Papa John’s Announces Second Quarter 2021 Financial Results And Significant Increase In Dividend
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Papa John’s Announces Second Quarter 2021 Financial Results And Significant Increase In Dividend

LOUISVILLE, Ky. - (BUSINESS WIRE) - Aug. 5, 2021 - Papa John’s International, Inc. (NASDAQ: PZZA) today announced financial results for the three and six months ended June 27, 2021.

Second quarter 2021 highlights compared to prior year

  • Total company revenues increased 11.8% to $515.0 million
  • Comparable sales up 5.2% in North America and 21.2% Internationally; Global system-wide restaurant sales of $1.2 billion, up 12.2% driven by innovation, strong customer retention and accelerating domestic and international unit growth
  • 55 net unit openings driven by International growth
  • Loss per diluted share of ($2.30), including Special items of $3.23 per share, largely related to repurchase and conversion of Series B Convertible Preferred Stock; Adjusted earnings per diluted share grew to $0.93 from $0.48 a year ago
  • For first six months of 2021, cash flow from operations of $128.0 million, up from $87.7 million a year ago; free cash flow of $100.1 million up from $67.0 million
  • Increases return to common shareholders with 56% increase in annual dividend rate to $1.40 per share; declares third quarter dividend of $0.35 per share

“Papa John’s delivered an eighth consecutive quarter of growth, with system-wide sales up 12% in Q2. We extended the record sales results we achieved a year ago, sustaining our industry outperformance as markets continue reopening,” said President & CEO Rob Lynch. “Robust two-year comparable sales results – up 33% in North America and 27% internationally – reflect the impact our multi-faceted innovation strategy has had across every area of our business, powered by the effort of our team members and franchisees.”

Mr. Lynch continued, “Papa John’s strong brand and highly-attractive unit economics are driving accelerated restaurant openings by both new and existing franchisees, resulting in a record 123 net unit openings in the first half of 2021. In addition to growing AUVs, development is now a significant component of rising system-wide sales. With our business firing on all cylinders, we are more confident than ever that Papa John’s strategy and growth model position us solidly for long-term growth, as we build the world’s best pizza delivery company.”

Financial Highlights

   

Three Months Ended

 

Six Months Ended

In thousands, except per share amounts  

June 27,
2021

 

June 28,
2020

 

Increase
(Decrease)

 

June 27,
2021

 

June 28,
2020

 

Increase
(Decrease)

                         
Revenue  

$

515,008

 

 

$

460,623

 

$

54,385

 

 

$

1,026,754

 

 

$

870,482

 

$

156,272

 

Operating income  

 

44,637

 

 

 

30,534

 

 

14,103

 

 

 

91,499

 

 

 

46,006

 

 

45,493

 

Net income  

 

32,254

 

 

 

20,614

 

 

11,640

 

 

 

66,137

 

 

 

29,057

 

 

37,080

 

Diluted (loss) earnings per share  

 

(2.30

)

 

 

0.48

 

 

(2.78

)

 

 

(1.47

)

 

 

0.65

 

 

(2.12

)

Adjusted diluted earnings per share (a)  

 

0.93

 

 

 

0.48

 

 

0.45

 

 

 

1.94

 

 

 

0.65

 

 

1.29

 

(a)

 

Adjusted diluted earnings per share is a non-GAAP measure that excludes “Special items,” which impact comparability. Special items of $112.4 million and $115.4 million for the three and six months ended June 27, 2021 include $109.9 million of a one-time charge in each period associated with the repurchase and conversion of all shares of the company’s Series B Convertible Preferred Stock (“Series B Preferred Stock”) and $3.3 million and $7.2 million for the three and six month ended June 27, 2021, respectively, of strategic corporate reorganization costs associated with the company’s new office in Atlanta, Georgia projected to open in the fall of 2021. The reconciliation of GAAP to non-GAAP financial results is included in “Reconciliation of Non-GAAP Financial Measures” below.

Revenues

Consolidated revenues of $515.0 million increased $54.4 million, or 11.8%, in the second quarter of 2021 compared to the second quarter of 2020 primarily as a result of higher comparable sales of 5.2% for North America restaurants, which benefited from continued menu, delivery and digital innovation as reflected in higher company-owned restaurant revenues, franchise royalties and commissary sales. Higher commodity costs also positively impacted commissary sales. International revenues also increased primarily due to higher royalties from strong comparable sales results of 21.2% for the quarter and higher unit counts.

Operating Results

Consolidated operating income of $44.6 million for the second quarter of 2021 increased $14.1 million compared to the second quarter of 2020. The increase primarily reflects strong sales on higher comparable sales and year-over-year unit growth domestically and internationally. Additionally, the second quarter of 2021 benefited from a higher effective royalty rate and additional franchise royalties of $5.1 million compared to the comparable period in 2020 primarily as a result of ending in the third quarter of 2020 our temporary franchise support program.

Diluted loss per share was $2.30 for the second quarter of 2021 representing a decrease of $2.78 over the second quarter of 2020. Diluted loss per share included $3.15 per diluted share in the second quarter of 2021 from a reduction in net income attributable to common shareholders related to the repurchase and conversion of all shares of Series B Preferred Stock. This charge reflects the excess of the one-time cash payment over the carrying value of the Series B Preferred Stock. Excluding the impact of Special items, adjusted diluted earnings per share was $0.93 representing an increase of $0.45 over the second quarter of 2020.

Global Restaurant Sales Information

Global restaurant and comparable sales information for the three and six months ended June 27, 2021, compared to the three and six months ended June 28, 2020 are as follows (See “Supplemental Information and Financial Statements” below for related definitions):

    Three Months Ended   Six Months Ended
    June 27,
2021
  June 28,
2020
  June 27,
2021
  June 28,
2020
Comparable sales growth:                
Domestic company-owned restaurants  

5.6%

 

22.6%

 

13.8%

 

14.4%

North America franchised restaurants  

5.2%

 

29.7%

 

15.1%

 

17.2%

North America restaurants  

5.2%

 

28.0%

 

14.8%

 

16.6%

International restaurants  

21.2%

 

5.3%

 

22.2%

 

3.8%

Total comparable sales growth  

9.0%

 

22.2%

 

16.6%

 

13.3%

                 
System-wide restaurant sales growth:                
(excluding the impact of foreign currency)                
Domestic company-owned restaurants  

5.2%

 

13.9%

 

13.1%

 

6.9%

North America franchised restaurants  

6.4%

 

29.4%

 

15.8%

 

17.5%

North America restaurants  

6.2%

 

25.7%

 

15.2%

 

15.0%

International restaurants  

35.7%

 

5.5%

 

32.2%

 

6.8%

Total global system-wide restaurant sales growth  

12.2%

 

20.8%

 

19.0%

 

13.0%

Global Restaurant Unit Data

As of June 27, 2021, there were 5,523 Papa John’s restaurants operating in 49 countries and territories, as follows:

   

Domestic
Company-
owned

 

Franchised
North
America

 

Total North
America

 

International

 

System-wide

Second Quarter                    
Beginning - March 28, 2021  

589

 

 

2,709

 

 

3,298

 

 

2,170

 

 

5,468

 

Opened  

-

 

 

24

 

 

24

 

 

71

 

 

95

 

Closed  

-

 

 

(13

)

 

(13

)

 

(27

)

 

(40

)

Ending - June 27, 2021  

589

 

 

2,720

 

 

3,309

 

 

2,214

 

 

5,523

 

Net unit growth  

-

 

 

11

 

 

11

 

 

44

 

 

55

 

Trailing four quarters net store (decline)/growth  

(9

)

 

34

 

 

25

 

 

151

 

 

176

 

 

Free Cash Flow

The company’s free cash flow (a non-GAAP financial measure defined as net cash provided by operating activities, less purchases of property and equipment and dividends paid to preferred shareholders) for the six months ended 2021 and 2020, respectively, was as follows (in thousands):

   

Six Months Ended

   

June 27,

 

June 28,

   

 

2021

 

 

 

2020

 

         
Net cash provided by operating activities  

$

128,030

 

 

$

87,658

 

Purchases of property and equipment  

 

(21,543

)

 

 

(13,795

)

Dividends paid to preferred shareholders (1)  

 

(6,394

)

 

 

(6,825

)

Free cash flow  

$

100,093

 

 

$

67,038

 

(1)

 

This does not include the cash consideration paid for the repurchase and conversion of the Series B Preferred Stock. See “Repurchase and Conversion of Series B Preferred Stock” below for additional information.

We view free cash flow as an important financial measure because it is one factor that management uses in determining the amount of cash available for discretionary investment. Free cash flow is not a term defined by GAAP, and as a result, our measure of free cash flow might not be comparable to similarly titled measures used by other companies. Free cash flow should not be construed as a substitute for or a better indicator of the company’s performance than the company’s GAAP measures.

See the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of our Quarterly Report on Form 10-Q filed with the SEC for additional information concerning our operating results for the three and six months and cash flow for the six months ended June 27, 2021.

Repurchase and Conversion of Series B Preferred Stock

On May 13, 2021, the company completed the previously announced repurchase and conversion to common stock of all of the shares of Series B Preferred Stock owned by affiliates of Starboard Value LP. Additionally, on June 7, 2021, all of the remaining outstanding shares of the Series B Preferred Stock, owned by certain franchisee investors, were repurchased or converted to common stock. Collectively, these actions were taken in return for cash payments of $188.6 million. The company also recorded a reduction to net income attributable to common shareholders of $109.9 million as a result of the transaction. This one-time charge to equity reflects the excess of the cash payments over the carrying value of the respective Series B Preferred Stock. Following these transactions, there was no Series B Preferred Stock outstanding as of the end of the quarter.

Cash Dividend

The company paid common and preferred stock dividends of $10.4 million in the second quarter of 2021. On August 3, 2021, our Board of Directors approved a 55.6% increase in the company's dividend rate per common share, from $0.90 on an annual basis to $1.40 on an annual basis, and subsequently declared a third quarter dividend of $0.35 per common share, of which approximately $12.8 million will be paid to common stockholders. The common share dividend will be paid on August 27, 2021 to stockholders of record as of the close of business on August 16, 2021. The declaration and payment of any future dividends will be at the discretion of our Board of Directors.

Conference Call

A conference call is scheduled for August 5, 2021 at 8:00 a.m. Eastern Time to review the company’s second quarter 2021 earnings results.

Forward-Looking Statements 

Certain matters discussed in this press release and other company communications that are not statements of historical fact constitute forward-looking statements within the meaning of the federal securities laws. Generally, the use of words such as “expect,” “intend,” “estimate,” “believe,” “anticipate,” “will,” “forecast,” “plan,” “project,” or similar words identify forward-looking statements that we intend to be included within the safe harbor protections provided by the federal securities laws. Such forward-looking statements include or may relate to projections or guidance concerning business performance, revenue, earnings, cash flow, earnings per share, share repurchases, the financial impact of the temporary business opportunities, disruptions and temporary changes in demand we are experiencing related to the current outbreak of the novel coronavirus disease (COVID-19), commodity costs, currency fluctuations, profit margins, unit growth, unit level performance, capital expenditures, restaurant and franchise development, the duration of changes in consumer behavior caused by the pandemic, our plans to open a new office in Atlanta, the associated reorganization costs and the related organizational, employment and real estate changes that are expected, royalty relief, the effectiveness of our menu innovations and other business initiatives, marketing efforts, liquidity, compliance with debt covenants, strategic decisions and actions, dividends, effective tax rates, regulatory changes and impacts, adoption of new accounting standards, and other financial and operational measures. Such statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict and many of which are beyond our control.

Our forward-looking statements are based on our assumptions which are based on currently available information, including assumptions about our ability to manage difficulties and opportunities associated with or related to the COVID-19 pandemic, including risks related to: the impact of governmental restrictions on freedom of movement and business operations including quarantines, social distancing requirements and mandatory business closures; changes in consumer demand or behavior; labor shortages at company and/or franchised stores; impact of delayed new store openings, both domestically and internationally; the overall contraction in global economic activity, including increased unemployment; our ability to navigate changing governmental programs and regulations relating to the pandemic; the increased risk of phishing and other cyber-attacks; and our ability to successfully implement or fully realize the anticipated benefits of our corporate reorganization and new office in Atlanta, Georgia and corporate reorganization in the timeframes we desire or within the expected range of expenses, or at all. In addition, turnover in our support teams due to our relocations to Georgia could distract our employees, decrease employee morale, harm our reputation, and negatively impact the overall performance of our corporate support teams. Actual outcomes and results may differ materially from those matters expressed or implied in such forward-looking statements. These and other risks, uncertainties and assumptions that are involved in our forward-looking statements are discussed in detail in “Part I. Item 1A. – Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 27, 2020. We undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise, except as required by law.

Supplemental Information and Financial Statements

Definition 

“Comparable sales” represents the change in year-over-year sales for the same base of restaurants for the same fiscal periods. “Global system-wide restaurant sales” represents total restaurant sales for all company-owned and franchised stores open during the comparable periods, and “Global system-wide restaurant sales growth” represents the change in such sales year-over-year. We believe North America, international and global restaurant and comparable sales growth and Global system-wide restaurant sales information is useful in analyzing our results since our franchisees pay royalties and marketing fund contributions that are based on a percentage of franchise sales. Comparable sales and Global system-wide restaurant sales results for restaurants operating outside of the United States are reported on a constant dollar basis, which excludes the impact of foreign currency translation. Franchise sales also generate commissary revenue in the United States and in certain international markets. Franchise restaurant and comparable sales growth information is also useful for comparison to industry trends and evaluating the strength of our brand. Management believes the presentation of franchise restaurant sales growth, excluding the impact of foreign currency, provides investors with useful information regarding underlying sales trends and the impact of new unit growth without being impacted by swings in the external factor of foreign currency. Franchise restaurant sales are not included in the company’s revenues.

Reconciliation of Non-GAAP Financial Measures

The table below reconciles our GAAP financial results to our adjusted financial results, which are non-GAAP measures. The non-GAAP adjusted results shown below and within this press release, which exclude the items in the table below (collectively defined as “Special items”), should not be construed as a substitute for or a better indicator of the company’s performance than the company’s GAAP results. Management believes presenting certain financial information excluding the Special items is important for purposes of comparison to current year results. In addition, management uses these metrics to evaluate the company’s underlying operating performance and to analyze trends.

   

Three Months Ended

 

Six Months Ended

   

June 27,

 

June 28,

 

June 27,

 

June 28,

(In thousands, except per share amounts)  

 

2021

 

 

2020

 

 

2021

 

 

2020

                 
GAAP operating income  

$

44,637

 

 

$

30,534

 

$

91,499

 

 

$

46,006

Strategic corporate reorganization costs (1)  

 

3,328

 

 

 

-

 

 

7,211

 

 

 

-

Adjusted operating income  

$

47,965

 

 

$

30,534

 

$

98,710

 

 

$

46,006

                 
GAAP net (loss)/income attributable to common shareholders  

$

(79,898

)

 

$

15,707

 

$

(49,542

)

 

$

20,933

Strategic corporate reorganization costs (1)  

 

3,328

 

 

 

-

 

 

7,211

 

 

 

-

Repurchase and conversion of Series B Preferred Stock (2)  

 

109,852

 

 

 

-

 

 

109,852

 

 

 

-

Tax effect of strategic corporate reorganization costs (3)  

 

(745

)

 

 

-

 

 

(1,615

)

 

 

-

Adjusted net income attributable to common shareholders  

$

32,537

 

 

$

15,707

 

$

65,906

 

 

$

20,933

                 
GAAP diluted (loss)/earnings per share  

$

(2.30

)

 

$

0.48

 

$

(1.47

)

 

$

0.65

Strategic corporate reorganization costs (1)  

 

0.10

 

 

 

-

 

 

0.22

 

 

 

-

Repurchase and conversion of Series B Preferred Stock (2)  

 

3.15

 

 

 

-

 

 

3.23

 

 

 

-

Tax effect of strategic corporate reorganization costs (3)  

 

(0.02

)

 

 

-

 

 

(0.04

)

 

 

-

Adjusted diluted earnings per share  

$

0.93

 

 

$

0.48

 

$

1.94

 

 

$

0.65

(Note) The above table does not include the impact of allocation of undistributed earnings to participating securities for Special items.

(1)

 

Represents strategic corporate reorganization costs associated with our new office in Atlanta, Georgia projected to open in the fall of 2021.

(2)

 

Represents the one-time charge related to the repurchase and conversion of all shares of Series B Preferred Stock and includes related professional fees incurred as part of the transaction.

(3)

 

The tax effect for strategic corporate reorganization costs was calculated by applying the 2021 marginal tax rate of 22.4%. There was no tax effect on the repurchase and conversion of the Series B Preferred Stock as the one-time charge was non-deductible for tax purposes.

 
Papa John's International, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
         
         
   

June 27,

 

December 27,

   

 

2021

 

 

 

2020

 

(In thousands)   (Unaudited)   (Note)
         
Assets        
Current assets:      
Cash and cash equivalents

$

96,213

 

 

$

130,204

 

Accounts receivable, net

 

75,839

 

 

 

90,135

 

Notes receivable, current portion

 

11,398

 

 

 

11,318

 

Income tax receivable

 

1,084

 

 

 

1,273

 

Inventories  

 

29,843

 

 

 

30,265

 

Prepaid expenses and other current assets

 

47,966

 

 

 

43,212

 

Total current assets

 

262,343

 

 

 

306,407

 

         
Property and equipment, net

 

198,818

 

 

 

200,895

 

Finance lease right-of-use assets, net

 

22,840

 

 

 

16,840

 

Operating lease right-of-use assets

 

166,090

 

 

 

148,110

 

Notes receivable, less current portion, net

 

34,418

 

 

 

36,538

 

Goodwill  

 

81,103

 

 

 

80,791

 

Deferred income taxes

 

10,388

 

 

 

10,800

 

Other assets  

 

79,744

 

 

 

72,389

 

Total assets  

$

855,744

 

 

$

872,770

 

         
         
Liabilities, Series B Convertible Preferred Stock, Redeemable noncontrolling interests and Stockholders' deficit      
Current liabilities:      
Accounts payable

$

31,496

 

 

$

37,370

 

Income and other taxes payable

 

28,763

 

 

 

10,263

 

Accrued expenses and other current liabilities

 

187,789

 

 

 

174,563

 

Current deferred revenue

 

20,536

 

 

 

19,590

 

Current finance lease liabilities

 

4,726

 

 

 

3,545

 

Current operating lease liabilities

 

23,194

 

 

 

23,538

 

Current portion of long-term debt

 

20,000

 

 

 

20,000

 

Total current liabilities

 

316,504

 

 

 

288,869

 

         
Deferred revenue

 

13,017

 

 

 

13,664

 

Long-term finance lease liabilities

 

18,555

 

 

 

13,531

 

Long-term operating lease liabilities

 

143,940

 

 

 

124,666

 

Long-term debt, less current portion, net

 

403,810

 

 

 

328,292

 

Deferred income taxes

 

278

 

 

 

948

 

Other long-term liabilities

 

100,699

 

 

 

111,364

 

Total liabilities

 

996,803

 

 

 

881,334

 

         
Series B Convertible Preferred Stock

 

 

 

 

251,901

 

Redeemable noncontrolling interests

 

6,839

 

 

 

6,474

 

         
Total Stockholders' deficit

 

(147,898

)

 

 

(266,939

)

Total liabilities, Series B Convertible Preferred Stock, Redeemable noncontrolling interests and Stockholders' deficit

$

855,744

 

 

$

872,770

 

Note: The Condensed Consolidated Balance Sheet at December 27, 2020 has been derived from the audited consolidated financial statements, but does not include all information and footnotes required by accounting principles generally accepted in the United States for a complete set of financial statements.
 
Papa John's International, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
 
                 
   

Three Months Ended

 

Six Months Ended

   

June 27, 2021

 

June 28, 2020

 

June 27, 2021

 

June 28, 2020

(In thousands, except per share amounts)  

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

Revenues:                
Domestic company-owned restaurant sales  

$

196,124

 

 

$

186,506

 

 

$

393,358

 

 

$

347,946

 

North America franchise royalties and fees  

 

32,475

 

 

 

24,174

 

 

 

65,190

 

 

 

43,614

 

North America commissary revenues  

 

186,641

 

 

 

167,619

 

 

 

371,519

 

 

 

323,041

 

International revenues  

 

37,614

 

 

 

28,093

 

 

 

72,221

 

 

 

54,152

 

Other revenues  

 

62,154

 

 

 

54,231

 

 

 

124,466

 

 

 

101,729

 

Total revenues  

 

515,008

 

 

 

460,623

 

 

 

1,026,754

 

 

 

870,482

 

                 
Costs and expenses:                
Operating costs (excluding depreciation and amortization                
shown separately below):                
Domestic company-owned restaurant expenses  

 

154,293

 

 

 

145,168

 

 

 

310,181

 

 

 

274,279

 

North America commissary expenses  

 

172,227

 

 

 

154,467

 

 

 

342,911

 

 

 

298,739

 

International expenses  

 

21,430

 

 

 

18,304

 

 

 

41,048

 

 

 

33,405

 

Other expenses  

 

56,246

 

 

 

51,345

 

 

 

112,053

 

 

 

97,302

 

General and administrative expenses  

 

53,698

 

 

 

48,428

 

 

 

103,709

 

 

 

96,079

 

Depreciation and amortization  

 

12,477

 

 

 

12,377

 

 

 

25,353

 

 

 

24,672

 

Total costs and expenses  

 

470,371

 

 

 

430,089

 

 

 

935,255

 

 

 

824,476

 

Operating income  

 

44,637

 

 

 

30,534

 

 

 

91,499

 

 

 

46,006

 

Net interest expense  

 

(3,649

)

 

 

(3,627

)

 

 

(7,296

)

 

 

(7,594

)

Income before income taxes  

 

40,988

 

 

 

26,907

 

 

 

84,203

 

 

 

38,412

 

Income tax expense  

 

7,398

 

 

 

4,956

 

 

 

15,330

 

 

 

7,468

 

Net income before attribution to noncontrolling interests  

 

33,590

 

 

 

21,951

 

 

 

68,873

 

 

 

30,944

 

Net income attributable to noncontrolling interests  

 

(1,336

)

 

 

(1,337

)

 

 

(2,736

)

 

 

(1,887

)

Net income attributable to the company  

$

32,254

 

 

$

20,614

 

 

$

66,137

 

 

$

29,057

 

                 
Calculation of net (loss) income for earnings per share:                
Net income attributable to the company  

$

32,254

 

 

$

20,614

 

 

$

66,137

 

 

$

29,057

 

Dividends on redemption of Series B Convertible Preferred Stock  

 

(109,852

)

 

 

 

 

 

(109,852

)

 

 

 

Dividends paid to participating securities  

 

(2,300

)

 

 

(3,347

)

 

 

(5,827

)

 

 

(6,818

)

Net income attributable to participating securities  

 

 

 

 

(1,560

)

 

 

 

 

 

(1,306

)

Net (loss) income attributable to common shareholders  

$

(79,898

)

 

$

15,707

 

 

$

(49,542

)

 

$

20,933

 

                 
Basic (loss) earnings per common share  

$

(2.30

)

 

$

0.49

 

 

$

(1.47

)

 

$

0.65

 

Diluted (loss) earnings per common share  

$

(2.30

)

 

$

0.48

 

 

$

(1.47

)

 

$

0.65

 

                 
Basic weighted average common shares outstanding  

 

34,729

 

 

 

32,335

 

 

 

33,739

 

 

 

32,214

 

Diluted weighted average common shares outstanding  

 

34,729

 

 

 

32,619

 

 

 

33,739

 

 

 

32,444

 

                 
Dividends declared per common share  

$

0.225

 

 

$

0.225

 

 

$

0.450

 

 

$

0.450

 

 
Papa John's International, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
 
       
  Six Months Ended
(In thousands) June 27, 2021   June 28, 2020
  (Unaudited)   (Unaudited)
Operating activities      
Net income before attribution to noncontrolling interests

$

68,873

 

 

$

30,944

 

Adjustments to reconcile net income to net cash provided by      
operating activities:      
(Credit) provision for allowance for credit losses on accounts and notes receivable

 

(1,200

)

 

 

1,051

 

Depreciation and amortization

 

25,353

 

 

 

24,672

 

Deferred income taxes

 

(1,397

)

 

 

(1,502

)

Stock-based compensation expense

 

8,202

 

 

 

8,742

 

Other

 

467

 

 

 

1,090

 

Changes in operating assets and liabilities, net of acquisitions:      
Accounts receivable

 

13,299

 

 

 

(8,571

)

Income tax receivable

 

189

 

 

 

4,278

 

Inventories

 

430

 

 

 

(5,017

)

Prepaid expenses and other current assets

 

1,092

 

 

 

9,657

 

Other assets and liabilities

 

(11,380

)

 

 

8,065

 

Accounts payable

 

(5,874

)

 

 

1,558

 

Income and other taxes payable

 

18,500

 

 

 

3,601

 

Accrued expenses and other current liabilities

 

12,123

 

 

 

10,269

 

Deferred revenue

 

(647

)

 

 

(1,179

)

Net cash provided by operating activities

 

128,030

 

 

 

87,658

 

       
Investing activities      
Purchases of property and equipment

 

(21,543

)

 

 

(13,795

)

Notes issued

 

(5,263

)

 

 

(9,596

)

Repayments of notes issued

 

7,922

 

 

 

6,462

 

Acquisitions, net of cash acquired

 

(699

)

 

 

 

Other

 

116

 

 

 

14

 

Net cash used in investing activities

 

(19,467

)

 

 

(16,915

)

       
Financing activities      
Repayments of term loan

 

(10,000

)

 

 

(10,000

)

Net proceeds (repayments) of revolving credit facilities

 

85,000

 

 

 

(9,884

)

Proceeds from exercise of stock options

 

8,100

 

 

 

21,704

 

Dividends paid to common stockholders

 

(14,844

)

 

 

(14,520

)

Dividends paid to preferred stockholders

 

(6,394

)

 

 

(6,825

)

Tax payments for equity award issuances

 

(3,887

)

 

 

(1,579

)

Repurchase of Series B Convertible Preferred Stock

 

(188,647

)

 

 

 

Acquisition of Company common stock

 

(8,188

)

 

 

 

Distributions to noncontrolling interests

 

(2,320

)

 

 

(945

)

Other

 

(1,691

)

 

 

(704

)

Net cash used in financing activities

 

(142,871

)

 

 

(22,753

)

       
Effect of exchange rate changes on cash and cash equivalents

 

317

 

 

 

(202

)

Change in cash and cash equivalents

 

(33,991

)

 

 

47,788

 

Cash and cash equivalents at beginning of period

 

130,204

 

 

 

27,911

 

       
Cash and cash equivalents at end of period

$

96,213

 

 

$

75,699

 

SOURCE Papa John’s International, Inc.

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