Item 7.01 Regulation FD.
As disclosed in Note 2 to the Company's Form 10-Q filed onApril 30, 2021 for period endedMarch 31, 2021 , certain prior year amounts in the statement of operations and accompanying segment results have been reclassified in order to be comparable with the current year classifications. These consist of the reclassification of advertising fund contributions from Franchise and property revenues to Advertising revenues and advertising fund expenses from Selling, general and administrative expenses to Advertising expenses, with General and administrative expenses now presented separately. Depreciation and amortization expenses related to the advertising funds have also been reclassified from Franchise and property expenses to Advertising expenses. These reclassifications did not arise as a result of any changes to accounting policies and relate entirely to presentation with no effect on previously reported net income. The following information reflects these reclassifications in the results of operations for each quarter of 2020 and for the full year 2020. Results of Operations for each quarter of 2020 and full year 2020 Tabular amounts in millions ofU.S. dollars unless noted otherwise. Segment income may not calculate exactly due to rounding. Consolidated Three months ended Year ended Mar. 31 June 30 Sep. 30 Dec. 31 Dec. 31 Revenues: Sales$ 503 $ 406 $ 541 $ 563 $ 2,013 Franchise and property revenues 525 450 577 569 2,121 Advertising revenues 197 192 219 226 834 Total revenues 1,225 1,048 1,337 1,358 4,968 Operating costs and expenses: Cost of sales 399 339 418 454 1,610 Franchise and property expenses 123 132 125 135 515 Advertising expenses 226 203 209 232 870 General and administrative expenses 102 94 96 115 407 (Income) loss from equity method investments 2 16 18 3 39 Other operating expenses (income), net (16) 21 54 46 105 Total operating costs and expenses 836 805 920 985 3,546 Income from operations 389 243 417 373 1,422 Interest expense, net 119 128 129 132 508 Loss on early extinguishment of debt - - - 98 98 Income before income taxes 270 115 288 143 816 Income tax expense 46 (49) 65 4 66 Net income$ 224 $ 164 $ 223 $ 139 $ 750
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TH Segment Three months ended Year ended Mar. 31 June 30 Sep. 30 Dec. 31 Dec. 31 Revenues: Sales$ 465 $ 374 $ 506 $ 531 $ 1,876 Franchise and property revenues 188 154 205 198 745 Advertising revenues 46 39 51 53 189 Total revenues 699 567 762 782 2,810 Cost of sales 366 307 388 423 1,484 Franchise and property expenses 81 81 80 86 328 Advertising expenses 65 43 46 50 204 Segment G&A 25 20 20 28 93 Segment depreciation and amortization (a) 26 28 28 31 113 Segment income (b) 189 147 258 229 823 (a)Segment depreciation and amortization consists of depreciation and amortization included in cost of sales, franchise and property expenses and advertising expenses. (b)TH segment income includes$2 million ,$2 million ,$2 million and$3 million of cash distributions received from equity method investments for the three months endedMarch 31 ,June 30 ,September 30 andDecember 31, 2020 , respectively, and$9 million for the full year 2020. BK Segment Three months ended Year ended Mar. 31 June 30 Sep. 30 Dec. 31 Dec. 31 Revenues: Sales$ 17 $ 15 $ 17 $ 15 $ 64 Franchise and property revenues 273 233 305 302 1,113 Advertising revenues 98 99 111 117 425 Total revenues 388 347 433 434 1,602 Cost of sales 17 16 16 16 65 Franchise and property expenses 39 48 42 47 176 Advertising expenses 108 105 105 124 442 Segment G&A 37 30 37 42 146 Segment depreciation and amortization (a) 12 12 13 12 49 Segment income 200 160 245 218 823 PLK Segment Three months ended Year ended Mar. 31 June 30 Sep. 30 Dec. 31 Dec. 31 Revenues: Sales$ 21 $ 17 $ 18 $ 17 $ 73 Franchise and property revenues 64 63 67 69 263 Advertising revenues 53 54 57 56 220 Total revenues 138 134 142 142 556 Cost of sales 16 16 14 15 61 Franchise and property expenses 3 3 3 2 11 Advertising expenses 53 55 58 58 224 Segment G&A 13 10 12 14 49 Segment depreciation and amortization (a) 2 2 2 2 8 Segment income 55 51 58 54 218
-------------------------------------------------------------------------------- General and Administrative Expenses Our general and administrative expenses consisted of the following: Three months ended Year ended Mar. 31 June 30 Sep. 30 Dec. 31 Dec. 31 Segment G&A: TH$ 25 $ 20 $ 20 $ 28 $ 93 BK 37 30 37 42 146 PLK 13 10 12 14 49 Share-based compensation and non-cash incentive compensation expense 21 23 19 21 84 Depreciation and amortization 5 4 5 5 19 Corporate restructuring and tax advisory fees 1 7 3 5 16
General and administrative expenses
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