What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-08-01 compared with 2023-05-02 · 233 added, 146 removed, 407 unchanged (48% of the section changed)

2 unchanged sentences

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

MARCH 26, 2023 DECEMBER 25, 2022

JUNE 25, 2023 DECEMBER 25, 2022

Current assets

13 unchanged sentences

Accounts payable $ 202,207 $ 183,715

Current operating lease liabilities 185,362 183,510

Accrued and other current liabilities 211,481 217,427

Unearned revenue 312,556 394,215

Current portion of long-term debt 2,267 1,636

Total current liabilities 911,606 978,867

7 unchanged sentences

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

no shares issued and outstanding as of March 26, 2023 and December 25, 2022

no shares issued and outstanding as of June 25, 2023 and December 25, 2022

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

87,465,214 and 87,696,200 shares issued and outstanding as of March 26, 2023 and December 25, 2022, respectively

87,339,455 and 87,696,200 shares issued and outstanding as of June 25, 2023 and December 25, 2022, respectively

Additional paid-in capital 1,132,732 1,161,912

7 unchanged sentences

BLOOMIN’ BRANDS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(IN THOUSANDS, EXCEPT PER SHARE DATA, UNAUDITED)

THIRTEEN WEEKS ENDED

MARCH 26, 2023 MARCH 27, 2022

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Restaurant sales $ 1,137,330 $ 1,108,918 $ 2,365,564 $ 2,232,493

10 unchanged sentences

Income from operations 89,446 87,719 210,079 194,975

Loss on extinguishment and modification of debt — ( 107,630 ) — ( 107,630 )

Loss on fair value adjustment of derivatives, net — ( 17,685 ) — ( 17,685 )

Interest expense, net ( 12,961 ) ( 12,548 ) ( 25,405 ) ( 26,181 )

Income before provision for income taxes 108,189 93,623

Income (loss) before provision for income taxes 76,485 ( 50,144 ) 184,674 43,479

Provision for income taxes 6,483 11,536 21,244 27,465

Net income 93,428 77,694

Net income (loss) 70,002 ( 61,680 ) 163,430 16,014

net income attributable to noncontrolling interests 1,725 1,955 3,842 4,138

Net income attributable to Bloomin’ Brands

Net income (loss) attributable to Bloomin’ Brands

$ 68,277 $ ( 63,635 ) $ 159,588 $ 11,876

Net income $ 93,428 $ 77,694

Other comprehensive income:

Net income (loss) $ 70,002 $ ( 61,680 ) $ 163,430 $ 16,014

Other comprehensive income (loss):

Foreign currency translation adjustment 4,502 11,940 3,368 23,223

Unrealized gain on derivatives, net of tax — — — 573

Reclassification of adjustments for loss on derivatives included in Net income, net of tax — 681

Impact of terminated interest rate swaps included in Net income, net of tax — 3,021

Comprehensive income 92,294 93,252

Reclassification of adjustments for loss on derivatives included in Net income (loss), net of tax — 273 — 954

Impact of terminated interest rate swaps included in Net income (loss), net of tax — 2,164 — 5,185

Comprehensive income (loss) 74,504 ( 47,303 ) 166,798 45,949

comprehensive income attributable to noncontrolling interests 1,725 1,955 3,842 4,138

Comprehensive income attributable to Bloomin’ Brands $ 90,177 $ 91,069

Earnings per share:

Comprehensive income (loss) attributable to Bloomin’ Brands $ 72,779 $ ( 49,258 ) $ 162,956 $ 41,811

Earnings (loss) per share:

Basic $ 0.77 $ ( 0.72 ) $ 1.80 $ 0.13

12 unchanged sentences

SHARES AMOUNT

March 26, 2023 87,465 $ 875 $ 1,141,017 $ ( 635,451 ) $ ( 186,445 ) $ 2,845 $ 322,841

Net income — — — 68,277 — 1,725 70,002

Other comprehensive income — — — — 4,502 — 4,502

Cash dividends declared, $ 0.24 per common share

— — ( 20,990 ) — — — ( 20,990 )

Repurchase and retirement of common stock, including excise tax of $ 31

( 619 ) ( 6 ) — ( 15,564 ) — — ( 15,570 )

Stock-based compensation — — 5,138 — — — 5,138

Common stock issued under stock plans (1) 493 4 7,567 — — — 7,571

Distributions to noncontrolling interests — — — — — ( 2,085 ) ( 2,085 )

Contributions from noncontrolling interests — — — — — 459 459

June 25, 2023 87,339 $ 873 $ 1,132,732 $ ( 582,738 ) $ ( 181,943 ) $ 2,944 $ 371,868

December 25, 2022 87,696 $ 877 $ 1,161,912 $ ( 706,109 ) $ ( 185,311 ) $ 2,540 $ 273,909

Net income — — — 159,588 — 3,842 163,430

Other comprehensive loss — — — — ( 1,134 ) — ( 1,134 )

Other comprehensive income — — — — 3,368 — 3,368

Cash dividends declared, $ 0.48 per common share

— — ( 42,004 ) — — — ( 42,004 )

Repurchase and retirement of common stock, including excise tax ( 863 ) ( 9 ) — ( 20,653 ) — — ( 20,662 )

Repurchase and retirement of common stock, including excise tax of $ 48

( 1,482 ) ( 15 ) — ( 36,217 ) — — ( 36,232 )

Stock-based compensation — — 8,042 — — — 8,042

2 unchanged sentences

Contributions from noncontrolling interests — — — — — 1,202 1,202

March 26, 2023 87,465 $ 875 $ 1,141,017 $ ( 635,451 ) $ ( 186,445 ) $ 2,845 $ 322,841

June 25, 2023 87,339 $ 873 $ 1,132,732 $ ( 582,738 ) $ ( 181,943 ) $ 2,944 $ 371,868

(CONTINUED...)

BLOOMIN’ BRANDS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(IN THOUSANDS, EXCEPT PER SHARE DATA, UNAUDITED)

BLOOMIN’ BRANDS, INC.

COMMON STOCK ADDITIONAL PAID-IN CAPITAL ACCUM-

2 unchanged sentences

SHARES AMOUNT

March 27, 2022 89,185 $ 892 $ 1,115,458 $ ( 634,356 ) $ ( 190,431 ) $ 1,694 $ 293,257

Net (loss) income — — — ( 63,635 ) — 1,955 ( 61,680 )

Other comprehensive income, net of tax — — — — 14,377 — 14,377

Cash dividends declared, $ 0.14 per common share

— — ( 12,418 ) — — — ( 12,418 )

Repurchase and retirement of common stock ( 1,761 ) ( 17 ) — ( 35,732 ) — — ( 35,749 )

Stock-based compensation — — 4,959 — — — 4,959

Common stock issued under stock plans (1) 414 4 1,118 — — — 1,122

Purchase of noncontrolling interests, net of tax of $ 1,142

— — ( 3,301 ) — — 539 ( 2,762 )

Distributions to noncontrolling interests — — — — — ( 2,513 ) ( 2,513 )

Contributions from noncontrolling interests — — — — — 244 244

Retirement of convertible senior note hedges — — 112,956 — — — 112,956

Retirement of warrants — — ( 97,617 ) — — — ( 97,617 )

Issuance of common stock from repurchase of convertible senior notes 2,313 23 48,542 — — — 48,565

June 26, 2022 90,151 $ 902 $ 1,169,697 $ ( 733,723 ) $ ( 176,054 ) $ 1,919 $ 262,741

December 26, 2021 89,253 $ 893 $ 1,119,728 $ ( 698,171 ) $ ( 205,989 ) $ 6,389 $ 222,850

10 unchanged sentences

Contributions from noncontrolling interests — — — — — 461 461

March 27, 2022 89,185 $ 892 $ 1,115,458 $ ( 634,356 ) $ ( 190,431 ) $ 1,694 $ 293,257

Retirement of convertible senior note hedges — — 112,956 — — — 112,956

Retirement of warrants — — ( 97,617 ) — — — ( 97,617 )

Issuance of common stock from repurchase of convertible senior notes 2,313 23 48,542 — — — 48,565

June 26, 2022 90,151 $ 902 $ 1,169,697 $ ( 733,723 ) $ ( 176,054 ) $ 1,919 $ 262,741

________________

4 unchanged sentences

(DOLLARS IN THOUSANDS, UNAUDITED)

THIRTEEN WEEKS ENDED

MARCH 26, 2023 MARCH 27, 2022

TWENTY-SIX WEEKS ENDED

JUNE 25, 2023 JUNE 26, 2022

Cash flows provided by operating activities:

7 unchanged sentences

Non-cash operating lease costs 42,884 41,336

Stock-based and other non-cash compensation expense 2,904 4,843

Deferred income tax expense 1,682 3,209

Stock-based compensation expense 8,042 9,802

Deferred income tax (benefit) expense ( 1,164 ) 8,329

Loss on extinguishment and modification of debt — 107,630

Loss on fair value adjustment of derivatives, net — 17,685

Other, net ( 3,515 ) 4,935

9 unchanged sentences

Repayments of borrowings on revolving credit facilities ( 513,000 ) ( 304,500 )

(Payments of taxes) proceeds from share-based compensation, net ( 2,778 ) 885

Financing fees — ( 853 )

Principal settlements and repurchase of convertible senior notes ( 214 ) ( 196,919 )

Proceeds from retirement of convertible senior note hedges — 131,869

Payments for retirement of warrants — ( 114,825 )

Proceeds from share-based compensation, net 4,793 2,007

Distributions to noncontrolling interests ( 4,640 ) ( 5,154 )

15 unchanged sentences

Leased assets obtained in exchange for new finance lease liabilities $ 5,367 $ 2,417

Increase (decrease) in liabilities from the acquisition of property, fixtures and equipment $ 1,159 $ ( 6,178 )

Increase in liabilities from the acquisition of property, fixtures and equipment $ 7,522 $ 2,545

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

13 unchanged sentences

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.

Reclassifications - The Company reclassified certain items in the accompanying consolidated financial statements for prior periods to be comparable with the classification for the current period, including, but not limited to, finance lease liabilities presented within other liabilities that were formerly presented within long-term debt, the separate presentation of current operating lease liabilities on the face of the Consolidated Balance Sheets and the presentation of certain items within the Condensed Consolidated Statements of Cash Flows.

These reclassifications had no effect on previously reported net income.

Revenue Recognition

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

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 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Restaurant sales $ 1,137,330 $ 1,108,918 $ 2,365,564 $ 2,232,493

7 unchanged sentences

(UNAUDITED) - Continued

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

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

THIRTEEN WEEKS ENDED

MARCH 26, 2023 MARCH 27, 2022

JUNE 25, 2023 JUNE 26, 2022

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

10 unchanged sentences

Total $ 1,137,330 $ 12,568 $ 1,108,918 $ 12,596

TWENTY-SIX WEEKS ENDED

JUNE 25, 2023 JUNE 26, 2022

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

Outback Steakhouse $ 1,205,172 $ 16,763 $ 1,168,956 $ 16,615

Carrabba’s Italian Grill 364,708 1,553 345,818 1,458

Bonefish Grill 301,147 266 296,888 350

Fleming’s Prime Steakhouse & Wine Bar 195,624 — 191,595 —

Other 7,356 25 6,305 13

total 2,074,007 18,607 2,009,562 18,436

International

Outback Steakhouse - Brazil (1) 241,311 — 185,948 —

Other (1)(2) 50,246 7,484 36,983 7,566

International total 291,557 7,484 222,931 7,566

Total $ 2,365,564 $ 26,091 $ 2,232,493 $ 26,002

________________

(1) Restaurant sales in Brazil increased $ 9.6 million during the thirteen weeks ended March 26, 2023 in connection with value added tax exemptions resulting from recent tax legislation.

(1) Restaurant sales in Brazil increased $ 9.6 million and $ 19.2 million during the thirteen and twenty-six weeks ended June 25, 2023, respectively, in connection with value added tax exemptions resulting from tax legislation.

See Note 12 - Income Taxes for details regarding the Brazil tax legislation.

1 unchanged sentence

Franchise revenues primarily include revenues from franchised Outback Steakhouse restaurants.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

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) MARCH 26, 2023 DECEMBER 25, 2022

(dollars in thousands) JUNE 25, 2023 DECEMBER 25, 2022

Other current assets, net

9 unchanged sentences

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Balance, beginning of the period $ 13,403 $ 13,033 $ 17,755 $ 17,793

3 unchanged sentences

Balance, end of the period $ 12,694 $ 12,338 $ 12,694 $ 12,338

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Balance, beginning of the period $ 314,096 $ 314,974 $ 386,495 $ 387,945

3 unchanged sentences

Balance, end of the period $ 304,942 $ 303,544 $ 304,942 $ 303,544

Earnings Per Share

The following table presents the computation of basic and diluted earnings per share for the periods indicated:

THIRTEEN WEEKS ENDED

(in thousands, except per share data) MARCH 26, 2023 MARCH 27, 2022

Net income attributable to Bloomin’ Brands

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

Earnings (Loss) Per Share

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

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(in thousands, except per share data) JUNE 25, 2023 JUNE 26, 2022 (1) JUNE 25, 2023 JUNE 26, 2022

Net income (loss) attributable to Bloomin’ Brands

$ 68,277 $ ( 63,635 ) $ 159,588 $ 11,876

7 unchanged sentences

Diluted weighted average common shares outstanding 97,401 88,898 97,706 102,045

Basic earnings per share $ 1.02 $ 0.85

Diluted earnings per share $ 0.93 $ 0.73

Share-based compensation-related weighted average securities outstanding not included in the computation of earnings per share because their effect was antidilutive were as follows for the periods indicated:

THIRTEEN WEEKS ENDED

(shares in thousands) MARCH 26, 2023 MARCH 27, 2022

Basic earnings (loss) per share $ 0.77 $ ( 0.72 ) $ 1.80 $ 0.13

Diluted earnings (loss) per share $ 0.70 $ ( 0.72 ) $ 1.63 $ 0.12

______________

(1) Due to the Company’s net loss during the thirteen weeks ended June 26, 2022, the effect of dilutive securities was excluded from the computation of diluted earnings per share as their effect would be antidilutive.

(2) During the thirteen weeks ended June 26, 2022, the Company repurchased $ 125.0 million of the convertible notes due in 2025 and settled the corresponding portion of the related note hedges and warrants (the “2025 Notes Partial Repurchase”).

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

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(shares in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Stock options 689 2,563 707 1,870

2 unchanged sentences

Stock-based Compensation Plans

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

The Company recognized stock-based compensation expense, net of capitalized expense, as follows for the periods indicated:

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Performance-based share units $ 2,297 $ 2,840 $ 3,220 $ 5,459

1 unchanged sentence

Stock options 835 55 835 432

$ 2,886 $ 4,806

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

Total stock-based compensation expense, net $ 5,117 $ 4,922 $ 8,003 $ 9,728

In February 2023, the Company granted performance-based share units (“PSUs”) subject to final payout modification by a Relative Total Shareholder Return (“Relative TSR”) modifier.

1 unchanged sentence

These PSUs have a three-year cliff vesting period and their fair value was estimated using the Monte Carlo simulation model.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

The following table presents a summary of the Company’s PSU activity:

(in thousands, except per unit data) PERFORMANCE-BASED SHARE UNITS WEIGHTED AVERAGE GRANT DATE FAIR VALUE PER UNIT AGGREGATE INTRINSIC VALUE (1)

(in thousands, except per unit data) PERFORMANCE-BASED SHARE UNITS WEIGHTED AVERAGE GRANT DATE FAIR VALUE PER UNIT AGGREGATE

INTRINSIC VALUE (1)

Outstanding as of December 25, 2022 874 $ 24.83 $ 18,323

3 unchanged sentences

Forfeited ( 32 ) $ 26.39

Outstanding as of March 26, 2023 827 $ 26.92 $ 20,630

Expected to vest as of March 26, 2023 1,067 $ 26,611

Outstanding as of June 25, 2023 827 $ 26.92 $ 21,308

Expected to vest as of June 25, 2023 (3) 1,067 $ 27,486

________________

(1) Based on the $ 20.96 and $ 24.94 share price of the Company’s common stock on December 23, 2022 and March 24, 2023, the last trading day of the year ended December 25, 2022 and the thirteen weeks ended March 26, 2023, respectively.

(1) Based on the $ 20.96 and $ 25.76 share price of the Company’s common stock on December 23, 2022 and June 23, 2023, the last trading day of the year ended December 25, 2022 and the twenty-six weeks ended June 25, 2023, respectively.

(2) Represents adjustment to 148 % payout for PSUs granted during 2020.

(3) Estimated number of units to be issued upon the vesting of outstanding PSU awards based on Company performance projections of performance criteria set forth in the 2021, 2022 and 2023 PSU award agreements.

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

THIRTEEN WEEKS ENDED

MARCH 26, 2023 MARCH 27, 2022

TWENTY-SIX WEEKS ENDED

JUNE 25, 2023 JUNE 26, 2022

Risk-free interest rate (1) 4.26 % 1.64 %

7 unchanged sentences

(3) Based on the historical volatility of the Company’s stock over the last seven years.

(4) Represents a premium above the per share value of the Company’s common stock for the Relative TSR modifier as of the grant date of 2.7 % and 7.9 % as of March 26, 2023 and March 27, 2022, respectively.

The following represents unrecognized stock-based compensation expense and the remaining weighted average vesting period as of March 26, 2023:

(4) Represents a premium above the grant date per share value of the Company’s common stock for the Relative TSR modifier of 2.7 % and 7.9 % during the twenty-six weeks ended June 25, 2023 and June 26, 2022, respectively.

The following represents unrecognized stock-based compensation expense and the remaining weighted average vesting period as of June 25, 2023:

UNRECOGNIZED COMPENSATION EXPENSE

7 unchanged sentences

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

(dollars in thousands) MARCH 26, 2023 DECEMBER 25, 2022

(dollars in thousands) JUNE 25, 2023 DECEMBER 25, 2022

Prepaid expenses $ 24,387 $ 29,343

6 unchanged sentences

$ 96,770 $ 183,718

Goodwill and Intangible Assets, Net

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

The Company’s 2023 assessment was quantitative and the 2022 assessment was qualitative.

In connection with these assessments, the Company did no t record any impairment charges.

Long-term Debt, Net

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

MARCH 26, 2023 DECEMBER 25, 2022

JUNE 25, 2023 DECEMBER 25, 2022

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

2 unchanged sentences

2029 Notes 300,000 5.13 % 300,000 5.13 %

Finance lease liabilities 9,114 4,785

unamortized debt discount and issuance costs ( 5,788 ) ( 6,493 )

Total debt, net 767,969 833,292

current portion of long-term debt ( 2,267 ) ( 1,636 )

Long-term debt, net $ 763,998 $ 828,507

1 unchanged sentence

(1) Interest rate represents the weighted average interest rate as of the respective periods.

Debt Covenants - As of March 26, 2023 and December 25, 2022, the Company was in compliance with its debt covenants.

Debt Covenants - As of June 25, 2023 and December 25, 2022, the Company was in compliance with its debt covenants.

Convertible Senior Notes

2025 Notes - In connection with dividends paid during the thirteen weeks ended March 26, 2023, the conversion rate for the Company’s remaining convertible senior notes due 2025 (“2025 Notes”) decreased to approximately $ 11.49 per share, which represents 87.059 shares of common stock per $ 1,000 principal amount of the 2025 Notes, or a total of approximately 9.141 million shares.

2025 Notes - In connection with dividends paid during the twenty-six weeks ended June 25, 2023, the conversion rate for the Company’s remaining convertible senior notes due 2025 (the “2025 Notes”) decreased to approximately $ 11.37 per share, which represents 87.962 shares of common stock per $ 1,000 principal amount of the 2025 Notes, or a total of approximately 9.217 million shares.

BLOOMIN’ BRANDS, INC.

2 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) MARCH 26, 2023 DECEMBER 25, 2022

Long-term debt, net

(dollars in thousands) JUNE 25, 2023 DECEMBER 25, 2022

Principal $ 104,786 $ 105,000

1 unchanged sentence

Net carrying amount $ 103,244 $ 103,061

________________

(1) 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

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Coupon interest $ 1,310 $ 2,597 $ 2,622 $ 5,472

3 unchanged sentences

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

Based on the daily closing prices of the Company’s stock during the quarter ended March 26, 2023, the remaining holders of the 2025 Notes are eligible to convert their 2025 Notes during the second quarter of 2023.

The decrease in interest expense during the thirteen and twenty-six weeks ended June 25, 2023 relates to the 2025 Notes Partial Repurchase in May 2022.

Based on the daily closing prices of the Company’s stock during the quarter ended June 25, 2023, the remaining holders of the 2025 Notes are eligible to convert their notes during the third quarter of 2023.

Stockholders’ Equity

Share Repurchases - On February 8, 2022, the Company’s Board of Directors (the “Board”) approved a share repurchase program (the “2022 Share Repurchase Program”) under which the Company was authorized to repurchase up to $ 125.0 million of its outstanding common stock.

During the thirteen weeks ended March 26, 2023, the Company fully utilized the remaining share repurchase authorization under the 2022 Share Repurchase Program.

On February 7, 2023, the Company’s Board approved a new $ 125.0 million authorization (the “2023 Share Repurchase Program”) expiring on August 7, 2024.

As of March 26, 2023, $ 119.4 million remained available for repurchase under the 2023 Share Repurchase Program.

Share Repurchases - On February 7, 2023, the Company’s Board of Directors (the “Board”) approved a share repurchase program (the “2023 Share Repurchase Program”) under which the Company is authorized to repurchase up to $ 125.0 million of its outstanding common stock.

The 2023 Share Repurchase Program will expire on August 7, 2024.

As of June 25, 2023, $ 103.8 million remained available for repurchase under the 2023 Share Repurchase Program.

Following is a summary of the shares repurchased during fiscal year 2023:

1 unchanged sentence

First fiscal quarter 863 $ 23.92 $ 20,645

Second fiscal quarter 619 $ 25.11 15,539

Total common stock repurchases (1) 1,482 $ 24.42 $ 36,184

________________

(1) Excludes excise tax on share repurchases.

Subsequent to March 26, 2023, the Company repurchased 291 thousand shares of its common stock for $ 7.2 million under a Rule 10b5-1 plan.

Subsequent to June 25, 2023, the Company repurchased 269 thousand shares of its common stock for $ 7.3 million under a Rule 10b5-1 plan.

Dividends - The Company declared and paid dividends per share during fiscal year 2023 as follows:

1 unchanged sentence

First fiscal quarter $ 0.24 $ 21,014

In April 2023, the Board declared a quarterly cash dividend of $ 0.24 per share, payable on May 24, 2023 to shareholders of record at the close of business on May 10, 2023 .

Second fiscal quarter 0.24 20,990

Total cash dividends declared and paid $ 0.48 $ 42,004

In July 2023, the Board declared a quarterly cash dividend of $ 0.24 per share, payable on August 25, 2023 to shareholders of record at the close of business on August 14, 2023 .

BLOOMIN’ BRANDS, INC.

1 unchanged sentence

(UNAUDITED) - Continued

Accumulated Other Comprehensive Loss (“AOCL”) - AOCL consisted of foreign currency translation adjustments as of March 26, 2023 and December 25, 2022.

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

Accumulated Other Comprehensive Loss (“AOCL”) - AOCL consisted of foreign currency translation adjustments as of June 25, 2023 and December 25, 2022.

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

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Foreign currency translation adjustment $ 4,502 $ 11,940 $ 3,368 $ 23,223

Unrealized gain on derivatives, net of tax — — — 573

Reclassification of adjustments for loss on derivatives included in Net income, net of tax — 681

Impact of terminated interest rate swaps included in Net income, net of tax — 3,021

Reclassification of adjustments for loss on derivatives included in Net income (loss), net of tax — 273 — 954

Impact of terminated interest rate swaps included in Net income (loss), net of tax — 2,164 — 5,185

Total gain on derivatives, net of tax — 2,437 — 6,712

Other comprehensive (loss) income attributable to Bloomin’ Brands $ ( 1,134 ) $ 15,558

Other comprehensive income attributable to Bloomin’ Brands $ 4,502 $ 14,377 $ 3,368 $ 29,935

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 MARCH 26, 2023 DECEMBER 25, 2022

(dollars in thousands) CONSOLIDATED BALANCE SHEET CLASSIFICATION JUNE 25, 2023 DECEMBER 25, 2022

Operating lease right-of-use assets Operating lease right-of-use assets $ 1,089,218 $ 1,103,083

1 unchanged sentence

Total lease assets, net $ 1,099,263 $ 1,107,762

Current operating lease liabilities (2) Accrued and other current liabilities $ 182,782 $ 183,510

Current finance lease liabilities Current portion of long-term debt 2,267 1,636

Current operating lease liabilities Current operating lease liabilities $ 185,362 $ 183,510

Current finance lease liabilities Accrued and other current liabilities 2,508 1,636

Non-current operating lease liabilities (2) Non-current operating lease liabilities 1,131,843 1,148,379

Non-current finance lease liabilities Long-term debt, net 6,847 3,149

Non-current finance lease liabilities Other long-term liabilities, net 8,037 3,149

Total lease liabilities $ 1,327,750 $ 1,336,674

________________

(1) Net of accumulated amortization of $ 3.0 million and $ 3.6 million as of March 26, 2023 and December 25, 2022, respectively.

(2) Excludes current accrued contingent percentage rent of $ 3.4 million as of March 26, 2023 and December 25, 2022 and immaterial current and non-current COVID-19-related deferred rent accruals.

(1) Net of accumulated amortization of $ 3.5 million and $ 3.6 million as of June 25, 2023 and December 25, 2022, respectively.

(2) Excludes immaterial COVID-19-related deferred rent accruals.

BLOOMIN’ BRANDS, INC.

1 unchanged sentence

(UNAUDITED) - Continued

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

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME CLASSIFICATION THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

Operating leases (1) Other restaurant operating $ 45,747 $ 45,361

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 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Operating lease cost (1) Other restaurant operating $ 46,237 $ 45,579 $ 91,984 $ 90,940

Variable lease cost Other restaurant operating 1,629 1,619 3,353 3,502

Finance leases:

Finance lease costs:

Amortization of leased assets Depreciation and amortization 549 356 1,037 693

3 unchanged sentences

________________

(1) Excludes rent expense for office facilities and Company-owned closed or subleased properties of $ 3.0 million for both the thirteen weeks ended March 26, 2023 and March 27, 2022, which is included in General and administrative expense.

(1) Excludes rent expense for office facilities and Company-owned closed or subleased properties of $ 3.0 million and $ 3.1 million for the thirteen weeks ended June 25, 2023 and June 26, 2022, respectively, and $ 6.0 million and $ 6.1 million for the twenty-six weeks ended June 25, 2023 and June 26, 2022, respectively, which is included in General and administrative expense.

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022

Cash flows from operating activities:

7 unchanged sentences

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

MARCH 26, 2023 DECEMBER 25, 2022

JUNE 25, 2023 DECEMBER 25, 2022

(dollars in thousands) TOTAL LEVEL 1 TOTAL LEVEL 1

5 unchanged sentences

(1) Carrying value approximates fair value because maturities are less than three months.

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

Interim Disclosures about Fair Value of Financial Instruments - The Company’s financial instruments consist of cash equivalents, accounts receivable, accounts payable 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.

5 unchanged sentences

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

MARCH 26, 2023 DECEMBER 25, 2022

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

(dollars in thousands)

JUNE 25, 2023 DECEMBER 25, 2022

(dollars in thousands) CARRYING VALUE FAIR VALUE LEVEL 2 CARRYING VALUE FAIR VALUE LEVEL 2

Senior secured credit facility - revolving credit facility $ 365,000 $ 365,000 $ 430,000 $ 430,000

1 unchanged sentence

2029 Notes $ 300,000 $ 269,343 $ 300,000 $ 260,265

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

Income before provision for income taxes $ 108,189 $ 93,623

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Income (loss) before provision for income taxes $ 76,485 $ ( 50,144 ) $ 184,674 $ 43,479

Provision for income taxes $ 6,483 $ 11,536 $ 21,244 $ 27,465

Effective income tax rate 8.5 % ( 23.0 ) % 11.5 % 63.2 %

The effective income tax rate for the thirteen weeks ended March 26, 2023 decreased by 3.4 percentage points as compared to the thirteen weeks ended March 27, 2022.

This decrease was primarily due to the benefits of Brazil tax legislation that include a temporary reduction in the Brazilian income tax rate from 34 % to 0 % applicable to the thirteen weeks ended March 26, 2023.

In September 2022, the Company’s Brazilian subsidiary received a preliminary injunction authorizing it to benefit from the exemptions enacted by Law 14,148/2021 which provides for emergency and temporary actions that would grant certain industries a 100 % exemption from income tax (IRPJ and CSLL) and federal value added taxes (PIS and COFINS) for a five-year period.

The effective income tax rate for the thirteen weeks ended June 25, 2023 changed by 31.5 percentage points as compared to the thirteen weeks ended June 26, 2022.

This change is primarily due to the non-deductible losses associated with the 2025 Notes Partial Repurchase which, relative to the Loss before provision for income taxes during the thirteen weeks ended June 26, 2022, resulted in a negative effective income tax rate.

This change was partially offset by a reduction in the effective tax rate during the thirteen weeks ended June 25, 2023 from benefits of Brazil tax legislation that include a temporary reduction in the Brazilian income tax rate from 34 % to 0 % and the revaluation of Brazilian deferred tax assets and liabilities as a result of the May 2023 Brazil tax legislation, as defined and further discussed below.

The effective income tax rate for the twenty-six weeks ended June 25, 2023 decreased by 51.7 percentage points as compared to the twenty-six weeks ended June 26, 2022.

This decrease was primarily due to the benefits of Brazil tax legislation that include a temporary reduction in the Brazilian income tax rate from 34 % to 0 % for the twenty-six weeks ended June 25, 2023, and the non-deductible losses associated with the 2025 Notes Partial Repurchase recorded during the twenty-six weeks ended June 26, 2022.

In September 2022, the Company’s Brazilian subsidiary received a preliminary injunction authorizing it to benefit from the exemptions enacted by Law 14,148/2021 which provides for emergency and temporary actions that grant certain industries a 100 % exemption from income tax (IRPJ and CSLL) and federal value added taxes (PIS and COFINS) for a five-year period.

The injunction was issued as part of an ongoing lawsuit initiated by the Company’s Brazilian subsidiary due to the uncertainty regarding the restaurant industry’s eligibility for the exemptions under this legislation.

The Company will continue to evaluate and assess the exemptions, the status of its preliminary injunction and all other available evidence to determine the exemption status with respect to this subsidiary in future periods.

In May 2023, Brazil enacted tax legislation that prospectively limits the Company’s ability to benefit from the 100 % exemption from income tax (IRPJ and CSLL) and federal value added taxes (PIS and COFINS) for the full five-year period (the “May 2023 Brazil tax legislation”).

As a result of this legislation, the Company expects to be subject to PIS and COFINS and CSLL beginning in the fourth quarter of 2023 and IRPJ beginning in 2024.

A restaurant company employer may claim a credit against its federal income taxes for FICA taxes paid on certain tipped wages (the “FICA tax credit”).

The level of FICA tax credits is primarily driven by U.S.

Restaurant sales and is not impacted by costs incurred that may reduce pre-tax income.

The effective income tax rate for the thirteen weeks ended March 26, 2023 was lower than the Company’s blended federal and state statutory rate of approximately 26 % primarily due to the benefit of FICA tax credits on certain tipped wages and benefits of Brazil tax legislation that include a temporary reduction in the Brazilian income tax rate from 34 % to 0 %.

Restaurant sales and is not impacted by costs incurred that may reduce Income before provision for income taxes.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

The effective income tax rates for the thirteen and twenty-six weeks ended June 25, 2023 were lower than the Company’s blended federal and state statutory rate of approximately 26 % primarily due to the benefit of FICA tax credits on certain tipped wages, benefits of Brazil tax legislation that include a temporary reduction in the Brazilian income tax rate from 34 % to 0 %, and the revaluation of Brazilian deferred tax assets and liabilities as a result of the May 2023 Brazil tax legislation.

The effective income tax rate for the thirteen weeks ended June 26, 2022 was lower than the Company’s blended federal and state statutory rate of approximately 26 %.

The income tax rate includes the impact of non-deductible losses associated with the 2025 Notes Partial Repurchase which, relative to the Loss before provision for income taxes during the quarter, resulted in a negative effective income tax rate.

The effective income tax rate for the twenty-six weeks ended June 26, 2022 was higher than the statutory rate primarily due to the non-deductible losses associated with the 2025 Notes Partial Repurchase recorded during the twenty-six weeks ended June 26, 2022.

Commitments and Contingencies

4 unchanged sentences

The Company evaluates, on a quarterly basis, developments in legal proceedings that could cause an increase or decrease in the amount of the reserve that has been previously recorded, or a revision to the disclosed estimated range of possible losses, as applicable.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

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

8 unchanged sentences

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.

The Company recorded reserves of $ 15.9 million and $ 15.1 million for certain of its outstanding legal proceedings as of March 26, 2023 and December 25, 2022, respectively, within Accrued and other current 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.

The Company recorded reserves of $ 16.4 million and $ 15.1 million for certain of its outstanding legal proceedings as of June 25, 2023 and December 25, 2022, respectively, within Accrued and other current liabilities on its Consolidated Balance Sheets.

While the Company believes that additional losses beyond these accruals are

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

reasonably possible, it cannot estimate a possible loss contingency or range of reasonably possible loss contingencies beyond these accruals.

Lease Guarantees - The Company assigned its interest, and is contingently liable, under certain real estate leases.

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

As of March 26, 2023, the undiscounted payments that the Company could be required to make in the event of non-payment by the primary lessees was approximately $ 22.7 million.

The present value of these potential payments discounted at the Company’s incremental borrowing rate as of March 26, 2023 was approximately $ 17.2 million.

As of June 25, 2023, the undiscounted payments that the Company could be required to make in the event of non-payment by the primary lessees was approximately $ 21.9 million.

The present value of these potential payments discounted at the Company’s incremental borrowing rate as of June 25, 2023 was approximately $ 16.5 million.

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

As of March 26, 2023 and December 25, 2022, the Company’s recorded contingent lease liability was $ 6.2 million.

As of June 25, 2023 and December 25, 2022, the Company’s recorded contingent lease liability was $ 5.6 million and $ 6.2 million, respectively.

Segment Reporting

9 unchanged sentences

(1) Includes franchise locations.

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

Segment accounting policies are the same as those described in Note 2 - Summary of Significant Accounting Policies in the Company’s Annual Report on Form 10-K for the year ended December 25, 2022.

2 unchanged sentences

and international are certain legal and corporate costs not directly related to the performance of the segments, most stock-based compensation expenses, certain insurance expenses and certain bonus expenses.

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

Total revenues

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

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

$ 1,005,229 $ 998,627 $ 2,098,225 $ 2,035,034

1 unchanged sentence

Total revenues $ 1,152,694 $ 1,125,162 $ 2,397,440 $ 2,265,697

The following table is a reconciliation of segment income from operations to Income before provision for income taxes for the periods indicated:

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

BLOOMIN’ BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) - Continued

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

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Segment income from operations

4 unchanged sentences

Total income from operations 89,446 87,719 210,079 194,975

Loss on extinguishment and modification of debt — ( 107,630 ) — ( 107,630 )

Loss on fair value adjustment of derivatives, net — ( 17,685 ) — ( 17,685 )

Interest expense, net ( 12,961 ) ( 12,548 ) ( 25,405 ) ( 26,181 )

Income before provision for income taxes $ 108,189 $ 93,623

Income (loss) before provision for income taxes $ 76,485 $ ( 50,144 ) $ 184,674 $ 43,479

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

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

Depreciation and amortization

3 unchanged sentences

Total depreciation and amortization $ 47,565 $ 41,257 $ 93,867 $ 83,032

Geographic Areas - International revenues are defined as revenues generated from restaurant sales originating in a country other than the U.S.

Geographic Areas - International assets are defined as assets residing in a country other than the U.S.

The following table details long-lived assets, excluding goodwill, operating lease right-of-use assets, intangible assets and deferred tax assets, by major geographic area as of the periods indicated:

(dollars in thousands) JUNE 25, 2023 DECEMBER 25, 2022

$ 945,616 $ 891,379

International

Brazil 108,791 93,972

Other 8,970 10,938

Total long-lived assets $ 1,063,377 $ 996,289

International revenues are defined as revenues generated from restaurant sales originating in a country other than the U.S.

The following table details Total revenues by major geographic area for the periods indicated:

THIRTEEN WEEKS ENDED

(dollars in thousands) MARCH 26, 2023 MARCH 27, 2022

THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED

(dollars in thousands) JUNE 25, 2023 JUNE 26, 2022 JUNE 25, 2023 JUNE 26, 2022

$ 1,005,229 $ 998,627 $ 2,098,225 $ 2,035,034

7 unchanged sentences

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