Darden Restaurants (DRI) 24 Mar 222022 Q3 Earnings call transcript

Company Profile

Participants

Kevin Kalicak	Investor Relations
Gene Lee	Chairman & Chief Executive Officer
Rick Cardenas	President & Chief Operating Officer
Raj Vennam	Chief Financial Officer
David Tarantino	Baird
Brian Bittner	Oppenheimer & Company
Brett Levy	MKM Partner
John Glass	Morgan Stanley
Brian Mullan	Deutsche Bank
Peter Saleh	BTIG
Jeffrey Bernstein	Barclays
Dennis Geiger	UBS
Chris O'Cull	Stifel
Eric Gonzalez	KeyBanc Capital Markets
Andy Barish	Jefferies
Nicole Miller	Piper Sandler
Andrew Charles	Cowen
Lauren Silberman	Credit Suisse
Chris Carril	RBC Capital Markets
John Ivankoe	JPMorgan
David Palmer	Evercore ISI
Jared Garber	Goldman Sachs
Jake Bartlett	Truist Securities
Nick Setyan	Wedbush Securities

Call transcript

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Operator

Welcome to the Darden Fiscal Year 2022 Third Quarter Earnings Call.

Your lines have been placed on listen-only until the question-and-answer session. [Operator Instructions] The conference is being recorded.

If you have any objections, please disconnect at this time. I will now turn the call over to Mr. Kalicak. Kevin you. Thank

begin. You may

Kevin Kalicak

Jess, for and and you, morning, good on today's you participating thank call. Thank everyone,

Joining me and on Chairman the call today are Rick President CFO. and Gene Cardenas, and Vennam, COO; Raj CEO; Lee, Darden's

a and as in of uncertainties cause statements XXXX. that comments include Reform are statements Securities defined during call could the this As expectations will reminder, which subject forward-looking These and the Litigation actual distributed Private projections. Act made to risks results from to in in release, differ are the Exchange and company's morning our press with Securities was materially this described filings Commission. Those its and risks

Raj update and detail comments. will brief during remarks, Gene to more plan will quarter XX, quarter We Relations share some performance, not when outlook, presentation have the fourth XXXX non-GAAP results Rick morning, is to and measurements, will the are operated pre-COVID fiscal third Any XXXX. market are which Investor of business section fiscal opens, call, on of measurements this and to financial and reconciliations will the then our We of some provide includes certain operating the of update the give discussing before darden.com. our a we that earnings because on environment included conference fiscal simultaneously and quarter presentation. a our presentation our these to in This call. in to website limited reference is financial XXXX an the on This during discussion capacity meaningful Gene on closing results pandemic's the an the XXXX. is posted fiscal are third June a in impact release third quarter comparison Thursday, at broadcasting year's due followed last by performance Today's

Gene. call Now, over I'll to the turn

Gene Lee

Thank morning, you, everyone. good Kevin, and

environment. highly performance with stark Our and I'm of this third quarter contrast, in pleased volatile our was one

a December, profit did provided job sales could In they in fiscal our team internal December. that in Our the we expectations control. contemplated record achieved meeting great we were what controlling while guidance

period operating However, which significantly and in fiscal us, expenses. staffing impacted a the variant demand, consumer for restaurant is Omicron January, high-volume

substantial earnings weather lower our resulted internal We which in also significantly all sales impacts, of than experienced and expectations.

we COVID our as results we sales of strong slightly that trends last operating in and and cases throughout our December, February, continued have declined expectations. sales on predicted the has average Omicron our incorporated Finally, impacts talked and internal Sales the actuals, our improved weekly are could these had guidance. March. business. environment Quarter-to-date, are strength our exceeded into February fiscal we have not When ahead in would normalized,

spike spike COVID level ago. December. in cases the will on overtime when shortages staffing levels in create also by more In exclusions. we now at a levels moment. than caused we and to due expect years fact, impact details the in the provide the two onset difficult also environment operating pressure dramatic on initial the had created of additional since expenses most it Rick our Omicron on costs as saw higher of pay January we supply to in QX sick and staffing significant The we restaurant talked disruptions, caused further be chain higher inflation incurred

supply and his We the us will remarks. Raj the geopolitical the faced implemented of additional such environment more inflation due to in recognize costs, mitigate disruptions. provide have higher further actions and all pricing current rising as of industry that impacts chain to risk We in detail

I'm Darden However, effectively any in compete that operating can confident environment.

operating relentlessly scale, competitive results-oriented focused And extensive in driven and atmosphere. brands of back-to-basics insights, place, our food, significant our philosophy balance right culture. We advantages and have by a our planning, rigorous service, the anchored four strong and are sheet in data strategic on and strategy executing our

Now, it I'll Rick. turn to over

Rick Cardenas

and everyone. good Gene morning, Thanks

for exceptional takes are expect creating From to focused choose positive they people numbers, to are of executing we of level need products have applicant the where every the our highest and feel That's dine when are a it staffing. teams guests perspective, people now restaurant us. and in better the about in at on Our terms our we overall one to what with we much guests. in committed momentum experiences doing are we seeing we why

importantly, be required our productivity to the team more staffing level new levels. at Our to hiring optimum on focus reach enable to members operate training will continue to and us

was To provide quarter monthly member during member Delta. the the due three Our context, peak, at team and of the were exclusions manager peak biggest January exclusions staffing than in with some experienced managing the we times impacts Omicron. challenge higher to team

While a some for finer total of on X% our help to point put January. we guidelines CDC excluded the from did were some at reduced get during point as days, five To exclusion XX was workforce over our managed January, total XX,XXX had for team month XX,XXX impacts proud the Omicron. teams of than I how in we a of the days. excluded more really this, of am through of exclusion members

were moved we only to as order operate that were moved restaurants across some country, much the as effectively. others to staff needed XX% takeout limit their their down to As had that temporarily and in hours of it

testament the to our on record great fade, across teams and that to strong our Day their a to provide is of staffed level doing are operators restaurants ensure kept fiscal was which training experience, job for same ready sales to all Valentine's focus our are and guest a guests. excellent brands, and serve February. to resulted As Omicron staffing our the began in

guests off-premise. approximately Valentine's Olive million more than Garden served XX% X In with of fact, Day, sales on

leveraging the to scale side, supply team working ensure restaurants our guests. chain need product our the is hard On they have serve our to our products

challenges remained and improve with strong been levels December. had in of inventory to logistical some Our began dealing the we

However, chain our as supply Omicron impacted staffing in well. January for partners

and the holiday down season. buying cost supply in this For at reduced a prices shift protein resulted when increased labor heavy intensive from time food typically production,

winter distribution Garden in those Between partners shipping and also spot impacts warehouse with staffing of experienced the and and quarter total and challenges Longhorn dealing Thus, total at XX% for quarter. sales accounted these Steakhouse. admirable costs our rate strength more transactions of of our Darden's in on will for we an increased the sales off-premise sales of annual color factors restaurants. job driver and To of sales. benefit utilized sales the supply sales at of Off-premise provide storms, remained all expected as our more XX% Go XX% quarter during our continuity back-to-back to our platform. during had that a Olive total Raj shortages. moment. maintaining Our did expedited inflation, Together, strong for accounted the guests and from Digital team and haulers all digital continue XX% our of brand

in with end and incredible with members a guest continue I our hopeful tremendous multiple dedication will we Before with it turn dining while are to be demonstrate Today, to to we that constant have creating years flexibility experiences. like COVID when resiliency and know as perseverance viruses. face able would all did other near then, thank our change. over have pandemic and and Since reopen that of be live waves, we we able the not our team room who are I closed ago, Two of shown of exceptional and Raj, we want the teams we to we them. COVID-XX do to the dealt

has energy I with are that and a team invigorated restaurants they dining talk feels the they members, As each and visit by little our room. our returned normal, our day say more to

their by are I'm team that spirit Our ahead confident the days members are best the inspired best us. winning in Darden's of and business.

I'll to Now turn Raj. over it

Raj Vennam

and Thank Rick, everyone. you, good morning,

sales contemplated expectations were February. met in cases provided profitability months, fiscal shortages on and profitability of our financial want increased Omicron on we Rick's comments and to December February causing were results results. COVID the quarter, demand. sales significantly and actual and below our December close When our expectations for winter our our we expand in and that looking Before third get them and Gene in however, internal impact regarding the exceeded And I as the to into December. January, staffing reduced in were at expectations quarter In outlook surge, weather we I for the fiscal

We also than averages. historical weather severe winter experienced more

a over points quarter. This sales by overtime million. sick to negatively related increased sales expenses negatively EBITDA additional was for with were basis impacted this and $XXX margins As pay, approximately inflation, impacted than coupled $X.XX down, result, drag on XXX by a and slowdown, EPS more

Total the the new turning than XX in earnings last XX.X%, than higher driven were were growth to restaurants. for EBITDA basis from for by same-restaurant sales per XX EBITDA $X.X $X.XX. margin net was billion, the addition quarter share XX% million, third detailed operations continuing better of quarter. Total results points $XXX Now XX% year, net resulting Diluted and sales pre-COVID. of

cash dividends balance cash to $XXX of with $XXX million of $XXX to paying on $XXX over in investors a million We total for million sheet. the the continue shareholders, million quarter to in return We returned in and significant ended quarter. cash shares the repurchasing

with with previous higher this see than was quarter, expectations. to continue We our which inflation inflation increasing cost -- pressure total X% of

guests. taking preserve last of As and additional business the implemented actions model our further while the additional our have we to third balancing also mentioned began pricing strength quarter, I in the quarter to impact

X% quarter, our For last to for pricing the year. we compared fourth be third quarter, total and pricing to approximately was X.X% the expect

As of continue expectations updated position. strengthen as be for a we fiscal below total result, well we our This pricing pricing the below to overall full year. is just over strategy of X% value inflation our the to for expect now execute our X% leadership to year inflation

quarter. performance to segment for and P&L Turning third the our

more in we've business we We normal comparable opportunity. framing with are how against our been margin pre-COVID believe are comparing of XXXX, quarter expansion third which to the operations and results

quality, higher, size For the investments were as as commodities elevated food driven well expenses third beverage pricing significantly points inflation. in food below by basis quarter, and portion XXX inflation and

sick quarter to was in this as than December Omicron. inflation did were was just better XX and overtime points spend pre-COVID points inflation, the was a as Restaurant was of as continue $XX favorability. inflation higher, controllable from fiscal over Omicron. commodity and of of teams XX Restaurant points wage our expenses. February by lower, basis result headwinds in labor pay expenses percent Marketing labor expense during quarter Restaurant same XXX scale wage of a X%. these months experience resulting higher not Our million XX%. basis driven sales as Hourly lower, was manage basis the

result, As levels a was the restaurant-level for Darden XX.X%, pre-COVID below for quarter. XX basis points EBITDA margin

expenses, to EBITDA from savings and by sales a was the expense However, both travel compared decrease in December XXXX, margins mark-to-market and XXX restructuring almost lower, XX corporate February, grew basis fiscal driven leverage. points by expense, G&A pre-COVID. restaurant-level points in basis lower in

segment Turning performance. margins of segment our to last segments. increased profit year for all versus our significantly Sales and

As we to to Garden, segments, is the Garden case from compare slightly geographic it Olive sales. guest because Olive Garden cases. to were than sensitive disproportionate and more impact make grew due other experienced pre-COVID, This footprint Garden's increase all COVID significant Olive in sales demographics counts. lower Olive COVID

continues pre-COVID. impact earlier from Omicron less promotional growth which Garden a quarter profit and the of lower experiencing sales Olive marketing all pre-COVID. in when relative significantly comparing I to margin discussed to activity, in to January Additionally, headwind resulted to our have segments segment is The

than sales restaurant XX% We to inflation our approximately between our year-to-date quarter. growth commodities with of driven inflation We inflation X% the performance spending expected capital to now and hourly and same-restaurant $X.XX X%; growth outlook updated between quarter fourth of our and EBITDA to between higher average labor implies EPS diluted of which inflation million we $X.XX and expect full and per XXX outlook fiscal tax for XXXX. expected effective contemplated between December. sales billion; the approximately million; approximately $X.XX basis billion $X.XX. roughly of restaurants; all pre-COVID XXX $X.XX approximately of in annual versus XX% what of net year includes provided an the our outlook X% share points, performance and new reflect total turning billion range. for $X.XX total within implies is $X.XX also in our billion This full by was XX total shares and margin year, and approximately still $X.XX in approximately EBITDA of earnings resulting XX.X%; previous $X.XX, outlook X%, billion wage approaching fourth to to billion, This and Finally, year X.X%, outstanding diluted rate previous the $XXX for of sales financial $X.XX which for outlook

is weekly incorporated February, sales and ahead average said, guidance. this quarter-to-date that in are our of As Gene slightly

Looking a forward for providing to fiscal some preliminary XXXX, items. guidance we're few

units capital XXXX. project fiscal million. $XXX XXXX. open between We new anticipate of total tax We approximately million to effective in and rate spending an $XXX XX% fiscal expect We XX for approximately

Gene. it to Now, I'll turn back

Gene Lee

Thanks, earnings Darden. Raj. This my leading morning call marked my XXst and in final years

all support who who for didn't So us, well. ability analysts thank our you for us, execute. And us, vision to our of believing you in the you as always thank believe and those

motivated as in company. in role know. all lessons a and they I but kid learned lot the by began have shared over career, busting our years of one for together, lifeblood trust me. I you year. I've will a Darden. our the ever You of served shown table. our more in or whether our this restaurants members to meeting And shareholders dinners I journey ago you finally, look the team as a and to restaurants school my the for high group many us me as it's principles you than in of investing our I center will we miss the time throughout two new thank forward to seeing have one-on-one guiding for Chair. thank my support meeting, in XX a our want particular

critical to comes good sure it and team those members to When you when both stakeholders First, guests decision. making two have decisions, win. a it's win, make your

who the it Second, simple serve is have Nance successful [ph] must outstanding a atmosphere. business this simple an The restaurant Malcolm but great food industry, engaging hard. people is restaurant consistently and To business. be you said in is simple, best.

back-to-basics I my may intense philosophy, require running operating So fundamentals. will always on the bored you great with have restaurants focus

up his do is new job. ready great into set Rick Darden to As will I is transition and success. team my he Chair, role confident as the company, for lead I'm a and

up it open we'll Now, questions. for

Operator

Baird. Tarantino you. our with David first We'll [Operator take Instructions] Thank question from

Your please open, line ahead. is go

David Tarantino

do I morning. previously good environment in that fiscal you're move in to year, pre-COVID think inflation to you you're Hi, question to had think And you outlook, levels. or beyond year. the relative that is this given range XXX it the But you the to you forward-looking the do margin of XXX facing. to like still as that as you into about the think going points guided about needs And on My margin basis change? for play think XXXX, inflation looks outlook you comment as about is think expansion fiscal

Raj Vennam

morning, David. is Hi Good Raj. this

year the let bit we today So, a only at about to are, X% X% me and our quarters the things different. very year, back quite just we how inflation, talk relative the And obviously, inflation step pricing is total closer changed the by started looking up and has three environment margins. When year we We to pricing here assumption X.X%. from gone in, began we're about and X.X%. have started with

still to that full are basis X% and year points. started we now to X.X% the XXX able we're So, over just with and for get

by fiscal I getting end We'll how we of terms year. really June year. situation we for good we're we think are current of But to this the where feel environment, in expect the in XXXX. we fiscal details in, considering to share about where this feel more about in good thinking we're call be about the So,

David Tarantino

follow-up Got on a it. just And that. then

very about bit with you guess a absorb fourth couple the I feel ability preserve to at like level are being that what And of do you're the : arrive said up very We take flexibility. we've pricing? over quarters and pricing. consumers' done X%. quarter wanted pricing? sounds actually we've we back years, how much to in that little few Yes, more did to -- the wanted decision taken look leaning You to -- pricing all on to that you last we think the if I pricing of along you how last actually We the conservatively. approach

trying as been we've off where much are the And would have now on X%. And I is so we think dictated. inflation to as pricing hold

the below try up, below. pricing as creeps I we're initiatives. year, While a have to considering And we going we're pricing this that, XXX for continue Obviously, two in -- and to of don't of years, combination opportunities And look much. think X% manage we it's terms inflation. price it's like to but we're to we're pricing to considering seems what high price, too earlier, inflation environment said going historically how productivity through on over be to to going and

David Tarantino

Great. Thank Gene, CEO. again as you. And on a congrats run great

Gene Lee

Thank you, David.

Operator

Oppenheimer Company. to next & go We'll Bittner with Brian

Your line open. ahead. go is Please

Brian Bittner

here We a surging, seem increasingly at when Congratulations, time are time about doing a guidance, comments and based be investors your not gas Thank prices to strong implied concerned to on Gene. based outlook and in on which lapping so impacting your trends. morning. be very when sitting and are stimulus you. operators Good around this March the point at does and seem revenue XQ implies

comment why it. out you to maybe Darden to just can And on be environment seems the prone there? So, not

Gene Lee

Brian, I think Gene. -- this is

comment, I of X% at level pricing too. than the here, that around end in I'll But the think our and the one higher that. let -- is increasing that wage are gives pricing lower things rate us to increasing jump Rick one confidence

almost labor. digit at you seeing when look our double we're So direct

country is we that rising So throughout rate. believe wage pretty at rapid inflation the a

based increasing the impacting to this end. a as environments where more in be operated are other very can demand lot we're on we pretty lot is what consumer so we've the that here. today, on and especially right lower things And environment where But shift The so can past, strong. consumer, seems the right? consumer quickly now today remains on but fairly are seeing handle of headwinds than rapidly believe different And that wages environment us that of the

Rick Cardenas

And environment. Brian. to I'll add the Yeah, current

As our going long about but fact you going first Ukraine, on the say is all, how think conflict the with of people want thoughts to and of the last. in Ukraine, to what's know are prayers don't I we is

environment We're confident our environment. And to any know long focused we we anything manage operating the that's itself. how our effectively business in controlling to don't to control, going so ability in do on what can

The is from XX-ish%, supply about restaurant XX% other think pre-COVID. thing is down to

great do gives are that that and options, to so go for out, option people them. go And out, a and to people fewer want we want

thing last our of because then and would And -- it just in the little little the good guidance just notice So the say a we that end. wider bit bigger gave because quarter just uncertainty that's than normally bit be range we going that through is feel you'll guidance feeling, I'll range is but of a what we're we're a today. gave. about We at

Brian Bittner

Great. Thank and Gene you Rick.

Operator

next Partner. Brett MKM go to We'll Levy,

is Please line Your go ahead. open.

Brett Levy

to quarters? think think to to you can the about six technology? newness next, Thanks. really say, few versus the Great. to we can -- your Thanks be over what the want of implement the surely come two and for as comments years in you about inflation, with taking to the model all the and pressures your will terms stay what shortages, front-footed? consumer, conservative rising controllables missed you we challenging How monitor of should of over we'll labor on productivity the how need on next all times. When we you should question, operating How the about in drive out these be more think of of Gene, menu your terms

Rick Cardenas

question. Hey, couple on a that of Brett, it's Rick. things And

ease restaurant friction and So the that the across to and a out same anticipate friction to is It's full want that technology we this wherever is, of a believe interaction. to people on growing because goal. implementing chain, the guest technology value system service full-service and personalization. company, we for human reduces consumers responding We the don't technology that using have continue front; take

provide can add we dishes and make guests them. want better. and another In reduction produce it's take want the teams for with we clear new get our we item the our high-value at continue terms of off. they in they that to it And done dishes that menu, we've been what really items, to we easier If like to menu

very on to And going down. they percentage are so we're menus up be stay sure or today within consistent the our making at small a levels

that much think time. On future be the that as forward, as But about we we get still some is from controllables going in our costs We of where think front, expect some But sales about the it XX today. we talk be margin as coming productivity, over don't think about if XXXX. years going June of long-term will in to would about got margin and we to look two to more very have but project we margin to framework moving it years. just We'll that you think was our had, is we points about improvement. seven we've fiscal -- in improvement basis XX

so we've we that the last have we sure that to make consider over made improvement that manage and And margin years. of couple

Brett Levy

of And right just of for seen value, pursuit either quick When guess, any you higher-value by across consumers Garden, you and consolidated? then one the think in the LongHorn your mix, the movement a mix have then now material the Olive by just I to about follow-up. product shifting

Rick Cardenas

any No, movement. seen Brett, we haven't

Brett Levy

Thank you.

Operator

Morgan We'll move Glass to next John Stanley. with

go Your open. Please line is ahead.

John Glass

you any of Gene. Hi, I bored morning, don't us. thanks. Good think

us a taught industry. all actually, you lot about the think, I

too On deck given about volatility? on know May. at through provided of you've for Raj, early Do item? have visibility, you on the or least beyond the thank do that. I XXXX So guess, you the specifically, that -- some Do think on have I contract any you you it's the commodities expense sort that, into here insight

Raj Vennam

to starting have obviously are conversations. we John,

premiums working we're are the But that have we'll to -- next -- forward those would we're high in and have contract we situation, far. few less say, historical to months, contracted more are to I probably too a the through share over -- from We and compared June.

John Glass

that to about How consumer to preparing thinking alternative consumer if start with some to expect? tactics is revisit Do fact, that. just related are weaker can to than the your momentum? to marketing in that you tolerate could tactics pricing, are you about spend your Are employ what in come in the continue starting how the you just you you sales thoughts for you up broadly promotional consumer And pricing the are if, then plans weaken? you Thank the comments business? 'XX? And about your you of the demand think starts and

Rick Cardenas

John, If Hey, then will slows they question. what down, talk for we're it's contingency Thanks the we've are. Rick. won't the the say anything. to stays much too talk XXXX. we're going I plans. strong, not economy plans We what I about we'll But If for say, economy will got we've continue got some doing. about

we so do. until want we what where And see we don't is, comment what is and really to on that it would

John Glass

Okay. Thank you.

Operator

go to at Mullan Brian We'll Deutsche Bank. next

Your open. go line Please ahead. is

Brian Mullan

thank color fiscal XXXX. for development Hey, on the you. Thanks

competition building you how other a to wondering sites? on seeing if out when from site basis. there Just anything out what it casual perspective. COVID diners pipeline for or beyond how that you're environment And multiyear at prior force a was versus hear more the speak notable large your same is be could that you different were Are looking thoughts to Just these seeing going chain great restaurants. on would there that to

Rick Cardenas

closer Hey, long-term like end to for of before, in XXXX framework continuing said build fiscal the our And get Brian, to and we're the as higher future. pipeline we'd we've our to beyond.

are competing there competing many are and as people As brands competition aren't we for site. that still growing sites, we're there for seeing but out sites, seeing for

that, to continue I some rate. they're through. brands restaurant sites. building at as we those to build stay pipeline, will so over some are just of some brands to and to great sites. for some economical the didn't compete Those we add continue really will and converting say, our And sites an we And taking

And So there, that we'll enough. we'll improved offsetting continue much so have to to by our business still has build inflation but we feel model our that pipeline. continue that some more our is in build good pipeline. We cost than

Brian Mullan

Thank you.

Operator

of Peter next We'll go BTIG. to Saleh

go Please open. is line Your ahead.

Peter Saleh

people units and a taking again, mentioned the quarters question think, competitive congrats in inflationary terms but Great. category speculation has that? fairly it down and opening I of Thanks. subside in a of of environment ago, there versus development, bit? seeing and XX% for environment about that Gene. still were you in made dining pushed Gene, you or out kind a Thanks I the little restaurants. up several still the that -- was, little pre-pandemic, seeing still Is casual bit fewer think there you Are that had lot the

Gene Lee

Yes.

I think that lot and and were by trying especially there back I willing then leave back the real if a go REITs the that big was of take it some and what -- less. of costs some out carry vacant was a you to speculation, there estate was say were to for on while

people to less in We any estate haven't seen the buildings for likely less be allow rise, there'll real would and change a period sit be of that. market real will My to speculation expectation in dark be, as interest their time. rates

lot of a players opportunity. Darden look most sign competition out there United day, the -- of a it put on a At regional get space. want the make Rick their we the our There's property. work, for competing. smaller the there maximize And We -- we'll pipeline. there lease of out out so, a the landlords the end there, signature in we're competing said before, lot prior as building guarantee There's question, restaurants on out it. chain most not get to estate we'll can to at brand and to there first we try States, right going we're And if the look and at to of real in

Peter Saleh

XXXX, development much Cheddar's? how of the on that. a can then, And us that on you development you Thank coming for for give sense from just is

Rick Cardenas

going XX, low much maybe digits, single but much It's the as digits to XX. in lower Yes. single be to as as somewhere as

Peter Saleh

Thank much. Great. you very

Operator

at Barclays. Jeffrey Bernstein We'll go to next

is open. Please, Your line go ahead.

Jeffrey Bernstein

for you. leadership steady Thank thank for your follow. to and friendship the years example you and Gene, an over Great. setting the industry for

at LongHorn. So I seems we it's you like a stickier said XX% at business. think have would Garden, off-premise than on XX% the question thought, It Olive

lose that it I'm if wondering delivery split to here like I that's lot wondering to where you and within think a just whether you settle? you and seems where chance up expects like if share it consistencies improve, want consumer is see Just maybe going mean stay. the trucks you this delivery would pickup the the between to guys of to can seems sales current fees maybe there's any just don't kind aggregators. is the reconsider of this going. maybe third-party and are is guys eased. opening future the I It out

be you. great. on So, Thank would any thoughts that

Gene Lee

Gene. thought leave you'd is the this take room I delivery. Jeff, to ask Rick I'll third-party wait Hey, that. let about I until

Rick Cardenas

thanks and Jeff, don't are it's we for for that I in the having third-party their with same get between significantly. guests, question. couple Gene still others what And hit. a third-party think Olive like We without faster points. Go someone We believe delivery. grown in model. on many has delivery and right ways, the and have than place with our thing Garden grown don't Hey margin of us To it in business the that

the our from sales Now, Omicron. of influx partly of QX in QX, increased takeout because

will at going we don't a in they We're people Go know get it's back shift To levels bit but be not be COVID, shifted we be. seeing where on-premise are to to is so to it QX. And And a where higher again the experience. going today. equilibrium when a there, of We before back to little than were probably

delivered. make people order, out and pick so that the don't to to up that getting continue friction need so investments we the pay experience of And we'll take consider

us. guests so mean, a a did I that We for into you more little size. to a soon of our our for party the good third-party to really but and for order It's of bit good business, have it. the actually about setup and we order large anytime do ask prep time gives it us a about Now, but is we getting say us deliver delivery and delivery low. pretty minimum enough feel never never, It Olive Garden that's likelihood do delivery. business

Jeff Bernstein

Thank you.

Operator

to of UBS. We'll go Dennis next Geiger

Your ahead. line is Please open. go

Dennis Geiger

a a more. Gene, congrats and you remarkable ask staffing Thank situation Wanted on Great. to on the bit run.

there's to mind, to soon you'd make that, it relative be? where now call? wage like you is a are relates And as where to lot of that of too recognizing inflation, levels staffing kind Sort it or related to on your to

Rick Cardenas

for the much remarks, the in about that. did I than Dennis, Yes, three are we staffing our today feel where is as Rick. side. on we before the feel staffing Thanks three question in said -- prepared this months better We ago and months we

add of quarter to per before. the continue at from working basically around the We end the XX,XXX quarter quarter, people

because of our productivity greater exclusions as are enhancement. We And said, January, That in we we month staffing Our sure trained don't especially. team make did fully of need people pretty staffing of we as members were levels XX% to our before productive. pre-COVID levels. that have as want said, and the many we than that are tough

wage said, of we increase as seeing terms inflation, In we flow. are, a applicant on continued

starting But trends, to so actually become more that stabilize, And while after people to as hopefully little hasn't wage to it the an stabilize reversed right we'll know it's more -- that's Omicron starting we a know of of pick now, where endemic and kind to up working land. more starting a applicant going continues again versus bit. feel it's pandemic. but flow don't as comfortable And

Dennis Geiger

there, more one just And Great. Rick.

relates it it to to some, and the the I environment think, estate As opportunities. industry, you spoke competitive it related to as real

up look how to for you closures, maybe or that of independent for that that there you are thoughts what changed now because about the thinking you. on more the Has your challenges situation? means inflation? relates all have Has opportunity closures, all given Darden's small Thank share, brands? at perhaps share, -- permanent pick market Has it are chain ahead? better worse as gotten it the to As you coming,

Rick Cardenas

those what month over changed before restaurants restaurants Yeah, economic month And as and They'll there were as market some of up Dennis, pick today before to up, more time, thoughts environment continued the -- that. I struggle the and close. want our haven't get there that month fewer filled. be do eventually are share. is mean, last and to so the there picked we our fill restaurant Omicron than to

future, think eventually those back to As come hopefully our of end new were and the But better we they and we've -- restaurants increase that be to about will the said units. before. framework than going high get we're

the maybe better closed. than that be restaurants Our ones will were

Dennis Geiger

Thanks very much.

Operator

to next go We'll Stifel. Chris O'Cull at

ahead. Your line open. go is Please

Chris O'Cull

more value curious Thanks. had as on the has Garden. of shifted in inflation, perception? seen below to My of perception any value couple just Olive past value off-premise relates taken impact orders Rick, more any strategy your I'm pricing consumers' you've of the Garden's to if have Olive aggressive as others question pricing or change perception have over if years,

Rick Cardenas

big ago. We Olive are slope our Hey, on consumer a overall most American years change data in at versus satisfaction value in a across dissatisfied Garden. five to up on-premise continues and customers actually increase Olive a There's perception we really the satisfaction We're haven't both more bucking impact index. Garden trend. track Chris, seen off-premise. their that from internal

brands bucking our that are of trend. All

haven't don't Garden, have still, because ratings dramatically combined lower to change much for most pricing a two-year actions mentioned, restaurants we taken the continue big that over we're and seen going change think value to so than are had And We a as we'll Olive period. full-service monitor we in Raj that. that

Chris O'Cull

on Olive marketing That's more helpful. my [ph] XX% chains marketing to if with advertising, just all may starting are from isn’t increase at down any about top spend other levels, And concern mind is and Garden dollars lose aggressively? that then more awareness there pre-COVID spend

Rick Cardenas

pre-COVID. really going lower in Dan his I'm with you wait than of and the we for Yeah, equilibrium. keeping work that mentioned, to were spend our We're Chris, proud as marketing continue are strategy. has team to done, we the

to value over our we're doing about day we'll time. but expect to they Course get at marketing. we're Never We're would not remind day. look every been our value have marketing, First the We that on comes. right large, Garden. way about to Olive Olive to is the call. marketing where Garden their feel probably means is as earn be to We but find it we the last spend said Garden. we to continue bring get the everybody see And to promotional we time back they that on will marketing we marketing equilibrium the that, a scale, return talking advantages but so continue and at one up, back get Any we at increase every And time pre-COVID Olive the levels, all that, won't if want their But And we'll just of

Chris O'Cull

guys. Thanks, Great.

Operator

Gonzalez to Markets. go KeyBanc We'll Eric Capital next at

Your ahead. line Please go is open.

Eric Gonzalez

about environment. Hey, on years. My consumer follow for to question a over the And really the the thanks Gene, a pleasure your question. It's career. been fantastic success is congrats

in talked the low-end rise of out the wages pressures demand might if You we offset about wondering being post-Omicron in be there. to pent-up some March. Will cost some also I'm be less current be sensitive sustainable might So how might you increases? consumer price talk could the that contribute maybe to you might factors what perhaps the momentum about believe to sustainability? and experiencing

Rick Cardenas

but this sustainability. for we think December Omicron, And guided might we about the sales that our been what what Omicron, but other is have and And I'll things. it total be be pent-up will includes it's everything our was where Eric, will demand have for Rick. talk it would We've Yes, There know enough and might QX. than in demand what COVID. for what be, will there's guided higher sales we which some comp our today. QX about -- be, talks

like yet. have we're a state, so is we the back We a more back keep in and outlook which geopolitical QX and equilibrium that wider our continue again, what other not risk And is, steady to see equilibrium. state. do a this we got is. why time. everything normal there word normally than we're for coming What would going range to at to when to it's we We've And things, look

Eric Gonzalez

costs And maybe Fair enough. on quickly. labor

if turnover then to due seeing a drag, comment how of much exclusions the training and if can heavy you're to you normalized costs on levels excess quantify levels. wondering mentioned maybe staff You Omicron. any relative I'm just

Rick Cardenas

it in turnover over Yes, got turnover you think of XX-month in last It's and than a before better we'd to we fluctuation like levels bit versus time. little way getting over have the levels a turnover the XX-day were We months of that. long you've are where for a months level a kind at just lot the back we it. few But turnover be. higher us about a period, -- manage and still

So training they we're about and members why I'll to team what get they our business our specifically on understand other And about. more make to that's let Raj and more new all focusing speed even sure the up talk part. on is

Raj Vennam

Yes.

whether all about it part to pay purely say I'd that remind it's related the by side, I On is XX all Omicron XX impacted expense basis the deleverage from to XX XX training, overtime, margins probably expense stuff that points sick basis you, include that to points the sales range. impact, or just of the doesn't probably mix. our in

part other impacts margins, the that's it that the So of too.

Eric Gonzalez

That’s helpful. Thanks.

Operator

Piper We'll go next Sandler. to at Nicole Miller

Your lost your Andy with apologize. open. go We line is ahead. to Jefferies. go I Please line. We'll Barish

ahead. Your line open. go Please is

Andy Barish

quick Yes, one one – follow-up.

I $XXX okay. that million confused. winter was a sure the and weather you heard Was impact impact impact? that Omicron just sales on the I Raj, little I wanted quoted, Just, the to make

Raj Vennam

in impact the yes, January. referring specifically impact to We the in of was both. it both January, Yes, were from

Andy Barish

typically factors? you would kind the Gene, then, consumer a if consumer looking What on if be little wisdom what in could from stressed show final would impart to -- of I starting behavior and you mean, publicly of feel Okay. was for? environmental bit up

Gene Lee

Yes.

mean, to trying I -- in to us I bunch a obviously, indicator been we've be. to back recessions regress what try the different past chance understand the variables think may a give leading to of

going and able to this I different to hopefully, pandemic that, think this involved, going we're the because to endemic a switch one of we're with geopolitical because forward. virus risk live is so of

fairly have going it's to solid consumer. that a really recession some take think impact the on to I

and the other is than every about that, level many somewhat think going or I just it I And today. chains overseas. slowdown term, inventories really as I to as when the about recession, companies, with higher see sheet near been has getting the that a you so think supply a it's see open consumer recession And not things going variable a think than balance something forward real a low, there's in on period been broken biggest little bad previously. had anytime levels really especially significantly causes bit, a think have are barring that a us what's it's down don't different it's just stronger -- what the I unemployment slow happens is higher where I it's employment. jobs it, we -- don't And --

think work to this just I with perfectly we've so And like that's not different, one employment a number It's jobs. where of everybody because willing of matched open is. is

our look impact I impossible over the We an so think have open fair a to on one to come And cut to different of in jobs business had and out. tables be have have I a So we more business open so in do, Garden, would play it's today. XX some it to going or here in number this three like here.' in that's almost big in going But shop to how I know Olive overhead, at where, guests, jobs remember, 'Boy, tonight time. because we're many and that if say, if four a don't environment. don't it's the is XX pretty and come we variable

say, fighting profitable, great make for and think restaurants that I fighting there And last four top last sure always big today continue think is in we we -- I general and operator well. four we to that's operate we better. is I so that value to to That operate we're the restaurants need that just casual top. we're and So out to is, full-service need -- got the thing dining create

get COVID. great I think industry, to And get just environment. consumer think to them I the I to asking provide a earn we're got And full-service we've to pay stay got got think from again. the as pay. we've true doing what right But and We to open do had sloppy are got sharp we We've things our a teams to during to by. job. really an

Andy Barish

Thanks again.

Operator

Nicole, ahead. Nicole to open. return with Miller Piper Sandler. Please, go we'll line And And is your

Nicole Miller

Thank store bit you and on of say, little a so seems like hit Olive about environment, the Garden, talk much. and you lot it framework versus On and button gone mute, the really quick into apologize. mentioned consumer-facing in a ones. had plate reconcile sales back Two marketing investment marketing. has I areas. so Because Can you let's I the in, hang-up into a the the of discounting? normalized

sales would strategy. go the just to discounting, also with just so isn't but right you Could be And like a smidge a little back down bit? that it seems tempting that it talk to maybe about

Rick Cardenas

Nicole. Yes,

with added continuing we all or COVID. that of experience started pleased the out that the people, changes, we brands would but out the that I of We great are keeping pay if discounting brand. maintain of believe our at all really experience. that to Again, are but we of rather not of discount. mean strategy -- haven't have. with guest took that we willing for environment environment as We are core lot Garden options. our to out strategy it's experience consider have discounts a back. people a an add anything, back, are better in And guests we the provide to Olive we our that changes, Others have to will our that We

again, But and if to our we message time our limited when construct a than just go, Olive we of great know at is undiscounted when future, before. act. in biggest be comes that's whether offers Our never-ending the them, about value. we'll increase they'll strategy, course. which have it's out think get a our marketing -- different at Garden spend, And a option we even we as way we to had first is That equilibrium

Nicole Miller

in does not that's if or portfolio. period, could possible? macro equilibrium units Cheddar's, fast as Cheddar's anyone it's move best marketing the even do value the value or of that value curious like It But propositions if the quickly. about and weaker on and/or a grow then I'm press would as not of better that this the come, And you seems one

Rick Cardenas

much the the well, of That Nicole, to keeping our much scale competition, advertising. the lower the experience even great to is and a Cheddar's, improve as the TV experience improve as than Hey continuing of we're is advantage while pricing at prices kind perception value improve food, more. service value. to improve kind Cheddar's going much have And lower their value. which Cheddar's is doesn't do just

digital build, while and pipelines to of other best Our and paying is to take Cheddar's things building in that marketing to, with up if We're at in terms you're new and see need advertising ways right? those friends. that other your to continue brands. tell our the price So, growth, find we And them now. you going your do get we're a when unit and you ramp you to check

can't kind But ahead that one going we're gets the little versus say to turn we of on a few if open a the weaker brand You consumer of quite just other. dime and a of more capture Cheddar's, in to we're they a of them. restaurant to believe to pipeline and lot have And believe continue that going and people we that growth opportunity. of build of a

Nicole Miller

Thank you.

Operator

Andrew next Charles We'll at to go Cowen.

open, Your please line go is ahead.

Andrew Charles

the how for I have can And equilibrium -- high another But digital boundary to you said luck then sales Rick, that of a Great. Thank in percent Rick, you previously. there mix this off-premise you. The mix grew I unclear to new from a go And off-premise prior can is Gene, best quarter wishes on relative of know XX% well-deserved that XX%-plus is mix a off-premise role. retirement digital target. as and follow-up. your where to of best the of of sales XX% go?

Rick Cardenas

still it of the how that But be smooth not do and possible. as to how go they better that up. We're up pick I the with call dial order. Yes, how people may in as in, comfortable for They technology. XXX%. seamless that people making and don't mix experience trying and they as there's pick dial than But to the even want there do and make digital a limiter their high think in pay we're will are other

restaurant. grow So, they we some members that there percentage phone, team that et of cetera. off-premise. the technology offer still things as We front to the have fewer can But that but can to to that There's get part don't like and as they to the so maybe see us. that much, for the the that just dial-ins in them. we're are digital It pick continue to up would operation on things doing just do better service long-standing the continue do to like to guests see simplifies call, the we'll

eliminate to make. and made will dial-in to investments hopefully, continue We get of These will percentages have the we've the they'll percentages that up. not continue grow. And to because grown

Andrew Charles

mix we will the see Great. can pivot to help collection, to And data higher driving relatedly, expect higher off-premise increase or of digital a marketing to in then dine-in of XXXX XXXX back sales? focus message mix drive just more the marketing XXXX versus and a digital

Rick Cardenas

on-premise. versus we're on much I really so for sales environment off-premise, do say a talk going we looks about we'll drive on will need of don't digital whether whatever most XXXX. Andrew, like, to to not our that dine-in in more is as what's We going off-premise, lot do. the marketing marketing of the

it any do we will increase. if marketing, an off-premise be so And

much pretty marketing, on-premise. of if our -- So is it sorry, of most the be marketing I'm off-premise any we marketing will is Most increase. do our

Andrew Charles

Thank you.

Operator

We'll Credit Silberman Suisse. go next to at Lauren

is Please open. ahead. line Your go

Lauren Silberman

comments everyone's Thank Gene, you. your also I leadership. about And echo

ingredients talk in some commodity any So any of help chain looking pressures, and about pressures, the on levers supply additional price, the of can offset beyond sourcing? some you commodity at in other flexibility you're accelerating to the

Rick Cardenas

the the we Lauren, like in our works our Yeah, way taste right menu now food. really and

in expect this is. eventually products to hoping to that that We're whatever eat said value we in to a we we little work better, We'll for there it best some go So say, environment significantly takes consumers bit chain our ingredients there the with do get product. as inflation going don't will and offset with have come to of to continue we gets a but and that our partners costs. remarks, to to change get I can expect have prepared in can get don't -- consumers supply we're we I compete whatever environment my in to think these our the they the that prices when us.

Lauren Silberman

you. Thank

Operator

next go at to Chris Capital Carril Markets. We'll RBC

open. is Your ahead. line Please go

Chris Carril

going morning. Thanks the Gene, wish congratulations you and and forward. all best good

brands? pricing take this you additional additional the largest provide this you'll pricing your further maybe can brands versus planning higher at implement to on the detail on you're end specifically just how portfolio, beginning So your across quarter, any

Raj Vennam

Yeah.

to about can think, dining. I before our quarter-to-quarter. price the we've Chris, casual is is generally talked less way obviously, And at that from philosophy vary

science and to there's -- But for about we're over are because looking is specifics go generally into function a So quarterly change it's art but and time that that a the time, gained wrapping analytical, the time. over there's get how because lot pricing and don't at we've there we've that of want this I speaking, that very into data lot exact goes. also long how what of business being developed this we a numbers in intuition these goes of a monthly, on

Chris Carril

Got it. guess, I follow-up, And a as Raj. then,

incremental offset help to initiatives productivity mentioned also pressures that cost You seeing. these you're

these So more what just some Is to new of can productivity related employee like? you maybe on training? this expand look initiatives

Raj Vennam

stuff done the the lot is is a that goes goes that continuation of to what some it we through but think that, think of I -- back of did COVID. it simplification. we've things A I back with

simplify. in opportunities to them said find his to continue productive. we're Rick And We our on is training hiring new be more as as comments, focus people, then to

right people system is in takes them new there want their to we and our a So time. at and now, lot be best, of that

Chris Carril

you. Thank it. Got

Operator

JPMorgan. We'll with Ivankoe go next John to

Your ahead. Please line open. is go

John Ivankoe

your execute on good employees. also levels, that that made? the productivity question hospitality changes, guess, to staffing, overall employment still I was to that -- there the you've I or the actually just the think levels, improve. to to who to the turnover in get simplification, you including I guess menu on and past to hospitality are based described better would was It XXXX in how some class the beginning expect basis fiscal elements relative than XXXX allow that on done you hear you overall curious of are of I actually or Hi. But changes this of type process your basically have calendar-XXXX-and-beyond guess, your might The the annual XXXX. class and an back is applicants I you've some mean, been what your

Rick Cardenas

of a the a do ours.' out you a us past, the teaching folks some we're job it's Maybe have that to work to is work, new first someone we hired them that said, way restaurant. to items little lot do actually good very for to the One first because people less same and them a have seeing of for the working job. with we over John, her maybe of want has it it's we well. made simplification needed on we've these maybe in the over the I directly, question The we better and that would of for us. didn't we're good and We've better, had made. are work 'You work I our we're producing this that and things to things teaching answer in giving way a mean is did teaching run can managers them continue we on for menu easier before better that looked some again, we've spend come individual get menus the a that these things time folks experience have we it that their think produce us. class pretty our restaurant Yes, way When before, get have But the lot wouldn't But want. have the hiring at that guests how are a to happened been get things often. to through COVID we items just we at to which to couple thing reducing

people rehires. We of that left lot A of managers us also work have time. are coming rehires. for are seen lot us a to lot of our back a have And over

to that And people they're good back, the may industry so lot coming about we a feel while coming COVID, really have for work during back us. the of fact them are left and

John Ivankoe

again, Congratulations helpful. Gene. That’s

Operator

We'll Evercore go next to with David ISI. Palmer

Please Your ahead. open. go line is

David Palmer

a I change best the you in Darden’s have Thanks. COVID. a a career. and of retirement. has Gene, about to through going a lot Cheddar's heck before acquisition on Congrats, forward. question All Cheddar's of strategy gone

to with slow reached was that pretty during of you painful some productivity and think more than labor I it would but seemed COVID. levels have expected, transformational have

talk could this. about follow-up So forward can it unit could for you And quick what possibly ramp? a How new returns Cheddar's And growth I that brand? today? that have on unit look fast like going

Rick Cardenas

two a say much more the his Hey, me done years am us. I team John to they've and business how over it investable proposition at let Cheddar's just Wilkerson David, make model proud what of for and significantly COVID of changing over

to we'll continue to And continue we wasn't to we unit when digits up pipeline to As to ready them. that the probably earlier kind open low said had restaurants. team. to that to since high new is them. open we'll strengthen we ready questions, range we've got of the team we than as And build of the bought be in have that done single The opening more build of they one the XX, thing -- great

until and Cheddar's have a that say, How these and The will food And open Cheddar's more many? can done they consumer a you restaurants that of you be, the means built good have, for I of the well but be value lot had provide really we open. how provide, big can't can I can't get so, the fact the there's some that through tell they you addressable that out we about will we Cheddar's. I values opened that COVID that population. we've the can tell that tell us, they I for there. big they really feel more

Dave Palmer

Because just Cheddar's, Darden it the want be follow-up right more in play not -- companies of focus sort know, if not think back noting worth means, many as it's there. just will. a there's don't I have returns if mean, now, even maybe on sort you? And you an of many how premium, that? out part circle of, would to I just past you're for acquisition I getting to to be become, unit unusual But get acquisitions you were And, on I are that also what going

can see multiple rinse-and-repeat accretive You in on an strategy reflects an where acquisition like way, off credibility the that, paying that acquisitions.

you. that want And forward. going So you to capability? thank maybe focus is And on much this of to be a comment how for you going

Rick Cardenas

David. Yes,

that, and platform, If going go and that management is Darden we a regularly that acquisition forward. ready up still we part nothing we've forward. get you And four to our and get and team big over about made these that Board proven synergies. it build scale. We've of and and time, while platform since think continue But we to running our strategy Darden XXXX. to our acquisitions should brands And takes that proven We be that change which grow our strategy, a advantage, believe go going can add can a is brands biggest grow. evaluate is as help we've

Dave Palmer

you. Thank

Operator

Goldman Garber Jared to next go Sachs. We'll with

line Your go open. Please, is ahead.

Jared Garber

quarter, and certainly, on And, strategies think, but the think, and value consumer to some Hi. sense making taking of in that price question. the for Thanks the get appreciate consumer of terms all the I outside maybe you're questions we other as the the year. ahead dynamic. wanted I I Many for on color been thinking stronger the think great proposition rest of have of of about a asked the certainly answered, the

wondering your across pricing? better thinking of stronger can you're of, and there how value thinking here, loyalty of platform. So you if just Or comment a sort menu value program something plays that might strategies are any into improve that's sort on that through proposition outside whether other, brand-specific or that the

Rick Cardenas

Jared. Hi,

strategy going As we're operating to make to to philosophy: consistent We're sure our improve of simple in really talking are our invest and for continue about every we've restaurants. food, what to and basic, value to come we atmospheres in time been service, and you continue it about our think it's proposition, We're into one great. food, our make it years atmosphere. our and service more make better going going

our comes before. that's that below of below terms and best to expectation build Loyalty, believe the way continue where is it inflation, In again, from look price, value. price, -- highest at discount quite we we've our while the that competition that, to I'm we, We your to again. a consumers. is looked that, sure at may to not give value core is

build to for them. additional that been do a to they doing to value discounting without a an and continue is want price great we've and giving And is them think what we'll forward. for core visit because a at we're they value them goal consumers, that that fair our Our going

Jared Garber

the Great. color. Thanks for

Operator

We'll go next to Bartlett with Jake Securities. Truist

Your open, line please ahead. go is

Jake Bartlett

Gene, And any congratulations, in couple all post-COVID. was me to Great. all demand on question data can sneaking Omicron, just seeing consumers and a data-intensive on of is, there. the how in not in of more question are, shift that the how I'm just that haven't My the that given on pent-up idea just a you're material share consumers thoughts and separate echo come Thanks in if kind come back for how you really you itself is many -- wondering -- then a the here whether and regionality. whether you're years, seeing in, maybe post-COVID

quarter-to-date are Coast, near-term you pronounced and of maybe the prices different gas investors trends, it's much you're in to higher prices there. what in doing be seeing might about whether West consumer, variability any as concerned more regions as there's kind specifically think I think whether your about impact

Rick Cardenas

pent-up feel Jake, couple in that of for years seeing kind consumers So, as thought out a yes, waned -- of right? was dining percentage -- with we're terms a there of our comfortable maybe of didn't and Omicron, at dining, versus kind that demand over of still us COVID COVID been some are were haven't of that rooms people time. kind in the for and Delta done people there even going are

some we we're still skew still in seeing guests little better. We're come of And I If less second part. probably more over comfortable, about in think And felt terms skewed. that coming I and bit they still that mix a but little our so mix back. a are bit the back our is a forgot those demographics, getting think, -- there'll lower we're little be of that because, XX

Jake Bartlett

Geography.

Rick Cardenas

getting about much just on going really into what in were than say geography, already gas piece, sorry, I geography weeks. of will short were the but time get we're of anything the of to a and prices the moved the COVID terms geographic of just up not, three that a three I'm that in QX impact those prices else, geographic for they bit depending more -- Yes, Yes, right, related region not to felt little over quarter-to-date. Omicron versus the gas into think geography moved kind period weeks, kind in because they're I down don't in

Jake Bartlett

it. And quick follow-up. just Got a

you there's seeing the most more mentioned concern inflation. that's where low-income about consumer. lower-income the Gene, think just the consumer wage is And I

in whether So, of of I the are types Any a the But differences same? is there's -- to? more to any in whether quarter-to-date as other the little offset. about February wobbly insight appreciate performing maybe seeing one consumers all that exposed terms you in kind or than they're there you're or that of

Rick Cardenas

inflation. Yes, February, on environment in a Jake, based not in geopolitical on on the with anything what's we're going consumers material big difference seeing really March that's through or going

Jake Bartlett

Great. Thank I you. appreciate it.

Rick Cardenas

Sure.

Operator

question final our take We'll with Setyan from Nick Securities. Wedbush

Your Please line is open. go ahead.

Nick Setyan

It exposure lead way, very whether wisdom your just the you food would this of some to importance about on all it? if way throughout you pricing offset Is in costs, question the the you there pasta to be frame we could and is take years. of or the it. Thank basket any Gene, we exposure My can if you, frame need just it's be bread. percentage worried of for and your should is thank a specifically given would helpful your

Raj Vennam

food X% you wheat and Yeah. then bakery dimensionalize at pasta Nick, makes I'll the maybe to look is for When basket, it, you. bread. and up just it our rest X% related; is X%; call about

see sure the environment best in happens our with continuing that market, price to where we're we'll directly We're make is. really to that's get work the in in. and exposure wheat So the just what can we we to vendors

Nick Setyan

you. Great. Thank

Operator

conference for And you to comments. with additional holding, any or Kalicak, back no other turn questions I'll closing Mr. the

Kevin Kalicak

with XXrd, Jess. you our That on Thursday, today's all participating in conference for concludes like June you before a I'd you, Thank to remind market release fourth to quarter Thank call. results call. the And follow. to call we that plan opens,

Operator

We conference. for Ladies and conclude you participation. that today's your will thank gentlemen,

may at You disconnect this time.

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