SEGMENT INFORMATION

3 Months Ended

Sep. 23, 2020

Segment Reporting [Abstract]

Segment Information

Our operating segments are Chili’s and Maggiano’s. The Chili’s segment includes the results of our Company-owned Chili’s restaurants, principally in the United States, within the full-service casual dining segment of the industry. The Chili’s segment also has Company-owned restaurants in Canada, and franchised locations in the United States, 28 countries and two United States territories. The Maggiano’s segment includes the results of our Company-owned Maggiano’s restaurants in the United States as well as the results from our domestic franchise business.

Company sales include revenues generated by the operation of Company-owned restaurants including gift card redemptions and virtual brand revenues. Franchise and other revenues include Royalties and Franchise fees and other revenues. Franchise fees and other revenues include delivery service income, gift card breakage, franchise advertising fees, digital entertainment revenues, franchise and development fees, Maggiano’s banquet service charge income, gift card equalization, merchandise income, and gift card discount costs from third-party gift card sales. We do not rely on any major customers as a source of sales, and the customers and long-lived assets of our

operating segments are predominantly in the United States. There were no material transactions amongst our operating segments.

Our chief operating decision maker uses Operating income as the measure for assessing performance of our segments. Operating income includes revenues and expenses directly attributable to segment-level results of operations. Restaurant expenses during the periods presented primarily included restaurant rent, supplies, utilities, delivery fees, repairs and maintenance, property taxes, credit card processing fees and advertising. The following tables reconcile our segment results to our consolidated results reported in accordance with GAAP:

	Thirteen Week Period Ended September 23, 2020
	Chili’s		Maggiano’s		Other		Consolidated
Company sales	$	675.0	$	53.2	$	—	$	728.2
Royalties	6.6		0.0		—		6.6
Franchise fees and other revenues	4.9		0.4		—		5.3
Franchise and other revenues	11.5		0.4		—		11.9
Total revenues	686.5		53.6		—		740.1
Food and beverage costs	180.8		12.7		—		193.5
Restaurant labor	228.2		19.8		—		248.0
Restaurant expenses	181.4		20.8		0.3		202.5
Depreciation and amortization	30.6		3.6		3.2		37.4
General and administrative	5.4		1.3		23.8		30.5
Other (gains) and charges	3.6		0.1		0.1		3.8
Total operating costs and expenses	630.0		58.3		27.4		715.7
Operating income (loss)	56.5		(4.7)		(27.4)		24.4
Interest expenses	1.4		—		13.2		14.6
Other income, net	(0.1)		—		(0.3)		(0.4)
Income (loss) before income taxes	$	55.2	$	(4.7)	$	(40.3)	$	10.2
Segment assets	$	1,937.1	$	221.8	$	176.4	$	2,335.3
Segment goodwill	149.3		38.4		—		187.7
Payments for property and equipment	11.6		0.5		1.5		13.6

	Thirteen Week Period Ended September 25, 2019
	Chili’s(1)		Maggiano’s		Other		Consolidated
Company sales	$	677.5	$	86.4	$	—	$	763.9
Royalties	11.8		0.1		—		11.9
Franchise fees and other revenues	6.3		3.9		—		10.2
Franchise and other revenues	18.1		4.0		—		22.1
Total revenues	695.6		90.4		—		786.0
Food and beverage costs	182.4		21.4		—		203.8
Restaurant labor	233.1		35.4		—		268.5
Restaurant expenses	180.8		26.3		0.2		207.3
Depreciation and amortization	30.7		4.0		3.4		38.1
General and administrative	9.1		1.7		27.2		38.0
Other (gains) and charges	(1.6)		0.1		0.6		(0.9)
Total operating costs and expenses	634.5		88.9		31.4		754.8
Operating income (loss)	61.1		1.5		(31.4)		31.2
Interest expenses	0.9		—		14.0		14.9
Other income, net	(0.2)		—		(0.3)		(0.5)
Income (loss) before income taxes	$	60.4	$	1.5	$	(45.1)	$	16.8
Payments for property and equipment	$	16.1	$	2.3	$	2.1	$	20.5

(1)Chili’s segment information for fiscal 2020 includes the results of operations related to the 116 restaurants purchased from a former franchisee subsequent to the September 5, 2019 acquisition date. Refer to Note 15 - Fiscal 2020 Chili’s Restaurant Acquisition for details.