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DINEEQUITY INC Reports Operating Results (10-Q)

October 30, 2012 | About:
10qk

10qk

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DINEEQUITY INC (DIN) filed Quarterly Report for the period ended 2012-09-30.

Dineequity Inc has a market cap of $1.06 billion; its shares were traded at around $57.63 with a P/E ratio of 13.2 and P/S ratio of 1. Dineequity Inc had an annual average earning growth of 14.1% over the past 10 years.
This is the annual revenues and earnings per share of DIN over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of DIN.


Highlight of Business Operations:

The $3.7 million increase in Applebee s franchise revenue was primarily attributable to increased royalty revenue resulting from the refranchising of 182 company-operated restaurants in the past 15 months (one in the third quarter of 2011, 66 in the fourth quarter of 2011, 17 in the first quarter of 2012 and 98 in the third quarter of 2012) and a 2.2% increase in domestic same-restaurant sales. The $1.2 million increase in IHOP franchise revenue (other than advertising) was primarily attributable to an increase in sales volume of pancake and waffle dry mix and a 2.2% increase in effective franchise restaurants, partially offset by a decrease of 2.0% in IHOP domestic franchise same-restaurant sales. The $1.6 million increase in IHOP franchise expenses was primarily due to costs associated with the increased dry mix revenues and an increase in bad debt expense.

The $9.2 million increase in Applebee s franchise revenue was primarily attributable to increased royalty revenue resulting from the refranchising of 247 Applebee s company-operated restaurants in the past 21 months and a 1.2% increase in domestic same-restaurant sales. The $2.6 million increase in IHOP franchise revenue (other than advertising) was primarily attributable to a 2.7% increase in effective franchise restaurants partially offset by a decrease of 1.2% in IHOP domestic franchise same-restaurant sales. The $0.6 million increase in IHOP franchise expenses was primarily due to higher pre-opening expenses.

All of our financing operations relate to IHOP franchise restaurants. The variance in both revenue and expense is primarily related to a 2011 transaction in which 40 restaurants operated by a former franchisee that defaulted on its obligations under the franchise agreement were refranchised to an affiliate of an existing IHOP franchisee. Certain equipment related to the refranchised restaurants was sold to the new operator. Financing revenues and expenses for the nine months ended September 30, 2011 included $5.8 million of revenue and $6.0 million of costs related to equipment sales, of which $5.0 million and $5.2 million, respectively, related to that single equipment sale. Financing revenues and expenses for the nine months ended September 30, 2012 included $1.6 million related to several individually insignificant equipment and franchise sales. In addition to the variances in revenues and expenses due to equipment sales, financing revenues decreased $0.7 million due to the progressive decline in note balances as a result of repayments.

Cash provided by operating activities decreased $27.0 million to $68.1 million for the nine months ended September 30, 2012 from $95.1 million for the nine months ended September 30, 2011. The main reasons for the decrease in cash from operations is a decline in segment profit, primarily resulting from the refranchising of 247 Applebee s company-operated restaurants during the last 21 months, and an increase in income taxes paid in cash, partially offset by a decrease in cash payments for interest. Our net income tax payments increased during the first nine months of 2012 compared with the comparable prior year period primarily because we had received a tax refund of approximately $20 million in January 2011 related to tax deductions associated with our October 2010 refinancing of debt. Our interest payments are lower because of lower debt balances. Net changes in working capital provided cash of $19.4 million in the first nine months of 2012 compared to a use of $16.9 million in the first nine months of 2011, a favorable change of $36.3 million. This change was due to the timing of payments for marketing accruals and other accrued expenses and an increase in gift card receivable collections.

Net cash provided by investing activities of $135.2 million for the nine months ended September 30, 2012 was primarily attributable to $137.4 million in proceeds from sales of property and equipment and $10.3 million in principal receipts from notes, equipment contracts and other long-term receivables, partially offset by $13.5 million in capital expenditures. Capital expenditures are expected to range between approximately $18 million and $20 million for fiscal 2012.

Read the The complete Report

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