Red Robin Gourmet Burgers Inc (RRGB) 2004 Q1 法說會逐字稿

Good afternoon, and welcome to the Red Robin Gourmet Burgers' first-quarter earnings release teleconference. At this time all parties have been placed on a listen-only mode, and the floor will be open to your questions following the presentation. It is now my pleasure to introduce your host, Michael Snyder, President and Chief Executive Officer. You may begin, Sir.

Thank you, Maricia (ph). Hello, everybody, and welcome to our first-quarter 2004 conference call. If you haven't seen our first-quarter earnings press release, it can be accessed on our website at redrobin.com. A replay of today's call will also be available at that same location on our website.

Today, we want to cover the results or first-quarter of 2004, which was a 16 week quarter. And we would also like to update our current business trends and projections for the second quarter and fiscal year of 2004.

I would like to also take a few moments to talk about our brand research that we've recently completed.

I do need to remind everyone that part of our discussion this afternoon will include forward-looking statements. These statements are not guarantees of future performance. And therefore undo reliance should not be placed on them. We refer all of you to our filings with the SEC for a more detailed discussion of all the risks that could impact our future operating results and financial condition.

In addition, we just issued a press release in anticipation of tomorrow's filing of a shelf registration statement with the SEC for the 1.9 million shares owned by our investment partner Quad-C. I need to inform you that the comments made on today's call shall not constitute an offer to sell nor solicitation of an offer to buy our securities. And also, to comply with SEC rules, we will not be in a position to answer any questions or comment further about the registration during today's call.

That said, we are very pleased to report another strong quarter.

Total revenues for the 16 weeks ended April 18th increased 25.7 percent to $116.7 million. And our restaurant level operating profit increased 31.5 percent to $22.5 million.

Our net income for the quarter was approximately $5.2 million or 32 cents per diluted share.

So in the first quarter of 2004 we have comp restaurant sales increase of 8.4 percent for our Company-owned restaurants. And we're proud that this was driven by a 7.1 percent increase in guest counts, and approximately a 1.3 percent increase in the average guest check. That was from a price increase that we took in January.

Our Company-owned restaurants had comp weekly sales averaging $61,134 compared to $56,372 during the same period last year.

And, we also opened seven new restaurants during the first quarter and our franchise partners opened seven new restaurants during the first quarter. And they have opened three so far in the second quarter.

So top off this, I think, pretty good quarter, we have recently completed our most expense qualitative guest research in our 35 year history. This research was conducted to learn more about the ideal casual dining experience, and how -- and (indiscernible) try to evaluate how Red Robin measures up to our guest expectations.

And based on first quarter's performance of '04 it looks like we're doing pretty good job meeting their expectations.

Our most loyal guests -- and those are guests that contribute about 70 to 80 percent of our sales -- feel an emotional connection to our brand and they have identified with our four cornerstones -- and those four cornerstones, I will remind you, are values, people, burger, and burgers and time. We think these four cornerstones differentiate us from a lot of the other casual dining operators out there.

So briefly, our values cornerstones -- our guests at Red Robin realize that we strive to be a wholesome and unbridled experience. And we do this through our people. This dedication to our values through our people helps creates a culture that attracts team members who share our values. And our guests really do recognize this and reward us for this.

Our burgers cornerstone -- well, this is essentially just talking about our high quality food and beverage products, and preparing them just the way our guests want it. Our frequent guests customize our menu heavily. Whether it is Adkins or Weight Watchers, or South Beach, Critican (ph) -- whatever dietary or nutritional goal you're trying to achieve, this may require some customization of menu items.

Well, at Red Robin, our guests tell us that customization is easy. We customize for our guests and do it fast, easy and accurately. Actually, a little bit of -- approximately about 50 percent of our menu items rung in are customized in some way, shape or form.

And finally, our cornerstone of time -- our throughput service strategy allows guest experience times of 37 minutes on the average for launch, and 42 minutes for dinner. So what this means is that Red Robin fits into the busy active lifestyle of our guests without having to sacrifice or compromise on service and quality.

So, our emphasis on these areas allows Red Robin to build long-term relationships with our guests, and deliver those special moments that they're looking for. So, we're really excited about this research and I believe it will allow us to strongly leverage our unique points of differentiation and strengthen the Red Robin brand as we grow.

So, at this point I will turn the call over to our Chief Financial Officer, Jim McCloskey. Jim?

Thanks, Mike. Before I get started, we will be talking about some non-GAAP financial measures. You're going to find supplemental data on our earnings release that reconciles our non-GAAP measures to GAAP.

Well, it was a great quarter. Let's start with sales.

We had a $23.1 million increase in first-quarter restaurant sales compared to a year ago. Overall, this increase is driven by a $15.3 million of sales of new restaurants including the seven new restaurants in Q1, and the 7.8 million from the 8.4 percent increase in comp restaurant sales.

I know we will get this question -- we did finish the quarter with same-store sales of 8.2 percent in the last period of quarter one.

Our same-store sales results included a 1.3 percent price increase taken in January. We will continue to monitor our operating costs if we see any additional stretch (ph) to our operating costs we will take an additional price increase in 2004.

As Mike indicated, average weekly sales for Company-owned restaurants were 61 134 (ph) during the first quarter, representing an increase of 8.4 percent. Average weekly sales from (ph) restaurants not in the comp base were 57,000 068 (ph) in the first quarter.

Franchise, royalties, and fees increased 28 percent or 723,000 in the first quarter compared to last year. This increase is attributable to, surprise, higher franchise sales and more restaurants open -- including seven new restaurants in Q1.

Overall, our comp franchise restaurants reported a 5.6 percent increase in the U.S. restaurant sales during the quarter, and 4.5 percent in Canada.

Our comp franchise restaurants averaged 54,000 060 (ph) in the first quarter versus 51 197 (ph) a year ago. Canada was 38 362 (ph) versus 36 708 (ph).

Restaurant operating costs -- cost of sales as a percentage of restaurant sales for the first quarter was 23.7 percent, a 40 basis point increase over the first quarter of '03. This anticipated increase is due primarily to higher pork, pot roast, hamburger, bread costs from last year.

Sequentially, our cost of sales improved 20 basis points over the fourth quarter of '03 as hamburger and some other meat costs trended lower.

Labor expense as a percentage of restaurant sales for the quarter was 35.4, which was 10 points higher than '03. But sequentially was flat with the fourth quarter.

In general, the increasing workman's comp costs and higher bonus expenses offset the efficiencies we added in controllable (ph) labor.

Operating expenses as a percentage of restaurant sales were 14.6 percent, a 90 basis point improvement over first quarter of last year. And a 40 basis point improvement sequentially.

The improvement was due in part to the discontinuance of one of our marketing funds in the first quarter of '03. But, overall, we saw improvements in these relatively fixed costs from our 8.4 percent same-store sales increase which levered our services, maintenance and marketing expenses.

Occupancy expenses as a percentage of restaurant sales were 6.5 percent or about 40 basis points lower than the first quarter of '03. The improvement in occupancy was due primarily to an increasing proportion of ground leases and owned properties, and of course the leverage from our same-store sales increase.

Just a little color on that. For example -- in our comp base about 29 percent of our units are in line. And generally, an in line space is going to have higher occupancy costs than a freestanding unit.

In our non-comp base, about 11 percent of those. So you can see that trending away from any kind of an attached units to nonattached, freestanding units.

Restaurant level operating profit -- in comparison to the first quarter of '03, restaurant level operating profit was up 31.5 percent, an improvement of 90 basis points, due to the decrease in certain restaurant operating costs and the leverage that we just talked about.

Sequentially, restaurant level operating profit improved 70 basis points over the fourth quarter of '03. That was, again, mostly leverage and (indiscernible) occupancy expenses, and some lower hamburger and other meat costs.

Our margins continue to be among the highest in the casual dining business.

Depreciation and amortization as a percentage of total revenue was flat at 4.9 percent compared to the first quarter of '03. Overhead, G&A, which includes franchise development expenses, remained flat at 8.9 percent with the first quarter of '03.

We had actually expected higher overhead costs for the first quarter, but the leverage we got from our same-store sales increase and some lower marketing expenses moderated this line item.

We should note that marketing -- we only spent 30 basis points for marketing in the first quarter. So, we achieve those strong same-store sales without having it driven by media. We took any of the savings that we did have in marketing in the first quarter and we spread out to you on the three quarters.

Preopening costs increased 440,000 or 56 percent compared to last year. The increase is due to opening of two more restaurants in this quarter versus last year, combined to slightly higher average cost of restaurant -- we're about $187,000 preopening costs on a per unit basis, slightly higher -- I think we were at a year ago we were up at 178,000. And we had -- that's the average cost. We did have one opening in Wilmington (ph), North Carolina since that was our first unit in North Carolina, was slightly higher at about 193,000.

Net income, diluted EPS -- I'm sorry -- income from Ops was 8.6 million or 7.4 percent of revenues. That's compared to 6.1 or 6.6 percent of total revenues in the first quarter of '03.

Overall, we earned approximately 5.2 million during the first quarter of '04 compared to net income of 3.5 million. That's an increase of 46.4 percent.

Diluted EPS was 32 cents this year versus 23 cents last year.

Capital expenditures for the quarter were just over 20 million, including 16.5 million for new restaurants and around 3.5 for remodels replacements computer equipment.

At this point, I will turn it back to Mike.

Alright. For the current outlook for second quarter and full year 2004, we're going to increase that a bit.

For the full year we expect to open 21 to 22 new Company-owned restaurants and our franchise partners should add about 15 to 17 new restaurants. We expect to open 4 company-owned restaurants in the second quarter. And our development schedule for the balance of 2004 is expected to be about 5 or 6 openings in each of the third and fourth quarters.

For the second quarter of 2004, which is a 12 week quarter for us, we expect total revenues of 90 to $92 million, and a net income of 26 to 27 cents per diluted share. These projected results are based on expected comp restaurant sales of somewhere around 3 to 5 percent.

For the first -- for the full year of 2004, we expect total revenues to be around 397 to $402 million. And for the full year we expect comp restaurant sales growth of somewhere around 4.5 to 5.5 percent.

And I probably do not need to remind some of you, but our comp restaurant sales comparisons will be a little bit more challenging during the second half of '04 than they are in the first half of this year. We had a very strong second half of '03.

So, all that said, based on those assumptions our 2004 earnings guidance is increased to $1.20 to $1.22 per diluted share. And our CapEx -- or our capital spending for the year is expected to be about $63 million.

Commodities -- I will let our commodity expert, Jim McCloskey, get into it -- but, yes, costs do have a tendency to go up. And I believe in the casual dining arena, and especially Red Robin, we do have some insulation on that.

So, again I will let Jim's crystal ball guide you a little bit more on that in Q&A, if you would like.

So, that concludes our prepared remarks. And, Maricia, please open up the call to Q&A

(Operator Instructions). Mike Smith, Oppenheimer

Jim, I know you're not supposed to put this in your release. But could you just give us what the systemwide sales were for the quarter?

Well, you know, the SEC really slapped our hands on that one. I think -- you know what, Mike? I will (indiscernible) but we can't talk right here.

I think he's probably -- are you looking for the percentages, aren't you?

no. I was looking for the dollars.

For total system, about 198 million.

And then, I urge you -- I thought I heard you say that you expect franchisees to open 15 to 17 stores?

Yes.

Yes.

Because the press release said 5 to 7 additional --?

That's right. We have 10 open already.

And could you break out your openings by quarter?

Company openings?

Yeah.

We opened seven in the first quarter, four in the second, and it (indiscernible) will be 5, 6, 5, 6 for third quarter and fourth quarter.

Okay. Thank you.

Jeff Omohundro, Wachovia Securities

A couple of questions -- I guess first, after that buildup, I got to ask the commodity expert if we get a little more clarity on the outlook for the balance of the year?

Well, Jeff, the first thing we'd like to say about commodities is we just don't think it's a big deal. And we don't think it's a big deal, quite frankly, in any of the restaurant business -- in any of our contemporaries.

Unless you've got a value perception problem with your guests. Which, clearly, Red Robin does not have.

And so, as prices -- commodity costs -- if there is any increases in commodity costs, and therefore some pressure on our margin, the casual dining industry, in general, has shown the guest has shown, that they accept those price increases with very little resistance.

So -- but, particularly for Red Robin, we're not really -- we're not really up against any particular commodity costs to put us completely out of whack with our cost of goods sold.

We use chicken the most. We have chicken contracted through the end of the year. We've contracted cheese. We're seeing -- though we saw some moderation in some of the beef and pork early in this year, now it's going right out of the roof.

But, on the other hand, soybean market just collapsed in the last week. And in fact, took another, I think, 400 basis point decline today.

So, overall, there are a lot of things -- there's a lot of volatility out there in the commodities. You -- cut through it all -- we will protect our margins.

Okay. And I guess the follow-up to that, since you're kind of hinting at pricing, would be -- post the Q1 soft drink price increase that you took -- any change of mix there? Or trade down by customers -- anything that you can perceive?

You know, Jeff, there's always changes in mix in our business period to period. Even if we don't take a price increase or we don't change a (ph) promotion -- but we certainly see -- we saw virtually no change in mix -- but, from the price increase -- if anything, we actually saw some specialty drinks that we were -- that we -- I think we did some table tents on that were doing very, very well. So, it's -- so we actually saw no hiccup from that.

Okay. And then, finally, you opened a fair number of stores in the quarter. Are you pleased with the performance of those new stores?

We are. Yeah, we are quite pleased. And I have to say that we are quite pleased with -- it continued improvement in our franchise openings, also.

We've got some -- we've been telling you for about a year now that we've got some great franchisees coming on with significant experience. Those franchisees, combined with our increased franchise support that -- we've added our franchise support substantially over the last six months. We have some very experienced people there in that area that know exactly how to get these franchises open, and we're seeing the results.

Very good. Thank you.

Andy Barish, Banc of America.

Two questions. On the second quarter numbers that you gave out, it would imply a little bit of margin contraction year-over-year at the restaurant level. What is going on there if commodity costs are having absolutely no impact?

And then, secondly, on your research, the new stuff that you have seen recently, did you have a chance to go into a lot of newer restaurants and get a sense of the customer there? And is there a difference in terms of perception? Or do they get the four cornerstones pretty quickly even in new restaurants? And do you try to attract those guests with the local store marketing and that kind of stuff?

Alright, I will handle the commodity costs and I will throw the guest research back to Mike.

From comparison from '04 to '03, second quarter '03 was a blowout quarter for us. Everything was working right. So we did have -- we did upgrade margins in the second quarter of '03.

We are -- in our projections -- you know, this is when people ask us about our forecasts, quite frankly, our forecasts have consistently -- we try to be reasonable. Maybe that's called conservative. We think we can beat this and so far we've done okay.

And so that's really the continuing pattern that we will have.

We look at -- we're looking at all the threats -- on a long-term basis we absolutely standby what we're saying. We don't think commodity costs are going to have a significant effect on us. We do expect to see some improvement in that area.

Thanks.

Andy, it's Mike. The research -- we did it in Colorado, Washington, California, and Michigan, Pennsylvania, Maryland, and we found no difference in the guests perception of what Red Robin is in those areas.

The only real difference, Andy, is the number of guests who know us. And since we only have 220 or so restaurants in the system, we have so much room for growth and so much opportunity to expose this great brand to more and more guests.

We sampled some guests from older restaurants and newer restaurants. Interestingly enough -- I think it's interesting anyway, Andy, that sometimes it takes about two or three visits for a new guest to fully understand the price value relationship, the benefit, the time save, the throughput issues that -- implementation that we have.

So, I think it takes about two to three visits for a guest to truly understand how to use Red Robin. And as I mentioned in my opening remarks, our frequent and loyal guests know how to customize us. Customize the menu items at Red Robin.

So, one of the things we're working on is to help new guests and new restaurants know about the customization and the really cool ways of how to use Red Robin.

So a new area -- for example, Andy, a new restaurants in Connecticut -- can I say numbers?

(laughter) These are not projectable (laughter)

New market for us. We have not been here before. 105 first week. And it is holding. So it's -- Manchester, 160 (ph) -- am I supposed to say these numbers? 116,000 (ph) in Manchester (technical difficulty) so, evidently, they know how to use this relatively well out of the blocks. But, it does take a little bit of time for them to fully understand the concept.

It's helpful, thanks.

William Mack, Standard & Poor's.

Thank you very much. Just wanted to ask about the guidance and one quick follow-up question afterward. The new revenue and earnings guidance for the full year would imply to me that quarters two, three and four are not quite as good as you guys had originally expected. Are you guys just being conservative?

Well, certainly we're not taking -- projecting (ph) out our 8.4 percent same-store sales increase for the year.

And so, I think all of us in the industry are seeing this tremendous surge in guest counts in the leading names. And, quite frankly, we don't know what to do with it. It's so much good news.

So -- sure, we are conservative. I think we are conservative.

But, we started the quarter, I believe, at 26 cents. We raised to 28 cents and we came in at 32 cents. We raised the year by -- and we continue to raise the year -- in the mid quarter we took it to $1.19 and we've taken it up to $,1.22, so we've taken the year up 3 of the 4 cents that we beat our first quarter margins. So, we're pretty close.

And on any potential price increases you might take going forward, you haven't announced anything and you already took one at the beginning of the year. But what's -- given the guest counts and given what looks like very favorable responses, to your brand and the concept as you are rolling it out, what's keeping you from instituting price increases sooner rather than later?

William, this is Mike. I have always practiced keeping that price value relationship with our guests at the strongest possible place that we can keep it.

We have always been able to increase prices. And I want to always keep it that way. So we have that ability, and we keep in our back pocket to use at those times that we need it, after we have tried all other avenues of protecting margins. So we will raise prices and we can raise prices to protect our margins. We are not afraid to do it.

But I think it's mainly because we've always positioned ourselves to give us the luxury to be able to do it without hardly any guest negative response each time we do it.

Now, Jim -- his magical crystal ball is keeping an eye on it. And if need to -- if need be, we will make another adjustment this year. But right now we're just keeping an eye on it.

Okay. Thank you.

Matthew Difrisco, Harris Nesbitt Gerard.

I guess, one bookkeeping question. I think you gave it earlier. I might have missed it. Your average weekly sales number, inclusive of all stores. Did you give that already -- company-owned?

Our company-owned average weekly sales?

Yeah, I know in the press release you gave the comp average weekly sale. I'm looking for the average week of sale all-inclusive new stores in and out of the comp base?

Generally, I don't think we actually give that. But what that number is 58,152.

Okay.

That's both comp and noncom.

And then I guess -- can you give us an update on what you are seeing in -- your concept's opening up, you got a ton of geographic growth opportunity -- what do you have in your model if any new franchisees signed up in '04 -- not necessarily if they're going to open a store in '04, but maybe be developers in '05 and '06?

Yeah, we've got some good news (indiscernible) that area. You never count your chickens before they are hatched. But I think we will announce them pretty -- we're talking to some really high-quality franchise developers right now. We were very, very excited about the quality of the developers that have been coming on in the last 18 months. We may even be more excited about the developers coming on the next 18 months.

Okay. And then, also on your comp -- the color that you gave on the comp towards the end there, I think you said that -- or you implied that the comp at the end of the quarter was still around the 8 pace? Is that correct?

It was 8.2 percent.

8.2 percent in the last period, meaning the last thirty-day period?

That's correct. So, Matt, I want you to know, we did decelerated from 8.4 to 8.(multiple speakers)

Yeah but that's not -- that's a healthy deceleration (multiple speakers) can have one.

I am concerned about that. (multiple speakers) I'm kidding.

So I just wanted to view the context of your 3 to 5 percent guidance and the prudent amount of conservativeness, just to make sure that there's not a 3 to 5 trend going on now, but the last or latest trend that you have been seeing is roughly around -- closer to that 8 range still?

Well, you know, we only give quarterly -- on a retrospective basis I will get into a little detail on a period basis. But on a quarterly basis we don't give updates. We're comfortable -- we're comfortable with that 3 to 5 percent, Matt. And that's probably all we're going to say.

Excellent. Thank you.

Jeff Randall (ph), JMP Securities.

I'm still having trouble understanding the guidance for the second quarter. Last year you all did 27 cents. It looks like now you're coming in roughly flat. I understand that on a share dilution count you're down about 5 percent. But, maybe you can help me understand just why the number is flat with the prior year, even with the share count?

Yeah, Jeff, the share count is obviously the biggest -- well there's two big reasons -- one is the share count. That probably made about a, say, about a 3 to 4 cent per share difference.

Right.

The rest of it is the second quarter last year was a blowout quarter for us. And so, we're just being a little more conservative this year. And don't expect a blowout like in terms of profitability.

If you look at last year, the second quarter was the highest profitability on a unit level basis of any quarter we had. And we had to explain why it was so good last. So, you know it was (laughter) (technical difficulty) planets aligned last year -- we're expecting a good solar system this year.

Have you modeled in any increase in share count due to the shelf registration or not?

No. There wouldn't be any.

Oh, I'm sorry -- my mistake. It's all from the secondary. Got it. Okay. Fair enough then. Thanks.

Dan Geiman, McAdams Wright.

With respect to the comp's guidance again, is the slowdown over the balance of the year due simply to the tougher comparisons that you are experiencing?

And also I guess not relying on those guest counts?

Or are there some other factors including maybe the prospect of some higher gasoline prices that are kind of baked in there?

Well, Dan, we don't think gasoline prices have anything to do with Red Robin. So, let's say that right up front.

I would not say that we're anticipating a slowdown. I think we're being cautious. We have in -- since Mike has taken over, we have averaged over 5 percent same-store sales. We've had plenty times -- not since we've been public. Actually, it's just (indiscernible) improving since we have been public. But if you looked at the years prior to that, we were doing 9 and 4 then 7 and so we've got some history of being able to do that in the past.

But, at the same time, if I'm dealing with other people's money, we're going to be cautious. And put out a bar that we think we can reach. Without extraordinary measures.

Okay. Thank you.

Jonathon Waite, McDonald Investments.

I've got a couple of questions for you. First off, Mike, on this market research you've done -- how does this change how you will do business going forward? And how you approach the loyal guests?

Interesting question. And I don't think we've totally figured it out, John. We do know that we need to educate our new guests on how to use this, as I mentioned -- better than we have in the past.

We do know that the -- that our ability to honor our guest's time with our throughput service strategy is a big deal. And we need to make sure that we can maintain that honoring of our guest's time.

So with respect to marketing, and going forward, as you know we don't spend a ton of dough marketing this concept, which is, I think, a very viable strong point for Red Robin.

That said, we will be able to target some of our marketing a little bit more specifically and address those areas that are -- that resonate very strong with our guests.

So, we can do a little bit more pinpointing and focusing with our marketing efforts.

Okay. Great. Second question I have has to do with seasonality. I'm just trying to figure out with -- we seem to have a similar theme going on. We had this last year as well where you had a like you said a really strong second quarter. But first quarter last year was a little below consensus at the time. And now it seems to have swapped.

As I look back over the last three years, it looks like sometimes the second quarter had the best restaurant level margins. Sometimes it was the fourth quarter.

How should I be thinking about seasonality with your Company? And restaurant margins?

Well, when I think of seasonality, John, I think -- generally think in terms of sales, not in profitability. So, let's talk about sales.

There was some effect -- there is some positive comparisons in let's say your area. The southern California -- if you remember in '03 you've got some -- I think in California you had some of the rainiest periods that they had in Southern California.

But, in California is sizzling for us

Sure. Now, how about like just on a normalized basis -- that's kind of what I'm getting at.

On a normalized basis, our sales probably track as well to retail. So we are -- our slowest periods of the weekly sales are really in January.

It slowly builds up until May, and then when the kids get out and they started visiting the mall, not necessarily buying everything. Then June, July and August are very strong for us.

When they go back to school, there is usually a downturn in September -- October is medium. And then it starts building -- November and December are very strong.

And then, depending on whether the after sale sales are in our first quarter -- first period of the new year or not, generally after Christmas is very strong too.

And from a profit-wise standpoint, we shouldn't think about that from a seasonality standpoint -- is that what you're saying? Or should we just be looking more to how many units you're opening on a year-over-year basis?

Yeah, I think we've had tremendous change in how many new units we've had -- '03 over '02 we certainly upped the percentage of growth. And we have started to -- we opened seven units this year versus I think it was five last year.

So, it's a little faster. And I expect '05 maybe even a little more front-end loaded than that.

So in terms of a seasonality of profitability, the other issues, of course, are in G&A -- you have a franchise conference in the first quarter. You have (indiscernible) costs, annual report and proxy in the first quarter -- which a lot of people is the second quarter. So our G&A costs are always higher in the first quarter. So, that would be a seasonality factor then.

In terms of restaurant level operating profit, I think the mix of new units and those effects of commodity costs -- because it is being more volatile. It does go up and down. Quite so much more than it did two years ago on a weekly basis.

But right now, we are -- we are comfortable with that second quarter number and the full year.

Understood. Thank you, Jim.

(Operator Instructions). Mike Smith, Oppenheimer.

It's been asked and answered -- thank you.

Thank you. There appear to be no further questions at this time. I will now turn the call back over to the speakers for any further or closing comments.

Thank you, everybody, for joining us. And again, thanks to all of our team members and our restaurants and our support offices. Without you folks we would not be here.

So, thanks to our team members. And thanks to all you on the phone for your support. Talk to you later. Goodbye.

Thank you. This does conclude this afternoon's teleconference. You may disconnect your lines and enjoy your day.