Dunkin' Donuts 2012 Annual Report Download - page 46

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and include no intersegment revenues. Revenues not included in segment revenues include revenue earned through
arrangements with third parties in which our brand names are used and revenue generated from online training programs for
franchisees that are not allocated to a specific segment.
Beginning in fiscal year 2012, retail sales for Dunkin’ Donuts U.S. company-owned restaurants are now included in the
Dunkin’ Donuts U.S. segment revenues. Prior to fiscal year 2012, retail sales for Dunkin’ Donuts U.S. company-owned
restaurants were excluded from segment revenues. Additionally, revenue and segment profit for Baskin-Robbins’ sales to
United States military locations located internationally were previously included in the Baskin-Robbins International segment,
but are now included within the Baskin-Robbins U.S. segment. Revenues for Dunkin’ Donuts U.S. and revenues and segment
profit for Baskin-Robbins U.S. and Baskin-Robbins International in the tables below have been restated to reflect these changes
for all periods presented. There was no impact to Dunkin’ Donuts U.S. segment profit as the net operating income earned from
company-owned restaurants was previously included in segment profit.
Dunkin’ Donuts U.S.
Fiscal year Increase (Decrease)
2012 2011 $ %
(In thousands, except percentages)
Royalty income $ 337,170 317,203 19,967 6.3 %
Franchise fees 29,445 29,905 (460) (1.5)%
Rental income 92,049 86,590 5,459 6.3 %
Sales at company-owned restaurants 22,765 11,764 11,001 93.5 %
Other revenues 3,970 4,030 (60) (1.5)%
Total revenues $ 485,399 449,492 35,907 8.0 %
Segment profit $ 355,274 334,308 20,966 6.3 %
The increase in Dunkin’ Donuts U.S. revenues for fiscal year 2012 was primarily driven by an increase in royalty income of
$20.0 million as a result of an increase in systemwide sales, as well as an increase in sales at company-owned restaurants of
$11.0 million as a result of company-owned stores acquired during 2012 and the full year impact of company-owned stores
acquired at the end of 2011. An increase in rental income of $5.5 million also contributed to the increase in Dunkin' Donuts
U.S. revenues. Overall, Dunkin' Donuts U.S. revenues were unfavorably impacted by approximately $6.4 million as a result of
the extra week in the prior year.
The increase in Dunkin’ Donuts U.S. segment profit for fiscal year 2012 was primarily driven by the increases in royalty
income and rental income totaling $25.4 million, offset by an increase in personnel costs of $4.5 million primarily related to
continued investment in our Dunkin’ Donuts U.S. contiguous growth strategy and higher projected incentive compensation
payouts.
Dunkin’ Donuts International
Fiscal year Increase (Decrease)
2012 2011 $ %
(In thousands, except percentages)
Royalty income $ 13,474 12,657 817 6.5 %
Franchise fees 1,715 2,294 (579) (25.2)%
Rental income 179 258 (79) (30.6)%
Other revenues 117 44 73 165.9 %
Total revenues $ 15,485 15,253 232 1.5 %
Segment profit $ 9,670 11,528 (1,858) (16.1)%
The increase in Dunkin’ Donuts International revenue for fiscal year 2012 resulted primarily from an increase in royalty income
of $0.8 million driven by the increase in systemwide sales, slightly offset by a decrease of $0.6 million in franchise fees as a
result of the prior year including a deposit retained from a former licensee in Mexico and fewer store openings.
The decrease in Dunkin’ Donuts International segment profit for fiscal year 2012 was primarily driven by a $3.4 million
increase in general and administrative costs primarily as a result of investments in personnel and advertising. Offsetting this