Denny’s(US:DENN)2022-02-27 16:00Sales Performance - Denny's reported that off-premise sales, including delivery and virtual brands, represented approximately 27% of total sales in 2021[8]. - The average daily sales breakdown by daypart was 28% for breakfast, 37% for lunch, 22% for dinner, and 13% for late night[8]. - In 2021, 36% of an average week of sales occurred from Friday late night through Sunday lunch[8]. - The company experienced improving sales performance in 2021, although many restaurants had not returned to full operating hours, particularly during the late night daypart[10]. - The domestic contractual royalty rate averaged approximately 4.35% during 2021[12]. - The restaurant sales are generally higher in the second and third calendar quarters (April through September) compared to the first and fourth quarters (October through March)[61]. Restaurant Operations - As of December 29, 2021, Denny's had 1,640 total restaurants, with 65 company restaurants and 1,575 franchised and licensed restaurants[22]. - The company opened 20 franchised and licensed restaurants in 2021, while closing 30[22]. - Denny's achieved a restaurant portfolio mix of 96% franchised and 4% company restaurants[20]. - Denny's has potential to develop approximately 126 international franchised restaurants over the next ten years[18]. - The company had approximately 92 domestic development commitments as of December 29, 2021, following the refranchising and development strategy implemented during 2018 and 2019[17]. - Denny's opened eight international franchised locations in 2021, including five in Canada and one each in Guatemala, Mexico, and the Philippines[18]. - As of December 29, 2021, 36.2% of franchisees owned one restaurant, while 38.7% of total restaurants were owned by franchisees with 31 or more locations[22]. Franchise Relations - Approximately 80% of franchised restaurants operated under traditional agreements with a royalty payment of up to 4.5% of gross sales[12]. - The company provided direct financial relief to franchise partners, including deferrals of remodels and royalty fees during the pandemic[23]. - As of December 29, 2021, trade accounts receivable from franchisees included $0.6 million related to fee deferrals from fiscal 2020[23]. - The total number of company restaurants at the end of the period was 65, unchanged from the previous year, while franchised and licensed restaurants decreased to 1,575 from 1,585[22]. Workforce and Diversity - As of December 29, 2021, Denny's employed approximately 3,300 individuals, with around 3,000 working in company-owned restaurants and 300 in corporate roles[38]. - 75% of Denny's total workforce and 80% of restaurant management are from diverse backgrounds, with 58% of restaurants owned by diverse franchisees[38]. - Denny's has established six business resource leadership groups to enhance inclusivity and support professional development among employees[38]. Technology and Innovation - Denny's has invested in technology to enhance operations and guest experience, including a cloud-based ERP platform for financial and operational management[56]. - The company has a robust digital ordering platform, Denny's on Demand, which allows guests to order food for takeout or delivery through a mobile app[44]. - The company has enhanced its technology infrastructure in response to the COVID-19 pandemic, focusing on digital and in-restaurant systems[58]. - The company has implemented cybersecurity measures to protect against unauthorized access and data loss, maintaining PCI Data Security Standard compliance[57]. - The company employs integrated marketing strategies to promote its brand and menu offerings, utilizing various advertising channels[52]. Compliance and Regulations - The company is subject to various regulations affecting restaurant operations, including health, safety, and labor standards[68]. - The company is in material compliance with applicable laws and regulations, but future regulatory changes may impact operations[76].