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Note 14 - Supplemental Condensed Consolidating Financial Statements
 9 Months Ended
Mar. 01, 2016
Notes to Financial Statements  
Condensed Financial Statements [Text Block]
NOTE 14 – SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS
 
As discussed in Note 6 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 March 1, 2016
(In thousands)
 
 
 
Parent
 
 
Guarantors
 
 
Eliminations
 
 
Consolidated
 
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current assets:
                                
Cash and cash equivalents
   $ 52,266     $ 192     $ –     $ 52,458  
Accounts receivable
     2,007       3,859       –       5,866  
Inventories
     16,056       6,531       –       22,587  
Income tax receivable
     169,478       –       (166,520
)
     2,958  
Other current assets
     12,065       2,857       –       14,922  
Total current assets
     251,872       13,439       (166,520
)
     98,791  
                                 
Property and equipment, net
     530,521       192,049       –       722,570  
Deferred income taxes, net
     5,271       (3,276
)
     –       1,995  
Investment in subsidiaries
     123,422       –       (123,422
)
     –  
Due from/(to) subsidiaries
     74,673       224,422       (299,095
)
     –  
Other assets
     40,191       6,917       –       47,108  
Total assets
   $ 1,025,950     $ 433,551     $ (589,037
)
   $ 870,464  
                                 
Liabilities & Shareholders’ Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current liabilities:
                                
Accounts payable
   $ 13,299     $ 2,903     $ –     $ 16,202  
Accrued and other current liabilities
     37,052       32,054       –       69,106  
Current maturities of long-term debt,
including capital leases
     (1,046
)
     12,010       –       10,964  
Income tax payable
     –       166,520       (166,520
)
     –  
Deferred income taxes, net
     5,011       (2,399
)
     –       2,612  
Total current liabilities
     54,316       211,088       (166,520
)
     98,884  
                                 
Long-term debt and capital leases,
less current maturities
     208,773       9,344       –       218,117  
Due to/(from) subsidiaries
     224,422       74,673       (299,095
)
     –  
Other deferred liabilities
     102,885       15,024       –       117,909  
Total liabilities
     590,396       310,129       (465,615
)
     434,910  
                                 
Shareholders’ equity:
                                
Common stock
     602       –       –       602  
Capital in excess of par value
     75,592       –       –       75,592  
Retained earnings
     368,953       123,422       (123,422
)
     368,953  
Accumulated other comprehensive loss
     (9,593
)
     –       –       (9,593
)
Total shareholders’ equity
     435,554       123,422       (123,422
)
     435,554  
                                 
Total liabilities & shareholders’ equity
   $ 1,025,950     $ 433,551     $ (589,037
)
   $ 870,464  
 
Condensed Consolidating Balance Sheet
As of June 2, 2015 (as adjusted)
(In thousands)
 
 
 
Parent
 
 
Guarantors
 
 
Eliminations
 
 
Consolidated
 
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current assets:
                                
Cash and cash equivalents
   $ 75,034     $ 297     $ –     $ 75,331  
Accounts receivable
     1,557       3,730       –       5,287  
Inventories
     14,581       5,830       –       20,411  
Income tax receivable
     153,146       –       (153,146
)
     –  
Other current assets
     15,543       2,308       –       17,851  
Total current assets
     259,861       12,165       (153,146
)
     118,880  
                                 
Property and equipment, net
     554,089       198,085       –       752,174  
Investment in subsidiaries
     128,824       –       (128,824
)
     –  
Due from/(to) subsidiaries
     66,019       215,373       (281,392
)
     –  
Other assets
     44,118       10,280       –       54,398  
Total assets
   $ 1,052,911     $ 435,903     $ (563,362
)
   $ 925,452  
                                 
Liabilities & Shareholders’ Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current liabilities:
                                
Accounts payable
   $ 18,533     $ 4,472     $ –     $ 23,005  
Accrued and other current liabilities
     42,458       33,764       –       76,222  
Current maturities of long-term debt,
including capital leases
     (994
)
     11,072       –       10,078  
Income tax payable
     –       154,215       (153,146
)
     1,069  
Deferred income taxes, net
     2,839       (2,832
)
     –       7  
Total current liabilities
     62,836       200,691       (153,146
)
     110,381  
                                 
Long-term debt and capital leases,
less current maturities
     210,382       20,635       –       231,017  
Deferred income taxes, net
     (3,865
)
     5,307       –       1,442  
Due to/(from) subsidiaries
     215,373       66,019       (281,392
)
     –  
Other deferred liabilities
     102,602       14,427       –       117,029  
Total liabilities
     587,328       307,079       (434,538
)
     459,869  
                                 
Shareholders’ equity:
                                
Common stock
     621       –       –       621  
Capital in excess of par value
     83,870       –       –       83,870  
Retained earnings
     392,032       128,824       (128,824
)
     392,032  
Accumulated other comprehensive loss
     (10,940
)
     –       –       (10,940
)
Total shareholders’ equity
     465,583       128,824       (128,824
)
     465,583  
                                 
Total liabilities & shareholders’ equity
   $ 1,052,911     $ 435,903     $ (563,362
)
   $ 925,452  
 
Condensed Consolidating Statement of Operations and
Comprehensive (Loss)/Income
For the Thirteen Weeks Ended March 1, 2016
(In thousands)
 
 
 
Parent
 
 
Guarantors
 
 
Eliminations
 
 
Consolidated
 
Revenue:
                                
Restaurant sales and operating revenue
   $ 194,527     $ 75,341     $ –     $ 269,868  
Franchise revenue
     90       1,512       –       1,602  
      194,617       76,853       –       271,470  
                                 
Operating costs and expenses:
                                
Cost of goods sold
     54,209       20,934       –       75,143  
Payroll and related costs
     65,474       27,883       –       93,357  
Other restaurant operating costs
     40,008       15,303       –       55,311  
Depreciation and amortization
     9,008       3,724       –       12,732  
Selling, general, and administrative
     17,000       10,378       –       27,378  
Intercompany selling, general, and
administrative allocations
     10,726       (10,726
)
     –       –  
Closures and impairments, net
     3,993       2,130       –       6,123  
Equity in earnings of subsidiaries
     (5,676
)
     –       5,676       –  
Interest expense, net
     4,566       439       –       5,005  
Intercompany interest expense/(income)
     3,058       (3,058
)
     –       –  
Gain on extinguishment of debt
     (10
)
     –       –       (10
)
      202,356       67,007       5,676       275,039  
                                 
(Loss)/income before income taxes
     (7,739
)
     9,846       (5,676
)
     (3,569
)
(Benefit)/provision for income taxes
     (4,653
)
     4,170       –       (483
)
                                 
Net (loss)/income
   $ (3,086
)
   $ 5,676     $ (5,676
)
   $ (3,086
)
                                 
Other comprehensive income:
                                
Pension liability reclassification
     885       –       –       885  
Total comprehensive (loss)/income
   $ (2,201
)
   $ 5,676     $ (5,676
)
   $ (2,201
)
 
Condensed Consolidating Statement of Operations and
Comprehensive (Loss)/Income
For the Thirty-Nine Weeks Ended March 1, 2016
(In thousands)
 
 
 
Parent
 
 
Guarantors
 
 
Eliminations
 
 
Consolidated
 
Revenue:
                                
Restaurant sales and operating revenue
   $ 583,055     $ 224,050     $ –     $ 807,105  
Franchise revenue
     220       4,581       –       4,801  
      583,275       228,631       –       811,906  
                                 
Operating costs and expenses:
                                
Cost of goods sold
     160,212       61,477       –       221,689  
Payroll and related costs
     197,732       83,244       –       280,976  
Other restaurant operating costs
     126,234       47,669       –       173,903  
Depreciation and amortization
     27,305       11,169       –       38,474  
Selling, general, and administrative
     53,388       31,234       –       84,622  
Intercompany selling, general, and
administrative allocations
     32,188       (32,188
)
     –       –  
Closures and impairments, net
     16,080       2,828       –       18,908  
Trademark impairment
     –       1,999       –       1,999  
Equity in earnings of subsidiaries
     (18,907
)
     –       18,907       –  
Interest expense, net
     13,816       2,294       –       16,110  
Intercompany interest expense/(income)
     9,049       (9,049
)
     –       –  
Gain on extinguishment of debt
     (10
)
     –       –       (10
)
      617,087       200,677       18,907       836,671  
                                 
(Loss)/income before income taxes
     (33,812
)
     27,954       (18,907
)
     (24,765
)
(Benefit)/provision for income taxes
     (10,733
)
     9,047       –       (1,686
)
                                 
Net (loss)/income
   $ (23,079
)
   $ 18,907     $ (18,907
)
   $ (23,079
)
                                 
Other comprehensive income:
                                
Pension liability reclassification
     1,347       –       –       1,347  
Total comprehensive (loss)/income
   $ (21,732
)
   $ 18,907     $ (18,907
)
   $ (21,732
)
 
Condensed Consolidating Statement of Operations and
Comprehensive (Loss)/Income
For the Thirteen Weeks Ended March 3, 2015
(In thousands)
 
 
 
Parent
 
 
Guarantors
 
 
Eliminations
 
 
Consolidated
 
Revenue:
                                
Restaurant sales and operating revenue
   $ 204,278     $ 80,114     $ –     $ 284,392  
Franchise revenue
     4       1,517       –       1,521  
      204,282       81,631       –       285,913  
                                 
Operating costs and expenses:
                                
Cost of goods sold
     55,793       22,003       –       77,796  
Payroll and related costs
     67,959       28,721       –       96,680  
Other restaurant operating costs
     43,565       17,407       –       60,972  
Depreciation and amortization
     9,307       3,654       –       12,961  
Selling, general, and administrative
     18,244       10,704       –       28,948  
Intercompany selling, general, and
administrative allocations
     11,371       (11,371
)
     –       –  
Closures and impairments
     2,086       1,905       –       3,991  
Equity in earnings of subsidiaries
     (7,171
)
     –       7,171       –  
Interest expense, net
     4,654       792       –       5,446  
Intercompany interest expense/(income)
     3,040       (3,040
)
     –       –  
      208,848       70,775       7,171       286,794  
                                 
(Loss)/income before income taxes
     (4,566
)
     10,856       (7,171
)
     (881 )
(Benefit)/provision for income taxes     (3,797 )     3,685       –       (112 )
                                 
Net (loss)/income
   $ (769
)
   $ 7,171     $ (7,171 )   $ (769 )
                                 
Other comprehensive income:
                                
Pension liability reclassification
     463       –       –       463  
Total comprehensive (loss)/income
   $ (306
)
   $ 7,171     $ (7,171 )   $ (306 )
 
Condensed Consolidating Statement of Operations and
Comprehensive (Loss)/Income
For the Thirty-Nine Weeks Ended March 3, 2015
(In thousands)
 
 
 
Parent
 
 
Guarantor
 
 
Eliminations
 
 
Consolidated
 
Revenue:
                                
Restaurant sales and operating revenue
   $ 595,401     $ 229,654     $ –     $ 825,055  
Franchise revenue
     188       4,511       –       4,699  
      595,589       234,165       –       829,754  
                                 
Operating costs and expenses:
                                
Cost of goods sold
     162,041       62,548       –       224,589  
Payroll and related costs
     202,349       84,137       –       286,486  
Other restaurant operating costs
     130,314       49,392       –       179,706  
Depreciation and amortization
     28,197       11,122       –       39,319  
Selling, general, and administrative
     55,013       32,128       –       87,141  
Intercompany selling, general, and
administrative allocations
     32,986       (32,986
)
     –       –  
Closures and impairments
     4,390       2,158       –       6,548  
Equity in earnings of subsidiaries
     (19,278
)
     –       19,278       –  
Interest expense, net
     13,901       2,882       –       16,783  
Intercompany interest expense/(income)
     8,930       (8,930
)
     –       –  
      618,843       202,451       19,278       840,572  
                                 
(Loss)/income before income taxes
     (23,254
)
     31,714       (19,278
)
     (10,818
)
(Benefit)/provision for income taxes
     (15,777
)
     12,436       –       (3,341
)
                                 
Net (loss)/income
   $ (7,477
)
   $ 19,278     $ (19,278
)
   $ (7,477
)
                                 
Other comprehensive income:
                                
Pension liability reclassification
     1,390       –       –       1,390  
Total comprehensive (loss)/income
   $ (6,087
)
   $ 19,278     $ (19,278
)
   $ (6,087
)
 
Condensed Consolidating Statement of Cash Flows
For the Thirty-Nine Weeks Ended March 1, 2016
(In thousands)
 
 
 
Parent
 
 
Guarantors
 
 
Eliminations
 
 
Consolidated
 
                                 
Net cash (used)/provided by operating activities
   $ (8,133
)
   $ 41,932     $ (15,260
)
   $ 18,539  
                                 
Investing activities:
                                
Purchases of property and equipment
     (19,892
)
     (7,454
)
     –       (27,346
)
Proceeds from disposal of assets
     6,193       –       –       6,193  
Other, net
     2,444       –       –       2,444  
Net cash used by investing activities
    (11,255
)
     (7,454
)
     –       (18,709
)
                                 
Financing activities:
                                
Principal payments on long-term debt
     (2,390
)
     (10,274
)
     –       (12,664
)
Stock repurchases
     (10,009
)
     –       –       (10,009
)
Payments for debt issuance costs
    (30
)
     –       –       (30
)
Intercompany transactions
     9,049       (24,309
)
     15,260       –  
Net cash used by financing activities
     (3,380
)
     (34,583
)
     15,260       (22,703
)
                                 
Decrease in cash and cash equivalents
     (22,768
)
     (105
)
     –       (22,873
)
Cash and cash equivalents:
                                
Beginning of year
     75,034       297       –       75,331  
End of quarter
   $ 52,266     $ 192     $ –     $ 52,458  
 
Condensed Consolidating Statement of Cash Flows
For the Thirty-Nine Weeks Ended March 3, 2015
(In thousands)
 
 
 
Parent
 
 
Guarantors
 
 
Eliminations
 
 
Consolidated
 
                                 
Net cash provided by operating activities
   $ 37,226     $ 51,900     $ (61,699
)
   $ 27,427  
                                 
Investing activities:
                                
Purchases of property and equipment
     (16,569
)
     (4,565
)
     –       (21,134
)
Proceeds from disposal of assets
     7,649       1,047       –       8,696  
Other, net
     2,043       135       –       2,178  
Net cash used by investing activities
    (6,877
)
     (3,383
)
     –       (10,260
)
                                 
Financing activities:
                                
Principal payments on long-term debt
     (6
)
     (7,406
)
     –       (7,412
)
Stock repurchases
     (73
)
     –       –       (73
)
Payments for debt issuance costs
     (281
)
     –       –       (281
)
Proceeds from exercise of stock options
     457       –       –       457  
Excess tax benefits from share-based
compensation
     37       –       –       37  
Intercompany transactions
     (20,570
)
     (41,129
)
     61,699       –  
Net cash used by financing activities
     (20,436
)
     (48,535
)
     61,699       (7,272
)
                                 
Increase/(decrease) in cash and cash equivalents
     9,913       (18
)
     –       9,895  
Cash and cash equivalents:
                                
Beginning of year
     51,012       314       –       51,326  
End of quarter
   $ 60,925     $ 296     $ –     $ 61,221