DineEquity, Inc. Reports First Quarter Fiscal 2016 Results

Company Reiterates Financial Performance Guidance for Fiscal 2016

First Quarter 2016 Summary

  • Adjusted EPS (Non-GAAP) of $1.58
  • GAAP EPS of $1.37
  • Domestic system-wide comparable same-restaurant sales increased 1.5% at IHOP and decreased 3.7% at Applebee's
  • Generated strong free cash flow of approximately $39 million
  • Returned a combined total of approximately $37 million to shareholders in share repurchases and a first quarter cash dividend

GLENDALE, Calif. - May 5, 2016 // PRNewswire // - DineEquity, Inc. (NYSE: DIN), the parent company of Applebee's Neighborhood Grill & Bar® and IHOP® restaurants, today announced financial results for the first quarter of fiscal 2016. 

"We continued to generate strong free cash flow in the first quarter and returned the majority of it to our shareholders. We're aggressively executing our plan to get Applebee's back on track, including the most transformative platform launch in the brand's history in the coming weeks.  We remain focused on building on IHOP's momentum through the implementation of several strategic initiatives that address all aspects of enhancing the guest experience," said Julia A. Stewart, Chairman and Chief Executive Officer of DineEquity, Inc. 

Ms. Stewart concluded, "We are confident in the steps currently being taken to drive positive and sustainable sales and traffic at both brands, while remaining committed to returning the majority of free cash flow to our shareholders."  

First Quarter of Fiscal 2016 Financial Results

  • Adjusted net income available to common stockholders was $29.1 million, or adjusted earnings per diluted share of $1.58, for the first quarter of 2016.  This compares to $31.1 million, or adjusted earnings per diluted share of $1.64, for the same period of 2015.  The decline in adjusted net income was mainly due to the expected increase in general and administrative expenses and the impact on gross profit from the sale of the remaining Applebee's company-operated restaurants in the third quarter of 2015.  The decline was partially offset by fewer weighted average shares outstanding. (See "Non-GAAP Financial Measures" below.)
  • GAAP net income available to common stockholders was $25.2 million for the first quarter of 2016, or earnings per diluted share of $1.37.  This compares to net income available to common stockholders of$28.0 million, or earnings per diluted share of $1.47, for the first quarter of 2015.  The decline was primarily due to the expected increase in general and administrative expenses and the impact on gross profit from the sale of the remaining Applebee's company-operated restaurants in the third quarter of 2015.  These items were partially offset by fewer weighted average shares outstanding and a decline in closure and impairment charges.
  • General and administrative expenses were $39.4 million for the first quarter of 2016.  This compares to $34.2 million for the same period of 2015.  The expected increase was mainly due to $2.1 million of non-recurring costs associated with the consolidation of our restaurant support center announced on September 3, 2015, higher personnel costs and an increase in costs for travel in the first quarter of 2016 compared to the first quarter of 2015.        

Same-Restaurant Sales Performance

First Quarter of Fiscal 2016

  • IHOP's domestic system-wide same restaurant sales increased 1.5% for the first quarter of 2016 compared to the same period in 2015. 
  • Applebee's domestic system-wide same-restaurant sales decreased 3.7% for the first quarter of 2016 compared to the first quarter of 2015.

Financial Performance Guidance for Fiscal 2016

DineEquity reiterates its financial performance guidance for fiscal 2016 contained in the press release issued on February 24, 2016. 

Investor Conference Call Today

DineEquity will host a conference call to discuss its results on the same day at 11:00 a.m. Eastern Time/ 8:00 a.m. Pacific Time.  To participate on the call, please dial (888) 771-4371 and reference passcode 42367792. International callers, please dial (847) 585-4405 and reference passcode 42367792.

A live webcast of the call will be available on DineEquity's Web site at www.dineequity.com and may be accessed by visiting Calls & Presentations under the site's Investors section.  Participants should allow approximately ten minutes prior to the call's start time to visit the site and download any streaming media software needed to listen to the webcast.  A telephonic replay of the call may be accessed from 10:30 a.m. Pacific Time on May 5, 2016 through 8:59 p.m. Pacific Time on May 12, 2016 by dialing (888) 843-7419 and referencing passcode 42367792#.  International callers, please dial (630) 652-3042 and reference passcode 42367792#.  An online archive of the webcast will also be available on Calls & Presentations under the Investors section of DineEquity's Web site.

About DineEquity, Inc.

Based in Glendale, California, DineEquity, Inc., through its subsidiaries, franchises and operates restaurants under the Applebee's Neighborhood Grill & Bar and IHOP brands. With more than 3,700 restaurants combined in 20 countries and U.S. territories and over 400 franchisees, DineEquity is one of the largest full-service restaurant companies in the world. For more information on DineEquity, visit the Company's Web site located at www.dineequity.com.

Forward-Looking Statements

Statements contained in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by words such as "may," "will," "should," "expect," "anticipate," "believe," "estimate," "intend," "plan" and other similar expressions. These statements involve known and unknown risks, uncertainties and other factors, which may cause actual results to be materially different from those expressed or implied in such statements. These factors include, but are not limited to: the effect of general economic conditions; the Company's indebtedness; risk of future impairment charges; trading volatility and the price of the Company's common stock; the Company's results in any given period differing from guidance provided to the public; the highly competitive nature of the restaurant business; the Company's business strategy failing to achieve anticipated results; risks associated with the restaurant industry; risks associated with locations of current and future restaurants; rising costs for food commodities and utilities; shortages or interruptions in the supply or delivery of food; ineffective marketing and guest relationship initiatives and use of social media; changing health or dietary preferences; our engagement in business in foreign markets; harm to our brands' reputation; litigation; fourth-party claims with respect to intellectual property assets; environmental liability; liability relating to employees; failure to comply with applicable laws and regulations; failure to effectively implement restaurant development plans; our dependence upon our franchisees; concentration of Applebee's franchised restaurants in a limited number of franchisees; credit risk from IHOP franchisees operating under our previous business model; termination or non-renewal of franchise agreements; franchisees breaching their franchise agreements; insolvency proceedings involving franchisees; changes in the number and quality of franchisees; inability of franchisees to fund capital expenditures; heavy dependence on information technology; the occurrence of cyber incidents or a deficiency in our cybersecurity; failure to execute on a business continuity plan; inability to attract and retain talented employees; risks associated with retail brand initiatives; failure of our internal controls; and other factors discussed from time to time in the Company's Annual and Quarterly Reports on Forms 10-K and 10-Q and in the Company's other filings with the Securities and Exchange Commission. The forward-looking statements contained in this release are made as of the date hereof and the Company assumes no obligation to update or supplement any forward-looking statements.

Non-GAAP Financial Measures

This news release includes references to the Company's non-GAAP financial measures "adjusted net income available to common stockholders (adjusted EPS)," "free cash flow," and "segment EBITDA."  "Adjusted EPS" is computed for a given period by deducting from net income or loss available to common stockholders for such period the effect of any closure and impairment charges, any gain or loss related to debt extinguishment, any intangible asset amortization, any non-cash interest expense, any gain or loss related to the disposition of assets, and other items deemed not reflective of current operations.  This is presented on an aggregate basis and a per share (diluted) basis.  "Free cash flow" for a given period is defined as cash provided by operating activities, plus receipts from notes and equipment contracts receivable, less capital expenditures.  Management utilizes free cash flow to determine the amount of cash remaining for general corporate and strategic purposes and for the return of cash to stockholders pursuant to our capital allocation strategy, after the receipts from notes and equipment contracts receivable, and the funding of operating activities, capital expenditures and debt service. Management believes this information is helpful to investors to determine the Company's adherence to debt covenants and the Company's cash available for these purposes. Adjusted EPS and free cash flow are supplemental non-GAAP financial measures and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with United States generally accepted accounting principles.

 

DineEquity, Inc. and Subsidiaries
Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)

 
   

Three Months Ended

   

March 31,

   

2016

 

2015

Revenues:

       

Franchise and restaurant revenues

 

$

129,786

   

$

141,818

 

Rental revenues

 

31,409

   

31,402

 

Financing revenues

 

2,329

   

2,594

 

Total revenues

 

163,524

   

175,814

 

Cost of revenues:

       

Franchise and restaurant expenses

 

40,869

   

52,026

 

Rental expenses

 

23,231

   

23,490

 

Financing expenses

 

   

12

 

Total cost of revenues

 

64,100

   

75,528

 

Gross profit

 

99,424

   

100,286

 

General and administrative expenses

 

39,424

   

34,230

 

Interest expense

 

15,366

   

15,646

 

Amortization of intangible assets

 

2,480

   

2,500

 

Closure and impairment charges, net

 

435

   

1,827

 

Loss (gain) on disposition of assets

 

614

   

(9)

 

Income before income tax provision

 

41,105

   

46,092

 

Income tax provision

 

(15,562)

   

(17,680)

 

Net income

 

$

25,543

   

$

28,412

 

Net income available to common stockholders:

       

Net income

 

$

25,543

   

$

28,412

 

Less: Net income allocated to unvested participating restricted stock

 

(382)

   

(372)

 

Net income available to common stockholders

 

$

25,161

   

$

28,040

 
         

Net income available to common stockholders per share:

       

Basic

 

$

1.38

   

$

1.49

 

Diluted

 

$

1.37

   

$

1.47

 

Weighted average shares outstanding:

       

Basic

 

18,260

   

18,870

 

Diluted

 

18,373

   

19,019

 
         

Dividends declared per common share

 

$

0.92

   

$

0.875

 

Dividends paid per common share

 

$

0.92

   

$

0.875

 

 

 

DineEquity, Inc. and Subsidiaries

Consolidated Balance Sheets

(In thousands, except share and per share amounts)

 
   

March 31,

 2016

 

December 31, 2015

   

(Unaudited)

   

Assets

       

Current assets:

       

Cash and cash equivalents

 

$

140,330

   

$

144,785

 

Receivables, net

 

97,871

   

139,206

 

Restricted cash

 

36,927

   

32,528

 

Prepaid gift card costs

 

37,202

   

46,792

 

Prepaid income taxes

 

   

5,186

 

Other current assets

 

4,737

   

4,212

 

Total current assets

 

317,067

   

372,709

 

Long-term receivables, net

 

155,360

   

160,695

 

Property and equipment, net

 

214,206

   

219,580

 

Goodwill

 

697,470

   

697,470

 

Other intangible assets, net

 

770,447

   

772,949

 

Deferred rent receivable

 

89,438

   

90,030

 

Other non-current assets, net

 

18,204

   

18,417

 

Total assets

 

$

2,262,192

   

$

2,331,850

 
         

Liabilities and Stockholders' Equity

       

Current liabilities:

       

Accounts payable

 

$

34,438

   

$

55,019

 

Gift card liability

 

119,162

   

167,657

 

Accrued employee compensation and benefits

 

14,140

   

25,085

 

Dividends payable

 

17,011

   

17,082

 

Income taxes payable

 

14,258

   

 

Current maturities of capital lease and financing obligations

 

14,447

   

14,320

 

Accrued advertising

 

16,209

   

8,758

 

Accrued interest payable

 

4,287

   

4,257

 

Other accrued expenses

 

12,078

   

6,251

 

Total current liabilities

 

246,030

   

298,429

 

Long-term debt, net

 

1,280,264

   

1,279,473

 

Capital lease obligations, less current maturities

 

81,143

   

84,781

 

Financing obligations, less current maturities

 

42,360

   

42,395

 

Deferred income taxes, net

 

262,004

   

269,469

 

Deferred rent payable

 

68,817

   

69,397

 

Other non-current liabilities

 

21,269

   

20,683

 

Total liabilities

 

2,001,887

   

2,064,627

 

Commitments and contingencies

       

Stockholders' equity:

       

Common stock, $0.01 par value, shares: 40,000,000 authorized; March 31, 2016 - 25,166,732 issued, 18,409,845 outstanding; December 31, 2015 - 25,186,048 issued, 18,535,027 outstanding

 

252

   

252

 

Additional paid-in-capital

 

287,601

   

286,952

 

Retained earnings

 

360,483

   

351,923

 

Accumulated other comprehensive loss

 

(106)

   

(107)

 

Treasury stock, at cost; shares: March 31, 2016 - 6,756,887; December 31, 2015 - 6,651,021

 

(387,925)

   

(371,797)

 

Total stockholders' equity

 

260,305

   

267,223

 

Total liabilities and stockholders' equity

 

$

2,262,192

   

$

2,331,850

 

 

 

DineEquity, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 
   

Three Months Ended

   

March 31,

   

2016

 

2015

Cash flows from operating activities:

       

Net income

 

$

25,543

   

$

28,412

 

Adjustments to reconcile net income to cash flows provided by operating activities:

       

Depreciation and amortization

 

8,074

   

7,815

 

Non-cash interest expense

 

791

   

755

 

Deferred income taxes

 

(4,700)

   

(6,702)

 

Non-cash stock-based compensation expense

 

3,192

   

2,432

 

Tax benefit from stock-based compensation

 

2,537

   

4,696

 

Excess tax benefit from stock-based compensation

 

(862)

   

(4,526)

 

Closure and impairment charges

 

435

   

1,827

 

Loss (gain) on disposition of assets

 

614

   

(9)

 

Other

 

1,048

   

31

 

Changes in operating assets and liabilities:

       

Accounts receivable, net

 

116

   

(2,742)

 

Current income tax receivables and payables

 

16,918

   

18,665

 

Gift card receivables and payables

 

(12,820)

   

5,623

 

Other current assets

 

(520)

   

(1,638)

 

Accounts payable

 

(5,069)

   

1,034

 

Accrued employee compensation and benefits

 

(10,945)

   

(14,810)

 

Accrued interest payable

 

30

   

(10,229)

 

Other current liabilities

 

13,112

   

10,496

 

Cash flows provided by operating activities

 

37,494

   

41,130

 

Cash flows from investing activities:

       

Additions to property and equipment

 

(839)

   

(2,617)

 

Principal receipts from notes, equipment contracts and other long-term receivables

 

4,206

   

4,442

 

Other

 

(105)

   

(40)

 

Cash flows provided by investing activities

 

3,262

   

1,785

 

Cash flows from financing activities:

       

Principal payments on capital lease and financing obligations

 

(3,385)

   

(3,165)

 

Repurchase of common stock

 

(20,004)

   

(15,003)

 

Dividends paid on common stock

 

(17,049)

   

(16,598)

 

Tax payments for restricted stock upon vesting

 

(2,116)

   

(2,961)

 

Proceeds from stock options exercised

 

880

   

8,206

 

Excess tax benefit from stock-based compensation

 

862

   

4,526

 

Change in restricted cash

 

(4,399)

   

11,561

 

Other

 

   

(15)

 

Cash flows used in financing activities

 

(45,211)

   

(13,449)

 

Net change in cash and cash equivalents

 

(4,455)

   

29,466

 

Cash and cash equivalents at beginning of period

 

144,785

   

104,004

 

Cash and cash equivalents at end of period

 

$

140,330

   

$

133,470

 

 

 

NON-GAAP FINANCIAL MEASURES

(In thousands, except per share amounts)

(Unaudited)

 

Reconciliation of net income available to common stockholders to net income available to common stockholders, as adjusted for the following items: Kansas City Support Center consolidation costs; amortization of intangible assets; closure and impairment charges; non-cash interest expense; gain or loss on disposition of assets; and the combined tax effect of the preceding adjustments, as well as related per share data:

 
   

Three Months Ended

   

March 31,

   

2016

 

2015

Net income available to common stockholders, as reported

 

$

25,161

   

$

28,040

 

Kansas City Support Center consolidation costs

 

2,066

   

 

Amortization of intangible assets

 

2,480

   

2,500

 

Closure and impairment charges

 

435

   

1,827

 

Non-cash interest expense

 

791

   

755

 

Loss (gain) on disposition of assets

 

614

   

(9)

 

Income tax provision

 

(2,427)

   

(1,928)

 

Net income allocated to unvested participating restricted stock

 

(61)

   

(43)

 

Net income available to common stockholders, as adjusted

 

$

29,059

   

$

31,142

 
         

Diluted net income available to common stockholders per share:

       

Net income available to common stockholders, as reported

 

$

1.37

   

$

1.47

 

Kansas City Support Center consolidation costs

 

0.07

   

 

Amortization of intangible assets

 

0.08

   

0.08

 

Closure and impairment charges

 

0.01

   

0.06

 

Non-cash interest expense

 

0.03

   

0.02

 

Loss (gain) on disposition of assets

 

 

0.02

   

(0.00)

 

Net income allocated to unvested participating restricted stock

 

(0.00)

   

(0.00)

 

Rounding

 

   

0.01

 

Diluted net income available to common stockholders per share, as adjusted

 

$

1.58

   

$

1.64

 
         

Numerator for basic EPS-income available to common stockholders, as adjusted

 

$

29,059

   

$

31,142

 

Effect of unvested participating restricted stock using the two-class method

 

1

   

 

Numerator for diluted EPS-income available to common stockholders after assumed conversions, as adjusted

 

$

29,060

   

$

31,142

 
         

Denominator for basic EPS-weighted-average shares

 

18,260

   

18,870

 

Dilutive effect of stock options

 

113

   

149

 

Denominator for diluted EPS-weighted-average shares and assumed conversions

 

18,373

   

19,019

 

 

 

DineEquity, Inc. and Subsidiaries

Non-GAAP Financial Measures

(Unaudited)

 

Reconciliation of the Company's cash provided by operating activities to "free cash flow" (cash provided by operating activities, plus receipts from notes and equipment contracts receivable, less additions to property and equipment). We believe this information is helpful to investors to determine our cash available for general corporate purposes and for the return of cash to stockholders pursuant to our capital allocation strategy, and is the same measure used by management for these purposes.

 
   

Three Months Ended

   

March 31,

   

2016

 

2015

   

(In millions)

Cash flows provided by operating activities

 

$

37.5

   

$

41.1

 

Receipts from notes and equipment contracts receivable

 

2.1

   

2.6

 

Additions to property and equipment

 

(0.8)

   

(2.6)

 

Free cash flow

 

38.8

   

41.1

 

Dividends paid on common stock

 

(17.0)

   

(16.6)

 

Repurchase of DineEquity common stock

 

(20.0)

   

(15.0)

 
   

$

1.8

   

$

9.5

 

 

 

DineEquity, Inc. and Subsidiaries

Non-GAAP Financial Measures

(In thousands)

(Unaudited)

 

Reconciliation of U.S. GAAP gross profit to segment EBITDA:

 
   

Three months ended March 31, 2016

   

Franchise - Applebee's

 

Franchise - IHOP

 

Company Restaurants

 

Rental Operations

 

Financing Operations

 

Total

Revenue

 

$

51,085

   

$

73,889

   

$

4,812

   

$

31,409

   

$

2,329

   

$

163,524

 

Expense

 

1,885

   

33,772

   

5,212

   

23,231

   

   

64,100

 

Gross profit

 

49,200

   

40,117

   

(400)

   

8,178

   

2,329

   

99,424

 

Plus:

                       

Depreciation/amortization

 

2,596

   

   

111

   

3,142

   

   

5,849

 

Interest charges

 

   

   

96

   

3,110

   

   

3,206

 

Segment EBITDA

 

$

51,796

   

$

40,117

   

$

(193)

   

$

14,430

   

$

2,329

   

$

108,479

 
 
   

Three months ended March 31, 2015

   

Franchise - Applebee's

 

Franchise - IHOP

 

Company Restaurants

 

Rental Operations

 

Financing Operations

 

Total

Revenue

 

$

52,431

   

$

72,111

   

$

17,276

   

$

31,402

   

$

2,594

   

$

175,814

 

Expense

 

1,596

   

33,921

   

16,509

   

23,490

   

12

   

75,528

 

Gross profit

 

50,835

   

38,190

   

767

   

7,912

   

2,582

   

100,286

 

Plus:

                       

Depreciation/amortization

 

2,592

   

   

189

   

3,224

   

   

6,005

 

Interest charges

 

   

   

99

   

3,501

   

   

3,600

 

Segment EBITDA

 

$

53,427

   

$

38,190

   

$

1,055

   

$

14,637

   

$

2,582

   

$

109,891

 

 

Restaurant Data

The following table sets forth, for the three months ended March 31, 2016 and 2015, the number of "Effective Restaurants" in the Applebee's and IHOP systems and information regarding the percentage change in sales at those restaurants compared to the same periods in the prior year. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. However, we believe that presentation of this information is useful in analyzing our revenues because franchisees and area licensees pay us royalties and advertising fees that are generally based on a percentage of their sales, and, where applicable, rental payments under leases that  may be partially based on a percentage of their sales. Management also uses this information to make decisions about future plans for the development of additional restaurants as well as evaluation of current operations.

 
   

Three Months Ended

     

March 31,

   

2016

 

2015

   

(unaudited)

Applebee's Restaurant Data

       

Effective Restaurants(a)

       

Franchise

 

2,030

   

1,992

 

Company

 

   

23

 

Total

 

2,030

   

2,015

 
         

System-wide(b)

       

Sales percentage change(c)

 

(4.0)

%

 

3.6

%

Domestic same-restaurant sales percentage change(d)

 

(3.7)

%

 

2.9

%

         

Franchise(b)

       

Sales percentage change(c)

 

(3.0)

%

 

3.6

%

Domestic same-restaurant sales percentage change(d)

 

(3.7)

%

 

2.9

%

Average weekly domestic unit sales (in thousands)

 

$

48.7

   

$

51.1

 
                   
     
   

Three Months Ended

     

March 31,

   

2016

 

2015

   

(unaudited)

IHOP Restaurant Data

       

Effective Restaurants(a)

       

Franchise

 

1,507

   

1,470

 

Area license

 

165

   

167

 

Company

 

11

   

12

 

Total

 

1,683

   

1,649

 
         

System-wide(b)

       

Sales percentage change(c)

 

2.2

%

 

6.2

%

Domestic same-restaurant sales percentage change(d)

 

1.5

%

 

4.8

%

         

Franchise(b)

       

Sales percentage change(c)

 

2.5

%

 

6.0

%

Domestic same-restaurant sales percentage change(d)

 

1.4

%

 

4.8

%

Average weekly domestic unit sales (in thousands)

 

$

37.7

   

$

37.7

 
         

Area License (b)

       

Sales percentage change(c)

 

0.4

%

 

7.0

%

                   

 

   

(a) 

"Effective Restaurants" are the weighted average number of restaurants open in a given fiscal period, adjusted to account for restaurants open for only a portion of the period. Information is presented for all Effective Restaurants in the Applebee's and IHOP systems, which includes restaurants owned by franchisees and area licensees as well as those owned by the Company.

(b)

"System-wide" sales are retail sales at Applebee's restaurants operated by franchisees and IHOP restaurants operated by franchisees and area licensees, as reported to the Company, in addition to retail sales at company-operated restaurants.  Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. Unaudited reported sales for Applebee's domestic franchise restaurants, IHOP franchise restaurants and IHOP area license restaurants for the three months ended March 31, 2016 and 2015 were as follows:

 

   

Three Months Ended

   

March 31,

   

2016

 

2015

 

(In millions)

Reported sales (unaudited)

       

Applebee's domestic franchise restaurant sales

 

$

1,189.0

   

$

1,226.0

 

IHOP franchise restaurant sales

 

738.9

   

$

721.2

 

IHOP area license restaurant sales

 

75.3

   

$

75.0

 

Total

 

$

2,003.2

   

$

2,022.2

 

 

   

(c) 

"Sales percentage change" reflects, for each category of restaurants, the percentage change in sales in any given fiscal period compared to the prior fiscal period for all restaurants in that category.

(d)

"Domestic same-restaurant sales percentage change" reflects the percentage change in sales, in any given fiscal period, compared to the same weeks in the prior year for domestic restaurants that have been operated throughout both fiscal periods that are being compared and have been open for at least 18 months. Because of new unit openings and restaurant closures, the domestic restaurants open throughout both fiscal periods being compared may be different from period to period. Same-restaurant sales percentage change does not include data on IHOP area license restaurants located in Florida.

 

 

DineEquity, Inc. and Subsidiaries
Restaurant Data

 (unaudited)

 

The following table summarizes our restaurant development activity:

 
   

Three Months Ended

   

March 31,

   

2016

 

2015

Applebee's Restaurant Development Activity

       

Summary - beginning of period:

       

Franchise

 

2,033

   

1,994

 

Company restaurants

 

   

23

 

 Total Applebee's restaurants, beginning of period

 

2,033

   

2,017

 

Franchise restaurants opened:

       

Domestic

 

5

   

4

 

International

 

1

   

2

 

Total franchise restaurants opened

 

6

   

6

 

Franchise restaurants closed:

       

Domestic

 

(6)

   

(4)

 

International

 

(4)

   

(5)

 

Total franchise restaurants closed

 

(10)

   

(9)

 

Net franchise restaurant (reduction) development

 

(4)

   

(3)

 

Summary - end of period:

       

Franchise

 

2,029

   

1,991

 

Company restaurants

 

   

23

 

Total Applebee's restaurants, end of period

 

2,029

   

2,014

 
   

IHOP Restaurant Development Activity

       

Summary - beginning of period:

       

Franchise

 

1,507

   

1,472

 

Area license

 

165

   

167

 

Company

 

11

   

11

 

Total IHOP restaurants, beginning of period

 

1,683

   

1,650

 

Franchise/area license restaurants opened:

       

Domestic franchise

 

6

   

6

 

Domestic area license

 

   

1

 

International franchise

 

1

   

 

Total franchise/area license restaurants opened

 

7

   

7

 

Franchise/area license restaurants closed:

       

Domestic franchise

 

(3)

   

(6)

 

Domestic area license

 

(1)

   

(1)

 

International franchise

 

(2)

   

 

Total franchise/area license restaurants closed

 

(6)

   

(7)

 

Net franchise/area license restaurant development

 

1

   

 

Refranchised from Company restaurants

 

   

1

 

Franchise restaurants reacquired by the Company

 

   

(3)

 

Net franchise/area license restaurant additions (reductions)

 

1

   

(2)

 

Summary - end of period

       

Franchise

 

1,509

   

1,470

 

Area license

 

164

   

167

 

Company

 

11

   

13

 

Total IHOP restaurants, end of period

 

1,684

   

1,650

 

SOURCE DineEquity, Inc.

Contacts:

Ken Diptee
Investor Relations
Executive Director
818-637-3632

Patrick Lenow
Media Relations
Vice President, Communications
DineEquity, Inc.
818-637-3122

###

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