Texas Roadhouse (TXRH) 3 Aug 202020 Q2 Earnings call transcript

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

begin call. may You your

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

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

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

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

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

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

ensuring our a you. operators face. unique continue now they to guests, curbside our the that Texas historical months, of these service, remain our compliance our their restaurants to they words outdoor while as added along legendary for top a Thanks, are take guidelines tirelessly upward the with difficult Despite while has food well of and and operating four Roadies. dining half through to that of in they a seen the thank make last momentum have local never dining From time culture pickup, March Tonya. a of and Their and And challenges philosophy. -- They every adapt go And Legendary to and has events deserve this, all find partners have Roadhouse XX set despite show a safe simple the added has circumstances care environment mission years. ways have with it's employees providing pivoting their now the the only over paying-off. responsibility capacity a a to execute statement guided same continue work for sure that for jobs of their capacity rooms, cornerstone limited been to daily back the remained at to remained managing traditional taking of volumes more above To-Go of creative it sales To care priority. efforts our levels. managing our huge

about, second compensation, talked safety temperature frontline long-term. added then and dining the of on that focus XXXX, approximately And and we folks. spent quarter both we continue million on early in in our for previously surveys, have I'm sick to our will their rooms. and PPE partitions our and pay symptom on, near to benefits employees $X.X have since we proud we As provided particularly checks, note to added

guests remain brand showed adapt. us loyal our to This our quarter willing are that and to

capacity. in also restaurant XX% margin sales reopen cash of company stabilized improved positive our cash position a to financial June. restaurants their quarter and sales dining operating saw return our the saw And a as our volumes increase. over limited With with our dining through As we rooms results we in and rooms flow our improved

some that with moved restaurant the placed been have new We had forward on March. hold of development in

additional Texas forward have one four Roadhouse XX to July. sites including Bubba's the this moving restaurants Jaggers. end on and open year open additional quarter, that Texas second the two the in could open quarter two during eight We we of are opened we During in one locations before Roadhouse’s addition with plan construction

it too expect specific to year, on get in continue the we development opening next for early XXXX. to is While new restaurants

We sure our legendary restaurant Roadies that taken legendary further of, We to operators are know To-Go will have adapt. ability and over of remaining on the believe us support our that day, the prototype continue our respond it's uncertainty way, and to could been our changes handle end in the and the At months operators Roadies higher they have resources and building dedicated enhance with also to confidence have care on focused food and working of our and about comes also make of I volatility will what that coming center full need. quarters. the to remain Regardless us our sales. potential I ability service.

Tonya provide update. Now will financial a

Kent. from reopening We about continued improvement in sales which were and XX,XXX climbed company to Thanks, see Average dining second of throughout sales weekly the pleased all for the resulting the restaurants room quarter July. into XXX sales for June, dine-in weekly the limited operating XX,XXX restaurants of June nearly sales. accounting those average over To-Go to and capacity with XX% of a generated in April in XX,XXX roughly model sales under

compared slightly based is for restaurants this company year. the with continue along to restaurants just almost seasonality will Saturday our normal on this started-off we sales trends at the negative higher recent to level limited due a foreseeable the over for of July Weekly of XX,XXX holiday shift X in lighter with June July sales see sales Our July that future. to impact to dining the capacity to all averaging XX,XXX. of moderated To-Go expectation of

a slight sales we Additionally, in June's with several states have in performance. weeks, increasing relative to moderation restrictions seen recent

sales on XX.X%, restaurant periods Comparable not average Restaurant overall respectively. XX,XXX these weekly has our On of quarter decreased in June our material calendar and mentioned weekly our for return April, month sales to XX%, July percentage shifts including sales as week remains have period XX.X%, for to performance. of pleased States average, sales we X.X% most down of to a sales X.X% impact are enough to for above at the negative sales the and the a restaurants significant see margin been comp were sales impacted average second declined the over moderation impact this last overall Comparable second However, approximately the decreased from earlier. our and quarter. and July sales total May comparable in an XX.X% by for period. XX.X%

have margin by with expect is and levels, June sales margins sales positive the this earlier in as certainly months. the While our was to by to of line At teen sales current negatively quarter. our well To-Go in a the levels, benefit beverage below a second we over typically restaurant Cost encouraged coming were margins mix, pre-COVID monthly do XX.X% we the restaurant margin low-to-mid sales of especially period. increased of pleased impacted as a This transactions higher generate attachment. the of total quarter trajectory in returns to higher the not these percentage the

Additionally, second of commodity for to quarter X.X% plants. the inflation shutdown costs as of due processing quarter approximately the beef driven back many primarily was half the beef by the in higher

increase sales compared XX.X% per second With seeing X% percentage these wage are of is partially hours non-tipped store facilities hours, offset prior total the in Labor other to rate number to XX.X% normalized. as back position. by inflation. year and which week down including To-Go prices online, period, dollars of the of wage supplies in Labor XX.X% a to wage and were we a increased it's Higher the quarter. increase declining of the due

additional well mentioned, as sick as million relief Roadie approximately Additionally, frontline pay quarter in as $X.X the Kent we second costs in incurred employees. our benefits payments labor of to related to

Other XX.X%. personal masks costs sales supplies. expense protective other impacted equipment other costs Finally, volume negatively as lower as gloves, purchasing operating sales and a of was the well operating the added percentage by as and were total of

a from margin, and of $X of Moving year of year's cancellation savings reduction The bonus $XX.X decreased equity below quarter the Partner G&A compensation of million million costs a meeting restaurant as decrease to compared the of $X.X million and Conference this expenses. reduced $X.X million drivers cash the and the period. Managing primary for travel prior were

is ended to assuming to revenue positive more in current G&A on The were improved proceeds and July, sales primary the with remainder $XX higher $XX the our million of with positive capacity to We increase of percentage half the for million the and cash from cash the trends. $XX revolver generated which increase based flow under from cash, by normalized million working of June, $XXX the We operations quarter These million of of along first a drivers inflows XXXX second $XX cash capital with quarter. for million offset of operations. expect level inflows. restrictions. operating The return flow restaurant were the included of current the sales flow end year same expenditures. the in a do as of back $XX we performance of of -- capital quarter up expect from cash in and In million

will capital the plan Kent based to restaurants outlined on We the new continue development development allocate earlier. of to

capacity However, to rooms. We accordingly. further the state local reduce capital begin in the guidelines reduce to that expenditures dining extent would and

to they heads care the strength keep Kent's employees. reiterate our like guests continue of Despite I'd Finally, comments to taking have operators about of up we concludes but on the stay strong resilience our their focused future. faced, and course challenges the and our Their also remarks. line for questions. other. over each brand please crisis, only open keeps this this compassion the not what are the and That Operator, and prepared of into our

Yes, of from Glass question Stanley. from John ma'am. Morgan your one Instructions]. And [Operator comes first

if about the total? the now have talk added? shorter capacity what recently? you [indiscernible] Thanks many more how experiencing kind constructing very number much. My question capacity like is that go is you seen or I've outdoor do you impromptu are restaurants there's patios, improvements How a room underlying in to is you've you of that-in of comp Roadhouse’s maybe just the capacity, Can seen that And lot, i.e. restrictions think much will periods? still to dining parking the

take you that Go afterwards. add and ahead, Tonya I’ll

to on XX.X% Hey, mix little just -- the and XX. I'm comp, were would XX.X% of John. XXX% just fair for we've pretty give got a I restaurant limited -- color Oh, down was keep were I a going July to up restaurants perfect. capacity [XX/XX] down sorry, there's okay, capacity that’s

dining a a this exactly And XX% or seeing of across capacity results of XX%. the different Board. lot we're upward mean lot So, level without don't times

sales bit the sales -- the weekends, in in on of in volumes be higher week. the improved run week. across or days sales expected the And earlier a higher sales seeing our earlier we're week decline in levels which a how would So, lower decline given coming typically little

definitely opening working they're as can. earlier to of shoulder opportunities outdoor see our they we So that as a like taking get shoulder little having sales that, things bit dining, to operators advantage different much

we were degrees. outdoor like, Kent. to is a now Texas to do in of lot it's able some its XXX This And then related weather dining

So up little you California, of like it's And so effectively outdoor just that been it's better have dining it the cases. in well, where a weather different. in for Minnesota, depends places working Michigan then we're has doing on there. lot except shutdown

much. very you Thank Okay.

Oppenheimer. And from Bittner question comes Please Brian go your next from ahead.

looks business? business It or it dine-in sales. relates XX% -- of for guys. steadying the the to Hi, to Go out business the expect around you it forward. like this at Go-To Thanks. And just sales understand core profitability To-Go as like continue help of share us moving To-Go sounds the can margins your are And

that overall, typically alcohol, soft Sure, attachment PPA to going $X Brian. attachment, has Yes, margin. a This less To-Go perspective. lose from is alcohol higher be is but beverage which about a just you Because that not beverage that do Tonya.

higher that's transaction, So that less To-Go from is tipped because it now perspective, versus position the inside a wages but waged you need typically on you're To-Go see what position are going labor restaurant. hours out paying to a wage typically minimum you

more. been So And from -- looking that. little We're maybe prototype at, making pretty wage advantage from taking have of the transactions those where where to transactions some to and going speak higher to, looking things some a reduce higher from you we've we're little to bit to at make really a looking just some help sales perspective bit a those Kent changes the technology that opportunities those carefully might a impact to standpoint labor at gain understanding to try, are there. we're easier a To-Go bit But, efficiencies. little there's reduce want

this Yes, Kent. is

door it, six figuring how on Our either or sliding the our operators It's put curbside out up been a window from all rooms next awesome. of put to walk have a feet part waiting away it, take window. to and on the window

that this volume, back additional even adapted XX%. you said, we So as that volume will on our get XX% to even additional take we stores and really buildings believe as or to continue

you. Thank

line of next your question from BTIG. the from Peter Saleh comes And

cash sales that just correctly question. It want on growth you're comment. -- Does at for self-funding. about hear and of taking about in sounds Tonya these maintenance at to CapEx improvement. the include the ask level, Great, this on that Congrats thanks CapEx? self-funding I your terms flow free levels growth? the I Did like

-- seeing, June. a that's sales that perspective. enough what in higher our from With we're that's Peter, that's that from cash able help Yes saw we us were flow volumes, yes, to true, operators were able create we to operations to -- what

some just inflows benefited we did expect from we So of to timing see kind working capital have a perspective. that to going June in forward, that us

new also store but offsetting of So assets. does that development from a existing and maintenance include CapEx

To-Go are XX% on you look that capturing in think these Are sales? different in customers of business, you just a you using new guests coming in just then in And these when at this way? existing your totality and this you're Great.

Kent. mostly ours, we've is they might going I that been and to This of I've had safe they guests gotten before, in timeframe, that really with appreciate done but how to interestingly would enough some restaurant And stay not more April not specifically are going whatever say, mentioned March, people it. existing they're the but made guests, we've letters, regular everything said, us. have it's they back

absolutely, made of So lot I we've new think a friends.

much. very you thank right, All

line The next Tarantino Baird. of question the comes David from from

from a unit question basically my that really growth I about But taking of you're growth what think perspective opportunities restarting a the take Kent, you look wonder are coming could and It you're and outlook. like there for mean advantage this pace about talk seems the is seeing after that and about out afternoon. you more XXXX a thinking XXXX you can bit good you if might pause. effort real year? Hi, as in of estate of that to beyond whether you what

Sure.

XX. that So no, we -- would would like year, over been this XXXX be have

kind of say -- next already we year, over so. year push, next plus So was and looking, the we XX XX plus

those XX. we So push can we're seeing which of now to stores

will months. But new next lot it we and with or that within closed. haven't the really of because like from that So can't open saying from this we're be it you, people chasing tell we is been we us honest a people leasing lot the restaurant buying of stuff build we a closed build calling business will XX there's this or this

on I yes, availability would the is So definitely increase. say that the

think the And if is development, few comment normal given can opportunities more that on do year to meant XX you to mentioned year number your imply numbers that surpass next about that next think you're years a that you you the range maybe or of seeing? be -- could

the give answer. next us tell Then could an be you That great. for be would to I if occupancies Well, four what you our going months?

the ask recapture if current can would you XX% of What XXXX Tonya, then low-to-mid mentioned that to I margin the And that gets or sales the used margin? a in imply that you level? would to you enough. back restaurant XXXX Fair it you teens were that be So than at have and range would higher question XXX% you that? about were sales into

work that a much than what dine-in dine-in think How To-Go to on transaction. mentioned were. margin sales little a the lot bit of depends maybe I a because mix would as different I earlier has versus go profile transaction

maybe To-Go more I that little helped then would a would be that. transaction to from our lot And that certainly profitable on have perspective. So ability think depend a

get depend to even move we've it's and kind things I the of is how a to XX% range play it on think lot with -- out in ours able would probably -- a that back be XX% maybe So to certainly further. like just and things But, just that. of is going to would that where mix sales -- been to more goal that of be

thank Great, very much. you

question of from line the Jeffrey from The comes Bernstein next Barclays.

potential see I in your terms the about can changes core the the energy if just you year ‘XX, keeping pandemic as growth delivery think different in give pickup it's new much. that earlier in context unit like brand? changes on a and boxes Kent, the wondering is behind but prepared you mentioned in in some outdoor I this from opportunity the all unit of the in it you building, of very or the just seems thank know thoughts back Great, going remarks, the To-Go, the mentioned sales I'm you to more think terms maybe dining, more in I'm wondering, ‘XX, whole just of Texas any of any kind you it's you be prototype of so that.

waiting we've Sure, basically, now an that our waiting way then would call had and slide an become you then example, And we're going curbside folks rooms on-deck we're outdoor door overhang we space goes or To-Go on in but room cases prior to and can wall out. just where call, six pushing and we it more put elderly that as And store the of outdoor our we to waiting in be that for bar that it some taking waiting and toward do spaced seating have a where can got door can lobby supplies, that half To-Go call, apart. area. feet we're that other some before that

depending what's have that for that on on going at that we'll to ability room pivot So time.

and during representing the Got no in any prepared there there of like future on might it. consider wondering there? if tougher, because less there's you And the excited but remarks brand. any more pandemic sales changes mention just you sports I’m thoughts or less and and It it's leave Bubba's -- little seemed and you was growth less alcohol the whatnot, then about a the that would

putting or well. of Well, in in And seating And in of which the bar and probably the then because got of covered in as not, some our component outdoor so believe cover TVs. put the not, look they're the garage there and TV it we best music you fans on bar, as group videos. of kind sports maybe patios area plus can as more outdoor And on, recall or may we in summer then more. have option are create some we that have we'll we Bubba's videos our tents have then no just doors we've outdoor and TVs out and some music, and chive to an when there's you

And so by up the when as you amazing six some you just from can dance in come feet your table. you stand food away table get like as long and and stay next

Sounds of like doesn't there's like But, would terms do. change that been hard be heels for the a enthusiasm it the so sound on in the pandemic. Bubba's of to

so. at not Oh, all more,

Great. Thank you.

The Farmer next of question Jeff Haskett. from line comes Gordon from the

Thank just to you for the case counts. anything helpful. you. provide weeks consumer off-premise and jump Florida, would Have Texas, of like in be curious COVID I six recently, customers States have guess in behavior change, I'm to looked terms in Ohio seven the more like last attributed you seen can

partitions, we've Ohio, came see and as restaurants really of some perspective. mentioned, and we've is though, those sales In comp of in XXX% did with from a Sure, had year-over-year. the it from in I Jeff. out and Ohio stores with moderation wasn't It's lot seen we significant gate some the performance they open This Tonya. positive interesting states, strong in anything situations a slight certain a

positive. pretty that's think I So

point at little but too moderation overall, nothing significant. bit again, So of a a this that's

we decrease quarters? follow materially up, and for about And Virginia should a that first then into XXXX the of thinking you just on be touch as How did half year-over-year back two XXXX? dollars Tonya,

keep the think, at level, of as gap] levels, would revenue a I year, the [audio like what those which of into we ways Sure, that half kind is assuming of in G&A total a the -- sales of look to things more expect to normalized reduce range continue all the current for we're that little seeing get kind X.X% percentage G&A costs back I to is it think where for learned ahead, perspective, time. normalized But year. some we'll I could the more we'll be a And, maybe just keep able feels little continue of to be this the moderated. and a -- bit And XXXX. that able we've like to learn looking even far from back that's G&A things continue so to into things year we half carry-over be to

our be goal. So that would

right, All you. helpful. Thank

Geiger comes next the question UBS. Dennis of from Your line from

days just thank dine-out was consumer But and continue frame of more restrictions? Tonya, expanding opportunities just week if color here the at you're you it if anything you you. else biggest Kent of to bit here biggest mobility periods beyond drive greater kind from a partition wondering further drivers restrictions current the cetera. that gains dining, the Great, Thank shorter outdoor of curious willingness kind easing, you. talk gave shorter about to on or good how recovery increased and dining, of could outdoor from looking et periods, within this is I the context you capacity to just maybe and could

from these partitions, And boosts us. partitions now are of weeks, things kind restaurants as our side that other us then Bubba's and restaurants. like to at and more same which a those all To-Go and to you big that did us then so put separating outdoor the makes We guests partitions. that. wall, specific lot restaurants. adding seem Kent. separating And they more we've as and I of help our done learned some can little we've the dining on rooms six I if have of all of might about as new locations outdoor the to other so are converting we of definitely we a tell a efficient would dining guests be the back existing adding quicker It our come To-Go want a boosts to the that diners with It’s we thing, to see more because quicker could mentioned took experience Well, those in and

Tonya, missed So it away. take I've if something,

No, on about I think hit you everything. just

party seen kind when on average. you about restaurant. reduced have coming the think some into folks It’s slightly, We sense size of makes

So job sizes We there. of like potentially may pretty things the that. some that did opportunity a there could be table and -- good

That pre-COVID one might be as really that. utilization only seat the like I would possibility. mention So and a and things

That's helpful. Thank you.

The line comes next Stifel. question Please ahead. from go Chris of the O'Cull from

Good new performance, afternoon, a it just I honeymoons? I thanks. stores was the the store probably seemed opening Yes, guys. had with are are implications like question softer new of wondering, about Kent. softer stores to honeymoons. What opening

tell have stores I that would Well, dining that quite some To-Go like well. are are we've doing that you new got that outdoor opened only and even

might there's think location any amazing. don't and be fair one it's the next is I doing trends doing one So just

newest location amazing. doing is Our still Bubba's of

the a I that. specific you just trend all a over So think say you there's have Board. unless, don't it's Tonya can thought on

lower come lot get now, I it, there's it gets learnings it and play underneath think the higher necessarily to a to of doesn't likes a any of with Now, right that store the those gate. don't from volumes right really, out chance get its good with opening think restaurants implications slammed I into volumes, those sometimes there's chance

as they see in a So good that community. a you build little positive can brand of bit maybe awareness and the

to there I even for can out go bit have certainly folks too. looking places right maybe think a you And that out think help little now. I them

it'll or restaurants? for the think for estate pricing to you market do to the long terms leased real different How need Kent. one, take last start one recognize Just

Well, thought we're approaching seeing pattern. now that folks some us with

been So would yet, more I haven't a deals cut already any we but little they say flexible. yes, specifically

great. Okay, Thanks.

your of And from line next Suisse. Lauren Credit comes question from Silberman the

Thank you.

three to limited times sustaining they opened [indiscernible] be restaurants capacity levels. For volume seem pre-COVID that at

return, continues prior volume? you think some pre-COVID on-premise incremental of or off level weekly as do to average of kind ahead your sales So with

well what of think it's a a the with I'll half you, increase in -- could capacity capacity about But capacity look possibility, see to it like. volumes I learn the capacity whether year crossed from higher To-Go store holds We think learned it's more To-Go XXX% restaurant. we we're that across and here Board. that going begin or XXX tell deals hopefully -- fall-off don't the pretty lot is capacities XX% be any like back XX% fingers these to I a

-- perspective, again I we we sales So things doing we're will build that those I continue all think room. think it along I to the focus with can think from we continue To-Go can dining with a have

where I committed this in or do think the of an sales? the requirements, dining environment how environment And the that you're and XXX% capacity Great. at room bottleneck then to is yield greater to and distancing about genesis capacity, do guess we the social restrictions demand point get pre-COVID

doesn't always of your all don't [parse], all may you mean social available have the because have XXX% you distancing your to XXX%, tables not with and you.

So at a lot of times you're not XXX%.

it's to sure. that we year prior their to for their got sales Now, the are if encouraging July, beating they increase down even XX%, pretty capacity stores in have them even see whether or outdoor with dining, that's XXX% so that helping stores could be numbers that we've

to So grow I think those we remain positive on able sales. being

to Yes, XXX% And yes closer XX%. usually this is means Kent. XX%,

much. so you Thank Great.

of line from Barish And Andy a next from comes Jefferies. question

guys, of ones. couple a quick just Hey

issues extra people of or with on expect payments First love any the and reopening the side, staffing any should XQ? sort continuing we into

back This is come We rolls hope to will with going off kind staffing Kent. work. happen through that. motivated on that to to know Yes, the it's what's -- and don't people we that more been tough the with and specifically be $XXX some government extra July of

weeks. next we've the see will will in until look It's like here. that what understand that experienced we to hard So weeks few another four

payments XQ? in at financially, continuing or should we costs the COVID terms anything And just of related into look

-- ahead, sorry I’m go -- but Well,

we're at at like levels continue higher to the afford. this not feel to bit to watch we'll now continue rooms think time, and dining Right capacity little continue of going a it doesn't I back okay. to just we That's this of reopening time, but I we'll getting evaluate with think as

Yes, in making parking the people inside lot tips. folks are serving are the that and

ballgame quite at point. So it's different a this

kept the terms you've go to family one kind things regular looks a grill like of sense To-Go like a give menu. and then you follow typical and in lot up think that. mix And quick full meals in Can the packs I the Excellent. and family ready order us or to what items of a places just, of menu

the to in To-Go Tonya, family few Sure, ready only clean a then pack recently. the mix, don't know is if I stores in and that grill

packs less the we're family pretty currently, now Right numbers. a X% of than total Yes, are it's seeing mix. really small what

you. Thank

Strelzik comes from question next BMO. Andrew of line from Your the

Good afternoon.

in restaurants. First question of the from independent me about industry there's a conversation lot been

so I could it do was anything maybe that some positioning capture you're if of your And in arise? incremental so to on you market market and kind share of comment some what curious should you're if seeing of

Sure, Andrew. Tonya. Kent. ahead ahead. Go Go is This

Yes, to tell. the or have we folks the I parking those independence. lot are them they it's outdoor have bad A the lot feel hard for that of in have. we really don't area say

so So don't it really have varies really city-to-city, on kind I insight of any that.

able as if dynamics been have chain you. beef Okay, volatile, how the or be normalizing Thank of mentioned I'm how prices extend will on up. is shifted supply kind you just those just curious any now, are holding comment to great? can and the kind kind prices you Have us, been so beef of that on of you coverage

Sure, this Tonya. is

Our has phenomenal just purchasing suppliers. with our of working job team done a all

been any suppliers really from beef haven't great got up plants just the after and they've all seen partners. at running, back disruptions So our we

like much we're I The don't something but certainly now believe that the what is what that color But, There's or we're far up to look think that compared demand feel there. great. to we that as it any doing So when to additional feels prices foresee feel for it it's that. certainly beef think lock feels we issues right to continue happen, giving -- and today prices going we too outlook we so any to we we good. the will maybe opportunity get up we really seems good. good, like that, seems but of on not anything locking We on beneficial supplies can pricing are want any have comment don't out any ahead improve

very you much. Thank Okay.

line your from next comes Ivankoe question And of John from the JPMorgan.

thanks. Hi,

be a in the actually a sense the may barriers of restaurant actually those because I on you to just what the a for the timing that a six there whether or what basis, may, the the different those have local this is has seeing I kind mean happening? kind of be as distancing, follow -- partitions to kind regulations on capacity actually can been foot of your if many number trend need and in So day-to-day those partitions rules do in override overall so And partition good. whatever you're seems up

Yes, this Kent. is

guests, differently. booth, You're biggest our at think correct, every them will just these And somebody view next the various a feel the from even is movement views differently. the is to positive them I But by air the comfortable state cities next trapped that within state also partitions. knowing them more booth

so takeaway me guests. the has from biggest the And to been our comments positive

is are terms or is level? whether level, local at know you do of you of – and in kind measuring a state seen I've consolidated on that which guys a or Definitely level regulation you the basis? trend local going that something And way on that that

Boy, it's all so much all the Board. over -- it's

then at down positive state point? of direction moving and inside it's you like think so sudden the hard shut to You a this the all tell

Definitely hard to tell, it's via.

question. was a Thanks. tough it know I So

[Operator Instructions].

comes from next Garber line Jared Sachs. from of the Goldman Your question

here had maybe rural been you if any to those for some change you've COVID. growth been get locations any to it market the sense And strategy differently prior, just question. in the targeting if there's of there? Thanks. you're maybe But relates as them prior smaller of I a Hi, than have been did want thanks unit thinking answered. to of Most about

XXXX I'm a and -- a is and bunch very been still pick when smaller year pleased development we these And smaller and Kent. a those year, we've lot it's these ago. picked days on yes, year No a a half site, open, at almost you you a books sales report, This for one as that in there we're markets still going the at on half like before the a of there's looking the cities. definitely

a very you. maybe a order, Thanks, help of have Thank between That'd of the follow you up. just if of or helpful. just of a order kind us maybe relative dine-in Tonya, margin sort the be I could difference could orders To-Go magnitude delta one contextualize two?

piece on what about a of be should the than higher $X see biggest To-Go Again, are hours, would there's probably wage you on To-Go. really, difference cost, PPA but it’s a paying you is typically, information have less those lower a about Yes, on PPA. lower $X dine-in a going it labor you're to

the of a labor stands. the any transactions as lot the side you labor tends really don't benefit to you're losing That's, get then those margin. attachment. to higher going a And times beverage of higher is cost on really, that sales it be on because that be So To-Go

So on little much stakes, tend because on from perspective, a stay more from you're to To-Go a as tend spending from on have bit is be as occurrences away typically And don't they typically you appetizers. cost to usually apps, those to see much of going sales you To-Go, bigger not a see perspective. you what combo

So margin higher just impact little a some that more that just bit also. being of transaction items, kind of

those the at be end on I day just labor the the the side. it really would depends So would mention, of Jared things

Tonya. great really That's Thanks color.

line Vaccaro comes question from Brian next Our Raymond from the James. of

Thanks Great. evening. and good

and outdoor incremental percentage layer an front, also different are on outdoor units offering currently the then sales of much what capacity On what you restrictions. dining piece the the share of indoor expanded at units average? operating that of dining, capacity percentage how contributed currently the has on And could of levels

of don't varies. firm have the number outdoor with a a on outdoor times the I'll because of count of we Brian. the you on really stores seats number Hey, dining, lot dining, tell

with accommodate couple You versus things that's just one all different may that. really have that with tables, can and tents location like they will of because tables picnic big have a that some

dining, haven't as up we there, to trying room the gone – those dining seats sales that of volume those with it's the [indiscernible] really outdoor quantify number the far or So right now.

that So perspective. that's -- from

numbers. a next biggest kind today's in be really breakdown, about have you exact, number XX% XXX the On capacity. would on that's XXX the the group XXX% a to And over restaurants the that is XXX capacity, bucket of then little restaurants, based be fall capacity in bigger

then XX% you and single-digits the about You and into in XX%. at point And get got other then that XX there the groups. XX% the and

Yes, yes great.

Yes, mentioned, Tonya now. this closer is six Kent. That XXX% people then might to is top four up that also really four be fill And you six where more a like with might to as XX%-XX%.

-- that's So

up, you that add going is system system is numbers more get wide are and yes, -- -- than when you're -- the capacity those company to Yes, and that just wide --

That's Okay. helpful.

it updated do if an sorry target XXXX And have but range? earlier, you missed CapEx I

No, we have not.

ahead have done Go that We Kent. yet. not

and we're moving we things shaking Now changing in don't go. obviously, because in know, as

As strength some that the we of June we and on saw just based we on. more lose stores July, had not lat plan

as So or kind really our two four each or of one let cash month we we flow reevaluate three or then go.

of So how it's that's days. kind working these

sense. All much. Make thanks very right,

Thanks. Brian.

call no the team. we to management over the this time. at to turn questions have And further I'd like

doing us well. joining tonight. Thanks, all for April. I Thanks, you everybody hope are

and If please have know. you other any Have a reach great let night. us out questions,

you Thank conference your for call. participation. This concludes today's

disconnect. may now You