SEGMENT INFORMATION

12 Months Ended

Jun. 24, 2020

Segment Information [Abstract]

SEGMENT INFORMATION

Our operating segments are Chili’s and Maggiano’s. The Chili’s segment includes the results of our Company-owned Chili’s restaurants principally in the United States, within the full-service casual dining segment of the industry. The Chili’s segment also has Company-owned restaurants in Canada, and franchised locations in the United States, 28 countries and two United States territories. The Maggiano’s segment includes the results of our Company-owned Maggiano’s restaurants in the United States as well as the results from our domestic franchise business.

Company sales include revenues generated by the operation of Company-owned restaurants including gift card redemptions. Franchise and other revenues include Royalties and Franchise fees and other revenues. Franchise fees and other revenues include gift card breakage, Maggiano’s banquet service charge income, franchise advertising fees, delivery fee income, digital entertainment revenues, gift card equalization, franchise and development fees, merchandise income, retail royalty revenues, and gift card discount costs from third-party gift card sales. We do not rely on any major customers as a source of sales, and the customers and long-lived assets of our operating segments are predominantly in the United States. There were no material transactions amongst our operating segments.

Our chief operating decision maker uses Operating income as the measure for assessing performance of our segments. Operating income includes revenues and expenses directly attributable to segment-level results of operations. Company restaurant expenses include Food and beverage costs, Restaurant labor, and Restaurant expenses. Restaurant expenses during the years presented primarily included restaurant rent, supplies, property and equipment maintenance, utilities, advertising expenses, credit card processing fees and property taxes. The following tables reconcile our segment results to the consolidated results reported in accordance with GAAP:

	Fiscal Year Ended June 24, 2020
	Chili’s(2)			Maggiano’s		Other			Consolidated
Company sales	$	2,673.5		$	331.4	$	—		$	3,004.9
Royalties	33.7			0.2		—			33.9
Franchise fees and other revenues	24.5			15.2		—			39.7
Franchise and other revenues	58.2			15.4		—			73.6
Total revenues	2,731.7			346.8		—			3,078.5
Company restaurant expenses(1)	2,363.2			306.1		0.6			2,669.9
Depreciation and amortization	133.9			15.4		13.0			162.3
General and administrative	32.1			5.7		98.5			136.3
Other (gains) and charges	35.3			6.8		5.3			47.4
Total operating costs and expenses	2,564.5			334.0		117.4			3,015.9
Operating income (loss)	167.2			12.8		(117.4		)	62.6
Interest expenses	4.6			—		55.0			59.6
Other (income), net	(0.6		)	—		(1.3		)	(1.9		)
Income (loss) before income taxes	$	163.2		$	12.8	$	(171.1	)	$	4.9
Segment assets(3)	$	1,967.3		$	228.2	$	160.5		$	2,356.0
Payments for property and equipment	88.2			8.1		8.2			104.5

	Fiscal Year Ended June 26, 2019
	Chili’s			Maggiano’s		Other			Consolidated
Company sales	$	2,692.6		$	413.6	$	—		$	3,106.2
Royalties	52.8			0.3		—			53.1
Franchise fees and other revenues	36.8			21.8		—			58.6
Franchise and other revenues	89.6			22.1		—			111.7
Total revenues	2,782.2			435.7		—			3,217.9
Company restaurant expenses(1)	2,329.6			364.8		0.6			2,695.0
Depreciation and amortization	120.1			16.2		11.3			147.6
General and administrative	38.7			6.1		104.3			149.1
Other (gains) and charges(4)	(6.4		)	1.0		0.9			(4.5		)
Total operating costs and expenses	2,482.0			388.1		117.1			2,987.2
Operating income (loss)	300.2			47.6		(117.1		)	230.7
Interest expenses	3.2			0.3		58.1			61.6
Other (income), net	—			—		(2.7		)	(2.7		)
Income (loss) before income taxes	$	297.0		$	47.3	$	(172.5	)	$	171.8
Segment assets	$	1,002.8		$	163.9	$	91.6		$	1,258.3
Payments for property and equipment	129.1			10.8		27.7			167.6

	Fiscal Year Ended June 27, 2018
	Chili’s		Maggiano’s		Other			Consolidated
Company sales	$	2,628.3	$	413.2	$	—		$	3,041.5
Franchise and other revenues	71.9		22.0		—			93.9
Total revenues	2,700.2		435.2		—			3,135.4
Company restaurant expenses(1)	2,224.0		362.8		0.6			2,587.4
Depreciation and amortization	125.0		15.9		10.5			151.4
General and administrative	39.6		5.5		90.9			136.0
Other (gains) and charges	24.5		1.1		8.9			34.5
Total operating costs and expenses	2,413.1		385.3		110.9			2,909.3
Operating income (loss)	287.1		49.9		(110.9		)	226.1
Interest expenses	—		—		59.0			59.0
Other (income), net	—		—		(3.1		)	(3.1		)
Income (loss) before income taxes	$	287.1	$	49.9	$	(166.8	)	$	170.2
Payments for property and equipment	$	85.3	$	7.6	$	8.4		$	101.3

⁽¹⁾  Company restaurant expenses include Food and beverage costs, Restaurant labor and Restaurant expenses, including advertising expenses. Fiscal 2020 and fiscal 2019, are presented under the ASC 606 revenue accounting standard such that advertising contributions received from Chili’s franchisees are recorded as Franchise fees and other revenues, which differs from fiscal 2018 that included advertising contributions on a net basis within Company restaurant expenses.

⁽²⁾  Chili’s segment information for fiscal 2020 includes the results of operations and fair value of assets and goodwill related to the 116 restaurants purchased from a former franchisee since the September 5, 2019 acquisition date. Refer to Note 3 - Chili's Restaurant Acquisition for further details.

⁽³⁾  Segment assets for fiscal 2020 are presented in accordance with the newly adopted ASC 842 lease accounting standard that now include Operating lease assets. Refer to Note 4 - Leases for further details.

⁽⁴⁾ 

Other (gains) and charges in fiscal 2019 included the net impact from our completed sale leaseback transactions of 151 Company-owned Chili’s restaurant properties and one Maggiano’s property. As part of this transaction, we sold the related restaurant fixed assets, net of accumulated depreciation, totaling $185.3 million. Chili’s recognized a $26.8 million, and Maggiano’s recognized a $0.5 million gain on the sale, including a certain portion of the deferred gain, net of related transaction costs incurred in Other (gains) and charges in the Consolidated Statements of Comprehensive Income. Refer to Note 4 - Leases for further details.