Dine Brands Global (DIN)

Ken Diptee Executive Director of Investor Relations
John Peyton Chief Executive Officer
Allison Hall Chief Financial Officer
John Cywinski President, Applebee's Inc
Jay Johns President, IHOP
Jake Bartlett Truist Securities
Nick Setyan Wedbush Securities
Brian Vaccaro Raymond James
Todd Brooks C.L. King and Associates
Brett Levy MKM Partners
Call transcript
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Hello and welcome to the Fourth Quarter 2020 Dine Brands Global Earnings Conference Call. My name is Grace, and I will be your operator for today's call. [Operator instructions] Please note that this conference call is being recorded. I will now turn the call over to Ken Diptee, Executive Director of Investor Relations. Sir, you may begin.

Ken Diptee

to fourth welcome XXXX and and call. conference morning, Dine quarter Brands' fiscal Good John Allison of Peyton, and by joined I'm CEO; Song, Cywinski, of Jay John Controller Hall, CFO; Johns, and President IHOP; President Applebee's. Tom CFO Interim

to call harbor information. turn remember forward-looking please over I our John, Before the safe regarding

those forward-looking filing. risks, Please these statements. discuss actual factors, other in which these the cause the to information management During is and and the may call, today implied. factors, involves uncertainties which today's press obligation the context supplement forward-looking in of is expressed statements of are different than release results The as no that evaluate or detailed information and are assume known or XX-K and update and unknown forward-looking may

refer John. to on also and non-GAAP that, I'll call certain press which turn Relations With financial available our in are website. may the You to also described release Dine Investor Brands' measures, over

John Peyton

believe who that during of Dine changed. and and we strong with the era franchisees who in connection. who everyone. service two human And before. new the remained main solid joining people Brands out of story win that's brands, the talented we and end expect in all the a Dine what enter the And Thanks innovations and beginning XXXX. for has new in those Dine in believe a I Good iconic those members on it's more industry. restaurants communities and to us. Brands. And essential restaurants pandemic, Those the me than because to the ever resilient thanks appreciate are I of most restaurant fundamentals, category invested new the team of renaissance. and certainly eating as I technology menu challenge. face honor we're in cusp now America common And are that's be the to saying by morning, restaurants, Brands believe an Ken. start join I'll And restaurants for of

and Let story. tell my about me bit pause you a

a parent's and an demands are As a teen light; connect business me our also humbled cash. the guests. important know where with the was significant we college that most West because essential franchise ago, model, XX the emotional And iconic and I and XX% restaurants I was of the Starwood stunned at and are like IHOP almost brands. community, way that certainly called for of example the different, PwC. Realogy. because I that Philadelphia. innovator also and joined at breakfast special. to And believe are better strong other Omelet of lure Hotels, in a words, Applebee's special, have the of and recently pancake I for fun. it most neighborhood. eating good what most of a to call in win American the is be makes important I I means by then Dine meal that all And brands worked my was are connections. human years I fabric in asset when and generator I different, In brands parents. We taught work truly a the XXxX marketing Southern of a relevant. Station on our and to wizard our locally who that's required embodies was obsessed day, we they're mentor and restaurant, went mine the Applebee's as at After brands power consultant it my and better

owners requires less of allows operating are And with to model fluctuations those Starwood generally in from are valuable of capital. And me every to our market. our our franchisee restaurants who requires years that franchisee us buffer day plus ensure partnership, create helps successful builds hard model that franchise and investments that XX best true do independent it significant we businesses so Our to My franchising Realogy work generational and taught support. the wealth.

last conducted the a I've and I've culture. the Dine's months, dive been more on brands few learning more the over company, dynamic our So move, across about corporate and deep

to So Applebee's spoken and far, I've our our to test restaurants. and the win. desire connected the and And restaurants with and with that a bankers I've our system network grow than more they visited of of XX% in our IHOP invest in I and team report and I've third around our can suppliers its kitchen. world. franchisees And XX to aligned US members. our and also represent the is

solid. Now the remain pandemic of impact despite fundamentals Dine the

revolver credit its recall rating. Dine Dine the that last issuer may S&P business have our our last million securitization watch the illustrates three drawn due - to was the did watch and S&P or time. industry note decision was company's not notes with fall as watch business whole our from credit that financial footing, XXXX, at $XXX we month in March. credit BBB on a whole plan reaffirmed later, S&P remain placed repay other to strong. XXXX March in securitizations fundamentals note last from sound removed the emerged on because months our to that great pandemic. the we and on And of You negative our remain downgraded, full in it achievement of for only in Six two

resulting to of month, expect in the savings this $X We interest expense approximately million. repayment complete

good standing. addition strong passionate we franchisees In to in have fundamentals, remain that very

franchisees being marketing and according deferred of to QX in we approximately knowledge. Our are fabulous during collection brands rate both And paid by executive experience fees at addition and to importantly, schedule. year led exceptional our last royalty team back XX%. the fee industry with stands are And for veteran

franchisees brands the Jay and it's that of shortly. our throughout via You'll in expertise stewardship their collective and wisdom XXXX. off truly from And extraordinary and hear John paid challenge their the

X, the a as in increases ending support primarily live outlook of percentage by And just half during consumer pandemic. crisis Overall a points, about off-premise eight off that XXXX. anticipating indoor dining guests returned by invest brand since vaccination and improving franchisees committed of that for the just the to And times will their maintained by about restaurant six will January also we're driven weekly guests continuing improved we year, and ahead, our during IHOP trust restaurant brands Applebee's We're have quarter. rates. business. both sales me, the trends as gains looking we brands one view for So the rebound and team sales like posted of second in new week to like health we're of IHOP growing total off-premise because points. sales look technology you encouraged And of certainly approximately safety. are dining third to fourth IHOP in to and guests premise the business, Applebee's approximately behavior optimistic We're and both to off-premise and trust. our and Applebee's our also beyond

the for brought growth. taking pandemic, So long-term fundamentals Dine positioned to uniquely us challenges collectively, sustainable Brands enjoy position the on and by the

three XX Our objectives focused to months. on next XX the over team

of navigate we believe of the what first is end to The crisis. the beginning is the

follows the new The normal second is growth is win that to win third and the the and to long-term vehicles. evaluate recovery

So each about of of those. allow me to thinking share a my bit

of beginning is the crisis. First the of end the navigate to

working Of cash. are operational grows. we'll our improvement standards recovery preparing continuous focus drive new course, health intensely as to ensure franchisees. our financial campaigns and compelling safety and health And restaurants. we protect and And monitor the also we'll in on continue We're to marketing in products to of

reflect and targeted the from realign win our and third, our menu evaluate take expansion traditional leveraging channel which growth recovery which kitchens, of underway. one-to-one our And right recent we'll brands, incorporating for consumer brands long-term and a learnings those the we'll mix as at past from and insights, we includes and new everything via have and And opportunities win ghost And to time. to and continue will virtual both reactivate CRM the normal reflect in a markets we marketing. prototypes to exploring the look international reset non-traditional at learnings both development, well. vehicles, key visiting And brand XX efforts we'll new investments Second, third months. possibly by we'll both the digital guests highly to

wrap an to opportunity. I play and often a emphasize our to flexibility, protect we restaurants. inside while want And in our often said in the innovative of I more emerge up, our virtual supporting online burritos that Dine in brand like position menu while As Applebee's offerings, the knew serve was threat as workers products CRM XXXX, investing hour, both views and digital new we important a liquidity both summer, guests and from it we crisis our new we in happy defense were invest communities we the as to also and cosmic and play Because as franchisees that we early need. outside crisis would menu frontline and coming this And wings. to in to invested and in well IHOP and and new sheltering feeding in are their by IHOP those in bowls local technology continue items so

will all combined, investments so dining. our off these that returns And pay indoor of as it's guests

I'll that, of an over provide financial to to it turn with So our results. Allison overview

Allison Hall

the results Good full business begin quarter, with fourth our John. review for you, everyone. morning, a Thank Then I'll and year. update. the

XXXX. discuss I'll Lastly, for guidance financial our performance

we year, drawing steps remain took XXXX our facility, challenging revolving including which of December down all to very maintain XXst. credit from flexibility, million a $XXX as our During March in financial outstanding

to measure sheet increase strong share which we with million our primarily balance year-end temporary cash restricted million ended just need higher were XXXX, from million the $XX.X a maintain repay was to suspension both drawn our XXXX. John to during a to mentioned, of the the the XXXX As cash we total response COVID-XX of dividends Due and repurchase have of The our of excluding to proactive the of million, cash program. and $XXX million, and equivalents pandemic $XXX continue on taken this financial the due liquidity. $XXX compared quarterly cash month end We at to steps revolver, $XX to These includes flexibility. March. the plan cash was very

XXXX. corporate G&A to following difficult during the furlough Additionally, and costs to austerity, for our lower decision of several third able we maintain were year compensation one approximately tight months during the of staff management

changes to with notable results, our the statement. financial I'll our income Turning on begin

same of was adjusted For XXXX. $X quarter for to compared the XX fourth $X.XX, EPS the quarter

at The impact profit. resulted and Applebee's pandemic decreases adjusted in compared debt. in to decline a restrictions operation. dining in brands domestic year-over-year franchise increase comp significant and XXXX. from resulting decrease declines XXXX, This and led IHOP $X.XX gross to of a in sales number in traffic, lower capacity EPS operations restaurants of to in governmental both on the For $X.XX The and was due an effective bad on customer

our was Switching $XXX.X approximately the XXXX, G&A costs. due For was G&A cases. response In than G&A for our of $XXX.X model, compared tighten debt to to gears bad improved revenues million, XXXX, XXXX, for was in million Coronavirus to fourth G&A $XX XXXX from to like controls of our constituted year. XX% a the the ability lower decline for compensation million, for entire asset G&A; decrease for fourth quarter bad million to primarily our advertising. as quarter to resurgence to travel million guidance decline compares total $X.X XXXX. the virtually The primarily costs. G&A business compensation approximately us. an of to and given XXXX. lever that, of due to important it company in which related remains around $XX.X quarter debt same restaurant related travel no lower last including in million our included million This to The was was management the G&A excluding primarily and due segment. for $XX.X $XX.X

for compared on discussed. the total decrease previously XXXX The in resulting primarily our cash million, $XXX.X in in XXXX. guest as to due turning flow statement; to million Now operations from a restaurants traffic revenues, to from change was $XX.X cash decline was a

our the compared to just Our to generate highly of to million in million flow in allow pandemic in of that strong discussed, $XXX.X to from from throughout cash prior liquidity We primarily the the free was $XXX.X as and due continued primarily cash will our the make effects year. XXXX was hand, adjusted to by lower year The continues taken to to the business compared operations steps on us continue the mitigate believe decline offset franchised cash strong cash decrease model CapEx to XXXX. operations improve.

Now capital our continue regarding reevaluate we strategy. capital allocation, to allocation

resumed. industry to As normal conditions and restaurant continue improve, operations

million $XXX As the repay last previously discussed, March. to we drawn plan

dividends and cash the our or Additionally, reinstating assumption share we'll review quarterly repurchase program.

existing both We evaluate and investments enabled growth. for non-organic also brands in will our platforms organic

program, deferrals franchisees million In update franchisees full. a an assistance of provide Overall of advertising the provide approximately franchisees what Dine and Brands continue track. across been and have total in case-by-case deferrals in deferred fees and for payment both million on on royalty we XX approximately deferrals on balances XXX our $XX repaid rent our to to $XX provided $XX.X assistance basis. to total, subsequent million original brands their are have repayments profit repaid Now

This our and adjusted continued adjusted EBITDA, adjusted Regarding have model for capacity from asset customer in significant mandated led XXXX revenues due of EBITDA, both for XXXX consolidated to primarily a adjusted represented Because quality XXXX. was high only earlier. CapEx dine to governmental to X% requirements, was a compared million it gross of decline million, CapEx discussed to The compared EBITDA. EBITDA our decrease in of traffic, very XXXX $XXX.X in $XXX.X low and restrictions to light resulting profit decreases in XXXX.

Lastly, we impact I'll pandemic due uncertainty of COVID-XX, provide review to by complete cannot performance year. for the of currently our the a fiscal for our as business financial outlook ongoing XXXX, guidance today, on projected which guidance created the reflects

necessary. because conditions business around restrictions of recovery our of evaluate year. guidance will providing dining performance improve are As the We're we development continue as the and to sales additional comp guidance this offering not capacity uncertainty lowered,

compensation million million depreciation approximately approximately However, approximately be to to expense $X capital flexibility, of sales the in has approximately non-cash significantly conditions financial $X To and approximately sheet to note that adverse pandemic. XXXX. a you, Brands between million. $XXX despite $XX expenditures I and can both Please and $XX statement, strong million Comp to of cash onset segment. expected million stock-based on G&A since projection includes the has including million restaurant Dine company brands tell the wrap inclusive significant related G&A is restaurant are range balance maintained related expected improved the $XXX of and the have company up,

lot we With to a for solid us, a over now have still that's work believe the I this there's Although year; Cywinski. foundation John of that laid of growth. accomplishments turn ahead call

John Cywinski

Thanks October, to new spoke. comp extremely Applebee's from our resurgence environment. trajectory. with our prospects adapt Allison of Good and fundamentally impacting In abrupt a the and sales X.X% COVID, in optimistic to experienced about good in this I'm to rather our Applebee's this business accomplished everyone. progressed very thereafter, minus proud altered in month of to business Almost XXXX XX.X% QX minus XX.X% we last here morning. we minus remain team afternoon, our of partnership directly XXXX. QX in immediately the when what model in country franchisees, QX

a sales As came comp XX.X%, minus December result November in XX.X%. while at were minus in

combined, over the were a very year. business that February of timeframe X.X% first comp from the weeks now January XX.X%, same good Now minus increase last its news strong is the in is sales three for improving rolling

hit restrictions, in back by casual Additionally, two important each these heavy we of Northeast Applebee's obviously spending restaurants Midwest December, scaled a brands impacted and February. in brands are disproportionately has distribution. penetration related not geographies, to the also given note restrictions geographic and It's restrictions. hardest by media dining equally our all January given its that COVID dining

disproportionately these eased benefit coming over reflected us, will as recent While results, months. ultimately the are in this and restrictions

has respects, the December business. rooms late our X,XXX environment the last rooms current of the changed mandates. context very of past dramatically similar closed are to all XXX were virtually For feels Thankfully, month of operating our at end summer open to In dining now dining for over year. our due many government-imposed in of landscape

XXXX. week when If here of we similar you unforeseen in I sales soon including our circumstances, sales recall, at barring first restrictions saw as very anticipate the eased, were to dynamic Applebee's momentum September. unfold end accelerate And positive a

the mix XX% for XX% To-Go Carside and XX% in, Now delivery. consisted of Applebee's month sales of dine February,

through Flyby On restaurant of now reach on partner convenience Applebee's investments being notifies addition continue the opened first throughout the our franchise drive very fully dedicated through lane point we across app guest introduction another night received relevance the Also, weather visible to our improves occasion. and in by eliminates throughput, our is a To-Go moment our that is this members guests. perspective past brand recently Geo challenges, From This Applebee's called a with teams Carside evident packaging importantly operating important late Without To-Go year and hours. in extends the third-party lot. tamper have upcoming question thru to delivery off-premise broaden driven front, and of arrives over enhance or off-premise drive guest window, Arkansas reassurance. well the deployed fencing, team a

to performance. easy and deploy such designed without options brand continue guest the for facing provide for once Applebee's indoor leading as look meal, with pay initiative business, from room Most year as to And as will the dining Applebee's firmly gravitate need for to brands a to unmistakable one I anticipate will that can digital positioned. a naturally drink. long trust payment indicators confident on-premise This throughout our this with escape Now, respect proven pandemic. where have believe that to be be mix which another year, good metrics, overdue returns, naturally perhaps I and a intent Applebee's core is the and this and On over XX% an dining front, connect visit these they importantly, is brand strength guests have affinity sales loyalty home to very service and again guests gradually optimism by elevate our as go their mobile technology, we'll exceptionally earned we're reliable of progresses, our supported well strong server.

like to our Now, to brand a take evolution. I'd discuss virtual moment

As audience meal targeting may the X,XXX Wings At concept XX, Wings younger we Eats wings February Applebee's a via moment, Cosmic brand, introducing know, and Cosmic approximately around fully remains just occasion. online only you virtual on Uber delivery available launched through an nationally a fulfill differentiated the kitchens.

addition to our Applebee's, a our partnership hot wings, bites. In to exclusive Lay. between developed as This original tenders and PepsiCo Cheetos, Frito cheese well innovation Cheetos flaming franchisees, marketing proprietary wings, onion craveable menu as team and The Cheetos of and culmination rings. is of the waffle culinary wings, work and fries ongoing has teams,

very too averaged And we'll call. $XXX conclusions, last quantify While to results. next to ghost position of any in per demand in currently attractive another online been better its clarify, build pleased Cosmic two one early We've sales Angeles kitchens, Applebee's The week designed to first small To right the full partnership in incremental a have of in here the a in presence, draw day operation, front delivery with Wings be appears these it's low steady to from soon in restaurant impact Wings Miami. Los day. be our these business model We're feasible. week, Philadelphia, a far street showing ultimate we our satisfy piloting financial with in also to penetration. don't with a for Cosmic may brick-and-mortar presence certainly our first restaurant footprint initial kitchens in where on are open franchisees, geographies investment, active and where without capital not of

than extraordinarily is engage to event, it's national in referenced. resilience the know and presence franchise in reflect dining I To we Applebee's our shape, this ever, any fortitude of in the boneless week, their there's for rooms media for our brand with point, our with year, great perhaps national the this as or now, eating partners, the whether no to this And us good reestablish I upon family we America well. last as allowing relevant messaging. as than fund which burger, compelling John wings launched of positioning Now, in ad Applebee's, genuinely our is neighborhood thanks five guests a more our rooms, environment more resonating $X past purchase trust latest

post in America's our XX marketing given demand ago. an year need along highest strategically since weeks I point inflection noting believe innovation up I'm achieved In We is very our around the soon. And this very to environment. does Jay. a volume single our week, of the dining fact, out week, I'll mid-March resurgence tactically agility they that occur, plan, that's closing, positioned contingencies to it is Applebee's indeed franchisees worth but partners potential pent-up full of year sales of again saw for this year, our pandemic not And well with the turn environment brand. real. only franchise return it near year, until when outbreak Applebee's we'll last are with last sustained aligned and very With also full It's last in pandemic we in this to unlock the trajectory the growth, see for confident to is thrive Applebee's In and obvious virus. and this are the that, that

Jay Johns

John. Good morning, you, Thank everyone.

for very IHOP road ahead the We optimistic are for reasons. several about

First, comp net for XX percentage the X% from improved quarter of reflecting began. XX the quarter, a fourth decline XX.X% the second a decline pandemic points to a sales meaningfully quarterly since of increase for of

demand are a strategy eased, in to dining brand place from restrictions we the benefit capacity positioned Second, have well and when capture it. pent-up on is to

are pipeline new strong development and pursued. our remains being Lastly, opportunities

the close we par with As is a comp sales dining which XX.X% family IHOP's fourth declined in quarter, on out category.

resurgence six were was performance, in the in Texas, adversely especially California cases. comprise Coronavirus restaurants. XX% weeks final our domestic Our collectively of impacted impacted which by and particularly approximately the We

down XX.X%. XX.X% XX sales Our for gain February representing XX to minus improves result percentage a weekend February's of December. XXXX points from in through were comp January

period, dine-in, To-Go same and XX% consisted For XX.X% our XX.X% mix delivery. of the sales

we part offers have drive sales number PM help the in address in number part it's happy not teens number Day value, the drive Day alternate two, will growth. also in focusing IHOP compared ever-changing on available. where growths. location. driving Number rest sales our XX, in approximately mid happy strengthening whole the the and strategies during off-premise of more in we've PM This low locations play value, to of To effective wide than single navigate to to a IHOP IHOP hour the value expanding sales only brand XX% four that lift which and platform this options second environment, to hour but traffic to hours traffic and at week. an maintaining value mid development PM both and a any had on gains our guests important we our afternoon incremental on sales continue part evening new to digit we strategies later day. our first array the high believe three business, times incremental the or happy one, equates consistently As and and the September four of traffic depending for is our window time. want driving four hour and during We is

strong off-premise our is growing strategy business. third Our

remained becoming sentiment around is off-premise more shifting strong. the and has our accepted consumer As country, mix

off-premise the XX.X% for approximately XX% and dining of quarter by for after room the primarily XXX% quarter this that a proprietary this minutes Off-premise to sales fourth quarter. warm high for provide approximately color off-premise which the To XX%. growth We mix traffic. for amount restrictions a delivery of keeps even to accounted XX.X% eased grew To-Go the leaving total comm we and of Conducive more sales For our over restaurant. packaging, IHOP approximately portability by was significant fourth third believe time. accounted sales driven as XX menu capacity is of food are can retain compared our

investment burritos is which signature and to bowls wherever is with burritos very for platform. gears and and to results approximately Additionally, creative ticket capturing the parts. encouraging, sixth Switching and are new of Carside please the we of To-Go in pandemic implemented development, growth latest and new and with launch to bowls mind continue IHOP launch all media menu and flavor our full all XXXX marketing IHOP campaign. burritos easy innovation appeal based bowls, they we incidents across beyond, different without and our X% guests IHOP January. strategy the soft quickly with go into and we enjoy portability on introduced four at in this brand at day since heading our our grow as look order The a guests platforms. fourth The combinations, will past were designed onset our

development of of which franchisee a during that stable pandemic. the were result pipeline we a of our deferred First, have traditional as obligations part assistance as

Second, by non-traditional led is of our travel history five in over XX-year development which restaurants years. XX America with largest agreement Centers for our

by small that which of to we've resumption on finally, IHOP work and this the Third, our year. this our test concept, year. flipped to we expect developed new we open fourth And locations first intend a prototype

been in to us areas we might new We have To-Go able with expect it investment allowing penetrate previously. to provide opportunities for growth not franchisee a higher on return into

expect hindered the pandemic. was we growth to our continue XXXX, For reinvigorate that by to

update business. our an for for domestic on Now restaurant open

decline of cases September restaurant as This for restaurants restaurant locations system in was open spike open domestic service compares XXst, discussed December X,XXX, primarily or XX% coronavirus to in The in in restaurants for XX% XX. our to X,XXX was due restrictions. earlier. or As of of with dining the

Turning closures to the unit we restaurant guidance in for provided October.

with As We the on locations performing done our we're XX for and being XXX COVID only generally and in pre a confident franchisees last and underperforming restaurants an our lowest in heavy With these have severely the approximately our John? had greatly To based insurmountable turn restaurants. executing his closing includes that family we growth, This PM concluded system profitability. very a which Peyton remain call a out given accomplished maintaining brand expansion, We've greater close, offering have pleased that success franchisee some is of gains year. reminder, chance restaurants initial comments. over of pandemic back team grow development These the our with and road performing our the of six impact now AUV lead will a over closer four X.X optimistic and sales value, part to sales long-term up about the on the economics, months, better with million. program our dining. the I'm to to I'm ahead. determined that, level individual restaurant we the closures footprint restaurants coming of John well eventually very members growth. to for that units volumes And the replace position Day projection build below our against the viable were challenging to which lifting of underperforming drive what during pandemic. of strategies evaluated not and I'll

John Peyton

Jay. Thanks

tremendous a potential second I have thank during to team. of happen in We enjoy to confident their and beyond. meaningful brands Allison particularly same-restaurant in our that performance It's and of pandemic restore in But poised and not the its our ability will half significant John truly Dine Understanding, to Jay. because XXXX sales sustainable the leadership, and want trajectory momentum change are upside immediately. in I'm And XXXX.

lead our new and restaurant. guests to are eager franchisees absolute I have us who faith our our returned are team dine restaurant members renaissance. people out talented a will more As into and vaccinated to that

and We're intact. growth, continuing with remain long-term fundamentals strong evolve for gift organization. positioning driven a centric, Our data to Dine

take to pleased we're you. Thank that, with so questions. And your


the Truist Securities. [Operator from Instructions] line from Bartlett Jake The first comes question of


on off-premise really a But in of with a restrictions the been least markets I us understand regional happening with thinking their what's the thanks give weather recovering? and taking how the has And going how the in had then markets question. sales on indoor the can restrictions lot first been My have tightened. performed like when the In of stores sense Florida? how that of you like that. being performance. mix Great, is dining there's And markets for terms -


least those third revenue see. a off-premise was John the a I than see of dine-in. we're Restrictive But those like this where in to with full well, what Jake, of It's restricted it thirds In question. And see. we'd for see national the fact that point. anxious is Cywinski. what good saw mix you And he a we national the restrictions inverse few back surprisingly And geographies our in we we the percentage that very most results get geographies, inverse see that. won't our geographies not we the of quantify to two larger and to brand a perform suffice may say business average on-premise.

We paint variability, geographies a the across have some very as us, you favorable. to in for geographically, that picture they and country, significant reference are of geographies possible. It's benchmark what's those as


that performance up business logical, that factual. really - up I restaurants, moved asked that Hey, or only at of as most having of forward. opened it's the business, hasn't held To-Go those has To-Go and and about well. said other well there's lot Jake, I would correlation even business that of to it's restrictions not have up this think do an openings But add I that To-Go is maintaining that I IHOP. restaurants a To-Go most and might Jay as how business direct And say between up the Johns that holds thing you is John absolute think everything

one just the these do up, keys as clearly going better a So job. of to areas versus we're open


Is the sales question on and the began. actually the positive helpful since crisis average last COVID a really were That's John you for made the were that that same imply Applebee's, store last strongest sales on Applebee's comment that week's week? to Great. were weekly


to Suffice of February. Make three very that earlier was resist the not is which in release, a make week won't. two shift Number points. quantifying one, from it our weeks I'll Again, we But saw is it February. what disclosed last only fashion, that. in referenced I'll sense? a was through that trajectory the in say the significant favorable I data first in Jake, data it


clarify last And at on kind question the this which of But at. quarter, on side, on just those side, that two amount my want just wanted of just I and the here you really think terms does. IHOP. of of the of would you domestic XXX expected ended, I then I that is on the closures majority word think to the assessing in use to stores. fair Was closures then you looking closures that to the comment noticed I you that that the were a when possible, the domestic It concluded to just mentioned but were less stores this that clarify great. closures are kind than clarify international

into symmetrical already? this system kind some we're kind So growth? Or we of expect cleaned of elevated essentially has bleeding net up the been And XXXX? should for closures now set


that that think program come franchisees to and domestically that Well, to this we particular I work I the And XXX about those program that program; these begin a on with what potentially locations. XXX. research close. to special what was to your question done referring has was And a had restaurants that on mean referring to, up by with was

as course the Now of exit always over But program a at regular far as closures XX. other to as there's business et cetera. be that's going


program that involving kind any for is promotion any trying kind to of the closing? was there And system. And of lifting penalties up clean Okay. of


in and too, franchisees to in we're their program directly point. we any said the for Well, what of a et back program thing together. of But that the this together out on I is specific that that to with a over, going kind business unique of was on normal we details cetera. that share requests work obviously, we on of with how running review But franchisees way position at franchisees their many to with were system. a work I'm of those put on help the kind the portfolios fees not have too, this like the we rest work cases, so


comes question Nick Securities. next from Wedbush Setyan Your the from


a guys the number benchmark you since that just Is there now willing especially and internally marketing back to or you. a peer also, are at on is virtual sales you share target guys weekly a directionally, out there there? least thank Hey, is then like the brands,


Hey, Nick, this Cywinski. John

Virtual look there a year. in to as very we in candidly, the fairly you easy I new means QX pull any our QX the and year, full pretty did assess keep is when as to we this like On January you investment. front, bit on favorable going QX will and position quite a investment be light. media mentioned, QX back which marketing love look spending are at February, we're is brand, a capital the in your It's in question threshold mind on

well. sales expect execute a minimum performance. do operators threshold incremental We Our of

there's just directionally that call point too next. one in but market that to we plus it's improvement will tell could believe day steady to to significant upside the You early a we what frame percentage you beyond begin see Nick sequentially days we that, and is but from only XX I have

Nick Setyan

of I the question Applebee's it's And the of an of any and margin, the IHOP kind for both the some Got the the really with at going least it. margin of on on then just quarter, margins, then gross there think of sort then and deferrals. gross XXXX, that XXX.X is on outlook directionally a there reflection what's IHOP. is for recovery X.X, And

Allison Hall

Allison. than gross giving see an sorry CapEx. but G&A is margin any to other this The on XXXX not we're So, you'll G&A there's year-over-year and than related in profit bad increase debt guidance Applebee's XXXX - other


We have James. questions Raymond from Brian Vaccaro from

Brian Vaccaro

date on had I afternoon. to trends. good the questions and couple a you quarter thank Hi,

the the mentioned You there. sales comments seeing improvement for I weekly brand. on And and you're appreciate each average

I that that comparing just December? wasn't of sales he AWS on and or each if up to brand you the so the could average think quarter, reported said we're compared kind weekly X% quarter-to-date, disclose for that's Could sure page? fourth same were of you the in you period? in I to Applebee's So high kind

Jay Johns

you the the about in IHOP. This what is you about fourth Are quarter, in - talking talking Jay

Brian Vaccaro

quarter-to-date the In No. period.

trying improved sort but basically, or that get did mean? versus average that what sales both in that weekly of versus a to just quarter, current brands? the X% Is you is the You December around does for XX check fourth

Jay Johns

percentage was we improved January. IHOP December actually, had Well, we have XX comment from for points I think into my

were QX, we down things when six struggling. were weeks of really last the clearly, So shut

We in cities going we're the to is way now. if a to trends the weeks the closures you we and have of And were six the I specific to great right as open progress little to correlation quarter slowly right that I'm year, all numbers and now, the give sales were any making in at on year then want January, I don't the we a nicely last going But that's see And until our where going bit dive the related to look come directly real that out coming starting back of that. trends took direction. trend on are of that back up is February. seeing great back last

John Cywinski

with just early part impact pretty believe as I national the percentage February down those were referenced mind we C, some we and marketing, a beginning meaningful similar the impact. weeks, believe, of of XX.X%, the weeks in points meaningful February. and December, is will in I a XX%, move in we front significant to and about referenced, which for This have the of first Brian. Hey, Applebee's down weather couple - as XX Keep are favorable John very seven then at reengage now XX% January way quarter, I has

John Peyton

Hey, is Peyton. Brian. John This

question the sure and we're make I answered to answering Just it accurately.

the So the one each that improving week make relative in then sense? February for last. prior is number of weeks comparing to those first and And same we're January year. weeks February, seven to of January, Does

Brian Vaccaro

of that. terms to I in that's wanted no, ask given also, having to sales. open rooms the And just helpful. dining And important Yes, is overall I it. you appreciate I how appreciate

and XX% terms rooms today, was But of XX% number Applebee's, In IHOP in open. like what but it of said are of I December. percent that that end think that I does at guess at look like dining units you look the Applebee's the XX% of does what today?

Jay Johns

we've may about are only some for a mostly We've now that XX And To-Go not heavy XXX patios obviously. or California of form got doing right right that got restaurants presence business about still got be open only in we've now.

impacted. and still a lot our restaurants are of there's So

John Cywinski

currently news. the half California in front, on soon, very And open them to dining Applebee's Oregon. closed, rooms in be Brian got about those we've great is half which XX Expect

Brian Vaccaro

that what's to Yes, in perhaps 'XX? expectation take that's year? mentioned shifting unit 'XX? Or at you side. the great. return in assuming closures appreciate guess the then little gears no net I broader narrative, I a a Applebee's recovery on And to IHOP into could IHOP this update bit development at And you side, major the the COVID setbacks reasonable and growth to will expect on Appreciate

Jay Johns

the this Yes, IHOP, on Jay. is

the exactly in any but yet giving we're have guidance are franchisees on developing, they're We On to is just in going interested that they're how how see this middle the IHOP, so in play plays to out. out. going still not clearly which now, - just wait that we're COVID and still that of back, rate to at right have comes that the

John Cywinski

any certainly we as we're forecasted, John say, unit Applebee's, regarding question collections non-viable very environment, up other difficult superior. three you of X,XXX know We've kind or over this the much framing four as the royalty we assets this haven't optimistic of are it's cleaned point on did. But advertising at franchisee portfolio And in referenced, last expectation and we'll your resist time? number time on about over to Brian, this to And, in this than years.

Brian Vaccaro

I highlight on wanted the worth to ask an enough. versus on then fair And right, your some timeline differences comment Or other wings? Could Cosmic expected is perhaps there? to missed offered are but key there you All one for Wings Cosmic be domestic concept mentioning so it all last I when or it, might me, locations? And from on on marketing of X,XXX that Wings. if differences neighborhood the approach just

John Cywinski

proprietary Brian, what last brand several in brand in menu clear. very virtual year, as itself, and in perhaps be we The XXX we be Wings itself positioning and some so needs worthy. of separated I'm differentiated to was we from glad know, did learned respects The piloted terms you Neighborhood needs Applebee's. the restaurants buzz to and

that that able a naming skew, demographic what execute notice youthful, or question quite targeting, positioning that had incorporate along naming felt demographic we more particular, specific that with consumers Cosmic a the well. with lovers, we again, very profile, Brian, teams be delivery And name important. exceptionally validated was male to the Cheetos We and naturally that, us. demo But in the word bit bit the it to And did with your to here given on resonated wings and in need timeframe was of well Our you'll the so Wings, the not that a we a brand lovers. Applebee's question? lovers,

Brian Vaccaro

it'll thinking about domestically. when the Yes, just WINGS will units and think - offered think when said system is it I just you if it and was across be it wondering Applebee's from be I currently available COSMIC X,XXX

John Cywinski

distribution your would and expanded a I you channels? obviously, own be with in so brand they unfold, will we received. can strong Eats Yes. presence. partnership have have terms expect the is but that where very how XXXX of our with this presence, And strong draw Uber Could well conclusions, I'll Brian, may a been resist it's

all anticipate would I forward months. first after options exploring so of And couple moving the


of Your next line Brooks from question Todd comes from King the C.L. and Associates.

Todd Brooks

Hey, thanks for taking my question.

other weeks weekly had it's for they've consistent of the of storm but if tough a been remarkably could some seven maybe IHOP Texas sales, we actually south and talk couple and down that weeks couple across and first especially looking still the First, and weather the a weeks we stores weather states if of a at just could Texas, brands had tough impact bit days in surprise we've lost belt Virginia, performance of to the kind like Carolina the so maybe North and about of the quarter a looks down to that talk it Georgia, south. that almost me both due given IHOP winter are store we of

Jay Johns

restaurants of side interesting closed important were down, there's XXX days absolute across system side, probably about as spread Well, multiple I that impact across it get most about we country. weather think we before, close our talked Obviously, is our what IHOP for like capacity the as weather had thing. that we because of the on drivers on restaurants the

related we say it. far well. on as the impact big don't total I Holidays a to have teased out impact as clearly, could some impact, of we've think So only information the are we for all us as is that.

odd weeks look lot different So that just different run quarter, at the a week. rate so of a a holidays, it's you lot are been compared little to a regular of when far, first

Day the hit. past have year momentum to this This were through gets the we rolling National we year, going events. out soon As from moved spread April and started cancelled as we to one Pancake which week, direction over weather than a last

are a don't of lot sync for there up just things that So while. a

So at on going may you is there's seeing lot a because you look that inconsistent this when odd numbers somewhat data be it. just in some

a restrictions I back I happen we direction, having a think the is trend that forward say, this right big are lifted. you at little hiccups move to take the these I for keep is the about as but right though, us picture, if on and general nice weeks, would look that are at trending make look step the given feel capacity we

John Cywinski

quantify we January the the And than been of Applebee's had would sequential less to weather on a not impact. won't improvement It's basis seen of little have weeks it. three February. from Todd front, points I XXX it for first

Todd Brooks

Okay, great. not. on the going can or for I But said this don't driver Applebee's back has you IHOP we if national commented you That's week you positive through when of into back Can helpful. think been to those Thanks. fiscal sales back the national so. hope advertising then talk in wise, into QX think start I back Jay, yet And you're lifts there going John, especially such is share in recovery the past advertising half store or same on that about into we the QX. get And weights, voice and now second maybe year. or bigger then leg a that's talk out as anticipated you in for XXXX a

Jay Johns

This Jay. Hey, Todd. is

what front, marketing as kind some cut the big would et we back see of the never digital via on always one-to-one, TV marketing we or completely campaigns doing you dark, were national On we went some larger the cetera.

a for have to things. we our very little innovation we're year, and we And both and the this differently a confident come on year, great just to market have Applebee's, plan with budget we with are like based going how So just cetera. capacities et marketing spread

a I money. plan, feel should So very plenty we good got really comfortable, we've have of

a really doesn't things to long think to money lot a do we're to promote. to we're have as going of of bad, that get this some again, And going bottom kind have when nice quarters. of of we was the second, I and thing portfolio COVID resurgence, fourth As into fall it's out third, the which

John Cywinski

know referenced Applebee's are dine the out. restrictions have side, brand how something we ease, didn't more year year, has have the on we we you performed as this that Todd willing guests and last to And that

So not of pandemic a they as positive that pulse and the of a XX% minus from September, five-month we what speak. through timeframe team where is week trajectory do that sales. And on trajectory if perhaps you really referenced rationally seeing our out saw message so messaging how May we right evolve of year, year. than similar, they anticipate to and look I the have it finger that over really better something unfold you're now. start And this last will will understand we And to our we last had pacing emotionally. exceptional an guests, to And sequencing with and first of both move that and


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

Brett Levy

Great, thanks. And good afternoon guys. morning you from Good to us.

in I else not shareholders, for the you. And immediate If but you paid you're bit you then John franchisee going have in at capital question be to a a little support. the Obviously, most of can about what thinking allocation could just debt look do the more to but and the infrastructure, is terms on investment how also you and the when talk plans. biggest down Peyton,

Allison Hall

$XXX borrow So at this We want do to time. the industry March, of we month. down pay variable very the our point, million continue strategy, this to this we're the at are see because which obviously, definitely to we to in terms capital wanted dividend. in that We allocation conditions going look at really can't

at But of and believe it's investment to both organically difficult really shares, none repurchase point, the conditions. I anything industry data Our this organically. do just

Brett Levy

names, what not the wish on your outside but front? if were your of criteria you the kind are On system? make M&A list you Obviously, To-Go for of looking own

John Peyton

Allison and that. John, our third well. that bit from obviously comes shareholder, it looking there's, in the technology Cosmic and there's return It's shareholder just learnings a take mentioned, as investments brand. possibly but capital, little thing to also based Brett. dividends that tack a brands And in I'll the exploring acquisition when the onto Sure, of thing virtual last we're about upon Wings, buyback, at I'll

be think When XXXX that but tuck-in at to substantial as toward looking and it comes M&A, enough of beyond. we're that it, with we - we're certainly we're do all looking it's it, So the that, the accretive we'll and about we potential at or look a when certainly brands we're our complimentary to with is existing not to of category to close segments that to the in current size high competitive a our in, growth grow brands. interested acquisition, two

Brett Levy

you low your do capacity impediments peers? your John, not and you concerns. as the to you from are viewed share hanging as largest but because see to just about Where then, challenges what still things you the meaningfully And take opportunities recovery the Dine story. outside and see restrictions, fruit? do in the for challenges Thanks. greatest to obviously talked just And all you that And now excluding positive, as join of those

John Peyton

you. Sure, thank

us the get that in other see vaccine, community we are a optimistic reestablish short is the hug So of restaurants to term, people other anxious sense that. to And and all out connection place vaccine. people, that do people biggest the opportunity are and of is and vaccine,

takeout delivery the We that incremental our us. to weren't we our that dining. we're technology brands. above a for now term, before, We we We to investing because it's somewhere think the in deliver. focused new to are - way Over long And think on we necessary and off-premise throughout been in don't in it's consumers growth the think demonstrate and think that think for digital we've introduced is we facilitate we set settle to off-premise the where going were pre-pandemic. we XXXX consideration ability in

So by is in dining, the digital our things investment like that. one for off-premise certainly of future facilitated and the best


closing I that Mr. turn the to for John the to we have And today. would is any time you. back know for Thank like that Peyton remarks. questions conference

John Peyton

you thank all of you say questions. to want Just to for your

forward our and me, enjoyed And of And day. throughout talking first throughout day. conversations this the looking well the and and veterans, the thanks and and all we much. so we interest to to your as of our John of with Allison the Jay, and forward our speaking to time answering appreciate for question well. For your investment all to is it. you, in brand, Thanks I'm telling you story very look the company


for today's concludes you all This joining. Thank gentlemen. and conference. ladies you, Thank

all disconnect. now may You