Papa Johns 2007 Annual Report Download - page 43

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36
We have classified our Perfect Pizza operations as discontinued operations in the accompanying financial
statements. The following summarizes the results of the discontinued operations for the year ended
December 31, 2006 (in thousands, except per share data):
2006
Net sales 2,421$
Operating expenses 1,449
G&A expenses 330
Other expenses 25
Income before income taxes 617
Income tax expense 228
Net income from discontinued operations 389$
Basic earnings per common share 0.01$
Earnings per common share - assuming dilution 0.01$
Summary of Operating Results from Continuing Operations
The Company follows a fiscal year ending on the last Sunday of December, generally consisting of 52
weeks made up of four 13-week quarters. The 13-week quarters consist of two four-week periods
followed by one five-week period. In 2006, the Company’s fiscal year consisted of 53 weeks, with the
additional week added to the fourth quarter (14 weeks) results. The additional week resulted in additional
revenues of approximately $20.0 million and additional pre-tax income of approximately $3.5 million, or
$0.07 per diluted share for both the fourth quarter and full year of 2006.
Total revenues, which increased 6.2% to $1.06 billion in 2007 compared to $1.00 billion in 2006,
primarily consisted of the following:
• Company-owned restaurant sales increased $56.4 million due to an increase in equivalent units
reflecting the acquisition of 61 domestic restaurants during 2007 and 57 domestic restaurants
during 2006, partially offset by the impact of the 53rd week of operations in 2006 ($9.0 million).
“Comparable sales” represents sales generated by restaurants open for the entire twelve-month
period reported. “Equivalent units” represents the number of restaurants open at the beginning of
a given period, adjusted for restaurants opened, closed, acquired or sold during the period on a
weighted average basis.
• Domestic commissary sales decreased $14.0 million, or 3.4% from 2006 revenues, due to the
impact of the 53rd week of operations in 2006 and the impact of fewer equivalent franchised units
due to the Company’s acquisition of 118 restaurants from franchisees during 2006 and 2007
(sales to Company-owned units are eliminated in consolidation).
• Other sales increased $11.3 million, or 22.4% from 2006 revenues, due to expanded commercial
sales at our print and promotions operations and an increase in online sales.
• International revenues increased $8.0 million primarily as a result of the acquisition of
restaurants in Beijing, China in December 2006, increased royalty revenues from additional
franchised units and increased commissary sales at our PJUK subsidiary.