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OFFON

BRINKER INTERNATIONAL, INC.

(EAT)
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BRINKER INTERNATIONAL, INC MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-Q)

11/03/2021 | 03:54pm EST

General

The following Management's Discussion and Analysis of Financial Condition and
Results of Operations ("MD&A") is intended to help you understand our Company,
our operations, and our current operating environment. For an understanding of
the significant factors that influenced our performance during the thirteen week
periods ended September 29, 2021 and September 23, 2020, the MD&A should be read
in conjunction with the Consolidated Financial Statements (Unaudited) and
related Notes to Consolidated Financial Statements (Unaudited) included in this
quarterly report. All amounts within the MD&A are presented in millions unless
otherwise specified.
Overview
We are principally engaged in the ownership, operation, development and
franchising of the Chili's® Grill & Bar ("Chili's") and Maggiano's Little Italy®
("Maggiano's") restaurant brands, as well as virtual brands including It's Just
Wings® and Maggiano's Italian Classics™. At September 29, 2021, we owned,
operated or franchised 1,650 restaurants, consisting of 1,145 Company-owned
restaurants and 505 franchised restaurants, located in the United States, 28
countries and two United States territories. Our restaurant brands, Chili's and
Maggiano's, are both operating segments and reporting units.

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Impact of COVID-19 Pandemic
In March 2020, a novel strain of coronavirus ("COVID-19") was declared a global
pandemic and a National Public Health Emergency. The spread of COVID-19 has
prompted changes in consumer behavior and social distancing preferences as well
as dining room closures and dining room capacity restrictions mandated or
encouraged by federal, state and local governments. The number of open dining
rooms and the dining room capacity restrictions have fluctuated over the course
of the pandemic based on state and local mandates, which has resulted in
significant impacts to our guest traffic and sales. At the end of the first
quarter of fiscal 2022, all of our Company-owned restaurant dining rooms or
patios were open in some capacity.
Chili's and Maggiano's ability to continue serving guests during the COVID-19
pandemic is the result of our strategic decision to invest in technology,
virtual brands, and off-premise capabilities including online ordering, mobile
app ordering, curbside service and third-party delivery.
We have experienced limited material shortages and service disruptions in our
supply chain and in the availability of labor to operate our restaurants. We
also experienced an increase in employee turnover in the first quarter of fiscal
2022. We recognize there is significant demand for talent and are actively
working to safeguard, engage, attract and retain our employees. It is possible
that shortages or disruptions could increase during fiscal 2022 as demand for
goods, transportation and labor increases.
Impact on Financial Outlook
The ultimate impact of the COVID-19 pandemic cannot be reasonably estimated due
to the uncertainty about the extent and duration of the spread of the virus, the
availability, acceptance and efficacy of preventative vaccines, the emergence
and impact of new COVID-19 variants and changing government restrictions.
Additional impacts to the business may arise that we are not aware of currently.
We will continue to closely monitor and adapt to the evolving situation.
Operations Strategy
We are committed to strategies and a Company culture that we believe will
improve guest traffic, grow sales and profits, and engage team members. Our
strategies and culture are intended to differentiate our brands from the
competition and to focus on the guest experience. We are effectively and
efficiently managing our restaurants to establish a lasting presence for our
brands in key markets around the world. Our primary strategy is to make our
guests feel special through great food and quality service so that they return
to our restaurants.
Guest Engagement Through Technology - We have invested in our technology and
off-premise options as more guests are opting for To-Go and delivery. Chili's
partnership with DoorDash has been instrumental in growing off-premise business
and offering our guests continued service during the COVID-19 pandemic. We
leveraged technology so that DoorDash orders are sent directly into our point of
sale system, creating efficiencies and a system that allows us to better serve
our guests. We believe that guests will continue to prefer convenience and
off-premise options. We plan to continue investments in our technology systems
to support our To-Go and delivery capabilities.
In dining rooms, we use tabletop devices to engage our guests at the table.
These devices allow guests to pay at the table, reordering, digital
entertainment, guest feedback and interaction with our My Chili's Rewards
program. Our My Chili's Rewards loyalty program offers free chips and salsa or a
non-alcoholic beverage to members based on their visit frequency. We customize
offerings for these guests based on their purchase behavior, and we continue to
shift more of our overall marketing spend to these customized channels and
promotions. We believe this strategy gives us a sustained competitive advantage
over independent restaurants and the majority of our competitors.
Chili's - Chili's strategy is to differentiate from our competitors with a
flexible platform of value offerings at both lunch and dinner and to connect
with our guests through our My Chili's Rewards loyalty program. We are committed
to offering consistent, quality products at a price point that is compelling to
our guests. Our value platforms allow guests to mix and match select menu items
at a discounted price as part of the every-day base menu. Additionally, we have
continued our Margarita of the Month promotion that features a premium-liquor
margarita

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every month at an every-day value price of $5.00. Most of our value propositions
are available for guests to enjoy in our dining rooms or off-premise.
Chili's off-premise dining options, including our virtual brands It's Just Wings
and Maggiano's Italian Classics, are also a critical part of our strategy. In
the first quarter of fiscal 2022, Chili's off-premise sales, including both
to-go and delivery, were approximately 35% of Company sales, with approximately
55% coming from To-Go and 45% from delivery. We regularly evaluate our processes
and menu at Chili's to identify opportunities where we can improve our service
quality and food. We continue to focus on our core equities and improving guest
satisfaction with our food and service by improving execution of our operations
standards.
Maggiano's - At Maggiano's, we believe our focus on operating fundamentals and
technology provide the foundation for future efficiencies and growth. For
example, Maggiano's delivery partnership with DoorDash makes third party
delivery more sustainable and efficient for the brand to operate. In addition to
the DoorDash platform, our guests have the ability to order delivery directly
through the Maggiano's website. During the pandemic, Maggiano's has leveraged
off-premise dining options, including It's Just Wings, to sustain revenues.
Maggiano's historically hosts a significant portion of its banquets in the
holiday season during the second and third quarters of the fiscal year.
Virtual Brands - We are investing in virtual brands, restaurant-like menu
offerings that are only available for purchase digitally, to drive restaurant
traffic and sales growth. We expect that our virtual brands will enable us to
capitalize on the growth in off-premise dining and to leverage excess kitchen
capacity in our existing restaurant infrastructure, while adding minimal
complexity in our restaurants' kitchens.
It's Just Wings, launched on June 23, 2020, is a no-frills offering that
consists of chicken wings available in a variety of different sauces and rubs,
curly fries, ranch dressing, fried Oreos and hand pies for a value price.
Maggiano's Italian Classics offers a select group of items from the full menu of
Maggiano's Little Italy including several appetizers, salads, pastas, entrées,
mac & cheese and hand pies.
They are available for purchase through DoorDash, Google Food Ordering and their
respective websites - itsjustwings.com and maggianosclassics.com. The operating
results for the virtual brands are included in the results of our Chili's and
Maggiano's brands, based on the restaurants that prepared and processed the food
orders. We plan to continue to test and strategically launch additional virtual
brands in the future to further drive our growth.
Franchise Partnerships - Our franchisees continue to grow our brands around the
world, opening three restaurants and entering into one new development agreement
for the thirteen week period ended September 29, 2021. We plan to strategically
pursue expansion of Chili's internationally through development agreements with
new and existing franchise partners. We are also supporting our franchise
partners with opportunities to expand sales through our virtual brand offerings.

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Company Development - The following table details the number of restaurant
openings during the thirteen week periods ended September 29, 2021 and September
23, 2020, respectively, total full year projected openings in fiscal 2022, and
the total restaurants open at each period end:
                                                                Openings During the                        Full Year
                                                               Thirteen Week Periods Ended             Projected Openings                  Total Open Restaurants at
                                                                                  September 29,
                                                                                       2021            September 23, 2020         Fiscal 2022          
     September 29, 2021         September 23, 2020
Company-owned restaurants
Chili's domestic                                                                            1                      3                     8                         1,088                      1,059
Chili's international                                                                       -                      -                     -                             5                          5
Maggiano's domestic                                                                         -                      -                     -                            52                         52
Total Company-owned                                                                         1                      3                     8                         1,145                      1,116
Franchise restaurants
Chili's domestic                                                                            -                      1                     3                           146                        172
Chili's international                                                                       3                      3                       9-12                      357                        371
Maggiano's domestic                                                                         -                      -                     -                             2                          1
Total franchise                                                                             3                      4                      12-15                      505                        544
Total restaurants
Chili's domestic                                                                            1                      4                    11                         1,234                      1,231
Chili's international                                                                       3                      3                       9-12                      362                        376
Maggiano's domestic                                                                         -                      -                     -                            54                         53
Total                                                                                       4                      7                      20-23                    1,650                      1,660


During the thirteen week period ended September 29, 2021, we acquired 23 Chili's
restaurants located in the Mid-Atlantic region of the United States owned by a
franchisee. The acquisition of these restaurants is not reflected in Openings
during the thirteen week period ended September 29, 2021 or Full Year Projected
Openings total as they are existing restaurant locations transitioning
ownership. These acquired restaurants are included in Total Open Restaurants at
September 29, 2021 within the total for Company-owned restaurants Chili's
domestic.
At September 29, 2021, we own property for 46 of the 1,145 Company-owned
restaurants. The net book values associated with these restaurants included land
of $38.3 million and buildings of $13.2 million.
Revenues
Thirteen Week Period Ended September 29, 2021 compared to September 23, 2020
Revenues are presented in two separate captions in the Consolidated Statements
of Comprehensive Income (Unaudited) to provide more clarity around Company-owned
restaurant revenues and operating expenses trends:
•Company sales include revenues generated by the operation of Company-owned
restaurants including gift card redemptions and revenues from our It's Just
Wings and Maggiano's Italian Classics virtual brands.
•Franchise and other revenues include royalties, delivery fee income, gift card
breakage, Maggiano's banquet service charge income, digital entertainment
revenue, franchise advertising fees, franchise and development fees, gift card
equalization, merchandise income and gift card discount costs from third-party
gift card sales.

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The following is a summary of the change in Total revenues:
                                                                Total 

Revenues

                                                 Chili's      Maggiano's       Total Revenues
Thirteen Week Period Ended September 23, 2020   $ 686.5$      53.6$        740.1
Change from:
Comparable restaurant sales                        87.7             33.1               120.8
Restaurant openings                                 5.4                -                 5.4
Restaurant acquisitions(1)                          4.1                -                 4.1
Restaurant closures(2)                              0.6                -                 0.6
Restaurant relocations                              0.5                -                 0.5

Company sales                                      98.3             33.1               131.4
Royalties(3)                                        2.4              0.1                 2.5
Franchise fees and other revenues                   0.4              2.0                 2.4
Franchise and other revenues                        2.8              2.1                 4.9

Thirteen Week Period Ended September 29, 2021$ 787.6$ 88.8

$ 876.4



(1)We acquired 23 Chili's restaurants from a franchisee on September 2, 2021.
The revenues generated by these restaurants since the date of the acquisition
are included in Company sales for the thirteen week period ended September 29,
2021.
(2)Restaurant closures include the change in Company sales resulting from
temporary closures longer than 14 consecutive days that occurred in the previous
18 months, partially offset by permanently closed locations.
(3)Our franchisees generated sales of approximately $211.9 million for the
thirteen week period ended September 29, 2021 compared to $163.5 million in
sales for the thirteen week period ended September 23, 2020.
The table below presents the percentage change in comparable restaurant sales
and restaurant capacity for the thirteen week period ended September 29, 2021
compared to September 23, 2020:
                                                Percentage Change in the 

Thirteen Week Period Ended September 29, 2021 versus September 23, 2020

                                 Comparable Restaurant
                                       Sales(1)                Price Impact          Mix-Shift Impact(2)          Traffic Impact         Restaurant Capacity(3)
Company-owned                                  17.0  %                  0.6  %                     5.6  %                  10.8  %                       2.1  %
Chili's                                        13.4  %                  0.6  %                     3.4  %                   9.4  %                       2.2  %
Maggiano's                                     62.6  %                  0.2  %                    23.3  %                  39.1  %                       0.0  %
Chili's Franchise(4)                           23.1  %
U.S.                                           17.8  %
International                                  32.0  %
Chili's Domestic(5)                            13.8  %
System-wide(6)                                 17.8  %


(1)Comparable Restaurant Sales include all restaurants that have been in
operation for more than 18 months except acquired restaurants which are included
after 12 months of ownership. Restaurants temporarily closed 14 days or more are
excluded from Comparable Restaurant Sales. Percentage amounts are calculated
based on the comparable periods year-over-year.
(2)Mix-Shift is calculated as the year-over-year percentage change in Company
sales resulting from the change in menu items ordered by guests.
(3)Restaurant Capacity is measured by sales weeks and is calculated based on
comparable periods year-over-year, including the effect of the acquisition of 23
Chili's restaurants in the first quarter of fiscal 2022.

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(4)Chili's franchise sales generated by franchisees are not included in Total
revenues in the Consolidated Statements of Comprehensive Income (Unaudited);
however, we generate royalty revenues and advertising fees based on franchisee
revenues, where applicable. We believe presenting Chili's franchise comparable
restaurant sales provides investors relevant information regarding total brand
performance.
(5)Chili's domestic Comparable Restaurant Sales percentages are derived from
sales generated by Company-owned and franchise-operated Chili's restaurants in
the United States.
(6)System-wide Comparable Restaurant Sales are derived from sales generated by
Company-owned Chili's and Maggiano's restaurants and sales generated at
franchise-operated Chili's restaurants.
Costs and Expenses
Thirteen Week Period Ended September 29, 2021 compared to September 23, 2020
The following is a summary of the changes in Costs and Expenses:
                                                           Thirteen Week 

Periods Ended

                                          September 29, 2021                           September 23, 2020                    Favorable (Unfavorable) Variance
                                                         % of Company                               % of Company                                   % of Company
                                    Dollars                 Sales                Dollars               Sales                  Dollars                 Sales
Food and beverage costs         $       234.3                   27.2  %       $    193.5                   26.6  %       $        (40.8)                  (0.6) %
Restaurant labor                        304.9                   35.5  %            248.0                   34.0  %                (56.9)                  (1.5) %
Restaurant expenses                     231.3                   26.9  %            202.5                   27.8  %                (28.8)                   0.9  %
Depreciation and amortization            39.3                                       37.4                                           (1.9)
General and administrative               36.5                                       30.5                                           (6.0)
Other (gains) and charges                 4.5                                        3.8                                           (0.7)
Interest expenses                        12.5                                       14.6                                            2.1
Other income, net                        (0.3)                                      (0.4)                                          (0.1)


As a percentage of Company sales:
•Food and beverage costs increased 0.6%, including 1.0% of unfavorable commodity
pricing due to supply chain constraints and inflationary pressures resulting in
higher poultry and other commodity costs, partially offset by 0.2% of favorable
menu pricing and 0.2% of favorable menu item mix.
•Restaurant labor increased 1.5%, including 4.0% of higher restaurant labor
costs primarily including wage rates, training and overtime and 0.3% of higher
other labor expenses, partially offset by 2.8% of sales leverage.
•Restaurant expenses decreased 0.9%, including 3.2% of sales leverage and 0.8%
of lower delivery fees and To-Go supplies, partially offset by 1.4% of higher
repairs and maintenance expenses, 0.6% of higher utilities expenses, 0.3% of
higher advertising expenses, 0.3% of higher restaurant supplies and 0.5% of
higher other restaurant expenses.

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Depreciation and amortization increased $1.9 million as follows:
                                                                            

Depreciation and

Amortization

Thirteen Week Period Ended September 23, 2020                                  $          37.4
Change from:
Retirements and fully depreciated restaurant assets                                       (4.1)
Finance leases                                                                             1.5
Additions for existing and new restaurant assets                                           3.9
Acquisition of Chili's restaurants(1)                                                      0.2
Corporate assets                                                                           0.4

Thirteen Week Period Ended September 29, 2021

$ 39.3

(1)Represents the incremental depreciation and amortization of the assets and finance leases of the 23 Chili's restaurants acquired on September 2, 2021. General and administrative expenses increased $6.0 million as follows:

                                                  General and 

Administrative

Thirteen Week Period Ended September 23, 2020    $                      

30.5

Change from:
Defined contribution plan employer expenses(1)                           2.9
Professional fees                                                        1.5
Payroll-related expenses                                                 1.0
Travel and entertainment expenses                                        

0.4

Stock-based compensation                                                 

0.2

Performance-based compensation                                          

(1.0)

Other                                                                    

1.0

Thirteen Week Period Ended September 29, 2021    $                      

36.5



(1)Defined contribution plan employer expenses increased due to the temporary
suspension of employer matching contributions related to the Company's 401(k)
plan from May 2020 through December 2020. Employer matching contributions were
reinstated beginning January 1, 2021.
Other (gains) and charges consisted of the following (for further details, refer
to Note 4 - Other Gains and Charges):
                                                                          

Thirteen Week Periods Ended

                                                                     September 29,           September 23,
                                                                         2021                    2020
Remodel-related costs                                              $          1.5          $          0.2
Enterprise system implementation                                              0.6                       -
Loss from natural disasters, net of (insurance recoveries)                    0.6                       -
COVID-19 related charges                                                      0.3                     1.2
Restaurant closure charges                                                    0.2                     1.5
Other                                                                         1.3                     0.9
                                                                   $          4.5          $          3.8

Interest expenses decreased $2.1 million due to lower interest rates and average borrowing balances on our revolving credit facility in fiscal 2022.

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Income Taxes
                                                                Thirteen Week Periods Ended
                                                                              September 29,                 September 23,                  Favorable /
                                                                                  2021                          2020                 (Unfavorable) Variance
Effective income tax rate                                                                 1.5  %                       (4.9) %                       (6.4) %


The federal statutory tax rate was 21.0% for the thirteen week periods ended
September 29, 2021 and September 23, 2020.
The effective income tax rate in the thirteen week period ended September 29,
2021 increased compared to the thirteen week period ended September 23, 2020
primarily due to a reduced favorable impact from the FICA tip tax credit and the
excess tax benefits associated with stock-based compensation in the first
quarter of fiscal 2022.
Segment Results
Chili's Segment
Thirteen Week Period Ended September 29, 2021 compared to September 23, 2020

                                               Thirteen Week Periods Ended                   Favorable
                                          September 29,           September 23,            (Unfavorable)               Variance as
                                              2021                    2020                    Variance                  percentage
Company sales                           $        773.3$        675.0          $            98.3                       14.6  %
Royalties                                          9.0                     6.6                        2.4                       36.4  %
Franchise fees and other revenues                  5.3                     4.9                        0.4                        8.2  %
Franchise and other revenues                      14.3                    11.5                        2.8                       24.3  %
Total revenues                          $        787.6$        686.5          $           101.1                       14.7  %


Chili's Total revenues increased 14.7% primarily due to higher dining room guest
sales and traffic, six restaurant openings and the acquisition of 23 Chili's
restaurants on September 2, 2021, partially offset by decreased off-premise
sales. Refer to "Revenues" section above for further details about Chili's
revenues changes.
The following is a summary of the changes in Chili's operating costs and
expenses:
                                                           Thirteen Week 

Periods Ended

                                          September 29, 2021                           September 23, 2020                    Favorable (Unfavorable) Variance
                                                         % of Company                               % of Company                                   % of Company
                                    Dollars                 Sales                Dollars               Sales                  Dollars                 Sales
Food and beverage costs         $       213.4                   27.6  %       $    180.8                   26.8  %       $        (32.6)                  (0.8) %
Restaurant labor                        273.5                   35.3  %            228.2                   33.8  %                (45.3)                  (1.5) %
Restaurant expenses                     204.6                   26.5  %            181.4                   26.9  %                (23.2)                   0.4  %
Depreciation and amortization            33.0                                       30.6                                           (2.4)
General and administrative                8.0                                        5.4                                           (2.6)
Other (gains) and charges                 2.8                                        3.6                                            0.8


As a percentage of Company sales:
•Chili's Food and beverage costs increased 0.8%, including 0.9% of unfavorable
commodity pricing due to supply chain constraints and inflationary pressures
resulting in higher poultry and other commodity costs and 0.1% of unfavorable
menu item mix, partially offset by 0.2% of increased menu pricing.
•Chili's Restaurant labor increased 1.5%, including 3.6% of higher restaurant
labor costs primarily including wage rates, training and overtime and 0.2% of
higher other labor expenses, partially offset by 2.3% of sales leverage.

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•Chili's Restaurant expenses decreased 0.4%, including 2.5% of sales leverage
and 0.6% of lower delivery fees and To-Go supplies, partially offset by 1.3% of
higher repairs and maintenance expenses, 0.6% of higher utilities expenses and
0.8% of higher other restaurant expenses.
Chili's Depreciation and amortization increased $2.4 million as follows:
                                                                            

Depreciation and

Amortization

Thirteen Week Period Ended September 23, 2020                                  $          30.6
Change from:
Additions for existing and new restaurant assets                                           3.8
Finance leases                                                                             1.4
Acquisition of Chili's restaurants(1)                                                      0.2
Retirements and fully depreciated restaurant assets                                       (3.0)

Thirteen Week Period Ended September 29, 2021

$ 33.0

(1)Represents the incremental depreciation and amortization of the assets and finance leases of the 23 Chili's restaurants acquired on September 2, 2021. Chili's General and administrative increased $2.6 million as follows:

                                                  General and 

Administrative

Thirteen Week Period Ended September 23, 2020    $                       

5.4

Change from:
Defined contribution plan employer expenses(1)                           2.1
Professional fees                                                        0.3
Stock-based compensation                                                 0.3
Travel and entertainment expenses                                        

0.1


Performance-based compensation                                          

(0.3)

Other                                                                    

0.1

Thirteen Week Period Ended September 29, 2021    $                       

8.0



(1)Defined contribution plan employer expenses increased due to the temporary
suspension of employer matching contributions related to the Company's 401(k)
plan from May 2020 through December 2020. Employer matching contributions were
reinstated beginning January 1, 2021.
Maggiano's Segment
Thirteen Week Period Ended September 29, 2021 compared to September 23, 2020

                                               Thirteen Week Periods Ended                    Favorable
                                          September 29,            September 23,            (Unfavorable)              Variance as a
                                               2021                    2020                    Variance                  percentage
Company sales                           $          86.3          $         53.2          $            33.1                       62.2  %
Royalties                                           0.1                     0.0                        0.1                      100.0  %
Franchise fees and other revenues                   2.4                     0.4                        2.0                      500.0  %
Franchise and other revenues                        2.5                     0.4                        2.1                      525.0  %
Total revenues                          $          88.8          $         53.6          $            35.2                       65.7  %


Maggiano's Total revenues increased 65.7% primarily due to higher dining and
banquet room sales and traffic, and higher delivery sales, including virtual
brands, partially offset by a decrease in To-Go sales. Refer to "Revenues"
section above for further details about Maggiano's revenues changes.

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Table of Contents The following is a summary of the changes in Maggiano's operating costs and expenses:

                                                           Thirteen Week 

Periods Ended

                                          September 29, 2021                          September 23, 2020                    Favorable (Unfavorable) Variance
                                                        % of Company                               % of Company                                    % of Company
                                    Dollars                Sales                Dollars               Sales                  Dollars                  Sales
Food and beverage costs         $       20.9                   24.2  %       $     12.7                   23.9  %       $          (8.2)                  (0.3) %
Restaurant labor                        31.4                   36.4  %             19.8                   37.2  %                 (11.6)                   0.8  %
Restaurant expenses                     26.6                   30.8  %             20.8                   39.1  %                  (5.8)                   8.3  %
Depreciation and amortization            3.4                                        3.6                                             0.2
General and administrative               2.0                                        1.3                                            (0.7)
Other (gains) and charges                0.2                                        0.1                                            (0.1)


As a percentage of Company sales:
•Maggiano's Food and beverage costs increased 0.3%, including 0.6% of
unfavorable commodity pricing due to supply chain constraints and inflationary
pressures resulting in higher seafood and other commodity costs, partially
offset by 0.3% of favorable menu item mix.
•Maggiano's Restaurant labor decreased 0.8%, including 9.0% of sales leverage,
partially offset by 7.0% of higher restaurant labor costs primarily including
wage rates, training and overtime, 1.1% of higher manager bonus expenses and
0.1% of higher other labor expenses.
•Maggiano's Restaurant expenses decreased 8.3%, including 12.5% of sales
leverage and 0.9% lower delivery fees and To-Go supplies, partially offset by
2.2% of higher repairs and maintenance expenses, 1.4% of higher advertising
expenses, 1.4% of higher supervision expenses and 0.1% of higher other
restaurant expenses.
Liquidity and Capital Resources
COVID-19 Impact on Liquidity
Cash flows generated from operating activities are our principal source of
liquidity, which we use to finance capital expenditures, such as remodels,
maintaining existing restaurants and constructing new restaurants, to pay
dividends and to repurchase shares of our common stock when authorized. Our
strategic decision to enhance our off-premise business has enabled us to
conveniently serve a significantly higher volume of off-premise guests during
this pandemic compared to other industry competitors.
At the outset of the COVID-19 pandemic in fiscal 2020 and into early fiscal
2021, we took proactive precautionary measures to preserve liquidity, reduce
costs and pause non-critical projects that did not significantly impact our
current operations. In the second half of fiscal 2021, our operational results
and liquidity returned to pre-pandemic levels. Beginning in the first quarter of
fiscal 2022, we took or plan to take the following actions:
•Revised our revolving credit facility during the first quarter of fiscal 2022
to extend the maturity date and provide additional flexibility;
•Resumed the Chili's and Maggiano's remodel program and construction of new
restaurants;
•Selectively increased marketing and restaurant expenses
•Reinstated the share repurchase program; and
•Will repay $54.5 million of payroll taxes deferred in accordance with the CARES
Act in two equal installments on December 31, 2021 and December 31, 2022.

                                       29

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Table of Contents

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01/18Wedbush Cuts Brinker International to Neutral From Outperform, Price Target to $42 From..
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01/18NORTH AMERICAN MORNING BRIEFING : Bond Yields Hit -3-
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01/14Morgan Stanley Cuts Price Target on Brinker International to $43 From $47, Maintains Eq..
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