Note 16 - Supplemental Condensed Consolidating Financial Statements

12 Months Ended

Jun. 03, 2014

Disclosure Text Block Supplement [Abstract]

Condensed Financial Statements [Text Block]

16. Supplemental Condensed Consolidating Financial Statements

As discussed in Note 8 to the Consolidated Financial Statements, the Senior Notes are a liability of Ruby Tuesday, Inc. (the “Parent”) and are guaranteed on a senior unsecured basis by our existing and future domestic restricted subsidiaries, subject to certain exceptions (the “Guarantors”). Each of the Guarantors is wholly-owned by Ruby Tuesday, Inc. None of the few remaining subsidiaries of Ruby Tuesday, Inc., which were primarily created to hold liquor license assets, guarantee the Senior Notes (the “Non-Guarantors”). Our Non-Guarantor subsidiaries are immaterial and are aggregated within the Parent information disclosed below.

The following condensed consolidating financial information, which has been prepared in accordance with the requirements for presentation of Rule 3-10(f) of Regulation S-X promulgated by the Securities and Exchange Commission, presents the condensed consolidating financial information separately for the Parent, the Guarantors, and elimination entries necessary to consolidate the Parent and Guarantors. Investments in wholly-owned subsidiaries are accounted for using the equity method for purposes of the consolidated presentation. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.

Condensed Consolidating Balance Sheet

As of June 3, 2014

(In thousands)

	Parent			Guarantors		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	51,012		$	314	$	-		$	51,326
Accounts receivable		1,725			3,136		-			4,861
Inventories		15,114			6,060		-			21,174
Income tax receivable		138,524					(136,391	)		2,133
Deferred income taxes		(548	)		3,945		-			3,397
Other current assets		14,610			2,289		-			16,899
Total current assets		220,437			15,744		(136,391	)		99,790
Property and equipment, net		587,783			207,063		-			794,846
Investment in subsidiaries		158,266			-		(158,266	)		-
Due from/(to) subsidiaries		78,612			243,665		(322,277	)		-
Other assets		48,780			13,011		-			61,791
Total assets	$	1,093,878		$	479,483	$	(616,934	)	$	956,427
Liabilities & Shareholders’ Equity
Current liabilities:
Accounts payable	$	20,545		$	5,656	$	-		$	26,201
Accrued and other current liabilities		46,450			36,356		-			82,806
Current maturities of long-term debt, including capital leases		(341	)		5,157					4,816
Income tax payable		-			136,391		(136,391	)		-
Total current liabilities		66,654			183,560		(136,391	)		113,823
Long-term debt and capital leases, less current maturities		213,039			40,836		-			253,875
Deferred income taxes		(445	)		3,945		-			3,500
Due to/(from) subsidiaries		243,665			78,612		(322,277	)		-
Other deferred liabilities		109,756			14,264		-			124,020
Total liabilities		632,669			321,217		(458,668	)		495,218
Shareholders’ equity:
Common stock		614			-		-			614
Capital in excess of par value		76,269			-		-			76,269
Retained earnings		395,226			158,266		(158,266	)		395,226
Accumulated other comprehensive loss		(10,900	)		-		-			(10,900	)
Total shareholders’ equity		461,209			158,266		(158,266	)		461,209
Total liabilities & shareholders’ equity	$	1,093,878		$	479,483	$	(616,934	)	$	956,427

Condensed Consolidating Balance Sheet

As of June 4, 2013

(In thousands)

	Parent			Guarantors		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	52,635		$	272	$	-		$	52,907
Accounts receivable		1,854			2,980		-			4,834
Inventories		21,961			8,911		-			30,872
Income tax receivable		118,329			-		(116,429	)		1,900
Deferred income taxes		5,372			1,924		-			7,296
Other current assets		19,519			3,836		-			23,355
Total current assets		219,670			17,923		(116,429	)		121,164
Property and equipment, net		635,478			224,352		-			859,830
Investment in subsidiaries		167,887			-		(167,887	)		-
Due from/(to) subsidiaries		76,485			230,583		(307,068	)		-
Other assets		46,812			15,377	–				62,189
Total assets	$	1,146,332		$	488,235	$	(591,384	)	$	1,043,183
Liabilities & Shareholders’ Equity
Current liabilities:
Accounts payable	$	11,725		$	3,239	$	-		$	14,964
Accrued and other current liabilities		47,775			34,406		-			82,181
Current maturities of long-term debt, including capital leases		(347	)		8,834					8,487
Income tax payable		-			116,429		(116,429	)		-
Total current liabilities		59,153			162,908		(116,429	)		105,632
Long-term debt and capital leases, less current maturities		232,462			58,053		-			290,515
Deferred income taxes		(1,070	)		6,823		-			5,753
Due to/(from) subsidiaries		230,583			76,485		(307,068	)		-
Other deferred liabilities		108,369			16,079		-			124,448
Total liabilities		629,497			320,348		(423,497	)		526,348
Shareholders’ equity:
Common stock		612			-		-			612
Capital in excess of par value		67,596			-		-			67,596
Retained earnings		459,572			167,887		(167,887	)		459,572
Accumulated other comprehensive loss		(10,945	)		-		-			(10,945	)
Total shareholders’ equity		516,835			167,887		(167,887	)		516,835
Total liabilities & shareholders’ equity	$	1,146,332		$	488,235	$	(591,384	)	$	1,043,183

Condensed Consolidating Statement of Operations and

Comprehensive (Loss)/Income

For the Fiscal Year Ended June 3, 2014

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	842,842		$	319,581		$	-		$	1,162,423
Franchise revenue		223			6,100			-			6,323
		843,065			325,681			-			1,168,746
Operating costs and expenses:
Cost of merchandise		233,562			87,959			-			321,521
Payroll and related costs		287,358			117,021			-			404,379
Other restaurant operating costs		187,055			73,392			-			260,447
Depreciation		40,188			14,640			-			54,828
Selling, general, and administrative		87,248			49,903			-			137,151
Intercompany selling, general, and administrative allocations		59,257			(59,257	)		-			-
Closures and impairments		18,904			13,927			-			32,831
Trademark impairment		-			855			-			855
Equity in earnings of subsidiaries		(21,005	)		-			21,005			-
Interest expense, net		19,978			4,967			-			24,945
Intercompany interest expense/(income)		13,081			(13,081	)		-			-
Loss on extinguishment of debt		1,364			-			-			1,364
		926,990			290,326			21,005			1,238,321
(Loss)/income from continuing operations before income taxes		(83,925	)		35,355			(21,005	)		(69,575	)
(Benefit)/provision for income taxes from continuing operations		(19,015	)		14,350			-			(4,665	)
(Loss)/income from continuing operations		(64,910	)		21,005			(21,005	)		(64,910	)
Income from discontinued operations, net of tax		564			-			-			564
Net (loss)/income	$	(64,346	)	$	21,005		$	(21,005	)	$	(64,346	)
Other comprehensive income:
Pension liability reclassification, net of tax		45			-			-			45
Total comprehensive (loss)/income	$	(64,301	)	$	21,005		$	(21,005	)	$	(64,301	)

Condensed Consolidating Statement of Operations and

Comprehensive (Loss)/Income

For the Fiscal Year Ended June 4, 2013

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	904,761		$	340,465		$	-		$	1,245,226
Franchise revenue		188			6,073			-			6,261
		904,949			346,538			-			1,251,487
Operating costs and expenses:
Cost of merchandise		248,378			93,134			-			341,512
Payroll and related costs		298,194			121,485			-			419,679
Other restaurant operating costs		185,224			73,790			-			259,014
Depreciation		43,541			15,581			-			59,122
Selling, general, and administrative		91,587			47,195			-			138,782
Intercompany selling, general, and administrative allocations		68,466			(68,466	)		-			-
Closures and impairments		13,181			1,475			-			14,656
Goodwill and trademark impairments		9,023			5,035			-			14,058
Equity in earnings of subsidiaries		(38,485	)		-			38,485			-
Interest expense, net		20,920			5,656			-			26,576
Intercompany interest expense/(income)		13,826			(13,826	)		-			-
Loss on extinguishment of debt		22			-			-			22
		953,877			281,059			38,485			1,273,421
(Loss)/income from continuing operations before income taxes		(48,928	)		65,479			(38,485	)		(21,934	)
Provision/(benefit) for income taxes from continuing operations		(25,494	)		26,994			-			1,500
(Loss)/income from continuing operations		(23,434	)		38,485			(38,485	)		(23,434	)
Loss from discontinued operations, net of tax		(15,979	)		(810	)		810			(15,979	)
Net (loss)/income	$	(39,413	)	$	37,675		$	(37,675	)	$	(39,413	)
Other comprehensive income:
Pension liability reclassification, net of tax		3,312			-			-			3,312
Total comprehensive (loss)/income	$	(36,101	)	$	37,675		$	(37,675	)	$	(36,101	)

Condensed Consolidating Statement of Operations and

Comprehensive (Loss)/Income

For the Fiscal Year Ended June 5, 2012

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	944,501		$	361,524		$	-		$	1,306,025
Franchise revenue		216			5,522			-			5,738
		944,717			367,046			-			1,311,763
Operating costs and expenses:
Cost of merchandise		271,559			104,014			-			375,573
Payroll and related costs		309,854			130,899			-			440,753
Other restaurant operating costs		186,754			75,819			-			262,573
Depreciation		47,475			16,669			-			64,144
Selling, general, and administrative		79,594			40,770			-			120,364
Intercompany selling, general, and administrative allocations		71,670			(71,670	)		-			-
Closures and impairments		12,282			4,469			-			16,751
Goodwill impairment		1,440			15,479			-			16,919
Equity in earnings of subsidiaries		(35,905	)		-			35,905			-
Interest expense, net		13,295			10,017			-			23,312
Intercompany interest expense/(income)		13,096			(13,096	)		-			-
		971,114			313,370			35,905			1,320,389
(Loss)/income from continuing operations before income taxes		(26,397	)		53,676			(35,905	)		(8,626	)
(Benefit)/provision for income taxes from continuing operations		(29,923	)		17,771			-			(12,152	)
Income from continuing operations		3,526			35,905			(35,905	)		3,526
Loss from discontinued operations, net of tax		(3,714	)		(1,392	)		1,392			(3,714	)
Net (loss)/income	$	(188	)	$	34,513		$	(34,513	)	$	(188	)
Other comprehensive (loss)/income:
Pension liability reclassification, net of tax		(1,205	)		-			-			(1,205	)
Total comprehensive (loss)/income	$	(1,393	)	$	34,513		$	(34,513	)	$	(1,393	)

Condensed Consolidating Statement of Cash Flows

For the Fiscal Year Ended June 3, 2014

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Net cash provided by operating activities	$	5,854		$	57,064		$	(17,543	)	$	45,375
Investing activities:
Purchases of property and equipment		(21,132	)		(7,207	)		-			(28,339	)
Proceeds from sale-leaseback transactions, net		5,637			-			-			5,637
Proceeds from disposal of assets		14,503			1,023			-			15,526
Other, net		973			-			-			973
Net cash used by investing activities		(19	)		(6,184	)		-			(6,203	)
Financing activities:
Principal payments on long-term debt		(20,019	)		(20,213	)		-			(40,232	)
Stock repurchases		(579	)		-			-			(579	)
Proceeds from exercise of stock options		1,576			-			-			1,576
Payments for debt issuance costs		(1,802	)		-			-			(1,802	)
Excess tax benefits from share-based compensation		284			-			-			284
Intercompany transactions		13,082			(30,625	)		17,543			-
Net cash used by financing activities		(7,458	)		(50,838	)		17,543			(40,753	)
(Decrease)/increase in cash and cash equivalents		(1,623	)		42			-			(1,581	)
Cash and cash equivalents:
Beginning of year		52,635			272			-			52,907
End of year	$	51,012		$	314		$	-		$	51,326

Condensed Consolidating Statement of Cash Flows

For the Fiscal Year Ended June 4, 2013

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Net cash provided by operating activities	$	34,877		$	89,925		$	(88,848	)	$	35,954
Investing activities:
Purchases of property and equipment		(31,531	)		(5,586	)		-			(37,117	)
Proceeds from sale-leaseback transactions, net		51,765			-			-			51,765
Proceeds from disposal of assets		4,421			2,576			-			6,997
Other, net		468			-			-			468
Net cash used by investing activities		25,123			(3,010	)		-			22,113
Financing activities:
Principal payments on long-term debt		(14,514	)		(12,666	)		-			(27,180	)
Stock repurchases		(30,278	)		-			-			(30,278	)
Proceeds from exercise of stock options		4,090			-			-			4,090
Payments for debt issuance costs		(358	)		-			-			(358	)
Excess tax benefits from share-based compensation		382			-			-			382
Intercompany transactions		(14,673	)		(74,175	)		88,848			-
Net cash used by financing activities		(55,351	)		(86,841	)		88,848			(53,344	)
Increase in cash and cash equivalents		4,649			74			-			4,723
Cash and cash equivalents:
Beginning of year		47,986			198			-			48,184
End of year	$	52,635		$	272		$	-		$	52,907

Condensed Consolidating Statement of Cash Flows

For the Fiscal Year Ended June 5, 2012

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Net cash provided by operating activities	$	48,516		$	105,820		$	(42,085	)	$	112,251
Investing activities:
Purchases of property and equipment		(28,253	)		(9,713	)		-			(37,966	)
Acquisition of franchise and other entities, net		(24,084	)		-			-			(24,084	)
Proceeds from sale-leaseback transactions		21,150			-			-			21,150
Proceeds from disposal of assets		5,834			160			-			5,994
Other, net		1,151			-			-			1,151
Net cash used by investing activities		(24,202	)		(9,553	)		-			(33,755	)
Financing activities:
Proceeds from issuance of senior unsecured notes		246,340			-						246,340
Net payments on revolving credit facility		(177,000	)		-			-			(177,000	)
Principal payments on long-term debt		(44,437	)		(41,120	)		-			(85,557	)
Stock repurchases		(18,441	)		-			-			(18,441	)
Payment for debt issuance costs		(5,767	)		-			-			(5,767	)
Proceeds from exercise of stock options		355			-			-			355
Excess tax benefits from share-based compensation		36			-			-			36
Intercompany transactions		13,096			(55,181	)		42,085			-
Net cash provided/(used) by financing activities		14,182			(96,301	)		42,085			(40,034	)
Increase/(decrease) in cash and cash equivalents		38,496			(34	)		-			38,462
Cash and cash equivalents:
Beginning of year		9,490			232			-			9,722
End of year	$	47,986		$	198		$	-		$	48,184