Revenue Recognition

12 Months Ended

Dec. 30, 2018

4. Revenue Recognition

Disaggregation of Revenue

In the following table (in thousands), revenue is disaggregated by major product line. The table also includes a reconciliation of the disaggregated revenue with the reportable segments.


	Reportable Segments
	Year Ended December 30, 2018
Major Products/Services Lines		Domestic Company-owned restaurants		North America commissaries		North America franchising		International		All others		Total
Company-owned restaurant sales	$	692,380	$	-	$	-	$	6,237	$	-	$	698,617
Commissary sales		-		811,191		-		68,124		-		879,315
Franchise royalties and fees		-		-		82,258		35,988		-		118,246
Other revenues		-		-		-		21,202		91,205		112,407
Eliminations		-		(201,325)		(2,965)		(283)		(30,696)		(235,269)
Total	$	692,380	$	609,866	$	79,293	$	131,268	$	60,509	$	1,573,316

The revenue summarized above is described in Note 2 under the heading “Significant Accounting Policies – Revenue Recognition.”

Contract Balances

The contract liabilities primarily relate to franchise fees which we classify as “Deferred revenue” and customer loyalty program obligations which are classified with “Accrued expenses and other current liabilities.” During the year ended December 30, 2018, the Company recognized $15.7 million in revenue, related to deferred revenue and customer loyalty program.


	Contract Liabilities (in thousands)
		December 30, 2018		January 1, 2018		Change
Deferred revenue	$	17,122	$	15,850	$	1,272
Customer loyalty program		18,019		14,724		3,295
Total contract liabilities	$	35,141	$	30,574	$	4,567

The contract assets consist primarily of equipment incentives provided to franchisees. Equipment incentives are related to the future value of commissary revenue the Company will receive over the term of the agreement.

As of December 30, 2018 and January 1, 2018, the contract assets were approximately $6.6 million and $7.1 million, respectively. For the year ended December 30, 2018, revenue was reduced approximately $4.0 million for the amortization of contract assets over the applicable contract terms. Contract assets are included in Other Current Assets and Other Assets.