Brinker International, Inc. Files 10-Q for Period Ending December 27, 2023

Ticker: EAT · Form: 10-Q · Filed: 2024-01-31T00:00:00.000Z

Sentiment: neutral

Topics: Brinker International, 10-Q, Quarterly Report, Restaurant Industry, Financials

TL;DR

<b>Brinker International reports $1.13 billion in revenue for Q2 2024, with company sales at $949.7 million and franchise revenues at $180.3 million.</b>

AI Summary

BRINKER INTERNATIONAL, INC (EAT) filed a Quarterly Report (10-Q) with the SEC on January 31, 2024. Total revenue for the quarter ended December 27, 2023, was $1.13 billion. Company sales for the quarter ended December 27, 2023, amounted to $949.7 million. Franchise revenues for the quarter ended December 27, 2023, were $180.3 million. Total revenue for the six months ended December 27, 2023, was $2.23 billion. Company sales for the six months ended December 27, 2023, were $1.88 billion.

Why It Matters

For investors and stakeholders tracking BRINKER INTERNATIONAL, INC, this filing contains several important signals. The filing provides a detailed financial snapshot of Brinker International's performance in the second quarter of fiscal year 2024. Investors can analyze revenue streams from both company-owned restaurants and franchise operations to assess overall business health.

Risk Assessment

Risk Level: low — BRINKER INTERNATIONAL, INC shows low risk based on this filing. The filing is a standard quarterly report (10-Q) and does not contain significant new risks or material adverse events.

Analyst Insight

Monitor future filings for trends in company sales versus franchise revenues and compare performance against industry benchmarks.

Revenue Breakdown

SegmentRevenueGrowth
Company Sales949.7
Franchise Revenues180.3
Company Sales1.88
Franchise Revenues

Key Numbers

Key Players & Entities

Forward-Looking Statements

FAQ

When did BRINKER INTERNATIONAL, INC file this 10-Q?

BRINKER INTERNATIONAL, INC filed this Quarterly Report (10-Q) with the SEC on January 31, 2024.

What is a 10-Q filing?

A 10-Q is a quarterly financial report with unaudited financials, management discussion, and interim business updates. This particular 10-Q was filed by BRINKER INTERNATIONAL, INC (EAT).

Where can I read the original 10-Q filing from BRINKER INTERNATIONAL, INC?

You can access the original filing directly on the SEC's EDGAR system. The filing is publicly available and includes all exhibits and attachments submitted by BRINKER INTERNATIONAL, INC.

What are the key takeaways from BRINKER INTERNATIONAL, INC's 10-Q?

BRINKER INTERNATIONAL, INC filed this 10-Q on January 31, 2024. Key takeaways: Total revenue for the quarter ended December 27, 2023, was $1.13 billion.. Company sales for the quarter ended December 27, 2023, amounted to $949.7 million.. Franchise revenues for the quarter ended December 27, 2023, were $180.3 million..

Is BRINKER INTERNATIONAL, INC a risky investment based on this filing?

Based on this 10-Q, BRINKER INTERNATIONAL, INC presents a relatively low-risk profile. The filing is a standard quarterly report (10-Q) and does not contain significant new risks or material adverse events.

What should investors do after reading BRINKER INTERNATIONAL, INC's 10-Q?

Monitor future filings for trends in company sales versus franchise revenues and compare performance against industry benchmarks. The overall sentiment from this filing is neutral.

Key Dates

Filing Stats: 4,765 words · 19 min read · ~16 pages · Grade level 7.4 · Accepted 2024-01-31 16:42:54

Key Financial Figures

Filing Documents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 3

Financial Statements

Item 1. Financial Statements 3 Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - Thirteen and Twenty-Six Week Periods Ended December 27, 2023 and December 28, 2022 3 Consolidated Balance Sheets - December 27, 2023 (Unaudited) and June 28, 2023 4 Consolidated Statements of Cash Flows (Unaudited) - Twenty-Six Week Periods Ended December 27, 2023 and December 28, 2022 5 Consolidated Statements of Shareholders' Deficit (Unaudited) - Twenty-Six Week Periods Ended December 27, 2023 and December 28, 2022 6

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 7

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 18

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 32

Controls and Procedures

Item 4. Controls and Procedures 33

OTHER INFORMATION

PART II. OTHER INFORMATION 34

Legal Proceedings

Item 1. Legal Proceedings 34

Risk Factors

Item 1A. Risk Factors 34

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 34

Other Information

Item 5. Other Information 34

Exhibits

Item 6. Exhibits 35

SIGNATURES

SIGNATURES 35 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS BRINKER INTERNATIONAL, INC. Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (In millions, except per share amounts) Thirteen Week Periods Ended Twenty-Six Week Periods Ended December 27, 2023 December 28, 2022 December 27, 2023 December 28, 2022 Revenues Company sales $ 1,063.7 $ 1,009.4 $ 2,065.7 $ 1,955.5 Franchise revenues 10.4 9.6 20.9 19.0 Total revenues 1,074.1 1,019.0 2,086.6 1,974.5 Operating costs and expenses Food and beverage costs 273.1 289.4 531.9 578.9 Restaurant labor 356.1 334.6 704.2 665.2 Restaurant expenses 294.7 268.4 585.5 537.2 Depreciation and amortization 41.3 41.8 83.2 83.7 General and administrative 43.2 35.6 85.6 75.1 Other (gains) and charges 3.3 8.5 9.6 13.5 Total operating costs and expenses 1,011.7 978.3 2,000.0 1,953.6 Operating income 62.4 40.7 86.6 20.9 Interest expenses 16.7 13.9 33.7 26.2 Other income, net ( 0.1 ) ( 0.3 ) ( 0.1 ) ( 0.7 ) Income (loss) before income taxes 45.8 27.1 53.0 ( 4.6 ) Provision (benefit) for income taxes 3.7 ( 0.8 ) 3.7 ( 2.3 ) Net income (loss) $ 42.1 $ 27.9 $ 49.3 $ ( 2.3 ) Basic net income (loss) per share $ 0.95 $ 0.63 $ 1.11 $ ( 0.05 ) Diluted net income (loss) per share $ 0.94 $ 0.62 $ 1.09 $ ( 0.05 ) Basic weighted average shares outstanding 44.2 44.0 44.4 44.0 Diluted weighted average shares outstanding 44.9 44.8 45.1 44.0 Other comprehensive income (loss) Foreign currency translation adjustment $ 0.2 $ 0.1 $ 0.0 $ ( 0.9 ) Comprehensive income (loss) $ 42.3 $ 28.0 $ 49.3 $ ( 3.2 ) See accompanying Notes to Consolidated Financial Statements (Unaudited) 3 Table of Contents BRINKER INTERNATIONAL, INC. Consolidated Balance Sheets (In millions, except per share amounts) Unaudited December 27, 2023 June 28, 2023 ASSETS Current assets Cash and cash equivalents $ 22.7 $ 15.1 Accounts receivable, net 79.4 60.9 Inventories 34.3 34.5 Restaurant supplies 55.1 55.6 Prepaid expenses 19.7 17.2 Income taxes r

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) Footnote Index Note # Description Page Note 1 Basis of Presentation 8 Note 2 Revenue Recognition 8 Note 3 Fair Value Measurements 9 Note 4 Accrued Liabilities 10 Note 5 Leases 11 Note 6 Debt 11 Note 7 Contingencies 12 Note 8 Income Taxes 13 Note 9 Shareholders' Deficit 13 Note 10 Net Income Per Share 14 Note 11 Other Gains and Charges 14 Note 12 Segment Information 15 7 Table of Contents Footnote Index 1. BASIS OF PRESENTATION References to "Brinker," the "Company," "we," "us," and "our" in this Form 10-Q refer to Brinker International, Inc. and its subsidiaries and any predecessor companies of Brinker International, Inc. Our Consolidated Financial Statements (Unaudited) as of December 27, 2023 and June 28, 2023, and for the thirteen and twenty-six week periods ended December 27, 2023 and December 28, 2022, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). The Company is principally engaged in the ownership, operation, development and franchising of the Chili's Grill & Bar ("Chili's") and Maggiano's Little Italy ("Maggiano's") restaurant brands. As of December 27, 2023, we owned, operated or franchised 1,658 restaurants, consisting of 1,184 Company-owned restaurants and 474 franchised restaurants, located in the United States, 29 other countries and two United States territories. Use of Estimates The preparation of the Consolidated Financial Statements (Unaudited) is in conformity with generally accepted accounting principles in the United States ("GAAP") and requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements (Unaudited), and the reported amounts of revenues and costs and expenses in the reporting periods. Actual results could differ

Legal Proceedings

Legal Proceedings Evaluating contingencies related to litigation is a process involving judgment on the potential outcome of future events, and the ultimate resolution of litigated claims may differ from our current analysis. Accordingly, we review the adequacy of accruals and disclosures pertaining to litigated matters each quarter in consultation with legal counsel and we assess the probability and range of possible losses associated with contingencies for potential accrual in the Consolidated Financial Statements. We are engaged in various legal proceedings and have certain unresolved claims pending. Liabilities have been established based on our best estimates of our potential liability in certain of these matters. Based upon consultation with legal counsel, management is of the opinion that there are no matters pending or threatened which are expected to have a material adverse effect, individually or in the aggregate, on the consolidated financial condition or results of operations. 8. INCOME TAXES Twenty-Six Week Periods Ended December 27, 2023 December 28, 2022 Effective income tax rate 7.0 % 50.0 % The federal statutory tax rate was 21.0 % for the twenty-six week periods ended December 27, 2023 and December 28, 2022. The change in the effective income tax rate in the twenty-six week period ended December 27, 2023 to the twenty-six week period ended December 28, 2022 is primarily due to a less favorable impact from the FICA tip tax credit against higher Income before income taxes. 9. SHAREHOLDERS' DEFICIT Retirement of Common Stock During the first quarter of fiscal 2023, the Board of Directors approved the retirement of 10.0 million shares of Treasury stock for a weighted average price per share of $ 30.71 . As of December 27, 2023, 16.1 million shares remain in treasury. Share Repurchases Our Boar

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