Texas Roadhouse (TXRH) 19 Feb 212020 Q4 Earnings call transcript

Company Profile

Participants

Tonya Robinson	CFO
Kent Taylor	Founder & CEO
Jerry Morgan	President
Jake Bartlett	Truist Securities
Dennis Geiger	UBS
Peter Saleh	BTIG
David Tarantino	Baird
Lauren Silberman	Credit Suisse
Brian Bittner	Oppenheimer
John Glass	Morgan Stanley
Jeffrey Bernstein	Barclays
Brett Levy	MKM Partners
Jeffrey Farmer	Gordon Haskett
Andrew Strelzik	BMO
Andrew Barish	Jefferies
Jared Garber	Goldman Sachs
Brian Vaccaro	Raymond James

Call transcript

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Operator

Good evening, and welcome to the Texas Roadhouse Fourth Quarter Earnings Conference Call. Today's call is being recorded. All participants are now in a listen-only mode. After speakers’ remarks, there will be a question-and-answer session. [Operator Instructions]. to like now would introduce, Ms. I the Robinson, Chief Financial Roadhouse. Texas of Officer Tonya

your ma'am. may conference, You begin

Tonya Robinson

Thank and for have also in access ended you, the you XX, be to now, Annie, December website our good found evening, Investors on earnings at It section. release XXXX. the our quarter By fourth may everyone. texasroadhouse.com should

to are future will to part you documents materially statements, forward-looking our of that and factors we our provide to include recent from the statements. related reliance be Before forward-looking and everyone detailed including should begin of of These to formal more We placed results remind remarks, SEC. of not discussion These the could undue differ our a therefore, that release relevant those upon statements discussion filings COVID-XX earnings performance, outbreak. refer I today the guarantees need not our factors with actual all them. cause

refer If can addition, our be release. to information In earnings non-GAAP found GAAP of may applicable, the measures the measures. we in to non-GAAP reconciliations

me is call Texas with Morgan, of Chief Roadhouse; and today of the Kent Jerry President and Taylor, Roadhouse. Executive On Officer Founder Texas

remarks, open call our the Following for will questions. we

the over turn to like I'd Now, to Kent. call

Kent Taylor

of starting dining other restrictions example worked with everyone, were impacted operators Thanks, how many October, of through any capacity in our we approximately the XXXX the reclosure quick other, ready results The mid-November. top The a Tonya, our were of in our and for for this our our and way. challenges toes, uncertainty. thanks, quarter unlike of good must proud After and the us. our joining increased bottom-line we another restaurants rooms, was of how XX faced in stay in I'm throws pandemic along on changes by fourth start very

dining room sales as dining from in the over weeks company-owned and last are Sales have capacity today, limited inside of benefiting restaurants of Roadhouse months XX% of rooms that And over in reopened. reopenings most weekly restaurants demand as restrictions importantly, some have remains ever of our these place. as level for More have and as to of $XXX,XXX The us have XXXX. Texas dine first shown X restaurants our strong XX consumer averaged brand high. capacity the is of easing

be addition, to a our big restaurant of sales In -- restaurant To-Go sales our part business. our continue

XXXX. just or restaurants, For sales averaged during over rooms XX% week of approximately To-Go with dining per the of open, sales weeks X $XX,XXX first

capacity that our significantly expectation larger remain To-Go again. and up of sales a business Our lifted is our part rooms will after restrictions dining are fill

we to are to waiting we are normal I'm simply return everything not, for sorry. or -- However,

a concepts, franchise growth restaurants opened X XX restaurants, our mode. including locations international XXXX, new X In our and in are company-owned we We X Korea across opened in partners Taiwan. and

we Korea, development XXXX new providing addition, XXXX agreements back Puerto pipeline for in several the of signed and is which Brazil In and a locations beyond. Rico, of half for

company XX shaping and plan restaurants many open XX X this including as development Jaggers restaurants Bubba's up nicely, one plan we between is to XXXX and Our restaurant. year, XX as and

our to our continues in above December expectations. Speaking of way location Jaggers, newest perform early opened

for We already opportunities. XXXX, company-owned a the continue franchise potential locations in to have more works we few explore and will

expand to continues business retail recently agreements. with X Our signed licensing

second Both to bottled seltzer variety branded mix, are of cocktail they a We returns. while version the the for believe, that a locations in our flavors. over for have retail is is XXXX. of margarita Texas in will a These offered be canned minimal first Roadhouse The potential margarita be generate Butcher our with initiatives, to low-risk sometime and require during together Shop are time, strong expected business investment.

growth our about opportunities. We excited are

to the face continue However, pandemic. challenges we remain focused due on to we operational the

like safety top priority well-being Just guests this employees our our of remains year. XXXX, in the and and

business wage throughout We of pressures inflationary commodities from food impact to packaging. the rates are of to feeling also the supplies the and cost

have options. we with developments could conversations And would close into as our and federal about we the their factor Over our keeping wage as additional be increases feedback, as pricing and the of on menu the operators based weeks, take any pricing on will menu minimum middle we pricing eye second coming tip quarter, decision. will early some a

the normal, to we position. of current While certainly and business is by business the direction are not financial back encouraged our

as the to requires for the of committed strong about to President will are the while and decisions our That pleased recent company, why experience business, my Morgan right also existing addition We the right making focusing is the leadership. the of that same the Roadhouse. team of making benefit leadership on growth has. Jerry long-term management has our for Jerry vision His decisions I'm perspective future entire be great shares Texas the addition a team. and passion

give us of thoughts, you don't why some Jerry, So your man?

Jerry Morgan

I created appreciate a company of of Prairie. that. XXXX managing amazing Grand starting excited honored the and I'm as I the in serve my joined big location Kent. Thanks, this partner part in as in has to when a that company XXXX. This at President back been life Kent first Texas

them I spending in understand and ways I with Over our have and serve for the time person each better weeks, support can last set up center success. several to every been

out the country. of with a And weather new build Kent to issues leadership back of with I As folks to to to our areas Ken, to become team forward I dealing pass success. would working all the across the our and involved I it I upon before business, our give look shout in like

for if doing you Thank out back need are We and safe. -- are you. you all Kent, do here that you you us. there stay to

Kent Taylor

you center restaurant Thompson, have new Thanks, operations, guidance your support partnering well our forward in Jerry. the ideas. even and working strong more regional on focus partners with your to our as role. I with I'll on new closely look at to as With Doug COO, time

a operators as center you track and ready would efforts, to as in Roadhouse for the over hesitate was I've past did the the of staff. too. tackle why on next to For sets world, been fine-tuning year decade. fast your our you not working X retail lot We've retail thank and a get growth is efforts Without XXXX challenges back in had new support to a and in big with food, initiatives be in want and Texas I future full-service with fun us very so filled not strong to it not example, successful Jaggers, which end XXXX. months all on and and up overcome them. your

take away. it Tonya, Now,

Tonya Robinson

first And the and week Over growth our December XX% sales the at per so given XX% XXXX weeks weekly at represents the decline we quarter sales. for $XX,XXX November approximately as year. for only fourth January are per And and sales and of Comparable respectively. limited X.X% a impact Kent. of average is are approximately future, X.X% our we think dining increased rooms in the rooms extra in dining for as per a quarter. reopened dining restaurant about decline like and to sales X.X% restaurants sales restaurants and of for the as in of restaurants, look also week down October, Kent sales their inside more negative of limited great Thanks, sales February. week averaged Comparable X X% restaurant or X% are sales and to approximately XX% mentioned, in over the To-Go capacity XXXX. under our capacity week weeks this month, room slightly decreased higher our encouraged This or $XX,XXX have To-Go during XXXX. XX% accounted more sales quarter X.X% can capacity in see, could volumes periods, is sales use have sales in-store per X over lapping This who of comparable seats, To-Go the what grown first increasing. This slightly declined see decreased fourth their that far sales total of By to of fourth $XX,XXX of those XX.X% X.X%. weeks. our

extra mid-teen expectation volumes So initial XXX total Restaurant due percentage capacity XX check. sales last a to-date, we XX.X%, flat decline approximately offset with the of benefit minimal sales dining the in seeing was closures a increases. indoor coming decreased and overlapping X.X% dining December, guests because to and margin fourth as of Margins To-Go year, lower our overall and sales of in of are led menu profitable costs to as Food the and from points a inflation the To-Go fourth versus points as of quarter. sales entrees which in of of were by basis less Commodity week basis approximately sales XX.X% of essentially shifting room drop-off beverage total percentage and in quarter the the the transactions. higher below increased larger-than-expected at guest of percentage the were pricing to XXXX. November remaining margin impact to benefit lower of

of sales For by Labor to other the X.X%. X.X% wage down approximately offset to pork on expect hours, reduction in basis includes prior in of currently fourth increased percentage compared as XX.X% quarter. X%, points an decrease period. year were and X.X% The week XXXX, store driven Labor partially XXX of we dollars per commodity the beef, by prices inflation and total inflation products. higher a oil-based

In tax driven cost on reserve incurred of a for $X.X addition, employees, million a payroll one-time million week. items negative insurance restaurant net enhanced credits. by compared pay quarter It this for hourly had year. last release $X.X quarter was to impact benefits employee dollars labor store X.X% retention, this charge a and of also million This per includes charge $X

costs, XXX as operating To-Go higher of basis and as costs other costs. as points volumes Finally, was sales total by COVID-related operating PPE, last lower on percentage expense which Other added was year. supplies of were purchasing other negatively impacted XX.X%, than the a well sales

prior restaurant The travel million below a million the $X.X equity G&A were reduction and the cash primary $X.X compared for $X.X the margin, Moving decrease as a to quarter meeting in of and compensation of expense. and million drivers period. costs year reduction decreased

expenditures with In of new the $XX $XXX coming X $XX are up from was driven cash, from cash the million of The quarter. cash on $XXX of most $X.X of of increase end XXXX capital flow, overlapping of locations. -- $XXX we to of schedule with we CapEx openings $XX flow store million. the regards ended for the from is the Based addition, the the million for from benefit which expense With XXXX. XXXX, third by operations, year million to our projecting acquisition million of and the offset full franchise of was the quarter week extra fourth of million million fourth the from extra quarter

We stores, dining positive new from expect we X% the will week growth These to easing continued momentum assume of expectations lead in sales the room XX X% along XXXX, to store XXXX. these of we with restrictions. to opened see in continue

inflation depend and will For margins of XXXX, lifting as improve and sales supplies. related XX% of but timing believe restrictions, easing 'XX restaurant capacity return room pressures -- The to the sales COVID-related to should rate dining cost Margins from a attainable room and mix restaurant margins costs. given in of to on are of ongoing pressured To-Go dining sales, we the cost lower environment. the to pre-pandemic remain current sales continue grow, will the XX% wage

a business of and flow return open our reiterating believe be well our our line comments million strength generation, cash year. questions. for financial free will remarks position later Operator, improvement the we flow this please net Finally, earlier uses of of to usual continued by prepared cash conclude on I'll With $XXX we cash to of position. and positioned the

Operator

[Operator Instructions].

Bartlett Securities. our first We have Jake of the from line question from Truist

Jake Bartlett

in My are in weeks down weeks? first deceleration And last same-store of understand a down confirm, factors less. just there quarter, had X that that were question But would to were January, they sales have the there relating just any weather? to to is the X the X%. Or is other

Tonya Robinson

February. there, but comes what benefit on are and sales, get the what for calendar Yes, into Sure. on estimate impacts is to this benefit that sales We Day, X-week a X that's had Tonya. And X.X% that on from And weather, which New total total looking a bit shift probably to less the negative weeks. benefit number, those of about both weeks we going Valentine's is X the in X.X% you was weeks, think a then some obviously January. negative play probably you January, X%, Hey, the we're impact related about the we Year's little on also got Eve. of on X a when at Jake,

Jake Bartlett

XXXX and as encouraging helpful. as That's we And increasing the the in-store dining well surprising obviously off-premise. start to see it's Great. as

more for you that? mean, off-premise why of to you how doing So for dine-in. promote that's explain they square kind do think just that are Or Anything coming that? as I people you're maybe come more happening? help

Kent Taylor

Hey, Why him little kick Jerry, operations. don’t a you from the on color we go? ass on you just came give how

Jerry Morgan

I that confidence to and get And get still are people want about, anxious served. experience food, as more room Kent. amazing Thanks, Yes. and people want get To-Go And our feel our people would number they say we dining to out lifted, to that one, that, it's and capacities sales. going drive our as the be service. just and

communicate be then pick to waiting it we've easier. outdoor areas with their our done things make with some very X-way up. that them to food it our them windows So from and in a easy our we've installed to And texting it when in the of in technology be for to lot check standpoint able to makes to communicated guests corrals to come a convenience is for ready the and

not So the the of many, but experience, ease the only be will many driving pickup. things

Jake Bartlett

a question. last Tonya, And level margins. of That's Great. kind of then to negative XX% restaurant guidance having mentioned you assuming sales. from impact the XX%

those And -- to in that now. sales like level expect barely gauge 'XX seems it you do or a to trying So of levels? temporary that 'XX going mean, What there's you're at you you're margins to think of Just unique if you the could kind achieve negative do maybe think any having to you to cost impact levels? would recover bear if I 'XX? are what

Tonya Robinson

that's don't I there's No. would point think anything different. I out

in as down to restrictions think it sales. on in timing those increasing we the lot sales. see dining then comes And to it get just when comes you a lifted mix room as because those the of the far do it that, depends I as that 'XX really down of

see you even back get you sales, see to to If return margins we little dining room or on that's and don't sales a beyond. historic higher, those could the if potentially normal So dining really To-Go levels, in those room a to hold on because little where the that's where back that is go historical to level end of -- the the margins get those continue other see those high levels, To-Go on of we pressure but spectrum, bit a To-Go transaction a less more to there's little profitable. and

So the way it. of that's kind we see

have XXXX. costs expect We to throughout continue related to to COVID

we have We like to be of see continue away. costs, those expect to know -- And that when PPE business. go don't the part costs, supplies potentially maybe those those different things

Operator

have do Dennis the UBS. question We another of from Geiger line from

Dennis Geiger

kind focus over opportunity then digital and speak just was G&A I looking if to bigger just look you some couple off, that directionally? you commentary Maybe help the kind what a commented wondering that kind could at least any particularly out on, of like up and behind First or spend just the could frame opportunities wondering investment of if other as of the just you might of becomes these years, some investment. on that for of next of some folks initiatives? Or

Tonya Robinson

on hard this we and with definitely if Sure. other seen. pretty some have and what I But services G&A. the enhancements assets want continue depends software A in, silver that, that time, higher like been it's a lot investments, on of quickly to could things things that think will And this over some to impact like some those the Yes, that things, on moved of stay volumes all to investing see that. top and a we're lining through perhaps bit business that and of To-Go technology. we've we technology is versus of has

So continue I'm that we that to expecting happening. see

due we and Just an as to overall the of equity down a G&A, mentioned, piece XXXX just it, on cash is situation lower compensation. bit did big perspective I we quite from travel meetings. G&A facing, in see were And a

in looking XXXX. say kind spend of is you're So come be, what I goal a could of mean, G&A play to as And into back that our lot 'XX at will stays that piece of do because anticipate price. share compensation that mark. revenue will I be the that's around just you have by XXXX higher G&A, of it driven X% equity than it

model, have performance. on it's So that it's pop higher of the is our we'll additional back compensation a into likely that based bit in XXXX. it see 'XX, that, to and coming 'XX we'll A conference. than be in of related Outside whether was costs lot

be in -- my So of for a coming would will that top play back the are that will that that sure. down Dennis, of Those out, few I just in significantly think I call cost things can 'XX. was Those off pretty 'XX. head, into

Dennis Geiger

super sense? improving And kind time, just to see well of I framework upside historical consideration that the XX, even the the point But X back if maybe talking off-prem And from that that remains I going puts alone, makes of upside about That's off-prem that the elevated, of XX you framed contemplate kind detail sales that it scenario takes. piece XX the that just a I Tonya, you Or helpful. upside and just there? in margins? on on gave to margin based XX to if if back part and some lot over potentially maybe, framed, is just not and that more, to the does could of you rooms the to come could, think to fully on dining guess, and that the

Tonya Robinson

that's certainly but on. Yes. something It improving really specifically doesn't for in we're build profitability, the working anything

apps digital and Roadhouse, we're in sales. October. seen and We've Texas seeing those both a Bubba's app, our to digital and of our platform bigger our moved different digital orders Speaking apps -- a To-Go downloads more percentage of of to at we percentage online total as the a

talking with To-Go just the a help how that like, we how of about volume. what bit does we've do So quite can operators more I think transaction efficient, look level been higher we make that To-Go it

So it's in bit talking not higher. definitely something the a the maybe I talking be XX% when upside but a that think we're about, about or little bit margins in, I'm of little great built would necessarily

Jerry Morgan

are X,XXX in were we and now before than doing over averaging half, dining inside. experience less with To-Go full X,XXX, Remember, year the XX,XXX sales rooms a ago typically COVID

summer, think that able sales. if of To-Go -- so to people ordering be lot math, might you inside, before of this think maybe there's you seats as up seek for more are not we the later that make when To-Go hopefully, do such can a now come customers So or obviously, inside, want to that people whatever are then big weren't you

Operator

We do question Peter have from BTIG. the another from of line Saleh

Peter Saleh

I just this you Tonya, us plays through can the know year. sense on inflation? about give you a Give commodity sense on the out year? talked on us a cadence that X% the how

Tonya Robinson

Yes, to we than tough front locked be end a the it's We're on year to little of going tell. are little a Sure, more the on back. Peter. the

of So year. But QX spread higher half of QX and there's evenly tell year probably or XXXX, throughout back last levels Obviously, the year. you the it's less I'll in the visibility we inflation. had -- of pretty

be nothing would I But significant. out outside from to would of that some that a 'XX. that, it in level say So call that cadence would could go perspective lower of inflation that, mean

Peter Saleh

like -- about guys the the level just you inflation that environment also labor just then some high XXXX? in more inflation expect may And line taking, of overall of today? on environment unemployment be just labor labor and Can much sounded you with you the are year. guys the you expecting context seeing And you're this really in what it pricing talk and how the Great.

Tonya Robinson

shutdown, entering in and -- to to at When changes mean, versus went dining rooms It's the year, the Yes. inflation high employees March. we made was we wage we business wage to pandemic into that that those I really take some to say. minimum obviously, to continue to min To-Go tough of To-Go to with decision this wage. we tipped level some see working due of made decent

and increases, of in that. we've still piece so so expect place in whether difficult be, think So we're we thing that's to that a a coming continue seeing we're impact the in of of maybe drive anticipating labor it in your still market COVID expect just normal staffing, sort Through that about pretty that of pressure kept far. be state are and out or we'll those that XXXX nervous higher why the Still still and in seeing good 'XX. 'XX that a a little due could still as bit inflation we're little going folks X.X% to environment But 'XX. just to evaluate mandated XXXX, today whatever that's more might work, just to challenging to about do hiring and stays

dining So continue that's get higher think up, growth normal, I something with labor being things to labor we're growth definitely per percentage you'll store focused back that up. hours, dollar take and on. that, hours, week in filling growth in to like that that dollar, will see sales rooms But see

Operator

We have David from Tarantino Baird. from another of line the question

David Tarantino

restaurants of the the I has you more about question open. XX% that a Tonya, a or comment capacity about cohort had made of

sales sales. and XX% that's said you running are To-Go think a that I of around week, XX,XXX the

that that confirm correctly? can So you I heard

Tonya Robinson

do well, but X it's levels a data, lot were David. seeing into those those not That's XXX% comps sales what's weeks. sales. lot To-Go I they maintain are positively is about that Yes. of mean, weeks a us -- comp weeks some range. group right, and X To-Go for XXX I the believe, positive just that hard that capacity is does to And XX% in think first stores, It's that -- of read to we're X still that give I stores in comfort whole

David Tarantino

follow-up. Yes. was my be going to That

that's order you 'XX the the of guess, above weekly about I something system. did So they're that in X-or-so in what QX is it of -- for average on and percent $XXX,XXX sales, would doing imply

wondering, restaurants that's is capacity about do just And maybe good the think was kind gets rest performing, the levels? we that to those to see a for single-digits. way I mid- are precursor what of how when of comps a might to up high those system So you think

Tonya Robinson

Yes, works for how you're that That's right. absolutely those stores. -- math the of for group

said, XXX restaurants. it's I like course, Of

gives at some of that comfort the see it that's into to think try them can level, bucket assume for and that performing us when to going going what anything, means restaurants we we're to system the for capacity. we I of to granted, in rest extrapolate happen. But when they get that the never take that never

how see but we'll to see think well. those that definitely continue stores out, I play things good to doing

David Tarantino

type the And side? of the margin below is what seeing context in, you or margin of come on stores what they you -- you're for you those normalize I Are split then kind if volumes range once up XX% are they they guess if that that? could market? above any in out, running? Are what kind those XX%, question the structure that last of give

Tonya Robinson

that. Sure. on them that what I have me a to going things of don't but detail, are a margin would like like to guess perspective I depend a in would -- because labor of variety lot is states in front what and in it's from probably for I and outcomes venture looks that data

depending So steady cost on the of geography. really country. across pretty acts be across tends differently the the the that system, Labor sales to one is

that above group expectation. might definitely slightly probably you in So could have you even I below, there, right -- And XX. in above see that be stores that are some are group that my would think stores

David Tarantino

And I then X more. I guess have do

in be do On to the half to Or that and year how restaurant sequence encourage capacity? you the low for of more as of margins? expect build think the about the you year, margin margin guidance QX second for point get you this to the would us

Tonya Robinson

That would year. are that hope that things imply throughout getting say we the would because better

there's spike definitely where heading. that's expectation. that's found our -- fingers would if kind a states crossed, obviously depends as the things in and impactful. November, out we backwards, But direction if some that start So be of just lot we that walk A we're step is seeing

or perspective, be like don't tends Of But perspective sales from a QX and throughout have From better hope seasonality crystal definitely course, a higher-performing -- because things improve a the to a ball we year. to quarter see things know that. that. a

David Tarantino

below you So just would to be range? or be inside expect that QX to clear, range so that

Tonya Robinson

range. would QX inside to that I probably be expect

Operator

We do from line Credit Suisse. from Lauren the of question another Silberman have

Lauren Silberman

quick a correct? And Just all at XXX on-premise that or prior capacity on capacity. implied are also in Is year. the demand? or relative is XX% restaurants follow-up It on-premise function looks XXX% XX% to so about operating down like to the sales that a then of restrictions

Tonya Robinson

it And Yes, demand issue, be would -- how say capacity to numbers. a look Lauren, that at at would look those we as we restriction not a issue.

And place. necessarily bar that be that, having any mean that there's in could do still have and XXX% of have at doesn't because are you all manage some of So are you because they're still different have capacity, we capacity to things because then skip around longer restrictions seats believe wait like also the I to getting -- as times the that. that -- that that of mean, even restrictions we lifted they

a restriction of capacity more one. issue definitely a than So demand

Kent Taylor

you kitchen also that there to Jerry, because their This get and getting detail? back kind to in is on is Maybe, people have system time Kent. we I'd and so that say To-Go To-Go. slam explain can kitchen a in when more to when times we have computer push our little hard on we in of want are there a call our

Jerry Morgan

Well, it's basically how we control so that our it. kitchens can maintain

coming many expect how many how people in we room and many coming To-Go that So or orders the depending have dining on in. we how orders in are

as improve again, accepting handle So execution and have their execute probably bigger I more, to able find of and are few think just that And ability, window and sales, orders. restaurant definitely and our outstanding, very process, too. that capacity we them will we as each help our a most out be continue a to they that There's very, well.

little bit, a Kent. So that explains it I hope

Kent Taylor

understand they we'll it. I see. just I do, know, don't

Lauren Silberman

One labor more reform. about

Roadhouse as competitive advantage the expect that you to the minimum what could do wage, do to how tip well as are given just tips. prices employee to how as change and then So and company, specific labor the limiting industry credit, that, increase, pass? to through $XX consider think for a proposition should upside in will reform I'd presumably, teams you menu Or manage have the

Tonya Robinson

California, Well, doesn't we're there's in a already in that Arizona, specifically, doing country Colorado, already of those the a operating without a just a across higher some rates. tipped seen movement have wage, wage. the We Minnesota places of across that are lot country. wage run already handful tipped kind of of states we've that

that general, chime pretty continue in see impact there states. in field. higher out in and tell in Lauren, from those what we any seeing tip if jump can average And wage could in So servers I and sees well you're to the But an I'm we you, the in see get to out know Jerry, want is field? I to high. color their wage on They sure really don't those overall don't you Jerry I working. he tips mean, for

Jerry Morgan

are making when unknown. are of Tonya, than aspect. tip their agree, from money a they would it's I people they quite Again, bit If behaviors kind more maybe change people will that know today.

we'll the people to guest focus deliver -- no will on get a we inside paid to continuing make to obviously, legendary matter be outstanding, be that what this think people sure and that's model as and services building. continues And and So experience. place, that on I our what takes business gradually obviously, our adjust

Operator

question Oppenheimer. comes from of Brian the from Our next Bittner line

Brian Bittner

so lot more I some January can Tonya, weekly a maybe those what XX% portfolio you average the can average you've or provide stores far achieve far doing. are for in on capacity February have an that had -- talked us and that But so year-to-date? color know the to you've if just the portfolio the indoor give just sales? about more you us across just

Tonya Robinson

Sure.

over that have sales a live of in in work continue But our hard So our restaurants do. for me. to we numbers perspective. what in a maximize don't have had ways capacity of don't But operators can they're XX% of lot that PPA I capacity XX% details what stores really again, range. January, from to front XXX they that to find were doing I the bucket.

this that as to So utilizing as rooms different have seating they're anymore. in. page we remember, don't all bringing far those as and a people car. through system utilization lot in learning Because things, of text as the far just is waiting Everybody waiting

those think, Brian, of really I with. maximize they're they what Based the on as majority dealing can. But all them. as of things, much that's help them So

XX%, the then point. XX% as about We and is restaurants remainder down then we're of XX XX% still. the And everybody hope at to we in living and the -- have this think But of X down XXX% bucket have -- sitting that had capacity. primarily is otherwise, dining other This restaurants no some in just that I room capacity still helps. today, I those actually range. buckets, that

Brian Bittner

you're that very The it were No, doing you weekly does. that perfect. average XX% far in first you margin. of what similar throw so approaching 'XX, question your margin way. is And another sales were doing That's half to to year-to-date going I'm

in-store? we it full between the a for -- is ultimately, portion little the but all kind from mix difference lower do, to structure to of of To-Go I XX%, mix. is XX% close and and the of generates presumably, kind that you you as hard possible spread that's between know bit to just out parse being elevated, kind So really the that margin dive of your Can this perspective? more, and about and what think a margin into business that To-Go XX%

Tonya Robinson

does how from allocating costs To-Go buckets allocate that as Yes, on to do lot depends of as far the times, you're costs you're It you get of of those those a just right. anything things. into fixed rent, it side allocate complicated because over you pretty Sure. do any

To-Go could layer to from little So To-Go it probably higher out. hard little have the supplies. on of room Again, to have you you can bit on answer. you'll different get that To-Go. to perspective, different ways XX And tell higher probably split I To-Go, that labor in, Sunday course, PPA. and get a you cost a gap a PPA And $X then, does about a break between you those a dining there's

offset of other Now, costs some have that on transaction don't that. there's some To-Go might the you

that not areas that's what So piece and it’s really items difference, of we drives what's is attachment we're on bigger can that the beverage offering where PPA but And and having really difference. alcohol To-Go, focused something that on To-Go alcohol do opportunity our there.

rooms just equation that's really, are the neutral comes things your more to it at kind to So impact full, that does looking margins. what down To-Go works. the become when is, to really the there. those dining of of But some how point, And are we're

Operator

the have John do question Glass Stanley. line We Morgan from of another from

John Glass

of just that some effect those of average recoup it's and is to this kind Or sort ask now? you really, I and take some labor about you think To-Go? other right To-Go talked you're the Given opportunity back, could worth into guess, these experiencing transient, just of on is an of pricing is And increase? or pricing. going thought, coming price that's think there's have some the a about maybe that the First, than pressures, larger charge costs ever do -- You or doing? commodities, pricing? you What is I to thinking service that a not demand on question, about way

Kent Taylor

with baton this doing separate around country. in to different I'll No, start interested probably and at then the hand we're we charge service And have Tonya. a menus pricing different XX the not time.

baton be I'll then Tonya. expensive hand state might per the California, like and specific changes a more usually wages New those it the are to in and other costs what So the York and that states then AK, or

Tonya Robinson

the was really what consumer being But as it keeping I we're like, to we'll don't though, feel is much to like hear exactly those That's they conversations -- we that feeling. to mean, operators as good. John, It want depends our make for granted you is take say. were able consumer just specific ever we I can. to sure that them a certainly feels going be possibly menu good. with lot their we obviously, feels saying, The pricing. how And having take demand in Yes. like from value on the locations

looking will perspective, 'XX. we be About November. alcohol in you seeing basis across of is we going in that those the in so menu. operators then rolls X.X% of off roll and XX remaining pricing we're how And what some in off I’d country. at beverage now, the X% took points or September. pricing the feel pricing, That kind was to September the and have right opportunity that tell of So pricing from a about just

Operator

another the from Jeffrey have question of do from Bernstein line We Barclays.

Jeffrey Bernstein

it of like to estate so that maybe the maybe in X questions. have forward. any you then lately you or brands we to I'm would with of you're XX narrow openings, excited closures you've have XX increase on number? allow follow-up. about if wondering insight perspective X real on pretty glad year, real from guess, you color seemingly, Jaggers, now Any think about you there's historical that independent One, I seen what And X potential upside, the as estate But that's there's line like a whether seeing kind going much in the better that X looks starting to you're unit down, this were able year. or to sounds availability?

Kent Taylor

extremely gone estate I've doing have would Kent. And are some that What there us given there out we're additional markets is mentioned at smaller some some businesses look these are that some as that we we've yes, -- well before, in have locations. is This before. business of of found, real

costs are rise. -- However, to continue construction

without we things what the some in concrete, plumbing in and HVAC kind developing on And fill we then, cost so lumber, the would should get offset do be might save And of like you trades model, specifically and Jaggers, increases that electric. of cost then And Tonya, to then else? with even sites. on of the that, in we rent, added anything like construction, obviously, want if franchise pursue additional sales

Tonya Robinson

Yes, ready pipeline place. the right create the the over sure. got have I a now, a XX we to of just back-end we Yes, very think which under restaurants We've the looking loaded, XX risk. that getting open. think the more at feel to little But more it's construction good I year, little cadence about of does in course

in being which up XXXX. $X.X Roadhouse, million we higher 'XX able cost so far cost a came And the and okay. little Kent to get on standpoint compared with were of point where jobs at was for XXXX, bit being good from about just to a contracts, those contractors absolutely in development -- done right so the for the is Texas labor we supply the being

to building come Right of info costs will We down and little down the lot things cost definitely those we're a in mentioned, we those bids an a those think continue on eye Kent So a a the now, will to 'XX. getting to adding on costs keep we're little from offset that, think -- it. bit, things in come like but going perspective. we're those based

Jeffrey Bernstein

from that what the question can help biggest is on the the best to can broad, your then Jerry. I seen bring seems I'm system? broader level, regards. wondering restaurant bit your Kent it practices maybe broader And for at you system, the perspective, what you've take mean what a to question holds bring opportunities was are think like with little what that follow-up maybe high in you more but just Understood. you you the wondering a table, the share initial you

Jerry Morgan

I want to Roadies for employees and good and expectations XX an probably inside is how I for accomplish of and and we're help as hope Roadhouse a our restaurant environment a that guests run managing what people I've that my had the and XX and last standards that hustle is work to restaurants. our and years represent so with to understand provide that our as that pretty do and our opened I've to have they always partner and been results execute over market experience the so -- partner, a we I've And to success, at the trying an company. memorable

the feel hospitality really like I is do side. I So add the I value that that understand

accomplish are and kind are I'm of the when so when in as call people that. a that field, need phone team, the our we as out our well we support and that that able respect be that whenever represent they I'll And in joining where phone reach the so something a Louisville friend, friend that's that to in building can that center, as

departments a to or the able that our help a experience individual guest even execution So are valuable I'll vendor they Roadie, for partner. understand how I hope to the a be of

our So looking I the with to here for. -- if standards here when we're take mentality that and facility, here what food, it our highest people, comes service company to we're care in share that our of represent were to hope of to serve, we're you will

Kent Taylor

This the Thompson regionals are stellar job come from all like all to leading our and Kent. a operations year Doug in at also as of them COVID that have during really look did I'd grown. is throw and home operations

Nicholas], as dancing. As and butcher of ago. a one regional, matter actually was of regionals, [Neil a our then successful XX line for started fact, Smith, our another And father us, units some of one years our Mike new of the most

experience run in of very field. operations with people are that a driven and we operationally the So our have lot the

Operator

Our next question comes the Levy of from MKM from Brett Partners. line

Brett Levy

When those and think terms the you other? you customer, there, in in-house previously start difference both difference If that of on seeing margin are of -- using what or what And talk you any that are you only then seeing those have To-Go new about terms to how bit, we'll of guess, buckets seeing frequency, whether on seeing only X To-Go they're the terms a people What their Are of check to you in in the any X you I the customers? are To-Go? doing just their from behavior, X in really transitioned are little brand of in customer. you the could are them?

Kent Taylor

sales lose We cocktail This attacks the before in and that. typically do beverage restaurant. Tonya the Kent, the is sales

by sell court To-Go, To-Go. though to So in do we say, even when people are the allowed ordering To-Go. tea some we're And margaritas, iced markets, sell

Jerry, So question? that, comments that any on from

Jerry Morgan

were X you only. -- I Yes. mean, December, somewhat are of seeing down so. locked months -- of we I I think some beginning down. To-Go had are on XXX think -- we're mean, or about blend I you're X.X if here and And still again, the we a restaurants later, think to that depending it's states and now

standpoint. they still public I a safe stay of into to been and that get that precautious win trying folks lot how much places. that's are real think But So on from a there's

to when The To-Go execution. continues supportive of shifts up that we you definitely our But out sure be table, and the and it app, open Roadhouse things were sales the done of to it, your have that at sales. a and get very room home adjustment it unpack upgrade own been the execute that dollar how much is To-Go they table. we amount as drive when experience, growth of the that bottom-line experience home, at Texas the legendary want dining the there convenience be make our now food, the to well from room our that we the food But our So that to you as that presented happy packaging installation travels windows, of in all sitting it your in basis has of our when bag to in in aspect. serve home take you our that eating and you're has and just dinner at weekly on and people their well, food their and dining could our own

Tonya Robinson

online you, tell I'll that of Yes. And Brett, things, an side seen perspective, Tonya. we've is the digital ordering increase. this just from

sales normal the you XX% of been as when get you than that's prompted for I it's choices. that To-Go PPA think and higher PPA, you And is that see is app, of see And that's the you're course phenomenon just one think digital on much over XXXX. total climbing To-Go there of getting your pictures, of today. the nature as I

might you we something, pick like and different that. you If things give like hey, you, this too

those apps had we amount on a January. So tremendous in downloads of

to into gives calling comfortable So guests that us them you and see we're great have if really don't get more that and more apps I starting they're a way communicate with those using maybe the to think the restaurants.

would see of pretty all to think say that's that I us exciting So opportunity.

Brett Levy

cuts, but obviously, made front, some then woes, just will many the refinements. taken some you've sales margin on And you've cure

about could are level? walk real how happens just in will what won't the you're you what what sales takes thinking Where return? If return, us of the and through regardless puts

Tonya Robinson

Sure. I'll one that a give shot.

mean, I virus while mentioned around. If think see exposed stick PPE or for probably to perspective, happens COVID-related margin that's just virus, I you're we'll a expenses things the supplies those probably I to available we as have also earlier, line, they through the see to you're to probably On contract little see from our around. And that going COVID around going And what going and a to 'XX. I to is in employees. So like expect the stick XXXX. pay labor the related that stick a

other saw One as in of we the compensation. is increase on that of a percentage the cost sales, total increases which

operators, their restaurants. As you majority our of remember, on the a of lot all compensation our of of performance -- comes the based the

little So XXXX, little have And completely. we're on of. had a them make in bit more guarantee bonuses sure and that a we for more we'll were will during based and to hanging of of in -- bit actual seeing to they still 'XX, care guaranteed place then away there some But that bonuses results. probably in live taking return go

the of a kind couple thinking I'm of just of So that off top those the head. are of my things

To-Go will like on of hopefully, of things Those kind related helps. where are supplies depend And a seeing the can and dictate structure of. we think and Some level we just To-Go from things that, will labor continue few of that might the to what of be too. land cost see, some I sales costs To-Go of the a But perspective. we

Operator

another line have the Jeff from Haskett. Farmer question from do We of Gordon

Jeffrey Farmer

Tonya, you. clarifications for just of couple a

to level does spring that increase So price margin for that will to still beneficial restaurant be, that assume that I margin? XX% XXXX guess, -- XXXX, XX% XX% take place? XX% that, that restaurant-level the would is Or to

Tonya Robinson

just Jeff, models. a Yes, as placeholder our in

than assume bit assuming anything are as a in later that year, increase the second Yes. a like assuming placeholder. on in a not assumptions mid amount Not price or little at Other making that, not all, any big a bit little QX. we're but it We there. of does pricing a

Jeffrey Farmer

That's G&A. helpful. And clarification detail little a then more bit just a on probably and

So were XXXX indicating be dollars higher. that I would you think G&A

I think you XXXX said dollars.

which rather mean if that I assume number you did us clarify dollar so, were G&A of there have about some one-time Because are And want expenses using? some just to might I than XXXX, talking So pulled think you we're XXXX that you XXXX, if did. there in what out?

Tonya Robinson

Yes.

looking I'm XXXX. at So reported G&A for dollars

is So to that $XXX we're on number, just sure same over make the a million. all little page

from for it week that top head have at of cost does extra is looking the perspective. is of kind my I that is remember you're but I'm of off -- XXXX extra in benefit the is the I'm the right, in sorry, one-off there. And that week it additional XXXX, the of So the

Jeffrey Farmer

Okay.

million? $XXX now, at that probably be So at to just at will least you're be XXXX, level that clear, right of thinking level high least

Tonya Robinson

again on piece shares, based is big age part compensation, price. grant a of that our which And that's that equity based on PSUs, are performance Yes. of share the performance compensation involves

that. did we early in January, So grant We those this January a year. on had

cost of piece a driving up. that's big that what's So additional

Operator

from the question of Andrew BMO. Strelzik Another line from

Andrew Strelzik

And a Or franchise of I costs that unit optimism I'm just the positive XX% locations, impacting this guiding of believe growth. some back as think I below then you something year, there to go to where kind if kind time Jaggers opening number? get that. years of I know as curious, we on question broadly, had I'm function you openings. numbers we be well, a but in international is talked and just slightly more now you of would a that think there construction just is several the quarter, that typical curious lot out? you really obviously, that's of commentary And could some unit and Bubba's hope there. think that company-owned around you're kind of unit the And nuance last that But about? said other over

Kent Taylor

we believe I for you the few Tonya, continue on smaller page I accounts a I can years. is number, might This quite me. you more next give Kent. think, exact this but that those spank based a

I'll back So off.

Tonya Robinson

Well, XX mean goals came and Andrew. when open XXXX. I'll into had I in of we we you, XXXX, tell restaurants getting

trigger a this global think of opened of for So to XX obviously, on were XXXX. kind XX pull for we we fact were that proud the I during very -- but pandemic, we got the ready year

middle XX And the to a that of a is cost. cost, just of more pipeline are isn't this It's in in what 'XX XX looks So we really like. it of the pandemic. of function kind function still higher and

taking because consideration opening we're other into XXXX. is things So the got bit and piece works in -- teams, already little finding work just But that pipeline all people, the finding that good. through a making we've moderating a the sites, management finding is you're of the XXXX, when restaurants it, sure the

that partner and covered so and that's just predicated definitely is something we time team. restaurant because of that that we're make lot managing of management And sure a spend the so that on on success

themselves function of costs the So that. for really development not costs, a the

Operator

We line from do the have another Barish Andy Jefferies. question from of

Andrew Barish

As I the at got end, guess. the We

I I the of of guys few middle pandemic that's the environment Is pricing. with the you the quarter. Just a than first take From with leading what push that kind now to external usually -- mean, obviously, other recall, in a anything in on mean, it on out about a you I follow-up kind months? follow-up there the uncertainty going of

Tonya Robinson

restaurants with we pricing that on printing a uncertainty Tonya. as little it those of time lot you adds process for then menu would than given all with getting that what a with and obviously, No. process the the to that mentioned. things. as those -- out Nothing far go conversations and just through of November, And December December, reopen just when rolling is going done. operators, the we This of those having other given had

it. pushes what would done March. more in March, usually Andy, it in later And we that's typically, get So

it's So push a potentially, could a be yes, will about operators us. the months, X-month the it give it and X.X depend is they and about on and -- a lot, again, feedback

Andrew Barish

Did weather, I And side, on not gift assume, use through the benefit other the week this the that. numbers, then of data? quick know cards. from questions a just cards the out on you Excellent. rolled And had some weird is in then the it's but new is it? to obviously you I gift Holiday ability app. week's see with first couple guys Or year, that? app a X year-to-date the on

Tonya Robinson

number X-week have been the would through Well, Yes. Tuesday.

weekend over of We negative some from think that the that's have impact. does we the impact of Valentine's why it that it's the Day the saw Day So weather And separately of the weather and kind to shifting Valentine's of weekend. mix is impact. a hard weather Day Valentine's quantify

a of So that then from of didn't looking that I'm question sorry, if little kind answer, what piece at perspective. we're there And both apologize. is I was that bit of there another I

Andrew Barish

usually cards Just nice guys that's ahead. holiday how of a bump you saw go and -- kind gift and then into you moving year, this

Tonya Robinson

Yes, absolutely.

the to mean, really pretty our operators came and goals everything we we is up goals. those that our was shy went goal. the of X in our us I I didn't a given big, year, for little we And season mean, card -- card weeks big are it. leading gift of But end yes, So awesome. killed through, it gift

we on saw you're tailed the didn't right, redeem that those helped app kind of so that redemptions. Those happening. with October, use, has app have ability starting to and we throughout in definitely XXXX ability, that we and And up continue pick card because is mobile the having really see had of off rollout that to gift

Operator

Sachs. line Goldman from from the We Jared do of another Garber have question

Jared Garber

in are where wood, But managing kitchen orders? good bit of how about higher rooms again, you an throttling the earlier of dining those talked a Jerry, kitchen to those full little thinking question get maybe to orders. to To-Go To-Go it wanted in Just environment things knock some of capacity and is are question on level this you online terms capacity. a a ask back for about essentially normal or as sustain And you about

Jerry Morgan

Yes.

negatively approach at how the peak think especially to so the when affected. during number day-to-day hours, need basis is -- balance I look of be not that -- execution to and a continue on just able we'll take that's we that to

has if they to about up get most lot a New down down. and that open can -- we've of or they that as can I New we The a can effectively So not especially Year's the up some learned throttle learn control holidays caught got do and and window he the Eve to even control in -- think and have or we operator just ability actually Valentine's to how when sorry, Year restaurant up or it. they it during that or has shrink -- little bit, Christmas the use and it I'm Day to

at. to things I are we dollar we tell that better lose they that to something you, shutting accustomed the down get really are continuing can sharp they that every want sales. it's where operators so potential So would to to get they're not

have total all and that every out fantastic managing to maximize minutes coming we and figure regionals XX in. the in of our So to I confidence partners Doug how orders have

and I the us it it's road So be the getting keep more our at tool to will to that a top. operational accustomed excellence think definitely or down we're help to, to going used

Operator

from line another have Vaccaro of Brian question from the We James. Raymond

Brian Vaccaro

XQ for as the eye and and were can of the an your in check between give well. spirit hours time's you traffic sake and guess traffic I in dynamics relationship the company Tonya, on keeping old maybe what units?

Tonya Robinson

Sure.

increase So in decrease that X.X% comp sales, that X.X% of number. in part check on as

So you've of the X.X% mix, pricing. is the positive remainder that then got and X% Yes. is pricing,

Brian Vaccaro

guess And back store I margins. on circling

in hear during can week range that the your to some said million there? online Or there if store just did help bringing sales certain cost margins some that per And line quarter-to-date us guess, cut $XXX that members quarter-to-date then you're XX% OpEx maybe labor accelerate period? that into I are of maybe perspective back some were correctly? are team back XXXX, that with more bringing range. you how give the your that seen I so, other in costs XX% sort think other as color you are first, I in you've on costs

Tonya Robinson

And data. as to not is I group, Brian. big X obviously, weeks I a just careful really because, want earlier, of Sure, be X weeks right, said

perspective. much of look want I weeks to better So into margin at from a to XX that and perspective, that careful a it's reading too from be

have just we bucket that the that restaurants think down going a those weigh XX% comping lot want you I of are caution. to out word who of see of restrictions, positively, to that those kind still bit. I stores’ numbers So say in think And margins said, what that's XXX% have XXX well, as that to are a and but a you performing stores there

you may the hours some percentage. And Because benefit grow as higher positive, see going not see more you're They being the sure. from on get but help XX% you dining see starting I you're when room. hours more. those the to -- that labor a for sales benefit or get going you're think but are that going think labor be going you're going higher to margin to to where hours going utilized line, growth line to in that's see sales, to on upside XX% to to to about -- to see with in you

you're Again, that cost might. And rent the anything other that, point shouldn't So benefit out other I else that's of from But I where and really too or sales to Obviously, operating to get those would sales much. probably you're fluctuate of impact. going to. say some see would line on bigger on operating higher isn't outside there going that call line.

Operator

are to like you, further turn would no management call this time. for back closing the There at the I questions Thank to remarks. sir.

Tonya Robinson

with you, this is of safe everyone for I joining everyone, tonight. staying Thank all the Annie, and country. us thanks, Yes. on weather going hope crazy across

any information, Thanks night. much. out Have other so to need don't a to good hesitate us. you If reach

Operator

today's this Ladies gentlemen, and concludes conference call.

Thank you participating. disconnect. now may for You

day. have good a You

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