
|
104,346
|
|
|
—
|
|
|
—
|
|
—
|
|
|
104,346
|
|
||||||
Other comprehensive gain
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
—
|
|
|
2
|
|
||||||
Purchase of Company common stock
|
|
(1,348
|
)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,348
|
|
(111,697
|
)
|
|
(111,697
|
)
|
||||||
Reissuance of treasury stock
|
|
285
|
|
(1
|
)
|
|
(520
|
)
|
|
—
|
|
|
—
|
|
|
(285
|
)
|
12,490
|
|
|
11,969
|
|
||||||
Net use of shares for stock plans
|
|
(30
|
)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
||||||
Repurchase of restricted shares for taxes
|
|
(30
|
)
|
—
|
|
|
(2,728
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
(2,728
|
)
|
||||||
Stock-based compensation
|
|
—
|
|
—
|
|
|
10,808
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
10,808
|
|
||||||
Dividends on common stock
|
|
—
|
|
—
|
|
|
982
|
|
|
(48,077
|
)
|
|
—
|
|
|
—
|
|
—
|
|
|
(47,095
|
)
|
||||||
Other
|
|
—
|
|
—
|
|
|
(76
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
(76
|
)
|
||||||
Balance at December 31, 2019
|
|
16,522
|
|
$
|
249
|
|
|
$
|
246,192
|
|
|
$
|
61,653
|
|
|
$
|
(58
|
)
|
|
8,404
|
|
$
|
(549,810
|
)
|
|
$
|
(241,774
|
)
|
Dine Brands Global, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In thousands)
|
|||||||||||
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
104,346
|
|
|
$
|
80,354
|
|
|
$
|
(342,750
|
)
|
Adjustments to reconcile net income (loss) to cash flows provided by operating activities:
|
|
|
|
|
|
||||||
Impairment of goodwill and intangible assets
|
—
|
|
|
—
|
|
|
531,634
|
|
|||
Depreciation and amortization
|
42,493
|
|
|
32,175
|
|
|
30,648
|
|
|||
Non-cash stock-based compensation expense
|
10,808
|
|
|
10,546
|
|
|
10,752
|
|
|||
Non-cash interest expense
|
3,369
|
|
|
3,792
|
|
|
3,364
|
|
|||
Loss on extinguishment of debt
|
8,276
|
|
|
—
|
|
|
—
|
|
|||
Closure and impairment charges
|
1,485
|
|
|
2,038
|
|
|
3,834
|
|
|||
Deferred income taxes
|
(5,494
|
)
|
|
(11,847
|
)
|
|
(136,127
|
)
|
|||
Deferred revenue
|
(7,695
|
)
|
|
(5,577
|
)
|
|
—
|
|
|||
Gain on disposition of assets
|
(332
|
)
|
|
(623
|
)
|
|
(6,285
|
)
|
|||
Other
|
(5,374
|
)
|
|
(949
|
)
|
|
(10,980
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable, net
|
(396
|
)
|
|
3,149
|
|
|
(8,430
|
)
|
|||
Current income tax receivables and payables
|
8,677
|
|
|
8,119
|
|
|
(8,490
|
)
|
|||
Gift card receivables and payables
|
(1,037
|
)
|
|
(1,488
|
)
|
|
(3,322
|
)
|
|||
Other current assets
|
(498
|
)
|
|
10,425
|
|
|
(8,247
|
)
|
|||
Accounts payable
|
583
|
|
|
(9,940
|
)
|
|
7,208
|
|
|||
Accrued employee compensation and benefits
|
(3,575
|
)
|
|
13,183
|
|
|
(1,126
|
)
|
|||
Other current liabilities
|
(456
|
)
|
|
6,989
|
|
|
4,050
|
|
|||
Cash flows provided by operating activities
|
155,180
|
|
|
140,346
|
|
|
65,733
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Principal receipts from notes, equipment contracts and other long-term receivables
|
24,075
|
|
|
25,771
|
|
|
20,486
|
|
|||
Proceeds from sale of property and equipment
|
2,540
|
|
|
655
|
|
|
1,100
|
|
|||
Acquisition of business
|
—
|
|
|
(20,155
|
)
|
|
—
|
|
|||
Additions to property and equipment
|
(19,424
|
)
|
|
(14,279
|
)
|
|
(13,370
|
)
|
|||
Additions to long-term receivables
|
(6,955
|
)
|
|
(6,500
|
)
|
|
—
|
|
|||
Other
|
(389
|
)
|
|
(293
|
)
|
|
(541
|
)
|
|||
Cash flows (used in) provided by investing activities
|
(153
|
)
|
|
(14,801
|
)
|
|
7,675
|
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Proceeds from issuance of long-term debt
|
1,300,000
|
|
|
—
|
|
|
—
|
|
|||
Repayment of long-term debt
|
(1,283,750
|
)
|
|
(13,000
|
)
|
|
(3,250
|
)
|
|||
Borrowings from revolving credit facilities
|
—
|
|
|
75,000
|
|
|
—
|
|
|||
Repayments of revolving credit facilities
|
(25,000
|
)
|
|
(50,000
|
)
|
|
—
|
|
|||
Dividends paid on common stock
|
(46,859
|
)
|
|
(51,125
|
)
|
|
(69,790
|
)
|
|||
Repurchase of Dine Brands common stock
|
(109,698
|
)
|
|
(33,603
|
)
|
|
(10,003
|
)
|
|||
Principal payments of finance lease obligations
|
(13,639
|
)
|
|
(13,907
|
)
|
|
(12,949
|
)
|
|||
Payment of debt issuance costs
|
(13,150
|
)
|
|
(3,633
|
)
|
|
—
|
|
|||
Proceeds from stock options exercised
|
11,969
|
|
|
3,928
|
|
|
2,635
|
|
|||
Tax payments for restricted stock upon vesting
|
(2,728
|
)
|
|
(1,972
|
)
|
|
(2,396
|
)
|
|||
Other
|
(76
|
)
|
|
—
|
|
|
—
|
|
|||
Cash flows used in financing activities
|
(182,931
|
)
|
|
(88,312
|
)
|
|
(95,753
|
)
|
|||
Net change in cash, cash equivalents and restricted cash
|
(27,904
|
)
|
|
37,233
|
|
|
(22,345
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of year
|
200,379
|
|
|
163,146
|
|
|
185,491
|
|
|||
Cash, cash equivalents and restricted cash at end of year
|
$
|
172,475
|
|
|
$
|
200,379
|
|
|
$
|
163,146
|
|
Supplemental disclosures
|
|
|
|
|
|
||||||
Interest paid
|
$
|
66,104
|
|
|
$
|
66,059
|
|
|
$
|
67,522
|
|
Income taxes paid
|
$
|
44,748
|
|
|
$
|
34,246
|
|
|
$
|
59,528
|
|
Non-cash conversion of accounts receivable to notes receivable
|
$
|
185
|
|
|
$
|
11,959
|
|
|
$
|
5,286
|
|
Category
|
|
Depreciable Life
|
Buildings and improvements
|
|
25 to 40 years
|
Leaseholds and improvements
|
|
Shorter of primary lease term or between three to 40 years
|
Equipment and fixtures
|
|
Three to five years
|
Internal-use software
|
|
Three to 10 years
|
Properties under finance leases
|
|
Primary lease term or remaining primary lease term
|
•
|
Franchise and development fees are recognized as revenue ratably on a straight-line basis over the term of the franchise agreement commencing with the restaurant opening date. As these fees are typically received in cash at or near the beginning of the franchise term, the cash received is initially recorded as a contract liability until recognized as revenue over time;
|
•
|
The Company is entitled to royalties and advertising fees based on a percentage of the franchisee's gross sales as defined in the franchise agreement. Royalty and advertising revenue are recognized when the franchisee's reported sales occur. Depending on timing within a fiscal period, the recognition of revenue results in either a contract asset (unbilled receivable) or, once billed, accounts receivable, on the balance sheet;
|
•
|
Revenue from the sales of proprietary pancake and waffle dry mix is recognized in the period in which distributors ship the franchisee's order; recognition of revenue results in accounts receivable on the balance sheet.
|
•
|
Level 1 inputs are quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities.
|
•
|
Level 3 inputs are unobservable and reflect the Company's own assumptions.
|
|
|
December 31, 2019
|
December 31, 2018
|
||||||
|
|
(In millions)
|
|||||||
Face value of Long-term debt
|
|
$
|
1,300.0
|
|
|
$
|
1,283.8
|
|
|
Fair value of Long-term debt
|
|
$
|
1,326.3
|
|
|
$
|
1,280.9
|
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
|
(In thousands)
|
||||||||||
Franchise Revenue:
|
|
|
|
|
|
|
|
|
||||
Royalties
|
|
$
|
302,169
|
|
|
$
|
311,568
|
|
|
$
|
297,817
|
|
Advertising fees
|
|
283,015
|
|
|
268,294
|
|
|
234,165
|
|
|||
Pancake and waffle dry mix sales and other
|
|
53,973
|
|
|
52,108
|
|
|
50,538
|
|
|||
Franchise and development fees
|
|
12,029
|
|
|
11,964
|
|
|
11,898
|
|
|||
Total franchise revenue
|
|
$
|
651,186
|
|
|
$
|
643,934
|
|
|
$
|
594,418
|
|
|
|
Deferred Franchise Revenue (short- and long-term)
|
||
|
|
(In thousands)
|
||
Balance at December 31, 2018
|
|
$
|
74,695
|
|
Recognized as revenue during the year ended December 31, 2019
|
|
(11,350
|
)
|
|
Fees deferred during the year ended December 31, 2019
|
|
3,685
|
|
|
Balance at December 31, 2019
|
|
$
|
67,030
|
|
|
(In thousands)
|
||
2020
|
$
|
10,086
|
|
2021
|
7,862
|
|
|
2022
|
7,337
|
|
|
2023
|
6,765
|
|
|
2024
|
6,074
|
|
|
Thereafter
|
28,906
|
|
|
Total
|
$
|
67,030
|
|
4. Receivables
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Accounts receivable
|
$
|
60.8
|
|
|
$
|
63.0
|
|
Gift card receivables
|
46.7
|
|
|
47.9
|
|
||
Notes receivable
|
28.9
|
|
|
28.9
|
|
||
Financing receivables:
|
|
|
|
||||
Equipment leases receivable
|
56.3
|
|
|
65.8
|
|
||
Direct financing leases receivable
|
34.0
|
|
|
44.9
|
|
||
Franchise fee notes receivable
|
0.2
|
|
|
0.2
|
|
||
Other
|
7.3
|
|
|
7.1
|
|
||
|
234.2
|
|
|
257.8
|
|
||
Less: allowance for doubtful accounts and notes receivable
|
(11.3
|
)
|
|
(17.2
|
)
|
||
|
222.9
|
|
|
240.6
|
|
||
Less: current portion
|
(136.9
|
)
|
|
(137.5
|
)
|
||
Long-term receivables
|
$
|
86.0
|
|
|
$
|
103.1
|
|
Allowance for Doubtful Accounts
|
(In millions)
|
||
Balance at December 31, 2016
|
$
|
3.1
|
|
Provision
|
20.3
|
|
|
Charge-offs
|
(1.2
|
)
|
|
Balance at December 31, 2017
|
22.2
|
|
|
Provision
|
10.3
|
|
|
Charge-offs
|
(15.3
|
)
|
|
Balance at December 31, 2018
|
17.2
|
|
|
Provision
|
(0.4
|
)
|
|
Charge-offs
|
(5.0
|
)
|
|
Recoveries
|
(0.5
|
)
|
|
Balance at December 31, 2019
|
$
|
11.3
|
|
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Leaseholds and improvements
|
$
|
235.4
|
|
|
$
|
255.7
|
|
Equipment and fixtures
|
95.4
|
|
|
90.1
|
|
||
Properties under finance lease
|
100.5
|
|
|
100.3
|
|
||
Buildings and improvements
|
56.6
|
|
|
57.9
|
|
||
Land
|
55.9
|
|
|
56.4
|
|
||
Construction in progress
|
4.7
|
|
|
3.7
|
|
||
Property and equipment, gross
|
548.5
|
|
|
564.1
|
|
||
Less: accumulated depreciation and amortization
|
(332.1
|
)
|
|
(323.8
|
)
|
||
Property and equipment, net
|
$
|
216.4
|
|
|
$
|
240.3
|
|
|
Applebee's Franchise Unit
|
|
Applebee's Company Unit
|
|
IHOP Franchise Unit
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Balance at December 31, 2016
|
$
|
686.6
|
|
|
$
|
—
|
|
|
$
|
10.8
|
|
|
$
|
697.4
|
|
Impairment
|
(358.2
|
)
|
|
—
|
|
|
—
|
|
|
(358.2
|
)
|
||||
Balance at December 31, 2017
|
328.4
|
|
|
—
|
|
|
10.8
|
|
|
339.2
|
|
||||
Business acquisition
|
—
|
|
|
6.1
|
|
|
—
|
|
|
6.1
|
|
||||
Balance at December 31, 2018
|
328.4
|
|
|
6.1
|
|
|
10.8
|
|
|
345.3
|
|
||||
Purchase price adjustment related to business acquisition
|
—
|
|
|
(1.5
|
)
|
|
—
|
|
|
(1.5
|
)
|
||||
Balance at December 31, 2019
|
$
|
328.4
|
|
|
$
|
4.6
|
|
|
$
|
10.8
|
|
|
$
|
343.9
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Applebee's Franchise Unit
|
$
|
686.6
|
|
|
$
|
(358.2
|
)
|
|
$
|
328.4
|
|
|
$
|
686.6
|
|
|
$
|
(358.2
|
)
|
|
$
|
328.4
|
|
Applebee's Company Unit
|
4.6
|
|
|
—
|
|
|
4.6
|
|
|
6.1
|
|
|
—
|
|
|
6.1
|
|
||||||
IHOP Franchise Unit
|
10.8
|
|
|
—
|
|
|
10.8
|
|
|
10.8
|
|
|
—
|
|
|
10.8
|
|
||||||
Total
|
$
|
702.1
|
|
|
$
|
(358.2
|
)
|
|
$
|
343.9
|
|
|
$
|
703.5
|
|
|
$
|
(358.2
|
)
|
|
$
|
345.3
|
|
|
Not Subject to Amortization
|
|
Subject to Amortization
|
|
|
||||||||||||||||||
|
Tradename
|
|
Other
|
|
Franchising
Rights
|
|
Reacquired Franchise Rights
|
|
Leaseholds
|
|
Total
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Balance at December 31, 2016
|
$
|
652.4
|
|
|
$
|
2.0
|
|
|
$
|
109.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
763.4
|
|
Impairment
|
(173.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(173.4
|
)
|
||||||
Amortization expense
|
—
|
|
|
—
|
|
|
(10.0
|
)
|
|
—
|
|
|
—
|
|
|
(10.0
|
)
|
||||||
Additions
|
—
|
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|
2.4
|
|
|
2.8
|
|
||||||
Balance at December 31, 2017
|
479.0
|
|
|
2.4
|
|
|
99.0
|
|
|
—
|
|
|
2.4
|
|
|
582.8
|
|
||||||
Amortization expense
|
—
|
|
|
—
|
|
|
(10.0
|
)
|
|
(0.1
|
)
|
|
(0.0
|
)
|
|
(10.1
|
)
|
||||||
Additions
|
—
|
|
|
0.3
|
|
|
—
|
|
|
11.6
|
|
|
1.3
|
|
|
13.2
|
|
||||||
Balance at December 31, 2018
|
479.0
|
|
|
2.7
|
|
|
89.0
|
|
|
11.5
|
|
|
3.7
|
|
|
585.9
|
|
||||||
Amortization expense
|
—
|
|
|
—
|
|
|
(10.0
|
)
|
|
(1.7
|
)
|
|
(0.1
|
)
|
|
(11.8
|
)
|
||||||
Additions
|
—
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
|
1.0
|
|
||||||
Balance at December 31, 2019
|
$
|
479.0
|
|
|
$
|
3.2
|
|
|
$
|
79.0
|
|
|
$
|
9.8
|
|
|
$
|
4.1
|
|
|
$
|
575.1
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Franchising rights
|
$
|
200.0
|
|
|
$
|
(121.0
|
)
|
|
$
|
79.0
|
|
|
$
|
200.0
|
|
|
$
|
(111.0
|
)
|
|
$
|
89.0
|
|
Reacquired Franchise Rights
|
11.6
|
|
|
(1.8
|
)
|
|
9.8
|
|
|
11.6
|
|
|
(0.1
|
)
|
|
11.5
|
|
||||||
Leaseholds
|
4.2
|
|
|
(0.1
|
)
|
|
4.1
|
|
|
$
|
3.7
|
|
|
(0.0
|
)
|
|
3.7
|
|
|||||
Total
|
$
|
215.8
|
|
|
$
|
(122.9
|
)
|
|
$
|
92.9
|
|
|
$
|
215.3
|
|
|
$
|
(111.1
|
)
|
|
$
|
104.2
|
|
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Series 2019-1 4.194% Fixed Rate Senior Secured Notes, Class A-2-I
|
$
|
700.0
|
|
|
$
|
—
|
|
Series 2019-1 4.723% Fixed Rate Senior Secured Notes, Class A-2-II
|
600.0
|
|
|
—
|
|
||
Series 2014-1 4.277% Fixed Rate Senior Secured Notes, Class A-2
|
—
|
|
|
1,283.8
|
|
||
Series 2018-1 Variable Funding Senior Notes Class A-1, variable interest rate of 4.93% at December 31, 2018
|
—
|
|
|
25.0
|
|
||
Class A-2-I and A-2-II (2019) and Class A-2 (2018) Note debt issuance costs
|
(11.8
|
)
|
|
(9.7
|
)
|
||
Long-term debt, net of debt issuance costs
|
1,288.2
|
|
|
1,299.1
|
|
||
Current portion of long-term debt
|
—
|
|
|
(25.0
|
)
|
||
Long-term debt
|
$
|
1,288.2
|
|
|
$
|
1,274.1
|
|
|
(In millions)
|
||
2020
|
$
|
—
|
|
2021
|
—
|
|
|
2022
|
—
|
|
|
2023
|
—
|
|
|
2024
|
700.0
|
|
|
Thereafter
|
600.0
|
|
|
Total
|
$
|
1,300.0
|
|
Fiscal Years
|
(In millions)
|
||
2020(1)
|
$
|
5.6
|
|
2021
|
5.1
|
|
|
2022
|
5.1
|
|
|
2023
|
5.0
|
|
|
2024(1)
|
5.7
|
|
|
Thereafter
|
44.8
|
|
|
Total minimum lease payments
|
71.3
|
|
|
Less: interest
|
(32.8
|
)
|
|
Total financing obligations
|
38.5
|
|
|
Less: current portion(2)
|
(0.8
|
)
|
|
Long-term financing obligations
|
$
|
37.7
|
|
(1)
|
Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in 2020 and 2024.
|
(2)
|
Included in current maturities of finance lease and financing obligations on the consolidated balance sheet.
|
|
|
Year ended December 31, 2019
|
||
Finance lease cost:
|
(In millions)
|
|||
Amortization of right-of-use assets
|
|
$
|
5.3
|
|
Interest on lease liabilities
|
|
7.7
|
|
|
Operating lease cost
|
|
106.2
|
|
|
Variable lease cost
|
|
2.7
|
|
|
Short-term lease cost
|
|
0.0
|
|
|
Sublease income
|
|
(110.9
|
)
|
|
Lease cost
|
|
$
|
11.0
|
|
|
Finance
Leases
|
|
Operating
Leases
|
||||
|
(In millions)
|
||||||
2020
|
$
|
19.8
|
|
|
$
|
97.4
|
|
2021
|
16.4
|
|
|
81.1
|
|
||
2022
|
14.7
|
|
|
73.4
|
|
||
2023
|
11.6
|
|
|
60.6
|
|
||
2024
|
9.4
|
|
|
54.9
|
|
||
Thereafter
|
55.7
|
|
|
173.0
|
|
||
Total minimum lease payments
|
127.6
|
|
|
540.4
|
|
||
Less: interest/imputed interest
|
(37.3
|
)
|
|
(108.6
|
)
|
||
Total obligations
|
90.3
|
|
|
431.8
|
|
||
Less: current portion
|
(12.9
|
)
|
|
(72.8
|
)
|
||
Long-term lease obligations
|
$
|
77.4
|
|
|
$
|
359.0
|
|
|
|
Year ended December 31, 2019
|
||
|
(In millions)
|
|||
Principal payments on finance lease obligations
|
|
$
|
13.6
|
|
Interest payments on finance lease obligations
|
|
$
|
7.7
|
|
Payments on operating leases
|
|
$
|
91.9
|
|
Variable lease payments
|
|
$
|
2.5
|
|
|
|
Year ended December 31, 2019
|
||
|
(In millions)
|
|||
Minimum lease payments
|
|
$
|
102.8
|
|
Variable lease income
|
|
11.5
|
|
|
Total operating lease income
|
|
$
|
114.3
|
|
|
(In millions)
|
||
2020
|
$
|
108.3
|
|
2021
|
102.6
|
|
|
2022
|
99.6
|
|
|
2023
|
95.2
|
|
|
2024
|
86.5
|
|
|
Thereafter
|
214.5
|
|
|
Total minimum rents receivable
|
$
|
706.7
|
|
|
|
Year ended December 31, 2019
|
||
|
(In millions)
|
|||
Interest income
|
|
$
|
5.0
|
|
Variable lease income
|
|
1.3
|
|
|
Total operating lease income
|
|
$
|
6.3
|
|
|
December 31,
|
||
|
2018
|
||
|
(In millions)
|
||
Total minimum rents receivable
|
$
|
57.3
|
|
Less: unearned income
|
(12.4
|
)
|
|
Net investment in direct financing leases receivable
|
44.9
|
|
|
Less: current portion
|
(11.2
|
)
|
|
Long-term direct financing leases receivable
|
$
|
33.7
|
|
|
December 31,
|
||
|
2018
|
||
|
(In millions)
|
||
Total minimum leases receivable
|
$
|
89.9
|
|
Less: unearned income
|
(24.1
|
)
|
|
Net investment in equipment leases receivable
|
65.8
|
|
|
Less: current portion
|
(8.5
|
)
|
|
Long-term equipment leases receivable
|
$
|
57.3
|
|
|
Capital
Leases
|
|
Operating
Leases
|
||||
|
(In millions)
|
||||||
2019
|
$
|
21.0
|
|
|
$
|
91.2
|
|
2020(1)
|
19.3
|
|
|
92.8
|
|
||
2021
|
16.2
|
|
|
75.7
|
|
||
2022
|
14.3
|
|
|
67.6
|
|
||
2023
|
11.6
|
|
|
55.2
|
|
||
Thereafter
|
63.4
|
|
|
210.6
|
|
||
Total minimum lease payments
|
145.8
|
|
|
$
|
593.0
|
|
|
Less: interest
|
(44.6
|
)
|
|
|
|
||
Capital lease obligations
|
101.2
|
|
|
|
|
||
Less: current portion(1)
|
(13.4
|
)
|
|
|
|
||
Long-term capital lease obligations
|
$
|
87.8
|
|
|
|
|
|
Direct
Financing
Leases
|
|
Operating
Leases
|
||||
|
(In millions)
|
||||||
2019
|
$
|
16.2
|
|
|
$
|
105.9
|
|
2020(1)
|
14.8
|
|
|
106.3
|
|
||
2021
|
11.7
|
|
|
100.2
|
|
||
2022
|
8.2
|
|
|
96.2
|
|
||
2023
|
3.5
|
|
|
91.8
|
|
||
Thereafter
|
2.9
|
|
|
271.8
|
|
||
Total minimum rents receivable
|
$
|
57.3
|
|
|
$
|
772.2
|
|
|
Shares
|
|
Cost of shares
|
|||
|
|
|
(In millions)
|
|||
2019 Repurchase Program:
|
|
|
|
|||
Repurchased during the year ended December 31, 2019
|
1,237,698
|
|
|
$
|
103.3
|
|
Cumulative (life-of-program) repurchases
|
1,237,698
|
|
|
$
|
103.3
|
|
Remaining dollar value of shares that may be repurchased
|
n/a
|
|
$
|
96.7
|
|
|
|
|
|
|
|||
2015 Repurchase Program:
|
|
|
|
|||
Repurchased during the year ended December 31, 2019
|
110,499
|
|
|
$
|
8.4
|
|
Cumulative (life-of-program) repurchases
|
1,589,995
|
|
|
$
|
126.2
|
|
Remaining dollar value of shares that may be repurchased
|
n/a
|
|
n/a
|
Year ended December 31, 2019
|
Declaration Date
|
|
Payment Date
|
|
Dividends declared per share
|
|
Dividends paid per share
|
|
Total dividends paid(1)
|
||||||
|
|
|
|
|
|
|
|
|
(In millions)
|
||||||
Payment of prior year declaration
|
(3)
|
|
January 4, 2019
|
|
—
|
|
|
$
|
0.63
|
|
|
$
|
11.4
|
|
|
First quarter
|
February 20, 2019
|
|
April 5, 2019
|
|
$
|
0.69
|
|
|
0.69
|
|
|
12.5
|
|
||
Second quarter
|
May 13, 2019
|
|
July 12, 2019
|
|
0.69
|
|
|
0.69
|
|
|
12.2
|
|
|||
Third quarter
|
August 1, 2019
|
|
October 4, 2019
|
|
0.69
|
|
|
0.69
|
|
|
11.8
|
|
|||
Fourth quarter
|
October 8, 2019
|
|
(2)
|
|
0.69
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
|
|
|
$
|
2.76
|
|
|
$
|
2.70
|
|
|
$
|
47.9
|
|
Year ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||
Payment of prior year declaration
|
(4)
|
|
January 5, 2018
|
|
—
|
|
|
$
|
0.97
|
|
|
$
|
17.7
|
|
|
First quarter
|
February 14, 2018
|
|
April 6, 2018
|
|
$
|
0.63
|
|
|
0.63
|
|
|
11.5
|
|
||
Second quarter
|
May 14, 2018
|
|
July 6, 2018
|
|
0.63
|
|
|
0.63
|
|
|
11.4
|
|
|||
Third quarter
|
August 2, 2018
|
|
October 5, 2018
|
|
0.63
|
|
|
0.63
|
|
|
11.4
|
|
|||
Fourth quarter
|
October 6, 2018
|
|
(3)
|
|
0.63
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
|
|
|
$
|
2.52
|
|
|
$
|
2.86
|
|
|
$
|
52.0
|
|
Year ended December 31, 2017
|
|
|
|
|
|
|
|
|
|
||||||
Payment of prior year declaration
|
(5)
|
|
January 6, 2017
|
|
$
|
—
|
|
|
$
|
0.97
|
|
|
$
|
17.5
|
|
First quarter
|
February 22, 2017
|
|
April 7, 2017
|
|
$
|
0.97
|
|
|
0.97
|
|
|
17.5
|
|
||
Second quarter
|
May 15, 2017
|
|
July 7, 2017
|
|
0.97
|
|
|
0.97
|
|
|
17.5
|
|
|||
Third quarter
|
August 10, 2017
|
|
October 6, 2017
|
|
0.97
|
|
|
0.97
|
|
|
17.8
|
|
|||
Fourth quarter
|
October 6, 2017
|
|
(4)
|
|
0.97
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
|
|
|
$
|
3.88
|
|
|
$
|
3.88
|
|
|
$
|
70.3
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In millions)
|
||||||||||
Dividends declared from retained earnings
|
$
|
(48.1
|
)
|
|
$
|
—
|
|
|
$
|
(52.6
|
)
|
Dividends declared from additional paid-in capital
|
$
|
—
|
|
|
$
|
(44.7
|
)
|
|
$
|
(17.7
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In millions)
|
||||||||||
Closure charges
|
$
|
1.5
|
|
|
$
|
2.0
|
|
|
$
|
3.9
|
|
Long-lived tangible asset impairment
|
—
|
|
|
0.1
|
|
|
0.1
|
|
|||
Total closure and impairment charges
|
$
|
1.5
|
|
|
$
|
2.1
|
|
|
$
|
4.0
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In millions)
|
||||||||||
Total stock-based compensation expense:
|
|
|
|
|
|
||||||
Equity classified awards expense
|
$
|
10.9
|
|
|
$
|
10.6
|
|
|
$
|
10.9
|
|
Liability classified awards expense (credit)
|
3.2
|
|
|
3.1
|
|
|
(1.0
|
)
|
|||
Total pretax stock-based compensation expense
|
14.1
|
|
|
13.7
|
|
|
9.9
|
|
|||
Book income tax benefit
|
(3.5
|
)
|
|
(3.5
|
)
|
|
(3.8
|
)
|
|||
Total stock-based compensation expense, net of tax
|
$
|
10.6
|
|
|
$
|
10.2
|
|
|
$
|
6.1
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Risk free interest rate
|
2.5
|
%
|
|
2.6
|
%
|
|
1.9
|
%
|
|||
Weighted average historical volatility
|
30.3
|
%
|
|
26.1
|
%
|
|
22.9
|
%
|
|||
Dividend yield
|
2.8
|
%
|
|
3.6
|
%
|
|
7.3
|
%
|
|||
Expected years until exercise
|
4.7
|
|
|
4.6
|
|
|
4.5
|
|
|||
Weighted average fair value of options granted
|
$
|
21.93
|
|
|
$
|
11.94
|
|
|
$
|
4.31
|
|
|
2018
|
2017
|
||||
Risk free interest rate
|
2.5
|
%
|
1.6
|
%
|
||
Weighted average historical volatility
|
34.4
|
%
|
30.0
|
%
|
||
Dividend yield
|
3.4
|
%
|
9.6
|
%
|
||
Expected years until exercise
|
3.0
|
|
3.4
|
|
||
Weighted average fair value of options granted
|
$
|
9.79
|
|
$
|
3.07
|
|
Weighted average fair value of restricted stock units granted
|
$
|
53.72
|
|
$
|
10.19
|
|
|
Number of
Shares Under Option
|
|
Weighted Average
Exercise Price
Per Share
|
|
Weighted Average
Remaining Contractual
Term (in Years)
|
|
Aggregate Intrinsic
Value (in Millions)
|
|||||
Outstanding at December 31, 2016
|
701,134
|
|
|
$
|
80.04
|
|
|
|
|
|
|
|
Granted
|
887,030
|
|
|
48.35
|
|
|
|
|
|
|
||
Exercised
|
(64,916
|
)
|
|
40.59
|
|
|
|
|
|
|
||
Forfeited
|
(171,847
|
)
|
|
65.82
|
|
|
|
|
|
|
||
Expired
|
(79,353
|
)
|
|
87.02
|
|
|
|
|
|
|
||
Outstanding at December 31, 2017
|
1,272,048
|
|
|
61.44
|
|
|
|
|
|
|
||
Granted
|
248,899
|
|
|
69.12
|
|
|
|
|
|
|
||
Exercised
|
(74,930
|
)
|
|
52.43
|
|
|
|
|
|
|
||
Forfeited
|
(6,309
|
)
|
|
68.80
|
|
|
|
|
|
|
||
Outstanding at December 31, 2018
|
1,439,708
|
|
|
63.21
|
|
|
|
|
|
|
||
Granted
|
132,832
|
|
|
98.97
|
|
|
|
|
|
|
||
Exercised
|
(211,352
|
)
|
|
57.36
|
|
|
|
|
|
|
||
Forfeited
|
(106,745
|
)
|
|
72.19
|
|
|
|
|
|
|
||
Expired
|
(37,005
|
)
|
|
93.06
|
|
|
|
|
|
|
||
Outstanding at December 31, 2019
|
1,217,438
|
|
|
$
|
66.43
|
|
|
5.7
|
|
$
|
24.1
|
|
Vested and Expected to Vest at December 31, 2019
|
1,146,329
|
|
|
$
|
67.06
|
|
|
5.6
|
|
$
|
22.0
|
|
Exercisable at December 31, 2019
|
561,872
|
|
|
$
|
77.80
|
|
|
3.1
|
|
$
|
5.9
|
|
|
Shares of Restricted Stock
|
|
Weighted
Average
Grant-Date Per
Share
Fair Value
|
|
Restricted
Stock Units
|
|
Weighted
Average
Grant-Date
Per Share
Fair Value
|
||||||
Outstanding at December 31, 2016
|
235,472
|
|
|
$
|
92.91
|
|
|
34,058
|
|
|
$
|
93.95
|
|
Granted
|
216,269
|
|
|
51.89
|
|
|
281,973
|
|
|
22.37
|
|
||
Released
|
(92,968
|
)
|
|
88.62
|
|
|
(12,683
|
)
|
|
81.63
|
|
||
Forfeited
|
(83,582
|
)
|
|
79.52
|
|
|
—
|
|
|
—
|
|
||
Outstanding at December 31, 2017
|
275,191
|
|
|
65.97
|
|
|
303,348
|
|
|
28.39
|
|
||
Granted
|
92,466
|
|
|
69.20
|
|
|
86,990
|
|
|
57.21
|
|
||
Released
|
(74,253
|
)
|
|
81.07
|
|
|
(15,737
|
)
|
|
98.54
|
|
||
Forfeited
|
(26,162
|
)
|
|
61.27
|
|
|
(72
|
)
|
|
53.49
|
|
||
Outstanding at December 31, 2018
|
267,242
|
|
|
64.21
|
|
|
374,529
|
|
|
31.05
|
|
||
Granted
|
75,556
|
|
|
96.86
|
|
|
23,427
|
|
|
95.77
|
|
||
Released
|
(76,962
|
)
|
|
76.25
|
|
|
(12,347
|
)
|
|
90.34
|
|
||
Forfeited
|
(41,321
|
)
|
|
67.20
|
|
|
(27,802
|
)
|
|
34.53
|
|
||
Outstanding at December 31, 2019
|
224,515
|
|
|
$
|
70.52
|
|
|
357,807
|
|
|
$
|
30.35
|
|
|
|
Cash-Settled Restricted
Stock Units
|
|
Weighted
Average
Grant Date
Fair Value
|
|||
Outstanding at December 31, 2018
|
|
53,766
|
|
|
$
|
79.07
|
|
Granted
|
|
20,989
|
|
|
83.58
|
|
|
Released
|
|
(462
|
)
|
|
83.18
|
|
|
Forfeited
|
|
(10,441
|
)
|
|
88.70
|
|
|
Outstanding at December 31, 2019
|
|
63,852
|
|
|
$
|
85.63
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Provision (benefit) for income taxes:
|
(In millions)
|
||||||||||
Current
|
|
|
|
|
|
||||||
Federal
|
$
|
31.2
|
|
|
$
|
33.6
|
|
|
$
|
42.6
|
|
State
|
6.5
|
|
|
6.4
|
|
|
5.1
|
|
|||
Foreign
|
1.9
|
|
|
2.1
|
|
|
2.9
|
|
|||
|
39.6
|
|
|
42.1
|
|
|
50.6
|
|
|||
Deferred
|
|
|
|
|
|
||||||
Federal
|
(3.8
|
)
|
|
(7.8
|
)
|
|
(131.0
|
)
|
|||
State
|
(1.7
|
)
|
|
(4.0
|
)
|
|
(5.1
|
)
|
|||
|
(5.5
|
)
|
|
(11.8
|
)
|
|
(136.1
|
)
|
|||
Provision (benefit) for income taxes
|
$
|
34.1
|
|
|
$
|
30.3
|
|
|
$
|
(85.6
|
)
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Statutory federal income tax rate
|
21.0
|
%
|
|
21.0
|
%
|
|
35.0
|
%
|
Non-deductibility of goodwill impairment
|
—
|
|
|
—
|
|
|
(29.3
|
)
|
Change in federal tax rate
|
—
|
|
|
—
|
|
|
15.5
|
|
State and other taxes, net of federal tax benefit
|
2.8
|
|
|
3.6
|
|
|
0.4
|
|
Change in unrecognized tax benefits
|
1.8
|
|
|
3.3
|
|
|
(0.7
|
)
|
Change in valuation allowance
|
0.5
|
|
|
0.4
|
|
|
0.3
|
|
Domestic production activity deduction
|
—
|
|
|
—
|
|
|
0.3
|
|
Changes in tax rates and state tax laws
|
(0.5
|
)
|
|
(1.6
|
)
|
|
(0.3
|
)
|
Change in accounting for excess tax deficiencies/benefits
|
(0.6
|
)
|
|
0.1
|
|
|
(0.5
|
)
|
General business credits
|
(1.3
|
)
|
|
(0.2
|
)
|
|
0.0
|
|
Other
|
0.9
|
|
|
0.8
|
|
|
(0.7
|
)
|
Effective tax rate
|
24.6
|
%
|
|
27.4
|
%
|
|
20.0
|
%
|
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Employee compensation
|
$
|
9.2
|
|
|
$
|
9.0
|
|
Revenue recognition
|
32.8
|
|
|
34.3
|
|
||
Other
|
5.9
|
|
|
16.8
|
|
||
Deferred tax assets
|
47.9
|
|
|
60.1
|
|
||
Valuation allowance
|
(1.5
|
)
|
|
(0.4
|
)
|
||
Total deferred tax assets after valuation allowance
|
46.4
|
|
|
59.7
|
|
||
Recognition of franchise and equipment sales
|
(13.7
|
)
|
|
(16.8
|
)
|
||
Capitalization and depreciation (1)
|
(130.8
|
)
|
|
(139.2
|
)
|
||
Acquisition financing costs
|
—
|
|
|
(0.6
|
)
|
||
Basis of property and equipment
|
—
|
|
|
(8.1
|
)
|
||
Other
|
(0.4
|
)
|
|
(0.8
|
)
|
||
Deferred tax liabilities
|
(144.9
|
)
|
|
(165.5
|
)
|
||
Net deferred tax liabilities
|
$
|
(98.5
|
)
|
|
$
|
(105.8
|
)
|
(1)
|
Primarily related to the 2007 Applebee's acquisition.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Unrecognized tax benefit as of January 1
|
$
|
5.2
|
|
|
$
|
5.9
|
|
|
$
|
3.9
|
|
Changes for tax positions of prior years
|
2.1
|
|
|
3.8
|
|
|
2.8
|
|
|||
Increases for tax positions related to the current year
|
0.5
|
|
|
0.4
|
|
|
0.6
|
|
|||
Decreases relating to settlements and lapsing of statutes of limitations
|
(0.2
|
)
|
|
(4.9
|
)
|
|
(1.4
|
)
|
|||
Unrecognized tax benefit as of December 31
|
$
|
7.6
|
|
|
$
|
5.2
|
|
|
$
|
5.9
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In thousands, except per share data)
|
||||||||||
Numerator for basic and diluted income (loss) per common share:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
104,346
|
|
|
$
|
80,354
|
|
|
$
|
(342,750
|
)
|
Less: Net (income) loss allocated to unvested participating restricted stock
|
(3,532
|
)
|
|
(2,711
|
)
|
|
6,768
|
|
|||
Net income (loss) available to common stockholders - basic
|
100,814
|
|
|
77,643
|
|
|
(335,982
|
)
|
|||
Effect of unvested participating restricted stock
|
33
|
|
|
16
|
|
|
—
|
|
|||
Numerator - net income (loss) available to common shareholders - diluted
|
$
|
100,847
|
|
|
$
|
77,659
|
|
|
$
|
(335,982
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted average outstanding shares of common stock - basic
|
16,934
|
|
|
17,533
|
|
|
17,725
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Stock options(1)
|
311
|
|
|
256
|
|
|
15
|
|
|||
Weighted average outstanding shares of common stock - diluted
|
17,245
|
|
|
17,789
|
|
|
17,740
|
|
|||
Net income (loss) per common share:
|
|
|
|
|
|
||||||
Basic
|
$
|
5.95
|
|
|
$
|
4.43
|
|
|
$
|
(18.96
|
)
|
Diluted
|
$
|
5.85
|
|
|
$
|
4.37
|
|
|
$
|
(18.96
|
)
|
|
Preliminary Allocation
|
|
Adjustments
|
|
Final Allocation
|
||||||
|
(In millions)
|
||||||||||
Reacquired franchise rights
|
$
|
11.6
|
|
|
$
|
—
|
|
|
$
|
11.6
|
|
Equipment and fixtures
|
10.0
|
|
|
—
|
|
|
10.0
|
|
|||
Inventory
|
1.4
|
|
|
—
|
|
|
1.4
|
|
|||
Deferred income taxes
|
—
|
|
|
1.5
|
|
|
1.5
|
|
|||
Total identifiable assets acquired
|
23.0
|
|
|
1.5
|
|
|
24.5
|
|
|||
|
|
|
|
|
|
||||||
Above-market leaseholds, net
|
(6.5
|
)
|
|
—
|
|
|
(6.5
|
)
|
|||
Other liabilities
|
(1.0
|
)
|
|
—
|
|
|
(1.0
|
)
|
|||
Net identifiable assets acquired
|
15.5
|
|
|
1.5
|
|
|
17.0
|
|
|||
Goodwill
|
6.1
|
|
|
(1.5
|
)
|
|
4.6
|
|
|||
Consideration transferred
|
$
|
21.6
|
|
|
$
|
—
|
|
|
$
|
21.6
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
|
(In millions)
|
|
|
||||||
Franchise operations
|
$
|
651.2
|
|
|
$
|
643.9
|
|
|
$
|
594.4
|
|
Rental operations
|
120.7
|
|
|
121.9
|
|
|
121.4
|
|
|||
Company restaurants
|
131.2
|
|
|
7.1
|
|
|
7.5
|
|
|||
Financing operations
|
7.1
|
|
|
8.0
|
|
|
8.4
|
|
|||
Total
|
$
|
910.2
|
|
|
$
|
780.9
|
|
|
$
|
731.7
|
|
|
|
|
|
|
|
||||||
Gross profit (loss), by segment
|
|
|
|
|
|
||||||
Franchise operations
|
$
|
338.4
|
|
|
$
|
313.3
|
|
|
$
|
300.4
|
|
Rental operations
|
29.9
|
|
|
31.2
|
|
|
30.8
|
|
|||
Company restaurants
|
8.0
|
|
|
1.2
|
|
|
(0.3
|
)
|
|||
Financing operations
|
6.5
|
|
|
7.4
|
|
|
7.8
|
|
|||
Total gross profit
|
382.8
|
|
|
353.1
|
|
|
338.7
|
|
|||
Corporate and unallocated expenses, net
|
(244.3
|
)
|
|
(242.5
|
)
|
|
(767.0
|
)
|
|||
Income (loss) before income taxes
|
$
|
138.5
|
|
|
$
|
110.6
|
|
|
$
|
(428.3
|
)
|
|
|
|
|
|
|
||||||
Interest expense
|
|
|
|
|
|
||||||
Rental operations
|
$
|
7.7
|
|
|
$
|
9.2
|
|
|
$
|
10.5
|
|
Company restaurants
|
2.1
|
|
|
0.1
|
|
|
0.2
|
|
|||
Corporate
|
60.4
|
|
|
61.7
|
|
|
62.0
|
|
|||
Total
|
$
|
70.2
|
|
|
$
|
71.0
|
|
|
$
|
72.7
|
|
|
|
|
|
|
|
||||||
Depreciation and amortization
|
|
|
|
|
|
||||||
Franchise operations
|
$
|
10.3
|
|
|
$
|
10.5
|
|
|
$
|
10.8
|
|
Rental operations
|
13.4
|
|
|
11.7
|
|
|
12.0
|
|
|||
Company restaurants
|
6.4
|
|
|
0.4
|
|
|
0.1
|
|
|||
Corporate
|
12.4
|
|
|
9.6
|
|
|
7.7
|
|
|||
Total
|
$
|
42.5
|
|
|
$
|
32.2
|
|
|
$
|
30.6
|
|
|
|
|
|
|
|
||||||
Impairment of goodwill and intangible assets, closure and other impairment charges
|
|
|
|
|
|
||||||
Franchise operations
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
531.6
|
|
Company restaurants
|
1.5
|
|
|
2.1
|
|
|
4.0
|
|
|||
Total
|
$
|
1.5
|
|
|
$
|
2.1
|
|
|
$
|
535.6
|
|
|
|
|
|
|
|
||||||
Capital expenditures
|
|
|
|
|
|
||||||
Franchise operations
|
$
|
0.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Company restaurants
|
$
|
3.2
|
|
|
$
|
—
|
|
|
$
|
0.1
|
|
Corporate
|
15.6
|
|
|
14.3
|
|
|
13.3
|
|
|||
Total
|
$
|
19.4
|
|
|
$
|
14.3
|
|
|
$
|
13.4
|
|
|
|
|
|
|
|
||||||
Goodwill (franchise segment)
|
$
|
343.9
|
|
|
$
|
345.3
|
|
|
$
|
339.2
|
|
|
|
|
|
|
|
||||||
Total assets
|
|
|
|
|
|
||||||
Franchise operations
|
$
|
1,116.2
|
|
|
$
|
1,152.1
|
|
|
$
|
1,188.0
|
|
Rental operations
|
503.8
|
|
|
255.6
|
|
|
278.8
|
|
|||
Company restaurants
|
134.3
|
|
|
66.5
|
|
|
—
|
|
|||
Financing operations
|
72.0
|
|
|
73.7
|
|
|
87.5
|
|
|||
Corporate
|
223.2
|
|
|
226.8
|
|
|
181.3
|
|
|||
Total
|
$
|
2,049.5
|
|
|
$
|
1,774.7
|
|
|
$
|
1,735.6
|
|
|
Revenues
|
|
Gross Profit
|
|
Net Income (Loss)
|
|
Net Income
Per Share—
Basic(1)
|
|
Net Income
Per Share—
Diluted(1)
|
||||||||||
|
(In thousands, except per share amounts)
|
||||||||||||||||||
2019
|
|
|
|
|
|
|
|
|
|
||||||||||
1st Quarter
|
$
|
237,182
|
|
|
$
|
102,571
|
|
|
$
|
31,643
|
|
|
$
|
1.76
|
|
|
$
|
1.73
|
|
2nd Quarter
|
228,080
|
|
|
94,855
|
|
|
21,390
|
|
|
1.20
|
|
|
1.18
|
|
|||||
3rd Quarter
|
217,405
|
|
|
89,720
|
|
|
23,917
|
|
|
1.38
|
|
|
1.36
|
|
|||||
4th Quarter
|
227,511
|
|
|
95,668
|
|
|
27,396
|
|
|
1.61
|
|
|
1.59
|
|
|||||
2018
|
|
|
|
|
|
|
|
|
|
||||||||||
1st Quarter
|
$
|
188,163
|
|
|
$
|
83,500
|
|
|
$
|
17,073
|
|
|
$
|
0.93
|
|
|
$
|
0.92
|
|
2nd Quarter
|
184,471
|
|
|
78,590
|
|
|
12,713
|
|
|
0.70
|
|
|
0.69
|
|
|||||
3rd Quarter
|
194,099
|
|
|
92,626
|
|
|
23,587
|
|
|
1.31
|
|
|
1.29
|
|
|||||
4th Quarter
|
214,198
|
|
|
98,371
|
|
|
26,981
|
|
|
1.49
|
|
|
1.47
|
|
Plan Category
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
|
|
Weighted average exercise price of outstanding options, warrants and rights
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
||||
(a)
|
|
(b)
|
|
(c)
|
|||||
Equity compensation plans approved by security holders
|
1,217,438
|
|
|
$
|
66.43
|
|
|
2,427,518
|
|
Equity compensation plans not approved by security holders
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
1,217,438
|
|
|
$
|
66.43
|
|
|
2,427,518
|
|
•
|
Reports of Independent Registered Public Accounting Firm.
|
•
|
Consolidated Balance Sheets as of December 31, 2019 and December 31, 2018.
|
•
|
Consolidated Statements of Comprehensive Income (Loss) for each of the three years in the period ended
|
•
|
Consolidated Statements of Stockholders' (Deficit) Equity for each of the three years in the period ended
|
•
|
Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2019.
|
•
|
Notes to the Consolidated Financial Statements.
|
†10.7
|
|
|
†10.8
|
|
|
†10.9
|
|
|
†10.10
|
|
|
†10.11
|
|
|
†10.12
|
|
|
†10.13
|
|
|
†10.14
|
|
|
†10.15
|
|
|
†10.16
|
|
|
†10.17
|
|
|
†10.18
|
|
|
†10.19
|
|
|
†10.20
|
|
|
†10.21
|
|
|
†10.22
|
|
|
†10.23
|
|
|
†10.24
|
|
|
†10.25
|
|
|
†10.26
|
|
†10.27
|
|
|
†10.28
|
|
|
†10.29
|
|
|
†10.30
|
|
|
†10.31
|
|
|
†10.32
|
|
|
†10.33
|
|
|
†10.34
|
|
|
†10.35
|
|
|
†10.36
|
|
|
†10.37
|
|
|
†10.38
|
|
|
†10.39
|
|
|
†10.40
|
|
|
†10.41
|
|
|
†10.42
|
|
|
†10.43
|
|
|
†10.44
|
|
|
†10.45
|
|
|
†10.46
|
|
|
†10.47
|
|
†10.48
|
|
|
†10.49
|
|
|
†10.50
|
|
|
†10.51
|
|
|
†10.52
|
|
|
†10.53
|
|
|
†10.54
|
|
|
†10.55
|
|
|
†10.56
|
|
|
†10.57
|
|
|
†10.58
|
|
|
†10.59
|
|
|
†10.60
|
|
|
†10.61
|
|
|
†10.62
|
|
|
†10.63
|
|
|
†10.64
|
|
|
†10.65
|
|
|
†10.66
|
|
|
†10.67
|
|
|
†10.68
|
|
|
10.69
|
|
10.70
|
|
|
10.71
|
|
|
10.72
|
|
|
*10.73
|
|
|
†10.74
|
|
|
*†10.75
|
|
|
*21
|
|
|
*23.1
|
|
|
*31.1
|
|
|
*31.2
|
|
|
*32.1
|
|
|
*32.2
|
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
101.SCH
|
|
Inline XBRL Schema Document.***
|
101.CAL
|
|
Inline XBRL Calculation Linkbase Document.***
|
101.DEF
|
|
Inline XBRL Definition Linkbase Document.***
|
101.LAB
|
|
Inline XBRL Label Linkbase Document.***
|
101.PRE
|
|
Inline XBRL Presentation Linkbase Document.***
|
104
|
|
Cover page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
*
|
Filed herewith.
|
**
|
The certifications attached as Exhibits 32.1 and 32.2 accompany this Quarterly Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
|
***
|
Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibit 101 and 104 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.
|
†
|
A contract, compensatory plan or arrangement in which directors or executive officers are eligible to participate.
|
#
|
Portions of this exhibit have been omitted per an Order Granting Confidential Treatment Under the Securities Exchange Act of 1934 issued by the Securities and Exchange Commission on January 3, 2018.
|
|
DINE BRANDS GLOBAL, INC.
|
|
|
By:
|
/s/ STEPHEN P. JOYCE
|
|
|
Stephen P. Joyce
Chief Executive Officer
|
Name
|
|
Title
|
|
|
|
/s/ STEPHEN P. JOYCE
|
|
Chief Executive Officer (Principal Executive Officer), Director
|
Stephen P. Joyce
|
|
|
|
|
|
/s/ THOMAS H. SONG
|
|
Chief Financial Officer (Principal Financial Officer)
|
Thomas H. Song
|
|
|
|
|
|
/s/ RICHARD J. DAHL
|
|
Director
|
Richard J. Dahl
|
|
|
|
|
|
/s/ HOWARD M. BERK
|
|
Director
|
Howard M. Berk
|
|
|
|
|
|
/s/ DANIEL J. BRESTLE
|
|
Director
|
Daniel J. Brestle
|
|
|
|
|
|
/s/ SUSAN M. COLLYNS
|
|
Director
|
Susan M. Collyns
|
|
|
|
|
|
/s/ LARRY A. KAY
|
|
Director
|
Larry A. Kay
|
|
|
|
|
|
/s/ CAROLINE W. NAHAS
|
|
Director
|
Caroline W. Nahas
|
|
|
|
|
|
/s/ DOUGLAS M. PASQUALE
|
|
Director
|
Douglas M. Pasquale
|
|
|
|
|
|
/s/ GILBERT T. RAY
|
|
Director
|
Gilbert T. Ray
|
|
|
|
|
|
/s/ LILIAN C. TOMOVICH
|
|
Director
|
Lilian C.Tomovich
|
|
|
•
|
prior to such time, our board of directors approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder;
|
•
|
upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the corporation's voting stock outstanding at the time the transaction commenced, excluding certain shares; or
|
•
|
at or subsequent to that time, the business combination is approved by the board of directors of the corporation and authorized at an annual or special meeting, and not by written consent, by the affirmative vote of holders of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.
|
SECTION 1.
|
DEFINED TERMS.
|
SECTION 2.
|
AMENDMENT.
|
SECTION 3.
|
EFFECT ON THE EXISTING MANAGEMENT AGREEMENT AND OTHER TRANSACTION DOCUMENTS.
|
SECTION 5.
|
HEADINGS.
|
SECTION 6.
|
ENTIRE AGREEMENT.
|
SECTION 7.
|
MISCELLANEOUS.
|
EXECUTIVE
|
DINE BRANDS GLOBAL, INC.
|
|
|
By: /s/ John C. Cywinski
|
By: /s/Gregory R. Bever
|
John C. Cywinski
|
Name: Gregory R. Bever
|
|
Title: Senior Vice President, Chief People Officer
|
Name of Entity
|
State or Other
Jurisdiction of
Incorporation or
Organization
|
Dine Brands Global, Inc.
|
DE
|
Dine Brands International, Inc.
|
DE
|
International House of Pancakes, LLC
|
DE
|
III Industries of Canada LTD
|
Canada
|
IHOP of Canada ULC
|
Canada
|
IHOP TPGC, LLC
|
OH
|
IHOP SPV Guarantor LLC
|
DE
|
IHOP Funding LLC
|
DE
|
IHOP Restaurants LLC
|
DE
|
IHOP Franchisor LLC
|
DE
|
IHOP Property LLC
|
DE
|
IHOP Leasing LLC
|
DE
|
ACM Cards, Inc.
|
FL
|
Applebee's Brazil, LLC
|
KS
|
Applebee's Canada Corp.
|
Canada
|
Applebee's International, Inc.
|
DE
|
Applebee's Investments, LLC
|
KS
|
Applebee's Restaurantes de Mexico S.de R.L. de C.V.
|
Mexico
|
Applebee's UK, LLC
|
KS
|
Applebee's Restaurant Holdings, LLC
|
DE
|
Applebee's Restaurants Kansas LLC
|
KS
|
Applebee's Restaurants Mid-Atlantic LLC
|
DE
|
Applebee's Restaurants North LLC
|
DE
|
Applebee's Restaurants Texas LLC
|
TX
|
Applebee's Restaurants Vermont, Inc.
|
VT
|
Applebee's Restaurants West LLC
|
DE
|
Applebee's Restaurants Inc.
|
KS
|
Applebee's Services, Inc.
|
KS
|
Applebee's SPV Guarantor LLC
|
DE
|
Applebee's Funding LLC
|
DE
|
Applebee's Restaurants LLC
|
DE
|
Applebee's Franchisor LLC
|
DE
|
Gourmet Systems of Brazil, LLC
|
KS
|
Gourmet Systems Massachusetts, LLC
|
MA
|
Gourmet Systems of New York, Inc.
|
NY
|
Gourmet Systems of Tennessee, Inc.
|
TN
|
Gourmet Systems USA, LLC
|
KS
|
Neighborhood Insurance, Inc.
|
VT
|
Shanghai Applebee's Restaurant Management Co., Ltd.
|
Xuhui District, Puxi, China
|
Dine Brands Foundation, Inc. (dba The Heidi Fund, Inc.)
|
KS
|
DineEquity Philippines Holdings, Inc.
|
Philippines
|
•
|
Registration Statement (Form S-8 No. 333-71768) pertaining to the IHOP Corp. 2001 Stock Incentive Plan of DineEquity, Inc.,
|
•
|
Registration Statement (Form S-8 No. 333-151682) pertaining to the DineEquity, Inc. 2001 Stock Incentive Plan of DineEquity, Inc.,
|
•
|
Registration Statement (Form S-8 No. 333-174847) pertaining to the DineEquity, Inc. 2011 Stock Incentive Plan,
|
•
|
Registration Statement (Form S-8 No. 333-211429) pertaining to the Dine Brands Global, Inc. 2016 Stock Incentive Plan, and
|
•
|
Registration Statement (Form S-8 No. 333-231473) pertaining to the Dine Brands Global, Inc. 2019 Stock Incentive Plan;
|
Dated:
|
24th day of February, 2020
|
/s/ Stephen P. Joyce
|
|
|
Stephen P. Joyce
Chief Executive Officer
(Principal Executive Officer)
|
Dated:
|
24th day of February, 2020
|
/s/ Thomas H. Song
|
|
|
Thomas H. Song
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
|
Dated:
|
24th day of February, 2020
|
/s/ Stephen P. Joyce
|
|
|
Stephen P. Joyce
Chief Executive Officer
(Principal Executive Officer)
|
Dated:
|
24th day of February, 2020
|
/s/ Thomas H. Song
|
|
|
Thomas H. Song
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
|