IHOP 2008 Annual Report Download - page 55

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Restaurant Data
The following table sets forth, for each of the past three years, the number of effective restaurants
in the IHOP system and information regarding the percentage change in sales at those restaurants
compared to the same period in the prior year. ‘‘Effective restaurants’’ are the number of restaurants in
a given period, adjusted to account for restaurants open for only a portion of the period. Information is
presented for all effective restaurants in the IHOP system, which includes restaurants owned by the
Company, as well as those owned by franchisees and area licensees. Sales of restaurants that are owned
by franchisees and area licensees are not attributable to the Company. However, we believe that
presentation of this information is useful in analyzing our revenues because franchisees and area
licensees pay us royalties and advertising fees that are generally based on a percentage of their sales, as
well as rental payments under leases that are usually based on a percentage of their sales. Management
also uses this information to make decisions about future plans for the development of additional
restaurants as well as evaluation of current operations. Pro forma information on Applebee’s restaurant
data and restaurant development and franchising activity is presented in the section entitled ‘‘Pro forma
comparison of the fiscal years ended December 31, 2008 and 2007—Applebee’s’’ herein.
Year Ended December 31,
2008 2007 2006
IHOP Restaurant Data
Effective restaurants(a)
Franchise ........................................... 1,189 1,144 1,095
Company ........................................... 10 12 8
Area license ......................................... 158 158 156
Total ............................................. 1,357 1,314 1,259
System-wide(b)
IHOP sales percentage change(c) .......................... 5.5% 6.9% 7.4%
IHOP same-store sales percentage change(d) ................. 1.5% 2.2% 2.5%
Franchise(b)
IHOP sales percentage change(c) .......................... 5.9% 7.1% 7.5%
IHOP same-store sales percentage change(d) ................. 1.5% 2.2% 2.5%
Area License(b)
IHOP sales percentage change(b)(c) ........................ 3.1% 4.2% 6.5%
(a) ‘‘Effective restaurants’’ are the number of restaurants in a given fiscal period adjusted to account
for restaurants open for only a portion of the period. Information is presented for all effective
restaurants in the IHOP system, which includes restaurants owned by the Company as well as
those owned by franchisees and area licensees.
(b) ‘‘System-wide sales’’ are retail sales of IHOP restaurants operated by franchisees, area licensees
(related to IHOP only) and the Company, as reported to the Company. IHOP franchise restaurant
sales were $2.2 billion, $2.1 billion and $2.0 billion for the fiscal years ended December 31, 2008,
2007 and 2006, respectively. Sales at IHOP area license restaurants were $218.4 million,
$211.9 million and $203.3 million for the fiscal years ended December 31, 2008, 2007 and 2006,
respectively. Franchise restaurant retail sales are sales recorded at restaurants that are owned by
franchisees and area licensees. Franchise restaurant retail sales are useful in analyzing our
franchise revenues because franchisees and area licensees pay us royalties and other fees that are
generally based on a percentage of their sales. Sales at restaurants that are owned by franchisees
and area licensees are not attributable to the Company.
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