Lub Liquidating Trust (LUB) 26 Nov 192019 Q4 Earnings call transcript

Greetings and welcome to the Luby’s Fiscal 2019 Fourth Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Steve Goodweather, VP of Finance and Investor Relations. Thank you Mr. begin. may you Goodweather,

on again November conference to also call. be only audio and And on Information fourth call XXXX. this being XXXX quarter can speaks link the through earnings This of accessed website welcome you. lubysinc.com. Luby’s recorded today, everyone as fiscal webcast Luby’s XX, Thank call is

initiatives, forward-looking of of include well future you Forms as changes and in this seasonality statements the food Company’s disclosed and of we I financial other operating but risks business, to, XX-Q. credit as Before and the not continue, statements and competition, would the governmental costs the on in general that availability reports like of and uncertainties Company’s taxes, statements. results periodic including uncertainties, business are regarding supply and XX-K operating as risks impact to labor Luby’s Those as success in remind limited Forms discussion, of well inflation, and commodity regulations conditions,

I that, Luby’s turn Chris? the Pappas. Chris to would now to CEO, and President call over like With

Thanks call. thank about with I will CFO, our COO, then joining by from you Gray. update followed Steve. and remarks an I progress our turn our on Scott turnaround begin call the on today’s fourth morning over to Good comments everyone us and quarter. the conference will for Todd Coutee

our of XX.X% a cost by the to size X.X in year, quarter our and or did guest to up large decreased XX Same-store our overhead to to In the of while the stores, results. XX.X% sales in million expenses compared fourth quarter, pleased traffic match XX.X lot reduce do us we part due and same-store now. we were decreased corporate we operating G&A fourth still our fourth million organization our or total to other X.X% last quarter about not have fewer sales to and sales work the with

last late quarter, is efforts. initiatives turning expenses are around financial you in Company number restaurant with we progress discussed include to turnaround and fiscal improve and our sales, Operationally, our diligently in XXXX our the working I XXXX, As began of Already a these improve we on whole our overall some making in plans number sales that a our improved guest of we performance. are seeing trends. traffic team and reduce

Additionally, payroll, accounting, some restaurant changes, of quarter we're XXXX operational the multiunit and realize calendar and forward these of functions over transition additional first transitioning hope our hope be savings forward. back transition We time of this to on from a firm. other we reporting the office to completing going leading portions outsourcing going in cost to

alternatives maximizing they the strategic are and of work. objective and Directors of Company process of The In with to available support the our a review of the Board that management their committee independent September, has shareholder announced purpose formed a of new Company's identify, Directors and the that we comprised directors committee would that our the of special strategic a continue range entire value. establishing examine special Board with Board consider of

initiatives transitioned were an has in locations franchise operators to Fuddruckers one company-owned Fuddruckers our franchises, update that to restaurants transitioned franchisee September, our operator. also seven April two to Turning now of to restaurants signed a to on Austin the Fuddruckers transition And of in the XXXX, new of restaurants to since a development total same future. the open has additional agreement in Company certain

our markets in on outside will of continue We opportunities additional transition of market Houston. work home to

to team of senior improve aid appointment new Todd leaders These reduce the a critical our fiscal making Operating to in President enhancements Technology. very are fiscal improve industry Marketing leadership We're new Vice active of our Coutee our and Luby's Information We liquidity entered with Chief results. management extremely In Vice into to and sales of as have to hired highly President in Officer. XXXX new and costs a our veterans. our financial five-year also XXXX, significant talented qualified credit our agreement efforts as and we

Board our XXXX level, public directors Board. replaced independent At experience and adding three with three new during we significant directors retiring industry our Board restaurant fiscal to

chairman in fiscal role Bodzy In addition regard XXXX, assumed generating began in program we Gerald million our to In sold the that proceeds. independent of in divestitures asset property August. XX.X

last were In cafeterias, XX years, we underperforming Paradise restaurants, Cheeseburger restaurants. fiscal XX Luby's in two the Fuddruckers X closed were addition, XX were over and

created do, We're working to process, our and hopefully drive a obviously day considerable core value. improve from our bottom to increase the profitability and While shareholder cash to to the clear, guests to serve And goal a our our brands both work our sales while cost flow and are structure, operating well. company as turning we same-store around trending line our still and increase hard we enhance see leverage guest that this way. have traffic is lower remains right every

same-store restaurant turnaround consistently and Finally, financial At value traffic our improving focused drive maintain remain sales to of the has are performance entering Company, confident, operational level, to members progress fiscal and experiences. the continue margin managers XXXX, store our by guest working our to level make our our and on guest the and ability we to great significant team are team we build plans. delivering profit and on restaurant and

to our I value. dedication brands their Our applaud team and brand and greatest work is hard showcasing our asset

I'd turn for call Todd? to Coutee Todd now like over the to few comments.

today. join to Thank you, Chris. I’m call pleased the

XXXX our we transformation and fiscal last initiatives and year. launched increase late same we these traffic working support positive Already on guest our positive mentioned, in progress the as XX, is as and have traction diligently Chris sales trends period positive sales, eventually fiscal a traffic improve versus fiscal year efforts. Strategic realized in work turnaround to to more are culture, entire making we're profitability. As gaining team

on Here are initiatives. some updates those

and people team initiatives. our our to drive all in on developing February, well We members to at training made order putting as in past the team right focus in right our people This as the the our invest commitment levels. enhancing places

our goal to By organization new the needed Our our provide brands each coaching providing success, marketing at guests our better experience. positioned sales, members to tools with and represented and we're realigning through succeed with and the for is people a team initiatives brand. our remarkable service with to have

everyday and guests. We The discounting for are grow coupon is goal our offers. also through an proposition with traffic discontinued to value email

marketing In created are that culinary fan value addition, our positioned and daily a favorites option. teams as

analyzing guests recipes as has new, trends, were and iconic economic, some factor were all choices crave. have and technological team current focused social on emerging the items By menu off-premise sales but become been our and traffic that Some our in growth. dining

where so are, online curbside is guests at deliveries meet becoming now dinner must growth we service ordering, results. a bigger the part Convenience, that recent and and they third-party strategy more of Understanding our most our integrity the and in component of this become and to endeavors this has our product, testing product meal, important segment. strategy. packaging will maintain support [Indiscernible] executing in compete the pricing that

to continue an product Within tasting, work home great continue convenient strive or deliver at our value to to at our to hectic can impact style little home guest comfortable business, Luby's enjoy schedules. environment. that will We we with cafeteria meals an guest excellent their no provide in outstanding with to a

opportunity that week. the allows as dine consistent pricing multiple great value see an with to structure maintain times continue a we to guest results minded We us per

As marketing on are heavy who to focuses we our traffic, to grow the continue our users effort brand. loyal

brand resonates that that heritage to the cafeterias a our speaking in is a that within and are we're way a markets. known to Our strong and well-regarded. proud Texas various widely Texas born remains brand demographics Fuddruckers

While XXXX, place price combo improve similar a our restaurants short with of Burger $X in Nashville the our primary to specialty sandwich. and our Hot along results our same-store in burger value as Infuse $X such in sales our chef-inspired Angle we promoting XXXX, offerings, on we focus chicken at Triple $X, cafeteria fall are plan right options amazing and premium the those orientation expectations higher and to believe Fudds is

well the offerings as our bar No strive this through else segment. and healthcare, customize it tailored our stadium brand unique the our an continues competitive food to segment living also requirements that grocery our free culinary service be distinguish it to and senior but fresh with clients, a We cheese. differentiation outlets. ourselves appeals that with and in with are business as communities hypercompetitive in to and one venues sales dining services, and crowded of amenity 'you facilities and We does imaginative contract not way' provides valued corporate cravable Luby’s with meet to only way. that along produce the your advantage clients. melted This burger top us using preferences retail solutions

in so increase facilities fiscal with plans healthcare care long-term the locations new segment. acute current We've a added two and have this client year to far

goods our continues retail a is items within Texas culinary to segment, addition, include H-E-B In team new services be our focus testing our in with culinary as partner our packaged Supermarkets. business to

of Fish expectations. 'n' nice continues us to Chicken offerings Tetrazzini business Casserole locations. for extend Squared well and Fried & the area existing to as iconic Our above Broccoli a restaurant Luby's offerings Rice opportunity well Mac as and of is Cheese This sell our beyond line

in leaders, our positive to we're them focus organization. the people which that as excited on dedicated grateful alongside about our I'm work for outcomes know developing colleagues our work will throughout we I'm progress into result in seeing we company. and

see As in mentioned comps to XXXX. pleased we're positive so year-over-year earlier, and fiscal far sales traffic

teams our determined teaching and with our and store-level cash long-term in working focused the for gross the field. shoulder-to-shoulder are by a We flow

our the call that, turn over CFO, I'd to Scott? to With Scott like Gray.

last We've loss operations upon I'll Todd. That year which loss of quarter $X a a partially to in $X.X from the by you, was fourth compared Thank decline in of lower in million, $X.X and decline in million primarily approximately results. million. depreciation few the and store-level $X.X expense on of reduction continuing a sales quickly touch in the profit, quarter expenses elements fourth million to quarter. SG&A $X.X $X.X a million due asset gain million offset reported

in spending decrease headcount, related digital we the costs Note statement our other charges and also the a year XXXX. media G&A approximately XXXX gives offset our from costs. income that, We break SG&A million resulted well out related include in efforts. reduced to picture as to line separating The These fourth X.X our added quarter amounted the other proxy million increased cost on of partially restructuring charges have a marketing These to costs fiscal $X.X these clear year-over-year by advertising full charges. other contest and separate related believe to efforts. for out to ongoing as our

last expenses. XX% reduce efforts fiscal were million year the to as expenses a compared to approximately X.X down year For or result of SG&A

rate run continue G&A more fully to as are decline our changes expect outsourcing We to our realized.

to compared million same quarter to million, the fourth compared million X.X in last quarter X.X X.X quarter, capital X.X During They our same decreased million expenditures decreased to year. last year. the the in

For XXXX fiscal million the X to of full fiscal projection was fiscal down our year X.X year, CapEx in we came in XXXX. million, CapEx XXXX. compared under

remain to continue levels. expect rationalize we we As portfolio CapEx at historically low of the locations, to

fourth with and for we had we August is balance balance sheet sheet, to XX.X appraised debt million. of the debt on an our net XX, to property ended cash held Turning with that a the quarter less million of sale XXXX value on say XX.X

million ratio per unrestricted to agreement. was Our as borrowings coverage available credit in XX.X our cash defined XXXX X, liquidity was and asset and our X.XX

adjusted SLP and or was negative year, a XXXX full stores was positive million. for adjusted store the EBITDA million, closed X positive a X.X For then our profit with EBITDA level excluding fiscal

like And to back I with turn to the Pappas. CEO, our would Chris call that,

I will Scott. Thanks wrap up.

place have make progress continue right on a we believe member improve CEO to and and our management and of in As team leadership our to to plans the we a shareholder results.

you In everyone as Thank Thanksgiving participation would year. we to to Luby's, next your and and shareholder we holiday fiscal early like Thank quarter into again you conference a XXXX. wonderful we investment wish call to forward first speaking in and a your again happy on look head you. for closing, season our

your gentlemen, thank conclude you teleconference. today's and This for does Ladies participation.

a have day. and may wonderful You lines disconnect your