Jack in the Box same-store sales growth of
0.4%
Del Taco same-store sales of (4.5%)
Jack in the Box systemwide sales growth of
0.5%; Del Taco systemwide sales of (1.9%)
Diluted earnings per share of $1.75;
Operating EPS of $1.92
Jack in the Box completed development
agreements for 2 new franchisees to expand in Chicago, in addition
to the 8 company-owned restaurants set to begin opening in Summer
of 2025
Jack in the Box progressing on tech and
digital transformation with nearly 1,000 restaurants on our new POS
system, which includes immediate counter kiosk capabilities
Jack in the Box Inc. (NASDAQ: JACK) announced financial
results for the Jack in the Box and Del Taco brands in the first
quarter, ended January 19, 2025.
“The first quarter saw a good start to top-line performance and
bottom-line earnings flow through as we battled through a difficult
industry-wide macro environment,” said Lance Tucker, Jack in the
Box Interim Principal Executive Officer. “In my new role, I will be
continuing to assess capital allocation, investments and ways to
accelerate free cash flow — all while executing on our fundamentals
to ensure we regain our sales momentum as we move through
2025.”
Jack in the Box
Performance
Same-store sales increased 0.4% in the first quarter, comprised
of franchise same-store sales increase of 0.5% and company-owned
same-store sales decline of 0.4%. Price was higher versus prior
year, while both transactions and mix were down compared to prior
year, but were sequentially positive. Systemwide sales for the
first quarter increased 0.5%.
Restaurant-Level Margin(1), a non-GAAP measure, was $31.0
million, or 23.2%, up from $30.4 million, or 23.1%, a year ago
driven primarily by lower food and packaging costs, partially
offset by higher costs for labor and other restaurant operating
costs. The decrease in food and packaging was primarily due to a
favorable increase of beverage funding relating to a new contract,
a portion of which was one-time benefit. The increase in labor was
driven from implementing California's minimum wage law.
Franchise-Level Margin(1), a non-GAAP measure, was $97.1
million, or 40.9%, a decrease from $97.5 million, or 41.2%, a year
ago. The decrease was mainly driven by lower percentage rent,
partially offset by lower IT support costs as well as higher
royalties from higher sales.
Jack in the Box net restaurant count decreased slightly in the
first quarter, with five restaurant openings and six restaurant
closures. In the first quarter, Jack in the Box signed 3
development agreements with new franchisees for 10 new
restaurants.
Jack in the Box Same-Store
Sales:
16 Weeks Ended
January 19, 2025
January 21, 2024
Company
(0.4 %)
2.0 %
Franchise
0.5 %
0.7 %
System
0.4 %
0.8 %
Jack in the Box Restaurant
Counts:
2025
2024
Company
Franchise
Total
Company
Franchise
Total
Restaurant count at beginning FY
150
2,041
2,191
142
2,044
2,186
New
2
3
5
2
5
7
Closed
—
(6
)
(6
)
—
(1
)
(1
)
Restaurant count at end of Q1
152
2,038
2,190
144
2,048
2,192
Q1'25 QTD Net Restaurant
Increase/(Decrease)
2
(3
)
(1
)
YTD Net Restaurant Increase/(Decrease)
1.3
%
(0.1
)%
—
%
Del Taco
Performance
Same-store sales decreased 4.5% in the first quarter, comprised
of franchise same-store sales decline of 5.1% and company-operated
same-store sales decline of 2.5%. Sales performance resulted from
declines compared to prior year in both transactions and mix,
partially offset by an increase in price. Systemwide sales for the
fiscal first quarter decreased 1.9%.
Restaurant-Level Margin(1), a non-GAAP measure, was $9.3
million, or 13.8%, down from $14.4 million, or 15.6%, a year ago.
The decrease was due mainly to a decrease in restaurant count from
refranchising restaurants. The margin percentage decline was driven
by the increased costs for labor as a result of implementing
California's new minimum wage law and the change in the mix of
restaurants from refranchising, partially offset by lower food and
packaging as a result of menu price increases and favorable
beverage funding.
Franchise-Level Margin(1), a non-GAAP measure, was $7.9 million,
or 25.7%, compared to $8.0 million, or 29.3%, a year ago. The
decrease in margin percentage was driven by refranchising and the
associated impact of pass-thru rent and marketing fees.
Del Taco restaurant count in the first quarter had one
restaurant opening and six restaurant closings. As of the end of
the first quarter and since being acquired by Jack in the Box, Del
Taco has signed 40 agreements for a total of 303 restaurants, with
14 restaurants opened to date. During the first quarter, 13 Del
Taco company-owned restaurants were refranchised, which included a
development agreement for 12 new future restaurants. Del Taco also
completed a development agreement to enter Indianapolis, marking
its 12th new market announcement in the past three years.
Del Taco Same-Store Sales:
16 Weeks Ended
January 19, 2025
January 21, 2024
Company
(2.5 %)
1.8 %
Franchise
(5.1 %)
2.4 %
System
(4.5 %)
2.2 %
Del Taco Restaurant Counts:
2025
2024
Company
Franchise
Total
Company
Franchise
Total
Restaurant count at beginning FY
133
461
594
171
421
592
New
1
—
1
—
3
3
Acquired from franchisees
—
—
—
9
(9
)
—
Refranchised
(13
)
13
—
—
—
—
Closed
(2
)
(4
)
(6
)
(1
)
(2
)
(3
)
Restaurant count at end of Q1
119
470
589
179
413
592
Q1'25 QTD Net Restaurant
Increase/(Decrease)
(14
)
9
(5
)
YTD Net Restaurant Increase/(Decrease)
(10.5
)%
2.0
%
(0.8
)%
Company-Wide
Performance
First quarter diluted earnings per share was $1.75. Operating
Earnings Per Share(2), a non-GAAP measure, was $1.92 in the first
quarter of fiscal 2025 compared with $1.95 in the prior year
quarter.
Total revenues decreased 3.7% to $469.4 million, compared to
$487.5 million in the prior year quarter. The lower revenue is
primarily the result of the Del Taco refranchising transactions.
Net income was $33.7 million for the first quarter of fiscal 2025.
This compared with net earnings of $38.7 million for the first
quarter of the prior year. Adjusted EBITDA(3), a non-GAAP measure,
was $97.2 million in the first quarter of fiscal 2025 compared with
$101.8 million for the prior year quarter.
Company-wide SG&A expense for the first quarter was $50.7
million, a increase of $4.3 million compared to the prior year
quarter. The increase was due primarily to the fluctuations in the
cash surrender value of our company-owned life insurance policies,
partially offset by lower incentive-based compensation. When
excluding net COLI gains, G&A was 2.3% of systemwide sales.
The income tax provisions reflect a year-to-date effective tax
rate of 29.8% in the first quarter of 2025, as compared to 26.9% in
the first quarter of fiscal year 2024. The non-GAAP adjusted tax
rate for the first quarter of 2025 was 27.2%.
(1) Restaurant-Level Margin and
Franchise-Level Margin are non-GAAP measures. These non-GAAP
measures are reconciled to earnings from operations, the most
comparable GAAP measure, in the attachment to this release. See
"Reconciliation of Non-GAAP Measurements to GAAP Results."
(2) Operating Earnings Per Share
represents the diluted earnings per share on a GAAP basis,
excluding certain adjustments. See "Reconciliation of Non-GAAP
Measurements to GAAP Results." Operating earnings per share may not
add due to rounding.
(3) Adjusted EBITDA represents net
earnings on a GAAP basis excluding certain adjustments. See
"Reconciliation of Non-GAAP Measurements to GAAP Results."
Capital
Allocation
The Company repurchased 0.1 million shares of our common stock
for an aggregate cost of $5.0 million in the first quarter. As of
the end of the first quarter, there was $175.0 million remaining
under the Board-authorized stock buyback program.
On February 21, 2025, the Board of Directors declared a cash
dividend of $0.44 per share, to be paid on April 8, 2025, to
shareholders of record as of the close of business on March 20,
2025.
Guidance & Outlook
Updates
The following guidance and underlying assumptions reflect the
company’s current expectations for the fiscal year ending September
28, 2025. Any guidance measures not listed below remain the same as
provided on November 20, 2024.
• Capital Expenditures of $100-$105 million
(previously $105-115 million)
• Share repurchases of approximately $5
million in FY 2025 (previously approx. $20 million)
Conference Call
The Company will host a conference call for analysts and
investors on Tuesday, February 25, 2025, beginning at 2:00 p.m. PT
(5:00 p.m. ET). The call will be webcast live via the Investors
section of the Jack in the Box company website at
http://investors.jackinthebox.com. A replay of the call will be
available through the Jack in the Box Inc. corporate website for 21
days. The call can be accessed via phone by dialing (888) 596-4144
and using ID 7573961.
About Jack in the Box Inc.
Jack in the Box Inc. (NASDAQ: JACK), founded and headquartered
in San Diego, California, is a restaurant company that operates and
franchises Jack in the Box®, one of the nation's largest hamburger
chains with approximately 2,200 restaurants across 22 states, and
Del Taco®, the second largest Mexican-American QSR chain by units
in the U.S. with approximately 600 restaurants across 17 states.
For more information on both brands, including franchising
opportunities, visit www.jackinthebox.com and www.deltaco.com.
Category: Earnings
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of the federal securities laws. Forward-looking
statements may be identified by words such as “anticipate,”
“believe,” “estimate,” “expect,” “forecast,” “goals,” “guidance,”
“intend,” “plan,” “project,” “may,” “will,” “would” and similar
expressions. These statements are based on management’s current
expectations, estimates, forecasts and projections about our
business and the industry in which we operate. These estimates and
assumptions involve known and unknown risks, uncertainties, and
other factors that are in some cases beyond our control. Factors
that may cause our actual results to differ materially from any
forward-looking statements include, but are not limited to: the
success of new products, marketing initiatives and restaurant
remodels and drive-thru enhancements; the impact of competition,
unemployment, trends in consumer spending patterns and commodity
costs; the company’s ability to achieve and manage its planned
growth, which is affected by the availability of a sufficient
number of suitable new restaurant sites, the performance of new
restaurants, risks relating to expansion into new markets and
successful franchise development; the ability to attract, train and
retain top-performing personnel, litigation risks; risks associated
with disagreements with franchisees; supply chain disruption;
food-safety incidents or negative publicity impacting the
reputation of the company's brand; increased regulatory and legal
complexities, risks associated with the amount and terms of the
securitized debt issued by certain of our wholly owned
subsidiaries; and stock market volatility. These and other factors
are discussed in the company’s annual report on Form 10-K and its
periodic reports on Form 10-Q filed with the Securities and
Exchange Commission, which are available online at
http://investors.jackinthebox.com or in hard copy upon request. The
company undertakes no obligation to update or revise any
forward-looking statement, whether as the result of new information
or otherwise.
JACK IN THE BOX INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF EARNINGS
(In thousands, except per
share data)
(Unaudited)
16 Weeks Ended
January 19, 2025
January 21, 2024
Revenues:
Company restaurant sales
$
201,406
$
224,040
Franchise rental revenues
116,546
113,196
Franchise royalties and other
74,034
73,330
Franchise contributions for advertising
and other services
77,452
76,932
469,438
487,498
Operating costs and expenses, net:
Food and packaging
51,648
64,132
Payroll and employee benefits
70,273
73,054
Occupancy and other
39,146
42,053
Franchise occupancy expenses
78,833
72,624
Franchise support and other costs
5,198
5,194
Franchise advertising and other services
expenses
78,998
80,234
Selling, general and administrative
expenses
50,672
46,365
Depreciation and amortization
18,270
18,473
Pre-opening costs
1,476
465
Other operating expenses, net
3,519
5,170
(Gains) losses on the sale of
company-operated restaurants
(2,806
)
254
395,227
408,018
Earnings from operations
74,211
79,480
Other pension and post-retirement
expenses, net
1,789
2,106
Interest expense, net
24,425
24,486
Earnings before income taxes
47,997
52,888
Income taxes
14,311
14,205
Net earnings
$
33,686
$
38,683
Net earnings per share:
Basic
$
1.77
$
1.94
Diluted
$
1.75
$
1.93
Weighted-average shares outstanding:
Basic
19,050
19,893
Diluted
19,215
20,051
Dividends declared per common share
$
0.44
$
0.44
JACK IN THE BOX INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
and per share data)
(Unaudited)
January 19,
2025
September 29,
2024
ASSETS
Current assets:
Cash
$
74,978
$
24,745
Restricted cash
29,655
29,422
Accounts and other receivables, net
68,081
83,567
Inventories
3,856
3,922
Prepaid expenses
8,130
13,126
Assets held for sale
12,432
16,493
Other current assets
16,854
10,002
Total current assets
213,986
181,277
Property and equipment:
Property and equipment, at cost
1,293,448
1,278,530
Less accumulated depreciation and
amortization
(856,923
)
(848,491
)
Property and equipment, net
436,525
430,039
Other assets:
Operating lease right-of-use assets
1,416,958
1,410,083
Intangible assets, net
10,270
10,515
Trademarks
283,500
283,500
Goodwill
161,344
161,209
Other assets, net
251,321
259,006
Total other assets
2,123,393
2,124,313
$
2,773,904
$
2,735,629
LIABILITIES AND STOCKHOLDERS’
DEFICIT
Current liabilities:
Current maturities of long-term debt
$
29,725
$
35,880
Current operating lease liabilities
159,219
162,017
Accounts payable
69,394
69,494
Accrued liabilities
168,359
166,868
Total current liabilities
426,697
434,259
Long-term liabilities:
Long-term debt, net of current
maturities
1,693,453
1,699,433
Long-term operating lease liabilities, net
of current portion
1,290,800
1,286,415
Deferred tax liabilities
11,624
13,612
Other long-term liabilities
178,461
153,708
Total long-term liabilities
3,174,338
3,153,168
Stockholders’ deficit:
Preferred stock $0.01 par value,
15,000,000 shares authorized, none issued
—
—
Common stock $0.01 par value, 175,000,000
shares authorized, 82,971,349 and 82,825,851 issued and
outstanding, respectively
829
828
Capital in excess of par value
537,568
533,818
Retained earnings
1,891,977
1,866,660
Accumulated other comprehensive loss
(56,880
)
(57,475
)
Treasury stock, at cost, 64,120,270 and
63,996,399 shares, respectively
(3,200,625
)
(3,195,629
)
Total stockholders’ deficit
(827,131
)
(851,798
)
$
2,773,904
$
2,735,629
JACK IN THE BOX INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Sixteen Weeks Ended
January 19, 2025
January 21, 2024
Cash flows from operating activities:
Net earnings
$
33,686
$
38,683
Adjustments to reconcile net earnings to
net cash provided by (used in) operating activities:
Depreciation and amortization
18,270
18,473
Amortization of franchise tenant
improvement allowances and incentives
1,655
1,418
Deferred finance cost amortization
1,473
1,493
Excess tax deficiency (benefit) from
share-based compensation arrangements
1,111
(9
)
Deferred income taxes
(5,018
)
(719
)
Share-based compensation expense
3,689
4,820
Pension and post-retirement expense
1,789
2,106
Gains on cash surrender value of
company-owned life insurance
(189
)
(6,161
)
(Gains) losses on the sale of
company-operated restaurants
(2,806
)
254
Gains on acquisition of restaurants
(6
)
(2,357
)
Losses on the disposition of property and
equipment, net
521
1,011
Impairment charges and other
736
28
Changes in assets and liabilities:
Accounts and other receivables
17,822
40,139
Inventories
66
(484
)
Prepaid expenses and other current
assets
(1,892
)
9,587
Operating lease right-of-use assets and
lease liabilities
(5,788
)
12,208
Accounts payable
4,776
(13,826
)
Accrued liabilities
6,684
(125,861
)
Pension and post-retirement
contributions
(2,218
)
(1,698
)
Franchise tenant improvement allowance and
incentive disbursements
(1,924
)
(523
)
Other
33,219
(1,257
)
Cash flows provided by (used in) operating
activities
105,656
(22,675
)
Cash flows from investing activities:
Purchases of property and equipment
(35,099
)
(38,829
)
Proceeds from the sale of property and
equipment
—
516
Proceeds from the sale of company-operated
restaurants
5,712
1,739
Other
3,303
—
Cash flows used in investing
activities
(26,084
)
(36,574
)
Cash flows from financing activities:
Repayments of borrowings on revolving
credit facilities
(6,000
)
—
Principal repayments on debt
(7,464
)
(7,481
)
Dividends paid on common stock
(8,308
)
(8,652
)
Proceeds from issuance of common stock
1
1
Repurchases of common stock
(4,999
)
(25,000
)
Payroll tax payments for equity award
issuances
(2,336
)
(2,992
)
Cash flows used in financing
activities
(29,106
)
(44,124
)
Net increase (decrease) in cash and
restricted cash
50,466
(103,373
)
Cash and restricted cash at beginning of
period
54,167
185,907
Cash and restricted cash at end of
period
$
104,633
$
82,534
JACK IN THE BOX INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION CONDENSED CONSOLIDATED
STATEMENTS OF EARNINGS DATA (Unaudited)
The following table presents certain income and expense items
included in our condensed consolidated statements of earnings as a
percentage of total revenues, unless otherwise indicated.
Percentages may not add due to rounding.
16 Weeks Ended
January 19, 2025
January 21, 2024
Revenues:
Company restaurant sales
42.9 %
46.0 %
Franchise rental revenues
24.8 %
23.2 %
Franchise royalties and other
15.8 %
15.0 %
Franchise contributions for advertising
and other services
16.5 %
15.8 %
100.0 %
100.0 %
Operating costs and expenses, net:
Food and packaging (1)
25.6 %
28.6 %
Payroll and employee benefits (1)
34.9 %
32.6 %
Occupancy and other (1)
19.4 %
18.8 %
Franchise occupancy expenses (2)
67.6 %
64.2 %
Franchise support and other costs (3)
7.0 %
7.1 %
Franchise advertising and other services
expenses (4)
102.0 %
104.3 %
Selling, general and administrative
expenses
10.8 %
9.5 %
Depreciation and amortization
3.9 %
3.8 %
Pre-opening costs
0.3 %
0.1 %
Other operating expenses, net
0.7 %
1.1 %
(Gains) losses on the sale of
company-operated restaurants
(0.6) %
0.1 %
Earnings from operations
15.8 %
16.3 %
Income tax rate (5)
29.8 %
26.9 %
____________________________
(1)
As a percentage of company restaurant
sales.
(2)
As a percentage of franchise rental
revenues.
(3)
As a percentage of franchise royalties and
other.
(4)
As a percentage of franchise contributions
for advertising and other services.
(5)
As a percentage of earnings from
operations and before income taxes.
Jack in the Box systemwide sales (in
thousands):
16 Weeks Ended
January 19, 2025
January 21, 2024
Company-operated restaurant sales
$
133,755
$
132,057
Franchised restaurant sales (1)
1,232,347
1,226,750
Systemwide sales (1)
$
1,366,102
$
1,358,807
Del Taco systemwide sales (in
thousands):
16 Weeks Ended
January 19, 2025
January 21, 2024
Company-operated restaurant sales
$
67,651
$
91,983
Franchised restaurant sales (1)
217,283
198,476
Systemwide sales (1)
$
284,934
$
290,459
____________________________
(1)
Franchised restaurant sales represent
sales at franchised restaurants and are revenues of our
franchisees. Systemwide sales include company and franchised
restaurant sales. We do not record franchised sales as revenues;
however, our royalty revenues, marketing fees and percentage rent
revenues are calculated based on a percentage of franchised sales.
We believe franchised and systemwide restaurant sales information
is useful to investors as they have a direct effect on the
company's profitability.
JACK IN THE BOX INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASUREMENTS TO GAAP RESULTS
(Unaudited)
To supplement the condensed consolidated financial statements,
which are presented in accordance with GAAP, the company uses the
following non-GAAP measures: Adjusted Net Income, Operating
Earnings Per Share, Adjusted EBITDA, Restaurant-Level Margin and
Franchise-Level Margin. Management believes that these
measurements, when viewed with the company's results of operations
in accordance with GAAP and the accompanying reconciliations in the
tables below, provide useful information about operating
performance and period-over-period changes, and provide additional
information that is useful for evaluating the operating performance
of the company's core business without regard to potential
distortions.
Operating Earnings Per Share
Operating Earnings Per Share represents diluted earnings per
share on a GAAP basis excluding integration and strategic
initiatives, net COLI gains, pension and post-retirement benefit
costs, losses (gains) on the sale of company-operated restaurants,
excess tax (benefits) shortfall from share-based compensation
arrangements, and the tax-related impacts of the above
adjustments.
Operating Earnings Per Share should be considered as a
supplement to, not as a substitute for, analysis of results as
reported under U.S. GAAP or other similarly titled measures of
other companies. Management believes Operating Earnings Per Share
provides investors with a meaningful supplement of the company’s
operating performance and period-over-period changes without regard
to potential distortions.
Below is a reconciliation of Non-GAAP Adjusted Net Income to the
most directly comparable GAAP measure of net income. Also below is
a reconciliation of Non-GAAP Operating Earnings Per Share to the
most directly comparable GAAP measure, diluted earnings per
share:
16 Weeks Ended
January 19, 2025
January 21, 2024
Net income, as reported
$
33,686
$
38,683
Integration and strategic initiatives
(1)
1,415
5,621
Net COLI gains (2)
1,391
(4,834
)
Pension and post-retirement benefit costs
(3)
1,789
2,106
Restaurant impairment charges
748
—
(Gain) losses on the sale of
company-operated restaurants (4)
(2,806
)
254
Losses on the sale of real estate to
franchisees
—
1
Gains on acquisition of restaurants
(6
)
(2,357
)
Excess tax shortfall (benefit) from
share-based compensation arrangements
1,110
(10
)
Tax impact of adjustments (5)
(523
)
(371
)
Non-GAAP Adjusted Net Income
$
36,804
$
39,093
Weighted-average shares outstanding -
diluted
19,215
20,051
Diluted earnings per share – GAAP
$
1.75
$
1.93
Integration and strategic initiatives
(1)
0.07
0.28
Net COLI gains (2)
0.07
(0.24
)
Pension and post-retirement benefit costs
(3)
0.09
0.11
Restaurant impairment charges
0.04
—
(Gain) losses on the sale of
company-operated restaurants (4)
(0.15
)
0.01
Losses on the sale of real estate to
franchisees
—
0.00
Gains on acquisition of restaurants
0.00
(0.12
)
Excess tax (benefits) shortfall from
share-based compensation arrangements
0.06
(0.00
)
Tax impact of adjustments (5)
(0.03
)
(0.02
)
Operating Earnings Per Share – non-GAAP
(6)
$
1.92
$
1.95
____________________
(1) Integration and strategic initiatives
reflect charges that are not part of our ongoing operations,
including consulting fees for discrete project-based strategic
initiatives that are not expected to recur in the foreseeable
future.
(2) Net COLI gains reflect market-based
adjustments on the company-owned life insurance policies, net of
changes in our non-qualified deferred compensation obligation
supported by these policies.
(3) Pension and post-retirement benefit
costs relating to our two legacy defined benefit pension plans, as
well as our two legacy post-retirement plans.
(4) Losses (gains) on the sale of
company-operated restaurants
(5) Tax impacts for the quarter calculated
based on the non-GAAP Operating EPS tax rate of 27.2% in the
current quarter and 27.2% in the prior year quarter.
(6) Operating Earnings Per Share may not
add due to rounding.
Adjusted EBITDA
Adjusted EBITDA represents net earnings on a GAAP basis
excluding income taxes, interest expense, net, losses (gains) on
the sale of company-operated restaurants, other operating expenses
(income), net, depreciation and amortization, amortization of cloud
computing costs, amortization of favorable and unfavorable leases
and subleases, net, amortization of franchise tenant improvement
allowances and other, net COLI gains, and pension and
post-retirement benefit costs.
Adjusted EBITDA should be considered as a supplement to, not as
a substitute for, analysis of results as reported under U.S. GAAP
or other similarly titled measures of other companies. Management
believes Adjusted EBITDA is useful to investors to gain an
understanding of the factors and trends affecting the company's
ongoing cash earnings, from which capital investments are made and
debt is serviced.
Below is a reconciliation of non-GAAP Adjusted EBITDA to the
most directly comparable GAAP measure, net earnings (in
thousands):
16 Weeks Ended
January 19, 2025
January 21, 2024
Net income - GAAP
$
33,686
$
38,683
Income taxes
14,311
14,205
Interest expense, net
24,425
24,486
(Gains) losses on the sale of
company-operated restaurants
(2,806
)
254
Other operating expenses, net (1)
3,519
5,170
Depreciation and amortization
18,270
18,473
Amortization of cloud-computing costs
(2)
1,002
1,606
Amortization of favorable and unfavorable
leases and subleases, net (3)
2
124
Amortization of franchise tenant
improvement allowances and other
1,655
1,511
Net COLI gains (4)
1,391
(4,834
)
Pension and post-retirement benefit costs
(5)
1,789
2,106
Adjusted EBITDA – non-GAAP
$
97,244
$
101,784
(1) Other operating expense, net includes:
integration and strategic initiatives; costs of closed restaurants;
operating restaurant impairment charges; accelerated depreciation
and gains/losses on disposition of property and equipment, net.
(2) Amortization of cloud computing costs
includes the amounts for the non-cash amortization of capitalized
implementation costs related to cloud-based software arrangements
that are included within selling, general and administrative
expenses.
(3) Amortization of favorable and
unfavorable leases and subleases, net, which is not already
included in the other operating expense, net, noted above.
(4) Net COLI gains reflect market-based
adjustments on the company-owned life insurance policies, net of
changes in our non-qualified deferred compensation obligation
supported by these policies.
(5) Pension and post-retirement benefit
costs relating to our two legacy defined benefit pension plans, as
well as the two legacy post-retirement plans.
Restaurant-Level Margin
Restaurant-Level Margin is defined as company restaurant sales
less restaurant operating costs (food and packaging, labor, and
occupancy costs) and is neither required by, nor presented in
accordance with GAAP. Restaurant-Level Margin excludes revenues and
expenses of our franchise operations and selling, general, and
administrative expenses. Certain other costs, such as depreciation
and amortization, other operating expenses, net, gains/ losses on
the sale of company-operated restaurants, and other costs that are
considered normal operating costs are excluded as they are
considered corporate-level shared service costs. As such,
Restaurant-Level Margin is not indicative of the overall results of
the company and does not accrue directly to the benefit of
shareholders because of the exclusion of corporate-level expenses.
Restaurant-Level Margin should be considered as a supplement to,
not as a substitute for, analysis of results as reported under GAAP
or other similarly titled measures of other companies. The company
is presenting Restaurant-Level Margin because it believes that it
provides a meaningful supplement to net earnings of the company's
core business operating results, as well as a comparison to those
of other similar companies. Management utilizes Restaurant-Level
Margin as a key performance indicator to evaluate the profitability
of company-operated restaurants.
Below is a reconciliation of non-GAAP Restaurant-Level Margin to
the most directly comparable GAAP measure, earnings from operations
(in thousands):
16 weeks ended January 19,
2025
Jack in the Box
Del Taco
Other (1)
Total (2)
Earnings from operations - GAAP
$
113,151
$
10,546
$
(49,485
)
$
74,212
Franchise rental revenues
(105,781
)
(10,765
)
—
(116,546
)
Franchise royalties and other
(63,615
)
(10,419
)
—
(74,034
)
Franchise contributions for advertising
and other services
(67,913
)
(9,539
)
—
(77,452
)
Franchise occupancy expenses
67,916
10,916
—
78,832
Franchise support and other costs
3,301
1,897
—
5,198
Franchise advertising and other services
expenses
68,992
10,007
—
78,999
Selling, general and administrative
expenses
12,274
8,597
29,800
50,671
Depreciation and amortization
—
—
18,270
18,270
Pre-opening costs
1,457
19
—
1,476
Other operating expenses, net
1,216
888
1,415
3,519
Gains on the sale of company-operated
restaurants
—
(2,806
)
—
(2,806
)
Restaurant-Level Margin - Non-GAAP
$
30,998
$
9,341
$
—
$
40,339
Company restaurant sales
$
133,755
$
67,651
$
—
$
201,406
Restaurant-Level Margin % - Non-GAAP
23.2
%
13.8
%
N/A
20.0
%
16 weeks ended January 21,
2024
Jack in the Box
Del Taco
Other (1)
Total (2)
Earnings from operations - GAAP
$
117,707
$
11,073
$
(49,300
)
$
79,480
Franchise rental revenues
(105,578
)
(7,618
)
—
(113,196
)
Franchise royalties and other
(63,343
)
(9,987
)
—
(73,330
)
Franchise contributions for advertising
and other services
(67,362
)
(9,569
)
—
(76,931
)
Franchise occupancy expenses
65,188
7,436
—
72,624
Franchise support and other costs
3,747
1,446
—
5,193
Franchise advertising and other services
expenses
69,893
10,341
—
80,234
Selling, general and administrative
expenses
10,841
10,316
25,117
46,274
Depreciation and amortization
—
—
18,473
18,473
Pre-opening costs
343
122
—
465
Other operating expenses, net
667
(1,117
)
5,710
5,260
(Gains) losses on the sale of
company-operated restaurants
(1,655
)
1,909
—
254
Restaurant-Level Margin - Non-GAAP
$
30,448
$
14,352
$
—
$
44,800
Company restaurant sales
$
132,057
$
91,983
$
—
$
224,040
Restaurant-Level Margin % - Non-GAAP
23.1
%
15.6
%
N/A
20.0
%
(1) The "Other" category includes shared
services costs and other unallocated costs
(2) The totals might not agree to
consolidated within the Form 10-Q due to rounding.
Franchise-Level Margin
Franchise-Level Margin is defined as franchise revenues less
franchise operating costs (occupancy expenses, advertising
contributions, and franchise support and other costs) and is
neither required by, nor presented in accordance with GAAP.
Franchise-Level Margin excludes revenue and expenses of our
company-operated restaurants and selling, general, and
administrative expenses. Certain other costs, such as depreciation
and amortization, other operating expenses, net, gains/ losses on
the sale of company-operated restaurants, and other costs that are
considered normal operating costs are excluded as they are
considered corporate-level shared service costs. As such,
Franchise-Level Margin is not indicative of the overall results of
the company and does not accrue directly to the benefit of
shareholders because of the exclusion of corporate-level expenses.
Franchise-Level Margin should be considered as a supplement to, not
as a substitute for, analysis of results as reported under GAAP or
other similarly titled measures of other companies. The company is
presenting Franchise-Level Margin because it believes that it
provides a meaningful supplement to net earnings of the company's
core business operating results, as well as a comparison to those
of other similar companies. Management utilizes Franchise-Level
Margin as a key performance indicator to evaluate the profitability
of our franchise operations.
Below is a reconciliation of non-GAAP Franchise-Level Margin to
the most directly comparable GAAP measure, earnings from operations
(in thousands):
16 weeks ended January 19,
2025
Jack in the Box
Del Taco
Other (1)
Total (2)
Earnings from operations - GAAP
$
113,151
$
10,546
$
(49,485
)
$
74,212
Company restaurant sales
(133,755
)
(67,651
)
—
(201,406
)
Food and packaging
34,690
16,959
—
51,649
Payroll and employee benefits
44,528
25,745
—
70,273
Occupancy and other
23,540
15,606
—
39,146
Selling, general and administrative
expenses
12,274
8,597
29,800
50,671
Depreciation and amortization
—
—
18,270
18,270
Pre-opening costs
1,457
19
—
1,476
Other operating expenses, net
1,216
888
1,415
3,519
Gains on the sale of company-operated
restaurants
—
(2,806
)
—
(2,806
)
Franchise-Level Margin - Non-GAAP
$
97,101
$
7,903
$
—
$
105,004
Franchise rental revenues
$
105,781
$
10,765
$
—
$
116,546
Franchise royalties and other
63,615
10,419
—
74,034
Franchise contributions for advertising
and other services
67,913
9,539
—
77,452
Total franchise revenues
$
237,309
$
30,723
$
—
$
268,032
Franchise-Level Margin % - Non-GAAP
40.9
%
25.7
%
N/A
39.2
%
16 weeks ended January 21,
2024
Jack in the Box
Del Taco
Other (1)
Total (2)
Earnings from operations - GAAP
$
117,707
$
11,073
$
(49,300
)
$
79,480
Company restaurant sales
(132,057
)
(91,983
)
—
(224,040
)
Food and packaging
39,261
24,872
—
64,133
Payroll and employee benefits
40,689
32,366
—
73,055
Occupancy and other
21,659
20,394
—
42,053
Selling, general and administrative
expenses
10,841
10,316
25,117
46,274
Depreciation and amortization
—
—
18,473
18,473
Pre-opening costs
343
122
—
465
Other operating expenses, net
667
(1,117
)
5,710
5,260
(Gains) losses on the sale of
company-operated restaurants
(1,655
)
1,909
—
254
Franchise-Level Margin - Non-GAAP
$
97,455
$
7,952
$
—
$
105,407
Franchise rental revenues
$
105,578
$
7,618
$
—
$
113,196
Franchise royalties and other
63,343
9,987
—
73,330
Franchise contributions for advertising
and other services
67,362
9,569
—
76,931
Total franchise revenues
$
236,283
$
27,174
$
—
$
263,457
Franchise-Level Margin % - Non-GAAP
41.2
%
29.3
%
N/A
40.0
%
(1) The "Other" category includes shared
services costs and other unallocated costs
(2) The totals might not agree to
consolidated within the Form 10-Q due to rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250225534675/en/
Chris Brandon Vice President, Investor Relations
chris.brandon@jackinthebox.com 619.902.0269
Jack in the Box (NASDAQ:JACK)
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