Red Robin Gourmet Burgers Earnings Call Nuggets: Remodels and Food Costs
Will Slabaugh – Stephens Inc.: Wanted to ask if you could talk a little bit more on the remodels, about the ROIs you’re expecting or maybe beginning to see at the newly remodeled restaurants. And I know it’s early there, but it seems like at least it’s safe to say that the more intensive remodels are providing a superior return.
Stuart B. Brown – CFO and SVP: This is Stuart again. We’ve been able to read the results for – most of these have been done for five or six months. We want to continue to read them and watch guest count trends, but I can tell you, today the full remodels are getting returns that are over our 12% hurdle and that’s about as much details we’re going to give right now. We’ll be able to provide some more colors as Steve said next quarter.
Will Slabaugh – Stephens Inc.: One thing else I want to ask you about the premium test that you mentioned. I wonder how big that would be, across how many restaurants and then if you would be willing to tell where that might take place.
Denny Marie Post – Chief Marketing Officer and SVP: We’re starting small with a select number of restaurants in our area and we’ll measure that first and then decide what’s next…
Will Slabaugh – Stephens Inc.: Then, just lastly, if you could talk about any sort of inter-quarter trends that you guys saw. I know it was a very choppy quarter for most, just maybe from the consumers’ reaction during what turned out to be pretty volatile months?
Steve Carley – CEO: Yeah, I think what we saw was pretty consistent with what most everybody else saw, although, I don’t think we were hit quite as hard in any of the period, so again strong January, I think February is where most people fell off and that was a tougher month for us and then some recovery back in March. So I don’t think we were that uniquely impacted.
Bryan Elliott – Raymond James: A question, those were a few of mine actually. But one I have, Stuart, did I hear correctly food costs – that burger and cheese costs were actually down in Q1, and I think I heard you say you expect commodities overall now to be down for the fiscal year.
Steve Carley – CEO: Hamburger was down for – year-over-year was down actually in the first quarter versus a year ago and in cheese favorable as well. So we expect commodity to be favorable for the year, but not down year-over-year. Looking at where hamburger prices are today we expect hamburger to be favorable to our previous guidance, really for the whole first half and then really start to pick up more in Q3 and Q4, as we cycle with somewhat lower numbers. I mean also back out the other thing on COGS is we’ve renegotiated our cod contract and we actually sell 1.7 million pounds of cod, so we’ll have favorable cod pricing in the second half compared to a year ago…
Bryan Elliott – Raymond James: On the timing of the Creative, the new campaign. Remind me, I missed the details on that one, is it just breaking now or and are we doing national cable from right from the get-go.
Denny Marie Post – Chief Marketing Officer and SVP: Yes Bryan. We are on national media including network, syndication and cable. So you might see us pop up, in fact we’ve launched in the boys, so we’ve got some higher quality programming than we’ve had in the past. We got two weeks in Q1 and then we’re using a pulsing strategy throughout the remainder of the year.
Bryan Elliott – Raymond James: As far as percent of sales going. Is the selling expense that we saw in Q1 in the press release that’s the same basis that we’ve historically seen – I think it was called advertising expense prior is that right?
Steve Carley – CEO: Yeah right, exactly, but sort of 2.8% of sales and that’s our contribution to the fund.
Bryan Elliott – Raymond James: We’re continuing to hold that as far as planned spending now for this year, although we’d actually pre-booked that, we didn’t spend it in Q1, we are going to spend in Q2, Q3, Q4.
Steve Carley – CEO: Correct.
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