What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2021-08-26 compared with 2020-08-24 · 22 added, 64 removed, 17 unchanged (83% of the section changed)

2 unchanged sentences

Comparison of Five Year Cumulative Total Return

The graph below presents Brinker International, Inc.’s cumulative 5-Year total shareholder return on common stock with the cumulative total returns of the S&P 500 index and the S&P Restaurants index.

The graph is based on $100 invested on June 24, 2015 in stock including reinvestment of dividends, or June 30, 2015 in index since indexes are calculated on a month-end basis, and its relative performance is tracked through June 24, 2020 .

The graph below presents Brinker International, Inc.’s cumulative 5-Year total shareholder return on common stock relative to the cumulative total returns of the S&P 500 index and the S&P Restaurants index for the period of June 29, 2016 through June 30, 2021.

The graph is based on $100 invested as of June 29, 2016 in the Company’s common stock and each index, including the reinvestment of all dividends.

The values shown below are neither indicative nor determinative of future performance.

Fiscal 2016 Fiscal 2017 Fiscal 2018 Fiscal 2019 Fiscal 2020 Fiscal 2021

Brinker International $ 100.00 $ 85.05 $ 115.30 $ 92.16 $ 58.35 $ 153.39

S&P 500 $ 100.00 $ 117.90 $ 134.84 $ 148.89 $ 160.06 $ 225.36

S&P Restaurants (1)

$ 100.00 $ 120.50 $ 119.77 $ 177.35 $ 161.57 $ 226.68

(1) The S&P Restaurants Index is comprised of Chipotle Mexican Grill, Inc., Darden Restaurants, Inc., McDonald’s Corp., Domino’s Pizza Inc., Starbucks Corporation and Yum!

Dividend Program

In the third quarter of fiscal 2020, we declared a quarterly dividend on January 27, 2020 , that was paid in the fourth quarter of fiscal 2020, on March 26, 2020 , in the amount of $0.38 per share.

In the fourth quarter of fiscal 2020, our Board of Directors voted to suspend the quarterly cash dividend due to uncertainty surrounding the duration of closures of our dining rooms and other restrictions mandated by state and local governments in response to COVID-19.

Additionally, under the terms of our revolving credit facility, as recently amended, we are prohibited from making dividends, stock repurchases and investments from the fourth quarter of fiscal 2020 through the third quarter of fiscal 2021, and following this period, we will be subject to a $50.0 million aggregate limitation on dividends, stock repurchases and investments.

Following the expiration of these restrictions, the Board of Directors will reevaluate the suspension based on current business conditions at that time .

Refer to Part II , Item 7 - Management’s

Discussion and Analysis of Financial Condition and Results of Operations , Liquidity and Capital Resources for further information.

Once permitted under the terms of our lending arrangements, future decisions to reinstate the dividend program to pay, or to increase or decrease dividends, are at the discretion of the Board and will be dependent on our operating performance, financial condition, capital expenditure requirements, limitations on cash distributions pursuant to the terms and conditions of our revolving credit facility and applicable law, and such other factors that the Board considers relevant.

Refer to Part II , Item 8 - Financial Statements and Supplementary Data , Notes to the Consolidated Financial Statements , Note 12 - Debt and Note 15 - Shareholders’ Deficit of this Annual Report on Form 10-K for further discussion of our long-term debt and shareholders’ deficit, respectively.

Additionally, under the terms of our revolving credit facility, we were prohibited from making dividends, stock repurchases and investments from the fourth quarter of fiscal 2020 through the third quarter of fiscal 2021, and following this period, we were subject to a $50.0 million aggregate limitation on dividends, stock repurchases and investments.

Future decisions to reinstate the dividend program to pay, or to increase or decrease dividends, are at the discretion of the Board of Directors and will be dependent on our operating performance, financial condition, capital expenditure requirements, limitations on cash distributions pursuant to the terms and conditions of our revolving credit facility and applicable law, and such other factors that the Board of Directors considers relevant.

Refer to Part II, Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations, Liquidity and Capital Resources for further information.

Refer to Part II, Item 8 - Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 10 - Debt and Note 13 - Shareholders’ Deficit of this Annual Report on Form 10-K for further discussion of our long-term debt and shareholders’ deficit, respectively.

Share Repurchase Program

In the fourth quarter of fiscal 2020, our Board of Directors voted to suspend our share repurchase program due to uncertainty surrounding the duration of closures of our dining rooms and other restrictions mandated by state and local governments in response to COVID-19.

Additionally, the amended revolving credit facility restricts our ability to repurchase shares until the fourth quarter of fiscal year 2021, and subjects any share purchases thereafter, along with dividends paid and investments, to an aggregate cap.

As such, in the fourth quarter of fiscal 2020 , we only repurchased a limited number of shares related to shares owned and tendered by team members to satisfy tax withholding obligations, and vesting of restricted share awards, which are not deducted from shares available to be purchased under publicly announced programs.

In the fourth quarter of fiscal 2020, our share repurchase program was suspended in response to the business downturn caused by the COVID-19 pandemic.

Additionally, the amended revolving credit facility restricted our ability to repurchase shares in fiscal 2021 through the third quarter of fiscal 2021.

Following the expiration of these restrictions under our amended revolving credit facility, we did not repurchase any shares under publicly announced share repurchase programs for the remainder of fiscal 2021.

Future decisions to repurchase shares will be dependent on our operating performance, financial condition and other such factors that we consider relevant.

We repurchased a limited number of shares related to shares owned and tendered by team members to satisfy tax withholding obligations on the vesting of restricted share awards.

These purchases are not deducted from shares available to be purchased under publicly announced programs.

Amounts are presented in millions, except per share amounts, unless otherwise noted:

Purchased (1)

per Share Total Number

Part of Publicly

Approximate Dollar Value that May Yet be

Program Approximate Dollar Value that May Yet be

Under the Program (2)

2 unchanged sentences

May 27, 2021 through June 30, 2021 0.0 $ 75.32 — $ 166.8

Total 0.0 $ 73.77 —

(1) Shares owned and tendered by team members to satisfy tax withholding obligations were purchased at the average of the high and low prices of the Company’s shares on the date of vesting.

In the fourth quarter of fiscal 2020 , 6.4 thousand shares were tendered by team members at an average price of $24.50 .

SELECTED FINANCIAL DATA

BRINKER INTERNATIONAL, INC.

Selected Financial Data

(In millions, except per share amounts and number of restaurants)

Fiscal Years Ended

6/24/2020 (1)(2)

6/26/2019 (2)

6/29/2016 (3)

Income Statement Data:

Company sales

Franchise and other revenues

Total revenues

Operating costs and expenses

Food and beverage costs

Restaurant labor

Restaurant expenses

Depreciation and amortization

General and administrative

Other (gains) and charges

Total operating costs and expenses

Operating income

Interest expenses

Other (income), net

Income before income taxes

Provision (benefit) for income taxes

Basic net income per share

Diluted net income per share

Basic weighted average shares outstanding

Diluted weighted average shares outstanding

Balance Sheet Data:

Working capital

Total assets (4)

Long-term obligations (4)

Shareholders’ deficit

Dividends per share

Number of Restaurants Open (End of Year):

Company-owned

Revenues of Franchisees (5)

Fiscal 2020 reflects the impact of the adoption of the new lease accounting standard using the alternative transition method.

All other periods presented have not been restated.

Refer to Part II, Item 8 - Financial Statements and Supplementary Data , Notes to the Consolidated Financial Statements , Note 1 - Nature of Operations and Summary of Significant Accounting Policies and Note 4 - Leases for information regarding our adoption of the new revenue standard.

Fiscal 2020 and fiscal 2019 reflect the impact of the adoption of the new revenue recognition accounting standard using the modified retrospective transition method.

All other periods presented have not been restated.

Fiscal 2016 consisted of 53 weeks while all other periods presented consisted of 52 weeks.

Debt issuance costs are presented in the Consolidated Balance Sheets as a direct deduction from the associated debt liability.

Amounts presented for fiscal years prior to fiscal 2017 were reclassified from Other assets to Long-term debt to conform to the current presentation.

Revenues of Franchisees represent the gross sales reported by our franchisees.

Royalty revenues recognized by us are based on these sales generated and reported to us by franchisees.

In the fourth quarter of fiscal 2021, 564 shares were tendered by team members at an average price of $73.77.

(2) Subsequent to fiscal 2021 year-end, our Board of Directors reinstated the share repurchase program, allowing for a total available repurchase authority of $300 million.

Removed and Reserved.

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-K

Item 5. Market for Registrant’s Common Equity