Portillos Inc

Previous wording

As of June 30, 2024, we owned and operated 86 Portillo’s restaurants across ten states, including a restaurant owned by C&O Chicago, L.L.C. ("C&O") of which Portillo’s owns 50% of the equity.

Current wording

As of September 29, 2024, we owned and operated 88 Portillo’s restaurants across ten states, including a restaurant owned by C&O Chicago, L.L.C. ("C&O") of which Portillo’s owns 50% of the equity.

Previous wording

•Total revenue increased 6.9% or $22.5 million to $347.7 million;

Current wording

•Total revenue increased 6.9% or $11.4 million to $178.3 million;

Previous wording

•Adjusted EBITDA** increased $0.6 million to $29.9 million.

Current wording

•Adjusted EBITDA** increased $0.6 million to $27.9 million.

Previous wording

Financial Highlights for the Two Quarters Ended June 30, 2024 vs. Two Quarters Ended June 25, 2023:

Current wording

Financial Highlights for the Three Quarters Ended September 29, 2024 vs. Three Quarters Ended September 24, 2023:

Previous wording

•Restaurant-Level Adjusted EBITDA** increased $3.4 million to $80.9 million; and

Current wording

•Adjusted EBITDA** increased $3.4 million to $79.6 million.

Previous wording

*For the quarter ended June 30, 2024, same-restaurant sales compares the 13 weeks from April 1, 2024 through June 30, 2024 to the 13 weeks from April 3, 2023 through July 2, 2023. For the two quarters ended June 30, 2024, same-restaurant sales compares the 26 weeks from January 1, 2024 through June 30, 2024 to the 26 weeks from January 2, 2023 through July 2, 2023.

Current wording

*For the quarter ended September 29, 2024, same-restaurant sales compares the 13 weeks from July 1, 2024 through September 29, 2024 to the 13 weeks from July 3, 2023 through October 1, 2023. For the three quarters ended September 29, 2024, same-restaurant sales compares the 39 weeks from January 1, 2024 through September 29, 2024 to the 39 weeks from January 2, 2023 through October 1, 2023.

Previous wording

In the quarter and two quarters ended June 30, 2024, total revenue grew 7.5% or $12.7 million and 6.9% or $22.5 million, respectively, primarily due to new restaurant openings in 2023 and 2024. Same-restaurant sales declined 0.6% during the quarter ended June 30, 2024, compared to 5.9% same-restaurant sales growth during the same quarter in 2023. Same-restaurant sales declined 0.9% during the two quarters ended June 30, 2024, compared to 7.4% same-restaurant sales growth during the two quarters ended June 25, 2023. Refer to "Selected Operating Data" section below for definition of Same-Restaurant Sales.

Current wording

In the quarter and three quarters ended September 29, 2024, total revenue grew 6.9% or $11.4 million and 6.9% or $33.9 million, respectively, primarily due to new restaurant openings in 2023 and 2024. Same-restaurant sales declined 0.9% during the quarter ended September 29, 2024, compared to 3.9% same-restaurant sales growth during the same quarter in 2023. Same-restaurant sales declined 0.9% during the three quarters ended September 29, 2024, compared to 6.1% same-restaurant sales growth during the three quarters ended September 24, 2023. Refer to "Selected Operating Data" section below for definition of Same-Restaurant Sales.

Previous wording

In the quarter and two quarters ended June 30, 2024, commodity inflation was 6.9% and 5.9%, respectively, compared to 5.5% and 7.1% for the quarter and two quarters ended June 25, 2023. Labor, as a percentage of revenue, net was flat during the quarter ended June 30, 2024 compared to the quarter ended June 25, 2023 primarily due to an increase in our average check and lower variable-based compensation, offset by lower transactions and incremental wage rate increases to support our team members. For the two quarters ended June 30, 2024, labor as a percent of revenues, net increased 0.1% compared to the two quarters ended June 25, 2023, primarily due to lower transactions and incremental wage rate increases, partially offset by an increase in our average check and lower variable-based compensation.

Current wording

In the quarter and three quarters ended September 29, 2024, commodity inflation was 3.6% and 5.1%, respectively, compared to 3.5% and 5.8% for the quarter and three quarters ended September 24, 2023, respectively. Labor, as a percentage of revenue, net increased 0.3% and 0.2% during the quarter and three quarters ended September 29, 2024, respectively, compared to the quarter and three quarters ended September 24, 2023, primarily due to lower transactions and incremental wage rate increases, partially offset by an increase in our average check. For the full year 2024, we expect to achieve negative comparable sales of approximately 1.0% and restaurant-level margins between 23% and 24%.

Previous wording

In the quarter and two quarters ended June 30, 2024, total revenue, operating income, Restaurant-Level Adjusted EBITDA, and Adjusted EBITDA all improved, while net income decreased, versus the prior year. We believe this improvement stemmed from concentrating on the four strategic pillars previously mentioned. For the full year 2024, we expect to achieve flat to slightly positive comparable sales and restaurant-level margins between 23% and 24%.

Current wording

In the quarter and three quarters ended September 29, 2024, total revenue, operating income, net income, Restaurant-Level Adjusted EBITDA, and Adjusted EBITDA all improved versus the prior year. We believe this improvement stemmed from maintaining concentration on our four strategic pillars, which guide our short-term objectives and form the basis for long-term growth:

Previous wording

During the two quarters ended June 30, 2024, we opened two restaurants in the Texas and Arizona markets. Subsequent to June 30, 2024, we opened two additional restaurants, bringing our total restaurant count to 88, including a restaurant owned by C&O of which Portillo’s owns 50% of the equity. In the second half of 2024 we aim to open at least six more restaurants for a total of at least 10 new restaurants opened in the fiscal year 2024, including further expansion into the Houston and Dallas-Fort Worth markets in Texas.

Current wording

During the three quarters ended September 29, 2024, we opened four new restaurants. Subsequent to September 29, 2024, we opened one additional restaurant, bringing our total restaurant count to 89, as of the filing of this Quarterly Report on Form 10-Q, including a restaurant owned by C&O of which Portillo’s owns 50% of the equity. We plan to open five more restaurants, all in December, for a total of 10 new restaurants opened in the fiscal year 2024, including further expansion into the Houston and Dallas-Fort Worth markets in Texas.

Previous wording

The following table summarizes our results of operations for the quarter and two quarters ended June 30, 2024 and June 25, 2023 (in thousands):

Current wording

The following table summarizes our results of operations for the quarter and three quarters ended September 29, 2024 and September 24, 2023 (in thousands):

Previous wording

Revenues for the quarter ended June 30, 2024 were $181.9 million compared to $169.2 million for the quarter ended June 25, 2023, an increase of $12.7 million or 7.5%. The increase in revenues was primarily attributed to the opening of nine restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024, partially offset by a decrease in our same-restaurant sales. Restaurants not in our comparable restaurant base contributed $12.6 million of the total year-over- year increase. This increase in revenues was offset by a same-restaurant sales decrease of 0.6%, or $1.0 million in the quarter. The same-restaurant sales decline was attributable to a 2.3% decrease in transactions, partially offset by an increase in average check of 1.7%. The higher average check was driven by an approximate 4.3% increase in certain menu prices partially offset by product mix. To address inflationary cost pressures, we increased select menu prices by approximately 1.5% in January 2024 and again at the end of March 2024. In June 2024, we implemented a 1% price increase primarily by re-tiering some of our restaurants in higher-cost areas. Revenue also benefited $1.2 million in the second quarter due to the shifting of comparable weeks. For the purpose of calculating same-restaurant sales for the quarter ended June 30, 2024, sales for 70 restaurants that were open for at least 24 full fiscal periods were included in the Comparable Restaurant Base (as defined in "Selected Operating Data" below).

Current wording

Revenues for the quarter ended September 29, 2024 were $178.3 million compared to $166.8 million for the quarter ended September 24, 2023, an increase of $11.4 million or 6.9%. The increase in revenues was primarily attributed to the opening of eight restaurants in the third and fourth quarters of 2023 and four restaurants during the three quarters ended September 29, 2024, partially offset by a decrease in our same-restaurant sales. Restaurants not in our Comparable Restaurant Base contributed $13.6 million of the total year-over-year increase. This increase in revenues was offset by a same-restaurant sales decrease of 0.9%, or $1.4 million in the quarter. The same-restaurant sales decline was attributable to a 3.5% decrease in transactions, partially offset by an increase in average check of 2.6%. The higher average check was driven by an approximate 4.4% increase in certain menu prices partially offset by product mix. To address inflationary cost pressures, we increased select menu prices by approximately 1.5% in January 2024 and again at the end of March 2024. In June 2024, we implemented a 1% price increase primarily by re-tiering some of our restaurants in higher-cost areas. Revenue was negatively impacted by $1.0 million in the third quarter due to the shifting of comparable weeks. For the purpose of calculating same-restaurant sales for the quarter ended September 29, 2024, sales for 70 restaurants that were open for at least 24 full fiscal periods were included in the Comparable Restaurant Base (as defined in "Selected Operating Data" below).

Previous wording

Revenues for the two quarters ended June 30, 2024 were $347.7 million compared to $325.2 million for the two quarters ended June 25, 2023, an increase of $22.5 million or 6.9%. The increase in revenues was primarily attributed to the opening of twelve restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024, partially offset by a decrease in our same-restaurant sales. Restaurants not in our comparable restaurant base contributed $26.5 million of the total year-over-year increase. This increase in revenues was offset by a same-restaurant sales decrease of 0.9%, or $2.6 million in the quarter. The same-restaurant sales decline was attributable to a 2.7% decrease in transactions, partially offset by an increase in average check of 1.8%. The higher average check was primarily driven by an approximate 4.7% increase in menu prices partially offset by product mix. To address inflationary cost pressures, we increased select menu prices by approximately 1.5% in January 2024 and again at the end of March 2024. In June 2024, we implemented a 1% price increase primarily by re-tiering some of our restaurants in higher-cost areas. Revenue was negatively impacted by $0.8 million in the second quarter due to the shifting of comparable weeks. For the purpose of calculating same-restaurant sales for the two quarters ended June 30, 2024, sales for 70 restaurants that were open for at least 24 full fiscal periods were included in the Comparable Restaurant Base.

Current wording

Revenues for the three quarters ended September 29, 2024 were $525.9 million compared to $492.0 million for the three quarters ended September 24, 2023, an increase of $33.9 million or 6.9%. The increase in revenues was primarily attributed to the opening of twelve restaurants in 2023 and four restaurants during the three quarters ended September 29, 2024, partially offset by a decrease in our same-restaurant sales. Restaurants not in our Comparable Restaurant Base contributed $40.2 million of the total year-over-year increase. This increase in revenues was offset by a same-restaurant sales decrease of 0.9%, or $4.0 million. The same-restaurant sales decline was attributable to a 3.0% decrease in transactions, partially offset by an increase in average check of 2.1%. The higher average check was primarily driven by an approximate 4.6% increase in menu prices partially offset by product mix. To address inflationary cost pressures, we increased select menu prices by approximately 1.5% in January 2024 and again at the end of March 2024. In June 2024, we implemented a 1% price increase primarily by re-tiering some of our restaurants in higher-cost areas. Revenue was negatively impacted by $1.8 million in the third quarter due to the shifting of comparable weeks. For the purpose of calculating same-restaurant sales for the three quarters ended September 29, 2024, sales for 70 restaurants that were open for at least 24 full fiscal periods were included in the Comparable Restaurant Base.

Previous wording

The following table summarizes the Company's revenue for the two quarters ended June 30, 2024 and June 25, 2023 (in thousands):

Current wording

The following table summarizes the Company's revenue for the three quarters ended September 29, 2024 and September 24, 2023 (in thousands):

Previous wording

(1) We use a 52- or 53-week fiscal year ending on the Sunday on or prior to December 31. Fiscal 2024 consists of 52 weeks and fiscal 2023 consisted of 53 weeks. In order to compare like-for-like periods for the for the two quarters ended June 30, 2024, same-restaurant sales compares the 26 weeks from January 1, 2024 through June 30, 2024 to the 26 weeks from January 2, 2023 through July 2, 2023.

Current wording

(1) We use a 52- or 53-week fiscal year ending on the Sunday on or prior to December 31. Fiscal 2024 consists of 52 weeks and fiscal 2023 consisted of 53 weeks. In order to compare like-for-like periods for the three quarters ended September 29, 2024, same-restaurant sales compares the 39 weeks from January 1, 2024 through September 29, 2024 to the 39 weeks from January 2, 2023 through October 1, 2023.

Previous wording

(2) Represents the impact from shifting comparable weeks for all periods in fiscal 2023 to compare like-for-like periods. For the two quarters ended June 25, 2023, same-restaurant sales includes sales from the 26 weeks from January 2, 2023 through July 2, 2023 rather than the 13 weeks from December 26, 2022 through June 25, 2023.

Current wording

(2) Represents the impact from shifting comparable weeks for all periods in fiscal 2023 to compare like-for-like periods. For the three quarters ended September 24, 2023, same-restaurant sales includes sales from the 39 weeks from January 2, 2023 through October 1, 2023 rather than the 39 weeks from December 26, 2022 through September 24, 2023.

Previous wording

Food, beverage and packaging costs for the quarter ended June 30, 2024 were $61.7 million compared to $56.2 million for the quarter ended June 25, 2023, an increase of $5.5 million or 9.8%. This increase was primarily driven by the opening of nine restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024 and a 6.9% increase in commodity prices. As a percentage of revenues, net, food, beverage and packaging costs increased 0.7% during the quarter ended June 30, 2024. The increase was primarily due to an increase in certain commodity prices, partially offset by an increase in average check.

Current wording

Food, beverage and packaging costs for the quarter ended September 29, 2024 were $60.1 million compared to $55.6 million for the quarter ended September 24, 2023, an increase of $4.6 million or 8.3%. This increase was primarily driven by the opening of eight restaurants in the third and fourth quarters of 2023 and four restaurants during the three quarters ended September 29, 2024 and a 3.6% increase in commodity prices. As a percentage of revenues, net, food, beverage and packaging costs increased 0.4% during the quarter ended September 29, 2024. The increase was primarily due to an increase in certain commodity prices, partially offset by an increase in average check.

Previous wording

Food, beverage and packaging costs for the two quarters ended June 30, 2024 was $118.7 million compared to $109.9 million for the two quarters ended June 25, 2023, an increase of $8.8 million or 8.0%. This increase was primarily driven by the opening of twelve restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024 and a 5.9% increase in commodity prices, partially offset by lower third-party delivery commissions. As a percentage of revenues, net, food, beverage and packaging costs increased 0.3% during the two quarters ended June 30, 2024. The increase was primarily due to an increase in certain commodity prices, partially offset by an increase in average check and lower third-party delivery commissions.

Current wording

Food, beverage and packaging costs for the three quarters ended September 29, 2024 was $178.8 million compared to $165.4 million for the three quarters ended September 24, 2023, an increase of $13.4 million or 8.1%. This increase was primarily driven by the opening of twelve restaurants in 2023 and four restaurants during the three quarters ended September 29, 2024 and a 5.1% increase in commodity prices, partially offset by lower third-party delivery commissions. As a percentage of revenues, net, food, beverage and packaging costs increased 0.4% during the three quarters ended September 29, 2024. The increase was primarily due to an increase in certain commodity prices, partially offset by an increase in average check and lower third-party delivery commissions.

Previous wording

Labor expenses for the quarter ended June 30, 2024 were $46.4 million compared to $43.2 million for the quarter ended June 25, 2023, an increase of $3.3 million or 7.6%. This increase was primarily driven by the opening of nine restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024 and incremental investments to support our team members, partially offset by lower variable-based compensation. As a percentage of revenues, net, labor was flat primarily due to an increase in our average check and lower variable-based compensation, offset by lower transactions and incremental wage rate increases.

Current wording

Labor expenses for the quarter ended September 29, 2024 were $45.9 million compared to $42.6 million for the quarter ended September 24, 2023, an increase of $3.4 million or 7.9%. This increase was primarily driven by the opening of eight restaurants in the third and fourth quarters of 2023 and four restaurants during the three quarters ended September 29, 2024 and incremental investments to support our team members, partially offset by lower variable-based compensation. As a percentage of revenues, net, labor increased 0.3% primarily due to lower transactions, incremental wage rate investments and an increase in benefit expenses, partially offset by an increase in our average check.

Previous wording

Labor expenses for the two quarters ended June 30, 2024 were $89.7 million compared to $83.6 million for the two quarters ended June 25, 2023, an increase of $6.1 million or 7.3%. This increase was primarily driven by the opening of twelve restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024 and incremental investments to support our team members, partially offset by lower variable-based compensation. As a percentage of revenues, net, labor increased 0.1% primarily due to lower transactions and incremental wage rate increases, partially offset by an increase in our average check and lower variable-based compensation.

Current wording

Labor expenses for the three quarters ended September 29, 2024 were $135.7 million compared to $126.2 million for the three quarters ended September 24, 2023, an increase of $9.5 million or 7.5%. This increase was primarily driven by the opening of twelve restaurants in 2023 and four restaurants during the three quarters ended September 29, 2024 and incremental investments to support our team members, partially offset by lower variable-based compensation. As a percentage of revenues, net, labor increased 0.2% primarily due to lower transactions and incremental wage rate investments, partially offset by an increase in our average check and lower variable-based compensation.

Previous wording

Occupancy expenses for the quarter ended June 30, 2024 were $9.2 million compared to $8.2 million for the quarter ended June 25, 2023, an increase of $1.0 million or 11.8%, primarily driven by the opening of nine restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024. As a percentage of revenues, net, occupancy expenses increased 0.2%.

Current wording

Occupancy expenses for the quarter ended September 29, 2024 were $9.2 million compared to $8.2 million for the quarter ended September 24, 2023, an increase of $1.0 million or 11.7%, primarily driven by the opening of eight restaurants in the third and fourth quarters of 2023 and four restaurants during the three quarters ended September 29, 2024. As a percentage of revenues, net, occupancy expenses increased 0.2%.

Previous wording

Occupancy expenses for the two quarters ended June 30, 2024 were $18.6 million compared to $16.7 million for the two quarters ended June 25, 2023, an increase of $1.9 million or 11.2%, primarily driven by the opening of twelve restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024. As a percentage of revenues, net, occupancy expenses increased 0.2%.

Current wording

Occupancy expenses for the three quarters ended September 29, 2024 were $27.7 million compared to $24.9 million for the three quarters ended September 24, 2023, an increase of $2.8 million or 11.3%, primarily driven by the opening of twelve restaurants in 2023 and four restaurants during the three quarters ended September 29, 2024. As a percentage of revenues, net, occupancy expenses increased 0.2%.

Previous wording

Other operating expenses for the quarter ended June 30, 2024 were $20.0 million compared to $18.8 million for the quarter ended June 25, 2023, an increase of $1.1 million or 6.0%, primarily due to the opening of nine restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024, partially offset by a decrease in utilities, travel and other miscellaneous expenses. As a percentage of revenues, net, operating expenses decreased 0.1%.

Current wording

September 24, 2023, an increase of $2.5 million or 13.4%, primarily due to the opening of eight restaurants in the third and fourth quarters of 2023 and four restaurants during the three quarters ended September 29, 2024, and an increase in repairs and maintenance, partially offset by a decrease in insurance expenses. As a percentage of revenues, net, operating expenses increased 0.7%.

Previous wording

Other operating expenses for the two quarters ended June 30, 2024 were $39.8 million compared to $37.5 million for the two quarters ended June 25, 2023, an increase of $2.3 million or 6.1%, primarily due to the opening of twelve restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024, partially offset by a decrease in travel, operating supplies, and other miscellaneous expenses. As a percentage of revenues, net, operating expenses was consistent with the comparable prior period.

Current wording

Other operating expenses for the three quarters ended September 29, 2024 were $60.9 million compared to $56.1 million for the three quarters ended September 24, 2023, an increase of $4.8 million or 8.5%, primarily due to the opening of twelve restaurants in 2023 and four restaurants during the three quarters ended September 29, 2024, and an increase in repairs and maintenance and credit card fees, partially offset by a decrease in operating supplies, and other miscellaneous expenses. As a percentage of revenues, net, operating expenses increased 0.2%.

Previous wording

General and administrative expenses for the two quarters ended June 30, 2024 were $36.5 million compared to $38.4 million for the two quarters ended June 25, 2023, a decrease of $1.9 million or 5.0%. This decrease was primarily driven by lower equity and variable-based compensation, partially offset by an increase in professional fees related to our ERP implementation, and advertising expenses.

Current wording

General and administrative expenses for the three quarters ended September 29, 2024 were $54.8 million compared to $57.3 million for the three quarters ended September 24, 2023, a decrease of $2.5 million or 4.4%. This decrease was primarily driven by lower equity and variable-based compensation and insurance expenses, partially offset by an increase in advertising expenses, professional fees and software license fees related to our ERP implementation and travel.

Previous wording

Pre-opening expenses for the quarter ended June 30, 2024 were $2.1 million compared to $0.3 million for the quarter ended June 25, 2023, an increase of $1.8 million or 663.6%. The increase was due to the number and timing of activities related to our planned restaurant openings for the quarter ended June 30, 2024 as compared to the quarter ended June 25, 2023.

Current wording

Pre-opening expenses for the quarter ended September 29, 2024 were $1.7 million compared to $2.4 million for the quarter ended September 24, 2023, an decrease of $0.7 million or 27.5%. The decrease was due to the number and timing of activities related to our planned restaurant openings for the quarter ended September 29, 2024 as compared to the quarter ended September 24, 2023.

Previous wording

Pre-opening expenses for the two quarters ended June 30, 2024 were $3.5 million compared to $2.6 million for the two quarters ended June 25, 2023, an increase of $0.9 million or 34.5%. This increase was due to the number and timing of activities related to our planned restaurant openings for the two quarters ended June 30, 2024 as compared to the two quarters ended June 25, 2023.

Current wording

Pre-opening expenses for the three quarters ended September 29, 2024 were $5.3 million compared to $5.0 million for the three quarters ended September 24, 2023, an increase of $0.2 million or 4.8%. This increase was due to the number and timing of activities related to our planned restaurant openings for the three quarters ended September 29, 2024 as compared to the three quarters ended September 24, 2023.

Previous wording

Depreciation and amortization expense for the quarter ended June 30, 2024 was $7.1 million compared to $5.9 million for the quarter ended June 25, 2023, an increase of $1.2 million or 19.6%. This increase was primarily attributable to incremental depreciation of capital expenditures related to the opening of nine restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024.

Current wording

Depreciation and amortization expense for the quarter ended September 29, 2024 was $6.7 million compared to $6.2 million for the quarter ended September 24, 2023, an increase of $0.5 million or 8.1%. This increase was primarily attributable to incremental depreciation of capital expenditures related to the opening of eight restaurants in the third and fourth quarters of 2023 and four restaurants during the three quarters ended September 29, 2024.

Previous wording

Depreciation and amortization expense for the two quarters ended June 30, 2024 was $14.1 million compared to $11.6 million for the two quarters ended June 25, 2023, an increase of $2.4 million or 21.0%. This increase was primarily attributable to incremental depreciation of capital expenditures related to the opening of twelve restaurants in 2023 and two restaurants during the two quarters ended June 30, 2024.

Current wording

Depreciation and amortization expense for the three quarters ended September 29, 2024 was $20.7 million compared to $17.8 million for the three quarters ended September 24, 2023, an increase of $2.9 million or 16.5%. This increase was primarily attributable to incremental depreciation of capital expenditures related to the opening of twelve restaurants in 2023 and four restaurants during the three quarters ended September 29, 2024.

Previous wording

Net income attributable to equity method investment for the two quarters ended June 30, 2024 was $0.5 million compared to $0.6 million for the two quarters ended June 25, 2023, a decrease of $0.05 million or 8.2%. This decrease was primarily driven by an increase in restaurant-level operating expenses, partially offset by an increase in sales.

Current wording

Net income attributable to equity method investment for the three quarters ended September 29, 2024 was $0.9 million compared to $1.0 million for the three quarters ended September 24, 2023, a decrease of $0.1 million or 8.6%. This decrease was primarily driven by an increase in restaurant-level operating expenses, partially offset by an increase in sales.

Previous wording

Other income, net, for the quarter ended June 30, 2024 was $0.4 million compared to $0.1 million for the quarter ended June 25, 2023, an increase of $0.3 million or 269.1%. This increase was primarily due to a gain on sale of assets, partially offset by a decrease in trading gains in the rabbi trust used to fund our deferred compensation plan.

Current wording

Other income, net, for the quarter ended September 29, 2024 was $0.4 million compared to $0.3 million for the quarter ended September 24, 2023, an increase of $0.1 million or 41.3%. This increase was primarily due to higher trading gains in the rabbi trust used to fund our deferred compensation plan.

Previous wording

Other income, net, for the two quarters ended June 30, 2024 was $0.8 million compared to $0.4 million for the two quarters ended June 25, 2023, an increase of $0.4 million or 122.0%. This increase was primarily due to a decrease in loss on sale of assets, partially offset by a decrease in trading gains in the rabbi trust used to fund our deferred compensation plan.

Current wording

Other income, net, for the three quarters ended September 29, 2024 was $1.2 million compared to $0.6 million for the three quarters ended September 24, 2023, an increase of $0.5 million or 86.7%. This increase was primarily due to a decrease in loss on sale of assets and higher trading gains in the rabbi trust used to fund our deferred compensation plan.

Previous wording

Interest expense for the two quarters ended June 30, 2024 was $13.1 million compared to $14.0 million for the two quarters ended June 25, 2023, a decrease of $0.8 million or 6.0%. This decrease was primarily driven by the improved lending terms associated with our 2023 Term Loan and 2023 Revolver Facility.

Current wording

Interest expense for the three quarters ended September 29, 2024 was $19.6 million compared to $20.5 million for the three quarters ended September 24, 2023, a decrease of $1.0 million or 4.7%. This decrease was primarily driven by a lower effective interest rate and the improved lending terms associated with our 2023 Term Loan and 2023 Revolver Facility.

Previous wording

Our effective interest rate on the 2023 Term Loan and 2023 Revolver Facility was 8.31% and 8.16% as of June 30, 2024 and June 25, 2023, respectively.

Current wording

Our effective interest rate on the 2023 Term Loan and 2023 Revolver Facility was 8.32% and 8.50% as of September 29, 2024 and September 24, 2023, respectively.

Previous wording

We are party to a Tax Receivable Agreement liability with certain members of Portillo's OpCo that provides for the payment by us of 85% of the amount of tax benefits, if any, that Portillo's Inc. actually realizes or in some cases is deemed to realize as a result of certain transactions.

Current wording

We are party to a Tax Receivable Agreement liability with certain members of PHD Group Holdings LLC and its subsidiaries ("Portillo's OpCo”) that provides for the payment by us of 85% of the amount of tax benefits, if any, that Portillo's Inc. actually realizes or in some cases is deemed to realize as a result of certain transactions.

Previous wording

The tax receivable agreement liability adjustment was $0.4 million for the quarter ended June 30, 2024 and $1.0 million for the two quarters ended June 30, 2024 related to a remeasurement primarily due to activity under equity-based compensation plans. The tax receivable agreement liability adjustment was $0.6 million and $1.2 million for the quarter and two quarters ended June 25, 2023, respectively.

Current wording

The Tax Receivable Agreement liability adjustment was $1.7 million for the quarter ended September 29, 2024 and $2.7 million for the three quarters ended September 29, 2024 related to a remeasurement primarily due to activity under equity-based compensation plans. The Tax Receivable Agreement liability adjustment was $0.5 million and $1.7 million for the quarter and three quarters ended September 24, 2023, respectively.

Previous wording

There was no loss on debt extinguishment for the quarter and two quarters ended June 30, 2024 and quarter ended June 25, 2023. Loss on debt extinguishment for the two quarters ended June 25, 2023 was $3.5 million due to the write-off of debt discount and deferred issuance costs associated with the payoff of the 2014 Credit Agreement as described in Note 8. Debt.

Current wording

There was no loss on debt extinguishment for the quarter and three quarters ended September 29, 2024 and quarter ended September 24, 2023. Loss on debt extinguishment for the three quarters ended September 24, 2023 was $3.5 million due to the write-off of debt discount and deferred issuance costs associated with the payoff of the 2014 Credit Agreement as described in Note 8. Debt.

Previous wording

Income tax expense for the quarter ended June 30, 2024 was $3.5 million compared to $1.5 million for the quarter ended June 25, 2023, an increase of $2.0 million or 126.7%. Our effective income tax rate for the quarter ended June 30, 2024 was 29.1%, compared to 13.5% for the quarter ended June 25, 2023. The increase in our effective income tax rate for the quarter ended June 30, 2024 compared to the quarter ended June 25, 2023 was primarily driven by an increase in the Company's ownership interest in Portillo's OpCo, which increases its share of taxable income (loss) of Portillo's OpCo, and recording of net operating loss carryforwards in the prior year.

Current wording

Income tax expense for the quarter ended September 29, 2024 was $2.5 million compared to $2.6 million for the quarter ended September 24, 2023, a decrease of $0.1 million or 3.2%. Our effective income tax rate for the quarter ended September 29, 2024 was 22.4%, compared to 28.6% for the quarter ended September 24, 2023. The decrease in our effective income tax rate for the quarter ended September 29, 2024 compared to the quarter ended September 24, 2023 was primarily driven by return to provision adjustments, partially offset by an increase in the company's ownership interest in Portillo's OpCo, which increases its share of taxable income (loss) of Portillo's OpCo.

Previous wording

Income tax expense for the two quarters ended June 30, 2024 was $2.4 million compared to income tax expense of $1.0 million for the two quarters ended June 25, 2023, an increase of $1.4 million or 140.0%. Our effective income tax rate for the two quarters ended June 30, 2024 was 14.5%, compared to 10.2% for the two quarters ended June 25, 2023. The increase in our effective income tax rate for the two quarters ended June 30, 2024 compared to the two quarters ended June 25, 2023 was driven by an increase in the Company's ownership interest in Portillo's OpCo, which increases its share of taxable income (loss) of Portillo's OpCo, and recording of net operating loss carryforwards in the prior year, partially offset by a decrease in the valuation allowance recorded against a portion of the Company's deferred tax assets as a result of the Secondary Offering.

Current wording

Income tax expense for the three quarters ended September 29, 2024 was $4.9 million compared to income tax expense of $3.6 million for the three quarters ended September 24, 2023, an increase of $1.3 million or 35.9%. Our effective income tax rate for the three quarters ended September 29, 2024 was 17.8%, compared to 19.2% for the three quarters ended September 24, 2023. The decrease in our effective income tax rate for the three quarters ended September 29, 2024 compared to the three quarters ended September 24, 2023 was primarily driven by a decrease in the valuation allowance recorded against a portion of the Company's deferred tax assets as a result of the secondary offering in Q1 2024 and return to provision adjustments, partially offset by an increase in the Company's ownership interest in Portillo's OpCo, which increases its share of taxable income (loss) of Portillo's OpCo.

Previous wording

Net income attributable to non-controlling interests for the quarter ended June 30, 2024 was $2.1 million, compared to net income attributable to non-controlling interests of $3.1 million for the quarter ended June 25, 2023, a decrease of $1.1 million or 33.8%. The decrease in net income attributable to non-controlling interests for the quarter ended June 30, 2024 was primarily due to a decrease in the non-controlling interest holders' weighted average ownership, from 24.2% for the quarter ended June 25, 2023 to 15.9% for the quarter ended June 30, 2024.

Current wording

Net income attributable to non-controlling interests for the quarter ended September 29, 2024 was $1.6 million, compared to net income attributable to non-controlling interests of $2.2 million for the quarter ended September 24, 2023, a decrease of $0.6 million or 28.9%. The decrease in net income attributable to non-controlling interests for the quarter ended September 29, 2024 was primarily due to a decrease in the non-controlling interest holders' weighted average ownership from 24.1% for the quarter ended September 24, 2023 to 15.8% for the quarter ended September 29, 2024, partially offset by an increase in net income for the quarter ended September 29, 2024 compared to the quarter ended September 24, 2023.