'As we continue to navigate through the challenges currently facing our industry, we have remained resolute in our focus to return to growth. Throughout the second quarter, weekly comparable sales and traffic at both Applebee's and IHOP improved as state and local governments began to ease restrictions on dining room operations. This, coupled with the significant growth of our brands' off-premise business, contributed to the progress made during the quarter,' said
Domestic System-Wide Comparable Same-Restaurant Sales Performance
Domestic Same-Restaurant Sales: See results at:
http://investors.dineequity.com/index.php/news-releases/news-release-details/dine-brands-global-inc-reports-second-quarter-2020-results
Second Quarter of 2020
Applebee's comparable same-restaurant sales improved 11 out of 13 weeks through the week ended
IHOP's comparable same-restaurant sales improved sequentially for 12 consecutive weeks out of 13 through the week ended
Comparable same-restaurant sales for the second quarter of 2020 declined at both Applebee's and IHOP primarily due to the impact of COVID-19 and related governmental restrictions on restaurant operations at the federal, state and local levels, which resulted in a meaningful decline in traffic for the second quarter of 2020.
As of
Off-Premise Sales Growth Comparison
Off-premise sales at both Applebee's and IHOP increased significantly primarily as a result of governmental mandates, which placed restrictions on dine-in service as well as the favorable impact of the Company's digital initiatives.
Applebee's off-premise sales accounted for 60.5% of sales mix for the second quarter of 2020, as compared to 16.3% of sales mix for the first quarter of 2020 and 13.0% of sales mix for the fourth quarter of 2019.
Applebee's delivery sales accounted for 16.8% of sales mix and take-out sales accounted for 43.8% of sales mix for the second quarter of 2020.
Applebee's online sales as a percentage of total sales increased by 17.8 percentage points in the second quarter of 2020 to 22.9%. This compares to 5.1% of total sales for the first quarter of 2020.
IHOP's off-premise sales accounted for 53.6% of sales mix for the second quarter of 2020, as compared to 12.8% of sales mix for the first quarter of 2020 and 10.1% of sales mix for the fourth quarter of 2019.
IHOP's delivery sales accounted for 23.4% of sales mix and take-out sales accounted for 33.5% of sales mix for the second quarter of 2020.
IHOP's online sales as a percentage of total sales increased by 27.8 percentage points in the second quarter of 2020 to 34.7%. This compares to 6.9% of total sales for the first quarter of 2020.
Second Quarter of 2020 Summary
GAAP net loss per diluted share of
This variance was primarily due to non-cash impairment charges totaling
Additionally, gross profit decreased primarily due to a significant decline in customer traffic as a result of governmental measures to stem the spread of the coronavirus and related changes in consumer behavior.
Adjusted net loss per diluted share of
General and administrative expenses for the second quarter of 2020 declined 21.6% year-over-year to
Net loss of
Consolidated adjusted EBITDA for the second quarter of 2020 was
Cash used in operating activities for the first six months of 2020 was
The Company had negative adjusted free cash flow of
GAAP net loss available to common stockholders was
Adjusted net loss available to common stockholders was
Cash Position
Dine Brands has taken precautionary measures to increase the Company's financial flexibility due to the conditions caused by COVID-19. As previously disclosed on
As of
The Company makes
The Company voluntarily doubled its interest reserve on its Class A-2 Notes during the second quarter of 2020 to
GAAP Effective Tax Rate
Our effective tax rate for the second quarter of 2020 was an 8.2% tax benefit compared to a 26.4% expense for the second quarter of 2019. The variance is primarily due to the non-deductibility of the Applebee's goodwill impairment discussed earlier.
Financial Performance Guidance for 2020 Withdrawn
The Company disclosed on
Applebee's Reopening Update
Applebee's restaurants began reopening their dining rooms on
IHOP Reopening Update
IHOP restaurants began reopening their dining rooms on
Second Quarter of 2020 Earnings Conference Call Details
Dine Brands will host a conference call to discuss its results on
A live webcast of the call will be available on www.dinebrands.com and may be accessed by visiting Events and Presentations under the site's Investors section. Participants should allow approximately ten minutes prior to the call's start time to visit the site and download any streaming media software needed to listen to the webcast. A telephonic replay of the call may be accessed from
About
Based in
Forward-Looking Statements
Statements contained in this press release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can identify these forward-looking statements by words such as 'may,' 'will,' 'would,' 'should,' 'could,' 'expect,' 'anticipate,' 'believe,' 'estimate,' 'intend,' 'plan,' 'goal' and other similar expressions. These statements involve known and unknown risks, uncertainties and other factors, which may cause actual results to be materially different from those expressed or implied in such statements. These factors include, but are not limited to: uncertainty regarding the duration and severity of the ongoing COVID-19 pandemic and its ultimate impact on the Company; the effectiveness of related containment measures; general economic conditions; our level of indebtedness; compliance with the terms of our securitized debt; our ability to refinance our current indebtedness or obtain additional financing; our dependence on information technology; potential cyber incidents; the implementation of restaurant development plans; our dependence on our franchisees; the concentration of our Applebee's franchised restaurants in a limited number of franchisees; the financial health of our franchisees; our franchisees' and other licensees' compliance with our quality standards and trademark usage; general risks associated with the restaurant industry; potential harm to our brands' reputation; possible future impairment charges; the effects of tax reform; trading volatility and fluctuations in the price of our stock; our ability to achieve the financial guidance we provide to investors; successful implementation of our business strategy; the availability of suitable locations for new restaurants; shortages or interruptions in the supply or delivery of products from third parties or availability of utilities; the management and forecasting of appropriate inventory levels; development and implementation of innovative marketing and use of social media; changing health or dietary preference of consumers; risks associated with doing
business in international markets; the results of litigation and other legal proceedings; third-party claims with respect to intellectual property assets; our ability to attract and retain management and other key employees; compliance with federal, state and local governmental regulations; risks associated with our self-insurance; natural disasters, pandemics, epidemics, or other serious incidents; our success with development initiatives outside of our core business; the adequacy of our internal controls over financial reporting and future changes in accounting standards; and other factors discussed from time to time in the Corporation's Annual and Quarterly Reports on Forms 10-K and 10-Q and in the Corporation's other filings with the
Non-GAAP Financial Measures
This press release includes references to the Company's non-GAAP financial measure 'adjusted net income available to common stockholders', 'adjusted earnings per diluted share (Adjusted EPS)', 'Adjusted EBITDA' and 'Adjusted free cash flow.' Adjusted EPS is computed for a given period by deducting from net income or loss available to common stockholders for such period the effect of any closure and impairment charges, any gain or loss related to debt extinguishment, any intangible asset amortization, any non-cash interest expense, any gain or loss related to the disposition of assets, and other items deemed not reflective of current operations. This is presented on an aggregate basis and a per share (diluted) basis. Adjusted EBITDA is computed for a given period by deducting from net income or loss for such period the effect of any closure and impairment charges, any interest charges, any income tax provision or benefit, any non-cash stock-based compensation, any depreciation and amortization, any gain or loss related to the disposition of assets and other items deemed not reflective of current operations. 'Adjusted free cash flow' for a given period is defined as cash provided by operating activities, plus receipts from notes and equipment contracts receivable, less capital expenditures. Management may use certain of these non-GAAP financial measures along with the corresponding
Consolidated Statements of Comprehensive (Loss) Income: See detailed results at:
http://investors.dineequity.com/index.php/news-releases/news-release-details/dine-brands-global-inc-reports-second-quarter-2020-results
Investor Contact
Executive Director, Investor Relations
818-637-3632
Media Contact
Vice President,
and Public Affairs
818-637-4726
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