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2015 ANNUAL REPORT
DineEquity®
A BOLD
NEW
CHAPTER

Table of contents

  • Page 1
    DineEquity A BOLD NEW CHAPTER 2015 ANNUAL REPORT ®

  • Page 2
    2

  • Page 3
    ... a lot of things. Iconic, heritage brands, and a proven methodology for keeping them relevant. A collaborative approach to innovation, with some of the best franchisees in the business. Disciplined financial management, and a track record of delivering what we promise. Today, we're putting a fresh...

  • Page 4
    ... next chapter means driving organic growth. The work to position our company for future success has included the successful restructuring of long-term debt and sale of the remaining Applebee's company-owned restaurants in Kansas City. We have made significant investments internally in an accelerated...

  • Page 5
    ...Applebee's and IHOP brands wherever, whenever and however they choose. This includes developing more restaurants domestically and internationally, while also expanding the types of settings in which our brands can be found by putting them in unique places. We've made substantial progress on a number...

  • Page 6
    ... we unveiled the bold initiatives 4 2. For fiscal years ended December 31, 2013, 2014, and 2015, respectively, "Free cash flow" for a given period is defined as cash provided by operating activities, plus receipts from notes and equipment contracts receivable, less capital expenditures. (See non...

  • Page 7
    ... in the first six years since the acquisition • Implemented a Shared Services model to create a more efficient, effective infrastructure • Reduced capital expenditures • Formed a purchasing cooperative, Centralized Supply Chain Services, LLC • Returned a meaningful portion of free cash to...

  • Page 8
    Welcome to our bold new chapter.

  • Page 9
    New stories for our beloved brands. New locations, prototypes and remodels. New guest experiences. New levels of collaboration. New benchmarks for sustainable, organic growth. New opportunities for our business, brands, guests, team members, franchisees and shareholders. This is our plan for growth.

  • Page 10
    ... guests they serve every day. We are renewing our commitment to the guest experience by implementing several initiatives to improve operations and enhance the quality of the food, service and the restaurant environment. We have streamlined and simplified the menu to allow Applebee's kitchens to more...

  • Page 11
    ... the IHOP menu in ways that reflect the qualities at the heart of the brand, with a pipeline of fully developed and tested new foods to be enjoyed throughout the day. We also substantially evolved the IHOP guest experience in 2015. Inside the restaurants, we've instituted measures to deliver a great...

  • Page 12
    Connecting with guests wherever, whenever and however. IHOP test remodel; Cincinnati, Ohio 10

  • Page 13
    ... domestic and international teams, and we anticipate working together even more closely as we consolidate to a single location. Our holistic, strategic approach to development has shaped prototypes, development strategies and consumer segmentation for our domestic and international markets. Looking...

  • Page 14
    ... restaurants in innovative places where guests want us, but where we are not today. We see small format, non-traditional locations as major drivers of future growth, because they enable us to leverage our international strategies to more deeply penetrate high-cost real estate markets like New York...

  • Page 15
    ...on a few key markets in the The international brand strategies regions in which we operate. With also inspired the creation of new 25 gross international restaurant restaurant prototypes. In late 2015, openings, and 16 new development we opened the first IHOP prototype agreements, which represent 94...

  • Page 16
    Expanding our commitment to our communities National Pancake Day has raised nearly $20 million since its inception in 2006. 14

  • Page 17
    ... NATIONAL PANCAKE DAY On November 5, 2015, we celebrated our eighth annual Veterans Day event, honoring current and former United States military personnel with free meals at all of the nearly 2,000 Applebee's restaurants nationwide. In addition, Applebee's supports the Thank You Movement Web site...

  • Page 18
    ... President, Human Resources, Communications and Public Affairs Daniel del Olmo President, International Jim Anhut Senior Vice President, Development Darren Rebelez President, IHOP Business Unit BOARD OF DIRECTORS Julia A. Stewart Chairman and Chief Executive Officer, DineEquity, Inc. Stephen...

  • Page 19
    Form 10-K

  • Page 20

  • Page 21
    ... the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date. Class Common Stock, $.01 par value Outstanding as of February 19, 2016 18,528,346 DOCUMENTS INCORPORATED BY REFERENCE Portions of the Proxy Statement for the Annual Meeting...

  • Page 22
    ... about Market Risk...Item 8-Financial Statements and Supplementary Data ...Item 9-Changes in and Disagreements with Accountants on Accounting and Financial Disclosure...Item 9A-Controls and Procedures ...Item 9B-Other Information ...PART III. Item 10-Directors, Executive Officers and Corporate...

  • Page 23
    ... highly franchised business model requires less capital investment and general and administrative overhead, generates higher gross profit margins and reduces the volatility of free cash flow performance, as compared to owning a significant number of company-operated restaurants. We generate revenue...

  • Page 24
    ... sources arranged for by the franchise developer to purchase or lease a restaurant site, build and equip the business and fund its working capital needs. We refer to this as our "Current IHOP Business Model." The first restaurant in what became the Applebee's chain opened in 1980 in Decatur, Georgia...

  • Page 25
    ... credited) for each restaurant developed under a multi-restaurant development agreement, in each case paid upon execution of the franchise agreement; (c) franchise royalties equal to 4.5% of weekly gross sales; (d) revenue from the sale of pancake and waffle dry-mixes; and (e) franchise advertising...

  • Page 26
    ... segment revenue for the year ended December 31, 2015 consisted of Applebee's and IHOP royalties and IHOP advertising revenue. Most of the remaining 12% consisted of sales of proprietary products (primarily IHOP pancake and waffle dry-mixes), franchise fees and software maintenance and support fees...

  • Page 27
    ... have different requirements for restaurants opened outside of the United States. We also monitor the financial health of our franchisees through business and financial reviews. Composition of Franchise Systems As of December 31, 2015, there were 32 Applebee's franchisees that owned a total of 1,878...

  • Page 28
    ... committed to purchase substantially all goods, equipment and distribution services for company-operated restaurants through the CSCS supply chain program. As of December 31, 2015, 100% of Applebee's domestic franchise restaurants and 99% of IHOP domestic franchise restaurants were members of CSCS...

  • Page 29
    ... our company restaurants. In addition, we have several consumer-facing technology initiatives focused on improving our customers' experience. Sales and product mix information is transmitted to our restaurant support centers on a daily basis and this information supports our operations and marketing...

  • Page 30
    ... that chain restaurants include calorie information on their menus or make other nutritional information available. Initiatives in the area of nutrition disclosure or advertising, such as requirements to provide information about the nutritional content of our food, may result in increased costs of...

  • Page 31
    ... such as lower residential real estate values, increased foreclosure rates, increased tax rates or other economic disruptions), our business could experience a decline in sales and/or customer traffic as potential customers choose lower-cost alternatives (such as quick-service restaurants) or choose...

  • Page 32
    ...manipulation of sales reporting from our restaurants resulting in loss of sales and royalty payments, or a breach in security of these systems could be harmful and cause delays in customer service and reduce efficiency in our operations. Significant capital investments might be required to remediate...

  • Page 33
    ... an impairment charge. Fair values of goodwill and intangible assets are primarily estimated using discounted cash flows based on five-year forecasts of financial results that incorporate assumptions as to same-restaurant sales trends, future development plans and brand-enhancing initiatives, among...

  • Page 34
    ...(iii) increases in other operating costs including advertising, utilities, leaserelated expenses and credit card processing fees; • the highly competitive nature of the restaurant industry with respect to, among other things: (i) price, service, location, personnel and the type and quality of food...

  • Page 35
    ... confidential information, and/or damage to our employee and business relationships, all of which could subject us to loss and harm our brands." Changing health or dietary preferences may cause consumers to avoid Applebee's and IHOP's products in favor of alternative foods. The food service industry...

  • Page 36
    ...be able to adequately adapt Applebee's or IHOP restaurants' menu offerings to keep pace with developments in consumer preferences, which may result in reductions to the franchise payments we receive from franchisees and the revenues generated by our company-operated restaurants. We face a variety of...

  • Page 37
    ...United States. Other labor shortages or increased team member turnover could also increase labor costs. In addition, our vendors may be affected by higher minimum wage standards or availability of labor, which may increase the price of goods and services they supply to us. We continue to accommodate...

  • Page 38
    ... to support our marketing programs and strategic initiatives; inability to participate in business strategy changes due to financial constraints; inability to meet rent obligations on leases on which we retain contingent liability; failure to operate restaurants in accordance with required standards...

  • Page 39
    ... over a 25-year period. Therefore, in addition to franchise fees and royalties, the revenues received from an IHOP franchisee operating under the Previous IHOP Business Model include, among other things, lease or sublease rents for the restaurant property building, rent under an equipment lease and...

  • Page 40
    ... footprint, restaurants located in non-traditional locations, our IHOP coffee kiosk and retail product licensing for the IHOP brand could create new risks to our brand and reputation. Failure of our internal controls over financial reporting and future changes in accounting standards may cause...

  • Page 41
    ... pay, meal and rest breaks, unemployment tax rates, workers' compensation regulations, citizenship or residency requirements, child labor requirements, sales taxes and other employment-related matters may have an adverse effect on our business or operations. In addition, employee claims based...

  • Page 42
    Item 2. Properties. The table below shows the location and ownership type of Applebee's and IHOP restaurants as of December 31, 2015: Franchise Applebee's (a) Company Total Franchise IHOP (a) Company Area License Total United States Alabama ...Alaska ...Arizona...Arkansas...California ...Colorado...

  • Page 43
    ... defaults in the payment of rent or other terms of the sublease. We currently occupy our principal corporate offices and IHOP restaurant support center in Glendale, California, under a lease expiring in April 2023. The Applebee's restaurant support center was located in Kansas City, Missouri under...

  • Page 44
    ... Purchases of Equity Securities. Market Information Our common stock is traded on the NYSE under the symbol "DIN". The following table sets forth the high and low sales prices of our common stock on the NYSE for each fiscal quarter of 2015 and 2014. Fiscal Year 2015 Prices High Low Fiscal Year 2014...

  • Page 45
    ...by the Company Total number of shares purchased (b) Average price paid per share (b) Total number of shares purchased as part of publicly announced plans or programs (c) Approximate dollar value of shares that may yet be purchased under the plans or programs (c) Period September 28, 2015 - October...

  • Page 46
    ...periods should not be considered indicative of future stock prices or stockholder returns. Comparison of Five-Year Cumulative Total Stockholder Return DineEquity, Inc., Standard & Poor's 500 and Value Line Restaurant Index (Performance Results through December 31, 2015) 2010 2011 2012 2013 2014...

  • Page 47
    ... financial statements. Fiscal Year Ended December 31, 2015 2014 2013 2012 2011 (In millions, except per share amounts and restaurant data) Revenues: Franchise and restaurant revenues (a) ...Rental revenues ...Financing revenues...Total revenues...Cost of revenues: Franchise and restaurant...

  • Page 48
    ... consolidated financial statements and the related notes that appear elsewhere in this report. Business Overview The Company The first International House of Pancakes restaurant opened in 1958 in Toluca Lake, California. Shortly thereafter, the Company's predecessor began developing and franchising...

  • Page 49
    ... at those restaurants will drive franchise revenues in the form of higher royalty revenues, additional franchise fees and, in the case of IHOP restaurants, sales of proprietary pancake and waffle dry mix. Net Franchise Restaurant Development The number of new franchise restaurants opened by Applebee...

  • Page 50
    ...past three years: 2015 Year Ended December 31, 2014 2013 Applebee's Restaurant Development Activity Summary - beginning of period: Franchise ...Company ...Total Applebee's restaurants, beginning of period...Franchise restaurants opened: Domestic ...International...Total franchise restaurants opened...

  • Page 51
    ...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. Year Ended December 31, 2014 2013 2015 Applebee's Restaurant Data Effective Restaurants:(a) Franchise...Company...Total...

  • Page 52
    ...in average customer check substantially offset by a decrease in customer traffic. Applebee's performance for both the fourth quarter and full year of 2015 lagged that of the casual dining segment of the restaurant industry. Based on data from Black Box Intelligence, a restaurant sales reporting firm...

  • Page 53
    ...from an increase in menu prices, a favorable change in product sales mix, or a combination thereof. A sustained decline in same-restaurant customer traffic that cannot be offset by an increase in average customer check could have an adverse effect on our business, results of operations and financial...

  • Page 54
    .... The amended advertising contribution percentage is also applicable to IHOP company-operated restaurants. This change increased total franchise revenue by $10.5 million and $5.9 million in 2015 and 2014, respectively. Consolidation of Kansas City Restaurant Support Center In September 2015, we...

  • Page 55
    ...-restaurant sales on franchise royalties and rental revenue. Approximately $9.4 million of the increase was due to a 53rd calendar week in fiscal 2015. New restaurant development by franchisees of both brands also contributed to the increase. The improvement in gross profit for 2014 compared to 2013...

  • Page 56
    ...during 2014. The impact on franchise revenue of these declines was partially offset by a 1.1% increase in Applebee's domestic same-restaurant sales, a higher effective royalty rate and an increase in franchise fees due to more restaurant openings in 2014 than in 2013. In 2014, we received a total of...

  • Page 57
    IHOP franchise expenses (other than advertising) increased in 2014 compared to 2013, primarily due to higher purchases of pancake and waffle dry mix and increases in other franchise operating costs. These unfavorable variances were partially offset by lower bad debt expense in 2014. IHOP's total ...

  • Page 58
    ... also operated 23 Applebee's restaurants in the Kansas City, Missouri market area for the entire year in 2014 and 2013, but for only seven months in 2015 prior to the refranchising described under "Events Impacting Comparability of Financial Information." Because of the refranchising, company sales...

  • Page 59
    ... "Events Impacting Comparability of Financial Information - Consolidation of Kansas City Restaurant Support Center." In addition, costs of professional services increased $2.3 million and certain payroll tax credits declined $1.3 million. Salary and benefits costs increased because several executive...

  • Page 60
    ... credit agreement in effect at that time. Gain or Loss on Disposition of Assets As discussed under "Events Impacting Comparability of Financial Information," we recognized a gain of $2 million from the refranchising and sale of related restaurant assets of 23 Applebee's company-operated restaurants...

  • Page 61
    ...Term Debt Transaction Summary On September 30, 2014, Applebee's Funding LLC and IHOP Funding LLC (each a "Co-Issuer"), each a special purpose, wholly-owned indirect subsidiary of the Company, issued $1.3 billion of Series 2014-1 4.277% Fixed Rate Senior Notes, Class A-2 (the "Class A-2 Notes") in an...

  • Page 62
    ...dated as of September 30, 2014 (the "Variable Funding Note Purchase Agreement"), among the Co-Issuers, the Guarantors, certain conduit investors, financial institutions and funding agents, and Cooperatieve Centrale Raiffeisen-Boerenleenbank, B.A. ("Rabobank Nederdland"), New York Branch, as provider...

  • Page 63
    ... assets of the Company and its subsidiaries, which principally consist of franchise agreements, area license agreements, development agreements, franchisee fee notes, equipment leases, agreements related to the production and sale of pancake and waffle dry-mixes, owned and leased real property and...

  • Page 64
    ... operations. Franchise revenues primarily consist of royalties and franchise fees from Applebee's and IHOP franchised restaurants, IHOP advertising fees and sales of proprietary products by IHOP, each of which fluctuates with increases or decreases in franchise retail sales. Franchise retail sales...

  • Page 65
    ... in free cash flow in 2014 compared to 2013 was primarily due to the decrease in cash provided by operating activities discussed above. At December 31, 2015, our cash and cash equivalents totaled $144.8 million, including $72.3 million of cash held for gift card programs and IHOP advertising funds...

  • Page 66
    ... Financial Statements included in this report. On February 23, 2016, our Board of Directors approved payment of a cash dividend of $0.92 per share of common stock, payable at the close of business on April 8, 2016 to the stockholders of record as of the close of business on March 18, 2016. Share...

  • Page 67
    ...initial services required by the franchise agreement. Fees from development agreements are deferred and recorded into income as restaurants under the development agreement are opened. Sales by company-operated restaurants are recognized when food and beverage items are sold. Company restaurant sales...

  • Page 68
    ... to determine fair value under the discounted cash flows model include future trends in sales, operating expenses, overhead expenses, depreciation, capital expenditures and changes in working capital, along with an appropriate discount rate based on our estimated cost of equity capital and after-tax...

  • Page 69
    ...determine the allowance based on historical experience, current payment patterns, future obligations and our assessment of the ability to pay outstanding balances. The primary indicator of credit quality is delinquency, which is considered to be a receivable balance greater than 90 days past due. We...

  • Page 70
    ... governing share-based payments. Accordingly, we measure stock-based compensation expense at the grant date, based on the fair value of the award, and recognize the expense over the employee's requisite service period using the straight-line method. The fair value of each employee stock option and...

  • Page 71
    ... IHOP franchise restaurants are members of CSCS, a Co-op that manages procurement activities for the Applebee's and IHOP restaurants that belong to the Co-op. We believe the larger scale created by combining the supply chain requirements of both brands under one organization can provide cost savings...

  • Page 72
    ...Financial Statements Page Reference Report of Independent Registered Public Accounting Firm ...Consolidated Balance Sheets as of December 31, 2015 and 2014 ...Consolidated Statements of Comprehensive Income for each of the three years in the period ended December 31, 2015 ...Consolidated Statements...

  • Page 73
    ... have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), DineEquity, Inc. and Subsidiaries' internal control over financial reporting as of January 3, 2016, based on criteria established in Internal Control-Integrated Framework issued by the...

  • Page 74
    ... Subsidiaries Consolidated Balance Sheets (In thousands, except share amounts) December 31, 2015 2014 Assets Current assets: Cash and cash equivalents ...Receivables, net ...Restricted cash ...Prepaid gift card costs...Prepaid income taxes ...Other current assets...Total current assets...Long-term...

  • Page 75
    ... per share amounts) Year Ended December 31, 2015 2014 2013 Revenues: Franchise and restaurant revenues...$ Rental revenues ...Financing revenues...Total revenues ...Cost of revenues: Franchise and restaurant expenses ...Rental expenses ...Financing expenses ...Total cost of revenues...Gross profit...

  • Page 76
    ... Statements of Stockholders' Equity (In thousands) Common Stock Shares Outstanding Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Treasury Stock Amount Shares Cost Total Balance at December 31, 2012 ...Net income ...Other comprehensive loss ...Purchase...

  • Page 77
    ...Accrued employee compensation and benefits ...Accrued interest payable ...Other current liabilities...Cash flows provided by operating activities...Cash flows from investing activities Principal receipts from notes, equipment contracts and other longterm receivables ...Proceeds from sale of property...

  • Page 78
    ...to the Consolidated Financial Statements 1. The Company The first International House of Pancakes® ("IHOP") restaurant opened in 1958 in Toluca Lake, California. Shortly thereafter, the Company began developing and franchising additional restaurants. The Company was incorporated as IHOP Corp. under...

  • Page 79
    ... at cost which approximates market value. Cash held related to IHOP advertising funds and the Company's gift card programs is classified as unrestricted cash as there are no restrictions on the use of these funds. Total cash balances related to the IHOP advertising funds and the Company's gift card...

  • Page 80
    ...used to determine fair value under the discounted cash flow model included future trends in sales, operating expenses, overhead expenses, capital expenditures and changes in working capital, along with an appropriate discount rate based on the Company's estimated cost of equity capital and after-tax...

  • Page 81
    ...initial services required by the franchise agreement. Fees from development agreements are deferred and recorded into income as restaurants under the development agreement are opened. Sales by company-operated restaurants are recognized when food and beverage items are sold. Company restaurant sales...

  • Page 82
    ... advertising costs incurred by the Company to benefit future franchise operations. Costs of advertising are expensed either as incurred or the first time the advertising takes place. Advertising expense included in company restaurant operations for the years ended December 31, 2015, 2014 and 2013...

  • Page 83
    ... reporting period, management applies a consistent methodology to measure and adjust all uncertain tax positions based on the available information. Stock-Based Compensation Members of the Board of Directors and certain employees are eligible to receive stock options, restricted stock, restricted...

  • Page 84
    ...nine countries outside of the United States. Franchise operations revenue consists primarily of franchise royalty revenues, sales of proprietary products (primarily IHOP pancake and waffle dry-mixes) and franchise fees. Additionally, franchise fees designated for IHOP's national advertising fund and...

  • Page 85
    ... franchise royalty revenues, sales of IHOP pancake and waffle dry mix and retail sales at company-operated restaurants will not be affected by the new guidance. Additionally, lease rental revenues are not within the scope of the new guidance. The Company is currently evaluating the impact of the new...

  • Page 86
    ... is not charged on gift card receivables. Financing receivables primarily relate to IHOP franchise development activity prior to 2003 when IHOP typically leased or purchased the restaurant site, built and equipped the restaurant then franchised the restaurant to a franchisee. IHOP provided the...

  • Page 87
    ... 31, 2015 and 2014, the balance of goodwill was $697.5 million, of which $686.7 million has been allocated to the Applebee's franchise reporting unit and $10.8 million to the IHOP franchise reporting unit. The Company assessed goodwill for impairment in accordance with its policy described in...

  • Page 88
    ....5 $ 1,300.0 (23.5) 1,276.5 On September 30, 2014, Applebee's Funding LLC and IHOP Funding LLC (each a "Co-Issuer"), each a special purpose, wholly-owned indirect subsidiary of the Company issued $1.3 billion of Series 2014-1 4.277% Fixed Rate Senior Notes, Class A-2 (the "Class A-2 Notes") in an...

  • Page 89
    ..., which principally consist of franchise agreements, area license agreements, development agreements, franchisee fee notes, equipment leases, agreements related to the production and sale of pancake and waffle dry-mixes, owned and leased real property and intellectual property. The Notes are...

  • Page 90
    ...provided for in the Indenture, including events tied to failure of the Securitization Entities to maintain the stated debt service coverage ("DSCR") ratio, the sum of domestic retail sales for all restaurants being below certain levels on certain measurement dates, certain manager termination events...

  • Page 91
    ...Consolidated Financial Statements (Continued) 8. Financing Obligations On May 19, 2008, the Company entered into a Purchase and Sale Agreement relating to the sale and leaseback of 181 parcels of real property (the "Sale-Leaseback Transaction"), each of which is improved with a restaurant operating...

  • Page 92
    ... varying closing date of the Company's fiscal year, 11 monthly payments will be made in fiscal 2017. Included in current maturities of capital lease and financing obligations on the consolidated balance sheet. The asset cost and carrying amount on company-owned property leased at December 31, 2015...

  • Page 93
    ... noncancelable operating leases for the years ended December 31, 2015, 2014 and 2013 was $80.9 million, $75.9 million and $75.4 million, respectively. 10. Commitments and Contingencies Purchase Commitments In some instances, the Company enters into commitments to purchase advertising and other items...

  • Page 94
    ... settle in stock upon vesting. The cost of treasury stock re-issued is determined on the first-in, first-out ("FIFO") method. The Company re-issued 356,930 shares, 359,528 shares and 318,644 shares, respectively, during the years ended December 31, 2015, 2014 and 2013 at a total FIFO cost of $12...

  • Page 95
    ... charges for the year ended December 31, 2014 related primarily to two IHOP company-operated restaurants in the Cincinnati, Ohio area. Long-lived tangible asset impairment charges for the year ended December 31, 2013 related to three Applebee's company-operated restaurants in the Kansas City...

  • Page 96
    ...the closing price of the Company's common stock on the New York Stock Exchange on the date of grant. Restricted stock and restricted stock units are issued at no cost to the holder and vest over terms determined by the Compensation Committee of the Company's Board of Directors, generally three years...

  • Page 97
    ... the fair values generated by the model may not be indicative of the actual fair values of the Company's stock-based awards. The following table summarizes the assumptions used to value options granted in the respective periods: 2015 2014 2013 Risk free interest rate ...Weighted average historical...

  • Page 98
    ... stock and restricted stock units for the years ended December 31, 2015, 2014 and 2013 is as follows: Weighted Average Grant-Date Per Share Fair Value Weighted Average Grant-Date Per Share Fair Value Shares of Restricted Stock Restricted Stock Units Outstanding at December 31, 2012 ...Granted...

  • Page 99
    ... the second quarter of 2013, the Internal Revenue Service ("IRS") issued a Revenue Agent's Report ("RAR") related to its examination of the Company's U.S federal income tax return for the tax years 2008 to 2010. The Company disagrees with a portion of the proposed assessments and has contested them...

  • Page 100
    ... as of both December 31, 2015 and 2014 related to the Massachusetts enacted legislation requiring unitary businesses to file combined reports. As of each reporting date, the Company's management considers new evidence, both positive and negative, that could impact management's view with regards to...

  • Page 101
    ... its headquarters in Glendale, California and communicated the plan to employees. In conjunction with this action, the Company will exit a significant portion of the Applebee's restaurant support center in Kansas City, Missouri. The Company estimates it will incur a total of approximately $8 million...

  • Page 102
    ... Consolidated Financial Statements (Continued) 18. Segment Reporting Information on segments and a reconciliation to income (loss) before income taxes are as follows: Year Ended December 31, 2014 (In millions) 2015 2013 Revenues Franchise operations ...$ Rental operations...Company restaurants...

  • Page 103
    ... to the Consolidated Financial Statements (Continued) 19. Selected Quarterly Financial Data (Unaudited) Net Income (Loss) Per Share- Basic(3) Net Income (Loss) Per Share- Diluted(3) Revenues Operating Margin Net Income (Loss) (In thousands, except per share amounts) 2015 1st Quarter ...$ 2nd...

  • Page 104
    ... and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. In designing...

  • Page 105
    ... respects, effective internal control over financial reporting as of January 3, 2016, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the accompanying consolidated balance sheets of DineEquity...

  • Page 106
    ... over financial reporting. Item 9B. None. PART III Item 10. Directors, Executive Officers and Corporate Governance. Other Information. The information required by this Item regarding our directors and executive officers is incorporated by reference to our Proxy Statement for the 2016 Annual Meeting...

  • Page 107
    ... Part II, Item 8 of this Annual Report on Form 10-K Reports of Independent Registered Public Accounting Firm. Consolidated Balance Sheets as of December 31, 2015 and 2014. Consolidated Statements of Comprehensive Income for each of the three years in the period ended December 31, 2015. Consolidated...

  • Page 108
    ... Incentive Plan Non-qualified Stock Option Agreement (Exhibit 10.15 to Registrant's 2003 Form 10-K is incorporated herein by reference). †10.25 IHOP Corp. 2005 Stock Incentive Plan for Non-Employee Directors (Appendix "A" to Registrant's Proxy Statement for the Annual Meeting of Stockholders held...

  • Page 109
    ....) 10.35 Management Agreement, dated September 30, 2014, among Applebee's Funding LLC and IHOP Funding LLC, each as a Co-Issuer, other securitization entities party thereto from time to time, the Registrant, Applebee's Services, Inc. and International House of Pancakes, LLC, as sub-managers, and...

  • Page 110
    ... Patrick W. Rose Chairman and Chief Executive Officer (Principal Executive Officer) Chief Financial Officer (Principal Financial Officer) Senior Vice President, Corporate Controller (Principal Accounting Officer) Director Director Director Director Director Director Director Director Director 90

  • Page 111
    ... 56,741 5.40 Definitions of all components used in calculating the above ratios are found in the Base Indenture and the related Series 2014-1 Supplement to the Base Indenture, dated September 30, 2014, filed as Exhibits 4.1 and 4.2, respectively, to our Current Report on Form 8-K filed on October...

  • Page 112
    ..., Inc...DineEquity International, Inc...International House of Pancakes, LLC...III Industries of Canada, LTD...IHOP of Canada ULC...IHOP TPGC, LLC ...IHOP SPV Guarantor, LLC...IHOP Funding, LLC...IHOP Restaurants, LLC...IHOP Franchisor, LLC ...IHOP Property, LLC...IHOP Leasing, LLC...ACM Cards, Inc...

  • Page 113
    ... pertaining to the IHOP Corp. 2005 Stock Incentive Plan for Non-Employee Directors; and Form S-8 No. 333-174847 pertaining to the DineEquity, Inc. 2011 Stock Incentive Plan • • of our reports dated February 24, 2016, with respect to the consolidated financial statements of DineEquity, Inc...

  • Page 114
    ... information; and Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ JULIA A. STEWART Julia A. Stewart Chairman and Chief Executive Officer (b) Date: February 24, 2016

  • Page 115
    ...; and Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ THOMAS W. EMREY Thomas W. Emrey Chief Financial Officer (Principal Financial Officer) b. Date: February 24, 2016

  • Page 116
    ...1934, as amended; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: February 24, 2016 /s/ JULIA A . STEWART Julia A. Stewart Chairman and Chief Executive Officer _____ This certification...

  • Page 117
    ...of 2002 In connection with the Annual Report on Form 10-K of DineEquity, Inc. (the "Company") for the year ended December 31, 2015, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Thomas W. Emrey, as Chief Financial Officer of the Company, do hereby certify...

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    .... Pursuant to Rule 303A.12 of the New York Stock Exchange Listed Companies Manual, each listed company CEO must certify to the NYSE each year that he or she is not aware of any violation by the company of NYSE corporate governance listing standards. Julia Stewart's annual CEO certification regarding...

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