0001726173-22-000017.txt : 20220506 0001726173-22-000017.hdr.sgml : 20220506 20220506161829 ACCESSION NUMBER: 0001726173-22-000017 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 83 CONFORMED PERIOD OF REPORT: 20220331 FILED AS OF DATE: 20220506 DATE AS OF CHANGE: 20220506 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Biglari Holdings Inc. CENTRAL INDEX KEY: 0001726173 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING PLACES [5812] IRS NUMBER: 823784946 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-38477 FILM NUMBER: 22901325 BUSINESS ADDRESS: STREET 1: 17802 IH 10 WEST STREET 2: SUITE 400 CITY: SAN ANTONIO STATE: TX ZIP: 78257 BUSINESS PHONE: 210-344-3400 MAIL ADDRESS: STREET 1: 17802 IH 10 WEST STREET 2: SUITE 400 CITY: SAN ANTONIO STATE: TX ZIP: 78257 FORMER COMPANY: FORMER CONFORMED NAME: NBHSA Inc. DATE OF NAME CHANGE: 20171221 10-Q 1 bh-20220331.htm 10-Q bh-20220331
0001726173false--12-31Q12022.2http://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityCurrenthttp://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityCurrenthttp://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityNoncurrenthttp://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityNoncurrenthttp://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityCurrenthttp://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityCurrenthttp://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityNoncurrenthttp://bh.com/20200930/20220331#OperatingAndFinanceLeaseLiabilityNoncurrent00017261732022-01-012022-03-310001726173us-gaap:CommonClassAMember2022-01-012022-03-310001726173us-gaap:CommonClassBMember2022-01-012022-03-310001726173us-gaap:CommonClassAMember2022-05-03xbrli:shares0001726173us-gaap:CommonClassBMember2022-05-0300017261732022-03-31iso4217:USD00017261732021-12-310001726173bh:RestaurantOperationsMember2022-01-012022-03-310001726173bh:RestaurantOperationsMember2021-01-012021-03-310001726173bh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:InsuranceOperationsMember2021-01-012021-03-310001726173us-gaap:OilAndGasMember2022-01-012022-03-310001726173us-gaap:OilAndGasMember2021-01-012021-03-310001726173bh:MediaAndLicensingMember2022-01-012022-03-310001726173bh:MediaAndLicensingMember2021-01-012021-03-3100017261732021-01-012021-03-31iso4217:USDxbrli:shares0001726173us-gaap:CommonClassAMember2021-01-012021-03-310001726173us-gaap:CommonClassBMember2021-01-012021-03-31xbrli:pure00017261732020-12-3100017261732021-03-310001726173us-gaap:CommonStockMember2021-12-310001726173us-gaap:AdditionalPaidInCapitalMember2021-12-310001726173us-gaap:RetainedEarningsMember2021-12-310001726173us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001726173us-gaap:TreasuryStockMember2021-12-310001726173us-gaap:RetainedEarningsMember2022-01-012022-03-310001726173us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310001726173us-gaap:TreasuryStockMember2022-01-012022-03-310001726173us-gaap:CommonStockMember2022-03-310001726173us-gaap:AdditionalPaidInCapitalMember2022-03-310001726173us-gaap:RetainedEarningsMember2022-03-310001726173us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310001726173us-gaap:TreasuryStockMember2022-03-310001726173us-gaap:CommonStockMember2020-12-310001726173us-gaap:AdditionalPaidInCapitalMember2020-12-310001726173us-gaap:RetainedEarningsMember2020-12-310001726173us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310001726173us-gaap:TreasuryStockMember2020-12-310001726173us-gaap:RetainedEarningsMember2021-01-012021-03-310001726173us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310001726173us-gaap:TreasuryStockMember2021-01-012021-03-310001726173us-gaap:CommonStockMember2021-03-310001726173us-gaap:AdditionalPaidInCapitalMember2021-03-310001726173us-gaap:RetainedEarningsMember2021-03-310001726173us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310001726173us-gaap:TreasuryStockMember2021-03-310001726173bh:MrBiglariMember2022-03-310001726173us-gaap:CommonClassAMember2022-03-310001726173us-gaap:CommonClassBMember2022-03-310001726173us-gaap:CommonClassAMember2021-12-310001726173us-gaap:CommonClassBMember2021-12-310001726173bh:FairValueMember2021-12-310001726173bh:CompanyCommonStockMember2021-12-310001726173bh:CarryingValueMember2021-12-310001726173bh:FairValueMember2022-01-012022-03-310001726173bh:CompanyCommonStockMember2022-01-012022-03-310001726173bh:CarryingValueMember2022-01-012022-03-310001726173bh:FairValueMember2022-03-310001726173bh:CompanyCommonStockMember2022-03-310001726173bh:CarryingValueMember2022-03-310001726173bh:FairValueMember2020-12-310001726173bh:CompanyCommonStockMember2020-12-310001726173bh:CarryingValueMember2020-12-310001726173bh:FairValueMember2021-01-012021-03-310001726173bh:CompanyCommonStockMember2021-01-012021-03-310001726173bh:CarryingValueMember2021-01-012021-03-310001726173bh:FairValueMember2021-03-310001726173bh:CompanyCommonStockMember2021-03-310001726173bh:CarryingValueMember2021-03-310001726173bh:LionFundMember2022-03-310001726173bh:LionFundIIMember2022-03-310001726173bh:LionFundMember2022-01-012022-03-310001726173bh:LionFundIIMember2022-01-012022-03-310001726173bh:LionFundMember2021-12-310001726173bh:LionFundIIMember2021-12-310001726173bh:LionFundMember2021-01-012021-03-310001726173bh:LionFundIIMember2021-01-012021-03-310001726173bh:LionFundMember2021-03-310001726173bh:LionFundIIMember2021-03-310001726173us-gaap:TrademarksAndTradeNamesMember2021-12-310001726173us-gaap:ContractualRightsMember2021-12-310001726173us-gaap:TrademarksAndTradeNamesMember2022-01-012022-03-310001726173us-gaap:ContractualRightsMember2022-01-012022-03-310001726173us-gaap:TrademarksAndTradeNamesMember2022-03-310001726173us-gaap:ContractualRightsMember2022-03-310001726173bh:RestaurantOperationsMemberus-gaap:ProductMember2022-01-012022-03-310001726173bh:RestaurantOperationsMemberus-gaap:ProductMember2021-01-012021-03-310001726173bh:RestaurantOperationsMemberus-gaap:FranchisorMember2022-01-012022-03-310001726173bh:RestaurantOperationsMemberus-gaap:FranchisorMember2021-01-012021-03-310001726173bh:RestaurantOperationsMemberus-gaap:RoyaltyMember2022-01-012022-03-310001726173bh:RestaurantOperationsMemberus-gaap:RoyaltyMember2021-01-012021-03-310001726173bh:RestaurantOperationsMemberus-gaap:ProductAndServiceOtherMember2022-01-012022-03-310001726173bh:RestaurantOperationsMemberus-gaap:ProductAndServiceOtherMember2021-01-012021-03-310001726173bh:RestaurantOperationsMember2022-01-012022-03-310001726173bh:RestaurantOperationsMember2021-01-012021-03-310001726173bh:SteakNShakeCreditFacilityMember2014-03-190001726173bh:SubleasesMember2022-03-310001726173bh:OwnedPropertiesMember2022-03-310001726173us-gaap:FairValueInputsLevel1Member2022-03-310001726173us-gaap:FairValueInputsLevel2Member2022-03-310001726173us-gaap:FairValueInputsLevel3Member2022-03-310001726173us-gaap:FairValueInputsLevel1Member2021-12-310001726173us-gaap:FairValueInputsLevel2Member2021-12-310001726173us-gaap:FairValueInputsLevel3Member2021-12-310001726173us-gaap:FairValueInputsLevel1Memberbh:ConsumerGoodsEquitySecurityMember2022-03-310001726173us-gaap:FairValueInputsLevel2Memberbh:ConsumerGoodsEquitySecurityMember2022-03-310001726173bh:ConsumerGoodsEquitySecurityMemberus-gaap:FairValueInputsLevel3Member2022-03-310001726173bh:ConsumerGoodsEquitySecurityMember2022-03-310001726173us-gaap:FairValueInputsLevel1Memberbh:ConsumerGoodsEquitySecurityMember2021-12-310001726173us-gaap:FairValueInputsLevel2Memberbh:ConsumerGoodsEquitySecurityMember2021-12-310001726173bh:ConsumerGoodsEquitySecurityMemberus-gaap:FairValueInputsLevel3Member2021-12-310001726173bh:ConsumerGoodsEquitySecurityMember2021-12-310001726173bh:InsuranceEquitySecurityMemberus-gaap:FairValueInputsLevel1Member2022-03-310001726173bh:InsuranceEquitySecurityMemberus-gaap:FairValueInputsLevel2Member2022-03-310001726173bh:InsuranceEquitySecurityMemberus-gaap:FairValueInputsLevel3Member2022-03-310001726173bh:InsuranceEquitySecurityMember2022-03-310001726173bh:InsuranceEquitySecurityMemberus-gaap:FairValueInputsLevel1Member2021-12-310001726173bh:InsuranceEquitySecurityMemberus-gaap:FairValueInputsLevel2Member2021-12-310001726173bh:InsuranceEquitySecurityMemberus-gaap:FairValueInputsLevel3Member2021-12-310001726173bh:InsuranceEquitySecurityMember2021-12-310001726173bh:TechnologyEquitySecurityMemberus-gaap:FairValueInputsLevel1Member2022-03-310001726173bh:TechnologyEquitySecurityMemberus-gaap:FairValueInputsLevel2Member2022-03-310001726173bh:TechnologyEquitySecurityMemberus-gaap:FairValueInputsLevel3Member2022-03-310001726173bh:TechnologyEquitySecurityMember2022-03-310001726173bh:TechnologyEquitySecurityMemberus-gaap:FairValueInputsLevel1Member2021-12-310001726173bh:TechnologyEquitySecurityMemberus-gaap:FairValueInputsLevel2Member2021-12-310001726173bh:TechnologyEquitySecurityMemberus-gaap:FairValueInputsLevel3Member2021-12-310001726173bh:TechnologyEquitySecurityMember2021-12-310001726173us-gaap:FairValueInputsLevel1Memberus-gaap:USTreasuryAndGovernmentMember2022-03-310001726173us-gaap:FairValueInputsLevel2Memberus-gaap:USTreasuryAndGovernmentMember2022-03-310001726173us-gaap:FairValueInputsLevel3Memberus-gaap:USTreasuryAndGovernmentMember2022-03-310001726173us-gaap:USTreasuryAndGovernmentMember2022-03-310001726173us-gaap:FairValueInputsLevel1Memberus-gaap:USTreasuryAndGovernmentMember2021-12-310001726173us-gaap:FairValueInputsLevel2Memberus-gaap:USTreasuryAndGovernmentMember2021-12-310001726173us-gaap:FairValueInputsLevel3Memberus-gaap:USTreasuryAndGovernmentMember2021-12-310001726173us-gaap:USTreasuryAndGovernmentMember2021-12-310001726173us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Member2022-03-310001726173us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Member2022-03-310001726173us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Member2022-03-310001726173us-gaap:CorporateDebtSecuritiesMember2022-03-310001726173us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Member2021-12-310001726173us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Member2021-12-310001726173us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Member2021-12-310001726173us-gaap:CorporateDebtSecuritiesMember2021-12-310001726173bh:BiglariEntitiesMember2022-01-012022-03-310001726173bh:BiglariEntitiesMemberbh:ServicesAgreementMember2021-01-012021-03-310001726173bh:BiglariEntitiesMemberbh:ServicesAgreementMember2022-01-012022-03-310001726173bh:BiglariEntitiesMember2022-03-310001726173bh:RestaurantOperationsMemberbh:SteakNShakeMember2022-01-012022-03-310001726173bh:RestaurantOperationsMemberbh:SteakNShakeMember2021-01-012021-03-310001726173bh:WesternSizzlinMemberbh:RestaurantOperationsMember2022-01-012022-03-310001726173bh:WesternSizzlinMemberbh:RestaurantOperationsMember2021-01-012021-03-310001726173bh:InsuranceUnderwritingMemberbh:FirstGuardMemberbh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:InsuranceUnderwritingMemberbh:FirstGuardMemberbh:InsuranceOperationsMember2021-01-012021-03-310001726173bh:SouthernPioneerMemberbh:InsuranceUnderwritingMemberbh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:SouthernPioneerMemberbh:InsuranceUnderwritingMemberbh:InsuranceOperationsMember2021-01-012021-03-310001726173bh:InsuranceInvestmentIncomeAndOtherMemberbh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:InsuranceInvestmentIncomeAndOtherMemberbh:InsuranceOperationsMember2021-01-012021-03-310001726173bh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:InsuranceOperationsMember2021-01-012021-03-310001726173bh:SouthernOilMember2022-01-012022-03-310001726173bh:SouthernOilMember2021-01-012021-03-310001726173bh:MaximMember2022-01-012022-03-310001726173bh:MaximMember2021-01-012021-03-310001726173bh:RestaurantOperationsMemberbh:SteakNShakeMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001726173bh:RestaurantOperationsMemberbh:SteakNShakeMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001726173bh:WesternSizzlinMemberbh:RestaurantOperationsMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001726173bh:WesternSizzlinMemberbh:RestaurantOperationsMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001726173bh:RestaurantOperationsMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001726173bh:RestaurantOperationsMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001726173bh:InsuranceUnderwritingMemberbh:FirstGuardMemberus-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:InsuranceUnderwritingMemberbh:FirstGuardMemberus-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2021-01-012021-03-310001726173bh:SouthernPioneerMemberbh:InsuranceUnderwritingMemberus-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:SouthernPioneerMemberbh:InsuranceUnderwritingMemberus-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2021-01-012021-03-310001726173bh:InsuranceInvestmentIncomeAndOtherMemberus-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2022-01-012022-03-310001726173bh:InsuranceInvestmentIncomeAndOtherMemberus-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2021-01-012021-03-310001726173us-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2022-01-012022-03-310001726173us-gaap:OperatingSegmentsMemberbh:InsuranceOperationsMember2021-01-012021-03-310001726173bh:SouthernOilMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001726173bh:SouthernOilMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001726173bh:MaximMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001726173bh:MaximMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001726173us-gaap:OperatingSegmentsMember2022-01-012022-03-310001726173us-gaap:OperatingSegmentsMember2021-01-012021-03-310001726173us-gaap:MaterialReconcilingItemsMember2022-01-012022-03-310001726173us-gaap:MaterialReconcilingItemsMember2021-01-012021-03-31
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___ to ___
Commission file number 001-38477
BIGLARI HOLDINGS INC.
(Exact name of registrant as specified in its charter)

Indiana82-3784946
(State or other jurisdiction of incorporation)(I.R.S. Employer Identification No.)

17802 IH 10 West,
Suite 400
San Antonio,TX78257
(Address of principal executive offices)(Zip Code)
(210) 344-3400
Registrant’s telephone number, including area code
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolsName of each exchange on which registered
Class A Common Stock, no par value BH.ANew York Stock Exchange
Class B Common Stock, no par valueBHNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x    No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x    No ¨


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and an “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
  Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No x
Number of shares of common stock outstanding as of May 3, 2022:
Class A common stock –  206,864 
Class B common stock –2,068,640 


BIGLARI HOLDINGS INC.
INDEX
Page No.



PART 1 – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BIGLARI HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
March 31,
2022
December 31,
2021
(Unaudited)
Assets
Current assets:
Cash and cash equivalents$45,777 $42,349 
Investments87,150 83,061 
Receivables22,427 28,508 
Inventories4,376 3,803 
Other current assets8,067 7,088 
Total current assets167,797 164,809 
Property and equipment347,609 349,351 
Operating lease assets40,540 42,538 
Goodwill and other intangible assets76,854 77,010 
Investment partnerships242,368 250,399 
Other assets10,686 10,700 
Total assets$885,854 $894,807 
Liabilities and shareholders’ equity
Liabilities
Current liabilities:
Accounts payable and accrued expenses$99,761 $100,467 
Loss and loss adjustment expenses14,443 14,609 
Unearned premiums11,875 11,667 
Current portion of lease obligations17,057 16,898 
Total current liabilities143,136 143,641 
Lease obligations101,156 104,479 
Deferred taxes41,763 46,533 
Asset retirement obligations10,520 10,389 
Other liabilities1,982 2,069 
Total liabilities298,557 307,111 
Shareholders’ equity
Common stock1,138 1,138 
Additional paid-in capital381,788 381,788 
Retained earnings608,230 608,528 
Accumulated other comprehensive loss(2,138)(1,907)
Treasury stock, at cost(401,721)(401,851)
Biglari Holdings Inc. shareholders’ equity587,297 587,696 
Total liabilities and shareholders’ equity$885,854 $894,807 
See accompanying Notes to Consolidated Financial Statements.
1

BIGLARI HOLDINGS INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(dollars in thousands except per share amounts)
First Quarter
20222021
(Unaudited)
Revenues  
Restaurant operations$59,847 $69,954 
Insurance premiums and other15,079 14,619 
Oil and gas9,812 8,592 
Licensing and media634 1,123 
85,372 94,288 
Cost and expenses
Restaurant cost of sales35,352 45,616 
Insurance losses and underwriting expenses13,774 11,146 
Oil and gas production costs3,819 2,413 
Licensing and media costs953 480 
Selling, general and administrative16,224 15,540 
Impairments 298 
Depreciation, depletion, and amortization7,871 7,178 
Interest expense1,412 2,741 
79,405 85,412 
Other income
Investment gains225 3,081 
Investment partnership gains (losses)(6,661)81,766 
Total other income (expenses)(6,436)84,847 
Earnings (loss) before income taxes(469)93,723 
Income tax expense (benefit)(171)22,016 
Net earnings (loss)$(298)$71,707 
Net earnings (loss) per equivalent Class A share *$(0.98)$223.29 
*Net earnings (loss) per equivalent Class B share outstanding are one-fifth of the equivalent Class A share or $(0.20) for the first quarter of 2022 and $44.66 for the first quarter of 2021.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(dollars in thousands)
 First Quarter
 20222021
 (Unaudited)
Net earnings (loss)$(298)$71,707 
Foreign currency translation(231)(444)
Total comprehensive income (loss)$(529)$71,263 
See accompanying Notes to Consolidated Financial Statements.

2

BIGLARI HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
First Quarter
20222021
(Unaudited)
Operating activities  
Net earnings (loss)$(298)$71,707 
Adjustments to reconcile net earnings (loss) to operating cash flows:
Depreciation, depletion, and amortization7,871 7,178 
Provision for deferred income taxes(4,750)23,350 
Asset impairments and other non-cash expenses 435 
Gains on disposal of assets(133)(958)
Investment and investment partnership (gains) losses6,436 (85,013)
Distributions from investment partnerships4,500 150,570 
Changes in receivables, inventories and other assets4,633 1,924 
Changes in accounts payable and accrued expenses2,833 (3,895)
Net cash provided by operating activities21,092 165,298 
Investing activities
Capital expenditures(9,293)(7,447)
Proceeds from property and equipment disposals109 2,749 
Purchases of limited partner interests(3,000)(3,000)
Purchases of investments(50,086)(16,724)
Sales of investments and redemptions of fixed maturity securities46,193 15,642 
Net cash used in investing activities(16,077)(8,780)
Financing activities
Principal payments on long-term debt (149,952)
Principal payments on direct financing lease obligations(1,564)(2,609)
Net cash used in financing activities(1,564)(152,561)
Effect of exchange rate changes on cash(23)(22)
Increase in cash, cash equivalents and restricted cash3,428 3,935 
Cash, cash equivalents and restricted cash at beginning of year43,687 29,666 
Cash, cash equivalents and restricted cash at end of first quarter$47,115 $33,601 
First Quarter
20222021
(Unaudited)
Cash and cash equivalents$45,777 $28,438 
Restricted cash in other long-term assets1,338 5,163 
Cash, cash equivalents and restricted cash at end of first quarter$47,115 $33,601 
See accompanying Notes to Consolidated Financial Statements.
3

BIGLARI HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited)
(dollars in thousands)
Common
Stock
Additional Paid-In
Capital
Retained
Earnings
Accumulated
Other
Comprehensive 
Income (Loss)
Treasury
Stock
Total
Balance at December 31, 2021$1,138 $381,788 $608,528 $(1,907)$(401,851)$587,696 
Net earnings (loss)(298)(298)
Other comprehensive loss(231)(231)
Adjustment to treasury stock for holdings in investment partnerships130 130 
Balance at March 31, 2022$1,138 $381,788 $608,230 $(2,138)$(401,721)$587,297 
Common
Stock
Additional 
Paid-In
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Treasury
Stock  
Total
Balance at December 31, 2020$1,138 $381,788 $573,050 $(1,531)$(389,617)$564,828 
Net earnings (loss)71,707 71,707 
Other comprehensive loss(444)(444)
Adjustment to treasury stock for holdings in investment partnerships3,049 3,049 
Balance at March 31, 2021$1,138 $381,788 $644,757 $(1,975)$(386,568)$639,140 
See accompanying Notes to Consolidated Financial Statements.
4

BIGLARI HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2022
(dollars in thousands, except share and per share data)
Note 1. Summary of Significant Accounting Policies
Description of Business
The accompanying unaudited consolidated financial statements of Biglari Holdings Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) applicable to interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In our opinion, all adjustments considered necessary to present fairly the results of the interim periods have been included and consist only of normal recurring adjustments. The results for the interim periods shown are not necessarily indicative of results for the entire fiscal year. The financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in our annual report on Form 10-K for the year ended December 31, 2021.
Biglari Holdings is a holding company owning subsidiaries engaged in a number of diverse business activities, including property and casualty insurance, licensing and media, restaurants, and oil and gas. The Company’s largest operating subsidiaries are involved in the franchising and operating of restaurants. Biglari Holdings is founded and led by Sardar Biglari, Chairman and Chief Executive Officer of the Company.

Biglari Holdings’ management system combines decentralized operations with centralized finance decision-making. Operating decisions for the various business units are made by their respective managers. All major investment and capital allocation decisions are made for the Company and its subsidiaries by Mr. Biglari.
As of March 31, 2022, Mr. Biglari beneficially owns shares of the Company that represent approximately 66.3% of the economic interest and approximately 70.4% of the voting interest.

Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, including Steak n Shake Inc., Western Sizzlin Corporation, First Guard Insurance Company, Maxim Inc., Southern Pioneer Property & Casualty Insurance Company, and Southern Oil Company. Intercompany accounts and transactions have been eliminated in consolidation.
Note 2. Earnings Per Share
Earnings per share of common stock is based on the weighted average number of shares outstanding during the year. The shares of Company stock attributable to our limited partner interest in The Lion Fund, L.P. and The Lion Fund II, L.P. (collectively, the “investment partnerships”) — based on our proportional ownership during this period — are considered treasury stock on the consolidated balance sheet and thereby deemed not to be included in the calculation of weighted average common shares outstanding. However, these shares are legally outstanding.
The following table presents shares authorized, issued and outstanding on March 31, 2022 and December 31, 2021.
 March 31, 2022December 31, 2021
 Class AClass BClass AClass B
Common stock authorized500,000 10,000,000 500,000 10,000,000 
Common stock issued and outstanding206,864 2,068,640 206,864 2,068,640 

5

Note 2. Earnings Per Share (continued)
The Company has applied the “two-class method” of computing earnings per share as prescribed in Accounting Standards Codification (“ASC”) 260, “Earnings Per Share”. The equivalent Class A common stock applied for computing earnings per share excludes the proportional shares of Biglari Holdings’ stock held by the investment partnerships. In the tabulation below is the equivalent Class A common stock for earnings per share. There are no dilutive securities outstanding.
March 31, 2022March 31, 2021
Equivalent Class A common stock outstanding620,592 620,592 
Proportional ownership of Company stock held by investment partnerships316,020 299,453 
Equivalent Class A common stock for earnings per share304,572 321,139 
Note 3. Investments
Investments net of deferred taxes is presented below.
March 31, 2022December 31, 2021
Investments$87,150 $83,061 
Deferred tax liability related to investments(607)(845)
Investments net of deferred taxes$86,543 $82,216 
We classify investments in fixed maturity securities at the acquisition date as either available-for-sale or held-to-maturity and re-evaluate the classification at each balance sheet date. Securities classified as held-to-maturity are carried at amortized cost, reflecting the ability and intent to hold the securities to maturity. Realized gains and losses on disposals of investments are determined on a specific identification basis. Dividends earned on investments are reported as investment income by our insurance companies. We consider investment income as a component of our aggregate insurance operating result. However, we consider investment gains and losses, whether realized or unrealized, as non-operating.

Investment gains for the first quarter of 2022 and 2021 were $225 and $3,081, respectively.
Note 4. Investment Partnerships   
The Company reports on the limited partnership interests in investment partnerships under the equity method of accounting. We record our proportional share of equity in the investment partnerships but exclude Company common stock held by said partnerships. The Company’s pro-rata share of its common stock held by the investment partnerships is recorded as treasury stock even though these shares are legally outstanding. The Company records gains/losses from investment partnerships (inclusive of the investment partnerships’ unrealized gains and losses on their securities) in the consolidated statements of earnings based on our carrying value of these partnerships. The fair value is calculated net of the general partner’s accrued incentive fees. Gains and losses on Company common stock included in the earnings of these partnerships are eliminated because they are recorded as treasury stock. 
Biglari Capital Corp. is the general partner of the investment partnerships and is an entity solely owned by Mr. Biglari.
The fair value and adjustment for Company common stock held by the investment partnerships to determine the carrying value of our partnership interest are presented below.
 Fair ValueCompany
Common Stock
Carrying Value
Partnership interest at December 31, 2021$474,201 $223,802 $250,399 
Investment partnership gains (losses)(909)5,752 (6,661)
Distributions (net of contributions)(1,500)(1,500)
Changes in proportionate share of Company stock held(130)130 
Partnership interest at March 31, 2022$471,792 $229,424 $242,368 
6

Note 4. Investment Partnerships (continued)

 Fair ValueCompany
Common Stock
Carrying Value
Partnership interest at December 31, 2020$590,926 $171,376 $419,550 
Investment partnership gains (losses)110,918 29,152 81,766 
Distributions (net of contributions)(147,570)(147,570)
Changes in proportionate share of Company stock held(3,049)3,049 
Partnership interest at March 31, 2021$554,274 $197,479 $356,795 
The carrying value of the investment partnerships net of deferred taxes is presented below.
 March 31,
2022
December 31, 2021
Carrying value of investment partnerships$242,368 $250,399 
Deferred tax liability related to investment partnerships(39,516)(44,532)
Carrying value of investment partnerships net of deferred taxes$202,852 $205,867 
The Company’s proportionate share of Company stock held by investment partnerships at cost was $401,721 and $401,851 at March 31, 2022 and December 31, 2021, respectively, and was recorded as treasury stock. 
The carrying value of the partnership interest approximates fair value adjusted by the value of held Company stock.  Fair value of our partnership interest is assessed according to our proportional ownership interest of the fair value of investments held by the investment partnerships. Unrealized gains and losses on marketable securities held by the investment partnerships affect our net earnings. 
Gains/losses from investment partnerships recorded in the Company’s consolidated statements of earnings are presented below.
 First Quarter
 20222021
Gains (losses) from investment partnerships$(6,661)$81,766 
Tax expense (benefit)(1,860)19,117 
Contribution to net earnings$(4,801)$62,649 
On December 31 of each year, the general partner of the investment partnerships, Biglari Capital Corp., will earn an incentive reallocation fee for the Company’s investments equal to 25% of the net profits above an annual hurdle rate of 6% over the previous high-water mark. Our policy is to accrue an estimated incentive fee throughout the year. The total incentive reallocation from Biglari Holdings to Biglari Capital Corp. includes gains on the Company’s common stock. Gains and losses on the Company’s common stock and the related incentive reallocations are eliminated in our financial statements.
There were no incentive reallocations from Biglari Holdings to Biglari Capital Corp. during the first quarters of 2022 and 2021.

7

Note 4. Investment Partnerships (continued)

Summarized financial information for The Lion Fund, L.P. and The Lion Fund II, L.P. is presented below.
 Equity in Investment Partnerships
 Lion FundLion Fund II
Total assets as of March 31, 2022$123,634 $533,454 
Total liabilities as of March 31, 2022$20,162 $101,230 
Revenue for the first quarter of 2022$969 $(1,249)
Earnings for the first quarter of 2022$926 $(1,581)
Biglari Holdings’ ownership interest as of March 31, 202262.5 %93.9 %
Total assets as of December 31, 2021$114,749 $564,022 
Total liabilities as of December 31, 2021$7,763 $130,417 
Revenue for the first quarter of 2021$18,016 $105,347 
Earnings for the first quarter of 2021$17,998 $105,274 
Biglari Holdings’ ownership interest as of March 31, 202161.3 %94.0 %
Revenue in the financial information of the investment partnerships, summarized above, includes investment income and unrealized gains and losses on investments.
Note 5. Property and Equipment
Property and equipment is composed of the following.
 March 31,
2022
December 31,
2021
Land$144,605 $144,605 
Buildings149,162 148,605 
Land and leasehold improvements147,355 147,349 
Equipment225,955 224,581 
Oil and gas properties74,150 74,147 
Construction in progress4,180 2,815 
 745,407 742,102 
Less accumulated depreciation, depletion, and amortization(397,798)(392,751)
Property and equipment, net$347,609 $349,351 
Depletion expense related to oil and gas properties was $1,380 and $2,244 during the first quarter of 2022 and 2021, respectively.
The Company recorded an impairment to restaurant long-lived assets of $298 in the first quarter of 2021 related to underperforming stores. The fair value of the long-lived assets was determined based on Level 3 inputs using a discounted cash flow model and quoted prices for the properties. There were no impairments in 2022.
Note 6. Goodwill and Other Intangible Assets
Goodwill
Goodwill consists of the excess of the purchase price over the fair value of the net assets acquired in connection with business acquisitions.
8

Note 6. Goodwill and Other Intangible Assets (continued)
A reconciliation of the change in the carrying value of goodwill is as follows.
 Goodwill
Goodwill at December 31, 2021
$53,547 
Change in foreign exchange rates during the first quarter of 2022(12)
Goodwill at March 31, 2022
$53,535 

We evaluate goodwill and any indefinite-lived intangible assets for impairment annually, or more frequently if circumstances indicate impairment may have occurred. Goodwill impairment occurs when the estimated fair value of goodwill is less than its carrying value. GAAP allows entities testing for impairment the option of performing a qualitative assessment before calculating the fair value of a reporting unit for the goodwill impairment test. We use both qualitative and quantitative assessments. The valuation methodology and underlying financial information included in our quantitative determination of fair value require significant management judgments. We use both market and income approaches to derive fair value of reporting units utilizing a quantitative assessment. The judgments in these two approaches include, but are not limited to, comparable market multiples, long-term projections of future financial performance, and the selection of appropriate discount rates used to determine the present value of future cash flows. Changes in such estimates or the application of alternative assumptions could produce significantly different results. No impairment was recorded in the first quarter of 2022 or 2021. Western Sizzlin has experienced a decline in its franchised units for several years. If Western Sizzlin’s franchised units continue to decline, an impairment of its goodwill may be necessary.
Other Intangible Assets
Intangible assets with indefinite lives are composed of the following.
 Trade NamesLease RightsTotal
Balance at December 31, 2021
$15,876 $7,587 $23,463 
Change in foreign exchange rates during the first quarter of 2022 (144)(144)
Balance at March 31, 2022
$15,876 $7,443 $23,319 
Intangible assets with indefinite lives consist of trade names and lease rights. Fair values were determined using Level 3 inputs and available market data. 
Note 7. Restaurant Operations Revenues
Restaurant operations revenues were as follows.
 First Quarter
 20222021
Net sales$38,216 $54,950 
Franchise partner fees15,624 7,853 
Franchise royalties and fees5,146 5,135 
Other861 2,016 
 $59,847 $69,954 
Net Sales
Net sales are composed of retail sales of food through company-operated stores. Company-operated store revenues are recognized, net of discounts and sales taxes, when our obligation to perform is satisfied at the point of sale. Sales taxes related to these sales are collected from customers and remitted to the appropriate taxing authority and are not reflected in the Company’s consolidated statements of earnings as revenue.

Franchise Partner Fees
Franchise partner fees are composed of up to 15% of sales as well as 50% of profits. We are therefore fully affected by the operating results of the business, unlike in a traditional franchising arrangement, where the franchisor obtains a royalty fee based on sales only. We generate most of our revenue from our share of the franchise partners’ profits. An initial franchise fee of ten thousand dollars is recognized when the operator becomes a franchise partner. The Company recognizes franchise partner fees monthly as underlying restaurant sales occur.
9

Note 7. Restaurant Operations Revenues (continued)
The Company leases or subleases property and equipment to franchise partners under lease arrangements. Both real estate and equipment rental payments are charged to franchise partners and are recognized in accordance with ASC 842, “Leases”. During the first quarter of 2022 and 2021, restaurant operations recognized $4,774 and $2,900, respectively, in franchise partner fees related to rental income.
Franchise Royalties and Fees
Franchise royalties and fees from Steak n Shake and Western Sizzlin franchisees are based upon a percentage of sales of the franchise restaurant and are recognized as earned. Franchise royalties are billed on a monthly basis. Initial franchise fees when a new restaurant opens or at the start of a new franchise term are recorded as deferred revenue when received and recognized as revenue over the term of the franchise agreement.
Other Revenue
Restaurant operations sells gift cards to customers which can be redeemed for retail food sales within our stores. Gift cards are recorded as a liability when issued and are subsequently recorded as net sales upon redemption. Restaurant operations estimates breakage related to gift cards when the likelihood of redemption is remote. This estimate utilizes historical trends based on the vintage of the gift card. Breakage on gift cards is recorded as other revenue in proportion to the rate of gift card redemptions by vintage.
Note 8. Accounts Payable and Accrued Expenses
Accounts payable and accrued expenses include the following.
 March 31,
2022
December 31,
2021
Accounts payable$34,946 $36,684 
Gift card and other marketing17,548 19,244 
Insurance accruals5,108 6,428 
Salaries, wages and vacation6,570 5,905 
Deferred revenue8,194 6,683 
Taxes payable16,038 11,392 
Professional fees7,969 11,731 
Other3,388 2,400 
Accounts payable and accrued expenses$99,761 $100,467 

Note 9. Notes Payable
Steak n Shake Credit Facility
On March 19, 2014, Steak n Shake and its subsidiaries entered into a credit agreement which provided for a senior secured term loan facility in an aggregate principal amount of $220,000. The term loan was scheduled to mature on March 19, 2021. The Company repaid the balance of Steak n Shake’s term facility on February 19, 2021.
10


Note 10. Lease Assets and Obligations
Lease obligations include the following.
Current portion of lease obligationsMarch 31,
2022
December 31,
2021
Finance lease liabilities$1,318 $1,414 
Finance obligations5,029 4,944 
Operating lease liabilities10,710 10,540 
Total current portion of lease obligations$17,057 $16,898 
Long-term lease obligations
Finance lease liabilities$5,021 $5,347 
Finance obligations62,327 63,119 
Operating lease liabilities33,808 36,013 
Total long-term lease obligations$101,156 $104,479 
Nature of Leases
Steak n Shake and Western Sizzlin operate restaurants that are located on sites owned by us and leased from third parties. In addition, they own sites and lease sites from third parties that are leased and/or subleased to franchise partners and franchisees.
Lease Costs
A significant portion of our operating and finance lease portfolio includes restaurant locations. We recognize fixed lease expense for operating leases on a straight-line basis over the lease term. For finance leases, we recognize amortization expense on the right-of-use asset and interest expense on the lease liability over the lease term.
Total lease cost consists of the following.
First Quarter
20222021
Finance lease costs:
Amortization of right-of-use assets$363 $419 
Interest on lease liabilities115 147 
Operating and variable lease costs3,612 3,765 
Sublease income(4,069)(2,655)
Total lease costs$21 $1,676 
Supplemental cash flow information related to leases is as follows.
 First Quarter
 20222021
Cash paid for amounts included in the measurement of lease liabilities:  
Financing cash flows from finance leases$421 $529 
Operating cash flows from finance leases$115 $132 
Operating cash flows from operating leases$3,067 $4,186 


11

Note 10. Lease Assets and Obligations (continued)
Supplemental balance sheet information related to leases is as follows.
March 31,
2022
December 31,
2021
Finance leases:
Property and equipment, net$5,271 $5,634 
Weighted-average lease terms and discount rates are as follows.
March 31,
2022
Weighted-average remaining lease terms:
Finance leases4.91 years
Operating leases4.99 years
Weighted-average discount rates:
Finance leases7.0 %
Operating leases6.9 %
Maturities of lease liabilities as of March 31, 2022 are as follows.
YearOperating
Leases
Finance
Leases
2022$10,298 $1,298 
202311,259 1,551 
20249,433 1,534 
20257,854 1,298 
20265,203 959 
After 20268,730 855 
Total lease payments52,777 7,495 
Less interest8,259 1,156 
Total lease liabilities$44,518 $6,339 
Lease Income
The components of lease income are as follows.
First Quarter
20222021
Operating lease income$4,724 $2,363 
Variable lease income313 849 
Total lease income$5,037 $3,212 

12

Note 10. Lease Assets and Obligations (continued)
The following table displays the Company’s future minimum rental receipts for non-cancelable leases and subleases as of March 31, 2022. Franchise partner leases and subleases are short-term leases and have been excluded from the table.

Operating Leases
YearSubleasesOwned Properties
2022$582 $247 
2023371 247 
2024338 247 
2025273 255 
2026 233 
After 2026 753 
Total future minimum receipts$1,564 $1,982 
Note 11. Accumulated Other Comprehensive Income
Accumulated other comprehensive income decreased $231 and $444 during the first quarters of 2022 and 2021, respectively. There were no reclassifications from accumulated other comprehensive loss to earnings during the first quarters of 2022 and 2021.  All changes in accumulated other comprehensive loss were due to foreign currency translation adjustments.
Note 12. Income Taxes
In determining the quarterly provision for income taxes, the Company used an estimated annual effective tax rate for the first quarter of 2022 and a discrete effective tax rate method based on statutory tax rates for the first quarter of 2021. Our periodic effective income tax rate is affected by the relative mix of pretax earnings or losses and underlying income tax rates applicable to the various taxing jurisdictions.
Income tax benefit for the first quarter of 2022 was $171 compared to an income tax expense of $22,016 for the first quarter of 2021.  The variance in income taxes between 2022 and 2021 is attributable to taxes on income generated by the investment partnerships.  Investment partnership pretax losses were $6,661 during the first quarter of 2022 compared to pretax gains of $81,766 during the first quarter of 2021. 
Note 13. Commitments and Contingencies

We are involved in various legal proceedings and have certain unresolved claims pending. We believe, based on examination of these matters and experiences to date, that the ultimate liability, if any, in excess of amounts already provided in our consolidated financial statements is not likely to have a material effect on our results of operations, financial position or cash flow.
Note 14. Fair Value of Financial Assets
The fair values of substantially all of our financial instruments were measured using market or income approaches. Considerable judgment may be required in interpreting market data used to develop the estimates of fair value. Accordingly, the fair values presented are not necessarily indicative of the amounts that could be realized in an actual current market exchange. The use of alternative market assumptions and/or estimation methodologies may have a material effect on the estimated fair value.

13

Note 14. Fair Value of Financial Assets (continued)
The hierarchy for measuring fair value consists of Levels 1 through 3, which are described below.
Level 1 – Inputs represent unadjusted quoted prices for identical assets or liabilities exchanged in active markets. 
Level 2 – Inputs include directly or indirectly observable inputs (other than Level 1 inputs) such as quoted prices for similar assets or liabilities exchanged in active or inactive markets; quoted prices for identical assets or liabilities exchanged in inactive markets; other inputs that may be considered in fair value determinations of the assets or liabilities, such as interest rates and yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates; and inputs that are derived principally from or corroborated by observable market data by correlation or other means. Pricing evaluations generally reflect discounted expected future cash flows, which incorporate yield curves for instruments with similar characteristics, such as credit ratings, estimated durations and yields for other instruments of the issuer or entities in the same industry sector.
Level 3 – Inputs include unobservable inputs used in the measurement of assets and liabilities. Management is required to use its own assumptions regarding unobservable inputs because there is little, if any, market activity in the assets or liabilities and we may be unable to corroborate the related observable inputs. Unobservable inputs require management to make certain projections and assumptions about the information that would be used by market participants in pricing assets or liabilities.
The following methods and assumptions were used to determine the fair value of each class of the following assets recorded at fair value in the consolidated balance sheets:
Cash equivalents: Cash equivalents primarily consist of money market funds which are classified as Level 1 of the fair value hierarchy.
Equity securities: The Company’s investments in equity securities are classified as Levels 1 and 2 of the fair value hierarchy. 
Bonds: The Company’s investments in bonds consist of both corporate and government debt. Bonds are classified as Level l or Level 2 of the fair value hierarchy.
Non-qualified deferred compensation plan investments: The assets of the non-qualified plan are set up in a rabbi trust. They represent mutual funds and publicly traded securities, each of which are classified as Level 1 of the fair value hierarchy.
Derivative instruments: Options related to equity securities are marked to market each reporting period and are classified as Level 2 of the fair value hierarchy depending on the instrument.
14

Note 14. Fair Value of Financial Assets (continued)
As of March 31, 2022 and December 31, 2021, the fair values of financial assets were as follows.
March 31, 2022December 31, 2021
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash equivalents$17,790 $ $ $17,790 $18,447 $ $ $18,447 
Equity securities
Consumer goods9,836 2,003  11,839 10,775 2,368  13,143 
Insurance134   134 6,513   6,513 
Technology2,878   2,878 2,887   2,887 
Bonds
Government66,413   66,413 54,584   54,584 
Corporate4,100   4,100 4,512   4,512 
Options on equity securities 2,461  2,461  2,095  2,095 
Non-qualified deferred compensation plan investments1,528   1,528 1,607   1,607 
Total assets at fair value$102,679 $4,464 $ $107,143 $99,325 $4,463 $ $103,788 
There were no changes in our valuation techniques used to measure fair values on a recurring basis.
Note 15. Related Party Transactions
Service Agreement
The Company is party to a service agreement with Biglari Enterprises LLC and Biglari Capital Corp. (collectively, the “Biglari Entities”) under which the Biglari Entities provide business and administrative related services to the Company. The Biglari Entities are owned by Mr. Biglari. The service agreement has a five-year term, effective on October 1, 2017.  

The Company paid Biglari Enterprises $2,100 in service fees during the first quarter of 2022 and 2021. The service agreement does not alter the hurdle rate connected with the incentive reallocation paid to Biglari Capital Corp.  
Incentive Agreement
The Incentive Agreement establishes a performance-based annual incentive payment for Mr. Biglari contingent upon the growth in adjusted equity in each year attributable to our operating businesses. In order for Mr. Biglari to receive any incentive, our operating businesses must achieve an annual increase in shareholders’ equity in excess of 6% (the “Hurdle Rate”) above the previous highest level (the “High Water Mark”). Mr. Biglari will receive 25% of any incremental book value created above the High Water Mark plus the Hurdle Rate. In any year in which book value declines, our operating businesses must completely recover their deficit from the previous High Water Mark, along with attaining the Hurdle Rate, before Mr. Biglari becomes eligible to receive any further incentive payment.
Note 16. Business Segment Reporting
Our reportable business segments are organized in a manner that reflects how management views those business activities. Our restaurant operations include Steak n Shake and Western Sizzlin. Our insurance operations include First Guard and Southern Pioneer.  The Company also reports segment information for Maxim and Southern Oil. Other business activities not specifically identified with reportable business segments are presented in corporate. We report our earnings from investment partnerships separate from our corporate expenses. We assess and measure segment operating results based on segment earnings as disclosed below. Segment earnings from operations are neither necessarily indicative of cash available to fund cash requirements, nor synonymous with cash flow from operations. The tabular information that follows shows data of our reportable segments reconciled to amounts reflected in the consolidated financial statements.
15

Note 16. Business Segment Reporting (continued)


A disaggregation of our consolidated data for the first quarters of 2022 and 2021 is presented in the tables which follow.
Revenue
First Quarter
20222021
Operating Businesses:
Restaurant Operations:
Steak n Shake$57,753 $68,301 
Western Sizzlin2,094 1,653 
Total Restaurant Operations59,847 69,954 
Insurance Operations:
Underwriting
First Guard8,731 8,077 
Southern Pioneer5,438 5,613 
Investment income and other910 929 
Total Insurance Operations15,079 14,619 
Southern Oil9,812 8,592 
Maxim634 1,123 
$85,372 $94,288 


16

Note 16. Business Segment Reporting (continued)


 Earnings (Losses) Before Income Taxes
 First Quarter
 20222021
Operating Businesses:
Restaurant Operations:
Steak n Shake$4,198 $5,456 
Western Sizzlin232 92 
Total Restaurant Operations4,430 5,548 
Insurance Operations:
Underwriting:
First Guard732 2,131 
Southern Pioneer(337)413 
Investment income and other969 693 
Total Insurance Operations1,364 3,237 
Southern Oil3,921 3,039 
Maxim(336)623 
Interest expense not allocated to segments (1,121)
Total Operating Businesses9,379 11,326 
Corporate and other(3,412)(2,450)
Investment gains225 3,081 
Investment partnership gains (losses)(6,661)81,766 
 $(469)$93,723 
17


Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations 
(dollars in thousands except per share data)
Overview
Biglari Holdings Inc. is a holding company owning subsidiaries engaged in a number of diverse business activities, including property and casualty insurance, licensing and media, restaurants, and oil and gas. The Company’s largest operating subsidiaries are involved in the franchising and operating of restaurants. Biglari Holdings is founded and led by Sardar Biglari, Chairman and Chief Executive Officer of the Company.

Biglari Holdings’ management system combines decentralized operations with centralized finance decision-making. Operating decisions for the various business units are made by their respective managers. All major investment and capital allocation decisions are made for the Company and its subsidiaries by Mr. Biglari.
As of March 31, 2022, Mr. Biglari beneficially owns shares of the Company that represent approximately 66.3% of the economic interest and 70.4% of the voting interest.
Net earnings (loss) attributable to Biglari Holdings shareholders are disaggregated in the table that follows. Amounts are recorded after deducting income taxes. 
 First Quarter
 20222021
Operating businesses:  
Restaurant$3,262 $4,118 
Insurance1,044 2,531 
Oil and gas2,924 2,355 
Brand licensing(251)480 
Interest expense— (841)
Corporate and other(2,651)(1,999)
Total operating businesses4,328 6,644 
Investment gains175 2,414 
Investment partnership gains (losses)(4,801)62,649 
 $(298)$71,707 
Restaurants
Our restaurant businesses, which include Steak n Shake and Western Sizzlin, comprise 575 company-operated and franchise restaurants as of March 31, 2022.
Steak n ShakeWestern Sizzlin
 Company-
operated
Franchise
Partner
Traditional
Franchise
Company-
operated
FranchiseTotal
Total stores as of December 31, 2021
199 159 178 38 577 
Corporate stores transitioned(12)12 — — — — 
Net restaurants opened (closed)(3)— — — (2)
Total stores as of March 31, 2022
184 171 179 38 575 
Total stores as of December 31, 2020
276 86 194 39 598 
Corporate stores transitioned(22)22 — — — — 
Net restaurants opened (closed)(1)— (5)— (1)(7)
Total stores as of March 31, 2021
253 108