Restaurant Financial News

Bloomin' Brands Announces 2021 Q2 Financial Results and Strong Operating Margin Expansion

Q2 Comparable Restaurant Sales Growth of 65.8% at Outback Steakhouse and 84.6% Combined U.S.

Jul 30, 2021 - 17:44

Bloomin’ Brands, Inc. (Nasdaq: BLMN) today reported results for the second quarter 2021 (“Q2 2021”) compared to the second quarter 2020 (“Q2 2020”).

CEO Comments

“Q2 represented another quarter of strong results. We are well positioned to grow sales and capture additional market share,” said David Deno, Chief Executive Officer. “We are making great progress improving margins, increasing cash flow and retaining off-premises sales as dining rooms have reopened. Our sales momentum has continued through the first four weeks of the third quarter with U.S. comp sales up 15.2% on a two-year basis versus 2019.”

Diluted EPS and Adjusted Diluted EPS

The following table reconciles Diluted earnings (loss) per share attributable to common stockholders to Adjusted diluted earnings (loss) per share for the periods indicated:

Q2

2021

2020

CHANGE

Q2 2019 (1)

Diluted earnings (loss) per share attributable to common stockholders

$

0.75

$

(1.05)

$

1.80

$

0.32

Adjustments (2)

0.06

0.31

(0.25)

0.04

Adjusted diluted earnings (loss) per share (2)

$

0.81

$

(0.74)

$

1.55

$

0.36

___________________
(1) Presented for improved comparability.
(2) See Non-GAAP Measures later in this release.

           

Second Quarter Financial Results

(dollars in millions)

Q2 2021

Q2 2020

CHANGE

Q2 2019 (1)

Total revenues

$

1,077.4

$

578.5

86.2

%

$

1,021.9

Restaurant-level operating margin

20.3

%

2.1

%

18.2

%

15.0

%

Adjusted restaurant-level operating margin (2)

20.3

%

2.7

%

17.6

%

15.0

%

GAAP operating income (loss) margin

11.6

%

(19.3)

%

30.9

%

4.3

%

Adjusted operating income (loss) margin (2)

11.0

%

(13.7)

%

24.7

%

4.6

%

___________________
(1) Presented for improved comparability.
(2) See Non-GAAP Measures later in this release.

  • The increase in Total revenues was primarily due to: (i) higher comparable restaurant sales from in-restaurant dining and strong retention of off-premises sales, (ii) higher franchise revenues and (iii) the net impact of restaurant openings and closures.
  • GAAP restaurant-level operating margin increased due to higher comparable restaurant sales and lower advertising expense. These increases were partially offset by the 2020 benefit of employee retention credits from relief pay and higher management bonus. Charges related to the COVID-19 pandemic were excluded from our 2020 Adjusted restaurant-level operating margin.
  • GAAP operating income margin increased due to: (i) an increase in restaurant-level operating margin as described above, (ii) 2020 asset impairment charges related to the COVID-19 pandemic and (iii) favorable court rulings in Brazil related to value-added taxes recorded in other revenues. These increases were partially offset by an increase in incentive compensation expense. Adjusted operating income excludes the impact of charges related to the COVID-19 pandemic, benefits from value-added tax court rulings in Brazil and expenses from restructuring and transformational initiatives.

Second Quarter Comparable Restaurant Sales

The following table includes Company-owned comparable restaurant sales for the second quarter ended June 27, 2021 as well as performance relative to 2019 for improved comparability due to the impact of COVID-19:

THIRTEEN WEEKS ENDED

JUNE 27, 2021

Comparable restaurant sales (stores open 18 months or more):

COMPARABLE TO 2019 (1)

COMPARABLE TO 2020

U.S.

Outback Steakhouse

11.3

%

65.8

%

Carrabba’s Italian Grill

16.7

%

84.3

%

Bonefish Grill

4.2

%

141.2

%

Fleming’s Prime Steakhouse & Wine Bar

24.4

%

182.6

%

Combined U.S.

12.1

%

84.6

%

International

Outback Steakhouse - Brazil (2)(3)

(36.3)

%

78.8

%

_________________
(1) Represents comparable restaurant sales increases (decreases) relative to 2019 for improved comparability due to the impact of COVID-19 on fiscal year 2020 restaurant sales.
(2) Excludes the effect of fluctuations in foreign currency rates. Includes trading day impact from calendar period reporting.
(3) Outback Steakhouse Brazil results are reported on a one-month lag and are presented on a calendar basis. Represents results through May 31, 2021.

Recent Sales Results - U.S.

Third quarter-to-date U.S. comparable restaurant sales results have continued to strengthen on a two-year basis due to our sales building initiatives, pent up consumer demand and additional stimulus.

The following tables include quarter-to-date U.S. Company-owned comparable restaurant sales for the four-week period ended July 25, 2021 and weekly U.S. comparable average unit volumes for the periods indicated:

FOUR WEEKS ENDED

JULY 25, 2021

Comparable restaurant sales (stores open 18 months or more):

COMPARABLE TO 2019 (1)

COMPARABLE TO 2020 (2)

U.S.

Outback Steakhouse

11.2

%

27.4

%

Carrabba’s Italian Grill

23.3

%

46.5

%

Bonefish Grill

12.3

%

65.4

%

Fleming’s Prime Steakhouse & Wine Bar

37.5

%

100.8

%

Combined U.S.

15.2

%

40.0

%

FOUR WEEKS ENDED

Comparable restaurant average unit volumes (weekly):

JULY 25, 2021 (3)

JULY 28, 2019 (3)

U.S.

Outback Steakhouse

$

73,367

$

65,938

Carrabba’s Italian Grill

$

63,650

$

51,640

Bonefish Grill

$

62,118

$

55,334

Fleming’s Prime Steakhouse & Wine Bar

$

94,553

$

68,769

Combined U.S.

$

70,762

$

61,379

_________________
(1) For the four-week period June 28, 2021 through July 25, 2021 as compared to July 1, 2019 through July 28, 2019.
(2) For the four-week period June 28, 2021 through July 25, 2021 as compared to June 29, 2020 through July 26, 2020.
(3) For the four-week periods June 28, 2021 through July 25, 2021 and July 1, 2019 through July 28, 2019, respectively.

Recent Sales Results - Brazil

Brazil’s second quarter sales were impacted by a rise in COVID-19 cases that resulted in significantly reduced in-restaurant dining capacity for a majority of the country. In recent weeks as the vaccine rollout increased, we have seen in-restaurant dining capacity increase which has resulted in rapidly improving weekly sales volumes. In São Paulo, which represents our largest market with 46% of stores, in-restaurant dining capacity increased to 60% on July 7, 2021, providing optimism about the continued recovery.

The following tables include Brazil third quarter-to-date Company-owned comparable restaurant sales for the eight-week period ended July 25, 2021 and weekly comparable average unit volumes for the periods indicated:

EIGHT WEEKS ENDED

JULY 25, 2021

Comparable restaurant sales (stores open 18 months or more):

COMPARABLE TO 2019 (1)

COMPARABLE TO 2020 (2)

International

Outback Steakhouse - Brazil (3)

(7.9)

%

141.6

%

EIGHT WEEKS ENDED

Comparable restaurant average unit volumes (weekly):

JULY 25, 2021 (4)

JULY 28, 2019 (4)

International

Outback Steakhouse - Brazil (5)

$

59,222

$

64,816

________________
(1) For the eight-week period May 31, 2021 through July 25, 2021 as compared to June 3, 2019 through July 28, 2019.
(2) For the eight-week period May 31, 2021 through July 25, 2021 as compared to June 1, 2020 through July 26, 2020.
(3) Excludes the effect of fluctuations in foreign currency rates.
(4) For the eight-week periods May 31, 2021 through July 25, 2021 and June 3, 2019 through July 28, 2019, respectively.
(5) Translated at an average exchange rate of 5.09.

Q3 2021 Financial Outlook

The table below presents our expectations for selected fiscal Q3 2021 financial operating results. Our outlook assumes no significant business interruptions related to COVID-19 and contemplates the following considerations:

  • Continuing momentum in U.S. sales trends and includes a level of traditional Q3 seasonality; and
  • Achieving ongoing operating efficiencies from simplification efforts, waste reduction and lower advertising.

Selected Financial Data:

 

Q3 2021 Outlook

Total revenues

 

At least $1.015B

 

EBITDA (1)

 

At least $115M

 

GAAP diluted earnings per share (2)

 

At least $0.45

 

Adjusted diluted earnings per share (3)

 

At least $0.50

_________________
(1) See EBITDA outlook reconciliation later in this release.
(2) Assumes weighted average diluted shares of approximately 110 million, which includes the dilutive impact of shares issuable in excess of the convertible note principal and excludes the benefit of the convertible notes hedge.
(3) Assumes weighted average adjusted diluted shares of approximately 100 million, which excludes common shares to be issued upon conversion of the 2025 Notes for the amount in excess of the principal since our convertible note hedge offsets the dilutive impact of the shares underlying the 2025 Notes.

Fiscal 2021 Financial Outlook

We are updating our 2021 financial outlook for the following items:

  • Increased commodity inflation reflects increases in protein costs, primarily chicken and seafood, as we acquired additional supply outside of our contracted terms due to higher sales volumes;
  • Higher general and administrative expenses from additional incentive compensation as a result of strong financial performance; and
  • A reduction in capital expenditures due to raw material constraints delaying relocations, remodels and new restaurants into 2022.

All other aspects of our previously provided financial outlook remain unchanged. See the table below for more details.

       

Selected Financial Data:

Prior Outlook

Current Outlook

Commodity inflation

Flat

Approx. 1.0%

Labor inflation

3.0% - 3.5%

3.0% - 3.5%

General and administrative expenses

$225M - $230M

$240M - $245M

Depreciation and amortization

$165M - $175M

$165M - $175M

Capital expenditures

$170M - $185M

$140M - $150M

Number of new system-wide restaurants

20 - 25

20 - 25

We are not providing any additional sales or profit guidance for the full-year due to the ongoing uncertainties related to the COVID-19 pandemic.

About Bloomin’ Brands, Inc.

Bloomin’ Brands, Inc. is one of the largest casual dining restaurant companies in the world with a portfolio of leading, differentiated restaurant concepts. The Company has four founder-inspired brands: Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse & Wine Bar. The Company operates more than 1,450 restaurants in 47 states, Guam and 19 countries, some of which are franchise locations.

TABLE ONE

BLOOMIN’ BRANDS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

(in thousands, except per share data)

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Revenues

Restaurant sales

$

1,055,227

$

576,261

$

2,034,678

$

1,572,498

Franchise and other revenues

22,139

2,198

30,161

14,298

Total revenues

1,077,366

578,459

2,064,839

1,586,796

Costs and expenses

Food and beverage costs

312,102

180,758

603,972

500,451

Labor and other related

294,999

205,537

569,637

514,806

Other restaurant operating

233,450

177,846

462,743

424,401

Depreciation and amortization

40,539

45,784

81,765

94,052

General and administrative

66,462

55,487

123,710

140,289

Provision for impaired assets and restaurant closings

5,177

24,959

7,377

66,277

Total costs and expenses

952,729

690,371

1,849,204

1,740,276

Income (loss) from operations

124,637

(111,912)

215,635

(153,480)

Loss on extinguishment and modification of debt

(2,073)

(237)

(2,073)

(237)

Other income (expense), net

—

581

21

(212)

Interest expense, net

(14,990)

(16,639)

(29,618)

(28,347)

Income (loss) before provision (benefit) for income taxes

107,574

(128,207)

183,965

(182,276)

Provision (benefit) for income taxes

22,688

(35,779)

29,281

(55,434)

Net income (loss)

84,886

(92,428)

154,684

(126,842)

Less: net income (loss) attributable to noncontrolling interests

2,341

(172)

3,277

25

Net income (loss) attributable to Bloomin’ Brands

82,545

(92,256)

151,407

(126,867)

Redemption of preferred stock in excess of carrying value

—

—

—

(3,496)

Net income (loss) attributable to common stockholders

82,545

(92,256)

151,407

(130,363)

Convertible senior notes if-converted method interest adjustment, net of tax

—

—

691

—

Diluted net income (loss) attributable to common stockholders

$

82,545

$

(92,256)

$

152,098

$

(130,363)

Earnings (loss) per share attributable to common stockholders:

Basic

$

0.93

$

(1.05)

$

1.71

$

(1.49)

Diluted

$

0.75

$

(1.05)

$

1.38

$

(1.49)

Weighted average common shares outstanding:

Basic

89,075

87,496

88,721

87,312

Diluted

109,805

87,496

110,223

87,312

TABLE TWO

BLOOMIN’ BRANDS, INC.

SEGMENT RESULTS

(UNAUDITED)

(dollars in thousands)

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

U.S. Segment

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Revenues

Restaurant sales

$

990,293

$

536,767

$

1,890,352

$

1,421,656

Franchise and other revenues

12,765

313

17,624

9,921

Total revenues

$

1,003,058

$

537,080

$

1,907,976

$

1,431,577

Restaurant-level operating margin

21.7

%

3.2

%

20.5

%

8.4

%

Income (loss) from operations

$

165,297

$

(62,921)

$

287,032

$

(51,542)

Operating income (loss) margin

16.5

%

(11.7)

%

15.0

%

(3.6)

%

International Segment

Revenues

Restaurant sales

$

64,934

$

39,494

$

144,326

$

150,842

Franchise and other revenues (1)

9,374

1,885

12,537

4,377

Total revenues

$

74,308

$

41,379

$

156,863

$

155,219

Restaurant-level operating margin

3.2

%

(21.8)

%

9.3

%

8.0

%

Income (loss) from operations

$

2,470

$

(17,070)

$

6,007

$

(10,283)

Operating income (loss) margin

3.3

%

(41.3)

%

3.8

%

(6.6)

%

Reconciliation of Segment Income (Loss) from Operations to Consolidated Income (Loss) from Operations

Segment income (loss) from operations

U.S.

$

165,297

$

(62,921)

$

287,032

$

(51,542)

International

2,470

(17,070)

6,007

(10,283)

Total segment income (loss) from operations

167,767

(79,991)

293,039

(61,825)

Unallocated corporate operating expense (2)

(43,130)

(31,921)

(77,404)

(91,655)

Total income (loss) from operations

$

124,637

$

(111,912)

$

215,635

$

(153,480)

____________________
(1) During the thirteen and twenty-six weeks ended June 27, 2021, we recognized $6.3 million of other revenues in connection with favorable court rulings in Brazil regarding the calculation methodology and taxable base of Program of Social Integration (“PIS”) and Contribution for the Financing of Social Security (“COFINS”) taxes.
(2) The thirteen and twenty-six weeks ended June 28, 2020 include $2.4 million and $24.6 million, respectively, of charges that were not allocated to our segments related to our transformational initiatives.

TABLE THREE

BLOOMIN’ BRANDS, INC.

SUPPLEMENTAL BALANCE SHEET INFORMATION

(UNAUDITED)

(dollars in thousands)

JUNE 27, 2021

 

DECEMBER 27, 2020

Cash and cash equivalents

$

101,285

$

109,980

Net working capital (deficit) (1)

$

(666,393)

$

(626,250)

Total assets

$

3,246,753

$

3,362,107

Total debt, net

$

850,063

$

1,036,480

Total stockholders’ equity

$

152,907

$

10,957

_________________
(1) We have, and in the future may continue to have, negative working capital balances (as is common for many restaurant companies). We operate successfully with negative working capital because cash collected on Restaurant sales is typically received before payment is due on our current liabilities, and our inventory turnover rates require relatively low investment in inventories. Additionally, ongoing cash flows from restaurant operations and gift card sales are typically used to service debt obligations and to make capital expenditures.

TABLE FOUR

BLOOMIN’ BRANDS, INC.

RESTAURANT-LEVEL OPERATING MARGIN RECONCILIATIONS

(UNAUDITED)

Consolidated

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

(dollars in thousands)

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Income (loss) from operations

$

124,637

$

(111,912)

$

215,635

$

(153,480)

Operating income (loss) margin

11.6

%

(19.3)

%

10.4

%

(9.7)

%

Less:

Franchise and other revenues

22,139

2,198

30,161

14,298

Plus:

Depreciation and amortization

40,539

45,784

81,765

94,052

General and administrative

66,462

55,487

123,710

140,289

Provision for impaired assets and restaurant closings

5,177

24,959

7,377

66,277

Restaurant-level operating income

$

214,676

$

12,120

$

398,326

$

132,840

Restaurant-level operating margin

20.3

%

2.1

%

19.6

%

8.4

%

U.S.

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

(dollars in thousands)

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Income (loss) from operations

$

165,297

$

(62,921)

$

287,032

$

(51,542)

Operating income (loss) margin

16.5

%

(11.7)

%

15.0

%

(3.6)

%

Less:

Franchise and other revenues

12,765

313

17,624

9,921

Plus:

Depreciation and amortization

33,579

37,308

67,224

74,948

General and administrative

22,953

18,343

44,045

49,223

Provision for impaired assets and restaurant closings

5,676

24,781

7,139

56,475

Restaurant-level operating income

$

214,740

$

17,198

$

387,816

$

119,183

Restaurant-level operating margin

21.7

%

3.2

%

20.5

%

8.4

%

International

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

(dollars in thousands)

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Income (loss) from operations

$

2,470

$

(17,070)

$

6,007

$

(10,283)

Operating income (loss) margin

3.3

%

(41.3)

%

3.8

%

(6.6)

%

Less:

Franchise and other revenues

9,374

1,885

12,537

4,377

Plus:

Depreciation and amortization

5,565

5,884

11,285

12,642

General and administrative

4,116

4,146

8,721

10,402

Provision for impaired assets and restaurant closings

(708)

296

(1)

3,640

Restaurant-level operating income (loss)

$

2,069

$

(8,629)

$

13,475

$

12,024

Restaurant-level operating margin

3.2

%

(21.8)

%

9.3

%

8.0

%

TABLE FIVE

BLOOMIN’ BRANDS, INC.

RESTAURANT-LEVEL OPERATING MARGIN NON-GAAP RECONCILIATIONS

(UNAUDITED)

THIRTEEN WEEKS ENDED

FAVORABLE
(UNFAVORABLE)
CHANGE IN
ADJUSTED

QUARTER TO
DATE

JUNE 27, 2021

JUNE 28, 2020

Consolidated:

REPORTED

ADJUSTED

REPORTED

ADJUSTED (1)

Restaurant sales

100.0

%

100.0

%

100.0

%

100.0

%

Food and beverage costs

29.6

%

29.6

%

31.4

%

31.2

%

1.6

%

Labor and other related

28.0

%

28.0

%

35.7

%

35.7

%

7.7

%

Other restaurant operating

22.1

%

22.1

%

30.9

%

30.4

%

8.3

%

Restaurant-level operating margin (2)

20.3

%

20.3

%

2.1

%

2.7

%

17.6

%

Segments - Restaurant-level operating margin:

U.S. (2)

21.7

%

21.7

%

3.2

%

3.9

%

17.8

%

International (2)

3.2

%

3.2

%

(21.8)

%

(21.4)

%

24.6

%

TWENTY-SIX WEEKS ENDED

FAVORABLE (UNFAVORABLE) CHANGE IN ADJUSTED

YEAR TO DATE

JUNE 27, 2021

JUNE 28, 2020

Consolidated:

REPORTED

ADJUSTED

REPORTED

ADJUSTED (1)

Restaurant sales

100.0

%

100.0

%

100.0

%

100.0

%

Food and beverage costs

29.7

%

29.7

%

31.8

%

31.4

%

1.7

%

Labor and other related

28.0

%

28.0

%

32.7

%

32.7

%

4.7

%

Other restaurant operating

22.7

%

22.7

%

27.0

%

27.0

%

4.3

%

Restaurant-level operating margin (2)

19.6

%

19.6

%

8.4

%

8.9

%

10.7

%

Segments - Restaurant-level operating margin:

U.S. (2)

20.5

%

20.5

%

8.4

%

8.7

%

11.8

%

International (2)

9.3

%

9.3

%

8.0

%

9.3

%

—

%

_________________

(1)

The table set forth below titled “Restaurant-level Operating Margin Adjustments” provides additional information regarding the adjustments for each period presented.

(2)

The following categories of our revenue and operating expenses are not included in restaurant-level operating margin because we do not consider them reflective of operating performance at the restaurant-level within a period:

 

(a)

 

Franchise and other revenues, which are earned primarily from franchise royalties and other non-food and beverage revenue streams, such as rental and sublease income.

 

(b)

 

Depreciation and amortization which, although substantially all of which is related to restaurant-level assets, represent historical sunk costs rather than cash outlays for the restaurants.

 

(c)

 

General and administrative expense which includes primarily non-restaurant-level costs associated with support of the restaurants and other activities at our corporate offices.

 

(d)

 

Asset impairment charges and restaurant closing costs which are not reflective of ongoing restaurant performance in a period.

Restaurant-level Operating Margin Adjustments - Following is a summary of (favorable) unfavorable adjusted restaurant-level operating margin adjustments recorded in Other restaurant operating expense (unless otherwise noted below) for the following activities, as described in table six of this release for the periods indicated:

THIRTEEN WEEKS

TWENTY-SIX WEEKS

 

ENDED

 

ENDED

(dollars in millions)

JUNE 28, 2020

JUNE 28, 2020

COVID-19 related costs (1)

$

(3.7)

$

(9.9)

Restaurant relocations, asset impairments and closing costs

—

2.7

$

(3.7)

$

(7.2)

_________________
(1) Includes $1.2 million and $7.3 million of adjustments for the thirteen and twenty-six weeks ended June 28, 2020, respectively, recorded in Food and beverage costs, including $0.2 million and $2.0 million of adjustments, respectively, recorded in the international segment. All other adjustments were recorded within the U.S. segment.

TABLE SIX

BLOOMIN’ BRANDS, INC.

INCOME (LOSS) FROM OPERATIONS, NET INCOME (LOSS) AND DILUTED EARNINGS (LOSS) PER SHARE NON-GAAP RECONCILIATIONS

(UNAUDITED)

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

(in thousands, except per share data)

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Income (loss) from operations

$

124,637

$

(111,912)

$

215,635

$

(153,480)

Operating income (loss) margin

11.6

%

(19.3)

%

10.4

%

(9.7)

%

Adjustments:

Legal and other matters (1)

(6,337)

—

(6,337)

178

COVID-19-related costs (2)

—

30,342

—

79,218

Severance and other transformational costs (3)

—

2,415

—

24,647

Restaurant relocations, asset impairments and closing costs (4)

—

—

—

(2,205)

Total income (loss) from operations adjustments

(6,337)

32,757

(6,337)

101,838

Adjusted income (loss) from operations

$

118,300

$

(79,155)

$

209,298

$

(51,642)

Adjusted operating income (loss) margin

11.0

%

(13.7)

%

10.2

%

(3.3)

%

Diluted net income (loss) attributable to common stockholders

$

82,545

$

(92,256)

$

152,098

$

(130,363)

Convertible senior notes if-converted method interest
adjustment, net of tax (5)

—

—

691

—

Net income (loss) attributable to common stockholders

82,545

(92,256)

151,407

(130,363)

Adjustments:

Income (loss) from operations adjustments

(6,337)

32,757

(6,337)

101,838

Loss on extinguishment and modification of debt

2,073

—

2,073

—

Amortization of debt discount (6)

—

1,379

—

1,379

Total adjustments, before income taxes

(4,264)

34,136

(4,264)

103,217

Adjustment to provision for income taxes (7)

1,243

(6,474)

1,243

(28,469)

Redemption of preferred stock in excess of carrying value (8)

—

—

—

3,496

Net adjustments

(3,021)

27,662

(3,021)

78,244

Adjusted net income (loss)

$

79,524

$

(64,594)

$

148,386

$

(52,119)

Diluted earnings (loss) per share attributable to common stockholders (9)

$

0.75

$

(1.05)

$

1.38

$

(1.49)

Adjusted diluted earnings (loss) per share (9)(10)

$

0.81

$

(0.74)

$

1.53

$

(0.60)

Diluted weighted average common shares outstanding (9)

109,805

87,496

110,223

87,312

Adjusted diluted weighted average common shares outstanding (9)(10)

98,574

87,496

97,011

87,312

_________________
(1) The thirteen and twenty-six weeks ended June 27, 2021 includes the recognition of recoverable PIS and COFINS taxes, including accrued interest, within other revenues as a result of favorable court rulings in Brazil during the second quarter of 2021.
(2) Costs incurred in connection with the COVID-19 pandemic, primarily consisting of fixed asset and right-of-use asset impairments, restructuring charges, inventory obsolescence and spoilage,contingent lease liabilities and current expected credit losses.
(3) Severance, professional fees and other costs incurred as a result of transformational and restructuring activities.
(4) Includes asset impairment charges and accelerated depreciation incurred in connection with our relocation program and a lease termination gain of $2.8 million.
(5) Adjustment for interest expense related to our convertible senior notes (the “2025 Notes”) weighted for the portion of the period prior to our election under the 2025 Notes indenture to settle the principal portion of our 2025 Notes in cash. The calculation of adjusted diluted earnings per share excludes the 2025 Notes interest adjustment.
(6) Amortization of the debt discount related to the issuance of the 2025 Notes.
(7) Income tax effect of the adjustments for the periods presented.
(8) Consideration paid in excess of the carrying value for the redemption of preferred stock of our Abbraccio subsidiary.
(9) Due to the GAAP net loss, the effect of dilutive securities was excluded from the calculation of GAAP diluted loss per share for the thirteen and twenty-six weeks ended June 28, 2020.
(10) For the twenty-six weeks ended June 27, 2021, adjusted diluted weighted average common shares outstanding was calculated assuming our February 2021 election to settle the principal portion of the 2025 Notes in cash was in effect for the entire period. For the thirteen and twenty-six weeks ended June 27, 2021, adjusted diluted weighted average common shares outstanding was calculated excluding the dilutive effect of 11,231 and 10,442 shares, respectively, to be issued upon conversion of the 2025 Notes to satisfy the amount in excess of the principal since our convertible note hedge offsets the dilutive impact of the shares underlying the 2025 Notes.

Following is a summary of the financial statement line item classification of the net income (loss) adjustments:

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

(dollars in thousands)

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Franchise and other revenues

$

(6,337)

$

—

$

(6,337)

$

—

Food and beverage costs

—

1,163

—

7,345

Other restaurant operating

—

2,467

—

(176)

Depreciation and amortization

—

—

—

407

General and administrative

—

3,632

—

27,856

Provision for impaired assets and restaurant closings

—

25,495

—

66,406

Loss on extinguishment and modification of debt

2,073

—

2,073

—

Interest expense, net

—

1,379

—

1,379

Provision (benefit) for income taxes

1,243

(6,474)

1,243

(28,469)

Redemption of preferred stock in excess of carrying value

—

—

—

3,496

Net adjustments

$

(3,021)

$

27,662

$

(3,021)

$

78,244

TABLE SEVEN

BLOOMIN’ BRANDS, INC.

SEGMENT INCOME FROM OPERATIONS NON-GAAP RECONCILIATIONS

(UNAUDITED)

(dollars in thousands)

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

U.S. Segment

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Income (loss) from operations

$

165,297

$

(62,921)

$

287,032

$

(51,542)

Operating income (loss) margin

16.5

%

(11.7)

%

15.0

%

(3.6)

%

Adjustments:

COVID-19-related costs (1)

—

29,805

—

72,784

Restaurant relocations, asset impairments and closing costs (2)

—

—

—

(2,205)

Adjusted income (loss) from operations

$

165,297

$

(33,116)

$

287,032

$

19,037

Adjusted operating income (loss) margin

16.5

%

(6.2)

%

15.0

%

1.3

%

International Segment

Income (loss) from operations

$

2,470

$

(17,070)

$

6,007

$

(10,283)

Operating income (loss) margin

3.3

%

(41.3)

%

3.8

%

(6.6)

%

Adjustments:

Legal and other matters (3)

(6,337)

—

(6,337)

—

COVID-19 related costs (1)

—

459

—

5,651

Adjusted loss from operations

$

(3,867)

$

(16,611)

$

(330)

$

(4,632)

Adjusted operating loss margin

(5.7)

%

(40.1)

%

(0.2)

%

(3.0)

%

_________________
(1) Costs incurred in connection with the COVID-19 pandemic, primarily consisting of fixed asset and right-of-use asset impairments, restructuring charges, inventory obsolescence and spoilage, contingent lease liabilities and current expected credit losses.
(2) Includes asset impairment charges and accelerated depreciation incurred in connection with our relocation program and a lease termination gain of $2.8 million.
(3) Recognition of recoverable PIS and COFINS taxes, including accrued interest, within other revenues as a result of favorable court rulings in Brazil during the second quarter of 2021.

TABLE EIGHT

BLOOMIN’ BRANDS, INC.

COMPARATIVE RESTAURANT INFORMATION

(UNAUDITED)

Number of restaurants (at end of the period):

MARCH 28, 2021

OPENINGS

CLOSURES

JUNE 27, 2021

U.S.:

Outback Steakhouse

Company-owned

567

—

(1)

566

Franchised

131

—

—

131

Total

698

—

(1)

697

Carrabba’s Italian Grill

Company-owned

199

—

—

199

Franchised

21

—

(1)

20

Total

220

—

(1)

219

Bonefish Grill

Company-owned

180

—

(1)

179

Franchised

7

—

—

7

Total

187

—

(1)

186

Fleming’s Prime Steakhouse & Wine Bar

Company-owned

64

—

—

64

Other

Company-owned (1)

6

2

—

8

U.S. total

1,175

2

(3)

1,174

International:

Company-owned

Outback Steakhouse - Brazil (2)

110

3

—

113

Other (1)(3)

34

—

—

34

Franchised

Outback Steakhouse—South Korea (3)

100

9

(1)

108

Other (1)

57

—

(2)

55

International total

301

12

(3)

310

System-wide total

1,476

14

(6)

1,484

____________________
(1) U.S. Company-owned and International Franchised Other includes four and three fast-casual Aussie Grill locations as of June 27, 2021. International Company-owned Other includes two fast-casual Aussie Grill locations as of June 27, 2021.
(2) The restaurant counts for Brazil are reported as of February 28, 2021 and May 31, 2021, respectively, to correspond with the balance sheet dates of this subsidiary.
(3) As of June 27, 2021, we had 32 international dark kitchens that offer delivery only included in Franchised Outback Steakhouse - South Korea. In addition, we had one international dark kitchen location included within Company-owned Other as of June 27, 2021.

TABLE NINE

BLOOMIN’ BRANDS, INC.

COMPARABLE RESTAURANT SALES INFORMATION

(UNAUDITED)

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

JUNE 27, 2021

JUNE 28, 2020

JUNE 27, 2021

JUNE 28, 2020

Comparable to
2019 (1)

Comparable to
2020

Comparable to
2019

Comparable to
2019 (1)

Comparable to
2020

Comparable to
2019

Year over year percentage change:

Comparable restaurant sales (stores open 18 months or more):

U.S. (2)

Outback Steakhouse

11.3

%

65.8

%

(32.9)

%

2.3

%

28.8

%

(20.6)

%

Carrabba’s Italian Grill

16.7

%

84.3

%

(36.7)

%

7.7

%

38.4

%

(22.2)

%

Bonefish Grill

4.2

%

141.2

%

(56.8)

%

(6.3)

%

43.5

%

(34.7)

%

Fleming’s Prime Steakhouse &
Wine Bar

24.4

%

182.6

%

(56.3)

%

3.6

%

55.6

%

(33.6)

%

Combined U.S.

12.1

%

84.6

%

(39.4)

%

1.9

%

34.4

%

(24.2)

%

International

Outback Steakhouse - Brazil (3)

(36.3)

%

78.8

%

(63.9)

%

(26.2)

%

2.7

%

(27.4)

%

Traffic:

U.S.

Outback Steakhouse

4.4

%

51.4

%

(31.0)

%

(2.7)

%

21.9

%

(20.2)

%

Carrabba’s Italian Grill

13.0

%

57.2

%

(28.1)

%

5.8

%

27.0

%

(16.7)

%

Bonefish Grill

3.9

%

52.4

%

(29.8)

%

(4.7)

%

22.4

%

(20.6)

%

Fleming’s Prime Steakhouse & Wine Bar

11.9

%

97.0

%

(43.5)

%

(3.5)

%

33.5

%

(28.0)

%

Combined U.S.

6.2

%

53.6

%

(30.6)

%

(1.4)

%

23.2

%

(19.8)

%

International

Outback Steakhouse - Brazil

(20.3)

%

63.0

%

(48.5)

%

(13.6)

%

8.9

%

(19.0)

%

Average check per person (4):

U.S.

Outback Steakhouse

6.9

%

14.4

%

(1.9)

%

5.0

%

6.9

%

(0.4)

%

Carrabba’s Italian Grill

3.7

%

27.1

%

(8.6)

%

1.9

%

11.4

%

(5.5)

%

Bonefish Grill

0.3

%

88.8

%

(27.0)

%

(1.6)

%

21.1

%

(14.1)

%

Fleming’s Prime Steakhouse & Wine Bar

12.5

%

85.6

%

(12.8)

%

7.1

%

22.1

%

(5.6)

%

Combined U.S.

5.9

%

31.0

%

(8.8)

%

3.3

%

11.2

%

(4.4)

%

International

Outback Steakhouse - Brazil

(15.8)

%

22.2

%

(15.2)

%

(12.4)

%

(4.5)

%

(8.4)

%

____________________
(1) Represents comparable restaurant sales, traffic and average check per person increases (decreases) relative to fiscal year 2019 for improved comparability due to the impact of COVID-19 on fiscal year 2020 restaurant sales.
(2) Relocated restaurants closed more than 60 days are excluded from comparable restaurant sales until at least 18 months after reopening.
(3) Excludes the effect of fluctuations in foreign currency rates. Includes trading day impact from calendar period reporting.
(4) Average check per person includes the impact of menu pricing changes, product mix and discounts.

TABLE TEN

BLOOMIN’ BRANDS, INC.

EBITDA RECONCILIATIONS

(UNAUDITED)

THIRTEEN WEEKS ENDED

TWENTY-SIX WEEKS ENDED

(dollars in thousands)

JUNE 27, 2021

JUNE 27, 2021

Net income attributable to common stockholders

$

82,545

$

151,407

Provision for income taxes

22,688

29,281

Interest expense, net

14,990

29,618

Depreciation and amortization

40,539

81,765

EBITDA

$

160,762

$

292,071

TABLE ELEVEN

BLOOMIN’ BRANDS, INC.

FISCAL 2021 THIRD QUARTER EBITDA OUTLOOK RECONCILIATION

(UNAUDITED)

(dollars in millions)

Net income attributable to common stockholders

At least $50M

Provision for income taxes

At least $10M

Interest expense, net

At least $14M

Depreciation and amortization

At least $41M

EBITDA

At least $115M

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