What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-11-03 compared with 2021-08-05 · 216 added, 214 removed, 784 unchanged (35% of the section changed)

2 unchanged sentences

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA, UNAUDITED)

JUNE 27, 2021 DECEMBER 27, 2020

SEPTEMBER 26, 2021 DECEMBER 27, 2020

Current assets

26 unchanged sentences

Preferred stock, $ 0.01 par value, 25,000,000 shares authorized;

no shares issued and outstanding as of June 27, 2021 and December 27, 2020

no shares issued and outstanding as of September 26, 2021 and December 27, 2020

Common stock, $ 0.01 par value, 475,000,000 shares authorized;

89,210,729 and 87,855,571 shares issued and outstanding as of June 27, 2021 and December 27, 2020, respectively

89,248,056 and 87,855,571 shares issued and outstanding as of September 26, 2021 and December 27, 2020, respectively

Additional paid-in capital 1,115,464 1,132,808

9 unchanged sentences

(IN THOUSANDS, EXCEPT PER SHARE DATA, UNAUDITED)

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Restaurant sales $ 996,718 $ 766,487 $ 3,031,396 $ 2,338,985

13 unchanged sentences

Interest expense, net ( 14,245 ) ( 18,300 ) ( 43,863 ) ( 46,647 )

Income (loss) before provision (benefit) for income taxes 107,574 ( 128,207 ) 183,965 ( 182,276 )

Provision (benefit) for income taxes 22,688 ( 35,779 ) 29,281 ( 55,434 )

Income (loss) before (benefit) provision for income taxes 597 ( 32,554 ) 184,562 ( 214,830 )

(Benefit) provision for income taxes ( 4,454 ) ( 14,776 ) 24,827 ( 70,210 )

Net income (loss) 5,051 ( 17,778 ) 159,735 ( 144,620 )

7 unchanged sentences

Foreign currency translation adjustment 1,673 ( 4,095 ) 5,113 ( 41,202 )

Unrealized loss on derivatives, net of tax ( 128 ) ( 1,556 ) ( 170 ) ( 14,892 )

Unrealized (loss) gain on derivatives, net of tax ( 153 ) 261 ( 323 ) ( 14,631 )

Reclassification of adjustments for loss on derivatives included in Net income (loss), net of tax 1,519 2,962 6,036 6,943

18 unchanged sentences

SHARES AMOUNT

Balance, March 28, 2021 88,855 $ 889 $ 1,097,639 $ ( 844,864 ) $ ( 215,060 ) $ 6,801 $ 45,405

Balance, June 27, 2021 89,211 $ 892 $ 1,109,904 $ ( 762,319 ) $ ( 202,188 ) $ 6,618 $ 152,907

Net income — — — 3,449 — 1,602 5,051

2 unchanged sentences

Common stock issued under stock plans (1) 37 — ( 42 ) — — — ( 42 )

Purchase of noncontrolling interests — — 9 — — ( 12 ) ( 3 )

Distributions to noncontrolling interests — — — — — ( 2,062 ) ( 2,062 )

Contributions from noncontrolling interests — — — — — 374 374

Balance, June 27, 2021 89,211 $ 892 $ 1,109,904 $ ( 762,319 ) $ ( 202,188 ) $ 6,618 $ 152,907

Balance, September 26, 2021 89,248 $ 892 $ 1,115,464 $ ( 758,870 ) $ ( 197,670 ) $ 6,520 $ 166,336

Balance, December 27, 2020 87,856 $ 879 $ 1,132,808 $ ( 918,096 ) $ ( 211,446 ) $ 6,812 $ 10,957

4 unchanged sentences

Common stock issued under stock plans (1) 1,392 13 9,870 — — — 9,883

Purchase of noncontrolling interests — — 9 — — ( 12 ) ( 3 )

Distributions to noncontrolling interests — — — — — ( 6,203 ) ( 6,203 )

Contributions from noncontrolling interests — — — — — 1,044 1,044

Balance, June 27, 2021 89,211 $ 892 $ 1,109,904 $ ( 762,319 ) $ ( 202,188 ) $ 6,618 $ 152,907

Balance, September 26, 2021 89,248 $ 892 $ 1,115,464 $ ( 758,870 ) $ ( 197,670 ) $ 6,520 $ 166,336

(CONTINUED...)

BLOOMIN’ BRANDS, INC.

6 unchanged sentences

SHARES AMOUNT

Balance, March 29, 2020 87,417 $ 874 $ 1,074,081 $ ( 793,992 ) $ ( 189,013 ) $ 8,193 $ 100,143

Balance, June 28, 2020 87,534 $ 875 $ 1,123,613 $ ( 886,248 ) $ ( 217,130 ) $ 8,088 $ 29,198

Net loss — — — ( 17,637 ) — ( 141 ) ( 17,778 )

4 unchanged sentences

Contributions from noncontrolling interests — — — — — 219 219

Equity component value of convertible note issuance, net of tax of $ 650

— — 64,367 — — — 64,367

Sale of common stock warrant — — 46,690 — — — 46,690

Purchase of convertible note hedge — — ( 66,240 ) — — — ( 66,240 )

Balance, June 28, 2020 87,534 $ 875 $ 1,123,613 $ ( 886,248 ) $ ( 217,130 ) $ 8,088 $ 29,198

Balance, September 27, 2020 87,573 $ 875 $ 1,126,146 $ ( 903,885 ) $ ( 218,002 ) $ 7,421 $ 12,555

Balance, December 29, 2019 86,946 $ 869 $ 1,094,338 $ ( 755,089 ) $ ( 169,776 ) $ 7,139 $ 177,481

Cumulative-effect from a change in accounting principle, net of tax — — — ( 4,292 ) — — ( 4,292 )

Net (loss) income — — — ( 126,867 ) — 25 ( 126,842 )

Net loss — — — ( 144,504 ) — ( 116 ) ( 144,620 )

Other comprehensive loss, net of tax — — — — ( 48,743 ) ( 147 ) ( 48,890 )

11 unchanged sentences

Purchase of convertible note hedge — — ( 66,240 ) — — — ( 66,240 )

Balance, June 28, 2020 87,534 $ 875 $ 1,123,613 $ ( 886,248 ) $ ( 217,130 ) $ 8,088 $ 29,198

Balance, September 27, 2020 87,573 $ 875 $ 1,126,146 $ ( 903,885 ) $ ( 218,002 ) $ 7,421 $ 12,555

________________

4 unchanged sentences

(DOLLARS IN THOUSANDS, UNAUDITED)

TWENTY-SIX WEEKS ENDED

JUNE 27, 2021 JUNE 28, 2020

Cash flows provided by (used in) operating activities:

THIRTY-NINE WEEKS ENDED

SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Cash flows provided by operating activities:

Net income (loss) $ 159,735 $ ( 144,620 )

Adjustments to reconcile Net income (loss) to cash provided by (used in) operating activities:

Adjustments to reconcile Net income (loss) to cash provided by operating activities:

Depreciation and amortization 122,592 137,469

11 unchanged sentences

Change in assets and liabilities ( 96,594 ) ( 25,517 )

Net cash provided by (used in) operating activities 283,182 ( 3,313 )

Net cash provided by operating activities 304,246 54,971

Cash flows used in investing activities:

7 unchanged sentences

(DOLLARS IN THOUSANDS, UNAUDITED)

TWENTY-SIX WEEKS ENDED

JUNE 27, 2021 JUNE 28, 2020

THIRTY-NINE WEEKS ENDED

SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Cash flows (used in) provided by financing activities:

1 unchanged sentence

Repayments of long-term debt and finance lease obligations ( 428,364 ) ( 19,798 )

Proceeds from borrowings on revolving credit facilities, net 286,000 505,000

Proceeds from borrowings on revolving credit facilities 378,000 505,000

Repayments of borrowings on revolving credit facilities ( 701,000 ) ( 549,000 )

23 unchanged sentences

Leased assets obtained in exchange for new finance lease liabilities $ 1,229 $ 1,263

Decrease in liabilities from the acquisition of property, fixtures and equipment $ ( 203 ) $ ( 9,666 )

Increase (decrease) in liabilities from the acquisition of property, fixtures and equipment $ 3,006 $ ( 7,174 )

The accompanying notes are an integral part of these consolidated financial statements.

30 unchanged sentences

In February 2021, the Company made an irrevocable election under the indenture to require the principal portion of its 2025 Notes to be settled in cash and any excess in shares.

Following the irrevocable notice, only the amounts expected to be settled in excess of the principal will be considered in diluted earnings per share under the if-converted method.

Following the irrevocable notice, only the amounts expected to be settled in excess of the principal are considered in diluted earnings per share under the if-converted method.

Recently Issued Financial Accounting Standards Not Yet Adopted - Recent accounting guidance not discussed herein is not applicable, did not have, or is not expected to have a material impact to the Company.

7 unchanged sentences

to comply with state and local regulations in response to the COVID-19 pandemic (“COVID-19”).

Following is a summary of charges recorded in connection with the COVID-19 pandemic for the periods indicated (dollars in thousands):

CHARGES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) CLASSIFICATION THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

JUNE 28, 2020 JUNE 28, 2020

Following is a summary of charges recorded in connection with the COVID-19 pandemic for the period indicated (dollars in thousands):

CHARGES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) CLASSIFICATION THIRTY-NINE WEEKS ENDED

SEPTEMBER 27, 2020

Inventory obsolescence and spoilage Food and beverage costs $ 6,748

8 unchanged sentences

________________

(1) Includes the write-off of value-added tax credits during the twenty-six weeks ended June 28, 2020 related to the purchase of inventory by the Company’s Brazil subsidiary.

(2) Represents relief pay for hourly employees impacted by the closure of dining rooms, net of $ 13.7 million of employee retention tax credits earned during the thirteen and twenty-six weeks ended June 28, 2020.

(1) Represents relief pay for hourly employees impacted by the closure of dining rooms, net of $ 14.4 million of employee retention tax credits earned.

(2) Represents additional contingent liabilities recorded for lease guarantees related to certain former restaurant locations now operated by franchisees or other third parties.

1 unchanged sentence

(4) Includes impairments resulting from the remeasurement of assets utilizing projected future cash flows revised for then current economic conditions, restructuring charges and the closure of certain restaurants.

(6) Includes impairment of goodwill for the Company’s Hong Kong subsidiary during the twenty-six weeks ended June 28, 2020.

(5) Includes impairment of goodwill for the Company’s Hong Kong subsidiary.

Revenue Recognition

The following table includes the categories of revenue included in the Company’s Consolidated Statements of Operations and Comprehensive Income (Loss) for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Restaurant sales $ 996,718 $ 766,487 $ 3,031,396 $ 2,338,985

Franchise and other revenues

Franchise revenue 12,221 1,951 19,010 11,500

Franchise revenues 12,908 4,216 31,918 15,716

Other revenues (1) 837 557 11,988 3,355

2 unchanged sentences

________________

(1) During the thirteen and twenty-six weeks ended June 27, 2021, the Company recognized $ 6.3 million of other revenues in connection with favorable court rulings in Brazil regarding the calculation methodology and taxable base of Program of Social Integration (“PIS”) and Contribution for the Financing of Social Security (“COFINS”) taxes.

The amount recognized as a result of the favorable court rulings primarily represents refundable PIS and COFINS taxes for prior years, including accrued interest, and will be recovered by offsetting future PIS and COFINS taxes due.

(1) The thirteen and thirty-nine weeks ended September 26, 2021 include an adjustment of $( 3.2 ) million to reduce the Company’s initial recorded estimate and net $ 3.1 million benefit from the recognition of recoverable Program of Social Integration (“PIS”) and Contribution for the Financing of Social Security (“COFINS”) taxes, respectively, within other revenues in connection with favorable court rulings in Brazil regarding the calculation methodology and taxable base.

The net amount recognized as a result of the favorable court rulings primarily represents refundable PIS and COFINS taxes for prior years, including accrued interest, and will be recovered by offsetting future PIS and COFINS taxes due.

BLOOMIN’ BRANDS, INC.

1 unchanged sentence

(UNAUDITED) - Continued

The following tables include disaggregation of Restaurant sales and franchise revenue, by restaurant concept and major international market, for the periods indicated:

The following tables include disaggregation of Restaurant sales and franchise revenues, by restaurant concept and major international market, for the periods indicated:

THIRTEEN WEEKS ENDED

JUNE 27, 2021 JUNE 28, 2020

(dollars in thousands) RESTAURANT SALES FRANCHISE REVENUE RESTAURANT SALES FRANCHISE REVENUE

SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

(dollars in thousands) RESTAURANT SALES FRANCHISE REVENUES RESTAURANT SALES FRANCHISE REVENUES

Outback Steakhouse $ 523,142 $ 9,335 $ 443,286 $ 1,422

9 unchanged sentences

Total $ 996,718 $ 12,908 $ 766,487 $ 4,216

TWENTY-SIX WEEKS ENDED

JUNE 27, 2021 JUNE 28, 2020

(dollars in thousands) RESTAURANT SALES FRANCHISE REVENUE RESTAURANT SALES FRANCHISE REVENUE

THIRTY-NINE WEEKS ENDED

SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

(dollars in thousands) RESTAURANT SALES FRANCHISE REVENUES RESTAURANT SALES FRANCHISE REVENUES

Outback Steakhouse $ 1,649,433 $ 20,709 $ 1,320,524 $ 8,099

15 unchanged sentences

The following table includes a detail of assets and liabilities from contracts with customers included on the Company’s Consolidated Balance Sheets as of the periods indicated:

(dollars in thousands) JUNE 27, 2021 DECEMBER 27, 2020

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020

Other current assets, net

8 unchanged sentences

The following table is a rollforward of deferred gift card sales commissions for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Balance, beginning of period $ 12,548 $ 13,624 $ 19,300 $ 18,554

4 unchanged sentences

The following table is a rollforward of unearned gift card revenue for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Balance, beginning of period $ 293,955 $ 279,973 $ 373,048 $ 358,757

8 unchanged sentences

The components of Provision for impaired assets and restaurant closings are as follows for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Impairment losses

3 unchanged sentences

Total impairment losses 1,162 364 8,726 64,706

Restaurant closure charges

Restaurant closure charges (benefits)

(1) 423 ( 418 ) 389 1,344

International (1) — — ( 153 ) 173

Total restaurant closure charges ( 245 ) 1,041 ( 187 ) 1,935

Total restaurant closure charges (benefits) 423 ( 418 ) 236 1,517

Provision for impaired assets and restaurant closings $ 1,585 $ ( 54 ) $ 8,962 $ 66,223

________________

and international impairment and closure charges for the thirteen and twenty-six weeks ended June 28, 2020 primarily relate to the COVID-19 pandemic, including charges related to the COVID-19 Restructuring discussed below.

and international impairment and closure charges for the thirteen and thirty-nine weeks ended September 27, 2020 primarily relate to the COVID-19 pandemic, including charges related to the COVID-19 Restructuring discussed below.

See Note 2 - COVID-19 Charges for details regarding the impact of the COVID-19 pandemic on the Company’s financial results.

(2) Includes goodwill impairment charges of $ 2.0 million during the twenty-six weeks ended June 28, 2020.

(3) Corporate impairment charges for the twenty-six weeks ended June 28, 2020 primarily relate to transformational initiatives.

COVID-19 Restructuring - During the thirteen and twenty-six weeks ended June 28, 2020, the Company recognized pre-tax asset impairments and closure charges in connection with the closure of 22 restaurants and from the update of certain cash flow assumptions, including lease renewal considerations (the “COVID-19 Restructuring”).

Following is a summary of the COVID-19 Restructuring charges recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss) for the periods indicated (dollars in thousands):

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) CLASSIFICATION THIRTEEN AND TWENTY-SIX WEEKS ENDED

DESCRIPTION JUNE 28, 2020

(2) Includes goodwill impairment charges of $ 2.0 million during the thirty-nine weeks ended September 27, 2020.

(3) Corporate impairment charges for the thirty-nine weeks ended September 27, 2020 primarily relate to transformational initiatives.

COVID-19 Restructuring - During the thirty-nine weeks ended September 27, 2020, the Company recognized pre-tax asset impairments and closure charges in connection with the closure of 22 restaurants and from the update of certain cash flow assumptions, including lease renewal considerations (the “COVID-19 Restructuring”).

Following is a summary of the COVID-19 Restructuring charges recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss) for the period indicated (dollars in thousands):

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) CLASSIFICATION THIRTY-NINE WEEKS ENDED

DESCRIPTION SEPTEMBER 27, 2020

Property, fixtures and equipment impairments Provision for impaired assets and restaurant closings $ 16,932

1 unchanged sentence

Severance and other expenses General and administrative 1,021

The remaining impairment and closure charges during the periods presented resulted primarily from locations identified for relocation or closure.

The remaining impairment and closure charges during the periods presented resulted primarily from locations identified for closure.

Annual Goodwill and Intangible Asset Impairment Assessment - The Company performs its annual assessment for impairment of goodwill and other indefinite-lived intangible assets during its second fiscal quarter.

4 unchanged sentences

(UNAUDITED) - Continued

Accrued Facility Closure and Other Costs Rollforward - The following table is a rollforward of the Company’s closed facility lease liabilities and other accrued costs associated with the closure and restructuring initiatives, for the period indicated:

TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021

Accrued Facility Closure and Other Costs Rollforward - The following table is a rollforward of the Company’s closed facility lease liabilities and other accrued costs associated with closure and restructuring initiatives, for the period indicated:

THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021

Balance, beginning of the period $ 12,879

4 unchanged sentences

________________

(1) As of June 27, 2021, the Company had exit-related accruals related to certain closure and restructuring initiatives of $ 3.6 million recorded in Accrued and other current liabilities and $ 6.7 million recorded in Non-current operating lease liabilities on its Consolidated Balance Sheet.

(1) As of September 26, 2021, the Company had exit-related accruals associated with closure and restructuring initiatives of $ 3.1 million recorded in Accrued and other current liabilities and $ 6.1 million recorded in Non-current operating lease liabilities on its Consolidated Balance Sheet.

Earnings (Loss) Per Share

The dilutive effect of the 2025 Notes is calculated using the if-converted method which was required upon the Company’s adoption of ASU No.

To the extent the Company has the ability to settle its 2025 Notes in shares of its common stock, the principal and conversion spread on the 2025 Notes will have a dilutive impact on diluted earnings per share when the average market price of the Company’s common stock for a given period exceeds the conversion price of $ 11.89 per share of common stock.

To the extent the Company has ability to settle its 2025 Notes in shares of its common stock, the principal and conversion spread on the 2025 Notes will have a dilutive impact on diluted earnings per share when the average market price of the Company’s common stock for a given period exceeds the conversion price of $ 11.89 per share of common stock.

In February 2021, the Company provided the trustee of its 2025 Notes notice of the Company’s irrevocable election to settle the principal portion of the 2025 Notes in cash and any excess in shares.

1 unchanged sentence

In connection with the offering of the 2025 Notes, the Company entered into the Convertible Note Hedge Transactions and Warrant Transactions described in Note 11 - Convertible Senior Notes.

However, the Convertible Note Hedge Transactions are not considered when calculating dilutive shares given their impact is anti-dilutive.

The impact of the Convertible Note Hedge Transactions would offset the dilutive impact of the shares underlying the 2025 Notes.

The Warrant Transactions have a dilutive effect on the Company’s common stock to the extent that the price of its common stock exceeds the $ 16.64 strike price of the Warrant Transactions.

However, the Convertible Note Hedge Transactions are not considered when calculating dilutive shares given their anti-dilutive impact as an offset to dilution of shares underlying the 2025 Notes.

The Warrant Transactions have a dilutive effect on the Company’s common stock to the extent the price of its common stock exceeds the $ 16.64 strike price of the Warrant Transactions.

See Note 11 - Convertible Senior Notes for additional information regarding the 2025 Notes, Convertible Note Hedge Transactions and Warrant Transactions .

3 unchanged sentences

The following table presents the computation of basic and diluted earnings (loss) per share attributable to common stockholders for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(in thousands, except per share data) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(in thousands, except per share data) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Net income (loss) attributable to Bloomin’ Brands

15 unchanged sentences

________________

(1) Consideration paid in excess of carrying value for the redemption of preferred stock is considered a deemed dividend and, for purposes of calculating earnings per share, reduces net income attributable to common stockholders for the twenty-six weeks ended June 28, 2020.

(1) Consideration paid in excess of carrying value for the redemption of its Abbraccio preferred stock is considered a deemed dividend and, for purposes of calculating earnings per share, reduces net income attributable to common stockholders for the thirty-nine weeks ended September 27, 2020.

See Note 13 - Stockholders’ Equity for additional details.

1 unchanged sentence

Effective with the Company’s election, there will be no further numerator adjustments for interest or denominator adjustments for shares required to settle the principal portion.

(3) Due to the Company’s net loss during the thirteen and twenty-six weeks ended June 28, 2020, dilutive excess shares, if applicable, and warrants were excluded from the computation of diluted earnings per share as their effect would be antidilutive.

(3) Due to the Company’s net loss during the thirteen and thirty-nine weeks ended September 27, 2020, dilutive excess shares, if applicable, and warrants were excluded from the computation of diluted earnings per share as their effect would be antidilutive.

Share-based compensation-related weighted-average securities outstanding not included in the computation of net earnings (loss) per share attributable to common stockholders because their effect was antidilutive were as follows, for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(shares in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(shares in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Stock options — 5,381 455 5,133

6 unchanged sentences

The Company recognized stock-based compensation expense as follows for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Stock options $ 495 $ 992 $ 1,829 $ 2,862

3 unchanged sentences

________________

(1) The thirteen and twenty-six weeks ended June 27, 2021 includes a cumulative life-to-date adjustment for PSUs granted in fiscal years 2019, 2020 and 2021 based on revised Company performance projections of performance criteria set forth in the award agreements.

(1) The thirty-nine weeks ended September 26, 2021 includes a cumulative life-to-date adjustment for PSUs granted in fiscal years 2019, 2020 and 2021 based on revised Company performance projections of performance criteria set forth in the award agreements.

In February 2021, the Company granted 0.3 million performance-based share units (“PSUs”).

These PSUs maintain a three-year cliff vesting period and the underlying adjusted diluted earnings per share performance metric can range from zero to 200 % of the annual target grant.

The grants additionally included a Relative Total Shareholder Return (“Relative TSR”) modifier to the final payout outcome, which can adjust the payout by 75 %, 100 % or 125 % of the achieved performance metric, with the overall payout capped at 200 % of the annual target grant.

The grants additionally include a Relative Total Shareholder Return (“Relative TSR”) modifier to the final payout outcome, which can adjust the payout by 75 %, 100 % or 125 % of the achieved performance metric, with the overall payout capped at 200 % of the annual target grant.

The Relative TSR is measured by comparing the Company’s Relative TSR to that of the constituents of the S&P 1500 Restaurants index.

2 unchanged sentences

Assumptions used in the Monte Carlo simulation model and the grant date fair value of PSUs granted were as follows for the period indicated:

TWENTY-SIX WEEKS ENDED

JUNE 27, 2021

THIRTY-NINE WEEKS ENDED

SEPTEMBER 26, 2021

Risk-free interest rate (1) 0.20 %

6 unchanged sentences

(3) Represents a 14.3 % premium above the per share value of the Company’s common stock as of the grant date.

The following represents unrecognized stock-based compensation expense and the remaining weighted-average vesting period as of June 27, 2021:

The following represents unrecognized stock-based compensation expense and the remaining weighted-average vesting period as of September 26, 2021:

UNRECOGNIZED COMPENSATION EXPENSE

8 unchanged sentences

Other current assets, net, consisted of the following as of the periods indicated:

(dollars in thousands) JUNE 27, 2021 DECEMBER 27, 2020

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020

Prepaid expenses $ 22,944 $ 12,148

9 unchanged sentences

(1) See Note 17 - Allowance for Expected Credit Losses for a rollforward of the related allowance for expected credit losses.

Other Assets, Net

Other assets, net, consisted of the following as of the periods indicated:

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020

Company-owned life insurance (1) $ 33,799 $ 44,814

Deferred debt issuance costs (2) 6,200 4,694

Liquor licenses 23,296 24,250

Other assets 18,824 18,868

$ 82,119 $ 92,626

________________

(1) During the thirty-nine weeks ended September 26, 2021, the Company withdrew $ 9.1 million from its Company-owned life insurance policies to pay deferred compensation obligations.

(2) Net of accumulated amortization of $ 8.2 million and $ 9.0 million as of September 26, 2021 and December 27, 2020, respectively.

Accrued and Other Current Liabilities

Accrued and other current liabilities consisted of the following as of the periods indicated:

(dollars in thousands) JUNE 27, 2021 DECEMBER 27, 2020

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020

Accrued rent and current operating lease liabilities $ 184,240 $ 192,369

4 unchanged sentences

________________

(1) During the twenty-six weeks ended June 27, 2021, the Company reclassified $ 27.3 million of payroll taxes deferred under the Coronavirus, Aid, Relief and Economic Security Act (“CARES Act”) to current.

(2) During the twenty-six weeks ended June 27, 2021, sales tax payable and income tax payable increased by $ 8.7 million and $ 6.4 million, respectively, due to increased sales and pre-tax income during the period.

(1) During the thirty-nine weeks ended September 26, 2021, the Company reclassified $ 27.3 million of payroll taxes deferred under the Coronavirus, Aid, Relief and Economic Security Act (“CARES Act”) to current.

(2) During the thirty-nine weeks ended September 26, 2021, other current liabilities increased primarily due to an $ 8.7 million increase in accrued interest related to the 2029 Notes.

See Note 10 - Long-term Debt, Net for details regarding the 2029 Notes.

BLOOMIN’ BRANDS, INC.

3 unchanged sentences

Following is a summary of outstanding long-term debt, as of the periods indicated:

JUNE 27, 2021 DECEMBER 27, 2020

SEPTEMBER 26, 2021 DECEMBER 27, 2020

(dollars in thousands) OUTSTANDING BALANCE INTEREST RATE OUTSTANDING BALANCE INTEREST RATE

19 unchanged sentences

(3) In connection with the adoption of ASU No.

2020-06, debt discount of $ 59.9 million related to the 2025 Notes was de-recognized and $ 2.1 million of equity issuance costs were reclassified as debt issuance costs during the twenty-six weeks ended June 27, 2021.

2029 Notes - On April 16, 2021, the Company and its wholly-owned subsidiary OSI Restaurant Partners, LLC (“OSI”), as co-issuers, issued $ 300.0 million aggregate principal amount of senior unsecured notes due 2029 (the “2029 Notes”).

1 unchanged sentence

The 2029 Notes are guaranteed by each of the Company’s existing and future domestic restricted subsidiaries (other than OSI) that are guarantors or borrowers under its Senior Secured Credit Facility (as defined below) or certain other indebtedness.

The 2029 Notes will mature on April 15, 2029 , unless earlier redeemed or purchased by the Company.

The 2029 Notes mature on April 15, 2029 , unless earlier redeemed or purchased by the Company.

The 2029 Notes bear cash interest at an annual rate of 5.125 % payable semi-annually in arrears on April 15 and October 15 of each year, beginning on October 15, 2021.

3 unchanged sentences

The Indenture contains restrictive covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, incur additional indebtedness or issue certain preferred stock;

pay dividends, redeem stock or make other distributions;

make certain investments;

create restrictions on the ability of the Company’s restricted

pay dividends, redeem stock or

BLOOMIN’ BRANDS, INC.

1 unchanged sentence

(UNAUDITED) - Continued

subsidiaries to pay dividends or make other payments to the Company;

make other distributions;

make certain investments;

create restrictions on the ability of the Company’s restricted subsidiaries to pay dividends or make other payments to the Company;

create certain liens;

19 unchanged sentences

150 to 250 basis points over the Eurocurrency Rate

Fees on letters of credit and daily unused availability under the revolving credit facility will be 150 to 250 basis points and 25 to 40 basis points, respectively.

Fees on letters of credit and daily unused availability under the revolving credit facility are 150 to 250 basis points and 25 to 40 basis points, respectively.

The following is a summary of required quarterly amortization payments for the Term loan A (dollars in thousands):

SCHEDULED QUARTERLY PAYMENT DATES TERM LOAN A

September 26, 2021 through June 30, 2024 $ 2,500

December 26, 2021 through June 30, 2024 $ 2,500

September 29, 2024 through June 29, 2025 $ 3,750

7 unchanged sentences

Total Net Leverage Ratio (“TNLR”) is the ratio of Consolidated Total Debt (Current portion of long-term debt and Long-term debt, net of cash, excluding the 2025 Notes) to Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization and certain other adjustments as defined in the Second Amended and Restated Credit Agreement).

The Second Amended and Restated Credit Agreement requires a TNLR not to exceed the following thresholds for the periods indicated:

QUARTERLY PERIOD ENDED MAXIMUM RATIO

June 27, 2021 (1) 5.00 to 1.00

September 26, 2021 (2) and thereafter 4.50 to 1.00

________________

(1) Seasonally annualized Consolidated EBITDA calculated as Consolidated EBITDA for the two consecutive quarters ending June 27, 2021 divided by 58.5 %.

(2) Seasonally annualized Consolidated EBITDA calculated as Consolidated EBITDA for the three consecutive quarters ending September 26, 2021 divided by 77.0 %.

The Second Amended and Restated Credit Agreement requires a TNLR not to exceed 4.50 to 1.00.

Seasonally annualized Consolidated EBITDA for the quarterly period ended September 26, 2021 was calculated as Consolidated EBITDA for the three consecutive quarters ending September 26, 2021 divided by 77.0 %.

The Second Amended and Restated Credit Agreement limits, subject to certain exceptions, the Company’s ability and the ability of its subsidiaries to:

7 unchanged sentences

The Company is also limited to $ 200.0 million of aggregate capital expenditures during the year ended December 26, 2021.

The Second Amended and Restated Credit Agreement also prohibits the Company from paying certain dividends and making certain restricted payments and acquisitions until the Company is in compliance with its TNLR covenant for the period ended September 26, 2021.

As of June 27, 2021 and December 27, 2020, the Company was in compliance with its debt covenants.

The Second Amended and Restated Credit Agreement also prohibited the Company from paying certain dividends and making certain restricted payments and acquisitions until the Company was in compliance with its TNLR covenant for the period ended September 26, 2021.

As of September 26, 2021 and December 27, 2020, the Company was in compliance with its debt covenants.

Following is a summary of principal payments of the Company’s total consolidated debt outstanding as of the period indicated:

(dollars in thousands) JUNE 27, 2021

(dollars in thousands) SEPTEMBER 26, 2021

Year 1 $ 11,110

8 unchanged sentences

Total principal payments $ 839,151

Deferred Financing Fees - During the thirteen weeks ended June 27, 2021, t he Company deferred $ 5.5 million and $ 5.9 million of financing costs incurred in connection with the 2029 Notes and Second Amended Credit Agreement, respectively.

Deferred Financing Fees - During the thirty-nine weeks ended September 26, 2021, the Company deferred $ 5.5 million and $ 5.9 million of financing costs incurred in connection with the 2029 Notes and Second Amended Credit Agreement, respectively.

Deferred financing fees of $ 3.7 million associated with the revolving credit facility portion of the Second Amended Credit Agreement were recorded in Other assets, net and all other deferred financing fees were recorded in Long-term debt, net.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

Convertible Senior Notes

1 unchanged sentence

The 2025 Notes are governed by the terms of an indenture between the Company and Wells Fargo Bank, National Association, as the Trustee.

The 2025 Notes will mature on May 1, 2025 , unless earlier converted, redeemed or purchased by the Company.

The 2025 Notes mature on May 1, 2025 , unless earlier converted, redeemed or purchased by the Company.

The 2025 Notes bear cash interest at an annual rate of 5.00 %, payable semi-annually in arrears on May 1 and November 1 of each year.

Net proceeds from the 2025 Notes offering were approximately $ 221.6 million, after deducting the initial purchaser’s discounts and commissions and the Company’s offering expenses.

Net proceeds from the

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

2025 Notes offering were approximately $ 221.6 million, after deducting the initial purchaser’s discounts and commissions and the Company’s offering expenses.

The initial conversion rate applicable to the 2025 Notes is 84.122 shares of common stock per $ 1,000 principal amount of 2025 Notes, or a total of approximately 19.348 million shares for the total $ 230.0 million principal amount.

6 unchanged sentences

(iv) if the Company calls the 2025 Notes for redemption, and (v) at any time from, and including November 1, 2024 until the close of business on the second scheduled trading day immediately before the maturity date.

The 2025 Notes will be redeemable by the Company, in whole or in part, at the Company’s option at any time, and from time to time, on or after May 1, 2023 and on or before the 40 th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the 2025 Notes to be redeemed, plus accrued and unpaid interest, but only if the last reported sale price per share of the Company’s common stock exceeds 130 % of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice;

(i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice;

and (ii) the trading day immediately before the date the Company sends such notice.

6 unchanged sentences

The following table includes the outstanding principal amount and carrying value of the 2025 Notes as of the periods indicated:

(dollars in thousands) JUNE 27, 2021 DECEMBER 27, 2020

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020

Long-term debt, net

6 unchanged sentences

(1) In connection with the adoption of ASU No.

2020-06, debt discount and the equity component of the 2025 Notes were de-recognized and $ 2.1 million of issuance costs that were previously allocated to the equity component were reclassified as debt issuance costs during the twenty-six weeks ended June 27, 2021.

(2) Debt issuance costs are amortized to Interest expense, net using the effective interest method over the expected life of the 2025 Notes.

The effective rate of the 2025 Notes over their expected life is 5.85 %.

(2) Debt issuance costs are amortized to Interest expense, net using the effective interest method over the 2025 Notes’ expected life.

Following is a summary of interest expense for the 2025 Notes, by component, for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 27, 2021

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Coupon interest $ 2,875 $ 2,875 $ 8,625 $ 4,568

Deferred discount amortization — 2,407 — 3,786

Deferred issuance cost amortization 392 215 1,159 343

Total interest expense (1) $ 3,267 $ 5,497 $ 9,784 $ 8,697

Based on the daily closing prices of the Company’s stock during the quarter ended June 27, 2021, holders of the 2025 Notes are eligible to convert their 2025 Notes during the third quarter of 2021.

________________

(1) The effective rate of the 2025 Notes over their expected life was 5.85 % for the thirteen and thirty-nine weeks ended September 26, 2021 and 13.73 % for the thirteen and thirty-nine weeks ended September 27, 2020.

Based on the daily closing prices of the Company’s stock during the quarter ended September 26, 2021, holders of the 2025 Notes are eligible to convert their 2025 Notes during the fourth quarter of 2021.

In February 2021, the Company provided the trustee of the 2025 Notes notice of its irrevocable election under the 2025 Notes indenture to settle the principal portion of the 2025 Notes upon conversion in cash and any excess in shares.

12 unchanged sentences

Other long-term liabilities, net, consisted of the following as of the periods indicated:

(dollars in thousands) JUNE 27, 2021 DECEMBER 27, 2020

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020

Accrued insurance liability $ 31,422 $ 32,128

4 unchanged sentences

_______________

(1) During the twenty-six weeks ended June 27, 2021, the Company reclassified $ 27.3 million of payroll taxes deferred under the CARES Act to current.

(2) The Company’s hedge liability decreased by $ 11.8 million during the twenty-six weeks ended June 27, 2021 primarily from the termination of certain interest rate swaps.

(1) During the thirty-nine weeks ended September 26, 2021, the Company reclassified $ 27.3 million of payroll taxes deferred under the CARES Act to current.

(2) The Company’s hedge liability decreased by $ 13.7 million during the thirty-nine weeks ended September 26, 2021 primarily from the termination of certain interest rate swaps.

See Note 14 - Derivative Instruments and Hedging Activities for additional details.

Stockholders’ Equity

Redeemable Preferred Stock - In connection with the development of its Abbraccio Cucina Italiana (“Abbraccio”) concept in 2015, the Company sold preferred shares of its Abbraccio subsidiary (“Abbraccio Shares”) to certain investors.

Redeemable Preferred Stock - In connection with the development of its Abbraccio Cucina Italiana (“Abbraccio”) concept in 2015, the Company sold preferred shares of its Abbraccio concept (“Abbraccio Shares”) to certain investors.

During the thirteen weeks ended March 29, 2020, the Company exercised a call option to purchase all outstanding Abbraccio Shares for $ 1.0 million and recorded a reduction to Accumulated deficit and an increase in Net loss applicable to common stockholders of $ 3.5 million for the consideration paid in excess of the Abbraccio Shares’ carrying value.

Accumulated Other Comprehensive Loss (“AOCL”) - Following are the components of AOCL as of the periods indicated:

(dollars in thousands) JUNE 27, 2021 DECEMBER 27, 2020

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020

Foreign currency translation adjustment $ ( 183,770 ) $ ( 188,883 )

2 unchanged sentences

Following are the components of Other comprehensive income (loss) attributable to Bloomin’ Brands for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Foreign currency translation adjustment $ 1,673 $ ( 4,095 ) $ 5,113 $ ( 40,538 )

Unrealized loss on derivatives, net of tax (1) ( 128 ) ( 1,556 ) ( 170 ) ( 14,892 )

Unrealized (loss) gain on derivatives, net of tax (1) ( 153 ) 261 ( 323 ) ( 14,631 )

Reclassification of adjustments for loss on derivatives included in Net income (loss), net of tax (2) 1,519 2,962 6,036 6,943

3 unchanged sentences

________________

(1) Unrealized loss on derivatives is net of tax of $ 0.5 million and $ 5.2 million for the thirteen and twenty-six weeks ended June 28, 2020, respectively.

(1) Unrealized loss on derivatives is net of tax of $ 5.1 million for the thirty-nine weeks ended September 27, 2020.

(2) Reclassifications of adjustments for loss on derivatives are net of tax.

5 unchanged sentences

Cash Flow Hedges of Interest Rate Risk - In October 2018, the Company entered into variable-to-fixed interest rate swap agreements with 12 counterparties to hedge a portion of the cash flows of the Company’s variable rate debt.

The swap agreements have an aggregate notional amount of $ 550.0 million and mature on November 30, 2022 .

The swap agreements had an aggregate notional amount of $ 550.0 million and mature on November 30, 2022 .

Under the terms of the swap agreements, the Company pays a weighted-average fixed rate of 3.04 % on the notional amount and receives payments from the counterparty based on the one-month LIBOR rate.

2 unchanged sentences

The Company’s swap agreements have been designated and qualify as cash flow hedges, are recognized on its Consolidated Balance Sheets at fair value and are classified based on the instruments’ maturity dates.

As of June 27, 2021, the Company estimated $ 16.0 million will be reclassified to Interest expense, net over the next 12 fiscal months, including interest expense related to the terminated swap agreements discussed above.

As of September 26, 2021, the Company estimated $ 16.1 million will be reclassified to Interest expense, net over the next 12 fiscal months, including interest expense related to the terminated swap agreements discussed above.

The following table presents the fair value and classification of the Company’s swap agreements, as of the periods indicated:

(dollars in thousands) JUNE 27, 2021 DECEMBER 27, 2020 CONSOLIDATED BALANCE SHEET CLASSIFICATION

(dollars in thousands) SEPTEMBER 26, 2021 DECEMBER 27, 2020 CONSOLIDATED BALANCE SHEET CLASSIFICATION

Interest rate swaps - liability $ 7,502 $ 14,855 Accrued and other current liabilities

5 unchanged sentences

The following table summarizes the effects of the swap agreements on Net income (loss) for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Interest rate swap expense recognized in Interest expense, net $ ( 2,045 ) $ ( 3,991 ) $ ( 8,127 ) $ ( 9,353 )

Income tax benefit recognized in Provision (benefit) for income taxes 524 897 1,565 1,381

Income tax benefit recognized in (Benefit) provision for income taxes 526 1,029 2,091 2,410

Total effects on Net income (loss) $ ( 1,519 ) $ ( 2,962 ) $ ( 6,036 ) $ ( 6,943 )

2 unchanged sentences

The Company continually assesses the creditworthiness of its counterparties.

As of June 27, 2021, all counterparties to the interest rate swaps had performed in accordance with their contractual obligations.

As of September 26, 2021, all counterparties to the interest rate swaps had performed in accordance with their contractual obligations.

The Company has agreements with each of its derivative counterparties that contain a provision where the Company could be declared in default on its derivative obligations if the repayment of the underlying indebtedness is accelerated by the lender due to the Company’s default on indebtedness.

2 unchanged sentences

(UNAUDITED) - Continued

As of June 27, 2021 and December 27, 2020, the fair value of the Company’s interest rate swaps was in a net liability position, including accrued interest but excluding any adjustment for nonperformance risk, of $ 12.0 million and $ 32.2 million, respectively.

As of June 27, 2021 and December 27, 2020, the Company has not posted any collateral related to these agreements.

If the Company had breached any of these provisions as of June 27, 2021 and December 27, 2020, it could have been required to settle its obligations under the agreements at their termination value of $ 12.0 million and $ 32.2 million, respectively.

As of September 26, 2021 and December 27, 2020, the fair value of the Company’s interest rate swaps was in a net liability position, including accrued interest but excluding any adjustment for nonperformance risk, of $ 10.1 million and $ 32.2 million, respectively.

As of September 26, 2021 and December 27, 2020, the Company has not posted any collateral related to these agreements.

If the Company had breached any of these provisions as of September 26, 2021 and December 27, 2020, it could have been required to settle its obligations under the agreements at their termination value of $ 10.1 million and $ 32.2 million, respectively.

The following table includes a detail of lease assets and liabilities included on the Company’s Consolidated Balance Sheets as of the periods indicated:

(dollars in thousands) CONSOLIDATED BALANCE SHEET CLASSIFICATION JUNE 27, 2021 DECEMBER 27, 2020

(dollars in thousands) CONSOLIDATED BALANCE SHEET CLASSIFICATION SEPTEMBER 26, 2021 DECEMBER 27, 2020

Operating lease right-of-use assets Operating lease right-of-use assets $ 1,152,268 $ 1,172,910

7 unchanged sentences

________________

(1) Net of accumulated amortization of $ 2.8 million and $ 2.3 million as of June 27, 2021 and December 27, 2020, respectively.

(2) Excludes COVID-19-related deferred rent accruals of $ 3.4 million and $ 12.8 million as of June 27, 2021 and December 27, 2020, respectively, and accrued contingent percentage rent of $ 3.3 million and $ 2.7 million, as of June 27, 2021 and December 27, 2020, respectively.

(3) Excludes COVID-19-related non-current deferred rent accruals of $ 0.8 million and $ 1.2 million as of June 27, 2021 and December 27, 2020, respectively.

(1) Net of accumulated amortization of $ 3.1 million and $ 2.3 million as of September 26, 2021 and December 27, 2020, respectively.

(2) Excludes COVID-19-related deferred rent accruals of $ 2.1 million and $ 12.8 million as of September 26, 2021 and December 27, 2020, respectively, and accrued contingent percentage rent of $ 3.6 million and $ 2.7 million, as of September 26, 2021 and December 27, 2020, respectively.

(3) Excludes COVID-19-related non-current deferred rent accruals of $ 0.6 million and $ 1.2 million as of September 26, 2021 and December 27, 2020, respectively.

Following is a summary of expenses and income related to leases recognized in the Company’s Consolidated Statements of Operations and Comprehensive Income (Loss) for the periods indicated:

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) CLASSIFICATION THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) CLASSIFICATION THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Operating leases (1) Other restaurant operating $ 44,807 $ 45,341 $ 133,362 $ 133,999

6 unchanged sentences

________________

(1) Excludes rent expense for office facilities and Company-owned closed or subleased properties of $ 3.2 million and $ 3.3 million for the thirteen weeks ended June 27, 2021 and June 28, 2020, respectively, and $ 6.7 million and $ 6.9 million for the twenty-six weeks ended June 27, 2021 and June 28, 2020, respectively, which is included in General and administrative expense.

Also excludes certain supply chain related rent expense of $ 0.3 million for the thirteen weeks ended June 27, 2021 and June 28, 2020 and $ 0.6 million for the twenty-six weeks ended June 27, 2021 and June 28, 2020, which is included in Food and beverage costs.

(1) Excludes rent expense for office facilities and Company-owned closed or subleased properties of $ 3.2 million and $ 3.6 million for the thirteen weeks ended September 26, 2021 and September 27, 2020, respectively, and $ 9.9 million and $ 10.4 million for the thirty-nine weeks ended September 26, 2021 and September 27, 2020, respectively, which is included in General and administrative expense.

Also excludes certain immaterial supply chain related rent expense included in Food and beverage costs.

(2) Includes COVID-19-related rent abatement for all periods presented.

(3) Excludes immaterial rental income from Company-owned properties.

BLOOMIN’ BRANDS, INC.

2 unchanged sentences

The following table is a summary of other impacts to the Company’s Consolidated Financial Statements related to its leases for the periods indicated:

TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020

THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Cash flows from operating activities:

7 unchanged sentences

Fair Value Measurements on a Recurring Basis - The following table summarizes the Company’s financial assets and liabilities measured at fair value by hierarchy level on a recurring basis as of the periods indicated:

JUNE 27, 2021 DECEMBER 27, 2020

SEPTEMBER 26, 2021 DECEMBER 27, 2020

(dollars in thousands) TOTAL LEVEL 1 LEVEL 2 TOTAL LEVEL 1 LEVEL 2

17 unchanged sentences

The Company also considers its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements.

As of June 27, 2021 and December 27, 2020, the Company has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives.

As of September 26, 2021 and December 27, 2020, the Company has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives.

BLOOMIN’ BRANDS, INC.

4 unchanged sentences

The following table summarizes the Company’s assets measured at fair value by hierarchy level on a nonrecurring basis, for the periods indicated:

THIRTEEN WEEKS ENDED

JUNE 27, 2021 JUNE 28, 2020

(dollars in thousands) REMAINING CARRYING VALUE TOTAL IMPAIRMENT REMAINING CARRYING VALUE TOTAL IMPAIRMENT

Operating lease right-of-use assets (1) $ 5,687 $ 962 $ 32,404 $ 4,028

Property, fixtures and equipment (2) 8,192 4,460 9,992 19,595

Goodwill and other assets (3) — — 748 295

$ 13,879 $ 5,422 $ 43,144 $ 23,918

TWENTY-SIX WEEKS ENDED

JUNE 27, 2021 JUNE 28, 2020

THIRTY-NINE WEEKS ENDED

SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

(dollars in thousands) REMAINING CARRYING VALUE TOTAL IMPAIRMENT REMAINING CARRYING VALUE TOTAL IMPAIRMENT

6 unchanged sentences

(1) Asset carrying values measured using discounted cash flow models (Level 3).

(2) Carrying values measured using Level 2 inputs to estimate fair value totaled $ 0.5 million and $ 2.2 million for the thirteen and twenty-six weeks ended June 28, 2020, respectively.

(2) Carrying values measured using Level 2 inputs to estimate fair value totaled $ 2.2 million for the thirty-nine weeks ended September 27, 2020.

All other assets were valued using Level 3 inputs.

1 unchanged sentence

(3) Other assets generally measured using the quoted market value of comparable assets (Level 2).

See Note 4 - Impairments and Exit Costs for information regarding impairment charges resulting from the fair value measurement performed on a nonrecurring basis during the thirteen and twenty-six weeks ended June 28, 2020.

Projected future cash flows, including discount rate and growth rate assumptions, are derived from then current economic conditions, expectations of management and projected trends of current operating results.

4 unchanged sentences

In order to calculate the present value of those future cash flows, the Company discounted cash flow estimates at its weighted-average cost of capital applicable to the country in which the measured assets reside.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

The following table presents quantitative information related to certain unobservable inputs used in the Company’s Level 3 fair value measurements of Operating lease right-of-use assets and Property, fixtures and equipment for the impairment losses incurred for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

UNOBSERVABLE INPUTS JUNE 28, 2020 JUNE 28, 2020

THIRTY-NINE WEEKS ENDED

UNOBSERVABLE INPUTS SEPTEMBER 27, 2020

Weighted-average cost of capital 10.4 % to 11.3 %

Long-term growth rate 1.5 % to 2.0 % 1.5 % to 2.0 %

Long-term growth rate 1.5 % to 2.0 %

Interim Disclosures about Fair Value of Financial Instruments - The Company’s non-derivative financial instruments consist of cash equivalents, accounts receivable, accounts payable and current and long-term debt.

The fair values of cash equivalents, accounts receivable and accounts payable approximate their carrying amounts reported on its Consolidated Balance Sheets due to their short duration.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

Debt is carried at amortized cost;

1 unchanged sentence

The following table includes the carrying value and fair value of the Company’s debt by hierarchy level as of the periods indicated:

JUNE 27, 2021 DECEMBER 27, 2020

SEPTEMBER 26, 2021 DECEMBER 27, 2020

CARRYING VALUE FAIR VALUE LEVEL 2 CARRYING VALUE FAIR VALUE LEVEL 2

10 unchanged sentences

The following table is a rollforward of the Company’s trade receivables allowance for expected credit losses for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Allowance for expected credit losses, beginning of period $ 3,989 $ 4,566 $ 4,095 $ 199

9 unchanged sentences

See Note 19 - Commitments and Contingencies for details regarding these lease guarantees.

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Income (loss) before (benefit) provision for income taxes $ 597 $ ( 32,554 ) $ 184,562 $ ( 214,830 )

(Benefit) provision for income taxes $ ( 4,454 ) $ ( 14,776 ) $ 24,827 $ ( 70,210 )

Effective income tax rate (NM) 45.4 % 13.5 % 32.7 %

________________

NM Not meaningful.

For the thirteen weeks ended September 26, 2021, the benefit for income taxes includes the impact of changes to the estimate of the forecasted full-year effective tax rate relative to prior quarters in 2021.

The benefit of FICA tax credits on certain employees’ tips reduced the effective tax rate as a result of forecasted pre-tax income.

BLOOMIN’ BRANDS, INC.

1 unchanged sentence

(UNAUDITED) - Continued

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

Income (loss) before provision (benefit) for income taxes $ 107,574 $ ( 128,207 ) $ 183,965 $ ( 182,276 )

Provision (benefit) for income taxes $ 22,688 $ ( 35,779 ) $ 29,281 $ ( 55,434 )

Effective income tax rate 21.1 % 27.9 % 15.9 % 30.4 %

The effective income tax rate for the thirteen and twenty-six weeks ended June 27, 2021 decreased by 6.8 and 14.5 percentage points, respectively, as compared to the thirteen and twenty-six weeks ended June 28, 2020.

These decreases were primarily due to the benefit of FICA tax credits on certain employees’ tips reducing the effective tax rate in 2021 as a result of forecasted pre-tax book income as compared to increasing the effective tax rate in 2020 as a result of forecasted pre-tax book loss.

As of December 27, 2020, the Company had $ 155.3 million in general business tax credits carryforwards, which have a 20-year carryforward period and are utilized on a first-in, first-out basis.

The Company does not expect to increase its general business credit carryforwards in 2021 and currently expects to utilize these tax credit carryforwards within a 10-year period.

thirteen weeks ended September 27, 2020, the benefit of FICA tax credits on certain employees’ tips increased the effective tax rate as a result of forecasted pre-tax book loss.

The effective income tax rate for the thirty-nine weeks ended September 26, 2021 decreased by 19.2 percentage points as compared to the thirty-nine weeks ended September 27, 2020.

The decrease was primarily due to the benefit of FICA tax credits on certain employees’ tips reducing the effective tax rate in 2021 as a result of forecasted pre-tax book income as compared to increasing the effective tax rate in 2020 as a result of forecasted pre-tax book loss.

As of December 27, 2020, the Company had $ 155.3 million in general business tax credit carryforwards, which have a 20-year carryforward period and are utilized on a first-in, first-out basis.

The Company expects to increase its general business credit carryforwards in 2021 by approximately $ 5 million to $ 10 million.

The Company currently expects to utilize these tax credit carryforwards within a 10-year period.

However, the Company’s ability to utilize these tax credits could be adversely impacted by, among other items, a future ownership change as defined under Section 382 of the Internal Revenue Code.

The Company has a blended federal and state statutory rate of approximately 26 %.

The effective income tax rate for the thirteen and twenty-six weeks ended June 27, 2021 was lower than the statutory rate primarily due to the benefit of FICA tax credits on certain employees’ tips.

The effective income tax rate for the thirty-nine weeks ended September 26, 2021 was lower than the statutory rate primarily due to the benefit of FICA tax credits on certain employees’ tips.

Commitments and Contingencies

5 unchanged sentences

The Company’s legal proceedings range from cases brought by a single plaintiff to threatened class actions with many putative class members.

While some matters pending against the Company specify the damages claimed by the plaintiff or class, many seek an unspecified amount of damages or are at very early stages of the legal process.

While some matters pending against the Company specify the damages claimed by the plaintiff or class, many seek unspecified amounts or are at very early stages of the legal process.

Even when the amount of damages claimed against the Company are stated, the claimed amount may be exaggerated, unsupported or unrelated to possible outcomes, and as such, are not meaningful indicators of the Company’s potential liability or financial exposure.

As a result, some matters have not yet progressed sufficiently through discovery or development of important factual information and legal issues to enable the Company to estimate an amount of loss or a range of possible loss.

The Company recorded reserves of $ 5.9 million and $ 4.6 million for certain of its outstanding legal proceedings as of June 27, 2021 and December 27, 2020, respectively, within Accrued and other current liabilities and Other long-term liabilities on its Consolidated Balance Sheets.

The Company recorded reserves of $ 6.3 million and $ 4.6 million for certain of its outstanding legal proceedings as of September 26, 2021 and December 27, 2020, respectively, within Accrued and other current liabilities and Other long-term liabilities on its Consolidated Balance Sheets.

While the Company believes that additional losses beyond these accruals are reasonably possible, it cannot estimate a possible loss contingency or range of reasonably possible loss contingencies beyond these accruals.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

The Company intends to defend itself in legal matters.

Some of these matters may be covered, at least in part, by insurance if they exceed specified retention or deductible amounts.

However, it is possible that claims may be denied by the Company’s insurance carriers, the Company may be required by its insurance carriers to contribute to the payment of claims, and the Company’s insurance coverage may not continue to be available on acceptable terms or in sufficient amounts.

However, it is possible that claims may be denied by the Company’s insurance carriers, the Company may be required by its insurance carriers to contribute to the payment of claims, or the Company’s insurance coverage may not continue to be available on acceptable terms or in sufficient amounts.

The Company records receivables from third party insurers when recovery has been determined to be probable.

The Company believes that the ultimate determination of liability in connection with legal claims pending against the Company, if any, in excess of amounts already provided for such matters in the consolidated financial statements, will not have a material adverse effect on its business, annual results of operations, liquidity or financial position.

The Company believes that the ultimate determination of liability in connection with

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

legal claims pending against the Company, if any, in excess of amounts already provided for such matters in the consolidated financial statements, will not have a material adverse effect on its business, annual results of operations, liquidity or financial position.

However, it is possible that the Company’s business, results of operations, liquidity, or financial condition could be materially affected in a particular future reporting period by the unfavorable resolution of one or more matters or contingencies during such period.

1 unchanged sentence

These leases have varying terms, the latest of which expires in 2032.

As of June 27, 2021, the undiscounted payments that the Company could be required to make in the event of non-payment by the primary lessees was approximately $ 27.9 million.

The present value of these potential payments discounted at the Company’s incremental borrowing rate as of June 27, 2021 was approximately $ 22.9 million.

As of September 26, 2021, the undiscounted payments that the Company could be required to make in the event of non-payment by the primary lessees was approximately $ 25.9 million.

The present value of these potential payments discounted at the Company’s incremental borrowing rate as of September 26, 2021 was approximately $ 21.2 million.

In the event of default, the indemnity clauses in the Company’s purchase and sale agreements govern its ability to pursue and recover damages incurred.

As of June 27, 2021, the Company’s recorded contingent lease liability was $ 10.3 million.

As of September 26, 2021, the Company’s recorded contingent lease liability was $ 8.8 million.

Royalty Termination - On August 2, 2021, wholly-owned subsidiaries of the Company entered into the Purchase and Sale of Royalty Payment Stream and Termination of Royalty Agreement (the “Royalty Termination Agreement”) with the Carrabba’s Italian Grill founders (the “Carrabba’s Founders”), pursuant to which the Company’s obligation to pay future royalties on U.S.

Carrabba’s Italian Grill restaurant sales and lump sum royalty fees on Carrabba’s Italian Grill (and Abbraccio) restaurants opened outside the U.S.

was terminated.

Upon execution of the Royalty Termination Agreement, the Company made a cash payment of $ 61.9 million to the Carrabba’s Founders, which was recorded in Other restaurant operating expense in its Consolidated Statements of Operations and Comprehensive Income (Loss) during the thirteen weeks ended September 26, 2021.

Segment Reporting

24 unchanged sentences

The following table is a summary of Total revenues by segment, for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Total revenues

2 unchanged sentences

Total revenues $ 1,010,463 $ 771,260 $ 3,075,302 $ 2,358,056

The following table is a reconciliation of Segment income (loss) from operations to Income (loss) before provision (benefit) for income taxes, for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

The following table is a reconciliation of Segment income (loss) from operations to Income (loss) before (benefit) provision for income taxes, for the periods indicated:

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Segment income (loss) from operations

7 unchanged sentences

Interest expense, net ( 14,245 ) ( 18,300 ) ( 43,863 ) ( 46,647 )

Income (loss) before provision (benefit) for income taxes $ 107,574 $ ( 128,207 ) $ 183,965 $ ( 182,276 )

Income (loss) before (benefit) provision for income taxes $ 597 $ ( 32,554 ) $ 184,562 $ ( 214,830 )

____________________

(1) The thirteen and twenty-six weeks ended June 28, 2020 include $ 2.4 million and $ 24.6 million, respectively, of charges that were not allocated to the Company’s segments related to its transformational initiatives, primarily recorded within General and administrative expense and Provision for impaired assets and restaurant closings.

(1) The thirteen and thirty-nine weeks ended September 27, 2020 include $ 4.2 million and $ 28.8 million, respectively, of charges that were not allocated to the Company’s segments related to its transformational initiatives, primarily recorded within General and administrative expense and Provision for impaired assets and restaurant closings.

The following table is a summary of Depreciation and amortization expense by segment for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020 JUNE 27, 2021 JUNE 28, 2020

THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020 SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Depreciation and amortization

4 unchanged sentences

The following table is a summary of capital expenditures by segment for the periods indicated:

TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 27, 2021 JUNE 28, 2020

THIRTY-NINE WEEKS ENDED

(dollars in thousands) SEPTEMBER 26, 2021 SEPTEMBER 27, 2020

Capital expenditures

4 unchanged sentences

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

Subsequent Events

On August 2, 2021, wholly-owned subsidiaries of the Company entered into the Purchase and Sale of Royalty Payment Stream and Termination of Royalty Agreement (the “Royalty Termination Agreement”) with the Carrabba’s Italian Grill founders (the “Carrabba’s Founders”), pursuant to which the Company’s obligation to pay future royalties on U.S.

Carrabba’s Italian Grill restaurant sales and lump sum royalty fees on Carrabba’s Italian Grill restaurants opened outside the U.S.

was terminated.

BLOOMIN’ BRANDS, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements