2016 | 2015 | 2014 | ||||||||||
Advertising expense | $ | 79,409 | $ | 68,665 | $ | 63,707 |
| 15. | Commitments and Contingencies |
| 5. | Debt |
| 6. | Derivative Instruments and Hedging Activities |
Trade Date | Effective Date | Term (in Years) | Notional Amount | Fixed Rate | |||||||||
March 18, 2013 | May 3, 2015 | 3 | $ | 50,000 | 1.51 | % | |||||||
April 8, 2013 | May 3, 2015 | 2 | 50,000 | 1.05 | % | ||||||||
April 15, 2013 | May 3, 2015 | 2 | 50,000 | 1.03 | % | ||||||||
April 22, 2013 | May 3, 2015 | 3 | 25,000 | 1.30 | % | ||||||||
April 25, 2013 | May 3, 2015 | 3 | 25,000 | 1.29 | % | ||||||||
June 18, 2014 | May 3, 2015 | 4 | 80,000 | 2.51 | % | ||||||||
June 24, 2014 | May 3, 2015 | 4 | 60,000 | 2.51 | % | ||||||||
July 1, 2014 | May 5, 2015 | 4 | 60,000 | 2.43 | % | ||||||||
January 30, 2015 | May 3, 2019 | 2 | 80,000 | 2.15 | % | ||||||||
January 30, 2015 | May 3, 2019 | 2 | 60,000 | 2.16 | % | ||||||||
January 30, 2015 | May 4, 2021 | 3 | 120,000 | 2.41 | % | ||||||||
January 30, 2015 | May 3, 2019 | 2 | 60,000 | 2.15 | % | ||||||||
January 30, 2015 | May 4, 2021 | 3 | 80,000 | 2.40 | % |
(See Note 3) | Balance Sheet Location | July 29, 2016 | July 31, 2015 | ||||||
Interest rate swaps | Other assets | $ | -- | $ | 3,759 | ||||
Interest rate swaps | Current interest rate swap liability | $ | 180 | $ | 1,117 | ||||
Interest rate swaps | Long-term interest rate swap liability | 22,070 | 8,704 | ||||||
Total liabilities | $ | 22,250 | $ | 9,821 |
Gross Asset Amounts | Liability Amount Offset | Net Asset Amount Presented in the Balance Sheets | ||||||||||||||||||||||
(See Note 3) | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | ||||||||||||||||||
Interest rate swaps | $ | -- | $ | 3,878 | $ | -- | $ | (119 | ) | $ | -- | $ | 3,759 |
Gross Liability Amounts | Asset Amount Offset | Net Liability Amount Presented in the Balance Sheets | ||||||||||||||||||||||
(See Note 3) | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | ||||||||||||||||||
Interest rate swaps | $ | 22,250 | $ | 9,821 | $ | -- | $ | -- | $ | 22,250 | $ | 9,821 |
Amount of (Loss) Income Recognized in AOCL on Derivatives (Effective Portion) | ||||||||||||
2016 | 2015 | 2014 | ||||||||||
Cash flow hedges: | ||||||||||||
Interest rate swaps | $ | (16,188 | ) | $ | 1,641 | $ | 3,058 |
July 29, 2016 | July 31, 2015 | August 1, 2014 | ||||||||||
Beginning AOCL balance | $ | (3,725 | ) | $ | (4,733 | ) | $ | (6,612 | ) | |||
Other comprehensive (loss) income before reclassifications | (6,683 | ) | 5,955 | 6,836 | ||||||||
Amounts reclassified from AOCL into earnings | (3,332 | ) | (4,947 | ) | (4,957 | ) | ||||||
Other comprehensive (loss) income, net of tax | (10,015 | ) | 1,008 | 1,879 | ||||||||
Ending AOCL balance | $ | (13,740 | ) | $ | (3,725 | ) | $ | (4,733 | ) |
Location of Loss Reclassified from AOCL into Income (Effective Portion) | Amount of Loss Reclassified from AOCL into Income (Effective Portion) | ||||||||||||
2016 | 2015 | 2014 | |||||||||||
Cash flow hedges: | |||||||||||||
Interest rate swaps | Interest expense | $ | 5,395 | $ | 8,052 | $ | 8,068 |
Details about AOCL | July 29, 2016 | July 31, 2015 | August 1, 2014 | Affected Line Item in the Consolidated Statement of Income | |||||||||
Loss on cash flow hedges: | |||||||||||||
Interest rate swaps | $ | (5,395 | ) | $ | (8,052 | ) | $ | (8,068 | ) | Interest expense | |||
Tax benefit | 2,063 | 3,105 | 3,111 | Provision for income taxes | |||||||||
$ | (3,332 | ) | $ | (4,947 | ) | $ | (4,957 | ) | Net of tax |
| 10. | Share-Based Compensation |
2010 Omnibus Plan | 200,909 | |||
Amended and Restated Stock Option Plan | 2,683 | |||
2002 Omnibus Incentive Compensation Plan | 10,000 | |||
Total | 213,592 |
Long-Term Performance Plan (“LTPP”) | Performance Period | Vesting Period (in Years) | |||
2016 LTPP | 2016 – 2017 | 2 or 3 | |||
2015 LTPP | 2015 – 2016 | 2 or 3 |
2016 LTPP | 14,550 | |||
2015 LTPP | 74,316 |
Nonvested Stock | Shares | Weighted-Average Grant Date Fair Value | ||||||
Unvested at July 31, 2015 | 39,163 | $ | 95.66 | |||||
Granted | 61,729 | 149.39 | ||||||
Vested | (60,455 | ) | 139.24 | |||||
Forfeited | -- | -- | ||||||
Unvested at July 29, 2016 | 40,437 | $ | 112.52 |
2016 | 2015 | 2014 | ||||||||||
Total fair value of nonvested stock | $ | 8,418 | $ | 8,152 | $ | 17,417 |
| · | The expected volatility is a blend of implied volatility based on market-traded options on our stock and historical volatility of our stock over the period commensurate with the three-year performance period. |
| · | The risk-free interest rate is based on the U.S. Treasury rate assumption commensurate with the three-year performance period. |
| · | The expected dividend yield is based on our current dividend yield as the best estimate of projected dividend yield for periods within the three-year performance period. |
Year Ended | ||||||||||||
July 29, 2016 | July 31, 2015 | August 1, 2014 | ||||||||||
Dividend yield*** | -- | -- | -- | |||||||||
Expected volatility | 23% - 24 | % | 21 | % | 25 | % | ||||||
Risk-free interest rate range | 0.9% - 1.0 | % | 1.0 | % | 0.7% - 0.8 | % |
Shares | ||||
2014 MSU Grants | 37,786 | |||
2015 MSU Grants | 26,955 | |||
2016 MSU Grants | 6,865 |
Fixed Options | Shares | Weighted- Average Price | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | ||||||||||||
Outstanding at July 31, 2015 | 20,458 | $ | 33.88 | |||||||||||||
Granted | -- | -- | ||||||||||||||
Exercised | (7,775 | ) | 35.78 | |||||||||||||
Forfeited | -- | -- | ||||||||||||||
Canceled | -- | -- | ||||||||||||||
Outstanding at July 29, 2016 | 12,683 | $ | 32.71 | 1.23 | $ | 1,582 | ||||||||||
Exercisable | 12,683 | $ | 32.71 | 1.23 | $ | 1,582 |
2016 | 2015 | 2014 | ||||||||||
Total intrinsic values of options exercised* | $ | 917 | $ | 4,652 | $ | 169 |
2016 | 2015 | 2014 | ||||||||||
Nonvested stock awards | $ | 10,277 | $ | 13,243 | $ | 5,762 | ||||||
MSU Grants | 2,925 | 2,967 | 2,162 | |||||||||
Total compensation expense | $ | 13,202 | $ | 16,210 | $ | 7,924 |
Nonvested Stock | MSU Grants | |||||||
Total unrecognized compensation | $ | 1,521 | $ | 2,958 | ||||
Weighted-average period in years | 2.48 | 1.66 |
2016 | 2015 | 2014 | ||||||||||
Total income tax benefit | $ | 3,819 | $ | 5,056 | $ | 2,438 |
| 14. | Net Income Per Share and Weighted Average Shares |
2016 | 2015 | 2014 | ||||||||||
Net income per share numerator | $ | 189,299 | $ | 163,903 | $ | 132,128 | ||||||
Net income per share denominator: | ||||||||||||
Basic weighted average shares outstanding | 23,945,041 | 23,918,368 | 23,817,768 | |||||||||
Add potential dilution: | ||||||||||||
Stock options, nonvested stock awards and MSU Grants | 129,232 | 130,556 | 148,247 | |||||||||
Diluted weighted average shares outstanding | 24,074,273 | 24,048,924 | 23,966,015 |
| 3. | Fair Value Measurements |
| · | Quoted Prices in Active Markets for Identical Assets (“Level 1”) – quoted prices (unadjusted) for an identical asset or liability in an active market. |
| · | Significant Other Observable Inputs (“Level 2”) – quoted prices for a similar asset or liability in an active market or model-derived valuations in which all significant inputs are observable for substantially the full term of the asset or liability. |
| · | Significant Unobservable Inputs (“Level 3”) – unobservable and significant to the fair value measurement of the asset or liability. |
Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||
Cash equivalents* | $ | 76,084 | $ | -- | $ | -- | $ | 76,084 | ||||||||
Interest rate swap asset (see Note 6) | -- | -- | -- | -- | ||||||||||||
Deferred compensation plan assets** | 27,764 | -- | -- | 27,764 | ||||||||||||
Total assets at fair value | $ | 103,848 | $ | -- | $ | -- | $ | 103,848 | ||||||||
Interest rate swap liability (see Note 6) | $ | -- | $ | 22,250 | $ | -- | $ | 22,250 | ||||||||
Total liabilities at fair value | $ | -- | $ | 22,250 | $ | -- | $ | 22,250 |
Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||
Cash equivalents* | $ | 191,084 | $ | -- | $ | -- | $ | 191,084 | ||||||||
Interest rate swap asset (see Note 6) | -- | 3,759 | -- | 3,759 | ||||||||||||
Deferred compensation plan assets** | 26,947 | -- | -- | 26,947 | ||||||||||||
Total assets at fair value | $ | 218,031 | $ | 3,759 | $ | -- | $ | 221,790 | ||||||||
Interest rate swap liability (see Note 6) | $ | -- | $ | 9,821 | $ | -- | $ | 9,821 | ||||||||
Total liabilities at fair value | $ | -- | $ | 9,821 | $ | -- | $ | 9,821 |
| · | Quoted Prices in Active Markets for Identical Assets (“Level 1”) – quoted prices (unadjusted) for an identical asset or liability in an active market. |
| · | Significant Other Observable Inputs (“Level 2”) – quoted prices for a similar asset or liability in an active market or model-derived valuations in which all significant inputs are observable for substantially the full term of the asset or liability. |
| · | Significant Unobservable Inputs (“Level 3”) – unobservable and significant to the fair value measurement of the asset or liability. |
| 13. | Income Taxes |
2016 | 2015 | 2014 | ||||||||||
Current: | ||||||||||||
Federal | $ | 62,054 | $ | 71,386 | $ | 53,713 | ||||||
State | 6,447 | 6,050 | 4,597 | |||||||||
Deferred: | ||||||||||||
Federal | 12,477 | (6,178 | ) | (2,863 | ) | |||||||
State | (3,858 | ) | 3,040 | 3,274 | ||||||||
Total provision for income taxes | $ | 77,120 | $ | 74,298 | $ | 58,721 |
2016 | 2015 | 2014 | ||||||||||
Provision computed at federal statutory income tax rate | $ | 93,247 | $ | 83,370 | $ | 66,797 | ||||||
State and local income taxes, net of federal benefit | 1,427 | 6,378 | 5,029 | |||||||||
Employer tax credits for FICA taxes paid on employee tip income | (11,048 | ) | (10,681 | ) | (9,962 | ) | ||||||
Other employer tax credits | (7,326 | ) | (5,058 | ) | (3,781 | ) | ||||||
Other-net | 820 | 289 | 638 | |||||||||
Total provision for income taxes | $ | 77,120 | $ | 74,298 | $ | 58,721 |
July 29, 2016 | July 31, 2015 | |||||||
Deferred tax assets: | ||||||||
Compensation and employee benefits | $ | 13,937 | $ | 13,721 | ||||
Deferred rent | 17,183 | 16,022 | ||||||
Accrued liabilities | 12,466 | 16,869 | ||||||
Insurance reserves | 11,444 | 12,074 | ||||||
Inventory | 4,368 | 4,525 | ||||||
Other | 8,718 | 2,606 | ||||||
Deferred tax assets | $ | 68,116 | $ | 65,817 | ||||
Deferred tax liabilities: | ||||||||
Property and equipment | $ | 97,695 | $ | 88,651 | ||||
Inventory | 9,803 | 11,568 | ||||||
Other | 12,024 | 9,534 | ||||||
Deferred tax liabilities | 119,522 | 109,753 | ||||||
Net deferred tax liability | $ | 51,406 | $ | 43,936 |
July 29, 2016 | July 31, 2015 | August 1, 2014 | ||||||||||
Balance at beginning of year | $ | 25,507 | $ | 22,832 | $ | 20,972 | ||||||
Tax positions related to the current year: | ||||||||||||
Additions | 4,860 | 3,994 | 3,989 | |||||||||
Reductions | -- | -- | -- | |||||||||
Tax positions related to the prior year: | ||||||||||||
Additions | 2,186 | 118 | 1,400 | |||||||||
Reductions | (6,896 | ) | (227 | ) | (1,630 | ) | ||||||
Settlements | (2,324 | ) | (204 | ) | (755 | ) | ||||||
Expiration of statute of limitations | (1,434 | ) | (1,006 | ) | (1,144 | ) | ||||||
Balance at end of year | $ | 21,899 | $ | 25,507 | $ | 22,832 |
2016 | 2015 | 2014 | ||||||||||
Uncertain tax positions | $ | 14,234 | $ | 16,579 | $ | 14,840 |
| 4. | Inventories |
July 29, 2016 | July 31, 2015 | |||||||
Retail | $ | 114,610 | $ | 115,777 | ||||
Restaurant | 21,522 | 22,212 | ||||||
Supplies | 16,176 | 15,069 | ||||||
Total | $ | 152,308 | $ | 153,058 |
| 9. | Leases |
Year | Minimum | Contingent | Total | |||||||||
2016 | $ | 74,405 | $ | 263 | $ | 74,668 | ||||||
2015 | 72,877 | 252 | 73,129 | |||||||||
2014 | 71,123 | 242 | 71,365 |
Year | Total | |||
2017 | $ | 63,435 | ||
2018 | 51,523 | |||
2019 | 47,225 | |||
2020 | 44,707 | |||
2021 | 28,680 | |||
Later years | 472,277 | |||
Total | $ | 707,847 |
| 1. | Description of the Business |
Gross Asset Amounts | Liability Amount Offset | Net Asset Amount Presented in the Balance Sheets | ||||||||||||||||||||||
(See Note 3) | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | ||||||||||||||||||
Interest rate swaps | $ | -- | $ | 3,878 | $ | -- | $ | (119 | ) | $ | -- | $ | 3,759 |
Gross Liability Amounts | Asset Amount Offset | Net Liability Amount Presented in the Balance Sheets | ||||||||||||||||||||||
(See Note 3) | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | July 29, 2016 | July 31, 2015 | ||||||||||||||||||
Interest rate swaps | $ | 22,250 | $ | 9,821 | $ | -- | $ | -- | $ | 22,250 | $ | 9,821 |
Year | Minimum | Contingent | Total | |||||||||
2016 | $ | 74,405 | $ | 263 | $ | 74,668 | ||||||
2015 | 72,877 | 252 | 73,129 | |||||||||
2014 | 71,123 | 242 | 71,365 |
| 12. | Employee Savings Plans |
2016 | 2015 | 2014 | ||||||||||
401(k) Savings Plan | $ | 2,528 | $ | 2,364 | $ | 2,167 | ||||||
Non-Qualified Savings Plan | 296 | 234 | 253 |
Years | ||||
Buildings and improvements | 30-45 | |||
Buildings under capital leases | 15-25 | |||
Restaurant and other equipment | 2-10 | |||
Leasehold improvements | 1-35 |
2016 | 2015 | 2014 | ||||||||||
Total depreciation expense | $ | 77,816 | $ | 72,390 | $ | 67,620 | ||||||
Depreciation expense related to store operations* | 71,382 | 66,754 | 62,746 |
Years | ||||
Buildings and improvements | 30-45 | |||
Buildings under capital leases | 15-25 | |||
Restaurant and other equipment | 2-10 | |||
Leasehold improvements | 1-35 |
| 16. | Quarterly Financial Data (Unaudited) |
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | |||||||||||||
2016 | ||||||||||||||||
Total revenue | $ | 702,629 | $ | 764,002 | $ | 700,136 | $ | 745,584 | ||||||||
Store operating income | 99,627 | 106,032 | 103,419 | 114,375 | ||||||||||||
Income before income taxes | 61,764 | 66,956 | 63,592 | 74,107 | ||||||||||||
Net income | 40,865 | 48,242 | 49,169 | 51,023 | ||||||||||||
Net income per share – basic | $ | 1.71 | $ | 2.02 | $ | 2.05 | $ | 2.13 | ||||||||
Net income per share – diluted | $ | 1.70 | $ | 2.01 | $ | 2.04 | $ | 2.12 | ||||||||
2015 | ||||||||||||||||
Total revenue | $ | 683,428 | $ | 755,966 | $ | 683,705 | $ | 719,185 | ||||||||
Store operating income | 88,634 | 108,411 | 94,047 | 111,332 | ||||||||||||
Income before income taxes | 51,018 | 66,537 | 51,447 | 69,199 | ||||||||||||
Net income | 34,024 | 47,163 | 35,317 | 47,399 | ||||||||||||
Net income per share – basic | $ | 1.43 | $ | 1.97 | $ | 1.48 | $ | 1.98 | ||||||||
Net income per share – diluted | $ | 1.42 | $ | 1.96 | $ | 1.47 | $ | 1.97 |
Location of Loss Reclassified from AOCL into Income (Effective Portion) | Amount of Loss Reclassified from AOCL into Income (Effective Portion) | ||||||||||||
2016 | 2015 | 2014 | |||||||||||
Cash flow hedges: | |||||||||||||
Interest rate swaps | Interest expense | $ | 5,395 | $ | 8,052 | $ | 8,068 |
Details about AOCL | July 29, 2016 | July 31, 2015 | August 1, 2014 | Affected Line Item in the Consolidated Statement of Income | |||||||||
Loss on cash flow hedges: | |||||||||||||
Interest rate swaps | $ | (5,395 | ) | $ | (8,052 | ) | $ | (8,068 | ) | Interest expense | |||
Tax benefit | 2,063 | 3,105 | 3,111 | Provision for income taxes | |||||||||
$ | (3,332 | ) | $ | (4,947 | ) | $ | (4,957 | ) | Net of tax |
2016 | 2015 | 2014 | ||||||||||
Total intrinsic values of options exercised* | $ | 917 | $ | 4,652 | $ | 169 |
July 29, 2016 | July 31, 2015 | |||||||
Retail | $ | 114,610 | $ | 115,777 | ||||
Restaurant | 21,522 | 22,212 | ||||||
Supplies | 16,176 | 15,069 | ||||||
Total | $ | 152,308 | $ | 153,058 |
2016 | 2015 | 2014 | ||||||||||
Nonvested stock awards | $ | 10,277 | $ | 13,243 | $ | 5,762 | ||||||
MSU Grants | 2,925 | 2,967 | 2,162 | |||||||||
Total compensation expense | $ | 13,202 | $ | 16,210 | $ | 7,924 |
2016 | 2015 | 2014 | ||||||||||
Current: | ||||||||||||
Federal | $ | 62,054 | $ | 71,386 | $ | 53,713 | ||||||
State | 6,447 | 6,050 | 4,597 | |||||||||
Deferred: | ||||||||||||
Federal | 12,477 | (6,178 | ) | (2,863 | ) | |||||||
State | (3,858 | ) | 3,040 | 3,274 | ||||||||
Total provision for income taxes | $ | 77,120 | $ | 74,298 | $ | 58,721 |
July 29, 2016 | July 31, 2015 | August 1, 2014 | ||||||||||
Beginning AOCL balance | $ | (3,725 | ) | $ | (4,733 | ) | $ | (6,612 | ) | |||
Other comprehensive (loss) income before reclassifications | (6,683 | ) | 5,955 | 6,836 | ||||||||
Amounts reclassified from AOCL into earnings | (3,332 | ) | (4,947 | ) | (4,957 | ) | ||||||
Other comprehensive (loss) income, net of tax | (10,015 | ) | 1,008 | 1,879 | ||||||||
Ending AOCL balance | $ | (13,740 | ) | $ | (3,725 | ) | $ | (4,733 | ) |
July 29, 2016 | July 31, 2015 | |||||||
Deferred tax assets: | ||||||||
Compensation and employee benefits | $ | 13,937 | $ | 13,721 | ||||
Deferred rent | 17,183 | 16,022 | ||||||
Accrued liabilities | 12,466 | 16,869 | ||||||
Insurance reserves | 11,444 | 12,074 | ||||||
Inventory | 4,368 | 4,525 | ||||||
Other | 8,718 | 2,606 | ||||||
Deferred tax assets | $ | 68,116 | $ | 65,817 | ||||
Deferred tax liabilities: | ||||||||
Property and equipment | $ | 97,695 | $ | 88,651 | ||||
Inventory | 9,803 | 11,568 | ||||||
Other | 12,024 | 9,534 | ||||||
Deferred tax liabilities | 119,522 | 109,753 | ||||||
Net deferred tax liability | $ | 51,406 | $ | 43,936 |
Fixed Options | Shares | Weighted- Average Price | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | ||||||||||||
Outstanding at July 31, 2015 | 20,458 | $ | 33.88 | |||||||||||||
Granted | -- | -- | ||||||||||||||
Exercised | (7,775 | ) | 35.78 | |||||||||||||
Forfeited | -- | -- | ||||||||||||||
Canceled | -- | -- | ||||||||||||||
Outstanding at July 29, 2016 | 12,683 | $ | 32.71 | 1.23 | $ | 1,582 | ||||||||||
Exercisable | 12,683 | $ | 32.71 | 1.23 | $ | 1,582 |
2016 | 2015 | 2014 | ||||||||||
Net income per share numerator | $ | 189,299 | $ | 163,903 | $ | 132,128 | ||||||
Net income per share denominator: | ||||||||||||
Basic weighted average shares outstanding | 23,945,041 | 23,918,368 | 23,817,768 | |||||||||
Add potential dilution: | ||||||||||||
Stock options, nonvested stock awards and MSU Grants | 129,232 | 130,556 | 148,247 | |||||||||
Diluted weighted average shares outstanding | 24,074,273 | 24,048,924 | 23,966,015 |
Nonvested Stock | Shares | Weighted-Average Grant Date Fair Value | ||||||
Unvested at July 31, 2015 | 39,163 | $ | 95.66 | |||||
Granted | 61,729 | 149.39 | ||||||
Vested | (60,455 | ) | 139.24 | |||||
Forfeited | -- | -- | ||||||
Unvested at July 29, 2016 | 40,437 | $ | 112.52 |
Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||
Cash equivalents* | $ | 76,084 | $ | -- | $ | -- | $ | 76,084 | ||||||||
Interest rate swap asset (see Note 6) | -- | -- | -- | -- | ||||||||||||
Deferred compensation plan assets** | 27,764 | -- | -- | 27,764 | ||||||||||||
Total assets at fair value | $ | 103,848 | $ | -- | $ | -- | $ | 103,848 | ||||||||
Interest rate swap liability (see Note 6) | $ | -- | $ | 22,250 | $ | -- | $ | 22,250 | ||||||||
Total liabilities at fair value | $ | -- | $ | 22,250 | $ | -- | $ | 22,250 |
Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||
Cash equivalents* | $ | 191,084 | $ | -- | $ | -- | $ | 191,084 | ||||||||
Interest rate swap asset (see Note 6) | -- | 3,759 | -- | 3,759 | ||||||||||||
Deferred compensation plan assets** | 26,947 | -- | -- | 26,947 | ||||||||||||
Total assets at fair value | $ | 218,031 | $ | 3,759 | $ | -- | $ | 221,790 | ||||||||
Interest rate swap liability (see Note 6) | $ | -- | $ | 9,821 | $ | -- | $ | 9,821 | ||||||||
Total liabilities at fair value | $ | -- | $ | 9,821 | $ | -- | $ | 9,821 |
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | |||||||||||||
2016 | ||||||||||||||||
Total revenue | $ | 702,629 | $ | 764,002 | $ | 700,136 | $ | 745,584 | ||||||||
Store operating income | 99,627 | 106,032 | 103,419 | 114,375 | ||||||||||||
Income before income taxes | 61,764 | 66,956 | 63,592 | 74,107 | ||||||||||||
Net income | 40,865 | 48,242 | 49,169 | 51,023 | ||||||||||||
Net income per share – basic | $ | 1.71 | $ | 2.02 | $ | 2.05 | $ | 2.13 | ||||||||
Net income per share – diluted | $ | 1.70 | $ | 2.01 | $ | 2.04 | $ | 2.12 | ||||||||
2015 | ||||||||||||||||
Total revenue | $ | 683,428 | $ | 755,966 | $ | 683,705 | $ | 719,185 | ||||||||
Store operating income | 88,634 | 108,411 | 94,047 | 111,332 | ||||||||||||
Income before income taxes | 51,018 | 66,537 | 51,447 | 69,199 | ||||||||||||
Net income | 34,024 | 47,163 | 35,317 | 47,399 | ||||||||||||
Net income per share – basic | $ | 1.43 | $ | 1.97 | $ | 1.48 | $ | 1.98 | ||||||||
Net income per share – diluted | $ | 1.42 | $ | 1.96 | $ | 1.47 | $ | 1.97 |
Year | Total | |||
2017 | $ | 63,435 | ||
2018 | 51,523 | |||
2019 | 47,225 | |||
2020 | 44,707 | |||
2021 | 28,680 | |||
Later years | 472,277 | |||
Total | $ | 707,847 |
2016 | 2015 | 2014 | ||||||||||
Provision computed at federal statutory income tax rate | $ | 93,247 | $ | 83,370 | $ | 66,797 | ||||||
State and local income taxes, net of federal benefit | 1,427 | 6,378 | 5,029 | |||||||||
Employer tax credits for FICA taxes paid on employee tip income | (11,048 | ) | (10,681 | ) | (9,962 | ) | ||||||
Other employer tax credits | (7,326 | ) | (5,058 | ) | (3,781 | ) | ||||||
Other-net | 820 | 289 | 638 | |||||||||
Total provision for income taxes | $ | 77,120 | $ | 74,298 | $ | 58,721 |
Nonvested Stock | MSU Grants | |||||||
Total unrecognized compensation | $ | 1,521 | $ | 2,958 | ||||
Weighted-average period in years | 2.48 | 1.66 |
Trade Date | Effective Date | Term (in Years) | Notional Amount | Fixed Rate | |||||||||
March 18, 2013 | May 3, 2015 | 3 | $ | 50,000 | 1.51 | % | |||||||
April 8, 2013 | May 3, 2015 | 2 | 50,000 | 1.05 | % | ||||||||
April 15, 2013 | May 3, 2015 | 2 | 50,000 | 1.03 | % | ||||||||
April 22, 2013 | May 3, 2015 | 3 | 25,000 | 1.30 | % | ||||||||
April 25, 2013 | May 3, 2015 | 3 | 25,000 | 1.29 | % | ||||||||
June 18, 2014 | May 3, 2015 | 4 | 80,000 | 2.51 | % | ||||||||
June 24, 2014 | May 3, 2015 | 4 | 60,000 | 2.51 | % | ||||||||
July 1, 2014 | May 5, 2015 | 4 | 60,000 | 2.43 | % | ||||||||
January 30, 2015 | May 3, 2019 | 2 | 80,000 | 2.15 | % | ||||||||
January 30, 2015 | May 3, 2019 | 2 | 60,000 | 2.16 | % | ||||||||
January 30, 2015 | May 4, 2021 | 3 | 120,000 | 2.41 | % | ||||||||
January 30, 2015 | May 3, 2019 | 2 | 60,000 | 2.15 | % | ||||||||
January 30, 2015 | May 4, 2021 | 3 | 80,000 | 2.40 | % |
2016 | 2015 | 2014 | ||||||||||
Restaurant | $ | 2,323,199 | $ | 2,269,610 | $ | 2,137,405 | ||||||
Retail | 589,152 | 572,674 | 546,272 | |||||||||
Total revenue | $ | 2,912,351 | $ | 2,842,284 | $ | 2,683,677 |
(See Note 3) | Balance Sheet Location | July 29, 2016 | July 31, 2015 | ||||||
Interest rate swaps | Other assets | $ | -- | $ | 3,759 | ||||
Interest rate swaps | Current interest rate swap liability | $ | 180 | $ | 1,117 | ||||
Interest rate swaps | Long-term interest rate swap liability | 22,070 | 8,704 | ||||||
Total liabilities | $ | 22,250 | $ | 9,821 |
Amount of (Loss) Income Recognized in AOCL on Derivatives (Effective Portion) | ||||||||||||
2016 | 2015 | 2014 | ||||||||||
Cash flow hedges: | ||||||||||||
Interest rate swaps | $ | (16,188 | ) | $ | 1,641 | $ | 3,058 |
| 8. | Segment Information |
2016 | 2015 | 2014 | ||||||||||
Restaurant | $ | 2,323,199 | $ | 2,269,610 | $ | 2,137,405 | ||||||
Retail | 589,152 | 572,674 | 546,272 | |||||||||
Total revenue | $ | 2,912,351 | $ | 2,842,284 | $ | 2,683,677 |
| 2. | Summary of Significant Accounting Policies |
Years | ||||
Buildings and improvements | 30-45 | |||
Buildings under capital leases | 15-25 | |||
Restaurant and other equipment | 2-10 | |||
Leasehold improvements | 1-35 |
2016 | 2015 | 2014 | ||||||||||
Total depreciation expense | $ | 77,816 | $ | 72,390 | $ | 67,620 | ||||||
Depreciation expense related to store operations* | 71,382 | 66,754 | 62,746 |
2016 | 2015 | 2014 | ||||||||||
Advertising expense | $ | 79,409 | $ | 68,665 | $ | 63,707 |
July 29, 2016 | July 31, 2015 | August 1, 2014 | ||||||||||
Balance at beginning of year | $ | 25,507 | $ | 22,832 | $ | 20,972 | ||||||
Tax positions related to the current year: | ||||||||||||
Additions | 4,860 | 3,994 | 3,989 | |||||||||
Reductions | -- | -- | -- | |||||||||
Tax positions related to the prior year: | ||||||||||||
Additions | 2,186 | 118 | 1,400 | |||||||||
Reductions | (6,896 | ) | (227 | ) | (1,630 | ) | ||||||
Settlements | (2,324 | ) | (204 | ) | (755 | ) | ||||||
Expiration of statute of limitations | (1,434 | ) | (1,006 | ) | (1,144 | ) | ||||||
Balance at end of year | $ | 21,899 | $ | 25,507 | $ | 22,832 |
2016 | 2015 | 2014 | ||||||||||
Advertising expense | $ | 79,409 | $ | 68,665 | $ | 63,707 |
2016 | 2015 | 2014 | ||||||||||
Total depreciation expense | $ | 77,816 | $ | 72,390 | $ | 67,620 | ||||||
Depreciation expense related to store operations* | 71,382 | 66,754 | 62,746 |
| 7. | Share Repurchases |
2016 | 2015 | 2014 | ||||||||||
Maximum aggregate purchase price | $ | 25,000 | $ | 25,000 | $ | 50,000 | ||||||
Cost of shares repurchased | $ | 14,653 | $ | -- | $ | 12,473 | ||||||
Shares of common stock repurchased | 100,000 | -- | 120,000 |
2016 | 2015 | 2014 | ||||||||||
Maximum aggregate purchase price | $ | 25,000 | $ | 25,000 | $ | 50,000 | ||||||
Cost of shares repurchased | $ | 14,653 | $ | -- | $ | 12,473 | ||||||
Shares of common stock repurchased | 100,000 | -- | 120,000 |
2016 | 2015 | 2014 | ||||||||||
Uncertain tax positions | $ | 14,234 | $ | 16,579 | $ | 14,840 |
Year Ended | ||||||||||||
July 29, 2016 | July 31, 2015 | August 1, 2014 | ||||||||||
Dividend yield*** | -- | -- | -- | |||||||||
Expected volatility | 23% - 24 | % | 21 | % | 25 | % | ||||||
Risk-free interest rate range | 0.9% - 1.0 | % | 1.0 | % | 0.7% - 0.8 | % |
Long-Term Performance Plan (“LTPP”) | Performance Period | Vesting Period (in Years) | |||
2016 LTPP | 2016 – 2017 | 2 or 3 | |||
2015 LTPP | 2015 – 2016 | 2 or 3 |
Shares | ||||
2014 MSU Grants | 37,786 | |||
2015 MSU Grants | 26,955 | |||
2016 MSU Grants | 6,865 |
2016 | 2015 | 2014 | ||||||||||
Total fair value of nonvested stock | $ | 8,418 | $ | 8,152 | $ | 17,417 |
2016 LTPP | 14,550 | |||
2015 LTPP | 74,316 |
2010 Omnibus Plan | 200,909 | |||
Amended and Restated Stock Option Plan | 2,683 | |||
2002 Omnibus Incentive Compensation Plan | 10,000 | |||
Total | 213,592 |
2016 | 2015 | 2014 | ||||||||||
Total income tax benefit | $ | 3,819 | $ | 5,056 | $ | 2,438 |
2016 | 2015 | 2014 | ||||||||||
401(k) Savings Plan | $ | 2,528 | $ | 2,364 | $ | 2,167 | ||||||
Non-Qualified Savings Plan | 296 | 234 | 253 |
| 11. | Shareholder Rights Plan |
| · | will not be redeemable. |
| · | will entitle holders to quarterly dividend payments of $0.01 per share, or an amount equal to the dividend paid on one share of common stock, whichever is greater. |
| · | will entitle holders upon liquidation either to receive $1.00 per share or an amount equal to the payment made on one share of common stock, whichever is greater. |
| · | will have the same voting power as one share of common stock. |
| · | if shares of the Company’s common stock are exchanged via merger, consolidation, or a similar transaction, will entitle holders to a per share payment equal to the payment made on one share of common stock. |