Bloomin’ Brands Announces 2021 Q4 Financial Results with Strong Operating Margin Expansion
Q4 Comparable Restaurant Sales Growth of 20.7% at Outback Steakhouse and 27.9% Combined U.S.
Bloomin’ Brands, Inc. (Nasdaq: BLMN) reported results for the fourth quarter 2021 (“Q4 2021”) and fiscal year ended December 26, 2021 compared to the fourth quarter 2020 (“Q4 2020”) and fiscal year ended December 27, 2020.
CEO Comments
“Q4 was another quarter of strong results with significant sales, margin and earnings growth,” said David Deno, Chief Executive Officer. “Over the past year we executed against our strategy resulting in sustained gains in off-premises, higher digital engagement, and improved operational efficiencies in the restaurants. As we move into 2022 we are well positioned to deliver on our long-term goals of growing sales and maximizing total shareholder return.”
Diluted EPS and Adjusted Diluted EPS
The following tables reconcile Diluted earnings (loss) per share attributable to common stockholders to Adjusted diluted earnings (loss) per share for the periods indicated:
| Q4 | |||||||||
| 2021 | 2020 | CHANGE | Q4 2019 (1) | ||||||
| Diluted earnings (loss) per share attributable to common stockholders | $ 0.59 | $ (0.16) | $ 0.75 | $ 0.32 | |||||
| Adjustments (2) | 0.01 | 0.18 | (0.17) | — | |||||
| Adjusted diluted earnings per share (2) | $ 0.60 | $ 0.02 | $ 0.58 | $ 0.32 | |||||
| FISCAL YEAR | FISCAL YEAR | ||||||||
| 2021 | 2020 | CHANGE | 2019 (1) | ||||||
| Diluted earnings (loss) per share attributable to common stockholders | $ 2.00 | $ (1.85) | $ 3.85 | $ 1.45 | |||||
| Adjustments (2)(3) | 0.70 | 1.16 | (0.46) | 0.09 | |||||
| Adjusted diluted earnings (loss) per share (2)(3) | $ 2.70 | $ (0.69) | $ 3.39 | $ 1.54 | |||||
| __________ | |||||||||
| (1) Presented for improved comparability. | |||||||||
Fourth Quarter Financial Results
| (dollars in millions) | Q4 2021 | Q4 2020 | CHANGE | Q4 2019 (1) | ||||
| Total revenues | $ 1,047.1 | $ 812.5 | 28.9 % | $ 1,022.2 | ||||
| Restaurant-level operating margin | 16.5 % | 11.8 % | 4.7 % | 14.4 % | ||||
| Adjusted restaurant-level operating margin (2) | 16.5 % | 12.4 % | 4.1 % | 13.9 % | ||||
| Operating income (loss) margin | 7.5 % | (0.9) % | 8.4 % | 4.2 % | ||||
| Adjusted operating income margin (2) | 7.8 % | 1.3 % | 6.5 % | 4.2 % | ||||
| ____________ | ||||||||
| (1) Presented for improved comparability. |
- The increase in Total revenues was primarily due to: (i) higher comparable restaurant sales from recovery of in-restaurant dining from the significantly reduced levels in 2020 after the onset of the pandemic and strong retention of off-premises sales, (ii) higher franchise revenues and (iii) the net impact of restaurant openings and closures.
- Restaurant-level operating margin increased primarily due to higher comparable restaurant sales from in-restaurant dining and strong retention of off-premises sales, and higher franchise revenues. These increases were partially offset by higher labor costs and commodity inflation and higher utilities, operating and rent expense.
- Operating income margin increased due to an increase in restaurant-level operating margin as described above and 2020 asset impairment charges related to the COVID-19 pandemic. Adjusted operating income excludes the impact of charges related to the COVID-19 pandemic.
Fourth Quarter Comparable Restaurant Sales
Fourth quarter U.S. comparable restaurant sales results increased 27.9% versus 2020 and 5.3% on a two-year basis given strong retention of off-premises sales. During the quarter we chose not to replicate the significant promotional activity from 2019 at Outback Steakhouse given the evolving consumer environment. As expected, we saw a significant increase in Outback Steakhouse comparable restaurant sales once we lapped this activity in mid-November.
The following table includes Company-owned comparable restaurant sales for the fourth quarter ended December 26, 2021 relative to 2019 and 2020:
| THIRTEEN WEEKS ENDED | |||
| DECEMBER 26, 2021 | |||
| Comparable restaurant sales (stores open 18 months or more): | COMPARABLE TO 2019 (1) | COMPARABLE TO 2020 | |
| U.S. | |||
| Outback Steakhouse | 2.5 % | 20.7 % | |
| Carrabba’s Italian Grill | 10.3 % | 24.4 % | |
| Bonefish Grill | 1.3 % | 39.0 % | |
| Fleming’s Prime Steakhouse & Wine Bar | 20.3 % | 71.1 % | |
| Combined U.S. | 5.3 % | 27.9 % | |
| International | |||
| Outback Steakhouse - Brazil (2) | 8.5 % | 26.5 % | |
| __________ | |||
| (1) Represents comparable restaurant sales increases relative to 2019 for improved comparability due to the impact of COVID-19 on fiscal year 2020 restaurant sales. | |||
Reinstated Quarterly Dividend and Share Repurchase Authorization
On February 8, 2022, our Board of Directors reinstated a quarterly dividend and declared a quarterly cash dividend of $0.14 per share to be paid on March 16, 2022 to all stockholders of record as of the close of business on March 2, 2022.
On February 8, 2022, our Board of Directors approved a $125 million share repurchase program. This authorization will expire on August 9, 2023.
Fiscal 2022 Financial Outlook
The tables below present our expectations for selected 2022 financial reporting and operating results. Our outlook assumes no additional significant business interruptions related to COVID-19:
| Financial Results: | 2022 Guidance | |
| Total revenues | $4.30B to $4.35B | |
| EBITDA (1) | $495M to $515M | |
| GAAP diluted earnings per share (2) | $2.13 to $2.22 | |
| Adjusted diluted earnings per share (3) | $2.35 to $2.45 | |
| Effective income tax rate | 16% to 17% | |
| Other Selected Financial Data: | 2022 Guidance | |
| Commodity inflation | 11% to 13% | |
| Labor inflation | High single digits | |
| Capital expenditures | $225M - $240M | |
| Number of new system-wide restaurants | Approx. 30 | |
| __________ | ||
| (1) See EBITDA outlook reconciliation later in this release. |
Q1 2022 Financial Outlook
The table below presents our expectations for selected fiscal Q1 2022 operating results. Our outlook assumes no additional business interruptions related to COVID-19:
| Selected Financial Data: | Q1 2022 Outlook | |
| Total revenues | $1.10B to $1.135B | |
| GAAP diluted earnings per share (1) | $0.64 to $0.69 | |
| Adjusted diluted earnings per share (2) | $0.70 to $0.75 | |
| __________ | ||
| (1) For GAAP purposes assumes weighted-average diluted shares of approximately 104 million. | ||
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 full-service restaurants and off-premises only kitchens in 47 states, Guam and 17 countries, some of which are franchise locations.
| TABLE ONE | |||||||
| BLOOMIN’ BRANDS, INC. | |||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
| THIRTEEN WEEKS ENDED | FISCAL YEAR | ||||||
| (in thousands, except per share data) | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| (UNAUDITED) | (UNAUDITED) | (UNAUDITED) | |||||
| Revenues | |||||||
| Restaurant sales | $ 1,029,697 | $ 805,651 | $ 4,061,093 | $ 3,144,636 | |||
| Franchise and other revenues | 17,386 | 6,854 | 61,292 | 25,925 | |||
| Total revenues | 1,047,083 | 812,505 | 4,122,385 | 3,170,561 | |||
| Costs and expenses | |||||||
| Food and beverage costs | 321,417 | 251,704 | 1,229,689 | 982,702 | |||
| Labor and other related | 294,740 | 243,628 | 1,154,623 | 1,005,295 | |||
| Other restaurant operating | 243,840 | 214,864 | 1,006,371 | 846,566 | |||
| Depreciation and amortization | 40,799 | 42,792 | 163,391 | 180,261 | |||
| General and administrative | 63,026 | 56,624 | 245,616 | 254,356 | |||
| Provision for impaired assets and restaurant closings | 4,775 | 10,131 | 13,737 | 76,354 | |||
| Total costs and expenses | 968,597 | 819,743 | 3,813,427 | 3,345,534 | |||
| Income (loss) from operations | 78,486 | (7,238) | 308,958 | (174,973) | |||
| Loss on extinguishment and modification of debt | — | — | (2,073) | (237) | |||
| Other income, net | — | 342 | 26 | 131 | |||
| Interest expense, net | (13,751) | (17,795) | (57,614) | (64,442) | |||
| Income (loss) before provision (benefit) for income taxes | 64,735 | (24,691) | 249,297 | (239,521) | |||
| Provision (benefit) for income taxes | 1,557 | (10,516) | 26,384 | (80,726) | |||
| Net income (loss) | 63,178 | (14,175) | 222,913 | (158,795) | |||
| Less: net income (loss) attributable to noncontrolling interests | 2,479 | 36 | 7,358 | (80) | |||
| Net income (loss) attributable to Bloomin’ Brands | 60,699 | (14,211) | 215,555 | (158,715) | |||
| Redemption of preferred stock in excess of carrying value | — | — | — | (3,496) | |||
| Net income (loss) attributable to common stockholders | 60,699 | (14,211) | 215,555 | (162,211) | |||
| Convertible senior notes if-converted method interest adjustment, net of tax | — | — | 345 | — | |||
| Diluted net income (loss) attributable to common stockholders | $ 60,699 | $ (14,211) | $ 215,900 | $ (162,211) | |||
| Earnings (loss) per share attributable to common stockholders: | |||||||
| Basic | $ 0.68 | $ (0.16) | $ 2.42 | $ (1.85) | |||
| Diluted | $ 0.59 | $ (0.16) | $ 2.00 | $ (1.85) | |||
| Weighted average common shares outstanding: | |||||||
| Basic | 89,251 | 87,689 | 88,981 | 87,468 | |||
| Diluted | 102,985 | 87,689 | 107,803 | 87,468 | |||
| TABLE TWO | |||||||
| BLOOMIN’ BRANDS, INC. | |||||||
| SEGMENT RESULTS | |||||||
| (UNAUDITED) | |||||||
| (dollars in thousands) | THIRTEEN WEEKS ENDED | FISCAL YEAR | |||||
| U.S. Segment | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| Revenues | |||||||
| Restaurant sales | $ 925,706 | $ 728,485 | $ 3,714,848 | $ 2,869,547 | |||
| Franchise and other revenues | 13,566 | 3,742 | 45,133 | 15,995 | |||
| Total revenues | $ 939,272 | $ 732,227 | $ 3,759,981 | $ 2,885,542 | |||
| Restaurant-level operating margin | 16.9 % | 11.1 % | 17.1 % | 9.8 % | |||
| Income (loss) from operations | $ 109,561 | $ 20,338 | $ 443,887 | $ (1,630) | |||
| Operating income (loss) margin | 11.7 % | 2.8 % | 11.8 % | (0.1) % | |||
| International Segment | |||||||
| Revenues | |||||||
| Restaurant sales | $ 103,991 | $ 77,166 | $ 346,245 | $ 275,089 | |||
| Franchise and other revenues (1) | 3,820 | 3,112 | 16,159 | 9,930 | |||
| Total revenues | $ 107,811 | $ 80,278 | $ 362,404 | $ 285,019 | |||
| Restaurant-level operating margin | 17.2 % | 14.9 % | 12.7 % | 8.3 % | |||
| Income (loss) from operations | $ 9,238 | $ 4,730 | $ 16,657 | $ (13,479) | |||
| Operating income (loss) margin | 8.6 % | 5.9 % | 4.6 % | (4.7) % | |||
| Reconciliation of Segment Income (Loss) | |||||||
| Segment income (loss) from operations | |||||||
| U.S. | $ 109,561 | $ 20,338 | $ 443,887 | $ (1,630) | |||
| International | 9,238 | 4,730 | 16,657 | (13,479) | |||
| Total segment income (loss) from operations | 118,799 | 25,068 | 460,544 | (15,109) | |||
| Unallocated corporate operating expense (2) | (40,313) | (32,306) | (151,586) | (159,864) | |||
| Total income (loss) from operations | $ 78,486 | $ (7,238) | $ 308,958 | $ (174,973) | |||
| __________ | |||||||
| (1) Fiscal year 2021 includes a $3.1 million benefit from the recognition of recoverable Program of Social Integration (“PIS”) and Contribution for the Financing of Social Security (“COFINS”) taxes, including accrued interest within other revenues in connection with favorable court rulings in Brazil regarding the calculation methodology and taxable base. | |||||||
| TABLE THREE | |||
| BLOOMIN’ BRANDS, INC. | |||
| SUPPLEMENTAL BALANCE SHEET INFORMATION | |||
| DECEMBER 26, 2021 | DECEMBER 27, 2020 | ||
| (dollars in thousands) | (UNAUDITED) | ||
| Cash and cash equivalents | $ 87,585 | $ 109,980 | |
| Net working capital (deficit) (1) | $ (631,833) | $ (626,250) | |
| Total assets | $ 3,294,271 | $ 3,362,107 | |
| Total debt, net | $ 793,065 | $ 1,036,480 | |
| Total stockholders’ equity | $ 222,850 | $ 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 | FISCAL YEAR | |||||
| (dollars in thousands) | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| Income (loss) from operations | $ 78,486 | $ (7,238) | $ 308,958 | $ (174,973) | |||
| Operating income (loss) margin | 7.5 % | (0.9) % | 7.5 % | (5.5) % | |||
| Less: | |||||||
| Franchise and other revenues | 17,386 | 6,854 | 61,292 | 25,925 | |||
| Plus: | |||||||
| Depreciation and amortization | 40,799 | 42,792 | 163,391 | 180,261 | |||
| General and administrative | 63,026 | 56,624 | 245,616 | 254,356 | |||
| Provision for impaired assets and restaurant closings | 4,775 | 10,131 | 13,737 | 76,354 | |||
| Restaurant-level operating income | $ 169,700 | $ 95,455 | $ 670,410 | $ 310,073 | |||
| Restaurant-level operating margin | 16.5 % | 11.8 % | 16.5 % | 9.9 % | |||
| U.S. | THIRTEEN WEEKS ENDED | FISCAL YEAR | |||||
| (dollars in thousands) | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| Income (loss) from operations | $ 109,561 | $ 20,338 | $ 443,887 | $ (1,630) | |||
| Operating income (loss) margin | 11.7 % | 2.8 % | 11.8 % | (0.1) % | |||
| Less: | |||||||
| Franchise and other revenues | 13,566 | 3,742 | 45,133 | 15,995 | |||
| Plus: | |||||||
| Depreciation and amortization | 33,599 | 34,293 | 134,244 | 144,298 | |||
| General and administrative | 23,271 | 19,581 | 89,314 | 88,536 | |||
| Provision for impaired assets and restaurant closings | 3,690 | 10,098 | 12,368 | 66,487 | |||
| Restaurant-level operating income | $ 156,555 | $ 80,568 | $ 634,680 | $ 281,696 | |||
| Restaurant-level operating margin | 16.9 % | 11.1 % | 17.1 % | 9.8 % | |||
| International | THIRTEEN WEEKS ENDED | FISCAL YEAR | |||||
| (dollars in thousands) | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| Income (loss) from operations | $ 9,238 | $ 4,730 | $ 16,657 | $ (13,479) | |||
| Operating income (loss) margin | 8.6 % | 5.9 % | 4.6 % | (4.7) % | |||
| Less: | |||||||
| Franchise and other revenues | 3,820 | 3,112 | 16,159 | 9,930 | |||
| Plus: | |||||||
| Depreciation and amortization | 5,522 | 5,408 | 22,650 | 23,722 | |||
| General and administrative | 5,898 | 4,503 | 19,679 | 18,916 | |||
| Provision for impaired assets and restaurant closings | 1,073 | — | 1,100 | 3,640 | |||
| Restaurant-level operating income | $ 17,911 | $ 11,529 | $ 43,927 | $ 22,869 | |||
| Restaurant-level operating margin | 17.2 % | 14.9 % | 12.7 % | 8.3 % | |||
| TABLE FIVE | |||||||||
| BLOOMIN’ BRANDS, INC. | |||||||||
| RESTAURANT-LEVEL OPERATING MARGIN NON-GAAP RECONCILIATIONS | |||||||||
| (UNAUDITED) | |||||||||
| THIRTEEN WEEKS ENDED | (UNFAVORABLE) QUARTER TO | ||||||||
| DECEMBER 26, 2021 | DECEMBER 27, 2020 | ||||||||
| Consolidated: | REPORTED | ADJUSTED | REPORTED | ADJUSTED (1) | |||||
| Restaurant sales | 100.0 % | 100.0 % | 100.0 % | 100.0 % | |||||
| Food and beverage costs | 31.2 % | 31.2 % | 31.2 % | 30.8 % | (0.4) % | ||||
| Labor and other related | 28.6 % | 28.6 % | 30.2 % | 30.2 % | 1.6 % | ||||
| Other restaurant operating | 23.7 % | 23.7 % | 26.7 % | 26.6 % | 2.9 % | ||||
| Restaurant-level operating margin (2) | 16.5 % | 16.5 % | 11.8 % | 12.4 % | 4.1 % | ||||
| Segments - Restaurant-level operating margin: | |||||||||
| U.S. (2) | 16.9 % | 16.9 % | 11.1 % | 11.7 % | 5.2 % | ||||
| International (2) | 17.2 % | 17.2 % | 14.9 % | 14.9 % | 2.3 % | ||||
| FISCAL YEAR | FAVORABLE YEAR TO DATE | ||||||||
| 2021 | 2020 | ||||||||
| Consolidated: | REPORTED | ADJUSTED (1) | REPORTED | ADJUSTED (1) | |||||
| Restaurant sales | 100.0 % | 100.0 % | 100.0 % | 100.0 % | |||||
| Food and beverage costs | 30.3 % | 30.3 % | 31.3 % | 30.9 % | 0.6 % | ||||
| Labor and other related | 28.4 % | 28.4 % | 32.0 % | 32.0 % | 3.6 % | ||||
| Other restaurant operating | 24.8 % | 23.2 % | 26.9 % | 26.9 % | 3.7 % | ||||
| Restaurant-level operating margin (2) | 16.5 % | 18.1 % | 9.9 % | 10.2 % | 7.9 % | ||||
| Segments - Restaurant-level operating margin: | |||||||||
| U.S. (2) | 17.1 % | 18.8 % | 9.8 % | 10.2 % | 8.6 % | ||||
| International (2) | 12.7 % | 13.5 % | 8.3 % | 9.0 % | 4.5 % | ||||
| __________ | |||||||||
| (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 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 ENDED | FISCAL YEAR | ||||
| (dollars in millions) | DECEMBER 27, 2020 | 2021 | 2020 | ||
| Royalty termination expense | $ — | $ (61.9) | $ — | ||
| Legal and other matters (i) | — | (2.7) | — | ||
| COVID-19 related costs (ii) | (4.5) | — | (14.3) | ||
| Asset impairments and closing costs | — | — | 2.7 | ||
| $ (4.5) | $ (64.6) | $ (11.6) | |||
| ___________ | |||||
| (i) Adjustment recorded within the international segment. | |||||
| (ii) Includes $3.7 million and $11.0 million of adjustments recorded in Food and beverage costs during the thirteen weeks and fiscal year ended December 27, 2020, respectively, including $2.0 million of adjustments recorded in the international segment during fiscal year ended December 27, 2020. 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 | FISCAL YEAR | ||||||
| (in thousands, except per share data) | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| Income (loss) from operations | $ 78,486 | $ (7,238) | $ 308,958 | $ (174,973) | |||
| Operating income (loss) margin | 7.5 % | (0.9) % | 7.5 % | (5.5) % | |||
| Adjustments: | |||||||
| Severance and other transformational costs (1) | 2,764 | 3,557 | 2,764 | 32,404 | |||
| Royalty termination expense (2) | — | — | 61,880 | — | |||
| Legal and other matters (3) | — | — | (372) | 178 | |||
| COVID-19-related costs (4) | — | 14,593 | — | 93,811 | |||
| Asset impairments and closure costs (5) | — | — | — | (2,205) | |||
| Total income (loss) from operations adjustments | 2,764 | 18,150 | 64,272 | 124,188 | |||
| Adjusted income (loss) from operations | $ 81,250 | $ 10,912 | $ 373,230 | $ (50,785) | |||
| Adjusted operating income (loss) margin | 7.8 % | 1.3 % | 9.1 % | (1.6) % | |||
| Diluted net income (loss) attributable to common stockholders | $ 60,699 | $ (14,211) | $ 215,900 | $ (162,211) | |||
| Convertible senior notes if-converted method interest adjustment, net of tax (6) | — | — | 345 | — | |||
| Net income (loss) attributable to common stockholders | 60,699 | (14,211) | 215,555 | (162,211) | |||
| Adjustments: | |||||||
| Income (loss) from operations adjustments | 2,764 | 18,150 | 64,272 | 124,188 | |||
| Loss on extinguishment and modification of debt | — | — | 2,073 | — | |||
| Amortization of debt discount (7) | — | 2,489 | — | 6,275 | |||
| Total adjustments, before income taxes | 2,764 | 20,639 | 66,345 | 130,463 | |||
| Adjustment to provision for income taxes (8) | (6,587) | (4,497) | (21,222) | (32,526) | |||
| Redemption of preferred stock in excess of carrying value (9) | — | — | — | 3,496 | |||
| Net adjustments | (3,823) | 16,142 | 45,123 | 101,433 | |||
| Adjusted net income (loss) | $ 56,876 | $ 1,931 | $ 260,678 | $ (60,778) | |||
| Diluted earnings (loss) per share attributable to common stockholders (10) | $ 0.59 | $ (0.16) | $ 2.00 | $ (1.85) | |||
| Adjusted diluted earnings (loss) per share (10)(11) | $ 0.60 | $ 0.02 | $ 2.70 | $ (0.69) | |||
| Diluted weighted average common shares outstanding (10) | 102,985 | 88,393 | 107,803 | 87,468 | |||
| Adjusted diluted weighted average common shares outstanding (11) | 94,375 | 88,393 | 96,426 | 87,468 | |||
| ____________ | |||||||
| (1) Severance, professional fees and other costs incurred as a result of transformational and restructuring activities. (2) Payment made to the founders of our Carrabba’s Italian Grill concept in connection with an agreement to terminate future royalty payments. (3) For 2021, includes: (i) a $3.1 million benefit from the recognition of recoverable PIS and COFINS taxes, including accrued interest, within other revenues as a result of favorable court rulings and (ii) an accrual of $2.7 million for Imposto sobre Serviços (“ISS”), a Brazilian municipal service tax, in connection with royalties from our Brazilian subsidiary over the past five years, including related penalties and interest, recorded within Other restaurant operating expense as a result of an unfavorable Brazilian Supreme Court ruling. (4) 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. (5) Primarily includes a lease termination gain of $2.8 million. (6) 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. (7) Amortization of debt discount related to the issuance of the 2025 Notes. (8) Income tax effect of the adjustments for the periods presented. Also includes a $4.2 million adjustment during the thirteen weeks and fiscal year ended December 26, 2021 for the reduction of certain unrecognized tax benefits related to tax positions taken during a prior period. (9) Consideration paid in excess of the carrying value for the redemption of preferred stock of our Abbraccio concept. (10) 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 weeks and fiscal year ended December 27, 2020. For adjusted diluted earnings per share, the calculation included dilutive shares of 476 and 228 related to stock-based compensation and outstanding warrants, respectively, for the thirteen weeks ended December 27, 2020. However, we excluded from our adjusted diluted shares outstanding calculation the dilutive impact of the convertible notes based on the bond hedge contracts in place that will deliver shares to offset the dilution. (11) For fiscal year 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 fiscal year. For the thirteen weeks and fiscal year ended December 26, 2021, adjusted diluted weighted average common shares outstanding was calculated excluding the dilutive effect of 8,610 and 9,992 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 | FISCAL YEAR | ||||||
| (dollars in thousands) | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| Franchise and other revenues | $ — | $ — | $ (3,133) | $ — | |||
| Food and beverage costs | — | 3,703 | — | 11,048 | |||
| Other restaurant operating | — | 752 | 64,641 | 576 | |||
| Depreciation and amortization | — | — | — | 407 | |||
| General and administrative | 2,764 | 3,652 | 2,764 | 35,708 | |||
| Provision for impaired assets and restaurant closings | — | 10,043 | — | 76,449 | |||
| Loss on extinguishment and modification of debt | — | — | 2,073 | — | |||
| Interest expense, net | — | 2,489 | — | 6,275 | |||
| Provision (benefit) for income taxes | (6,587) | (4,497) | (21,222) | (32,526) | |||
| Redemption of preferred stock in excess of carrying value | — | — | — | 3,496 | |||
| Net adjustments | $ (3,823) | $ 16,142 | $ 45,123 | $ 101,433 | |||
| TABLE SEVEN | |||||||
| BLOOMIN’ BRANDS, INC. | |||||||
| SEGMENT INCOME (LOSS) FROM OPERATIONS NON-GAAP RECONCILIATIONS | |||||||
| (UNAUDITED) | |||||||
| (dollars in thousands) | THIRTEEN WEEKS ENDED | FISCAL YEAR | |||||
| U.S. Segment | DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | |||
| Income (loss) from operations | $ 109,561 | $ 20,338 | $ 443,887 | $ (1,630) | |||
| Operating income (loss) margin | 11.7 % | 2.8 % | 11.8 % | (0.1) % | |||
| Adjustments: | |||||||
| Severance | 1,108 | — | 1,108 | — | |||
| Royalty agreement termination (1) | — | — | 61,880 | — | |||
| COVID-19-related costs (2) | — | 14,593 | — | 87,377 | |||
| Asset impairments and closure costs (3) | — | — | — | (2,205) | |||
| Adjusted income from operations | $ 110,669 | $ 34,931 | $ 506,875 | $ 83,542 | |||
| Adjusted operating income margin | 11.8 % | 4.8 % | 13.5 % | 2.9 % | |||
| International Segment | |||||||
| Income (loss) from operations | $ 9,238 | $ 4,730 | $ 16,657 | $ (13,479) | |||
| Operating income (loss) margin | 8.6 % | 5.9 % | 4.6 % | (4.7) % | |||
| Adjustments: | |||||||
| Legal and other matters | — | — | (372) | — | |||
| COVID-19 related costs (2) | — | — | — | 5,651 | |||
| Adjusted income (loss) from operations | $ 9,238 | $ 4,730 | $ 16,285 | $ (7,828) | |||
| Adjusted operating income (loss) margin | 8.6 % | 5.9 % | 4.5 % | (2.7) % | |||
| ___________ | |||||||
| (1) Payment made to the founders of our Carrabba’s Italian Grill concept in connection with an agreement to terminate future royalty payments. (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) Primarily includes a lease termination gain of $2.8 million. | |||||||
| TABLE EIGHT | |||||||
| BLOOMIN’ BRANDS, INC. | |||||||
| COMPARATIVE RESTAURANT AND OFF-PREMISES ONLY KITCHEN INFORMATION | |||||||
| (UNAUDITED) | |||||||
| Number of restaurants: | SEPTEMBER 26, | OPENINGS | CLOSURES | DECEMBER 26, | |||
| U.S.: | |||||||
| Outback Steakhouse | |||||||
| Company-owned | 564 | 1 | (1) | 564 | |||
| Franchised | 130 | — | — | 130 | |||
| Total | 694 | 1 | (1) | 694 | |||
| Carrabba’s Italian Grill | |||||||
| Company-owned | 199 | — | — | 199 | |||
| Franchised | 20 | — | — | 20 | |||
| Total | 219 | — | — | 219 | |||
| Bonefish Grill | |||||||
| Company-owned | 178 | — | — | 178 | |||
| Franchised | 7 | — | — | 7 | |||
| Total | 185 | — | — | 185 | |||
| Fleming’s Prime Steakhouse & Wine Bar | |||||||
| Company-owned | 64 | — | — | 64 | |||
| Aussie Grill | |||||||
| Company-owned (1) | 4 | 1 | — | 5 | |||
| U.S. total | 1,166 | 2 | (1) | 1,167 | |||
| International: | |||||||
| Company-owned | |||||||
| Outback Steakhouse - Brazil (2) | 113 | 9 | — | 122 | |||
| Other (1)(3) | 33 | — | — | 33 | |||
| Franchised | |||||||
| Outback Steakhouse - South Korea (1) | 77 | 1 | — | 78 | |||
| Other (3) | 54 | 3 | (3) | 54 | |||
| International total | 277 | 13 | (3) | 287 | |||
| System-wide total | 1,443 | 15 | (4) | 1,454 | |||
| System-wide total - Company-owned | 1,155 | 11 | (1) | 1,165 | |||
| System-wide total - Franchised | 288 | 4 | (3) | 289 | |||
| __________ | |||||||
| (1) Restaurant counts as of September 26, 2021 have been adjusted to exclude off-premises only kitchens included in the table below. (2) The restaurant counts for Brazil are reported as of August 31, 2021 and November 30, 2021, respectively, to correspond with the balance sheet dates of this subsidiary. (3) International Company-owned Other and International Franchised Other included two and three Aussie Grill locations, respectively, as of December 26, 2021. | |||||||
| Number of kitchens (1): | SEPTEMBER 26, | OPENINGS | CLOSURES | DECEMBER 26, | |||
| U.S: | |||||||
| Company-owned | 3 | — | — | 3 | |||
| International: | |||||||
| Company-owned | 1 | — | — | 1 | |||
| Franchised - South Korea | 37 | 3 | — | 40 | |||
| System-wide total | 41 | 3 | — | 44 | |||
| __________ | |||||||
| (1) Excludes virtual concepts that operate out of existing restaurants and sports venue locations. | |||||||
| TABLE NINE | |||||||||||
| BLOOMIN’ BRANDS, INC. | |||||||||||
| COMPARABLE RESTAURANT SALES INFORMATION | |||||||||||
| (UNAUDITED) | |||||||||||
| THIRTEEN WEEKS ENDED | FISCAL YEAR | ||||||||||
| DECEMBER 26, | DECEMBER 27, | 2021 | 2020 | ||||||||
| COMPARABLE | COMPARABLE | COMPARABLE | COMPARABLE | COMPARABLE | COMPARABLE | ||||||
| Year over year percentage change: | |||||||||||
| Comparable restaurant sales (stores open 18 months or more): | |||||||||||
| U.S. (2) | |||||||||||
| Outback Steakhouse | 2.5 % | 20.7 % | (15.2) % | 3.2 % | 24.2 % | (16.9) % | |||||
| Carrabba’s Italian Grill | 10.3 % | 24.4 % | (11.4) % | 10.5 % | 32.2 % | (16.4) % | |||||
| Bonefish Grill | 1.3 % | 39.0 % | (27.1) % | (1.7) % | 40.6 % | (30.1) % | |||||
| Fleming’s Prime Steakhouse & Wine Bar | 20.3 % | 71.1 % | (29.7) % | 13.4 % | 60.9 % | (29.5) % | |||||
| Combined U.S. | 5.3 % | 27.9 % | (17.7) % | 4.5 % | 30.5 % | (19.9) % | |||||
| International | |||||||||||
| Outback Steakhouse - Brazil (3) | 8.5 % | 26.5 % | (14.8) % | (12.0) % | 28.7 % | (31.4) % | |||||
| Traffic: | |||||||||||
| U.S. | |||||||||||
| Outback Steakhouse | (4.5) % | 13.6 % | (16.1) % | (2.6) % | 18.1 % | (17.6) % | |||||
| Carrabba’s Italian Grill | 2.3 % | 17.9 % | (13.2) % | 6.4 % | 24.6 % | (14.6) % | |||||
| Bonefish Grill | (3.1) % | 27.2 % | (22.0) % | (2.0) % | 24.3 % | (20.0) % | |||||
| Fleming’s Prime Steakhouse & Wine Bar | 9.5 % | 51.7 % | (27.8) % | 3.8 % | 41.7 % | (26.7) % | |||||
| Combined U.S. | (2.5) % | 17.0 % | (16.6) % | (0.6) % | 20.7 % | (17.6) % | |||||
| International | |||||||||||
| Outback Steakhouse - Brazil | 9.5 % | 20.1 % | (9.0) % | (3.6) % | 23.5 % | (21.5) % | |||||
| Average check per person (4): | |||||||||||
| U.S. | |||||||||||
| Outback Steakhouse | 7.0 % | 7.1 % | 0.9 % | 5.8 % | 6.1 % | 0.7 % | |||||
| Carrabba’s Italian Grill | 8.0 % | 6.5 % | 1.8 % | 4.1 % | 7.6 % | (1.8) % | |||||
| Bonefish Grill | 4.4 % | 11.8 % | (5.1) % | 0.3 % | 16.3 % | (10.1) % | |||||
| Fleming’s Prime Steakhouse & Wine Bar | 10.8 % | 19.4 % | (1.9) % | 9.6 % | 19.2 % | (2.8) % | |||||
| Combined U.S. | 7.8 % | 10.9 % | (1.1) % | 5.1 % | 9.8 % | (2.3) % | |||||
| International | |||||||||||
| Outback Steakhouse - Brazil | (1.8) % | 6.1 % | (5.9) % | (8.2) % | 5.6 % | (9.9) % | |||||
| __________ | |||||||||||
| (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 | FISCAL YEAR | ||
| (dollars in thousands) | DECEMBER 26, 2021 | 2021 | |
| Net income attributable to common stockholders | $ 60,699 | $ 215,555 | |
| Provision for income taxes | 1,557 | 26,384 | |
| Interest expense, net | 13,751 | 57,614 | |
| Depreciation and amortization | 40,799 | 163,391 | |
| EBITDA | $ 116,806 | $ 462,944 | |
| TABLE ELEVEN | |
| BLOOMIN’ BRANDS, INC. | |
| FISCAL YEAR 2022 EBITDA OUTLOOK RECONCILIATION | |
| (UNAUDITED) | |
| FISCAL YEAR | |
| (dollars in millions) | 2022 |
| Net income attributable to common stockholders | $226M to $236M |
| Provision for income taxes | $44M to $50M |
| Interest expense, net | $51M to $52M |
| Depreciation and amortization | $174M to $177M |
| EBITDA | $495M to $515M |
