3 unchanged sentences
We attempt to minimize interest rate risk exposure by fixing our interest rate through the utilization of interest rate swaps, which are derivative financial instruments.
−Removed: The interest rate swaps were eligible for hedge accounting for part of the period and were de-designated following the issuance of the Notes.
+Added: The interest rate swaps were eligible for hedge accounting for part of the period.
Our swaps are entered into with financial institutions that participate in the PJI Revolving Facility.
1 unchanged sentence
We do not enter into contracts for trading purposes and do not use leveraged instruments.
−Removed: See “Note 12” of “Notes to Consolidated Financial Statements” for additional information on our debt obligations and derivative instruments.
+Added: See “Note 12.
+Added: Debt” of “Notes to Consolidated Financial Statements” for additional information on our debt obligations and derivative instruments.
Foreign Currency Exchange Rate Risk
We are exposed to foreign currency exchange rate fluctuations from our operations outside of the United States, which can adversely impact our revenues, net income and cash flows.
−Removed: Our international operations principally consist of distribution sales to franchised Papa John’s restaurants located in the United Kingdom and our franchise sales and support activities, which derive revenues from sales of franchise and development rights and the collection of royalties from our international franchisees.
+Added: Our International operations principally consist of distribution sales to franchised Papa John’s restaurants located in the UK and our franchise sales and support activities, which derive revenues from sales of franchise and development rights and the collection of royalties from our International franchisees.
Approximately 6.2% of our 2022 revenues, 7.3% of our 2021 revenues and 6.8% of our 2020 revenues were derived from these International operations.
We have not historically hedged our exposure to foreign currency fluctuations.
−Removed: Foreign currency exchange rate fluctuations had a favorable impact of approximately $8.1 million on our consolidated revenues in 2021 compared to an unfavorable impact of approximately $600,000 in 2020.
−Removed: Foreign currency exchange rates had a favorable impact of $1.4 million on our operating income in 2021 compared to an unfavorable impact of $1.0 million in 2020.
−Removed: A 10% adverse change in the foreign currency rates for our international markets would result in an additional negative impact on annual revenue and operating income of approximately $15.6 million and $3.3 million, respectively.
+Added: Foreign currency exchange rate fluctuations had an unfavorable impact of approximately $13.3 million on our total revenues in 2022, compared to a favorable impact of approximately $8.1 million in 2021 and an unfavorable impact of approximately $0.6 million in 2020.
+Added: Foreign currency exchange rate fluctuations had an unfavorable impact of $2.0 million on our operating income in 2022 compared to a favorable impact of $1.4 million in 2021 and an unfavorable impact of $1.0 million in 2020.
+Added: A 10% adverse change in the foreign currency rates for our International markets would result in an additional negative impact on annual revenue and operating income of approximately $13.6 million and $1.5 million, respectively, based on annual revenue and operating income for the year ended December 25, 2022.
Commodity Price Risk
4 unchanged sentences
Also presented is the projected 2023 average block price by quarter (based on the February 16, 2023 Chicago Mercantile Exchange cheese futures prices):
+Added: 2023 2022 2021 2020
+Added: Quarter 1 $ 1.951 $ 1.966 $ 1.676 $ 1.857
+Added: Quarter 2 1.934 2.296 1.680 1.679
+Added: Quarter 3 2.066 1.938 1.676 2.262
+Added: Quarter 4 2.062 2.066 1.786 2.235
+Added: Full Year $ 2.003 $ 2.067 $ 1.705 $ 2.008
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.