Delaware | 001-35625 | 20-8023465 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit Number | Description | ||
99.1 | Press Release of Bloomin’ Brands, Inc. dated September 4, 2012 |
BLOOMIN’ BRANDS, INC. | |||
(Registrant) | |||
Date: | September 4, 2012 | By: | /s/ David J. Deno |
David J. Deno | |||
Executive Vice President and Chief Financial Officer |
NEWS | Exhibit 99.1 | |||
Mark W. Seymour, Jr. | ||||
Vice President, Investor Relations | ||||
(813) 282-1225 |
• | Bloomin’ Brands, Inc. Announces Second Quarter EPS of $0.16 or 23% Above a Year Ago; |
• | Reports Ninth Consecutive Quarter of Positive Comparable Restaurant Sales Growth for all Core Domestic Concepts; and |
• | Provides Full-year Guidance for 2012. |
• | Second quarter Adjusted diluted earnings per share increased 20.0% to $0.18. Diluted earnings per share increased 23.1% to $0.16. |
THREE MONTHS ENDED JUNE 30, | |||||||||||
2012 | 2011 | % change | |||||||||
Diluted earnings per share | $ | 0.16 | $ | 0.13 | 23.1 | % | |||||
Adjustments (1) | 0.02 | 0.02 | — | ||||||||
Adjusted diluted earnings per share | $ | 0.18 | $ | 0.15 | 20.0 | % |
(1) | See Reconciliations of Non-GAAP Measurements to U.S. GAAP Results included later in this release. |
• | Total revenues increased by 2.7% to $980.9 million. |
• | Blended domestic comparable restaurant sales for Company-owned restaurants grew by 2.4% for the Company’s four core concepts. |
• | Restaurant operating margins (calculated as restaurant sales less cost of sales, labor and other related costs and other restaurant operating expenses) were 15.7%, an increase of 0.8% over the second quarter of 2011. |
• | Adjusted income from operations increased 17.0% to $51.0 million as compared to $43.6 million in the second quarter of 2011. Income from operations increased 19.5% to $48.7 million as compared to $40.8 million in the same quarter in the prior year. |
• | Adjusted net income attributable to Bloomin’ Brands, Inc. increased 18.0% to $19.3 million as compared to $16.4 million in the same period in 2011. Net income attributable to Bloomin’ Brands, Inc. increased 24.5% to $17.4 million as compared to $14.0 million in the same period in 2011. |
• | The Company continued to focus on brand investments, completing 48 renovations at its Outback Steakhouse concept and opening four new Bonefish Grill restaurants. In addition, the Company opened two Company-owned Outback Steakhouse restaurants in South Korea and two Outback Steakhouse restaurants in Brazil with its joint venture partner. |
• | Total revenues increased by 2.7% to $980.9 million. This increase was primarily due to increases in customer traffic and modest price increases. Traffic increases were driven by menu innovations and promotions throughout the Company’s concepts, innovations and improvements in customer service, weekend lunch expansions at Outback Steakhouse and Carrabba’s Italian Grill and additional renovations at Outback Steakhouse. Sales also increased due to the addition of 15 new locations that were not included in the comparable restaurant sales base. This was partially offset by the sale (and franchise conversion) of nine Company-owned Outback Steakhouse restaurants in Japan in October 2011 and from the closing of four restaurants since June 30, 2011. |
• | Blended domestic comparable restaurant sales for Company-owned restaurants grew by 2.4% for the Company’s four core concepts. Results for Company-owned restaurants, by concept, were as follows: |
THREE MONTHS ENDED JUNE 30, 2012 | COMPANY- OWNED | |
Domestic comparable restaurant sales (stores open 18 months or more) | ||
Outback Steakhouse | 2.3% | |
Carrabba’s Italian Grill | 1.5% | |
Bonefish Grill | 2.1% | |
Fleming’s Prime Steakhouse and Wine Bar | 6.8% |
• | The number of weekdays and weekend days, as well as the timing of holidays, can impact the Company's reported comparable restaurant sales. The trading day impact on blended domestic comparable restaurant sales for Company-owned restaurants for the second quarter of 2012 was approximately (0.6)%. Without the trading day impact, blended domestic comparable restaurant sales for Company-owned restaurants grew by 3.0% for the second quarter of 2012. |
• | Adjusted net income attributable to Bloomin’ Brands, Inc. increased 18.0% to $19.3 million. Net income attributable to Bloomin’ Brands, Inc. increased 24.5% in the quarter to $17.4 million. This was primarily due to increased sales and improved management of labor costs as a result of productivity initiatives instituted during the quarter. |
• | Comparable restaurant sales growth of at least 3%. |
• | Total revenues of approximately $4 billion representing a nearly 4% increase. The Company's longer-term goal is at least 7% annual growth as development pace increases. |
• | Adjusted income from operations of at least $229 million, and Income from operations of at least $175 million. This includes significant expenses resulting from the Company's IPO and retirement of the Notes. |
• | Adjusted net income attributable to Bloomin’ Brands, Inc. of at least $105 million. This assumes a full year effective tax rate of between 18% and 20%. Net income attributable to Bloomin’ Brands, Inc. of approximately $50 million, including expenses described above. |
• | Based on the Adjusted net income attributable to Bloomin’ Brands, Inc. expectation above, Adjusted diluted earnings per share of at least $0.91. This assumes the underwriters for the Company’s IPO do not exercise their option to purchase additional shares, which expires on September 6, 2012. The Company estimates that, if the option is exercised in full, the impact could be a $0.01 reduction in Diluted earnings per share for the year. |
• | Capital expenditures of approximately $200 million to $220 million. New restaurant development expectations include approximately 35 new restaurants: 23 new Company-owned domestic locations, five new Company-owned international locations, and seven new franchised or development joint venture locations. |
THREE MONTHS ENDED | SIX MONTHS ENDED | ||||||||||||||
JUNE 30, | JUNE 30, | ||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Revenues | |||||||||||||||
Restaurant sales | $ | 970,021 | $ | 946,033 | $ | 2,015,487 | $ | 1,939,142 | |||||||
Other revenues | 10,845 | 9,469 | 21,005 | 18,209 | |||||||||||
Total revenues | 980,866 | 955,502 | 2,036,492 | 1,957,351 | |||||||||||
Costs and expenses | |||||||||||||||
Cost of sales | 315,472 | 305,003 | 651,331 | 622,767 | |||||||||||
Labor and other related | 271,400 | 275,314 | 564,901 | 558,121 | |||||||||||
Other restaurant operating | 230,877 | 224,692 | 449,842 | 438,849 | |||||||||||
Depreciation and amortization | 39,247 | 38,463 | 78,107 | 76,751 | |||||||||||
General and administrative | 72,216 | 69,548 | 148,218 | 131,126 | |||||||||||
Provision for impaired assets and restaurant closings | 4,654 | 3,723 | 9,089 | 3,931 | |||||||||||
Income from operations of unconsolidated affiliates | (1,720 | ) | (1,995 | ) | (4,124 | ) | (5,641 | ) | |||||||
Total costs and expenses | 932,146 | 914,748 | 1,897,364 | 1,825,904 | |||||||||||
Income from operations | 48,720 | 40,754 | 139,128 | 131,447 | |||||||||||
Loss on extinguishment of debt | — | — | (2,851 | ) | — | ||||||||||
Other (expense) income, net | (183 | ) | 559 | (129 | ) | 256 | |||||||||
Interest expense, net | (24,037 | ) | (20,692 | ) | (45,011 | ) | (41,885 | ) | |||||||
Income before provision for income taxes | 24,500 | 20,621 | 91,137 | 89,818 | |||||||||||
Provision for income taxes | 3,936 | 4,178 | 16,741 | 15,260 | |||||||||||
Net income | 20,564 | 16,443 | 74,396 | 74,558 | |||||||||||
Less: net income attributable to noncontrolling interests | 3,124 | 2,440 | 6,957 | 5,663 | |||||||||||
Net income attributable to Bloomin’ Brands, Inc. | $ | 17,440 | $ | 14,003 | $ | 67,439 | $ | 68,895 | |||||||
Net income | $ | 20,564 | $ | 16,443 | $ | 74,396 | $ | 74,558 | |||||||
Other comprehensive income: | |||||||||||||||
Foreign currency translation adjustment | (6,662 | ) | 4,124 | (3,513 | ) | 7,144 | |||||||||
Comprehensive income | 13,902 | 20,567 | 70,883 | 81,702 | |||||||||||
Less: comprehensive income attributable to noncontrolling interests | 3,124 | 2,440 | 6,957 | 5,663 | |||||||||||
Comprehensive income attributable to Bloomin’ Brands, Inc. | $ | 10,778 | $ | 18,127 | $ | 63,926 | $ | 76,039 | |||||||
Net income attributable to Bloomin’ Brands, Inc. per common share: | |||||||||||||||
Basic | $ | 0.16 | $ | 0.13 | $ | 0.63 | $ | 0.65 | |||||||
Diluted | $ | 0.16 | $ | 0.13 | $ | 0.63 | $ | 0.65 | |||||||
Weighted average common shares outstanding: | |||||||||||||||
Basic | 106,361 | 106,135 | 106,361 | 106,135 | |||||||||||
Diluted | 107,380 | 106,214 | 107,255 | 106,362 |
JUNE 30, | DECEMBER 31, | ||||||
2012 | 2011 | ||||||
(unaudited) | |||||||
Cash and cash equivalents (1) | $ | 279,954 | $ | 482,084 | |||
Net working capital (deficit) (2) (3) | (47,184 | ) | (248,145 | ) | |||
Total assets | 3,000,822 | 3,353,936 | |||||
Total debt, net (3) | 1,788,290 | 2,109,290 | |||||
Total stockholders’ equity | 105,441 | 40,297 |
(1) | Excludes restricted cash. |
(2) | The Company has, and in the future may continue to have, negative working capital balances (as is common for many restaurant companies). The Company operates successfully with negative working capital because cash collected on restaurant sales is typically received before payment is due on its current liabilities and its inventory turnover rates require relatively low investment in inventories. Additionally, ongoing cash flows from restaurant operations and gift card sales are used to service debt obligations and for capital expenditures. |
(3) | On June 14, 2007, Private Restaurant Properties, LLC, an indirect wholly-owned subsidiary, entered into a commercial mortgage-backed securities loan (the “CMBS Loan”) totaling $790.0 million, which had a maturity date of June 9, 2012. Effective March 27, 2012, New Private Restaurant Properties, LLC and two of the Company’s other indirect wholly-owned subsidiaries entered into a new commercial mortgage-backed securities loan (the “2012 CMBS Loan”) totaling $500.0 million and used the proceeds, together with the proceeds from a sale-leaseback transaction and existing cash, to repay the CMBS Loan. The 2012 CMBS Loan and the repayment of the CMBS Loan are collectively referred to as the “CMBS Refinancing.” The 2012 CMBS Loan is a five-year loan maturing on April 10, 2017. As a result of the CMBS Refinancing, the net amount repaid along with scheduled maturities within one year, $281.3 million, was classified as current at December 31, 2011. |
THREE MONTHS ENDED | SIX MONTHS ENDED | |||||||||||||||
JUNE 30, | JUNE 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Transaction-related expenses (1) | $ | — | $ | 556 | $ | 6,761 | $ | 569 | ||||||||
Management fees and expenses (2) | 2,291 | 2,275 | 4,617 | 4,526 | ||||||||||||
Loss on extinguishment of debt (3) | — | — | 2,851 | — | ||||||||||||
Tax effect of the above (4) | (426 | ) | (470 | ) | (2,647 | ) | (846 | ) | ||||||||
Total adjustments, net of tax | $ | 1,865 | $ | 2,361 | $ | 11,582 | $ | 4,249 | ||||||||
Diluted shares outstanding | 107,380 | 106,214 | 107,255 | 106,362 | ||||||||||||
Adjustment to diluted earnings per share | $ | 0.02 | $ | 0.02 | $ | 0.11 | $ | 0.04 |
THREE MONTHS ENDED | SIX MONTHS ENDED | |||||||||||||||
JUNE 30, | JUNE 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Diluted earnings per share | $ | 0.16 | $ | 0.13 | $ | 0.63 | $ | 0.65 | ||||||||
Adjustment to diluted earnings per share | 0.02 | 0.02 | 0.11 | 0.04 | ||||||||||||
Adjusted diluted earnings per share | $ | 0.18 | $ | 0.15 | $ | 0.74 | $ | 0.69 |
THREE MONTHS ENDED | SIX MONTHS ENDED | |||||||||||||||
JUNE 30, | JUNE 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Income from operations | $ | 48,720 | $ | 40,754 | $ | 139,128 | $ | 131,447 | ||||||||
Transaction-related expenses (1) | — | 556 | 6,761 | 569 | ||||||||||||
Management fees and expenses (2) | 2,291 | 2,275 | 4,617 | 4,526 | ||||||||||||
Adjusted income from operations | $ | 51,011 | $ | 43,585 | $ | 150,506 | $ | 136,542 |
THREE MONTHS ENDED | SIX MONTHS ENDED | |||||||||||||||
JUNE 30, | JUNE 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net income attributable to Bloomin’ Brands, Inc. | $ | 17,440 | $ | 14,003 | $ | 67,439 | $ | 68,895 | ||||||||
Transaction-related expenses (1) | — | 556 | 6,761 | 569 | ||||||||||||
Management fees and expenses (2) | 2,291 | 2,275 | 4,617 | 4,526 | ||||||||||||
Loss on extinguishment of debt (3) | — | — | 2,851 | — | ||||||||||||
Tax effect of the above (4) | (426 | ) | (470 | ) | (2,647 | ) | (846 | ) | ||||||||
Adjusted net income attributable to Bloomin’ Brands, Inc. | $ | 19,305 | $ | 16,364 | $ | 79,021 | $ | 73,144 |
(1) | Transaction-related expenses primarily relate to those costs incurred in association with the refinancing of debt and other deal costs. |
(2) | Represents management fees and out-of-pocket and other reimbursable expenses paid to a management company owned by the Company’s investor group comprised of funds advised by Bain Capital Partners, LLC and Catterton Management Company, LLC and Chris T. Sullivan, Robert D. Basham and J. Timothy Gannon under a management agreement that terminated upon the completion of the IPO. |
(3) | Loss on extinguishment of debt is related to the refinancing of the CMBS Loan. |
(4) | Tax adjustments for the three and six months ended June 30, 2012 are calculated using the Company's expected full-year effective tax rate of 18.6%. Tax adjustments for the three and six months ended June 30, 2011 are calculated using the Company's full-year 2011 effective tax rate of 16.6%. |
JUNE 30, | |||||
2012 | 2011 | ||||
Number of restaurants (at end of the period): | |||||
Outback Steakhouse | |||||
Company-owned - domestic | 669 | 670 | |||
Company-owned - international | 113 | 120 | |||
Franchised - domestic | 106 | 107 | |||
Franchised and development joint venture - international | 83 | 68 | |||
Total | 971 | 965 | |||
Carrabba’s Italian Grill | |||||
Company-owned | 230 | 231 | |||
Franchised | 1 | 1 | |||
Total | 231 | 232 | |||
Bonefish Grill | |||||
Company-owned | 155 | 145 | |||
Franchised | 7 | 7 | |||
Total | 162 | 152 | |||
Fleming’s Prime Steakhouse and Wine Bar | |||||
Company-owned | 64 | 64 | |||
Roy’s | |||||
Company-owned | 22 | 22 | |||
System-wide total | 1,450 | 1,435 |