Leases (Tables)

3 Months Ended

Mar. 31, 2019

The components of lease cost are as follows:



	Three Months Ended
	March 31, 2019
Finance lease cost:
Amortization of finance lease assets	$	3,117
Interest on finance lease liabilities	6,753
	9,870
Operating lease cost	24,643
Variable lease cost (a)	14,104
Short-term lease cost	1,126
Total operating lease cost (b)	39,873
Total lease cost	$	49,743

_______________


(a)	Includes expenses for executory costs of $9,524, for which the Company is reimbursed by sublessees.


(b)	Includes $32,451 recorded to “Franchise rental expense” for leased properties that are subsequently leased to franchisees and $6,593 recorded to “Cost of sales” for leases for Company-operated restaurants.

Schedule of Supplemental Cash Flow and Non-cash Information Related to Leases

The following table includes supplemental cash flow and non-cash information related to leases:



	Three Months Ended
	March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	9,708
Operating cash flows from operating leases	23,312
Financing cash flows from finance leases	1,881
Right-of-use assets obtained in exchange for lease obligations:
Finance lease liabilities	13,810
Operating lease liabilities	3,255

Schedule of Supplemental Information Related to Leases

The following table includes supplemental information related to leases:



	March 31, 2019
Weighted-average remaining lease term (years):
Finance leases	17.8
Operating leases	15.9

Weighted average discount rate:
Finance leases	10.19	%
Operating leases	5.10	%

Finance Lease, Liability, Maturity

The following table illustrates the Company’s future minimum rental payments for non-cancelable leases as of March 31, 2019:



	Finance Leases						Operating Leases
Fiscal Year	Company- Operated			Franchise and Other			Company- Operated			Franchise and Other
2019 (a)	$	1,917		$	34,251		$	15,168		$	54,760
2020	2,577			44,313			20,022			73,121
2021	2,687			45,706			19,764			73,067
2022	2,738			46,724			19,398			73,330
2023	2,690			48,389			19,376			73,407
Thereafter	34,441			688,400			200,962			853,051
Total minimum payments	$	47,050		$	907,783		$	294,690		$	1,200,736
Less interest	(22,400		)	(464,458		)	(93,278		)	(400,752		)
Present value of minimum lease payments (b) (c)	$	24,650		$	443,325		$	201,412		$	799,984

_______________


(a)	Represents future minimum rental payments for non-cancelable leases for the remainder of 2019.


(b)	The present value of minimum finance lease payments of $9,380 and $458,595 are included in “Current portion of finance lease liabilities” and “Long-term finance lease liabilities,” respectively.


(c)	The present value of minimum operating lease payments of $43,657 and $957,739 are included in “Current portion of operating lease liabilities” and “Long-term operating lease liabilities,” respectively.

The following table illustrates the Company’s future minimum rental payments for non-cancelable leases as of December 30, 2018:



	Finance Leases						Operating Leases
Fiscal Year	Company- Operated			Franchise and Other			Company- Operated		Franchise and Other
2019	$	1,962		$	45,125		$	20,174	$	75,703
2020	1,978			43,969			20,052		73,320
2021	2,082			45,522			19,820		73,167
2022	2,114			46,573			19,530		73,300
2023	2,084			48,109			19,430		73,377
Thereafter	23,558			676,139			203,073		854,964
Total minimum payments	$	33,778		$	905,437		$	302,079	$	1,223,831
Less interest	(16,874		)	(466,705		)
Present value of minimum lease payments (a)	$	16,904		$	438,732

_______________


(a)	The present value of minimum finance lease payments of $8,405 and $447,231 are included in “Current portion of finance lease liabilities” and “Long-term finance lease liabilities,” respectively.

Lessee, Operating Lease, Liability, Maturity

The following table illustrates the Company’s future minimum rental payments for non-cancelable leases as of March 31, 2019:



	Finance Leases						Operating Leases
Fiscal Year	Company- Operated			Franchise and Other			Company- Operated			Franchise and Other
2019 (a)	$	1,917		$	34,251		$	15,168		$	54,760
2020	2,577			44,313			20,022			73,121
2021	2,687			45,706			19,764			73,067
2022	2,738			46,724			19,398			73,330
2023	2,690			48,389			19,376			73,407
Thereafter	34,441			688,400			200,962			853,051
Total minimum payments	$	47,050		$	907,783		$	294,690		$	1,200,736
Less interest	(22,400		)	(464,458		)	(93,278		)	(400,752		)
Present value of minimum lease payments (b) (c)	$	24,650		$	443,325		$	201,412		$	799,984

_______________


(a)	Represents future minimum rental payments for non-cancelable leases for the remainder of 2019.


(b)	The present value of minimum finance lease payments of $9,380 and $458,595 are included in “Current portion of finance lease liabilities” and “Long-term finance lease liabilities,” respectively.


(c)	The present value of minimum operating lease payments of $43,657 and $957,739 are included in “Current portion of operating lease liabilities” and “Long-term operating lease liabilities,” respectively.

The following table illustrates the Company’s future minimum rental payments for non-cancelable leases as of December 30, 2018:



	Finance Leases						Operating Leases
Fiscal Year	Company- Operated			Franchise and Other			Company- Operated		Franchise and Other
2019	$	1,962		$	45,125		$	20,174	$	75,703
2020	1,978			43,969			20,052		73,320
2021	2,082			45,522			19,820		73,167
2022	2,114			46,573			19,530		73,300
2023	2,084			48,109			19,430		73,377
Thereafter	23,558			676,139			203,073		854,964
Total minimum payments	$	33,778		$	905,437		$	302,079	$	1,223,831
Less interest	(16,874		)	(466,705		)
Present value of minimum lease payments (a)	$	16,904		$	438,732

_______________


(a)	The present value of minimum finance lease payments of $8,405 and $447,231 are included in “Current portion of finance lease liabilities” and “Long-term finance lease liabilities,” respectively.

Sales-type Lease, Lease Income

The components of lease income are as follows:



	Three Months Ended
	March 31, 2019
Sales-type and direct-financing leases:
Selling profit	$	1,934
Interest income	4,733

Operating lease income	$	45,205
Variable lease income	13,247
Franchise rental income (a)	$	58,452

_______________


(a)	Includes sublease income of $43,021 recognized during the three months ended March 31, 2019, of which $9,432 represents lessees’ variable payments to the Company for executory costs.

Direct Financing Lease, Lease Income

The components of lease income are as follows:



	Three Months Ended
	March 31, 2019
Sales-type and direct-financing leases:
Selling profit	$	1,934
Interest income	4,733

Operating lease income	$	45,205
Variable lease income	13,247
Franchise rental income (a)	$	58,452

_______________


(a)	Includes sublease income of $43,021 recognized during the three months ended March 31, 2019, of which $9,432 represents lessees’ variable payments to the Company for executory costs.

Operating Lease, Lease Income

The components of lease income are as follows:



	Three Months Ended
	March 31, 2019
Sales-type and direct-financing leases:
Selling profit	$	1,934
Interest income	4,733

Operating lease income	$	45,205
Variable lease income	13,247
Franchise rental income (a)	$	58,452

_______________


(a)	Includes sublease income of $43,021 recognized during the three months ended March 31, 2019, of which $9,432 represents lessees’ variable payments to the Company for executory costs.

Sales-type and Direct Financing Leases, Lease Receivable, Maturity

The following table illustrates the Company’s future minimum rental receipts for non-cancelable leases and subleases as of March 31, 2019:



	Sales-Type and Direct Financing Leases						Operating Leases
Fiscal Year	Subleases			Owned Properties			Subleases		Owned Properties
2019 (a)	$	20,182		$	1,543		$	84,371	$	39,451
2020	27,484			2,130			113,275		52,990
2021	28,522			2,162			114,167		54,561
2022	29,159			2,243			115,363		56,034
2023	30,193			2,287			116,342		56,239
Thereafter	466,197			28,031			1,367,503		859,548
Total future minimum receipts	601,737			38,396			$	1,911,021	$	1,118,823
Unearned interest income	(380,607		)	(20,831		)
Net investment in sales-type and direct financing leases (b)	$	221,130		$	17,565

_______________


(a)	Represents future minimum rental receipts for non-cancelable leases for the remainder of 2019.


(b)	The present value of minimum direct financing rental receipts of $2,269 and $236,426 are included in “Accounts and notes receivable, net” and “Net investment in sales-type and direct financing leases,” respectively. The present value of minimum direct financing rental receipts includes a net investment in unguaranteed residual assets of $233.

The following table illustrates the Company’s future minimum rental receipts for non-cancelable leases and subleases as of December 30, 2018:



	Sales-Type and Direct Financing Leases						Operating Leases
Fiscal Year	Subleases			Owned Properties			Subleases		Owned Properties
2019	$	26,239		$	1,937		$	113,180	$	52,527
2020	26,859			2,006			113,578		53,066
2021	27,904			2,043			114,447		54,615
2022	28,563			2,119			115,552		56,092
2023	29,512			2,159			116,463		56,284
Thereafter	448,851			26,404			1,372,646		858,755
Total future minimum receipts	587,928			36,668			$	1,945,866	$	1,131,339
Unearned interest income	(377,046		)	(20,338		)
Net investment in sales-type and direct financing leases (a)	$	210,882		$	16,330

_______________


(a)	The present value of minimum direct financing rental receipts of $735 and $226,477 are included in “Accounts and notes receivable, net” and “Net investment in sales-type and direct financing leases,” respectively.

Lessor, Operating Lease, Payments to be Received, Maturity

The following table illustrates the Company’s future minimum rental receipts for non-cancelable leases and subleases as of March 31, 2019:



	Sales-Type and Direct Financing Leases						Operating Leases
Fiscal Year	Subleases			Owned Properties			Subleases		Owned Properties
2019 (a)	$	20,182		$	1,543		$	84,371	$	39,451
2020	27,484			2,130			113,275		52,990
2021	28,522			2,162			114,167		54,561
2022	29,159			2,243			115,363		56,034
2023	30,193			2,287			116,342		56,239
Thereafter	466,197			28,031			1,367,503		859,548
Total future minimum receipts	601,737			38,396			$	1,911,021	$	1,118,823
Unearned interest income	(380,607		)	(20,831		)
Net investment in sales-type and direct financing leases (b)	$	221,130		$	17,565

_______________


(a)	Represents future minimum rental receipts for non-cancelable leases for the remainder of 2019.


(b)	The present value of minimum direct financing rental receipts of $2,269 and $236,426 are included in “Accounts and notes receivable, net” and “Net investment in sales-type and direct financing leases,” respectively. The present value of minimum direct financing rental receipts includes a net investment in unguaranteed residual assets of $233.

The following table illustrates the Company’s future minimum rental receipts for non-cancelable leases and subleases as of December 30, 2018:



	Sales-Type and Direct Financing Leases						Operating Leases
Fiscal Year	Subleases			Owned Properties			Subleases		Owned Properties
2019	$	26,239		$	1,937		$	113,180	$	52,527
2020	26,859			2,006			113,578		53,066
2021	27,904			2,043			114,447		54,615
2022	28,563			2,119			115,552		56,092
2023	29,512			2,159			116,463		56,284
Thereafter	448,851			26,404			1,372,646		858,755
Total future minimum receipts	587,928			36,668			$	1,945,866	$	1,131,339
Unearned interest income	(377,046		)	(20,338		)
Net investment in sales-type and direct financing leases (a)	$	210,882		$	16,330

_______________


(a)	The present value of minimum direct financing rental receipts of $735 and $226,477 are included in “Accounts and notes receivable, net” and “Net investment in sales-type and direct financing leases,” respectively.

Schedule of Property Subject To Operating Lease

Properties owned by the Company and leased to franchisees and other third parties under operating leases include:



	March 31, 2019
Land	$	281,571
Buildings and improvements	310,912
Restaurant equipment	2,120
	594,603
Accumulated depreciation and amortization	(145,812		)
	$	448,791