2019 Form 10-K Financial Statement

#000155837020001393 Filed on February 26, 2020

View on sec.gov

Income Statement

Concept 2019 2018 Q4 2018 Q3
Revenue $1.619B $397.6M $385.2M
YoY Change -2.62% -14.98% -10.76%
Cost Of Revenue $1.153B $293.5M $309.4M
YoY Change -5.52% -22.17% -11.52%
Gross Profit $466.1M $104.1M $120.5M
YoY Change 5.38% 15.03% 46.95%
Gross Profit Margin 28.78% 26.18% 31.28%
Selling, General & Admin $277.8M $58.90M $39.00M
YoY Change 9.21% 44.36% 4.56%
% of Gross Profit 59.59% 56.58% 32.37%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $47.28M $11.50M $11.59M
YoY Change 1.89% 0.88% 3.44%
% of Gross Profit 10.14% 11.05% 9.61%
Operating Expenses $277.8M $113.0M $93.50M
YoY Change 9.21% 116.48% 92.78%
Operating Profit $24.54M -$7.326M -$14.17M
YoY Change -22.24% -119.13% -142.3%
Interest Expense $20.59M -$7.926M -$6.058M
YoY Change -19.79% 76.13% 133.0%
% of Operating Profit 83.93%
Other Income/Expense, Net
YoY Change
Pretax Income $5.046M -$15.25M -$20.23M
YoY Change -24.65% -147.51% -165.46%
Income Tax -$611.0K -$2.027M -$7.367M
% Of Pretax Income -12.11%
Net Earnings $4.866M -$12.87M -$13.30M
YoY Change 96.69% -145.15% -161.01%
Net Earnings / Revenue 0.3% -3.24% -3.45%
Basic Earnings Per Share -$0.24 -$0.41 -$0.42
Diluted Earnings Per Share -$0.24 -$0.41 -$0.42
COMMON SHARES
Basic Shares Outstanding 31.63M 31.57M
Diluted Shares Outstanding 31.63M 31.57M

Balance Sheet

Concept 2019 2018 Q4 2018 Q3
SHORT-TERM ASSETS
Cash & Short-Term Investments $27.90M $33.30M $25.70M
YoY Change -16.22% 49.33% -34.94%
Cash & Equivalents $27.90M $33.26M $34.52M
Short-Term Investments
Other Short-Term Assets $33.40M $5.678M $36.70M
YoY Change -7.22% -87.12% 14.69%
Inventory $27.50M $27.20M $27.10M
Prepaid Expenses $30.38M
Receivables $80.90M $78.12M $63.00M
Other Receivables $11.80M $21.70M $5.200M
Total Short-Term Assets $181.5M $196.3M $157.7M
YoY Change -7.54% 15.46% -5.91%
LONG-TERM ASSETS
Property, Plant & Equipment $369.4M $226.9M $227.7M
YoY Change 62.8% -3.17% -3.84%
Goodwill $84.52M
YoY Change -2.73%
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $66.50M $63.81M $72.00M
YoY Change 2.31% 30.77% 47.54%
Total Long-Term Assets $549.2M $399.6M $400.5M
YoY Change 37.44% 3.64% 4.49%
TOTAL ASSETS
Total Short-Term Assets $181.5M $196.3M $157.7M
Total Long-Term Assets $549.2M $399.6M $400.5M
Total Assets $730.7M $595.9M $558.2M
YoY Change 22.62% 7.25% 1.33%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $29.10M $27.11M $33.30M
YoY Change 7.38% -15.29% -12.83%
Accrued Expenses $88.70M $129.2M $81.20M
YoY Change 52.67% 83.78% 17.0%
Deferred Revenue $6.022M
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $21.80M $20.01M $20.00M
YoY Change 9.0% 0.05% 0.0%
Total Short-Term Liabilities $207.9M $188.9M $145.8M
YoY Change 10.06% 42.13% 5.58%
LONG-TERM LIABILITIES
Long-Term Debt $354.9M $601.1M $556.4M
YoY Change -40.96% 34.6% 47.0%
Other Long-Term Liabilities $224.9M $79.32M $93.80M
YoY Change 132.82% 26.31% 51.53%
Total Long-Term Liabilities $579.8M $680.5M $650.2M
YoY Change -16.9% 33.58% 47.64%
TOTAL LIABILITIES
Total Short-Term Liabilities $207.9M $188.9M $145.8M
Total Long-Term Liabilities $579.8M $680.5M $650.2M
Total Liabilities $811.9M $894.4M $824.7M
YoY Change -11.28% 32.06% 35.15%
SHAREHOLDERS EQUITY
Retained Earnings $242.2M
YoY Change
Common Stock $443.0K
YoY Change
Preferred Stock
YoY Change
Treasury Stock (at cost) $751.7M
YoY Change
Treasury Stock Shares $12.93M
Shareholders Equity -$81.20M -$319.2M -$266.5M
YoY Change
Total Liabilities & Shareholders Equity $730.7M $595.9M $558.2M
YoY Change 22.62% 7.25% 1.33%

Cashflow Statement

Concept 2019 2018 Q4 2018 Q3
OPERATING ACTIVITIES
Net Income $4.866M -$12.87M -$13.30M
YoY Change 96.69% -145.15% -161.01%
Depreciation, Depletion And Amortization $47.28M $11.50M $11.59M
YoY Change 1.89% 0.88% 3.44%
Cash From Operating Activities $61.75M -$12.50M $36.70M
YoY Change -33.21% -162.19% -0.81%
INVESTING ACTIVITIES
Capital Expenditures $37.71M -$11.40M -$12.30M
YoY Change -10.27% 21.28% -3.15%
Acquisitions
YoY Change
Other Investing Activities -$1.889M -$5.000M -$200.0K
YoY Change 949.44% 6.38% -300.0%
Cash From Investing Activities -$32.58M -$16.40M -$12.50M
YoY Change -16.04% 16.31% -0.79%
FINANCING ACTIVITIES
Cash Dividend Paid $40.90M
YoY Change 41.03%
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -34.57M 27.90M -39.90M
YoY Change -28.12% -219.74% 446.58%
NET CHANGE
Cash From Operating Activities 61.75M -12.50M 36.70M
Cash From Investing Activities -32.58M -16.40M -12.50M
Cash From Financing Activities -34.57M 27.90M -39.90M
Net Change In Cash -5.347M -1.000M -15.70M
YoY Change -199.63% -94.22% -191.81%
FREE CASH FLOW
Cash From Operating Activities $61.75M -$12.50M $36.70M
Capital Expenditures $37.71M -$11.40M -$12.30M
Free Cash Flow $24.04M -$1.100M $49.00M
YoY Change -52.33% -103.73% -1.41%

Facts In Submission

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<p style="font-family:'Times New Roman';font-size:12pt;margin:0pt;"><span style="font-size:10pt;visibility:hidden;">​</span></p><p style="font-family:'Times New Roman';font-size:10pt;margin:0pt;"><b style="font-weight:bold;white-space:pre-wrap;">1. Description of Business</b></p><p style="font-family:'Times New Roman';font-size:12pt;margin:0pt;"><span style="font-size:10pt;visibility:hidden;">​</span></p><p style="font-family:'Times New Roman';font-size:10pt;text-align:justify;margin:0pt;">Papa John’s International, Inc. (referred to as the “Company,” “Papa John’s” or in the first person notations of “we,” “us” and “our”), operates and franchises pizza delivery and carryout restaurants under the trademark “Papa John’s,” in 49 countries and territories as of December 29, 2019. Substantially all revenues are derived from retail sales of pizza and other food and beverage products by Company-owned restaurants, franchise royalties, sales of franchise and development rights, and sales to franchisees of food and paper products, printing and promotional items and information systems and related services used in their operations.</p>
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CY2019 pzza Prior Period Restatement Description Policy Textblock
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<p style="font-family:'Times New Roman';font-size:10pt;text-align:justify;margin:0pt;"><i style="font-style:italic;">Restatement of Previously Issued Consolidated Financial Statements for Immaterial Error Correction</i></p><p style="font-family:'Times New Roman';font-size:12pt;text-align:justify;margin:0pt;"><span style="font-size:10pt;visibility:hidden;">​</span></p><p style="font-family:'Times New Roman';font-size:10pt;text-align:justify;margin:0pt;">Papa John’s domestic restaurants, both Company-owned and franchised, participate in Papa John’s Marketing Fund, Inc. (“PJMF”), a nonstock corporation that is designed to break even as it spends all annual contributions received from the system.  PJMF collects a percentage of revenues from Company-owned and franchised restaurants in the United States for the purpose of designing and administering advertising and promotional programs. PJMF is a variable interest entity (“VIE”) that funds its operations with ongoing financial support and contributions from the domestic restaurants, of which approximately 80% are franchised.  </p><p style="font-family:'Times New Roman';font-size:12pt;text-align:justify;margin:0pt;"><span style="font-size:10pt;visibility:hidden;">​</span></p><p style="font-family:'Times New Roman';font-size:10pt;text-align:justify;margin:0pt;">During the first quarter of 2019, the Company reassessed the governance structure and operating procedures of PJMF and determined that the Company has the power to control certain significant activities of PJMF, as defined by Accounting Standards Codification 810 (“ASC 810”), <i style="font-style:italic;">Consolidations</i>.  Therefore, the Company is the primary beneficiary of PJMF, and per ASC 810, must consolidate the VIE.  Prior to 2019, the Company did not consolidate PJMF despite having power to control certain significant activities of PJMF.  The Company has concluded the previous conclusion to not consolidate PJMF was an immaterial error and the Company has corrected this immaterial error by restating the 2018 consolidated financial statements and related notes included herein to include PJMF. See Note 27 for the immaterial impacts of this error correction in fiscal year 2018.  Fiscal year 2017 was not restated, as consolidating PJMF was not material to the results of operations.</p>
CY2019Q4 pzza Percentage Of Business Units Franchised
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CY2019 us-gaap Fiscal Period
FiscalPeriod
<p style="font-family:'Times New Roman';font-size:10pt;text-align:justify;margin:0pt;"><i style="font-style:italic;">Fiscal Year</i></p><p style="font-family:'Times New Roman';font-size:12pt;text-align:justify;margin:0pt;"><span style="font-size:10pt;visibility:hidden;">​</span></p><p style="font-family:'Times New Roman';font-size:12pt;text-align:justify;margin:0pt;"><span style="font-size:10pt;">Our fiscal year ends on the last Sunday in December of each year. All fiscal years presented consist of </span><span style="font-size:10pt;">52</span><span style="font-size:10pt;"> weeks except for the 2017 fiscal year, which consisted of </span><span style="font-size:10pt;">53</span><span style="font-size:10pt;"> weeks.</span></p>
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CY2019 us-gaap Fiscal Period Duration
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CY2019 us-gaap Use Of Estimates
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<p style="font-family:'Times New Roman';font-size:10pt;text-align:justify;margin:0pt;"><i style="font-style:italic;">Use of Estimates</i></p><p style="font-family:'Times New Roman';font-size:12pt;text-align:justify;margin:0pt;"><span style="font-size:10pt;visibility:hidden;">​</span></p><p style="font-family:'Times New Roman';font-size:10pt;text-align:justify;margin:0pt;">The preparation of Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Significant items that are subject to such estimates and assumptions include allowance for doubtful accounts and notes receivable, intangible assets, contract assets and contract liabilities including the customer loyalty program obligation, right-of-use assets and lease liabilities, gift card breakage, insurance reserves and tax reserves. Although management bases its estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, actual results could significantly differ from these estimates.</p>
CY2019 pzza Term Of Franchise Agreement
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CY2019 pzza Term Of Franchise Agreement
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CY2019Q4 pzza Percentage Of Business Units Franchised
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CY2018 pzza Decrease Increase In Income Tax Expense From Prior Period
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CY2019Q4 pzza Number Of Joint Ventures Having Noncontrolling Interests
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CY2019Q4 pzza Number Of Joint Ventures Having Noncontrolling Interests
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CY2019Q4 pzza Number Of Joint Ventures Having Noncontrolling Interests
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CY2018Q4 pzza Number Of Joint Ventures Having Noncontrolling Interests
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CY2019Q4 pzza Refranchising Of Owned Restaurants
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CY2019 pzza Effective Income Tax Rate Reconciliation Deduction Equity Awards
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CY2018 pzza Effective Income Tax Rate Reconciliation Deduction Equity Awards
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CY2017 pzza Effective Income Tax Rate Reconciliation Deduction Equity Awards
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CY2018Q4 us-gaap Unrecognized Tax Benefits Income Tax Penalties And Interest Accrued
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CY2017 us-gaap Stock Issued During Period Shares Stock Options Exercised
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CY2017 pzza Deferred Tax Benefit From Stock Options Exercised
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