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FRGI Fiesta Restaurant

Participants
Raphael Gross MD, ICR LLC
Richard Stockinger CEO and President
Danny Meisenheimer COO and SVP
Lynn Schweinfurth CFO and SVP
Will Slabaugh Stephens Incorporated
Nick Setyan Wedbush Securities
Brian Vaccaro Raymond James
Joshua Long Piper Jaffray
Call transcript
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Operator

Greetings, and welcome to Fiesta Restaurant Group Second Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Raphael Gross, Managing Director at ICR.

Raphael Gross

afternoon, good and you, everyone. Thank second Fiesta issued earnings was XXXX the Restaurant market Group's after close release quarter today.

under section. If you on www.frgi.com, found it can Investor have not already the accessed company's it, be the Relations website,

business and from the results costs Before of in for we to expressed for correct. on projected in such be the that the objectives budget, or such information is plans, available the considered discussion earnings like in results strategy, as limitation, statements that company's management evaluating assurance release. begin, of found implied discussed filings. and conference and historical expressed non-GAAP Important forecasted company statements can not forward-looking forward-looking future future be statements factors of from materially measures call, accordance information. that will those and be a be various position not and comparable company the its Any will statements should with can believes in differ GAAP measures useful company's outcomes call may performance. include, results statements substitute the GAAP cause or that by to be during prepared will today's make the no without isolation to can inform could company are such financial statements note reconciliation that results in company's operations. what or today, Actual which forward-looking differ you certain in give I'd operations, during materially is prove and based These financial forward-looking regarding actual can Please SEC the

and Vice Operating Financial turn Officer, and Danny over are Officer, the will Chief today Senior Rich. Rich call Lynn Vice Officer Stockinger; call Chief President, Senior Tropical Executive And Schweinfurth. I and and Meisenheimer; the now to President, President President Chief Pollo On

Richard Stockinger

Thank you, Ralph.

Strategic of Renewal with results. comparable positive its sales Plan, through our both impact progress the are in and is July The at we brands We and are making reflected believe the pleased acquisition quarter second

of rest have to X.X% the Broward July by for build continue scores company-owned move second quarter with quarterly to increasing and with of trends we performance them At with we in markets we is County a benchmark reported engagement gain respectively. Pollo, Similar the points for But encouraged where ongoing Box initiatives in on strongest up solid growth overall. have as work The be can X.X%. been sales Florida Southwest basis do sales to the to improvements by trajectory to Positive out Miami-Dade of affinity. solid and the point growth exhibit basis there the system consecutive the we approximately Pollo comparable sales continued our we and X.X% rolling to County continues quarter, and Florida testing net X.X% sales sales brand promoter forward. our Importantly, that first left a guest gain. growth to comparable core drive performance comparable also sales before points the exceeding still to XXX rising XX much that industry continued respectively, in Black restaurant

of in second This X.X% with strategic the have worked the fruit with quarter Taco restaurant renewal team implementing plan. gain comparable I me quarterly to increase expressing let comparable his are quarter and Cabana our pleased by making. was Turning Cabana, how headway start am XXXX. Chuck significant the efforts And tirelessly we second sales during the their bore since sales. first Taco

but on comparable also will Taco months. initiatives. to would an the four more minute, an growth provide Pollo saw like update consecutive Danny first to an X.X% gain, of I the Tropical's on extended for our relaunch July a to acceleration call to With I the sales color trends which we performance Cabana brand, over turn in in

Danny Meisenheimer

pleased am the we I with Rich. you, and great at encouraged Thank progress Pollo are Tropical. making

mix chicken helped broaden represent appeal. To and purchases including all in brand's demographic XX% Chicken brand's citrus-marinated three BLT already drive highest of we product the the the has expanded selling the introduction XX% new momentum, using platform, the experienced social transactions. crispy handheld to with to local June platform product earlier become have and frequency. support We're our store and awareness build chicken Crispy introductions, year which with in the marketing Our our chicken crispy a has of we currently introduced guest on Crispy this of line with Sandwich, broadcast, further item. the to sandwiches, engage

crispy sandwiches Wildcard chicken as in daily instance, the extended through Weekends our Tuesdays, locations. our We broadcast specific recently digital and Time days introduced for strategic Wednesdays media billboards of such deals Marination TropiChop channels. and utilizing For we Mondays, Pollo week promoted

quarter. social the reporting during we promoter to events guest and feedback engagement. quickly. of on net all team areas targeted rolled improved recently and media and held an our we out opportunity that scores general more allows unique our focus review Lastly, across to and Operationally, guest hospitality to We platform continue address of numerous markets managers

operations improve of managers We our tables conducted communication also training to and service and recently and collaboration. better-than-ever to our round capabilities general all with reinforce

improve tablets POS accept cards, to especially speed-of-service are busiest credit our will which upgrading our we in Additionally, restaurants. securely

focused control improving and better also cost food labor reporting through accountability. are and cost management on We

a may testing kiosk ticket that this cost, decrease at restaurants We increase average will be accuracy. year to and improve help few

do. mentioned, Rich much work As there is to still

off-premise implement that we year, loyalty program several the and new half the a our have of planning in We're engagement to our loyalty third the build frequency quarter. and business. guest We pilot the building underway plan program introduction including second of in to to initiatives growth new

season of focused managers on of We our will are experienced spearhead across and catering program implementation and holiday We're be have hired the catering to third-party catering solely leader the delivery process sales. growing an gift successful our who strategy catering, a business. off-premise in card refining ahead hiring

have also to dedicated of support senior We segment. operators one catering our our

starting and pilot in partnerships estimate For year. are third-party with later a delivery, we currently test vendors pursuing the

that Taken in together, gaining building and fully by place business the XXXX. we off-premise our traction in we investments making are year-end should believe be

Before can I one like to our thank team and over I'd hard Rich, enhanced back to members each it turn delivering we their of sales improved in Rich? hospitality work that build upon. for

Richard Stockinger

Thanks, Danny.

guest Taco quality, menu our improvements in promise the our bench build trends breadth is improvement brand a is with can I Training the recipes and upgraded we that service and increase so transaction. numerous comparable with mentioned X.X% experience, the leadership strategic deliver Momentum quarter, every of monthly reiterate in depth involve of and still earlier, on completion Cabana time. relaunched over hospitality employee by to we gain As we second for area is will reasonable our will items Cabana January. inspired since our These improve direction transaction and focus enhancement. believe of have prices, consisted our while that and eliminating with menu decline cuisine of create successfully at July We transactions key in that authentic our operations within Taco comparable To higher of experience. and discounting. by quality an high well deep base we sales we Note engagement. the and guest a believe prepared in original and sequential menu profitable to month freshly said brand underway meaningful the repositioning and growing promotional retention offering the our what past, the more this for experienced

to leader let's fact, Cabana's thus experienced In are Taco this now we With at progress process of the in industry Cabana. oversee the we a made renewal onboarding area review on Taco plan. new far that,

critical product turnaround brand's to the know, you effort. improvements are As

therefore, around ingredient, and almost through quality improved brisket, XX% menu. categories, enhancements most proteins that USDA across steak, of are utilized menu particular, have, and We Cabana's are upgrades, core recipe Choice Chicken, centered ground affecting Applewood-smoked In our beef shrimp. Taco products,

deliver by traction meal high All-day fresh We to relevant and with of to quality consistent dozen and promise continued build flavorful our tacos to introduced solutions guests. have deliver the tacos and recipes our ingredients. breakfast loaded

frozen as shareable and this Our original musicians, roots additional offerings the To alcoholic Margaritas beer to Revisiting fall lemonade including Taco soon with guest our for been Pollo Similar raspberry also in-restaurant with Patio be we vodka, our upon our Tropical, amplified new parties, appetizers. have beverages already restaurants, experience, approximately follow. some TC!, fun XX to kiosk program. testing and and nights guests. the café, well handmade efficiency. to complement Cabana karaoke, pilot patio we'll our to game further entertainment with we'll in Tito's including new improve we service sangria has loyalty patio draft And self-order TC with as MY vodka rolled Program Mexican activities patio as this out several locations other introduced seasonal made

improving focus are We improved that on over continue things margins. batch among and time. include forecasting cooking updated tracking labor and to guides processes, scheduling, other in Initiatives reduced progress

to reducing are development with benefit use added leaders of our costs. shift remote leadership we Additionally, increasing of the

in catering that in the and delivery, with therefore Cabana. these are especially be also throughout and starting And positioned Taco realized believe Boxes be we evening. Dozen ahead, continuing Looking we'll at addressing year is delivery and well see beyond. the great this half opportunities of and back potential Taco that day our to yet We for breakfast

and important as to as must base, build cost our operations, as while in investments also food well. and and we that it sales shore-up labor margins, four-wall we also is has We recognizing our made already appreciate begun solidify the to work that optimize

team with go all their feel But has to detail. with With Much this passion for will effort. thank our Lastly, let our turn together, work in still me the like our succeed. in we greater I accomplish. that, done all much to call I'd to to renewal Lynn over and of over confident employees been financials members, hard

Lynn Schweinfurth

you, Rich. Thank

a past gain this quarter higher that during made sales positive as X.X% by in improvements a restaurant quarter of basis operating we During than margins, expense maintenance decrease margins, Comparable expense, last operating partially comparable improve restaurant restaurant decreased to last EBITDA X.X% unprofitable by due of At the the and year. increase restaurant hours. X.X% price by year. deep other of in to Pollo in the to of X.X% elimination related offsetting year. check, negative X.X% as XX.X% increase average our Taco repositioning. promotions to experience, in X.X% and second the restaurant XXXX, experienced primarily of with and average the a comparable driven check, the transactions. advertising we and and the the Comparable decrease pricing restaurants sales This initiatives quarter X% percentage primarily offset filings, points effects inclusive sales quarter staffing higher items XXXX higher to year's cost in in positive of associated in second sales of XXXX. inclusive XXX increased decreased second discounting menu restaurant and X.X% in year's in a guest labor compared and brand's restaurant-level This and closing over with $X brand's repositioning under Pollo, decrease impact respectively, have at of adjusted increasing sales comparable more included offset an pricing, new measures, the investments the related mix Note reduction included in sales plan the in second the partially million defined compared SEC a of by increased non-GAAP overnight material related and at transactions X.X% gain to in

margins in Taco, cost by costs compensation, staffing lower due comparable sales upgrades the At percentage sales first food quarter higher stated, restaurant throughout improved trend, hours and expenses. sales incentive-based However, offset operating EBITDA the and related as as still quality, of decreased while second of a $X.X the partially to by to did negatively due labor to just higher it as higher hospitality XXX other restaurant by adjusted increased higher impacted million points. second EBITDA Restaurant-level to improve quarter and margins adjusted declined restaurant-level quarter. basis negative, Rich transaction by were

by During expenses. lower defined in quarter, adjusted by non-GAAP filings, both adjusted lower the our declined partially EBITDA, to EBITDA offset SEC G&A consolidated at $XX.X primarily driven a restaurant-level brands, measure million,

the additional item of million P&L, $X.X in the review insurance previously $X.X the write-off We While by the insurance consisted I I cost in closed want on gains Irma, fourth Hurricanes hurricanes recognize in third recoveries quarter were restaurant not line sale and or removal, to other equipment the did cost These of related our This the to mention net Harvey from for for two and a transfer income. of on gain hurricanes every and and gains in million $X.X recoveries quarter. million site total partially additional of may restaurant. properties. development offset storage will

we experience. restaurant mentioned, focused margins, on continuing guest a improving previously while great keenly to As are our deliver

the theoretical our to procedures business. programs addition food already In we cost to better the inventory refining and described, are manage

models We reporting. with our we restaurants optimize to and are visibility our are processes also and staffing and refining labor when increased how

while fact, a In initiative costs. at is Taco underway it generated improved new recently still has early, labor labor

wages and development the on operate. While quarter, engagement going focus competitive staffing rate we net prior to higher non-GAAP diluted or reduce release This in low-single-digits pressures wage which SEC compared may second refer million million tables. reconciliation in due or was markets forward, share per in retention. $X.X are income to also overtime filings leadership related the diluted environment result continues period with in concurrently and of we adjusted measure inflation per to the improve all $X.X employee the higher be in we to our and while labor income, increases experiencing increasing earnings $X.XX turnover share. non-GAAP Adjusted for to Please $X.XX net a year

million In $XX due we capital in capital at now million. million range of the of previously be reminder, our This to improve to high-end for million capital for additional expenditures are support include XXXX terms expecting to to our restaurants. to restaurants and of food primarily quality Other capital announced development remodels. and $XX $XX this allocation, investments $XX is Difficulty] our and includes deferred maintenance to new consistency the spending will of and catering [Technical other restaurant and

opened XXXX's we four plan, of expect Florida, our been of company-owned end the the to quarter. as have Turning already which Pollo of openings seven new in restaurant second development Tropical

end new two new openings quarter areas trade opened the as Cabana restaurants that second been opened expect in same Taco and replaced Of one Texas, of in seven the Cabana of also seven openings, company-owned six second superior those during two of restaurant the We already have restaurant in which July. quarter. in Taco locations closed the restaurants

varying these Irma third the restaurant XXXX, of year. two reminder, the Cabana As XXXX, five Taco Tropical Cabana cost. restaurants were that Restaurants by the include will Pollo lower the prior at Pollo and Pollo Tropical Taco X.X% the to transactions sales impacted anniversaries a area Hurricanes Taco and by Houston in restaurant with affected and Metropolitan openings In Harvey and lapping XXX Pollo negatively conversions quarter all hurricanes the third and X%. at of investment XX and from we closed of Tropical [Technical We closed estimate Difficulty] to restaurants In in be approximately X% X.X% area quarter hurricanes by approximately degrees. comparable metropolitan

our at shareholder plan, term We elevating renewal to through developing long closing [Technical that model to by our value. In strong a negatively Taco business adjusted hurricanes EBITDA brands impacted [Technical also are estimate the by build Difficulty] (X:XX:XX) Difficulty]. approximately are Pollo we

hard momentum this and We are planned to our the will up year that, you. ahead. continue line With the to lot balance questions. have years working of a exciting going we and maintain open of the for Thank things

Operator

with we'll question be your [Operator Stephens time proceed Incorporated. Will first Please session. from Slabaugh Instructions] this Our conducting with comes question-and-answer At a question.

Will Slabaugh

Yeah, thank you.

Cabana a in to? you - you'd was First here the credit I relaunch that the congrats especially mentioned July and you on could talk there most curious the question there acceleration about I brand happened on Taco month. recently. and if know more just that was was churn what

a see. If a being back big that from restaurant - immediate felt So you to I turned something bump else like curious of inside were necessarily we a weren't the on? that there was was bit just if happening the able

Richard Stockinger

to I been it's each continued we are just month, We're and you restaurants. culmination, think no getting our because happened been profile our - people families Rich There it's more has has is guests. show seeing it's changing. to something doubt show Will? a guest that profitable more though how Stockinger, week and younger coming not It's improvement Even overnight. been in each that

and thing just place. it's have one of we a a now So since happened, time, all represents proteins same And each it's than especially not as one in our percentage that's culmination about proteins over our any one. other the

not it's done recent haven't July that other, So like in nothing but we different did the addition in special months. one is the overshadowing that in there protein was we or

Will Slabaugh

talk Got And LTOs have thinking feel a peers the previously. as LTOs deep to going you that positions that of versus price you points. some been versus advertising future some Taco like in peers involved Can you brand mentioned, it. and a particular are that on with how more discounts are about you larger for full-priced second, more aggressive likely there and items your

Richard Stockinger

Sure.

there try and we spare I complements which of lot people we it after think call this position negative would go an with Tour Taco a feel to type at below it Taco is between pricing full the opportunity competitors as we're to that no what ourselves high the but we've restaurant quality Bell, say done and is. [ph] Cheese in guest for quality items. all, where guest getting Blanco to these there that guest, means I

us put So between of that's those why in categories. types I two

Will Slabaugh

sort entail we work maybe this a Got of feel into at down of of throughout [ph] more lot maybe year? continuing said the sort of into because you Florida to rest that Can in way is lastly then it. And system like is breadth South same what to doing. you you lead or testing a And you're in there main and the terms Pollo. what also mentioned the the of little go of leaking drive as detail you a bit that

Danny Meisenheimer

this Yeah, Danny. is

as from are and a things think or really combination sandwiches I to only Bites introduced also months. product the that And of really after those as driven Crispy the they within mix well terrific an crispy new transaction. both a as The the entrée last have as for shift which And there that remarkable for us incremental the of not drive really having this. we've two introduced the sales as platform Pollo have been an on done crispy three bites of And the appetizer. it's we but And grown that come us. some platform. introduction an two menu the then really have add here also

So on we're sales meals the purchases and platform our the sandwich seeing overall just and traffic really elevated combo gain. has our

Will Slabaugh

Great. Thank you.

Operator

from comes with Securities. your Nick question proceed Setyan, next Our Please Wedbush question.

Nick Setyan

about think Hey, for business. and of on thank question you the medium just the maybe should largely the of term margins we just at taking another My the right you with how size some quarter. at respect near unit Taco? to the metrics margins and congrats with right Pollo the the more question beyond of How to or growth, kind to longer to respect great term, kind and relates business, size

Richard Stockinger

Yeah, and thanks, it's Rich, Nick.

I got months current but because, think that again, being in terms we know don't than done. we next you to of year, be And the officially, advance. unit not XX different the growth, more year out is plan come see in haven't and I much

especially experts outside technology, up investment brands. starting to and both that come a we're on we we of program, ready brought We in, a to set these have to lot put loyalty now help in us of We to in our a do, implement. lot new and work

partnering minimal give will with a catering, punch these for basically the in is the do And Houston major regarding at delivery arm, Taco. both Taco and working In at a when is look brands down Pollo Florida really catering of at There's we incredible opportunity San its to very huge markets closely a Dallas, Antonio Pollo, which delivery, I and and do and we're an there real and in last and the terms that none South us part opportunity company it's two profitable. I look here being such really catering. in national with at

but we not units the existing so open going this and growth after, us. in opportunities same minimal looking in we're the much are in not - So opening terms markets really do of future - next to really going restaurants have sales to is it's really in about same year, that the year. exciting we're the the I'm year existing

margins terms we're produce In on. our especially Pollo margins, of We're with vendors, working the the working companies.

the produce, I poultry think we'll see - not companies.

I in at they've next Taco. over improvement us. the see months see to the that already And we'll we've also the help chicken Taco, done in food XX of labor we the some cost announced are costs then speak, in as Taco, the that improvements it and happening think area we'll the some work because

down barring unforeseen see now. issues at right don't food see the I right them both to I bit related I rising. costs see that don't a So any industry coming aren't brands.

Nick Setyan

helpful. the when That's Revitalization And joined, we you when Plan. got you. Thank first

the more. I one of think little looking was a franchising points potentially at bit

the last much focused you are turning around. on as about from But haven't over the how thinking it you franchising on? We here forward going about XX months, business heard understandably,

Richard Stockinger

document the Taco Taco, get successful that thereafter. And be will I We're to think the several still We're blown to companies groundwork go franchise then working on filing and we'll brands. road. licensing have the side. Sure. Mexico. be licensing renewal, be are ready to in a surely looking we our I we franchise potential but franchising. while and will shortly Pollo franchising wanted But doing tomorrow we at already I for say, on on side On And not be the New with done both down full

of we think, success, future. corner but it at a right recent at we Taco, we've now with you the that that you and doing maybe, turning out may where on door some costs a the I as the opportunity tell to can of haven't success new announced our are open near huge can our open the franchising have Pollo, converted spend what higher and to that less We you come Pollos to us don't the in conversions do program opportunity in formally sized up investment have ground Tacos a might

Nick Setyan

then G&A. very the kind Lynn we back the maybe year, directionally How about on G&A of helpful. And should half? think for That's just in

Lynn Schweinfurth

We're of G&A. the Certainly to continuing year. into opportunities find to as half we our leverage back get the

benefit the a hurricane with have quarter. associated lapping will third We

So that's drive certainly Controlling supporting then going our G&A of to to as to look of a the will need look return move leverage means leverage we some provide out to, And forward, for where moving forward. year. the those our we certainly we that to parts as continue we balance the costs, growing business will only expenses. and on

Nick Setyan

Thank you.

Operator

Our Vaccaro, question. with next Please proceed Raymond question comes from your James. Brian

Brian Vaccaro

Tropical, were Thank launch. we Pollo the North evening. Florida just if or markets it legacy further you how versus Atlanta, and little even in will you share if with and Central crispy South your you'd products? drill And and down product dynamics if compares on chicken the positioning in curious further a good details advertisers' there sales on competitive differences hoping non-core mix, brand Florida the markets you how versus can and differences Florida, Starting curious the given in positioned

Danny Meisenheimer

basis, Danny. had like or Broward in get to very a to the We found product. that Northern weighted you you isn't little markets promote and our is a Dayton on and research get aggressively is when markets we boneless appeal that transaction high the same conducted in also But typically crispy, suggest crispy Orlando. This through not with Atlanta, this or rate Florida. markets it's higher the But very to those also the more like markets, on platform, our Jackson a out well. in We do South that down it

the a you the bit way range, to demonstrates accept talking from it But we're high a the bites, So being number. South we it's regardless number the range going little typically on further North whether sandwich talk lower or better extremely Florida the all whether the it's well the to market. about a go, of But it's about performs. when that of

Richard Stockinger

it's Brian Rich.

that which area and it's restaurants, into our well. is and locations you where six to bite extremely just extremely And then breast, other well, we is it remind cut our The is program, XX performing in hours the it's pieces. colleges license Pollo that for licensed universities, marinated the gone fresh chicken again

within it's real the fry restaurant process. result stays citrus system. the product flavor frying a that's we And then hand where fresh So special chicken, it's of and bread in right it's the it and what's throughout on as that marinate and really the it caught

Brian Vaccaro

driving of much right, And the I you on you versus research get that to know to brand do any for able thank early, All chicken but guests? mix a customer due crispy a new been still and have that. of consumer to it's attracting sense appeal amongst how of frequency sales sort existing is broadening

Danny Meisenheimer

Yes, largely everything to this point has been anecdotal.

to chance bit and later to chance guests them little a to experience We year. give have with we the done research to product to visiting little market but some market in a needed this intercepts the but be get will we conducting We will be it, bit get later.

Richard Stockinger

into and it's to including they itself. we that though, permission extensive really And the launch what was to marinated market a again And them that's to in it. diverse doing that there. be to platform. really bottom it's Southwest the been try everyone where us the groups ready, Rich has Brian, the turnaround down what we and successful Is did this of focus we'll of the that's leads where very research and get we Florida, the citrus And gave according get we're did to chicken research it allowed again. before about fried been us

doing customer intercepts very be shortly. than pretty more but just excited, So we're we'll

Brian Vaccaro

All great. right, that's

the much how easier about add back I comparisons Taco, just what lapping ask and guess Just shifting underlying July. quarter lower the you in on maybe year? it remind of seen versus thinking and true us is to lapping improvement. gears, I last was trends, wanted to-date circle underlying you improvement about have the of Can spend sort

color you put just that? on If some

Lynn Schweinfurth

July. the Well decline X.X% lapping a are last month year, in of we

a So more we were negative lapping period.

from May, air to essentially If mid-part early October. we of were to off you recall the

gradual most Houston the continue we this primarily markets led to and currently. that are really see in across in So being Dallas of major our But we period. improvement our results, middle of by

Brian Vaccaro

a sort in even of year modest you but Okay, is will, improvement encouraging. trend, the two if

which one comments of then one of and appreciate the bridge to building do that where Taco currently efficiency that run me, savings current there low on from the and margins, could, of run And in settling to But is you thank the just of all I sort I That's sort how pursuing store rate some due last your initiatives out versus cost you Okay. we're rate, much margins. and you. expected the a seeing double-digit here? see improve sort normal of if Rich of from from sales programs profitability level that are a Cabana

Richard Stockinger

get under much Brian, to how as a can Okay, great I question. to am Lynn I say. that's table going kicked the by

definitely the have cost, think we're is room in right now that grab margins we We from have pretty going there probably and to on How labor point and there think we've we at locked that there's be much trend Taco, food in get now. I the can right then of pretty the can quickly in a much working a diligently. perspective, we

be able anticipate So Taco. has price we'll at to chicken increases significant of think increases don't I or pretty any at - get some a the price improvements I lot all do it quickly. in to

units. going price people It's certain going now et in be not combos the after it's within But doing be better have LTOs of to from in. of get done be items just anything the right doing I enough increases, controls going cetera. We'll think going some to now now. to combination be a we to

Brian Vaccaro

Thank you.

Operator

reminder, now Instructions] proceed Please Our question. Long, a Joshua Piper comes with we next a As from session. question-and-answer [Operator Jaffray. question your are conducting

Joshua Long

Hey, or thank dig wanted catering reinvesting a delivery. taking business, had you you into It question. my some putting level. through of and then and managers at into exciting for for also store sales I catering off-premise to the seems like the both piece mentioned the opportunity pretty in

you we've day end said that then - to as works the account think early should just term, or those look longer thinking curious are start unit how off-premise hours you've with on kind able about but of do then it's of the if a of the are? at as what size it's footprint process you kind little taking term, look been that offset how going And forward? know start taken So large where of net still store you think not just we positions the maybe the opportunity that a if to and some operating kind at into adds development, like of I re-accelerating longer balancing

Danny Meisenheimer

Danny. is Okay. This

the managers with go The then and catering start that that an they're revenue me piece, is piece we'll in the - the for development. because we're generators. catering to there Let offset adding,

do way sales We're we standpoint. catering but because that standpoint. only the plan, terms will we from from is the at doing first establish standpoint, this Pollo of a are in where not program staffing so an a with And renewal to operations that of where are from we

coming whether terms offset Taco choose, by we whether - and the converge clearly than that offset of first that in and do follow business. by in for more from we the from level, course, the side make a will will provide into Cabana that is it's at year. catering opportunity same we gain suit of it's that's big sales pick-up standpoint. fourth brand then the two And of unit investment time we that our the the for capital that partners services that. Anything so investment of push quarter as And true the delivery those during of catering the the we The

So are second, be the off delivery first, catering Pollo and first be the Taco second. and another, third-party these will will hinged then to two one things

year are year, development, year but next and the where Texas, operate of much the of at be Difficulty] again, of our still so we're opportunity we're locations, next to But is not we going to and done with we're growth. and to and where walls not get yet to do as we within businesses. accelerate And our outside have year four [Technical Florida when going (X:XX:XX) looking And at this there to that least work similar not lot is but after. program. up that terms a year after to In of what started already a We have renewal ramping we've currently the the not that already past we

Joshua Long

the kind or Curious you that talked about maybe of markets? brand fact terms what were a in lot Great. of you've your push perhaps Taco, you more even for the to further. in younger just these new a that. research bringing brand you brand on maybe And ability consumer. repositioning the families, got a is if then of Thank strong the of in core the given telling Texas Curious equity those to bit lapsed

that yourself two that mentioned in you benchmarked have had you of You kind wanted brands particular against.

from giving if the permission new you be that? that may of be or perspective curious up viewing is menu to move just kind Just how mix a of you're and of thinking product kind as the consumer well about

Richard Stockinger

advertising, tell going believe been them guests several are discounting the What's there more deep quality new Taco Sure. bringing is we well haven't you seeing at freshness media all of as in the I driving cetera. quality as because full more et major I and our which more social deals in the in is is with We've to lack and and daily social followers years in effort price. of really and will that quality bringing quality and of for of we're media. some ingredients of about started that a our our which

very means there or which from research, competitor X.XX, the discrediting X.XX any know at not high-quality between more is is again, price those market people two So full good value for discrediting think We full a in our us. a is market and just guest. doing above the profit that there a all

enjoying an and haven't coming items getting the end a of in. Chuck at we the newer going getting to having at enjoying patio. been They're guests the and to do more team, of us that starting are bringing and his then either But we're sharable in into item So year, to and this coming and these guests, now to next new coming some year same expect while, they're going that but the looking some restaurants with speaking we're guests time. alcoholic children new some the beverage our research to a with by

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Joshua Long

Great. Thank you.

Operator

of and end session. gentlemen Ladies conclude today's the reached does this have the we conference. question-and-answer And

You at your may you disconnect lines participation. this time. for Thank your