Note P – Supplemental Condensed Consolidating Financial Statements

6 Months Ended

Dec. 02, 2014

Disclosure Text Block Supplement [Abstract]

Condensed Financial Statements [Text Block]

NOTE P – SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

As discussed in Note H to the Condensed Consolidated Financial Statements, the Senior Notes held by Ruby Tuesday, Inc. (the “Parent”) are guaranteed on a senior unsecured basis by our existing and future domestic restricted subsidiaries, subject to certain exceptions (the “Guarantors”). Each of the Guarantors is wholly-owned by Ruby Tuesday, Inc. None of the few remaining subsidiaries of Ruby Tuesday, Inc., which were primarily created to hold liquor license assets, guarantee the Senior Notes (the “Non-Guarantors”). Our Non-Guarantor subsidiaries are immaterial and are aggregated within the Parent information disclosed below.

The following condensed consolidating financial information, which has been prepared in accordance with the requirements for presentation of Rule 3-10(f) of Regulation S-X promulgated by the Securities and Exchange Commission, presents the condensed consolidating financial information separately for the Parent, the Guarantors, and elimination entries necessary to consolidate the Parent and Guarantors. Investments in wholly-owned subsidiaries are accounted for using the equity method for purposes of the consolidated presentation. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.

Condensed Consolidating Balance Sheet

As of December 2, 2014

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	47,866		$	304		$	-		$	48,170
Accounts receivable		2,088			3,543			-			5,631
Inventories		18,762			7,958			-			26,720
Income tax receivable		143,164			-			(139,990	)		3,174
Other current assets		16,694			3,040			-			19,734
Total current assets		228,574			14,845			(139,990	)		103,429
Property and equipment, net		570,506			201,320			-			771,826
Investment in subsidiaries		134,430			-			(134,430	)		-
Due from/(to) subsidiaries		79,676			220,055			(299,731	)		-
Other assets		47,471			11,989			-			59,460
Total assets	$	1,060,657		$	448,209		$	(574,151	)	$	934,715
Liabilities & Shareholders’ Equity
Current liabilities:
Accounts payable	$	21,339		$	5,626		$	-		$	26,965
Accrued and other current liabilities		43,125			34,346			-			77,471
Current maturities of long-term debt, including capital leases		(354	)		4,860			-			4,506
Deferred income taxes		3,062			(3,004	)		-			58
Income tax payable		-			139,990			(139,990	)		-
Total current liabilities		67,172			181,818			(139,990	)		109,000
Long-term debt and capital leases, less current maturities		213,204			34,711			-			247,915
Deferred income taxes		(1,867	)		4,091			-			2,224
Due to/(from) subsidiaries		220,055			79,676			(299,731	)		-
Other deferred liabilities		102,762			13,483			-			116,245
Total liabilities		601,326			313,779			(439,721	)		475,384
Shareholders’ equity:
Common stock		621			-			-			621
Capital in excess of par value		80,165			-			-			80,165
Retained earnings		388,518			134,430			(134,430	)		388,518
Accumulated other comprehensive loss		(9,973	)		-			-			(9,973	)
Total shareholders’ equity		459,331			134,430			(134,430	)		459,331
Total liabilities & shareholders’ equity	$	1,060,657		$	448,209		$	(574,151	)	$	934,715

Condensed Consolidating Balance Sheet

As of June 3, 2014

(In thousands)

	Parent			Guarantors		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	51,012		$	314	$	-		$	51,326
Accounts receivable		1,725			3,136		-			4,861
Inventories		15,114			6,060		-			21,174
Income tax receivable		138,524			-		(136,391	)		2,133
Deferred income taxes		(548	)		3,945		-			3,397
Other current assets		14,610			2,289		-			16,899
Total current assets		220,437			15,744		(136,391	)		99,790
Property and equipment, net		587,783			207,063		-			794,846
Investment in subsidiaries		158,266			-		(158,266	)		-
Due from/(to) subsidiaries		78,612			243,665		(322,277	)		-
Other assets		48,780			13,011		-			61,791
Total assets	$	1,093,878		$	479,483	$	(616,934	)	$	956,427
Liabilities & Shareholders’ Equity
Current liabilities:
Accounts payable	$	20,545		$	5,656	$	-		$	26,201
Accrued and other current liabilities		46,450			36,356		-			82,806
Current maturities of long-term debt, including capital leases		(341	)		5,157					4,816
Income tax payable		-			136,391		(136,391	)		-
Total current liabilities		66,654			183,560		(136,391	)		113,823
Long-term debt and capital leases, less current maturities		213,039			40,836		-			253,875
Deferred income taxes		(445	)		3,945		-			3,500
Due to/(from) subsidiaries		243,665			78,612		(322,277	)		-
Other deferred liabilities		109,756			14,264		-			124,020
Total liabilities		632,669			321,217		(458,668	)		495,218
Shareholders’ equity:
Common stock		614			-		-			614
Capital in excess of par value		76,269			-		-			76,269
Retained earnings		395,226			158,266		(158,266	)		395,226
Accumulated other comprehensive loss		(10,900	)		-		-			(10,900	)
Total shareholders’ equity		461,209			158,266		(158,266	)		461,209
Total liabilities & shareholders’ equity	$	1,093,878		$	479,483	$	(616,934		$	956,427

Condensed Consolidating Statement of Operations and

Comprehensive Loss

For the Thirteen Weeks Ended December 2, 2014

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	188,572		$	72,634		$	-		$	261,206
Franchise revenue		38			1,415			-			1,453
		188,610			74,049			-			262,659
Operating costs and expenses:
Cost of goods sold		51,718			19,928			-			71,646
Payroll and related costs		66,348			27,616			-			93,964
Other restaurant operating costs		43,496			16,601			-			60,097
Depreciation		9,344			3,194			-			12,538
Selling, general, and administrative		16,548			10,744			-			27,292
Intercompany selling, general, and administrative allocations		10,473			(10,473	)		-			-
Closures and impairments		1,073			2			-			1,075
Equity in earnings of subsidiaries		(4,326	)		-			4,326			-
Interest expense, net		4,736			1,179			-			5,915
Intercompany interest expense/(income)		2,998			(2,998	)		-			-
		202,408			65,793			4,326			272,527
(Loss)/income before income taxes		(13,798	)		8,256			(4,326	)		(9,868	)
(Benefit)/provision for income taxes		(4,525	)		3,930			-			(595	)
Net loss	$	(9,273	)	$	4,326		$	(4,326	)	$	(9,273	)
Other comprehensive loss:
Pension liability reclassification, net of tax		464			-			-			464
Total comprehensive loss	$	(8,809	)	$	4,326		$	(4,326	)	$	(8,809	)

	Parent			Guarantor			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	391,123		$	149,540		$	-		$	540,663
Franchise revenue		184			2,994			-			3,178
		391,307			152,534			-			543,841
Operating costs and expenses:
Cost of goods sold		106,248			40,545			-			146,793
Payroll and related costs		134,390			55,416			-			189,806
Other restaurant operating costs		86,908			32,988			-			119,896
Depreciation		18,731			6,465			-			25,196
Selling, general, and administrative		36,769			21,424			-			58,193
Intercompany selling, general, and administrative allocations		21,615			(21,615	)		-			-
Closures and impairments		2,304			253			-			2,557
Equity in earnings of subsidiaries		(12,107	)		-			12,107			-
Interest expense, net		9,247			2,090			-			11,337
Intercompany interest expense/(income)		5,890			(5,890	)		-			-
		409,995			131,676			12,107			553,778
(Loss)/income before income taxes		(18,688	)		20,858			(12,107	)		(9,937	)
(Benefit)/provision for income taxes		(11,980	)		8,751			-			(3,229	)
Net loss	$	(6,708	)	$	12,107		$	(12,107	)	$	(6,708	)
Other comprehensive loss:
Pension liability reclassification, net of tax		927			-			-			927
Total comprehensive loss	$	(5,781	)	$	12,107		$	(12,107	)	$	(5,781	)

Condensed Consolidating Statement of Operations and

Comprehensive (Loss)/Income

For the Thirteen Weeks Ended December 3, 2013

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	198,850		$	75,869		$	-		$	274,719
Franchise revenue		98			1,392			-			1,490
		198,948			77,261			-			276,209
Operating costs and expenses:
Cost of goods sold		56,320			21,349			-			77,669
Payroll and related costs		69,365			28,152			-			97,517
Other restaurant operating costs		46,493			18,796			-			65,289
Depreciation		10,208			3,707			-			13,915
Selling, general, and administrative		25,724			11,307			-			37,031
Intercompany selling, general, and administrative allocations		14,008			(14,008	)		-			-
Closures and impairments		8,058			6,085			-			14,143
Equity in earnings of subsidiaries		104			-			(104	)		-
Interest expense, net		5,171			1,449			-			6,620
Intercompany interest expense/(income)		3,229			(3,229	)		-			-
Loss on extinguishment of debt		672			-			-			672
		239,352			73,608			(104	)		312,856
(Loss)/income from continuing operations before income taxes		(40,404	)		3,653			104			(36,647	)
(Benefit)/provision for income taxes from continuing operations		(5,667	)		3,757			-			(1,910	)
(Loss)/income from continuing operations		(34,737	)		(104	)		104			(34,737	)
Income from discontinued operations, net of tax		354			-			-			354
Net (loss)/income	$	(34,383	)	$	(104	)	$	104		$	(34,383	)
Other comprehensive income:
Pension liability reclassification, net of tax		477			-			-			477
Total comprehensive (loss)/income	$	(33,906	)	$	(104	)	$	104		$	(33,906	)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	408,932		$	153,879		$	-		$	562,811
Franchise revenue		119			2,953			-			3,072
		409,051			156,832			-			565,883
Operating costs and expenses:
Cost of goods sold		114,847			42,760			-			157,607
Payroll and related costs		142,891			57,359			-			200,250
Other restaurant operating costs		94,895			37,928			-			132,823
Depreciation		20,572			7,552			-			28,124
Selling, general, and administrative		51,718			22,328			-			74,046
Intercompany selling, general, and administrative allocations		28,771			(28,771	)		-			-
Closures and impairments		13,223			8,953			-			22,176
Equity in earnings of subsidiaries		(4,421	)		-			4,421			-
Interest expense, net		10,231			3,142			-			13,373
Intercompany interest expense/(income)		6,414			(6,414	)		-			-
Loss on extinguishment of debt		1,183			-			-			1,183
		480,324			144,837			4,421			629,582
(Loss)/income from continuing operations before income taxes		(71,273	)		11,995			(4,421	)		(63,699	)
(Benefit)/provision for income taxes from continuing operations		(14,637	)		7,574			-			(7,063	)
(Loss)/income from continuing operations		(56,636	)		4,421			(4,421	)		(56,636	)
Income from discontinued operations, net of tax		11			-			-			11
Net (loss)/income	$	(56,625	)	$	4,421		$	(4,421	)	$	(56,625	)
Other comprehensive income:
Pension liability reclassification, net of tax		955			-			-			955
Total comprehensive (loss)/income	$	(55,670	)	$	4,421		$	(4,421	)	$	(55,670	)

Condensed Consolidating Statement of Cash Flows

For the Twenty-Six Weeks Ended December 2, 2014

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Net cash provided by operating activities	$	25,640		$	43,870		$	(59,553	)	$	9,957
Investing activities:
Purchases of property and equipment		(11,002	)		(2,819	)		-			(13,821	)
Proceeds from disposal of assets		4,607			997			-			5,604
Other, net		1,146			135			-			1,281
Net cash used by investing activities		(5,249	)		(1,687	)		-			(6,936	)
Financing activities:
Principal payments on long-term debt		(16	)		(6,250	)		-			(6,266	)
Stock repurchases		(55	)		-			-			(55	)
Payments for debt issuance costs		(75	)		-			-			(75	)
Proceeds from exercise of stock options		197			-			-			197
Excess tax benefits from share-based compensation		22			-			-			22
Intercompany transactions		(23,610	)		(35,943	)		59,553			-
Net cash used by financing activities		(23,537	)		(42,193	)		59,553			(6,177	)
Decrease in cash and cash equivalents		(3,146	)		(10	)		-			(3,156	)
Cash and cash equivalents:
Beginning of year		51,012			314			-			51,326
End of quarter	$	47,866		$	304		$	-		$	48,170

Condensed Consolidating Statement of Cash Flows

For the Twenty-Six Weeks Ended December 3, 2013

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Net cash (used)/provided by operating activities	$	(22,630	)	$	36,648		$	(13,590	)	$	428
Investing activities:
Purchases of property and equipment		(12,902	)		(4,795	)		-			(17,697	)
Proceeds from sale-leaseback transactions, net		5,637			-			-			5,637
Proceeds from disposal of assets		7,434			1,023			-			8,457
Other, net		187			-			-			187
Net cash provided/(used) by investing activities		356			(3,772	)		-			(3,416	)
Financing activities:
Principal payments on long-term debt		(12,968	)		(12,838	)		-			(25,806	)
Stock repurchases		(540	)		-			-			(540	)
Payments for debt issuance costs		(1,718	)		-			-			(1,718	)
Proceeds from exercise of stock options		1,480			-			-			1,480
Excess tax benefits from share-based compensation		283			-			-			283
Intercompany transactions		6,415			(20,005	)		13,590			-
Net cash used by financing activities		(7,048	)		(32,843	)		13,590			(26,301	)
(Decrease)/increase in cash and cash equivalents		(29,322	)		33			-			(29,289	)
Cash and cash equivalents:
Beginning of year		52,635			272			-			52,907
End of quarter	$	23,313		$	305		$	-		$	23,618