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Sep 30, 2020
Dine Brands Q3 2020 Earnings Report
Dine Brands showcased improved sales trends and off-premise growth, while maintaining a strong liquidity and cash position.
Key Takeaways
Dine Brands Global, Inc. reported financial results for the third quarter of 2020, with both Applebee's and IHOP showing continued improvements. Off-premise growth drove robust sales as government restrictions eased. As of September 30, 97% of domestic restaurants were open. The company had $389.6 million in total cash.
Applebee’s comparable same-restaurant sales improved 10 out of 13 weeks through the week ended September 27, 2020 from a decline of 22.3% to an increase of 0.4%.
IHOP’s comparable same-restaurant sales improved 10 out of 13 weeks through the week ended September 27, 2020 from a decline of 40.4% to a decline of 23.5%.
Applebee’s off-premise sales accounted for 34.6% of sales mix for the third quarter of 2020.
IHOP’s off-premise sales accounted for 32.4% of sales mix for the third quarter of 2020.
Revenue by Segment
Forward Guidance
The Company expects the trajectory for domestic system-wide comparable same-restaurant sales for both Applebee’s and IHOP to gradually improve. Domestic development activity by Applebee’s franchisees is expected to result in net closures of approximately 15 restaurants in the fourth quarter of 2020. Based on the Company’s current assessment, it expects the evaluation could result in the net closure of less than 100 IHOP restaurants over the next 6 months. General and administrative expenses for the fourth quarter of 2020 are expected to be approximately $45 million, including non-cash stock-based compensation expense and depreciation totaling approximately $7 million.
Positive Outlook
- Trajectory for domestic system-wide comparable same-restaurant sales for both Applebee’s and IHOP to gradually improve.
Challenges Ahead
- Domestic development activity by Applebee’s franchisees is expected to result in net closures of approximately 15 restaurants in the fourth quarter of 2020.
- Evaluation could result in the net closure of less than 100 IHOP restaurants over the next 6 months.
- General and administrative expenses for the fourth quarter of 2020 are expected to be approximately $45 million, including non-cash stock-based compensation expense and depreciation totaling approximately $7 million.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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