Jack In The Box 2010 Annual Report Download - page 26

Download and view the complete annual report

Please find page 26 of the 2010 Jack In The Box 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 93

  • 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

Table of Contents

Earnings from continuing operations were $70.2 million, or $1.26 per diluted share, in 2010; $131.0 million, or $2.27 per diluted
share, in 2009; and $118.2 million, or $1.99 per diluted share, in 2008. We estimate that the extra 53rd week benefitted net earnings by
approximately $1.8 million, or $0.03 per diluted share, in fiscal 2010.

As described in the “Financial Reporting” section, Quick Stuff’s results of operations have been reported as discontinued operations.
In 2009, the loss from discontinued operations, net was $12.6 million, reflecting the $15.0 million net of tax loss from the sale of Quick
Stuff in the fourth quarter. Earnings from discontinued operations, net were $1.1 million in 2008.

General. Our primary sources of short-term and long-term liquidity are expected to be cash flows from operations, the revolving bank
credit facility, the sale of company-operated restaurants to franchisees and the sale and leaseback of certain restaurant properties.
Our cash requirements consist principally of:
• working capital;
• capital expenditures for new restaurant construction and restaurant renovations;
• income tax payments;
• debt service requirements; and
• obligations related to our benefit plans.
Based upon current levels of operations and anticipated growth, we expect that cash flows from operations, combined with other
financing alternatives in place or available, will be sufficient to meet our capital expenditure, working capital and debt service
requirements for the foreseeable future.
As is common in the restaurant industry, we maintain relatively low levels of accounts receivable and inventories and our vendors
grant trade credit for purchases such as food and supplies. We also continually invest in our business through the addition of new units
and refurbishment of existing units, which are reflected as long-term assets and not as part of working capital. As a result, we typically
maintain current liabilities in excess of current assets, which results in a working capital deficit.
Cash and cash equivalents decreased $42.4 million to $10.6 million at October 3, 2010 from $53.0 million at the beginning of the
fiscal year. This decrease is primarily due to repurchases of common stock, net repayments under our credit facility, and property and
equipment expenditures. These uses of cash were offset in part by proceeds from the sale and leaseback of restaurant properties, cash
flows provided by operating activities, and proceeds and collections of notes receivable from the sale of restaurants to franchisees. We
generally reinvest available cash flows from operations to develop new restaurants or enhance existing restaurants, to reduce debt and to
repurchase shares of our common stock.
25