QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(Exact name of registrant as specified in its charter) |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbols | Name of each exchange on which registered | ||||||
| ||||||||
Large accelerated filer | ☐ | ☒ | |||||||||
Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
Emerging growth company |
Class A common stock – | |||||
Class B common stock – |
Page No. | ||||||||
March 31, 2023 | December 31, 2022 | ||||||||||
(Unaudited) | |||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Investments | |||||||||||
Receivables | |||||||||||
Inventories | |||||||||||
Other current assets | |||||||||||
Total current assets | |||||||||||
Property and equipment | |||||||||||
Operating lease assets | |||||||||||
Goodwill and other intangible assets | |||||||||||
Investment partnerships | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities and shareholders’ equity | |||||||||||
Liabilities | |||||||||||
Current liabilities: | |||||||||||
Accounts payable and accrued expenses | $ | $ | |||||||||
Unpaid losses and loss adjustment expenses | |||||||||||
Unearned premiums | |||||||||||
Current portion of lease obligations | |||||||||||
Line of credit | |||||||||||
Total current liabilities | |||||||||||
Lease obligations | |||||||||||
Deferred taxes | |||||||||||
Asset retirement obligations | |||||||||||
Other liabilities | |||||||||||
Total liabilities | |||||||||||
Shareholders’ equity | |||||||||||
Common stock | |||||||||||
Additional paid-in capital | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Treasury stock, at cost | ( | ( | |||||||||
Biglari Holdings Inc. shareholders’ equity | |||||||||||
Noncontrolling interests | |||||||||||
Total shareholders’ equity | |||||||||||
Total liabilities and shareholders’ equity | $ | $ |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
(Unaudited) | |||||||||||
Revenues | |||||||||||
Restaurant operations | $ | $ | |||||||||
Insurance premiums and other | |||||||||||
Oil and gas | |||||||||||
Licensing and media | |||||||||||
Total revenues | |||||||||||
Costs and expenses | |||||||||||
Restaurant cost of sales | |||||||||||
Insurance losses and underwriting expenses | |||||||||||
Oil and gas production costs | |||||||||||
Licensing and media costs | |||||||||||
Selling, general and administrative | |||||||||||
Impairments | |||||||||||
Depreciation, depletion, and amortization | |||||||||||
Interest expense on leases | |||||||||||
Interest expense on borrowings | |||||||||||
Total costs and expenses | |||||||||||
Other income | |||||||||||
Investment gains | |||||||||||
Investment partnership gains (losses) | ( | ||||||||||
Total other income (expenses) | ( | ||||||||||
Earnings (loss) before income taxes | ( | ||||||||||
Income tax expense (benefit) | ( | ||||||||||
Net earnings (loss) | ( | ||||||||||
Earnings attributable to noncontrolling interest | |||||||||||
Net earnings (loss) attributable to Biglari Holdings Inc. shareholders | $ | $ | ( | ||||||||
Net earnings (loss) per average equivalent Class A share* | $ | $ | ( |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
(Unaudited) | |||||||||||
Net earnings (loss) | $ | $ | ( | ||||||||
Foreign currency translation | ( | ||||||||||
Comprehensive income (loss) | ( | ||||||||||
Comprehensive income attributable to noncontrolling interest | |||||||||||
Total comprehensive income (loss) attributable to Biglari Holdings Inc. shareholders | $ | $ | ( |
Biglari Holdings Inc. Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Non-controlling Interests | Total | |||||||||||||||||||||||||||||||||||
For the first quarter of 2023 | |||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
Net earnings (loss) | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | |||||||||||||||||||||||||||||||||||||||||
Adjustment for holdings in investment partnerships | ( | ( | |||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2023 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
For the first quarter of 2022 | |||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
Net earnings (loss) | ( | ( | |||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | ( | ( | |||||||||||||||||||||||||||||||||||||||
Adjustment for holdings in investment partnerships | |||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
(Unaudited) | |||||||||||
Operating activities | |||||||||||
Net earnings (loss) | $ | $ | ( | ||||||||
Adjustments to reconcile net earnings (loss) to operating cash flows: | |||||||||||
Depreciation, depletion, and amortization | |||||||||||
Provision for deferred income taxes | ( | ||||||||||
Asset impairments | |||||||||||
Gains on sale of assets | ( | ( | |||||||||
Investment and investment partnerships (gains) losses | ( | ||||||||||
Distributions from investment partnerships | |||||||||||
Changes in receivables, inventories and other assets | |||||||||||
Changes in accounts payable and accrued expenses | |||||||||||
Net cash provided by operating activities | |||||||||||
Investing activities | |||||||||||
Capital expenditures | ( | ( | |||||||||
Proceeds from property and equipment disposals | |||||||||||
Purchases of interests in limited partnerships | ( | ( | |||||||||
Purchases of investments | ( | ( | |||||||||
Sales of investments and redemptions of fixed maturity securities | |||||||||||
Net cash used in investing activities | ( | ( | |||||||||
Financing activities | |||||||||||
Repayments of borrowings | ( | ||||||||||
Principal payments on direct financing lease obligations | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effects of foreign currency exchange rate changes | ( | ||||||||||
Increase in cash, cash equivalents and restricted cash | |||||||||||
Cash, cash equivalents and restricted cash at beginning of year | |||||||||||
Cash, cash equivalents and restricted cash at end of first quarter | $ | $ |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
(Unaudited) | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Restricted cash in other long-term assets | |||||||||||
Cash, cash equivalents and restricted cash at end of first quarter | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Class A | Class B | Class A | Class B | ||||||||||||||||||||
Common stock authorized | |||||||||||||||||||||||
Common stock issued and outstanding |
March 31, 2023 | March 31, 2022 | ||||||||||
Equivalent Class A common stock outstanding | |||||||||||
Proportional ownership of Company stock held by investment partnerships | |||||||||||
Equivalent Class A common stock for earnings per share |
Fair Value | Company Common Stock | Carrying Value | |||||||||||||||
Partnership interest at December 31, 2022 | $ | $ | $ | ||||||||||||||
Investment partnership gains (losses) | |||||||||||||||||
Contributions | |||||||||||||||||
Changes in proportionate share of Company stock held | ( | ||||||||||||||||
Partnership interest at March 31, 2023 | $ | $ | $ |
Fair Value | Company Common Stock | Carrying Value | |||||||||||||||
Partnership interest at December 31, 2021 | $ | $ | $ | ||||||||||||||
Investment partnership gains (losses) | ( | ( | |||||||||||||||
Distributions (net of contributions) | ( | ( | |||||||||||||||
Changes in proportionate share of Company stock held | ( | ||||||||||||||||
Partnership interest at March 31, 2022 | $ | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Carrying value of investment partnerships | $ | $ | |||||||||
Deferred tax liability related to investment partnerships | ( | ( | |||||||||
Carrying value of investment partnerships net of deferred taxes | $ | $ |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Gains (losses) from investment partnerships | $ | $ | ( | ||||||||
Tax expense (benefit) | ( | ||||||||||
Contribution to net earnings | $ | $ | ( |
Equity in Investment Partnerships | |||||||||||
Lion Fund | Lion Fund II | ||||||||||
Total assets as of March 31, 2023 | $ | $ | |||||||||
Total liabilities as of March 31, 2023 | $ | $ | |||||||||
Revenue for the first quarter of 2023 | $ | $ | |||||||||
Earnings for the first quarter of 2023 | $ | $ | |||||||||
Biglari Holdings’ ownership interest as of March 31, 2023 | % | % | |||||||||
Total assets as of December 31, 2022 | $ | $ | |||||||||
Total liabilities as of December 31, 2022 | $ | $ | |||||||||
Revenue for the first quarter of 2022 | $ | $ | ( | ||||||||
Earnings for the first quarter of 2022 | $ | $ | ( | ||||||||
Biglari Holdings’ ownership interest as of March 31, 2022 | % | % |
March 31, 2023 | December 31, 2022 | ||||||||||
Land | $ | $ | |||||||||
Buildings | |||||||||||
Land and leasehold improvements | |||||||||||
Equipment | |||||||||||
Oil and gas properties | |||||||||||
Construction in progress | |||||||||||
Less accumulated depreciation, depletion, and amortization | ( | ( | |||||||||
Property and equipment, net | $ | $ |
Goodwill | |||||
Goodwill at December 31, 2022 | |||||
Goodwill | $ | ||||
Accumulated impairment losses | ( | ||||
$ | |||||
Change in foreign exchange rates during the first quarter of 2023 | |||||
Goodwill at March 31, 2023 | $ |
Trade Names | Lease Rights | Total | |||||||||||||||
Balance at December 31, 2022 | |||||||||||||||||
Intangibles | $ | $ | $ | ||||||||||||||
Accumulated impairment losses | ( | ( | |||||||||||||||
$ | $ | $ | |||||||||||||||
Change in foreign exchange rates during the first quarter of 2023 | |||||||||||||||||
Balance at March 31, 2023 | $ | $ | $ |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Net sales | $ | $ | |||||||||
Franchise partner fees | |||||||||||
Franchise royalties and fees | |||||||||||
Other | |||||||||||
$ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Accounts payable | $ | $ | |||||||||
Gift card and other marketing | |||||||||||
Insurance accruals | |||||||||||
Salaries and wages | |||||||||||
Deferred revenue | |||||||||||
Taxes payable | |||||||||||
Oil and gas payable | |||||||||||
Other | |||||||||||
Accounts payable and accrued expenses | $ | $ |
2023 | 2022 | ||||||||||
Balances at beginning of year: | |||||||||||
Gross liabilities | $ | $ | |||||||||
Reinsurance recoverable on unpaid losses | ( | ( | |||||||||
Net liabilities | |||||||||||
Incurred losses and loss adjustment expenses: | |||||||||||
Current accident year | |||||||||||
Prior accident years | ( | ( | |||||||||
Total | |||||||||||
Paid losses and loss adjustment expenses: | |||||||||||
Current accident year | |||||||||||
Prior accident years | |||||||||||
Total | |||||||||||
Balances at March 31: | |||||||||||
Net liabilities | |||||||||||
Reinsurance recoverable on unpaid losses | |||||||||||
Gross liabilities | $ | $ |
Current portion of lease obligations | March 31, 2023 | December 31, 2022 | |||||||||
$ | $ | ||||||||||
Finance obligations | |||||||||||
Total current portion of lease obligations | $ | $ | |||||||||
Long-term lease obligations | |||||||||||
$ | $ | ||||||||||
Finance obligations | |||||||||||
Total long-term lease obligations | $ | $ |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Finance lease costs: | |||||||||||
Amortization of right-of-use assets | $ | $ | |||||||||
Interest on lease liabilities | |||||||||||
Operating and variable lease costs | |||||||||||
Sublease income | ( | ( | |||||||||
Total lease costs | $ | $ |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
Financing cash flows from finance leases | $ | $ | |||||||||
Operating cash flows from finance leases | $ | $ | |||||||||
Operating cash flows from operating leases | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Finance leases: | |||||||||||
Property and equipment, net | $ | $ |
March 31, 2023 | |||||
Weighted-average remaining lease terms: | |||||
Finance leases | |||||
Operating leases | |||||
Weighted-average discount rates: | |||||
Finance leases | % | ||||
Operating leases | % |
Year | Operating Leases | Finance Leases | ||||||||||||
Remainder of 2023 | $ | $ | ||||||||||||
2024 | ||||||||||||||
2025 | ||||||||||||||
2026 | ||||||||||||||
2027 | ||||||||||||||
After 2027 | ||||||||||||||
Total lease payments | ||||||||||||||
Less interest | ||||||||||||||
Total lease liabilities | $ | $ |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Operating lease income | $ | $ | |||||||||
Variable lease income | |||||||||||
Total lease income | $ | $ |
Operating Leases | ||||||||||||||
Year | Subleases | Owned Properties | ||||||||||||
Remainder of 2023 | $ | $ | ||||||||||||
2024 | ||||||||||||||
2025 | ||||||||||||||
2026 | ||||||||||||||
2027 | ||||||||||||||
After 2027 | ||||||||||||||
Total future minimum receipts | $ | $ | ||||||||||||
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||||||||
Cash equivalents | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||||||||||||||||||||
Consumer goods | |||||||||||||||||||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||||||||||||||
Bonds | |||||||||||||||||||||||||||||||||||||||||||||||
Government | |||||||||||||||||||||||||||||||||||||||||||||||
Corporate | |||||||||||||||||||||||||||||||||||||||||||||||
Non-qualified deferred compensation plan investments | |||||||||||||||||||||||||||||||||||||||||||||||
Total assets at fair value | $ | $ | $ | $ | $ | $ | $ | $ |
Revenues | |||||||||||
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Operating Businesses: | |||||||||||
Restaurant Operations: | |||||||||||
Steak n Shake | $ | $ | |||||||||
Western Sizzlin | |||||||||||
Total Restaurant Operations | |||||||||||
Insurance Operations: | |||||||||||
Underwriting: | |||||||||||
First Guard | |||||||||||
Southern Pioneer | |||||||||||
Investment income and other | |||||||||||
Total Insurance Operations | |||||||||||
Oil and Gas Operations: | |||||||||||
Abraxas Petroleum | |||||||||||
Southern Oil | |||||||||||
Total Oil and Gas Operations | |||||||||||
Maxim | |||||||||||
$ | $ |
Earnings (Losses) Before Income Taxes | |||||||||||
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Operating Businesses: | |||||||||||
Restaurant Operations: | |||||||||||
Steak n Shake | $ | $ | |||||||||
Western Sizzlin | |||||||||||
Total Restaurant Operations | |||||||||||
Insurance Operations: | |||||||||||
Underwriting: | |||||||||||
First Guard | |||||||||||
Southern Pioneer | ( | ( | |||||||||
Investment income and other | |||||||||||
Total Insurance Operations | |||||||||||
Oil and Gas Operations: | |||||||||||
Abraxas Petroleum | |||||||||||
Southern Oil | |||||||||||
Total Oil and Gas Operations | |||||||||||
Maxim | ( | ||||||||||
Interest expense not allocated to segments | ( | ||||||||||
Total Operating Businesses | |||||||||||
Corporate and other | ( | ( | |||||||||
Investment gains | |||||||||||
Investment partnership gains (losses) | ( | ||||||||||
$ | $ | ( |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Operating businesses: | |||||||||||
Restaurant | $ | 5,840 | $ | 3,262 | |||||||
Insurance | 2,169 | 1,044 | |||||||||
Oil and gas | 1,670 | 2,924 | |||||||||
Brand licensing | 91 | (251) | |||||||||
Interest expense | (129) | — | |||||||||
Corporate and other | (2,998) | (2,651) | |||||||||
Total operating businesses | 6,643 | 4,328 | |||||||||
Investment partnership gains (losses) | 56,029 | (4,801) | |||||||||
Investment gains | 2,865 | 175 | |||||||||
Net earnings (loss) | 65,537 | (298) | |||||||||
Earnings attributable to noncontrolling interest | 651 | — | |||||||||
Net earnings (loss) attributable to Biglari Holdings Inc. shareholders | $ | 64,886 | $ | (298) |
Steak n Shake | Western Sizzlin | ||||||||||||||||||||||||||||||||||
Company- operated | Franchise Partner | Traditional Franchise | Company- operated | Franchise | Total | ||||||||||||||||||||||||||||||
Total stores as of December 31, 2022 | 177 | 175 | 154 | 3 | 36 | 545 | |||||||||||||||||||||||||||||
Corporate stores transitioned | (3) | 3 | — | — | — | — | |||||||||||||||||||||||||||||
Net restaurants opened (closed) | (2) | — | (11) | — | — | (13) | |||||||||||||||||||||||||||||
Total stores as of March 31, 2023 | 172 | 178 | 143 | 3 | 36 | 532 | |||||||||||||||||||||||||||||
Total stores as of December 31, 2021 | 199 | 159 | 178 | 3 | 38 | 577 | |||||||||||||||||||||||||||||
Corporate stores transitioned | (12) | 12 | — | — | — | — | |||||||||||||||||||||||||||||
Net restaurants opened (closed) | (3) | — | 1 | — | — | (2) | |||||||||||||||||||||||||||||
Total stores as of March 31, 2022 | 184 | 171 | 179 | 3 | 38 | 575 |
First Quarter | |||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
Revenue | |||||||||||||||||||||||
Net sales | $ | 36,894 | $ | 38,216 | |||||||||||||||||||
Franchise partner fees | 17,912 | 15,624 | |||||||||||||||||||||
Franchise royalties and fees | 4,258 | 5,146 | |||||||||||||||||||||
Other revenue | 2,065 | 861 | |||||||||||||||||||||
Total revenue | 61,129 | 59,847 | |||||||||||||||||||||
Restaurant cost of sales | |||||||||||||||||||||||
Cost of food | 10,448 | 28.3 | % | 10,960 | 28.7 | % | |||||||||||||||||
Restaurant operating costs | 18,457 | 50.0 | % | 20,032 | 52.4 | % | |||||||||||||||||
Occupancy costs | 3,833 | 10.4 | % | 4,360 | 11.4 | % | |||||||||||||||||
Total cost of sales | 32,738 | 35,352 | |||||||||||||||||||||
Selling, general and administrative | |||||||||||||||||||||||
General and administrative | 10,463 | 17.1 | % | 8,650 | 14.5 | % | |||||||||||||||||
Marketing | 2,953 | 4.8 | % | 3,744 | 6.3 | % | |||||||||||||||||
Other expenses (income) | (1,612) | (2.6) | % | 45 | 0.1 | % | |||||||||||||||||
Total selling, general and administrative | 11,804 | 19.3 | % | 12,439 | 20.8 | % | |||||||||||||||||
Impairments | (776) | — | |||||||||||||||||||||
Depreciation and amortization | (6,707) | (6,214) | |||||||||||||||||||||
Interest on finance leases and obligations | (1,307) | (1,412) | |||||||||||||||||||||
Earnings (loss) before income taxes | 7,797 | 4,430 | |||||||||||||||||||||
Income tax expense (benefit) | 1,957 | 1,168 | |||||||||||||||||||||
Contribution to net earnings | $ | 5,840 | $ | 3,262 |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Underwriting gain attributable to: | |||||||||||
First Guard | $ | 1,862 | $ | 732 | |||||||
Southern Pioneer | (111) | (337) | |||||||||
Pre-tax underwriting gain | 1,751 | 395 | |||||||||
Income tax expense | 368 | 83 | |||||||||
Net underwriting gain | $ | 1,383 | $ | 312 |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Premiums earned | $ | 14,764 | $ | 14,169 | |||||||
Insurance losses | 8,596 | 9,588 | |||||||||
Underwriting expenses | 4,417 | 4,186 | |||||||||
Pre-tax underwriting gain | 1,751 | 395 | |||||||||
Other income and expenses | |||||||||||
Investment income | 585 | 213 | |||||||||
Other income (expenses) | 451 | 756 | |||||||||
Total other income | 1,036 | 969 | |||||||||
Earnings before income taxes | 2,787 | 1,364 | |||||||||
Income tax expense | 618 | 320 | |||||||||
Contribution to net earnings | $ | 2,169 | $ | 1,044 |
First Quarter | |||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
Amount | % | Amount | % | ||||||||||||||||||||
Premiums earned | $ | 8,899 | 100.0 | % | $ | 8,731 | 100.0 | % | |||||||||||||||
Insurance losses | 5,244 | 58.9 | % | 6,188 | 70.9 | % | |||||||||||||||||
Underwriting expenses | 1,793 | 20.1 | % | 1,811 | 20.7 | % | |||||||||||||||||
Total losses and expenses | 7,037 | 79.0 | % | 7,999 | 91.6 | % | |||||||||||||||||
Pretax underwriting gain | $ | 1,862 | $ | 732 |
First Quarter | |||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
Amount | % | Amount | % | ||||||||||||||||||||
Premiums earned | $ | 5,865 | 100.0 | % | $ | 5,438 | 100.0 | % | |||||||||||||||
Insurance losses | 3,352 | 57.2 | % | 3,400 | 62.5 | % | |||||||||||||||||
Underwriting expenses | 2,624 | 44.7 | % | 2,375 | 43.7 | % | |||||||||||||||||
Total losses and expenses | 5,976 | 101.9 | % | 5,775 | 106.2 | % | |||||||||||||||||
Pretax underwriting gain (loss) | $ | (111) | $ | (337) |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Interest, dividends and other investment income: | |||||||||||
First Guard | $ | 387 | $ | 74 | |||||||
Southern Pioneer | 198 | 139 | |||||||||
Pre-tax investment income | 585 | 213 | |||||||||
Income tax expense | 123 | 45 | |||||||||
Net investment income | $ | 462 | $ | 168 |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Oil and gas revenues | $ | 12,223 | $ | 9,812 | |||||||
Oil and gas production costs | 5,471 | 3,819 | |||||||||
Depreciation, depletion and accretion | 2,850 | 1,519 | |||||||||
General and administrative expenses | 1,799 | 553 | |||||||||
Earnings before income taxes | 2,103 | 3,921 | |||||||||
Income tax expense | 433 | 997 | |||||||||
Contribution to net earnings | $ | 1,670 | $ | 2,924 |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Oil and gas revenues | $ | 4,971 | $ | 9,812 | |||||||
Oil and gas production costs | 2,340 | 3,819 | |||||||||
Depreciation, depletion and accretion | 1,184 | 1,519 | |||||||||
General and administrative expenses | 553 | 553 | |||||||||
Earnings before income taxes | 894 | 3,921 | |||||||||
Income tax expense | 155 | 997 | |||||||||
Contribution to net earnings | $ | 739 | $ | 2,924 |
First Quarter | |||||
2023 | |||||
Oil and gas revenues | $ | 7,252 | |||
Oil and gas production costs | 3,131 | ||||
Depreciation, depletion and accretion | 1,666 | ||||
General and administrative expenses | 1,246 | ||||
Earnings before income taxes | 1,209 | ||||
Income tax expense | 278 | ||||
Contribution to net earnings | $ | 931 |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Licensing and media revenues | $ | 595 | $ | 634 | |||||||
Licensing and media costs | 452 | 953 | |||||||||
General and administrative expenses | 21 | 17 | |||||||||
Earnings before income taxes | 122 | (336) | |||||||||
Income tax expense (benefit) | 31 | (85) | |||||||||
Contribution to net earnings | $ | 91 | $ | (251) |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Investment partnership gains (losses) | $ | 72,588 | $ | (6,661) | |||||||
Tax expense (benefit) | 16,559 | (1,860) | |||||||||
Contribution to net earnings | $ | 56,029 | $ | (4,801) |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Interest expense on line of credit | $ | 167 | $ | — | |||||||
Tax benefit | 38 | — | |||||||||
Interest expense net of tax | $ | 129 | $ | — |
March 31, 2023 | December 31, 2022 | ||||||||||
Cash and cash equivalents | $ | 39,363 | $ | 37,467 | |||||||
Investments | 79,652 | 69,466 | |||||||||
Fair value of interest in investment partnerships | 507,499 | 383,004 | |||||||||
Total cash and investments | 626,514 | 489,937 | |||||||||
Less: portion of Company stock held by investment partnerships | (276,656) | (227,210) | |||||||||
Carrying value of cash and investments on balance sheet | $ | 349,858 | $ | 262,727 |
First Quarter | |||||||||||
2023 | 2022 | ||||||||||
Net cash provided by operating activities | $ | 19,923 | $ | 21,092 | |||||||
Net cash used in investing activities | (12,735) | (16,077) | |||||||||
Net cash used in financing activities | (5,050) | (1,564) | |||||||||
Effect of exchange rate changes on cash | 8 | (23) | |||||||||
Increase in cash, cash equivalents and restricted cash | $ | 2,146 | $ | 3,428 |
Exhibit Number | Description | |||||||
101 | Interactive Data Files. | |||||||
104 | Cover page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101) |
* | Furnished herewith. |
Biglari Holdings Inc. | |||||||||||
Date: May 5, 2023 | By: | /s/ BRUCE LEWIS | |||||||||
Bruce Lewis | |||||||||||
Controller |
Date: May 5, 2023 | /s/ Sardar Biglari | ||||||||||
Sardar Biglari | |||||||||||
Chairman and Chief Executive Officer |
Date: May 5, 2023 | By: | /s/ Bruce Lewis | ||||||||||||
Bruce Lewis | ||||||||||||||
Controller |
/s/ Sardar Biglari | |||||
Sardar Biglari | |||||
Chairman and Chief Executive Officer | |||||
Date: May 5, 2023 |
/s/ Bruce Lewis | |||||
Bruce Lewis | |||||
Controller | |||||
Date: May 5, 2023 |
CONSOLIDATED STATEMENTS OF EARNINGS (Parenthetical) - Common Class B |
3 Months Ended | |
---|---|---|
Mar. 31, 2023
$ / shares
|
Mar. 31, 2022
$ / shares
|
|
Net earnings (loss) per average equivalent Class B share, basic (in dollars per share) | $ 44.46 | $ (0.20) |
Net earnings (loss) per average equivalent Class B share, diluted (in dollars per share) | $ 44.46 | $ (0.20) |
Net earnings (loss) per equivalent share ratio | 0.2 | 0.2 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||
Net earnings (loss) | $ 65,537 | $ (298) |
Foreign currency translation | 332 | (231) |
Comprehensive income (loss) | 65,869 | (529) |
Comprehensive income attributable to noncontrolling interest | 651 | 0 |
Total comprehensive income (loss) attributable to Biglari Holdings Inc. shareholders | $ 65,218 | $ (529) |
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Operating activities | ||
Net earnings (loss) | $ 65,537 | $ (298) |
Adjustments to reconcile net earnings (loss) to operating cash flows: | ||
Depreciation, depletion, and amortization | 9,940 | 7,871 |
Provision for deferred income taxes | 18,450 | (4,750) |
Asset impairments | 776 | 0 |
Gains on sale of assets | (1,590) | (133) |
Investment and investment partnerships (gains) losses | (76,226) | 6,436 |
Distributions from investment partnerships | 0 | 4,500 |
Changes in receivables, inventories and other assets | 2,006 | 4,633 |
Changes in accounts payable and accrued expenses | 1,030 | 2,833 |
Net cash provided by operating activities | 19,923 | 21,092 |
Investing activities | ||
Capital expenditures | (5,929) | (9,293) |
Proceeds from property and equipment disposals | 2,140 | 109 |
Purchases of interests in limited partnerships | (2,700) | (3,000) |
Purchases of investments | (27,255) | (50,086) |
Sales of investments and redemptions of fixed maturity securities | 21,009 | 46,193 |
Net cash used in investing activities | (12,735) | (16,077) |
Financing activities | ||
Repayments of borrowings | (3,500) | 0 |
Principal payments on direct financing lease obligations | (1,550) | (1,564) |
Net cash used in financing activities | (5,050) | (1,564) |
Effects of foreign currency exchange rate changes | 8 | (23) |
Increase in cash, cash equivalents and restricted cash | 2,146 | 3,428 |
Cash, cash equivalents and restricted cash at beginning of year | 38,805 | 43,687 |
Cash, cash equivalents and restricted cash at end of first quarter | 40,951 | 47,115 |
Cash and cash equivalents | 39,363 | 45,777 |
Restricted cash in other long-term assets | 1,588 | 1,338 |
Cash, cash equivalents and restricted cash at end of first quarter | $ 40,951 | $ 47,115 |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY - USD ($) $ in Thousands |
Total |
Common Stock |
Additional Paid-In Capital |
Retained Earnings |
Accumulated Other Comprehensive Income (Loss) |
Treasury Stock |
Non-controlling Interests |
---|---|---|---|---|---|---|---|
Beginning balance at Dec. 31, 2021 | $ 587,696 | $ 1,138 | $ 381,788 | $ 608,528 | $ (1,907) | $ (401,851) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | (298) | (298) | |||||
Other comprehensive income (loss) | (231) | (231) | |||||
Adjustment for holdings in investment partnerships | 130 | 130 | |||||
Ending balance at Mar. 31, 2022 | 587,297 | 1,138 | 381,788 | 608,230 | (2,138) | (401,721) | 0 |
Beginning balance at Dec. 31, 2022 | 555,568 | 1,138 | 381,788 | 576,510 | (2,790) | (409,680) | 8,602 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | 65,537 | 64,886 | 651 | ||||
Other comprehensive income (loss) | 332 | 332 | |||||
Adjustment for holdings in investment partnerships | (239) | (239) | |||||
Ending balance at Mar. 31, 2023 | $ 621,198 | $ 1,138 | $ 381,788 | $ 641,396 | $ (2,458) | $ (409,919) | $ 9,253 |
Summary of Significant Accounting Policies |
3 Months Ended |
---|---|
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 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 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, 2022. 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 financial 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, 2023, 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. Business Acquisition On September 14, 2022, the Company purchased Series A Preferred Stock (the “Preferred Shares”) of Abraxas Petroleum Corporation for a purchase price of $80 million. On October 26, 2022, the Company exchanged the Preferred Shares for 90% of the outstanding common stock of Abraxas Petroleum. 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, Southern Oil Company, and Abraxas Petroleum Corporation. Intercompany accounts and transactions have been eliminated in consolidation.
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Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | 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, 2023 and December 31, 2022.
The Company has applied the “two-class method” of computing earnings per share as prescribed in Accounting Standards Codification (“ASC”) 260, “Earnings Per Share”. (Class B shares are economically equivalent to one-fifth of a Class A 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 weighted-average equivalent Class A common stock for earnings per share.
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Investments |
3 Months Ended |
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Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments We classify investments in fixed maturity securities at the acquisition date as available-for-sale. 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 2023 and 2022 were $3,638 and $225, respectively.
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Investment Partnerships |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment Partnerships | 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. Biglari Capital Corp. is 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.
The carrying value of the investment partnerships net of deferred taxes is presented below.
Because of a transaction that occurred between The Lion Fund, L.P., and The Lion Fund II, L.P., in 2022, we expect that a majority of the $40,410 deferred tax liability enumerated above will not become due until the dissolution of the investment partnerships. In effect, the tax-basis cost increased for the common stock of certain unaffiliated securities held by the investment partnerships. The Company’s proportionate share of Company stock held by investment partnerships at cost was $409,919 and $409,680 as of March 31, 2023 and December 31, 2022, respectively. 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.
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 accrued during the first quarters of 2023 and 2022. Summarized financial information for The Lion Fund, L.P., and The Lion Fund II, L.P., is presented below.
Revenue in the financial information of the investment partnerships, summarized above, includes investment income and unrealized gains and losses on investments.
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Property and Equipment |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment | Property and Equipment Property and equipment is composed of the following.
Depletion expense related to oil and gas properties was $2,648 and $1,380 during the first quarter of 2023 and 2022, respectively. The Company recorded an impairment to restaurant long-lived assets of $776 in the first quarter of 2023 related to underperforming stores. There were no impairments in the first quarter of 2022. Property and equipment held for sale of $8,012 and $4,700 are recorded in other current assets as of March 31, 2023 and December 31, 2022, respectively. The assets classified as held for sale include seven properties owned by Steak n Shake, which were previously operated restaurants, and Abraxas Petroleum’s office building. During the first quarter of 2023, Steak n Shake sold the property of a former company-operated restaurant for a gain of $1,431.
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Goodwill and Other Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets | 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. A reconciliation of the change in the carrying value of goodwill is as follows.
Goodwill and indefinite-lived intangible asset impairment reviews include determining the estimated fair values of our reporting units and indefinite-lived intangible assets. The key assumptions and inputs used in such determinations may include forecasting revenues and expenses, cash flows and capital expenditures, as well as an appropriate discount rate and other inputs. Significant judgment by management is required in estimating the fair value of a reporting unit and in performing impairment reviews. Due to the inherent subjectivity and uncertainty in forecasting future cash flows and earnings over long periods of time, actual results may differ materially from the forecasts. If the carrying value of the indefinite-lived intangible asset exceeds fair value, the excess is charged to earnings as an impairment loss. If the carrying value of a reporting unit exceeds the estimated fair value of the reporting unit, then the excess, limited to the carrying amount of goodwill, will be charged to earnings as an impairment loss. There was no impairment recorded for goodwill during the first quarters of 2023 or 2022. Other Intangible Assets Intangible assets with indefinite lives are composed of the following.
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Restaurant Operations Revenues |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restaurant Operations Revenues | Restaurant Operations Revenues Restaurant operations revenues were as follows.
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. 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 2023 and 2022, restaurant operations recognized $5,575 and $4,774, 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 deferred revenue 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.
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Accounts Payable and Accrued Expenses |
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Payable and Accrued Expenses | Accounts Payable and Accrued Expenses Accounts payable and accrued expenses include the following.
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Line of Credit and Note Payable |
3 Months Ended |
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Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Line of Credit and Note Payable | Line of Credit and Note Payable Biglari Holdings Line of Credit On September 13, 2022, Biglari Holdings entered into a line of credit in an aggregate principal amount of up to $30,000. The line of credit will be available on a revolving basis until September 12, 2024. The line of credit includes customary covenants, as well as financial maintenance covenants. The balance of the line of credit was $6,500 and $10,000 on March 31, 2023 and December 31, 2022, respectively. Our interest rate was 7.3% on March 31, 2023. The line of credit was paid in full in April 2023. Western Sizzlin Revolver Western Sizzlin’s available line of credit is $500. As of March 31, 2023 and December 31, 2022, Western Sizzlin had no debt outstanding under its revolver.
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Unpaid losses and loss adjustment expense |
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Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and loss adjustment expense | Unpaid losses and loss adjustment expenses Our liabilities for unpaid losses and loss adjustment expenses (also referred to as “claim liabilities”) under insurance contracts are based upon estimates of the ultimate claim costs associated with claim occurrences as of the balance sheet date and include estimates for incurred-but-not-reported (“IBNR”) claims. A reconciliation of the changes in claim liabilities, net of reinsurance, for each of the three-month periods ending March 31, 2023 and 2022 follows.
Incurred loss and loss adjustment expenses of $8,596 and $9,588 in the first quarter of 2023 and 2022, respectively, were recorded in earnings and related to insured events occurring in the current period and events occurring in all prior periods. Incurred and paid loss and loss adjustment expenses are net of reinsurance recoveries. We recorded net reductions of estimated ultimate liabilities for prior accident years of $1,651 and $133 in the first quarter of 2023 and 2022, respectively, which produced corresponding reductions in incurred losses and loss adjustment expenses in those periods. These reductions as a percentage of the net liabilities at the beginning of each year, were 9.8% in 2023 and 1.0% in 2022.
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Lease Assets and Obligations |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease Assets and Obligations | Lease Assets and Obligations Lease obligations include the following.
Nature of Leases Steak n Shake and Western Sizzlin operate restaurants that are located on sites owned by us or leased from third parties. In addition, they own sites and lease sites from third parties that are leased and/or subleased to 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.
Supplemental cash flow information related to leases is as follows.
Supplemental balance sheet information related to leases is as follows.
Weighted-average lease terms and discount rates are as follows.
Maturities of lease liabilities as of March 31, 2023 are as follows.
Lease Income The components of lease income are as follows.
The following table displays the Company’s future minimum rental receipts for non-cancelable leases and subleases as of March 31, 2023. Franchise partner leases and subleases are short-term leases and have been excluded from the table.
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Lease Assets and Obligations | Lease Assets and Obligations Lease obligations include the following.
Nature of Leases Steak n Shake and Western Sizzlin operate restaurants that are located on sites owned by us or leased from third parties. In addition, they own sites and lease sites from third parties that are leased and/or subleased to 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.
Supplemental cash flow information related to leases is as follows.
Supplemental balance sheet information related to leases is as follows.
Weighted-average lease terms and discount rates are as follows.
Maturities of lease liabilities as of March 31, 2023 are as follows.
Lease Income The components of lease income are as follows.
The following table displays the Company’s future minimum rental receipts for non-cancelable leases and subleases as of March 31, 2023. Franchise partner leases and subleases are short-term leases and have been excluded from the table.
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Income Taxes |
3 Months Ended |
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Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesIn determining the quarterly provision for income taxes, the Company used an estimated annual effective tax rate for the first quarter of 2023 and 2022. Our periodic effective income tax rate is affected by the relative mix of pre-tax earnings or losses and underlying income tax rates applicable to the various taxing jurisdictions.Income tax expense for the first quarter of 2023 was $19,738 compared to an income tax benefit of $171 for the first quarter of 2022. The variance in income taxes between 2023 and 2022 is primarily attributable to taxes on income generated by the investment partnerships. Investment partnership pre-tax gains were $72,588 during the first quarter of 2023 compared to pre-tax losses of $6,661 during the first quarter of 2022. |
Commitments and Contingencies |
3 Months Ended |
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Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and ContingenciesWe 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. |
Fair Value of Financial Assets |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Assets | 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. 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 Level 1 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 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. As of March 31, 2023 and December 31, 2022, the fair values of financial assets were as follows.
There were no changes in our valuation techniques used to measure fair values on a recurring basis.
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Related Party Transactions |
3 Months Ended |
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Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Service Agreement The Company is party to a service agreement with Biglari Enterprises LLC (“Biglari Enterprises”) under which Biglari Enterprises provides business and administrative related services to the Company. Biglari Enterprises is owned by Mr. Biglari. The Company paid Biglari Enterprises $2,100 in service fees during the first quarters of 2023 and 2022. 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.
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Business Segment Reporting |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segment Reporting | Business Segment ReportingOur 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. Our oil and gas operations include Southern Oil and Abraxas Petroleum. The Company also reports segment information for Maxim. 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. A disaggregation of our consolidated data for the first quarters of 2023 and 2022 is presented in the tables which follow.
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Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | 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, Southern Oil Company, and Abraxas Petroleum Corporation. Intercompany accounts and transactions have been eliminated in consolidation.
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Earnings Per Share (Tables) |
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Common Stock Outstanding Roll Forward | The following table presents shares authorized, issued and outstanding on March 31, 2023 and December 31, 2022.
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Schedule of Weighted Average Number of Shares | In the tabulation below is the weighted-average equivalent Class A common stock for earnings per share.
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Investment Partnerships (Tables) |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value and carrying value of our partnership interest | 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.
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Carrying value of investment partnerships net of deferred taxes | The carrying value of the investment partnerships net of deferred taxes is presented below.
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Schedule of Gains (Losses) from Investment Partnerships | Gains/losses from investment partnerships recorded in the Company’s consolidated statements of earnings are presented below.
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Schedule of Summarized Financial Information | Summarized financial information for The Lion Fund, L.P., and The Lion Fund II, L.P., is presented below.
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Property and Equipment (Tables) |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment | Property and equipment is composed of the following.
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Goodwill and Other Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill | A reconciliation of the change in the carrying value of goodwill is as follows.
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Schedule of Finite-Lived Intangible Assets | Intangible assets with indefinite lives are composed of the following.
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Restaurant Operations Revenues (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of restaurant operations revenues | Restaurant operations revenues were as follows.
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Accounts Payable And Accrued Expenses (Tables) |
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accrued Liabilities | Accounts payable and accrued expenses include the following.
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Unpaid losses and loss adjustment expense (Tables) |
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Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Liability for Unpaid Claims and Claims Adjustment Expense | A reconciliation of the changes in claim liabilities, net of reinsurance, for each of the three-month periods ending March 31, 2023 and 2022 follows.
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Lease Assets and Obligations (Tables) |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | Lease obligations include the following.
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Schedule of Lease Cost | Total lease cost consists of the following.
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Schedule of Cash Flow, Supplemental Disclosures | Supplemental cash flow information related to leases is as follows.
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Schedule of supplemental balance sheet information related to leases | Supplemental balance sheet information related to leases is as follows.
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Schedule of weighted-average lease terms and discount rates | Weighted-average lease terms and discount rates are as follows.
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Schedule of Lease Maturities | Maturities of lease liabilities as of March 31, 2023 are as follows.
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Operating Lease, Lease Income | The components of lease income are as follows.
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Lessor, Operating Lease, Payment to be Received, Fiscal Year Maturity | The following table displays the Company’s future minimum rental receipts for non-cancelable leases and subleases as of March 31, 2023. Franchise partner leases and subleases are short-term leases and have been excluded from the table.
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Fair Value of Financial Assets (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | As of March 31, 2023 and December 31, 2022, the fair values of financial assets were as follows.
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Business Segment Reporting (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | A disaggregation of our consolidated data for the first quarters of 2023 and 2022 is presented in the tables which follow.
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Schedule of earnings (losses) before income taxes by segment |
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Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Millions |
Sep. 14, 2022 |
Mar. 31, 2023 |
Oct. 26, 2022 |
---|---|---|---|
Abraxas Petroleum Corporation | |||
Business Acquisition [Line Items] | |||
Purchase price | $ 80 | ||
Consolidated Entities | Abraxas Petroleum Corporation | Common Stock | |||
Business Acquisition [Line Items] | |||
Preferred stock converted, percentage of outstanding common stock | 90.00% | ||
Mr. Biglari | |||
Business Acquisition [Line Items] | |||
Economic interest | 66.30% | ||
Voting interest | 70.40% |
Earnings Per Share - Schedule of Common Stock (Details) - shares |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Common Class A | ||
Common stock authorized (in shares) | 500,000 | 500,000 |
Common stock issued (in shares) | 206,864 | 206,864 |
Common stock outstanding (in shares) | 206,864 | 206,864 |
Common Class B | ||
Common stock authorized (in shares) | 10,000,000 | 10,000,000 |
Common stock issued (in shares) | 2,068,640 | 2,068,640 |
Common stock outstanding (in shares) | 2,068,640 | 2,068,640 |
Earnings Per Share - Narrative (Details) |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Common Class B | ||
Net earnings (loss) per equivalent share ratio | 0.2 | 0.2 |
Earnings Per Share - Schedule of Class A Common Stock (Details) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Earnings Per Share [Abstract] | ||
Equivalent class A common stock outstanding (in shares) | 620,592 | 620,592 |
Proportional ownership of Company stock held by investment partnerships (in shares) | 328,681 | 316,020 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 291,911 | 304,572 |
Investments - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Investments, Debt and Equity Securities [Abstract] | ||
Investment gains | $ 3,638 | $ 225 |
Investment Partnerships - Fair Value and Adjustments (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Fair Value | ||
Increase (Decrease) In Equity Method Investments [Roll Forward] | ||
Fair value of partnership interest, beginning balance | $ 383,004 | $ 474,201 |
Investment partnership gains (losses) | 121,795 | (909) |
Contributions | 2,700 | |
Contributions | (1,500) | |
Changes in proportionate share of Company stock held | ||
Fair value of partnership interest, ending balance | 507,499 | 471,792 |
Company Common Stock | ||
Increase (Decrease) In Equity Method Investments [Roll Forward] | ||
Fair value of partnership interest, beginning balance | 227,210 | 223,802 |
Investment partnership gains (losses) | 49,207 | 5,752 |
Contributions | ||
Contributions | ||
Changes in proportionate share of Company stock held | 239 | (130) |
Fair value of partnership interest, ending balance | 276,656 | 229,424 |
Carry Value | ||
Increase (Decrease) In Equity Method Investments [Roll Forward] | ||
Fair value of partnership interest, beginning balance | 155,794 | 250,399 |
Investment partnership gains (losses) | 72,588 | (6,661) |
Contributions | 2,700 | |
Contributions | (1,500) | |
Changes in proportionate share of Company stock held | (239) | 130 |
Fair value of partnership interest, ending balance | $ 230,843 | $ 242,368 |
Investment Partnerships - Carrying Value (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Equity Method Investments and Joint Ventures [Abstract] | ||
Carrying value of investment partnerships | $ 230,843 | $ 155,794 |
Deferred tax liability related to investment partnerships | (40,410) | (23,643) |
Carrying value of investment partnerships net of deferred taxes | $ 190,433 | $ 132,151 |
Investment Partnerships - Narrative (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
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Equity Method Investments and Joint Ventures [Abstract] | |||
Deferred tax liability related to investment partnerships | $ 40,410,000 | $ 23,643,000 | |
Proportionate share of Company stock held by investment partnerships at cost | $ 409,919,000 | $ 409,680,000 | |
Incentive reallocation fee, percentage | 25.00% | ||
Hurdle rate, percentage | 6.00% | ||
Incentive reallocation fee | $ 0 | $ 0 |
Investment Partnerships - Gains and Losses (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
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Equity Method Investments and Joint Ventures [Abstract] | ||
Gains (losses) from investment partnerships | $ 72,588 | $ (6,661) |
Tax expense (benefit) | 16,559 | (1,860) |
Contribution to net earnings | $ 56,029 | $ (4,801) |
Investment Partnerships - Summarized Financial Information (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
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Schedule of Equity Method Investments [Line Items] | |||
Total assets | $ 907,218 | $ 828,474 | |
Total liabilities | 286,020 | 272,906 | |
Total earnings | $ 65,537 | $ (298) | |
Lion Fund, L.P. | |||
Schedule of Equity Method Investments [Line Items] | |||
Biglari Holdings' ownership interest | 88.60% | 62.50% | |
Lion Fund II, L.P. | |||
Schedule of Equity Method Investments [Line Items] | |||
Biglari Holdings' ownership interest | 86.10% | 93.90% | |
Lion Fund, L.P. | |||
Schedule of Equity Method Investments [Line Items] | |||
Total assets | $ 348,606 | 285,071 | |
Total liabilities | 10,373 | 10,517 | |
Total revenues | 63,558 | $ 969 | |
Total earnings | 63,404 | 926 | |
Lion Fund II, L.P. | |||
Schedule of Equity Method Investments [Line Items] | |||
Total assets | 415,057 | 330,832 | |
Total liabilities | 173,731 | $ 167,847 | |
Total revenues | 78,592 | (1,249) | |
Total earnings | $ 76,341 | $ (1,581) |
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Property, Plant and Equipment [Abstract] | ||
Land | $ 139,705 | $ 143,313 |
Buildings | 149,081 | 151,627 |
Land and leasehold improvements | 154,641 | 151,496 |
Equipment | 215,715 | 222,661 |
Oil and gas properties | 144,692 | 144,888 |
Construction in progress | 900 | 2,238 |
Total property and equipment | 804,734 | 816,223 |
Less accumulated depreciation, depletion, and amortization | (411,830) | (415,498) |
Property and equipment, net | $ 392,904 | $ 400,725 |
Property and Equipment - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Property, Plant and Equipment [Line Items] | |||
Depletion of oil and gas properties | $ 2,648 | $ 1,380 | |
Impairment of long-lived assets held-for-use | 776 | 0 | |
Asset held for sale | 8,012 | $ 4,700 | |
Gain on sale of assets | 1,590 | $ 133 | |
Steak n Shake | |||
Property, Plant and Equipment [Line Items] | |||
Gain on sale of assets | $ 1,431 |
Goodwill and Other Intangible Assets - Reconciliation of Goodwill (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $ 53,813 | |
Accumulated impairment losses | (300) | |
Goodwill | $ 53,522 | $ 53,513 |
Goodwill [Roll Forward] | ||
Goodwill beginning balance | 53,513 | |
Change in foreign exchange rates during the first quarter of 2023 | 9 | |
Goodwill ending balance | $ 53,522 |
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill impairment loss | $ 0 | $ 0 |
Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Goodwill [Line Items] | ||
Intangibles | $ 26,765 | |
Accumulated impairment losses | (3,728) | |
Intangible assets, net | $ 23,150 | 23,037 |
Finite-lived Intangible Assets [Roll Forward] | ||
Beginning balance | 23,037 | |
Change in foreign exchange rates during the first quarter of 2023 | 113 | |
Ending balance | 23,150 | |
Trade Names | ||
Goodwill [Line Items] | ||
Intangible assets, net | 15,876 | 15,876 |
Finite-lived Intangible Assets [Roll Forward] | ||
Beginning balance | 15,876 | |
Change in foreign exchange rates during the first quarter of 2023 | 0 | |
Ending balance | 15,876 | |
Lease Rights | ||
Goodwill [Line Items] | ||
Intangible assets, net | 7,274 | 7,161 |
Finite-lived Intangible Assets [Roll Forward] | ||
Beginning balance | 7,161 | |
Change in foreign exchange rates during the first quarter of 2023 | 113 | |
Ending balance | $ 7,274 | |
Trade Names | ||
Goodwill [Line Items] | ||
Intangibles | 15,876 | |
Accumulated impairment losses | 0 | |
Lease Rights | ||
Goodwill [Line Items] | ||
Intangibles | 10,889 | |
Accumulated impairment losses | $ (3,728) |
Restaurant Operations Revenues (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||
Restaurant operations | $ 90,176 | $ 85,372 |
Restaurant | ||
Disaggregation of Revenue [Line Items] | ||
Restaurant operations | 61,129 | 59,847 |
Net sales | Restaurant | ||
Disaggregation of Revenue [Line Items] | ||
Restaurant operations | 36,894 | 38,216 |
Franchise partner fees | Restaurant | ||
Disaggregation of Revenue [Line Items] | ||
Restaurant operations | 17,912 | 15,624 |
Franchise royalties and fees | Restaurant | ||
Disaggregation of Revenue [Line Items] | ||
Restaurant operations | 4,258 | 5,146 |
Other | Restaurant | ||
Disaggregation of Revenue [Line Items] | ||
Restaurant operations | $ 2,065 | $ 861 |
Restaurant Operations Revenues - Narrative (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Revenue from Contract with Customer [Abstract] | ||
Franchise partner fees sales percent | 15.00% | |
Franchise partner fees profits percent | 50.00% | |
Initial franchise partner fee | $ 10,000 | |
Rental fees | $ 5,575,000 | $ 4,774,000 |
Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Payables and Accruals [Abstract] | ||
Accounts payable | $ 30,932 | $ 28,431 |
Gift card and other marketing | 10,640 | 12,028 |
Insurance accruals | 2,479 | 6,012 |
Salaries and wages | 6,602 | 4,400 |
Deferred revenue | 5,835 | 4,445 |
Taxes payable | 15,500 | 14,896 |
Oil and gas payable | 4,641 | 3,877 |
Other | 2,615 | 4,527 |
Accounts payable and accrued expenses | $ 79,244 | $ 78,616 |
Line of Credit and Note Payable (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
Sep. 13, 2022 |
|
Line of Credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 6,500,000 | $ 10,000,000 | $ 30,000,000 |
Interest rate during period | 7.30% | ||
Revolving Credit Facility | Western Sizzlin Revolver | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 500,000 | ||
Long-term line of credit | $ 0 | $ 0 |
Unpaid losses and loss adjustment expense - Reconciliation of Changes in Claim Liabilities, Net of Reinsurance (Details) - USD ($) $ in Thousands |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||||
Gross liabilities | $ 17,721 | $ 14,025 | $ 17,520 | $ 14,993 |
Reinsurance recoverable on unpaid losses | 2,207 | 890 | $ 715 | $ 1,892 |
Amount of claim liabilities at the beginning of the year, net of reinsurance loss recoverable | 16,805 | 13,101 | ||
Incurred losses and loss adjustment expenses: | ||||
Current accident year | 10,247 | 9,721 | ||
Prior accident years | (1,651) | (133) | ||
Total | 8,596 | 9,588 | ||
Paid losses and loss adjustment expenses: | ||||
Current accident year | 4,433 | 5,577 | ||
Prior accident years | 5,454 | 3,977 | ||
Total | 9,887 | 9,554 | ||
Amount of claim liabilities at the end of each year, net of reinsurance loss recoverable | $ 15,514 | $ 13,135 |
Unpaid losses and loss adjustment expense - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Insurance [Abstract] | |||
Incurred losses and loss adjustment expenses | $ 8,596 | $ 9,588 | |
Reduction in provision for insured events of prior years | $ 1,651 | $ 133 | |
Reductions as a percentage of net liabilities | 9.80% | 1.00% |
Lease Assets and Obligations (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Current portion of lease obligations | ||
Finance lease liabilities | $ 1,242 | $ 1,237 |
Finance obligations | 5,139 | 5,161 |
Operating lease liabilities | 9,728 | 10,583 |
Total current portion of lease obligations | 16,109 | 16,981 |
Long-term lease obligations | ||
Finance lease liabilities | 3,779 | 4,129 |
Finance obligations | 58,428 | 58,868 |
Operating lease liabilities | 27,928 | 28,847 |
Total long-term lease obligations | $ 90,135 | $ 91,844 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Total current portion of lease obligations | Total current portion of lease obligations |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Total current portion of lease obligations | Total current portion of lease obligations |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Total long-term lease obligations | Total long-term lease obligations |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Total long-term lease obligations | Total long-term lease obligations |
Lease Assets and Obligations - Lease Cost (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Finance lease costs: | ||
Amortization of right-of-use assets | $ 242 | $ 363 |
Interest on lease liabilities | 91 | 115 |
Operating and variable lease costs | 3,167 | 3,612 |
Sublease income | (3,091) | (4,069) |
Total lease costs | $ 409 | $ 21 |
Lease Assets and Obligations - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Cash paid for amounts included in the measurement of lease liabilities: | ||
Financing cash flows from finance leases | $ 344 | $ 421 |
Operating cash flows from finance leases | 91 | 115 |
Operating cash flows from operating leases | $ 3,355 | $ 3,067 |
Lease Assets and Obligations - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Leases [Abstract] | ||
Finance leases: | $ 3,656 | $ 4,352 |
Lease Assets and Obligations - Weighted Average Lease Terms and Discount Rates (Details) |
Mar. 31, 2023 |
---|---|
Weighted-average remaining lease terms: | |
Finance leases | 4 years 1 month 9 days |
Operating leases | 4 years 8 months 4 days |
Weighted-average discount rates: | |
Finance leases | 7.00% |
Operating leases | 7.00% |
Lease Assets and Obligations - Lease Maturity Schedule (Details) $ in Thousands |
Mar. 31, 2023
USD ($)
|
---|---|
Operating Leases | |
Remainder of 2023 | $ 9,210 |
2024 | 10,228 |
2025 | 8,437 |
2026 | 5,868 |
2027 | 3,503 |
After 2027 | 7,028 |
Total lease payments | 44,274 |
Less interest | 6,618 |
Total lease liabilities | 37,656 |
Finance Leases | |
Remainder of 2023 | 1,134 |
2024 | 1,534 |
2025 | 1,298 |
2026 | 959 |
2027 | 623 |
After 2027 | 232 |
Total lease payments | 5,780 |
Less interest | 759 |
Total lease liabilities | $ 5,021 |
Lease Assets and Obligations - Lease Income (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Leases [Abstract] | ||
Operating lease income | $ 4,085 | $ 4,724 |
Variable lease income | 1,784 | 313 |
Total lease income | $ 5,869 | $ 5,037 |
Lease Assets and Obligations - Future Minimum Rental Receipts (Details) $ in Thousands |
Mar. 31, 2023
USD ($)
|
---|---|
Subleases | |
Operating Leases | |
Remainder of 2023 | $ 520 |
2024 | 503 |
2025 | 454 |
2026 | 134 |
2027 | 116 |
After 2027 | 125 |
Total future minimum receipts | 1,852 |
Owned Properties | |
Operating Leases | |
Remainder of 2023 | 119 |
2024 | 265 |
2025 | 265 |
2026 | 275 |
2027 | 275 |
After 2027 | 2,315 |
Total future minimum receipts | $ 3,514 |
Income Taxes - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) | $ 19,738 | $ (171) |
Investment partnership pretax gains (losses) | $ 72,588 | $ (6,661) |
Fair Value of Financial Assets (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Assets | ||
Cash equivalents | $ 25,209 | $ 17,608 |
Non-qualified deferred compensation plan investments | 684 | 699 |
Total assets at fair value | 106,051 | 88,267 |
Consumer goods | ||
Assets | ||
Equity securities | 22,337 | 17,274 |
Other | ||
Assets | ||
Equity securities | 2,555 | 2,031 |
Government | ||
Assets | ||
Bonds | 53,663 | 48,456 |
Corporate | ||
Assets | ||
Bonds | 1,603 | 2,199 |
Level 1 | ||
Assets | ||
Cash equivalents | 25,209 | 17,608 |
Non-qualified deferred compensation plan investments | 684 | 699 |
Total assets at fair value | 106,051 | 88,267 |
Level 1 | Consumer goods | ||
Assets | ||
Equity securities | 22,337 | 17,274 |
Level 1 | Other | ||
Assets | ||
Equity securities | 2,555 | 2,031 |
Level 1 | Government | ||
Assets | ||
Bonds | 53,663 | 48,456 |
Level 1 | Corporate | ||
Assets | ||
Bonds | 1,603 | 2,199 |
Level 2 | ||
Assets | ||
Cash equivalents | 0 | 0 |
Non-qualified deferred compensation plan investments | 0 | 0 |
Total assets at fair value | 0 | 0 |
Level 2 | Consumer goods | ||
Assets | ||
Equity securities | 0 | 0 |
Level 2 | Other | ||
Assets | ||
Equity securities | 0 | 0 |
Level 2 | Government | ||
Assets | ||
Bonds | 0 | 0 |
Level 2 | Corporate | ||
Assets | ||
Bonds | 0 | 0 |
Level 3 | ||
Assets | ||
Cash equivalents | 0 | 0 |
Non-qualified deferred compensation plan investments | 0 | 0 |
Total assets at fair value | 0 | 0 |
Level 3 | Consumer goods | ||
Assets | ||
Equity securities | 0 | 0 |
Level 3 | Other | ||
Assets | ||
Equity securities | 0 | 0 |
Level 3 | Government | ||
Assets | ||
Bonds | 0 | 0 |
Level 3 | Corporate | ||
Assets | ||
Bonds | $ 0 | $ 0 |
Related Party Transactions - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Related Party Transaction [Line Items] | ||
Hurdle rate, percentage | 6.00% | |
Incentive reallocation fee, percentage | 25.00% | |
Biglari Entities | ||
Related Party Transaction [Line Items] | ||
Hurdle rate, percentage | 6.00% | |
Incentive reallocation fee, percentage | 25.00% | |
Biglari Entities | Services Agreement | ||
Related Party Transaction [Line Items] | ||
Management fee expense | $ 2,100 | $ 2,100 |
Business Segment Reporting - Disaggregation of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Segment Reporting Information [Line Items] | ||
Restaurant operations | $ 90,176 | $ 85,372 |
Restaurant Operations | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 61,129 | 59,847 |
Restaurant Operations | Steak n Shake | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 58,487 | 57,753 |
Restaurant Operations | Western Sizzlin | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 2,642 | 2,094 |
Insurance Operations | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 16,229 | 15,079 |
Insurance Operations | Insurance Investment Income And Other | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 1,465 | 910 |
Insurance Operations | First Guard | Insurance Underwriting | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 8,899 | 8,731 |
Insurance Operations | Southern Pioneer | Insurance Underwriting | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 5,865 | 5,438 |
Oil and Gas Operations | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 12,223 | 9,812 |
Oil and Gas Operations | Abraxas Petroleum | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 7,252 | 0 |
Oil and Gas Operations | Southern Oil | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | 4,971 | 9,812 |
Maxim | ||
Segment Reporting Information [Line Items] | ||
Restaurant operations | $ 595 | $ 634 |
Business Segment Reporting - Earnings (Losses) Before Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Segment Reporting Information [Line Items] | ||
Investment gains | $ 3,638 | $ 225 |
Investment partnership gains (losses) | 72,588 | (6,661) |
Earnings (loss) before income taxes | 85,275 | (469) |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 12,642 | 9,379 |
Interest expense not allocated to segments | (167) | 0 |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Corporate and other | (3,593) | (3,412) |
Investment gains | 3,638 | 225 |
Investment partnership gains (losses) | 72,588 | (6,661) |
Restaurant Operations | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 7,797 | 4,430 |
Restaurant Operations | Operating Segments | Steak n Shake | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 7,325 | 4,198 |
Restaurant Operations | Operating Segments | Western Sizzlin | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 472 | 232 |
Insurance Operations | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 2,787 | 1,364 |
Insurance Operations | Operating Segments | Insurance Investment Income And Other | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 1,036 | 969 |
Insurance Operations | Operating Segments | First Guard | Insurance Underwriting | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 1,862 | 732 |
Insurance Operations | Operating Segments | Southern Pioneer | Insurance Underwriting | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | (111) | (337) |
Oil and Gas Operations | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 2,103 | 3,921 |
Oil and Gas Operations | Operating Segments | Abraxas Petroleum | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 1,209 | 0 |
Oil and Gas Operations | Operating Segments | Southern Oil | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | 894 | 3,921 |
Maxim | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Earnings (Losses) Before Income Taxes | $ 122 | $ (336) |
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