REVENUE RECOGNITION

12 Months Ended

Jun. 29, 2022

Revenue Recognition [Abstract]

REVENUE RECOGNITION

Deferred Franchise and Development Fees

Our deferred franchise and development fees consist of the unrecognized fees received from franchisees. Recognition of these fees in subsequent periods is based on satisfaction of the contractual performance obligations of the active contracts with franchisees. The weighted average remaining term of the current franchise agreements, including certain renewal periods expected to be exercised, was approximately 20 years as of June 29, 2022. We also expect to earn subsequent period royalties and advertising fees related to our franchise contracts; however, due to the variability and uncertainty of these future revenues based upon a sales-based measure, these future revenues are not yet estimable as the performance obligations remain unsatisfied.

The following table reflects the changes in deferred franchise and development fees for the fiscal years ended on June 29, 2022 and June 30, 2021:

	June 29, 2022		June 30, 2021
Beginning balance	$	11.4	$	12.7
Additions	1.1		0.3
Amount recognized to Other gains and charges(1)	(0.9)		0.2
Amount recognized to Franchise and other revenues	(1.5)		(1.8)
Ending balance	$	10.1	$	11.4

(1)The remaining deferred franchise and development fee balances associated with the 68 Chili’s restaurants acquired during fiscal 2022 were recognized as of the acquisition dates in Other (gains) and charges in the

Consolidated Statements of Comprehensive Income. Refer to Note 2 - Chili’s Restaurant Acquisitions for further details.

The following table illustrates franchise and development fees expected to be recognized in the future related to performance obligations that were unsatisfied or partially unsatisfied as of June 29, 2022:

Fiscal Year	Franchise and Development Fees Revenue Recognition
2023	$	0.9
2024	0.8
2025	0.8
2026	0.8
2027	0.7
Thereafter	6.1
	$	10.1

Deferred Gift Card Revenues

Total deferred revenues related to our gift cards include the full value of unredeemed gift card balances less recognized breakage and the unamortized portion of third-party fees. The following table reflects the changes in the Gift card liability for fiscal years ended on June 29, 2022 and June 30, 2021:

	June 29, 2022		June 30, 2021
Beginning balance	$	106.4	$	109.9
Gift card sales	134.8		118.8
Gift card redemptions recognized to Company sales	(122.1)		(109.5)
Gift card breakage recognized to Franchise and other revenues(1)	(36.1)		(13.0)
Other	0.9		0.2
Ending balance	$	83.9	$	106.4

(1)Gift card breakage recognized to Franchise and other revenues increased due to a change in estimated gift card breakage rates primarily attributable to gift cards sold prior to fiscal 2022.