Papa Johns 2014 Annual Report Download - page 63

Download and view the complete annual report

Please find page 63 of the 2014 Papa Johns annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 110

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110

50
Forward-Looking Statements
Certain matters discussed in this report, including information within Management’s Discussion and
Analysis of Financial Condition and Results of Operations, constitute forward-looking statements within
the meaning of the federal securities laws. Generally, the use of words such as “expect,” “estimate,”
“believe,” “anticipate,” “will,” “forecast,” “plan,” “project,” or similar words identify forward-looking
statements that we intend to be included within the safe harbor protections provided by the federal
securities laws. Such forward-looking statements may relate to projections or guidance concerning
business performance, revenue, earnings, contingent liabilities, resolution of litigation, commodity costs,
profit margins, unit growth, capital expenditures, and other financial and operational measures. Such
statements are not guarantees of future performance and involve certain risks, uncertainties and
assumptions, which are difficult to predict and many of which are beyond our control. Therefore, actual
outcomes and results may differ materially from those matters expressed or implied in such forward-
looking statements. The risks, uncertainties and assumptions that are involved in our forward-looking
statements include, but are not limited to:
aggressive changes in pricing or other marketing or promotional strategies by competitors, which
may adversely affect sales; and new product and concept developments by food industry
competitors;
changes in consumer preferences or consumer buying habits, including the impact of adverse
general economic conditions;
the impact that product recalls, food quality or safety issues, incidences of foodborne illness, food
contamination and other general public health concerns, including potential epidemics, could
have system-wide on our restaurants or our results;
failure to maintain our brand strength and quality reputation;
the ability of the Company and its franchisees to meet planned growth targets and operate new
and existing restaurants profitably;
increases in or sustained high costs of food ingredients or other restaurant costs. This could
include increased employee compensation, benefits, insurance, tax rates, regulatory compliance
and similar costs; including increased costs resulting from federal health care legislation;
disruption of our supply chain or commissary operations which could be caused by our sole
source of supply of cheese or limited source of suppliers for other key ingredients or more
generally due to weather, drought, disease, geopolitical or other disruptions beyond our control;
increased risks associated with our international operations, including economic and political
conditions, instability in our international markets, fluctuations in currency exchange rates, and
difficulty in meeting planned sales targets and new store growth. This could include our
expansion into emerging or underpenetrated markets, such as China, where we have a Company-
owned presence. Based on prior experience in underpenetrated markets, operating losses are
likely to occur as the market is being established;
the impact of changes in interest rates on the Company or our franchisees;
the credit performance of our franchise loan or guarantee programs;
the impact of the resolution of current or future claims and litigation;
current or proposed legislation impacting our business;
failure to effectively execute succession planning, and our reliance on the multiple roles of our
Founder, Chairman, President and Chief Executive Officer, who also serves as our brand
spokesperson; and
disruption of critical business or information technology systems, and risks associated with
systems failures and data privacy and security breaches, including theft of Company, employee
and customer information.