Baskin Robbins 2015 Annual Report Download - page 47

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-37-
gift card balances recorded in fiscal year 2013, and a decrease in net income of equity method investments primarily from our
Japan and South Korea joint ventures in fiscal year 2014. Also contributing to the growth in operating income for fiscal year
2014 was a $7.5 million charge related to a third-party product volume guarantee recorded in the prior year.
Net income attributable to Dunkin’ Brands increased $29.5 million, or 20.0%, for fiscal year 2014 as a result of the $34.1
million increase in operating income and a $12.0 million decrease in net interest expense due to the refinancing of our term
loans in February 2014. These increases were offset by an $8.7 million increase in loss on debt extinguishment and refinancing
transactions and an $8.4 million increase in income tax expense driven by increased profit before tax. The effective tax rate for
fiscal year 2014 was favorably impacted by tax benefits resulting from a restructuring of our Canadian subsidiaries.
Adjusted net income increased $20.4 million, or 12.3%, for fiscal year 2014 resulting primarily from a $25.6 million increase
in adjusted operating income and the $12.0 million decrease in net interest expense, offset by a $17.6 million increase in
income tax expense.
Earnings per share
Earnings per common share and adjusted earnings per common share were as follows:
Fiscal year
2015 2014 2013
Earnings per share:
Common – basic $ 1.10 1.67 1.38
Common – diluted 1.08 1.65 1.36
Diluted adjusted earnings per share 1.93 1.74 1.53
Diluted adjusted earnings per share is calculated using adjusted net income, as defined above, and diluted weighted average
shares outstanding. Diluted adjusted earnings per share is not a presentation made in accordance with GAAP, and our use of the
term diluted adjusted earnings per share may vary from similar measures reported by others in our industry due to the potential
differences in the method of calculation. Diluted adjusted earnings per share should not be considered as an alternative to
earnings per share derived in accordance with GAAP. Diluted adjusted earnings per share has important limitations as an
analytical tool and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP.
Because of these limitations, we rely primarily on our GAAP results. However, we believe that presenting diluted adjusted
earnings per share is appropriate to provide investors with useful information regarding our historical operating results.
The following table sets forth the computation of diluted adjusted earnings per share:
Fiscal year
2015 2014 2013
Adjusted net income $ 187,893 186,113 165,761
Weighted average number of common shares–diluted 97,131,674 106,705,778 108,217,011
Diluted adjusted earnings per share $ 1.93 1.74 1.53
Results of operations
Fiscal year 2015 compared to fiscal year 2014
Consolidated results of operations
Fiscal year Increase (Decrease)
2015 2014 $ %
(In thousands, except percentages)
Franchise fees and royalty income $ 513,222 482,329 30,893 6.4 %
Rental income 100,422 97,663 2,759 2.8 %
Sales of ice cream and other products(1) 115,252 117,484 (2,232) (1.9)%
Sales at company-operated restaurants 28,340 22,206 6,134 27.6 %
Other revenues(1) 53,697 29,027 24,670 85.0 %
Total revenues $ 810,933 748,709 62,224 8.3 %