SEGMENT INFORMATION

9 Months Ended

Mar. 29, 2023

Segment Reporting [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, which are principally located 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. The Other segment includes costs related to our restaurant support teams for the Chili’s and Maggiano’s brands, including operations, finance, franchise, marketing, human resources and culinary innovation. The Other segment also includes costs related to the common and shared infrastructure, including accounting, information technology, purchasing, guest relations, legal and restaurant development.

Company sales for each segment include revenues generated by the operation of Company-owned restaurants including food and beverage sales, net of discounts, gift card breakage, Maggiano’s banquet service charge income, delivery, digital entertainment revenues, merchandise income and gift card discount costs from third-party gift card sales. Franchise revenues for each operating segment include royalties, franchise advertising fees, franchise and development fees and gift card equalization.

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 located 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. Restaurant expenses during the periods presented primarily includes restaurant rent, supplies, repair and maintenance expenses, utilities, delivery fees, advertising, credit card processing fees, and property taxes.

The following tables reconcile our segment results to our consolidated results reported in accordance with GAAP:

	Thirteen Week Period Ended March 29, 2023
	Chili’s		Maggiano's		Corporate		Consolidated
Company sales	$	953.2	$	119.7	$	—	$	1,072.9
Franchise revenues	10.2		0.1		—		10.3
Total revenues	963.4		119.8		—		1,083.2
Food and beverage costs	257.9		29.6		—		287.5
Restaurant labor	322.0		39.2		—		361.2
Restaurant expenses	247.5		33.1		0.3		280.9
Depreciation and amortization	36.7		3.3		2.5		42.5
General and administrative	8.8		2.0		29.8		40.6
Other (gains) and charges	2.2		0.4		3.7		6.3
Total operating costs and expenses	875.1		107.6		36.3		1,019.0
Operating income (loss)	88.3		12.2		(36.3)		64.2
Interest expenses	1.0		—		13.2		14.2
Other income, net	—		—		(0.6)		(0.6)
Income (loss) before income taxes	$	87.3	$	12.2	$	(48.9)	$	50.6

	Thirteen Week Period Ended March 30, 2022
	Chili's(1)		Maggiano's		Corporate		Consolidated
Company sales(2)	$	870.2	$	100.7	$	—	$	970.9
Franchise revenues(2)	9.4		0.1		—		9.5
Total revenues	879.6		100.8		—		980.4
Food and beverage costs	245.6		24.7		—		270.3
Restaurant labor	295.0		34.1		—		329.1
Restaurant expenses	215.2		28.7		0.2		244.1
Depreciation and amortization	35.9		3.4		2.9		42.2
General and administrative	9.5		2.3		27.4		39.2
Other (gains) and charges	5.2		—		0.9		6.1
Total operating costs and expenses	806.4		93.2		31.4		931.0
Operating income (loss)	73.2		7.6		(31.4)		49.4
Interest expenses	1.2		0.1		9.8		11.1
Other income, net	—		—		(0.4)		(0.4)
Income (loss) before income taxes	$	72.0	$	7.5	$	(40.8)	$	38.7

	Thirty-Nine Week Period Ended March 29, 2023
	Chili’s		Maggiano's		Corporate		Consolidated
Company sales	$	2,663.1	$	365.3	$	—	$	3,028.4
Franchise revenues	28.9		0.4		—		29.3
Total revenues	2,692.0		365.7		—		3,057.7
Food and beverage costs	772.5		93.9		—		866.4
Restaurant labor	908.7		117.7		—		1,026.4
Restaurant expenses	718.5		99.0		0.6		818.1
Depreciation and amortization	108.7		9.8		7.7		126.2
General and administrative	26.8		6.0		82.9		115.7
Other (gains) and charges	10.9		1.2		7.7		19.8
Total operating costs and expenses	2,546.1		327.6		98.9		2,972.6
Operating income (loss)	145.9		38.1		(98.9)		85.1
Interest expenses	2.9		0.2		37.3		40.4
Other income, net	—		—		(1.3)		(1.3)
Income (loss) before income taxes	$	143.0	$	37.9	$	(134.9)	$	46.0
Segment assets	$	2,116.8	$	227.2	$	134.1	$	2,478.1
Segment goodwill	156.4		38.4		—		194.8
Payments for property and equipment	119.4		10.7		6.5		136.6

	Thirty-Nine Week Period Ended March 30, 2022
	Chili’s(1)		Maggiano's		Corporate		Consolidated
Company sales(2)	$	2,445.5	$	306.8	$	—	$	2,752.3
Franchise revenues(2)	29.9		0.4		—		30.3
Total revenues	2,475.4		307.2		—		2,782.6
Food and beverage costs	683.8		73.6		—		757.4
Restaurant labor	846.1		103.3		—		949.4
Restaurant expenses	624.8		86.8		0.5		712.1
Depreciation and amortization	104.3		10.2		8.6		123.1
General and administrative	24.7		6.2		77.9		108.8
Other (gains) and charges	10.2		0.2		6.6		17.0
Total operating costs and expenses	2,293.9		280.3		93.6		2,667.8
Operating income (loss)	181.5		26.9		(93.6)		114.8
Interest expenses	4.0		0.3		30.5		34.8
Other income, net	(0.3)		—		(0.9)		(1.2)
Income (loss) before income taxes	$	177.8	$	26.6	$	(123.2)	$	81.2
Payments for property and equipment	$	96.7	$	6.8	$	5.5	$	109.0

(1)Chili’s segment information includes the results of operations and the fair values of assets related to the 68 restaurants purchased from three former franchisees subsequent to the various acquisition dates during fiscal 2022. Refer to Note 14 - Fiscal 2022 Chili’s Restaurant Acquisitions for further details.

(2)Certain changes in presentation have been made to fiscal 2022 revenue amounts to enhance comparability to the fiscal 2023 presentation. These reclassifications have no effect on Total revenues or Net income previously reported. Refer to Note 1 - Basis of Presentation for further details.