denn-20250326

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 26, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to ________________

Commission File Number 0-18051

DENNY’S CORPORATION

(Exact name of registrant as specified in its charter)


Delaware		13-3487402
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

203 East Main Street
Spartanburg,	South Carolina	29319-0001
(Address of principal executive offices)		(Zip Code)

(864) 597-8000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

$.01 Par Value, Common Stock

DENN

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

☐

Accelerated Filer

Non-Accelerated Filer

☐

Smaller Reporting Company

☐

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. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ý

As of April 30, 2025, 51,251,066 shares of the registrant’s common stock, par value $0.01 per share, were outstanding.

TABLE OF CONTENTS


			Page
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets			3
Consolidated Statements of Income			4
Consolidated Statements of Comprehensive Income (Loss)			5
Consolidated Statements of Shareholders' Deficit			6
Consolidated Statements of Cash Flows			7
Notes to Consolidated Financial Statements			8
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3. Quantitative and Qualitative Disclosures About Market Risk			29
Item 4. Controls and Procedures			30

PART II - OTHER INFORMATION

Item 1. Legal Proceedings			30
Item 1A. Risk Factors			30
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			31
Item 5. Other Information			31
Item 6. Exhibits			32
Signatures			33

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Denny’s Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)


	March 26, 2025		December 25, 2024
	(In thousands, except per share amounts)
Assets
Current assets:
Cash and cash equivalents	$	1,039	$	1,698
Investments	1,129		1,106
Receivables, net	17,197		24,433
Inventories	1,876		1,747
Assets held for sale	210		381
Prepaid and other current assets	10,383		10,628
Total current assets	31,834		39,993
Property, net of accumulated depreciation of $161,729 and $159,588, respectively	114,918		111,417
Finance lease right-of-use assets, net of accumulated amortization of $6,599 and $6,783, respectively	5,874		6,200
Operating lease right-of-use assets, net	126,834		124,738
Goodwill	66,357		66,357
Intangible assets, net	89,394		91,739
Deferred financing costs, net	907		1,066

Other noncurrent assets	51,957		54,764
Total assets	$	488,075	$	496,274
Liabilities
Current liabilities:
Current finance lease liabilities	$	1,253	$	1,284
Current operating lease liabilities	16,177		15,487
Accounts payable	16,731		19,985
Other current liabilities	52,145		58,842
Total current liabilities	86,306		95,598
Long-term liabilities:
Long-term debt	266,000		261,300
Noncurrent finance lease liabilities	8,960		9,284
Noncurrent operating lease liabilities	123,056		120,841
Liability for insurance claims, less current portion	5,926		5,866
Deferred income taxes, net	7,683		9,964
Other noncurrent liabilities	26,564		27,446
Total long-term liabilities	438,189		434,701
Total liabilities	524,495		530,299
Shareholders' deficit
Common stock $0.01 par value; 135,000 shares authorized; March 26, 2025: 51,649 shares issued and 51,431 outstanding; December 25, 2024: 51,329 shares issued and outstanding	$	516	$	513
Paid-in capital	1,566		—
Deficit	(2,173)		(2,499)
Accumulated other comprehensive loss, net	(35,348)		(32,039)
Treasury stock, at cost, 218 and 0 shares, respectively	(981)		—
Total shareholders' deficit	(36,420)		(34,025)
Total liabilities and shareholders' deficit	$	488,075	$	496,274

See accompanying notes

Denny’s Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)


	Quarter Ended
		March 26, 2025		March 27, 2024
		(In thousands, except per share amounts)
Revenue:
Company restaurant sales		$	53,900	$	52,342
Franchise and license revenue		57,737		57,632
Total operating revenue		111,637		109,974
Costs of company restaurant sales, excluding depreciation and amortization:
Product costs		14,211		13,311
Payroll and benefits		21,096		20,474
Occupancy		5,059		4,573
Other operating expenses		9,659		9,760
Total costs of company restaurant sales, excluding depreciation and amortization		50,025		48,118
Costs of franchise and license revenue, excluding depreciation and amortization		28,354		27,374
General and administrative expenses		20,030		21,222
Depreciation and amortization		4,107		3,581

Operating (gains), losses and other charges, net		3,911		(327)
Total operating costs and expenses, net		106,427		99,968
Operating income		5,210		10,006
Interest expense, net		4,428		4,420
Other nonoperating expense (income), net		162		(637)
Income before income taxes		620		6,223
Provision for income taxes		294		1,532
Net income		$	326	$	4,691

Net income per share - basic		$	0.01	$	0.09
Net income per share - diluted		$	0.01	$	0.09

Basic weighted average shares outstanding		52,324		53,068
Diluted weighted average shares outstanding		52,443		53,214

See accompanying notes

Denny’s Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)


	Quarter Ended
		March 26, 2025		March 27, 2024
		(In thousands)
Net income		$	326	$	4,691
Other comprehensive income (loss), net of tax:
Minimum pension liability adjustment, net of tax of $3 and $6, respectively		8		10
Changes in the fair value of cash flow hedges, net of tax of $(912) and $2,423, respectively		(2,707)		7,175
Reclassification of cash flow hedges to interest expense, net of tax of $(271) and $(381), respectively		(804)		(1,127)

Amortization of unrealized losses related to interest rate swaps to interest expense, net of tax of $65 and $36, respectively		194		106
Other comprehensive income (loss)		(3,309)		6,164
Total comprehensive income (loss)		$	(2,983)	$	10,855

See accompanying notes

Denny’s Corporation and Subsidiaries

Consolidated Statements of Shareholders’ Deficit

For the Quarters Ended March 26, 2025 and March 27, 2024

(Unaudited)

Common Stock

Treasury Stock

Paid-in Capital

Deficit

Accumulated
Other
Comprehensive Loss, Net

Total
Shareholders’
Deficit

Amount

(In thousands)

Balance, December 25, 2024

51,329

513

SEC Form 10-Q filed by Denny's Corporation