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Papa John’s Announces Third Quarter 2012 Results

For more information about the company, please visit www.papajohns.com.

 
 
Papa John's International, Inc. and Subsidiaries
Consolidated Statements of Income
           
 
Three Months Ended Nine Months Ended

September 23, 2012
 

September 25, 2011

September 23, 2012
 

September 25, 2011
(In thousands, except per share amounts) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues:
North America:
Domestic Company-owned restaurant sales $ 143,299 $ 128,787 $ 430,641 $ 395,099
Franchise royalties 18,777 17,967 58,396 55,801
Franchise and development fees 160 155 588 464
Domestic commissary sales 132,666 130,870 396,869 379,569
Other sales 12,581 12,368 36,610 38,185
International:
Royalties and franchise and development fees 4,582 4,054 13,769 11,865
Restaurant and commissary sales   13,449       11,467     38,496       30,686  
Total revenues 325,514 305,668 975,369 911,669
 
Costs and expenses:
Domestic Company-owned restaurant expenses:
Cost of sales 34,054 32,229 99,391 94,491
Salaries and benefits 39,587 35,012 118,239 107,028
Advertising and related costs 13,920 11,790 39,897 36,477
Occupancy costs 9,185 8,496 25,702 24,304
Other operating expenses   21,490       18,858     62,738       57,265  
Total domestic Company-owned restaurant expenses 118,236 106,385 345,967 319,565
 
Domestic commissary and other expenses:
Cost of sales 111,114 110,387 328,364 320,359
Salaries and benefits 9,654 8,840 27,875 26,502
Other operating expenses   14,082       13,381     41,886       40,050  
Total domestic commissary and other expenses 134,850 132,608 398,125 386,911
 
International operating expenses 11,394 9,634 32,761 26,118
General and administrative expenses 30,426 27,332 93,485 84,023
Other general expenses 1,211 4,777 8,020 7,017
Depreciation and amortization   8,192       7,974     24,223       24,711  
Total costs and expenses   304,309       288,710     902,581       848,345  
 
Operating income 21,205 16,958 72,788 63,324
Net interest expense   (148 )     (112 )   (353 )     (631 )
Income before income taxes 21,057 16,846 72,435 62,693
Income tax expense   7,112       4,906     24,479       20,151  
Net income, including noncontrolling interests 13,945 11,940 47,956 42,542
Net income attributable to noncontrolling interests   (794 )     (817 )   (3,292 )     (2,868 )
Net income, net of noncontrolling interests $ 13,151     $ 11,123   $ 44,664     $ 39,674  
 
Basic earnings per common share $ 0.57     $ 0.45   $ 1.89     $ 1.57  
Earnings per common share - assuming dilution $ 0.55     $ 0.44   $ 1.85     $ 1.55  
 
Basic weighted average shares outstanding   23,268       24,964     23,685       25,302  
Diluted weighted average shares outstanding   23,721       25,146     24,107       25,528  

 
 
Papa John's International, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
   
 
September 23, December 25,
2012 2011
(In thousands) (Unaudited) (Note)
 
Assets
Current assets:
Cash and cash equivalents $ 25,353 $ 18,942
Accounts receivable, net 33,072 28,169
Notes receivable, net 4,245 4,221
Inventories 21,419 20,091
Prepaid expenses and other current assets 13,172 15,765
Deferred income taxes   8,409   7,636
Total current assets 105,670 94,824
 
Property and equipment, net 185,596 181,910
Notes receivable, less current portion, net 12,757 11,502
Goodwill 78,971 75,085
Other assets   29,485   27,061
Total assets $ 412,479 $ 390,382
 
 
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 34,072 $ 32,966
Income and other taxes payable 10,217 3,969
Accrued expenses and other current liabilities   53,026   44,198
Total current liabilities 97,315 81,133
 
Deferred revenue 8,019 4,780
Long-term debt 50,000 51,489
Other long-term liabilities 24,611 22,014
Long-term accrued income taxes 4,220 3,597
Deferred income taxes   10,508   9,147
Total liabilities 194,673 172,160
 
Total stockholders' equity   217,806   218,222
Total liabilities and stockholders' equity $ 412,479 $ 390,382
 
Note: The balance sheet at December 25, 2011 has been derived from the audited consolidated financial statements at that date, but does not include all information and footnotes required by accounting principles generally accepted in the United States for a complete set of financial statements.

 
 
Papa John's International, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
   
Nine Months Ended
(In thousands)

September 23, 2012
 

September 25, 2011
(Unaudited) (Unaudited)
 
Operating activities
Net income, including noncontrolling interests $ 47,956 $ 42,542

Adjustments to reconcile net income to net cash provided by operating activities:
Provision for uncollectible accounts and notes receivable 1,250 882
Depreciation and amortization 24,223 24,711
Deferred income taxes 647 5,219
Stock-based compensation expense 4,932 5,266
Excess tax benefit on equity awards (1,717 ) (576 )
Other 3,789 1,272
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable (6,018 ) (3,071 )
Inventories (1,188 ) 201
Prepaid expenses and other current assets 3,138 4,102
Other assets and liabilities (1,463 ) 1,000
Accounts payable 1,106 3,896
Income and other taxes payable 6,248 3,023
Accrued expenses and other current liabilities 7,258 (228 )
Long-term accrued income taxes 623 55
Deferred revenue   3,989     (1,078 )
Net cash provided by operating activities 94,773 87,216
 
Investing activities
Purchase of property and equipment (26,425 ) (20,647 )
Loans issued (3,951 ) (2,598 )
Repayments of loans issued 2,620 4,542
Acquisitions, net of cash acquired (6,175 ) -
Proceeds from divestitures of restaurants 1,068 -
Other   4     62  
Net cash used in investing activities (32,859 ) (18,641 )
 
Financing activities
Net repayments on line of credit facility (1,489 ) (49,000 )
Excess tax benefit on equity awards 1,717 576
Tax payments for restricted stock (846 ) (1,041 )
Proceeds from exercise of stock options 11,399 10,981
Acquisition of Company common stock (64,146 ) (49,579 )
Distributions to noncontrolling interests (2,431 ) (3,129 )
Other   174     97  
Net cash used in financing activities (55,622 ) (91,095 )
 
Effect of exchange rate changes on cash and cash equivalents   119     67  
Change in cash and cash equivalents 6,411 (22,453 )
Cash and cash equivalents at beginning of period   18,942     47,829  
 
Cash and cash equivalents at end of period $ 25,353   $ 25,376  

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