Chuy's Holdings Inc (CHUY) 2017 Q4 法說會逐字稿

Good day, everyone, and welcome to the Chuy's Holdings, Incorporated Fourth Quarter 2017 Earnings Call. As a reminder, today's conference is being recorded. (Operator Instructions)

On today's call, we have Steve Hislop, President and Chief Executive Officer; and Jon Howie, Vice President and Chief Financial Officer of Chuy's Holdings, Incorporated.

And at this time, I'll turn the conference over to Mr. Howie. Please go ahead, sir.

Thank you, operator, and good afternoon.

By now, everyone should have access to the fourth quarter 2017 earnings release. It can also be found on our website at www.chuys.com in the Investors section.

Before we begin our review of formal remarks, I need to remind everyone that part of our discussions today will include forward-looking statements. These forward-looking statements are not guarantees of future performance, and therefore, you should not put undue reliance on them. These statements are also subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. We refer all of you to our recent SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial conditions.

With that out of the way, I'd like to turn the call over to Steve.

Thank you, Jon, and thank you to everyone for joining us on the call today.

I'll start the call with a brief overview of our fourth quarter, discuss our 2018 initiatives, and then share our thoughts on development for the year. Jon will then review our fourth quarter financial results in more detail before we open up the call for your questions.

For the fourth quarter of 2017, we reported adjusted earnings per share of $0.19 off revenues of $96 million. As a reminder, our fiscal 2017 included an extra week in the fourth quarter of which Jon will provide additional color.

As we noted on our last call, in August, we had to close one restaurant in the Houston area due to severe damage as a result of Hurricane Harvey. Our team did a fantastic job in getting this restaurant back up and running in late November as it was literally taken down to the stubs. However, the loss of operations negatively impacted our fourth quarter results by approximately $0.01.

We were pleased to see our comparable restaurant sales return to positive territory during the fourth quarter, increasing 1.3% on a comparable 13-week basis. Comparable restaurant sales were positively impacted by approximately 100 basis points as a result of an extra operating week -- operating day in the comparable period of 2017, largely offset by unfavorable weather conditions and strategic cannibalization of approximately 85 basis points combined. We also faced a 70-basis point headwind as a result of the new units entering the comp base on the back end of their honeymoon curve.

As we look at -- as we look to 2018, our focus remains on our core fundamentals: taking care of our customers by offering exceptional service standards and delivering high-quality, made-from-scratch food and drinks in a unique and upbeat atmosphere. However, we are also working to ensure that our business evolves naturally with the changing consumer needs and wants. To that end, we are working on several strategic initiatives this year that we believe will help our business over the long run.

On the marketing front, we continue to look for ways to improve our brand awareness and value messaging through updated local store marketing and social media campaigns. We are currently in the process of engaging a full-time marketing firm to help bring our marketing efforts to a new level. We have [narrowed down] our options and are expecting to complete our search by the end of the second quarter.

Turning to our technology initiatives. We just finished system-wide implementation of our new point-of-sale software during the fourth quarter and are working closely with Olo to create a robust online ordering app and back-end system that will make it easier for our guests to conveniently order our food. This platform will ultimately be a stepping stone for the introduction of a new loyalty program. We are currently in the testing phase, with a plan to fully roll out this online ordering system by the third quarter of this year.

As we discussed on our last call, after offering limited catering in Nashville, we expanded a test to include catering in Dallas and Houston during the fourth quarter. Catering gives us an opportunity to utilize a new avenue of revenue growth while simultaneously improving awareness of the Chuy's brand. While it's still early, we are pleased with the initial results and we'll consider adding additional markets where appropriate as the year progresses.

Lastly, on our labor initiatives. With the implementation of our new point-of-sale system, we are now ready to fully integrate our labor scheduling module that should enhance our sales projections and further assist us in optimizing our labor productivity. We are on track to complete this integration in the second quarter and would expect to see labor cost improvements as our team gets familiar with the new system.

Switching to the development. We opened 4 new Chuy's restaurant during the first -- fourth quarter: 1 in Pasadena, Texas just outside Houston; 1 in Schaumburg, Illinois, our second restaurant in the Chicagoland area; 1 in Annapolis, Maryland, our second in Maryland and are the 6 overall in the Washington, D.C. metropolitan area; and 1 in Alpharetta, Georgia, our fourth restaurant in Atlanta. We also, as I mentioned before, reopened our restaurant in Humble, Texas late in the fourth quarter that had been closed since August as a result of hurricane damage.

Overall, we opened 11 new restaurants during 2017, effectively increasing our store base during 2017 by 14% to a total of 91 restaurants. For 2018, we continue to expect to open between 8 and 12 units.

In closing, with a healthy development pipeline, a renewed focus in marketing to increase brand awareness and our value messaging, and labor initiatives to improve our labor management in the face of rising labor costs, we look forward to a very busy and productive year in 2018.

With that, I'd like to turn the call over to our CFO, Jon Howie, for a more detailed review of our fourth quarter results.

Thanks, Steve.

Revenues increased 21.5% year-over-year to $96 million for the fourth quarter ended December 31, 2017. As Steve mentioned, our fourth quarter of 2017 included 14 weeks compared to 13 weeks in fiscal 2016. Revenue attributed to the extra operating week was $7.3 million. In addition to the extra operating week, the increase was driven by $22 million in incremental revenues from an additional 276 operating weeks produced by 14 new restaurants opened during and subsequent to the fourth quarter of last year. This increase was partially offset by $0.7 million decrease in revenue related to a temporary closure of 1 restaurant as a result of Hurricane Harvey as well as our non-comparable restaurants that are not included in the incremental revenue above.

Total operating weeks in the fourth quarter of 2017 increased to 1,242, including 91 additional weeks as a result of the 14th week during the quarter. Also contributing to our revenue growth during the fourth quarter was a 1.3% increase in comparable restaurant sales on a 13-week comparable basis. As Steve noted, comparable restaurant sales were positively impacted by 1 extra operating day in 2017 in that 52-week basis as a result of restaurants closing on Christmas Day during the fourth quarter of 2016. This 100-basis point benefit was largely offset by unfavorable weather conditions in Texas and the Southeast, and the impact of Houston Astros in this year's World Series negatively impacting comparable sales by approximately 40 basis points, and the strategic cannibalization of 2 restaurants in Austin that negatively impacted comparable sales by approximately 45 basis points.

The overall growth in comparable restaurant sales included a 1.6% increase in average check, offset by a 0.3% decrease in traffic. Effective pricing during the quarter was approximately 1.5%. There were 70 restaurants in our comparable base at the end of the fourth quarter of 2017.

Turning to a discussion of selected expense items. Cost of sales as a percentage of revenue increased approximately 30 basis points year-over-year to 26.4%, driven largely by inflation of 2.9% in commodities related to produce and, to a lesser degree, dairy, partially offset by favorable beef costs and, to a lesser degree, chicken cost.

Looking to 2018, we currently expect inflation in the 1% to 2% range, similar to 2017. We would expect higher inflation in the first of the year and lower later in the year.

Labor cost as a percentage of revenue increased approximately 110 basis points to 36.4%. The increase was attributable to hourly labor rate inflation, new store labor inefficiencies related to 2 additional store openings in the quarter as compared to last year, entering new markets with higher tip wage and manager training and due to delayed store openings. For 2018, we expect labor inflation to be approximately 3%.

Restaurant operating cost as a percentage of revenue decreased 70 basis points to 13.6%, primarily due to increased operating leverage from an extra week as well as an hourly health plan adjustment.

Occupancy cost as a percentage of revenue held steady year-over-year at 7%, primarily due to the leverage from the extra week, where would have expected this to be up approximately 20 basis points.

General and administrative expenses increased approximately $246,000 or $4.3 million in the fourth quarter, driven primarily by an increase in stock-based compensation, salaries and professional fees, offset by lower performance-based bonuses. As a percentage of revenue, G&A decreased approximately 70 basis points year-over-year to 4.4%.

In summary, net income for the fourth quarter of 2017 was $15.9 million or $0.93 per diluted share compared to $2.3 million or $0.14 per diluted share in the year-ago period.

During the fourth quarter of 2017, the federal government enacted the Tax Cuts and Jobs Act of 2017. This reduced the federal statutory rate from 35% to 21%. As a result of this change, we were required to revalue our deferred tax balance using the new federal statutory tax rate. This revaluation resulted in a nonrecurring, onetime favorable adjustment to our provision for income taxes in the fourth quarter of 2017 totaling $11.7 million or $0.69 per diluted share.

Additionally, we recorded a $1.4 million gain on interest settlements related to the hurricane. And for the same period last year, we incurred closure costs of $1.1 million pretax related to the 1 relocation of -- a relocation of 1 restaurant.

Excluding these onetime gains and charges, adjusted net income was $3.2 million or $0.19 per diluted share compared to $3.1 million or $0.18 per diluted share in the year-ago period. Our fourth quarter 2017 results included an estimated $0.07 per share of positive impact due to the extra week in the most recent fourth quarter.

Additionally, as Steve noted, loss of operations during the fourth quarter as a result of the hurricane-related closure of our Humble, Texas restaurant negatively impacted our fourth quarter results by approximately $0.01.

We ended the quarter with $8.8 million of cash on the balance sheet, and we currently have no debt. With that, let me go through our outlook for 2018.

We currently expect 2018 diluted earnings per share of 1 12 -- $1.12 to $1.16. This compares to our 2017 adjusted earnings per share of $0.89 after excluding the benefit of the extra week.

Our guidance is based on the following assumptions: We expect comparable restaurant sales growth of 1% to 1.5% on a comparable 52-week basis. We expect restaurant pre-opening expenses of $3.7 million to $5.5 million. We expect G&A expenses between $21 million (sic) [$21.3 million] to $21.8 million. As a result of the enactment of the tax act, our effective tax rate was reduced and is estimated to be between 13% and 14%. With the savings from this reduction in rate, we intend to invest approximately $1.5 million or approximately 40 basis points during the 2018 into national-level marketing and off-premise initiatives, including to-go packaging, online ordering and catering. We expect annual weighted average diluted shares outstanding of 17.1 million to 17.2 million shares, and we expect to open 8 to 12 new Chuy's restaurants this year. Lastly, our capital expenditures, net of tenant improvement allowances, are projected to be between $30 million and $40 million.

With that, I'll turn the call back over to Steve to wrap up.

Thanks, Jon.

We remain confident in the long-term prospects of our business. With the broad appeal of Chuy's concepts, our focus on the core fundamentals, disciplines -- and disciplined development strategy and store-level initiatives that were outlined earlier, we believe we have a long runway of opportunity ahead to grow the Chuy's brand and bring our authentic, freshly prepared Tex-Mex-inspired food to both new and returning guests.

Before I turn the call back over to the operator for questions, I'd like to thank all of our employees for their tireless work and dedication in delivering the Chuy's experience to our guests every day.

With that, we're happy to answer any questions. Thank you.

(Operator Instructions) And first, we have David Tarantino from Baird.

I guess, a couple of questions here. First on the same-store sales, which -- or encouraging, I guess, in the fourth quarter. Can you talk about kind of what you're seeing so far in the first quarter now that we're deep into the quarter here?

Yes. Yes, David. What we've seen is -- we ran into some splashy weather again, it seems like, in the first 2 periods. You take out that noise, though, and I think it's been pretty comfortable to what we saw in the fourth quarter, take away the noise of the weather.

That noise was about $960,000-some.

Yes, $960,000.

Okay, for the negative weather impact quarter to date, that's the number to use? Okay, great.

Yes, take that out, and we're pretty much on the same trend line that we had in the fourth quarter.

Great. Is that -- when you talk about the fourth quarter, is that inclusive of all of the puts and takes you talked about in terms of calendar and cannibalization, so it would be the actual reported number that you're anchoring on?

It would be -- what Steve is referring to would be less the roll-ins. He was talking about a 70-basis point in roll-ins. So take that out of that, and yes, you're on about the same.

Got it, okay. And then Jon, just on the earnings outlook for 2018, if my math is right, there's some downward pressure on restaurant margins. So could you maybe give us a framework to think about restaurant margin for 2018 and where the pressure points are going to be, what the magnitude of those are? Because I guess, the inflation numbers you gave didn't seem too onerous. So just wondering why -- or sort of what your outlook is for the restaurant margin?

Sure, I mean, we gave -- so we're looking at currently 3% in labor inflation. And then overall, we think we'll end up right around that, between the 1% and 2%. Currently, though, year-over-year, year-to-date through the first quarter, we're a little over 3% in our labor right now -- or not our labor, in our cost of sales right now. But we think it will come back here and by the end of the year. But the biggest thing is we have a shift -- this shift for us is rather big. You're talking -- one of the largest weeks of our year is shifted into last year. And so that week alone is about $1.4 million out of the first quarter, along with your -- the weather that we were talking about as well. So the first quarter is going to be down significantly, and that has a big leveraging -- deleveraging effect, especially on labor and some of the other items. But the other thing is occupancy. A big thing in occupancy, normally, that's going up about 20 basis points. This year, we had some revalue -- we had to revalue from a GAAP standpoint to straight line. We ended some of these older stores. We had to re-up our lease, and it increased our rent on those as well as the new stores coming in. So the big thing there is I'm looking at probably a 40 to 50 basis point increase related to occupancy this year over last year. And then in G&A, we're seeing an increase as well. I was hoping that would be some leverage impact, but in G&A, we're seeing about 30 basis points of deleverage on that line on -- mainly related to the performance bonus this year that was basically reversed. And as you know, we always budget -- we budget a target bonus. So with that added back, that's what's causing that deleverage on that. And those are the big items.

Got it. Yes. That's really helpful. And then Jon, as you think about the outlook beyond this year for restaurant margin with this lower rate of unit growth, when does the margin start to inflect or stabilize with the unit growth being lower? And what type of -- on a normalized basis, if you assume a couple of points of inflation, what type of comp do you think you need to hold the margin flat as you look at the next several years?

I think from a top line standpoint, looking at this year would be a little different. But from a store level, I think we need probably in that 2.5% to 3% with the current inflation rates, with everything being equal. Now like Steve said, we haven't really factored in some of our changes and improvements we're looking at in labor. Those aren't factored in, but everything being equal, we'd probably about 2.5% to 3% to leverage or remain flat and leverage those margins.

For 2018.

Well, yes.

Moving on from Stephens, we have Will Slabaugh.

I wanted to ask about the comment on national media and the $1.5 million investment. I'm curious what that would look like, just given your brand is in fairly organic and local from the start. So curious kind of how you'd plan on going about the national piece of that.

National might be a little bit aggressive on that as far as what it is. Right now, we're looking at the people. And we'd looking at a little bit more on the digital side of our business, enhancing the messages to more focused, more laser-like focus on what we believe the drivers are. You'll see us from a major media side, we might do some radio. Where we will be looking at more of a testimonial-type radio. Right now, we're currently testing iHeartRadio up in our D.C. market. And we're actually having -- also down in our market down in Miami, and we're actually doing it the first week we open there, which is a couple of weeks away. And again, we'll be looking at that, and then the strategy will be built out as we get closer to hiring an agency to work with us.

Got it. That's helpful. And then I want to ask about catering, too. Can you talk any more about what you've seen early on in those launches and maybe what you're looking for in terms of any sort of metrics that you might be willing to give? And also, along that same line, what you're looking for to be able to roll that out into additional markets?

Yes, yes. Again, we're pleased with it. I think we ended up getting it in D.C. -- I mean, in the Dallas and Houston market, sometime in the middle of the fourth quarter, where we actually rolled it. And again, we're pleased with the initial coverage. Again, as I mentioned, it's just not the catering, it's also having that awareness out there of really doing the big parties and getting up there. So our brand awareness in the market's helpful on that. But like I said, it's a little too early to throw some specific numbers out there. But again, we're pretty pleased with the amount that -- probably in the fourth quarter, a little bit north of $200,000 was on just some big parties that we didn't have before. And you'd expect that a little bit with the holiday season, but we're fairly pleased, again, with the start of the first couple of periods of 2018, where it's probably a little bit north of $100,000. So we're kind of pleased with that. And as we look, we'll strategically add different catering trucks in probably selected markets as it's prudent.

Good to hear.

This is Jon. I mean, if we're looking at total off-premise for the fourth quarter, we came in about 12.25% this quarter, which was pretty good for us. I think it's the highest quarter we've had ever.

Yes, highest ever.

And we're back to double-digit growth in that area, so we've been very pleased with those results.

Great. And then last thing for me, I was just curious if you could give us the update on newer stores and then newer markets and then maybe some of the larger ones that you've gone into more recently, in particular, such as Denver and Chicago?

Yes. I mean, Denver, we still only have the one unit there. We'll be adding another one here in a few months. We're pleased with that, and it's been a nice entrance. Obviously, we know we need to get more stores in that market to have the penetration. And the same thing in Chicago. Chicago's one of the newer ones. We went in there in Warrenville, and we just opened in the fourth quarter, I think, Schaumburg, Illinois. We'll be looking at, I think, Orland Park coming up here in the next couple of months. Much, much bigger market, a lot more stores that we need to get in there to really penetrate it. And we're pleased with our entrance in there. But again, as -- in all our stores, if you look, we have 91 stores right now. Over the last 7, 8 years, we've opened up on a base of 8 all stores, so you can kind of say we're all in kind of emerging markets, take away Texas. And we definitely would like to work harder to get our brand message out there a little quicker. And that's part of the reason you'll see the -- more emphasis on a few extra dollars into the marketing fund and really work on our brand awareness.

Next question will be from Jeff Farmer with Wells Fargo.

I'm just curious what menu pricing and traffic assumptions are reflected in that 1% to 1.5% same-store sales guidance range?

Yes, it's approximately 1.5%, pretty much where we've been over the last 9 to 10 years. And it's actually -- it has already gone in. It went in the first period -- the first week of period 2.

And so that would basically imply flat traffic once you have the roll-ins. So I mean, we're -- from an existing store base, we're counting on probably 50 to 60 basis points in positive traffic. But with the roll-ins, it's going to cross that out.

Okay. And then at [HCR], you and a bunch of other companies were asked this question as to whether or not you thought the tax reform would have any impact on consumer behavior. Now that you've had a little bit of time to look at it, have you seen any change in your consumer or sort of your customers' behavior post-tax reform?

I think it's still a little early. I think they just now started getting their tax decrease to be [rolling in their] checks. So hopefully, we'll start seeing that a little more. But -- and plus, we had a lot of noise in the first quarter, like Steve said, with weather. But I think it's still early, Jeff.

Okay. And just a couple of other quick ones. So turnover levels, hourly, manager, any change -- material change there? Accelerating, decelerating? Getting...

Management's still probably right around that 25%, and the hourly's right around 98%. Again, we're pleased that we're kind of right in the same ballpark we've been all year.

Okay. And then just last question. I think -- I can't remember if you talked about this, but off-premise, I think, was mid-10% or 10.5% for most the back half of '17. Where are you comfortable with that number going to or growing to ultimately?

Well, I think as Jon mentioned, I think our fourth quarter was around 12.25%. And what we've done over the last 4 to -- actually, 4 years until last year was a high, like 8% or 9%. We'd like to see that just increase in the double-digit rate yearly.

Okay, yes. So I missed that. So I looked at like the third quarter of '17, it was 10.3% and it jumped to 12% and change in the fourth quarter of '17. You touched on that. But what drove that? Is that seasonality? Or from a sequential improvement, was -- how are you guys more -- ultimately more impacted or affected?

Yes, I think it's a few things. I think it's -- number one, I think we've really worked on our to-go throughout the year. It's just not now, but it's years. And we had, again, the catering. I think I threw about a $200,000 number on top of that a little while ago as I was talking about that. And then we're probably getting a little bit more out of delivery services also.

Next from Stifel, we have Jon Conley.

I just had another question for you on the Chicago store. I believe the Chicago stores opened with a slightly higher price menu. Do you have any concerns that the higher prices will hurt demand in Chicago?

No, no. I think if you look at -- we have 4 different-tiered menus ranging from the one we have in Texas, all the way up to the 4 which we actually have Miami and D.C. and Chicago. Our value spread -- and when we do pricing, we look at all our competitive menus, just not Mexican. We look at all the casual dinings. Our value spread in the Chicago -- our tier 4 is a much wider spread than even our tier 1. If anything, what I've been nervous about there, as we've gone into D.C., you got us doing some customer intercepts is they sometimes think we're too cheap and don't understand the quality we gave, so we need to spend more time explaining that. But no, our value spread's very strong in those markets.

Okay, great. And then just to kind of shift gears a little bit over to the marketing front. Should we expect that $1.5 million to be spread out over -- evenly over the course of the year? Or is it going to be more weighted to the back half as that marketing agency comes on?

Well, we kind of -- I think you can spread that out as kind of 1% of our sales kind of throughout the quarters, but the $500,000 of that will probably be in the back half. The $500,000 is going to be related to our off-premise, and really basically new packaging -- on to-go packaging, which will coincide with us rolling out our online ordering. So that will be in the back half.

Okay, great. And then just one last quick one. I know last quarter you guys announced a share repurchase program. It doesn't look like you guys bought back any stock this quarter. Do you guys have any plans to increase that or be more aggressive with it as a result of tax reform?

Well, we want to be -- I guess, we want -- at this point in time, until -- we want to be a little opportunistic with that. We actually had some orders in, but by the time we were able to trade, the stock had kind of ran from us. So we didn't get an opportunity to do that. We don't want to just buy at any price, and we only have a 3-week window after we release with where we can buy. We're looking to possibly put in a 10b5-1 plan that may put some limits in that we can buy outside of the period, but we haven't drafted that yet. So we're still looking to have opportunity to do that, but right now, given the run-up in stock, we just -- we haven't bought any back. This year, we, at least, want to buy back the dilution.

(Operator Instructions) Next, from BMO Capital Markets, we have Andrew Strelzik.

A number of your peers in casual dining have been using some of the tax savings to reinvest on the labor side and you guys are taking a bit of a different route. So I guess, I'm wondering what made you comfortable not making that investment in wages? And are you concerned at all that you're going to see those turnover levels tick up? And what would you do if that was the case?

I think if you look at what we've done over the last 2 years, if you look at 2016, it's where we really jumped in and you saw a big jump in our wages rates. And when we were about 4%, we invested in 2016 as a whole. And then over the last year it was over 3%, and we're looking at another 3% this year. And we always seem to be investing in that, and that's what we plan on doing. Right now, we just thought we'd look at the compelling message of what Chuy's is in our emerging markets.

Okay. And on the commodities side, you said right now, it's running a little bit over 3%, so higher than you're expecting for the year. What items within your basket are really driving that outsized inflation that you're expecting to come back down?

Well, it's really the -- when you're looking at the year-over-year, you're looking at the higher prices at the end of the year versus the lower prices at the beginning of the year. So...

And what did we end up for the whole year? 1.25%, 1.5%?

Yes, we ended up about 1.3% for the year. So if you're looking at -- I don't have that in front of me right now. I'll have to get back with you that -- with you on that, Andrew.

Okay. And my last question, based on some of our industry conversations, we've heard about a loosening real estate market kind of starting to emerge. I'm wondering if you guys are seeing that at all or if you're expecting that to materialize going forward?

There's been people talking about that for a while. We haven't seen a whole bunch. It's been kind of a -- as we're moving forward. We definitely have had a couple that we'd been able to renegotiate, that we're going to walk from, so that's a positive thing for us. But overall, I'm seeing pretty much a stable market on the real estate for us.

Next, we have Nick Setyan with Wedbush Securities.

Jon, the 3% labor inflation with the 1.5% menu pricing plays kind of a 50 basis points or so of deleverage just from the wage inflation portion. Can you just kind of clarify, in terms of the new unit impact -- the new unit inefficiency impact on top of that we should think about in 2018?

Yes. I mean, we're looking to get a little leverage on some of the things that we were talking about on the existing stores, which will lessen that impact that you were talking about. So overall, we're looking at kind of labor increasing around 50 or 60 basis points for the year. It's kind of what we're looking at.

Got it. So all in, 50 to 60 bps per year.

Yes.

Yes.

Okay. And then just to clarify the quarter-to-date commentary. Is that taking the 1.3% in Q4, adding the 70 bps in terms of the stores coming into the comp base, and that's subtracting the weather impact?

Yes, go through that one more time.

So take the Q4 1.3% comp, add the 70 bps from the stores coming in, so I guess, that gets you about 2%-ish. And that's subtracting, I imagine, 60k or so of the weather impact?

Well, you got to take out the 100 bps related to the extra day, Nick. So basically, we're -- we'll just say quarter-to-date, we're looking at just shy of 1%. That's kind of what we're talking about, without the weather impact. Without the weather impact and the roll-ins, I should say.

And ladies and gentlemen, that does conclude our question-and-answer session. I'd like to turn the floor back to management for any additional or closing remarks.

Thank you so much, everybody. Jon and I appreciate your continued interest in Chuy's, and we will always be available to answer any and all questions.

Again, thank you, and have a good evening.

Ladies and gentlemen, that does conclude today's earnings call. Thank you for joining us. You may now disconnect.