Annual report pursuant to Section 13 and 15(d)

Note 16 - Segment Information

v3.22.4
Note 16 - Segment Information
 12 Months Ended
Dec. 25, 2022
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

(16) Segment Information

 

The Company has two reportable segments – the Company-owned steakhouse segment and the franchise operations segment. 

 

The Company-owned Ruth’s Chris Steak House restaurants, all of which are located in North America, operate within the full-service dining industry, providing similar products to similar customers. Revenues are derived principally from food and beverage sales. As of December 25, 2022, (i) the Company-owned steakhouse restaurant segment included 77 Ruth’s Chris Steak House restaurants and three Ruth’s Chris Steak House restaurants operating under a management agreement and (ii) the franchise operations segment included 74 franchisee-owned Ruth’s Chris Steak House restaurants. Segment profits for the Company-owned steakhouse restaurant segments equal segment revenues less segment expenses. Segment revenues for the Company-owned steakhouse restaurants include restaurant sales, management agreement income and other restaurant income. Gift card breakage revenue is not allocated to operating segments. Not all operating expenses are allocated to operating segments. Segment expenses for the Company-owned steakhouse segment include food and beverage costs and restaurant operating expenses.  No other operating costs are allocated to the segments for the purpose of determining segment profits because such costs are not directly related to the operation of individual restaurants. The accounting policies applicable to each segment are consistent with the policies used to prepare the consolidated financial statements. The profit of the franchise operations segment equals franchise income, which consists of franchise royalty fees and franchise opening fees. No costs are allocated to the franchise operations segment. Segment information related to the Company’s two reportable business segments follows.

 

   

Fiscal Year Ended

  
   

2022

    

2021

    

2020

  
           

(dollar amounts in thousands)

          

Revenues:

                        

Company-owned steakhouse restaurants

   $ 481,129     $ 407,418     $ 263,731  

Franchise operations

     20,571       18,533       11,737  

Unallocated other revenue and revenue discounts

     4,158       3,172       2,280  

Total revenues

   $ 505,858     $ 429,123     $ 277,748  
                         

Segment profits:

                        

Company-owned steakhouse restaurants

   $ 108,487     $ 99,297     $ 37,480  

Franchise operations

     20,571       18,533       11,737  

Total segment profit

     129,058       117,830       49,217  
                         

Unallocated operating income

     4,158       3,172       2,280  

Marketing and advertising expenses

     (17,360 )     (13,464 )     (6,859 )

General and administrative costs

     (37,071 )     (32,531 )     (33,248 )

Depreciation and amortization expenses

     (22,103 )     (20,487 )     (21,964 )

Pre-opening costs

     (3,058 )     (1,894 )     (1,633 )

Gain (loss) on lease modifications

     (90 )     (1,058 )     206  

Loss on impairment

     (574 )     (1,854 )     (16,548 )

Loss on legal settlement

     (6,000 )     —       —  

Interest expense, net

     (1,507 )     (3,478 )     (4,681 )

Other income (expense)

     178       102       26  

Income (loss) from continuing operations before income tax expense

   $ 45,631     $ 46,338     $ (33,204 )
                         

Capital expenditures:

                        

Company-owned steakhouse restaurants

   $ 38,110     $ 11,292     $ 10,294  

Corporate assets

     8,848       8,359       326  

Total capital expenditures

   $ 46,958     $ 19,651     $ 10,620  

 

   

Fiscal Year Ended

  
   

December 25,

    

December 26,

    

December 27,

  
   

2022

    

2021

    

2020

  
           

(dollar amounts in thousands)

          

Total assets:

                        

Company-owned steakhouse restaurants

   $ 453,650     $ 404,929     $ 420,245  

Franchise operations

     2,487       2,801       1,705  

Corporate assets - unallocated

     62,281       128,249       112,108  

Deferred income taxes - unallocated

     3,388       -       8,616  

Total assets

   $ 521,806     $ 535,979     $ 542,674