Quarterly report pursuant to Section 13 or 15(d)

Segment Reporting

v3.19.1
Segment Reporting
 3 Months Ended
Mar. 31, 2019
Segment Reporting [Abstract]  
Segment Reporting

Note 16 - Segment Reporting

 

The Company operates in three segments: “Owned restaurants,” “Owned food, beverage and other,” and “Managed and licensed operations.” The Owned restaurants segment consists of leased restaurant locations and competes in the full-service dining industry. The Owned food, beverage and other segment consists of hybrid operations, such as where the Company has a leased restaurant location and also has a food and beverage agreement at the same location, typically a hotel, and offsite banquet offerings. The Managed and licensed operations segment includes all operations for which a management, incentive or license fee is received. Management agreements generate management fees on net revenue and incentive fees on operating profit as defined in the applicable management agreement. License agreements generate revenue primarily through royalties earned on net revenue at each location. Revenues associated with developmental support for licensed locations are also included within this segment.

 

The Company’s Chief Executive Officer (“CEO”), who has been deemed the Company’s Chief Operating Decision Maker, manages the business and allocates resources via a combination of restaurant sales reports and segment profit information (which is defined as revenues less operating expenses) related to the Company’s three segments, or sources of revenues, which are presented in their entirety within the consolidated statements of operations and comprehensive income.

 

The Company’s operating results by segment were as follows (in thousands):

 

    For the three months ended March 31, 2019  
    Owned 
restaurants		     Owned food, 
beverage and 
other		     Managed and 
licensed 
operations		     Total  
Revenues:                                
Owned net revenues   $ 17,820     $ 2,273     $ —     $ 20,093  
Management, license and incentive fee revenue     —       —       2,683       2,683  
Total revenues     17,820       2,273       2,683       22,776  
                                 
Cost and expenses:                                
Owned operating expenses:                                
Cost of sales     4,569       —       —       4,569  
Other operating expenses     10,915       —       —       10,915  
Owned food, beverage and other expenses     —       2,259       —       2,259  
Total owned operating expenses     15,484       2,259       —       17,743  
Segment income   $ 2,336     $ 14     $ 2,683     $ 5,033  
                                 
General and administrative                             2,650  
Depreciation and amortization                             942  
Interest expense, net of interest income                             269  
Equity in income of investee companies                             —  
Other                             307  
Income before provision for income taxes                           $ 865  

 

    For the three months ended March 31, 2018  
    Owned 
restaurants		     Owned food, 
beverage and 
other		     Managed and 
licensed 
operations		     Total  
Revenues:                                
Owned net revenues   $ 15,076     $ 2,005     $ —     $ 17,081  
Management, license and incentive fee revenue     —       —       2,436       2,436  
Total revenues     15,076       2,005       2,436       19,517  
                                 
Cost and expenses:                                
Owned operating expenses:                                
Cost of sales     4,034       —       —       4,034  
Other operating expenses     9,378       —       —       9,378  
Owned food, beverage and other expenses     —       1,689       —       1,689  
Total owned operating expenses     13,412       1,689       —       15,101  
Segment income   $ 1,664     $ 316     $ 2,436     $ 4,416  
                                 
General and administrative                             3,055  
Depreciation and amortization                             778  
Interest expense, net of interest income                             318  
Equity in loss of investee companies                             23  
Other                             99  
Income before provision for income taxes                           $ 143  

 

The Company’s total assets by segment for the periods indicated were as follows (in thousands):

 

    March 31,     December 31,  
    2019     2018  
Total assets:                
Owned restaurants   $ 75,272     $ 42,971  
Owned food, beverage and other operations (1)     15,591       7,274  
Managed and licensed operations     4,728       5,734  
Total   $ 95,591     $ 55,979  

 

(1) Includes corporate assets

  

The Company’s total assets increased $40.1 million as of March 31, 2019 compared to December 31, 2018 as a result of adopting ASC Topic 842 during the first quarter of 2019. Refer to Note 12 for additional information regarding the adoption of ASC Topic 842.

 

The Company’s capital asset additions by segment for the periods indicated were as follows (in thousands):

 

    For the three months ended March 31,  
    2019     2018  
Capital assets additions:                
Owned restaurants   $ 1,762     $ 301  
Owned food, beverage and other operations (1)     298       5  
Managed and licensed operations     —       —  
Total   $ 2,060     $ 306  

 

(1) Includes corporate capital asset additions