8-K
PAPA JOHNS INTERNATIONAL INC (PZZA)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
September 29, 2020
Commission File Number: 000-21660
PAPA JOHN’S INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 61-1203323 |
|---|---|
| (State or other jurisdiction of | (I.R.S. Employer Identification |
| incorporation or organization) | Number) |
2002 Papa Johns Boulevard
Louisville, Kentucky 40299-2367
(Address of principal executive offices)
(502) 261-7272
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class: | Trading Symbol | Name of each exchange on which registered: |
|---|---|---|
| Common stock, $0.01 par value | PZZA | The NASDAQ Stock Market LLC |
Item 2.02. Results of Operations and Financial Condition.
On September 29, 2020, Papa John’s International, Inc. (the “Company”) issued a press release announcing preliminary estimates for comparable sales information for the fiscal quarter ended September 27, 2020. A copy of the press release is being furnished as Exhibit 99.1 attached hereto.
Item 7.01. Regulation FD Disclosure.
The press release also provides an update regarding the impact of the coronavirus (COVID-19) pandemic on the Company’s business. A copy of the press release is being furnished as Exhibit 99.1 attached hereto.
The information in the press release is being furnished, not filed, pursuant to Items 2.02 and 7.01 of Form 8-K. Accordingly, the information in Items 2.02 and 7.01 of this Current Report, including Exhibit 99.1, will not be incorporated by reference into any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated by reference.
Section 9 – Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
| Exhibit<br><br> <br>Number | Description |
|---|---|
| 99.1 | Papa John’s International, Inc. press release dated September 29, 2020. |
| 104 | Cover Page Interactive Data File – the cover page XBRL tags are embedded within the Inline XBRL Document |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
PAPA JOHN’S INTERNATIONAL, INC.
(Registrant)
| Date: September 29, 2020 | /s/ Steven R. Coke |
|---|---|
| Steven R. Coke | |
| Interim Principal Financial and Accounting | |
| Officer |
EXHIBIT INDEX
| Exhibit<br><br> Number | Description of Exhibit |
|---|---|
| 99.1 | Papa John’s International, Inc. press release dated September 29, 2020. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Exhibit 99.1
Papa John’s Sustains Strong North America and International Comparable Sales in September
LOUISVILLE, Ky.--(BUSINESS WIRE)--September 29, 2020--Papa John’s International, Inc. (NASDAQ: PZZA) **** today provided preliminary estimated comparable sales information for the month of September and the third quarter fiscal period. In light of the uncertainty related to the pandemic, the company has continued to provide this information on a monthly basis.
President & CEO Rob Lynch said, “Six consecutive months of double-digit comparable sales growth were made possible by the hard work of Papa John’s team members and franchisees during the global pandemic. We remain confident that our innovation pipeline, marketing and technology platforms, and strong operations will continue to support strong results during, and after, the pandemic.”
Preliminary Estimated Comparable Sales for September 2020 Fiscal Period and Third Quarter
Preliminary estimated comparable sales information for the five weeks and the fiscal quarter ended September 27, 2020, relative to the same periods in the prior year are as follows:
| Period 9 | Third Quarter | |
|---|---|---|
| August 24, 2020 to <br><br> September 27, 2020 | Three months ended <br><br> September 27, 2020 | |
| Comparable sales growth ^(a)^<br><br> <br><br> | ||
| Domestic company-owned restaurants | 14.3% | 18.2% |
| North America franchised restaurants | 19.7% | 25.5% |
| System-wide North America restaurants | 18.4% | 23.8% |
| System-wide international restaurants ^(b)^ | 23.3% | 20.6% |
| (a) | Represents the change in year-over-year sales for the same base of restaurants for the same fiscal period. Comparable sales results for restaurants operating outside of the United States<br> are reported on a constant-dollar basis, which excludes the impact of foreign currency translation. | |
| --- | --- | |
| (b) | Includes the impact of approximately 90 temporarily closed stores as of September 27, 2020, principally in Latin America and Europe. Excluding those stores, comparable sales growth for<br> system-wide international restaurants would have been approximately 25% in Period 9 and 23% in the third quarter. |
Update on Temporary Restaurant Closures as a Result of COVID-19
Of the company’s approximately 2,100 international franchised stores, approximately 90 are temporarily closed, primarily in Latin America and Europe, in accordance with government policies. In North America, almost all traditional restaurants remain open and fully operational. A number of non-traditional restaurants located in universities and stadiums are temporarily closed; these non-traditional locations are not material to the company’s revenues and operating results.
About Comparable Sales
The Company believes North America and international comparable sales growth information, as defined in the table above, is useful in analyzing its results since franchisees pay royalties and marketing fund contributions that are based on a percentage of franchise sales. Franchise sales also generate commissary revenue in the United States and in certain international markets. Franchise restaurant and comparable sales growth information is also useful for comparison to industry trends and evaluating the strength of our brand. Management believes the presentation of franchise restaurant sales growth, excluding the impact of foreign currency, provides investors with useful information regarding underlying sales trends and the impact of new unit growth without being impacted by swings in the external factor of foreign currency. Franchise restaurant sales are not included in the company’s revenues.
Forward-Looking Statements
Certain matters discussed in this press release and other company communications that are not statements of historical fact constitute forward-looking statements within the meaning of the federal securities laws. Generally, the use of words such as “expect,” “intend,” “estimate,” “believe,” “anticipate,” “will,” “forecast,” “plan,” “project,” or similar words identify forward-looking statements that we intend to be included within the safe harbor protections provided by the federal securities laws. Such forward-looking statements include or may relate to the preliminary estimated same store sales growth and related trends, projections or guidance concerning business performance, revenue, earnings, cash flow, earnings per share, the financial impact of the temporary business opportunities, disruptions and temporary changes in demand we are experiencing related to the current outbreak of the novel coronavirus disease (COVID-19) including the projections for sales trends and comparable sales, our cash on hand and access to our credit facilities, commodity costs, currency fluctuations, profit margins, unit growth, unit level performance, capital expenditures, restaurant and franchise development, the duration of changes in consumer behavior caused by the pandemic, the duration and number of temporary store closures, royalty relief, the effectiveness of our strategic turnaround efforts and other business initiatives, marketing efforts, liquidity, compliance with debt covenants, stockholder and other stakeholder engagement, strategic decisions and actions, dividends, effective tax rates, regulatory changes and impacts, adoption of new accounting standards, and other financial and operational measures. Such statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict and many of which are beyond our control. Our forward-looking statements are based on our assumptions which are based on currently available information, including assumptions about our ability to manage difficulties associated with or related to the COVID-19 pandemic, including risks related to: the impact of governmental restrictions on freedom of movement and business operations including quarantines, social distancing requirements and mandatory business closures; the virus’s impact on the availability of our workforce; the potential disruption of our supply chain; changes in consumer demand or behavior; the overall contraction in global economic activity, including rising unemployment; our liquidity position; our ability to navigate changing governmental programs and regulations relating to the pandemic; and the increased risk of phishing and other cyber-attacks. Therefore, actual outcomes and results may differ materially from those matters expressed or implied in such forward-looking statements. Other risks, uncertainties and assumptions that are involved in our forward-looking statements are discussed in detail in “Part I. Item 1A. – Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 29, 2019, and in “Part II. Item 1A. – Risk Factors” in our Quarterly Report on Form 10-Q for the first quarter ended March 29, 2020. We undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise, except as required by law.
For more information about the company, please visit www.papajohns.com.
Contacts
Investor Contact:
Steve Coke
Interim Principal Financial and Accounting Officer
Steve\_Coke@papajohns.com
502-261-7272
Media Contact:
Madeline Chadwick
Senior Vice President, Communications and Corporate Affairs
Madeline\_Chadwick@papajohns.com
502-261-4189