Q4 2021 Texas Roadhouse Inc Earnings Call
Yes.
Good evening and welcome to the Texas Roadhouse fourth quarter earnings Conference call.
Today's call is being recorded.
Participants are now in a listen only mode. After the Speakers' remarks, there will be a question and answer session at that time, if you would like to ask a question. Please press Star then the number one on your telephone keypad should anyone need assistance at any time during the conference. Please press star zero and an opera.
It will come on the line to assist you.
I'd now like to introduce Tonya Robinson, the Chief Financial Officer of Texas Roadhouse, you May begin your conference.
Thank you, Brian and good evening, everyone by now you should have access to our earnings release for the fourth quarter ended December 28, 2021, and May also be found on our website at Texas Roadhouse Dot com in the investors section.
Before we begin our formal remarks I need to remind everyone that part of our discussion today will include forward looking statements. These statements are not guarantees of future performance and therefore undue reliance should not be placed upon them. We refer all of you to our earnings release and our recent filings with the SEC. These documents provide.
A more detailed discussion of the relevant factors that could cause actual results to differ materially from those forward looking statements, including factors related to the COVID-19 pandemic. In addition, we may refer to non-GAAP measures if applicable reconciliations of the non-GAAP measures to the GAAP information can be found in our.
Earnings release on the call with me today is Gerry Morgan Chief Executive Officer of Texas Roadhouse. Following our remarks, we will open the call for questions now I'd like to turn the call over to Jay.
Thanks, Tonya and good evening, we are pleased to finish 2021 with strong revenue and earnings growth versus both the prior year and 2019, our operators continued to do a great job building sales, providing a legendary experiences to our guests and holding on to margin dollars in the face of.
Hi, commodity costs, we ended the year with comp sales growth of 18, 3% compared to 2019 and that positive momentum has continued into the new year with comp sales up 26% for the first seven weeks of this year compared to.
2021 we're excited about 2022 and the opportunities ahead of us, including another year of top line growth driven by our new store openings franchise acquisitions and sales growth at our existing restaurants, we will continue to deal with many of the same issues that.
We faced last year, including commodity inflation staffing challenges and apply shortages. However in my experience as an operator each year in the restaurant industry comes with its own set of challenges and opportunities.
As usual, we will face we will focus on what we can control and make the best decisions for the long term benefit of our restaurants and our brands, we will stick to the fundamentals at Texas Roadhouse, We will continue to build operational excellence and name recognition at <unk>.
<unk> 33, and we will refine our growth plan for jaggers we.
We will continue to focus on our roadies by ensuring that we are hiring training and treating them right.
And we will continue to embrace technology and use it to enhance the guest experience, while still emphasizing the importance of face to face interaction between our restaurant staff and our guest.
We are finalizing plans for a mid April menu price increase of approximately 3%.
At this time, we have not seen a negative reaction from the price increases that we took in May and November of 2021, all indications are that our guests continue to view, Texas Roadhouse is a great value because of the prices that we charge and the quality of food and service that.
We provide however, we will never take our guests for granted and know that we must earn their business each and every day.
On the development front during the fourth quarter. Despite equipment supply challenges, we were able to open all 11 restaurants that were scheduled to open.
These openings included nine at Texas Roadhouse is one Bubbas 33, and one jaggers, we remain very pleased with how our new restaurants are performing to put that into perspective for the first seven weeks of 2022, the 10, Texas Roadhouse and <unk>.
<unk> 33 restaurants that opened in the fourth quarter averaged over 142000 in weekly sales.
For 2022, we are targeting 25 company owned restaurants, including as many as four Bubbas 33 openings. We also expect our franchise partners to open as many as five Texas Roadhouse is in 2022 the reduction in the number of expected open.
<unk> in 2022 is due to continued delays in the initial permitting and building approval process with this step taking longer than normal we are pushing several second half 2022 openings into 2023.
Going forward, we still believe that building, new restaurants, and taking care of our existing restaurants are the best uses of cash at the same time, our strength strong balance sheet and operating cash flow allows us to also create value for our shareholders and our.
Our employees through dividends share repurchases and franchise acquisitions.
Finally, I want to thank all of our Roadies, our restaurant managers and everyone at our support center for their tremendous efforts in 2021.
Also want to emphasize to each and every one of you that we will remain on offense in 2022 that means keeping our restaurants staffed with the best talent, serving smoking hot entrees and heaping sides and ice cold beverages as your partner and head coach <unk>.
Miss you that this is how we will continue our winning ways now Tonya will provide a financial update.
Thanks, Gary as I begin. Please note that most of the comparisons in my prepared remarks are versus 2019, and where did you provide a clearer understanding of our underlying performance. Please refer to our earnings release for a more detailed discussion of results versus 2020.
Results for 2019, unless otherwise noted our unadjusted and include the negative impact of lapping an extra week in December of that year.
For the fourth quarter of 2021, we reported diluted earnings per share of <unk> 76 cents up 24, 1% driven by strong revenue and restaurant level profit growth along with a lower income tax rate.
Revenue was up $170 3 million driven by comparable restaurant sales growth of 21, 2%, including eight 1% traffic growth and an average check growth of 13, 1%.
Check growth includes positive mix of five 3% as guests have moved to a higher priced entrees and increase their frequency of purchasing appetizers and other add on items.
Traffic growth continues to be driven by strong ticket sales while guest counts in the dining room were down slightly for the fourth quarter, our restaurants averaged approximately $17500 per week in to go sales, which represented 14, 4% of total sales average weekly sales were relatively can.
System throughout the quarter and nearly 122000 compared to 101000 in Q4 2019.
By month comparable sales grew 23, 6% 24, 7% and 16, 6% for October November and December periods, respectively. We estimate that sales growth for December and the fourth quarter were negatively impacted by seven 1% in two.
<unk>, 8%, respectively due to Christmas shifting from a Wednesday in 2019 to a Saturday in 2020 one.
As Jerry mentioned, our sales momentum continued into the first seven weeks of 2022 with comparable sales up 26% as compared to the same period in 2021. During these seven weeks average weekly sales were over 127000 with to go sales of just over 20000 per store or.
15, 9% of total sales.
For the fourth quarter of restaurant margin as a percentage of total sales was 15, 8% down 124 basis points as compared to the fourth quarter of 2019. We also focus on restaurant margin dollars per store week, which were up 11, 9% to over 19300 as compared to Q4 2000.
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And beverage costs as a percentage of total sales were 35% for the fourth quarter. This was 262 basis points higher than 2019, driven by 17, 6% commodity inflation compared to the fourth quarter of 2020, which is was in line with our forecast for high teen inflation.
Our beef outlook for the first half of 2022 has improved slightly but we still expect overall commodity costs to remain elevated with approximately 50% of our commodity basket locked for the first half of 'twenty 'twenty. Two we now expect approximately 17% inflation over that time period.
The back half of 2022 we have only a small portion of our basket locked which makes it challenging to provide meaningful inflation guidance, but that's time period. However, based on our internal projections, which we continuously review and update we expect inflation in the back half of the year, well moderate mostly due to the beef and other.
The prices that we will be lapping over all this would result in 12% to 14% inflation for full year 2022 but keep in mind that even if inflation moderates in the back half of the year the underlying dollar costs for beef and other high use items will likely still be higher both year over year and.
Sequentially.
Labor as a percentage of total sales improved 42 basis points to 32, 6% as compared to Q4 2019, even as labor dollars per store week increased 19, 2%.
This increase in labor dollars per store week was driven by wage and other labor inflation of 15, 4% and growth in hours of three 6%.
The remaining increase of 0.2% was primarily due to a point 8 million salary adjustment to our quarterly reserve for workers comp.
For 2022, we are forecasting wage and other labor inflation of approximately 7%, including the impact of enhanced benefits that we are offering to our hourly roadies. This.
This is an increase from our previous expectation for wage and other labor inflation driven by wage trends as our managers continue to invest in their people.
One thing to note here, we expect inflation will be above this level in the first quarter as wage rates did not begin to significantly increase until the second quarter of 2021 .
Other operating costs were 14, 7% of sales, which was 84 basis points lower compared to Q4 2019, approximately 10 basis points of the decrease relates to the benefit of a 0.8 million salary adjustment to our quarterly reserve for general liability insurance.
Of the remaining benefit comes from sales leverage.
Below restaurant margin G&A came in at four 8% of revenue of $4 5 million dollar increase versus 2019, our effective tax rate for the quarter was 13, 5% our tax rate continues to see a higher than normal benefit from FICA tip credits driven by the increase in our sales and a higher benefit related.
Our share based compensation expense for 2022 we expect an income tax rate of approximately 15% assuming no changes to the federal tax code are enacted.
With regards to cash flow, we ended the fourth quarter with $336 million of cash, which is down 101 million from the end of the third quarter cash flow from operations was $120 million and was more than offset by 62 million of capital expenditures $28 million of dividend payments $37 million of share repurchase.
She says and $90 million of debt repayment, we expect full year 2022 capital expenditures will be approximately 230 million with the $30 million year over year increase primarily driven by the planned relocation of six Texas Roadhouse restaurants in 2022.
I also mentioned on the first day of fiscal 'twenty 'twenty. Two we spent 27 million on the acquisition of seven domestic franchise restaurants. These restaurants are included in our expectation of six 5% store week growth.
Lastly, as announced today in our earnings release, our board of Directors has authorized a 15% increase in our quarterly dividend payment increasing it to <unk> 46 cents per share from 40 <unk> per share in 2021 like Kerry I want to thank everyone for their commitment to Texas Roadhouse and for their hard work, which has helped us achieve so much.
In 2021 and sets us up for a legendary 2022 operator, please open the line for questions.
At this time I would like to remind everyone in order to ask a question press star followed by the number one on your telephone keypad. Your first question comes from the line of Brian Bittner with Oppenheimer. Your line is open.
Thank you. Thanks for the question Tanya a question on your same store sales trends and just.
How to think about the underlying trends just given the choppiness of comparisons you. Obviously gave US a average weekly sales that are trending I think you said a little above 127000, but I'm, assuming maybe that includes a relatively depressed January so is there any way to think about AWS more.
Relative to that 127, just so we can understand how the underlying business is performing now that the army crown headwind seems to have subsided for the industry and I have a follow up.
Sure Brian Yeah. When you think about the first seven weeks and at 127 and there is a bit of volatility throughout I'm really you know you have a couple of really big sales days with new years and Ah Valentine's day is really big for us and it was really big for US This year and you know that.
That those high sales on those bigger sales day is kind of offset a bit of the weather and that you would you would think of as you think about that 127, because there was some weather negativity in those numbers. We were closed some days are definitely during the first seven weeks so in AE.
It's hard to really Peel it apart and give you specifics on what that means to that 127, but it isn't hot you know it it may be as you know slightly up slightly down a little bit, but not 127, I think is a pretty good number to think about them. You know as we continue to had it throughout the quarter and you're absolutely right. We are.
Gonna be lapping some pretty tough comparisons starting in March our March of 'twenty 'twenty. One was when we started seeing our average weekly sales climbed above 120, and so that's when the compares will get a little bit tougher.
Okay, and just a follow up on the on the Cogs inflation guidance. It implies that the second half is up 7% to 11%.
Spike rolling over the double digit inflation from the second half of 'twenty. One is there. Some recent dynamics are that you can talk to that that's impacting that second half of the year outlook and can you also help us understand what the pricing factor for the model will be once you do take this mid April price increase of I think he.
Said, 3%. So we can think about how that ultimately flows through against the inflation.
Yeah sure yeah, the commodity probably the bigger issue on the commodity inflation in the back half of the year. It's just that we don't have a lot of costs wiped up particularly on beef, we're a little more locked up on chicken them in the back half of the year not on pork I'm. So that it makes it really tough to kind of dissect ditch.
Time, and where those costs might land and so we're looking at historical trends a little bit you were looking at guidance on what's the cattle supply could be what slaughter rates are just all of those things are coming into play, but it is really tough to make that to make that call on what we think that number could be but we felt like it was really important.
Try to give some guidance and some transparency as to what it could be and and so that's where we landed in that spot. So we're going to continue to learn a lot more about the back half of the year and hopefully as we get closer we see you know maybe even a little more softness and that would bring those numbers down a little bit more but that that's our best estimate at that.
Time for that on the on the pricing side of things with that 3% at the beginning of April we'll have about 5.9% I believe close to six in Q1.
And then you the 175 that we had last year rolls off so you're at seven two for Q2 and that's the 3% and then the 4.2 that we took in November that stays consistent in Q3, and then if theres no additional pricing in Q4, I'm you'd be right around 4%.
With the roll off of the four two and then the 3%. So that's that's what we think the pricing cadence will look like for the year.
Thank you so much.
Yep.
Your next question is from the line of David Tarantino with Baird. Your line is open.
Hi, Good afternoon, I have a question on all the pieces and how they fit together.
To frame up the margin outlook, so I guess with the current level of pricing that you're planning.
And all of the cost inflation factors.
And I guess.
Restaurant margin could shake out.
For the year.
Yeah, that's a tough one I mean I don't think that you know, it's going to be tough to get into that 17 to 18 range. This year given that level of commodity inflation as it stands today. So you know we're going to continue to keep an eye on that but it is time, that's probably what makes it tough.
You know the most stuff I think we can get some leverage on other operating them and I think you know you can see labor B, you know, maybe a bit benign, but neutral on a full year basis, perhaps depending on how hours, we're assuming hours continue to grow a debt and things like that but with that 7% wage and other.
Inflation in there that's kind of where we land them and so a lot of it is going to depend David on traffic and where traffic lands. After March you know we know we're getting this big pop on comps here for the first eight weeks of the of the year and that's certainly going to set us up well to have a strong revenue growth and for the whole year.
But you know a lot will depend on where the margin lands is how much traffic, we get and and how that commodity inflation does shake out in the back half of the year.
Got it I guess, just a quick follow up if you.
Kind of extrapolate the run rate you're seeing in the business recently.
Is it possible that you'd be able to hold margin flat.
It's going to be.
Down given all the factors at play.
I think you know it you can probably you can build a scenario for it and maybe it would be flat again, I think it's going to depend on traffic and where that lands and and you know what we're able to do there. So but you know you could build a scenario I think it'll be on you know we feel good about sales for the full year, we feel like.
We're holding on to the to go sales levels and that's been really promise you know really promising to see that continue to hold up a lot is going to come down to how we're growing and growing traffic in the dining room.
I'm being able you we know the demand is there on sales and I'm getting the staffing back to where we don't see any impact to you know having a half section is closed and things like that would definitely be a big benefit to the year. So a lot depends kind of how that shapes up but we felt.
We're all very confident about revenue growth and and being able to get it down to the restaurant margin line.
Great and then last quick one on on this on the mix you've been seeing quite a bit of a mixed benefit lately when does that start to normalize.
Or do you think.
I think it starts coming down a bit off of these after these two first months of the year it'll start moderating and I think you know our our estimation is probably maybe it gets to flat by mid year and it's just back kind of back to normal where we would see it slightly positive, but you know for the most part neutral and.
The back half of the year.
Great. Thank you very much.
Youre welcome.
Your next question is from the line of Dennis Geiger with UBS. Your line is open.
Great. Thanks for the question.
Tom you are Jerry wanted to ask a little bit more about the longer term.
Restaurant margin algorithm that about 17 to 18 has anything changed there with respect to how youre thinking about that algorithm and kind of any thoughts with respect to how.
How quickly you can get there I guess, Tony you said kind of your base case, what what's not expect that this year, but just any kind of thoughts looking ahead to do that or if anything has changed there.
Yeah I think.
Our target is 17 to 18 I think that's a really good spot for us it's a very healthy target.
Looking at the last two quarters, we definitely have learned how to manage it with the higher labor and commodity inflation. So as we continue to hold the sales on the to go side or the dining room side, and we have less and less exclusions as well as new people added to it and it will be.
Very important for us to settle in and I believe again, not knowing how supplies or commodity or or some of the other.
Inflationary parts will play out the rest of the year, we have held the last two quarters, no one and going into it. So I think we've learned how to manage it.
Properly run it and we will continue to improve upon that so I feel really good about the direction were going and if prices can hold or even drop a little bit will be very good for us and the exclusions are a big part too is that part of our ability to get fully staffed is to have all of.
Our employees available, even though we're a little short the exclusion hurt us because we don't know when they get chopped for seven to 10 days, but a lot of that is real positive right now and we feel good going forward that as the Covid continues to settle if it if it does remember last year at this time, we thought that too.
And things changed but right now looks really really positive going into the rest of the year.
That's great I appreciate that Gerry just a quick follow up to that point as we think about this.
The staffing environment than in the operating environment, you know kind of how that impacted sales even margins kind of in the four Q. This.
This year, so far how much of an impact that's had on the business and then where you are right now how much more you need from a from a staffing perspective, if you can kind of quantify that what kind of benefit that may be going forward as you're able to do that thanks a lot.
Yeah sure Dennis I'll tell you I know, it's really hard to quantify the impact from that but you know we went back and looked at the data for Q4 and it seem like to US we maybe had as many as 10% to 15% of our shifts were impacted by state.
Hum areas being closed in the dining room, and and having those staff that staffing challenge and if you kind of extrapolate that across the quarter I think it's as much as 2% our same store sales that you know, we probably lost <unk>.
Due to those challenges across the quarter.
Yeah.
Thanks very much.
Yeah.
Your next question is from the line of Lauren Silberman with Credit Suisse. Your line is open.
Thank you. So just first on commodities, 50% of the food basket locked in for the first half can you remind us of how that compares to where you've been historically at this point in the year and then it just what's your overall sense of what's driving these all elevated levels given your expectation that you really don't expect to see these costs abate in the back half.
Yeah, you know as it compares pretty similarly actually to 2020 as far as the percentages. We had locked they were pretty similar you know coming into the year you know pre COVID-19 . We may have been a little more locked them you know maybe closer to 60%.
Or so but still feel good about that 50% in the in the front half of the year and it's pretty similar to last year, you know and as as we think about the commodity pressures in the back half of the year you know, it's it's a little bit.
Given the uncertainty that's out there not just with us but across the industry with the you know the suppliers the Packers and just what things are going to look like the demand how supply is going to play out it gets really tough to kind of lock those prices up.
In the back half of the year at a price that youre willing to accept and so we really felt like you know we want to wait and see and continue to watch and see how things play out them on both the beef side of things and even a little bit on the pork side of things just continue to see how that plays out for the rest of the year.
Okay. Thanks, and then just a follow up on the longer term restaurant margin. So a these north of 20% above 2019, a lot more inflation in the model underlying assumptions in snake commodity costs on a dollar basis, probably hold so what do you see as the path to get back to the 17% to 18% restaurant margin how much is in your control.
We'll versus the underlying macro environment.
Well I think some of it you know obviously the commodity inflation is a little bit out of our control we kind of have to just wait and see what happens there and typically those things tend to be cyclical and I think we'll see those prices turn around at some point, maybe they don't get back to levels, where they were but you know I think I think they are.
We'll come down from where they are at some point in time I think on the labor side, you know, we're going to continue investing on the wage at some point, though that kind of moderates a bit and you you're not continuing to grow those rate wages, you've kind of reached that point that you can stay out for a little while so I think that's you know something that could potentially.
He you know allow a little bit more on the margin side, and just continuing to drive traffic and be efficient on cost and our operators already they do a great job at that it's tougher in this environment and at these high volumes because sometimes they have to make choices that are a little tougher as far as when the.
The foods come in in the back door and how they're getting it on the table and things like that so you know there maybe some opportunity as things kind of you know even out and settle down as Jerry said that you see a little more efficiency, perhaps on those costs, which help but I don't think theres going to be any silver bullet Lauren or anything that's you know.
Because that's just not the way our models built them given how our operators are compensated them, they're watching that stuff. All the time I think it's just going to be a combination of continuing to drive sales and traffic and you know dealing with what well whatever we're dealing with on the inflation side of things and one thing I would mention to you I'm sorry, It's just technology.
G and I think we continue to utilize technology in a way that as Jerry mentioned in his prepared comments. It just improves the experience and let US focus on other things you know and lets us be more about giving the guest and even greater experience because some of the things are being done you know through technology. So I think that's something we'll continue.
To see perhaps helping us a bit too.
Thank you very much.
Youre welcome.
Your next question is from the line of Jeffrey Bernstein with Barclays. Your line is open.
Thanks, So much this is actually Jeff priester on for Jeff Bernstein.
Just first on the Bubbas brand I appreciate all the additional color on the press release, Youre, not providing but how should we be thinking about the long term potential for this brand both in terms of units as well as annual unit growth.
For the past four or five years, we've kind of been stocking about four to six year notes a year should we just kind of assume that or is there going to be a ramp up in the coming years.
Yeah, I I am feeling really really confident that we have.
Learn a lot in this coming year or this last year.
No.
We want and expect <unk> to deliver more than that so even though our target. The last few years has been maybe four to seven.
I do expect to ramp up to a 7% to 10 number and then go from there, but I think we are positioned we like where we're at on our building costs are we are very confident in our new leader of that concept in and that person reports directly to me. So as we have kind of split these concepts apart having a.
A director or a really a vice president run these concepts and really get focused on that.
Our business I feel like we're going to continue to make strides blockbuster than maybe where previously we had attacked it. So I absolutely expect our sales are fantastic, we feel confident about our food we know the model that we're looking at now financially so the future.
My opinion looks very bright for Bubbas 33.
We were really really have it's exciting we got to get through this year.
The ground and the foundation laid but we're ramping up for more expansion there.
Great and then Tony just on G&A can you help us some directional thoughts in terms of what we should expect there, especially considering that the quarter to quarter seasonality last year with the first half about $10 million lower than the second half.
Yeah, I think as we look at G&A you know, we still have very similar philosophy about that we'd like to see we want to see those dollars growing less than revenue growth, we I like to keep it as a percentage of sales I would like to keep it in you know in that 4.5% range, maybe even a lower and with these high sales volumes.
He was getting a little more leverage there. So I think the cadence of that cost across the quarters will be a little more consistent.
In 2022, I would tell you, though there is you know we'll have our N P conference coming up in Q2, and we didn't have that in Q2 of 'twenty. One so that will pop that number up a little bit more than what you would expect if youre basing it off of last year and then you know other than that I you know I think it is.
Hey, it's pretty similarly.
On the cadence of it and then the growth should be under revenue growth.
Great. Thanks, so much.
Uh huh.
Your next question is from the line of Chris <unk> with Stifel. Your line is open.
Thanks, Good afternoon guys.
I had a couple of operations related questions jewelry I could could you provide an update on what your what would you what learnings you've gotten out of the system test in Minnesota, and I know you'd also mentioned testing some new kitchen equipment I think fryers, maybe just curious if you had uncovered any interesting opportunities there as well.
Hey, Chris How're, you doing Budd.
You know I will tell you we are learning a lot at the <unk> system in Minnesota.
Some of the efficiencies again most of what we're learning is stuff that we didn't know prior to it and it's allowing us to really study more of our functionality and our our speed.
That to execute so from from the <unk> standpoint, we are still learning a lot. We have we are going to convert a existing store in July to that same deal and see how that goes. So again, we're going to we're going to continue to have a new store that opened in existing store converted and.
We will continue to learn from it.
Obviously, one of the other things that tablets continued to grow in popularity for US and then our what we're calling our roadhouse pay has really gained some strong momentum and really enhancing that.
That checking change experienced the ability for the guests to pay and the leave at their convenience and not really wait for US is really a big when you do see other concepts going in that direction too and it's definitely something we held off on but.
We probably shouldnt have it really isn't an enhancement to that guest experience, especially when it comes to the end on the what I call the checking change side of it.
That's great and then I know you put several marketing initiatives, maybe some product innovation opportunities on hold during the recovery period. This past year can you give us an update on how youre thinking about those opportunities this year.
Okay.
You know I think I'm not quite sure.
We're continuing to look at line setups, and how to be more efficient I guess, when you say that I would assume you're thinking of how do we assemble our prep.
How do we assemble our production food and then how do we predict.
Get it out of the window to the guest and were constantly revamping. We have display kitchen. We also have what we call a straight line, which really allows our efficiencies to be a little it's a little tighter, but we seem to be able to the motion test people or be able to get their job done with less movements. So I.
We're going to continue to look at that I think the big part of settling in learning how to do a 20% to go model as well as a full busy dining room is the one thing that we've really had to work on our traffic pass to really make it to where it flows a little bit better so that has been as we've.
Integrated and picked back up and held our to go but also filled our dining rooms back up probably been the biggest initiative. We've looked at is how do we flow better and the traffic for the to go and where it goes whether it goes out a side door or back of the kitchen. So those things we continue to look at.
At our four prototypes that we're currently use it it gives our operators a little bit of flexibility whether that to go food comes out through the front dining area or whether it goes out through the back of the kitchen, which we've seen some real strong efficiencies now we do have that and if youre talking about our drive up window.
We have several operators that are opting in for that and it is really working where people can place their order they consider in our parking lot and we can text them to almost.
Not a drive through but it is a drive up window and it really is the ability to text our guests and let them know when their food's ready whether they can pick it up inside one of our walk up windows or this drive up window. It is definitely exciting for our future.
I apologize Gerry I was thinking about highlighting early dinner opportunities are bringing people in during shoulder periods with maybe promotions or something like that.
Well, that's our early dine, yes, I think we're back on that deal very exciting always been a great big win for us and we call early dine basically from the time, we open until you know.
Early bright before the dinner rush is what we promote and we've got 15 items that are at a better price point.
Our menu item, just a little bit of a discount, but we will be promoting that a little stronger maybe than we did in 2021. So.
So we feel excited and a wild west Wednesday, we'll be kicking that back up at a stronger level. It's always been a big win for us on that Wednesday evening. So yes. Those are a couple of initiatives that we will be with soon as we need them, we will fire them up but and there are teed up and ready, but boy our sales are so strong right now.
I don't know how much we're going to push it yet.
Thank you guys.
Thank you thanks, Chris.
Your next question is from the line of John Glass with Morgan Stanley . Your line is open. Thanks very much first could you just confirm what your comment is is the dine in business back to 19 levels or I think you said about it just where where is it relative to 19 levels. Please.
It is slightly below 19 levels I'm, just a little bit in Q4. It it got it it was pretty flat in the first month of the quarter, but then we'd add Omar Khan search things like that you know, we obviously saw a bit of an uptick on the to go side dining room came back down a little bit and that continued in January .
So where we've seen it kind of get close and then kind of back off a little bit just due to some of those issues and I.
Expect that you know with staffing and things like that getting back to normal we're going to be able to continue to push that dining room traffic a little harder this year.
And in and just following up on on stuffing, what do you assume a labor hours grow in 'twenty two I know it's related to traffic, but I think you've talked about a 7% I think that was just the wage increase not including the the hours is that right.
Yeah, the 7% is just wage and other inflation and then from an hours perspective, we really don't give that number because it is as you said tied to kind of traffic expectation. So I'm you know I think we'll continue to see ours, you know maybe move up a little bit, but you know from our staff that.
Staffing perspective, you know we've seen it grow those hours grow at a pretty good clip so it'll grow a little bit more and it'll continue to grow in 2022, and a lot will depend on what traffic comes in it but I guess just asking another way you're fully excluding exclusions et cetera, you're fully staffed now relative to 19 is that fair or not.
I think that's fair I mean, we're getting we're definitely getting there.
<unk>.
<unk> two week, but I think he's got a lot of stores across the country that are fully staffed and not having any issues. There you've got some others that are still struggling with that a little bit and you know I think we looked at stores in Q4.
And to understand a little bit about is it demand or you know what what might what might be the reason for the dining room sales to remain kind of a little bit moderated and you see wait times in those restaurants, you see folks waiting for table. So it it definitely feels more of a staffing issue and that was in Q4.
Again, John when we were dealing with a bit of that surge from omicron and things like that and the exclusions were playing a bit more into it but you talked to some operators and many operators will tell you. They are feeling much better about the staffing and we just spoke with all of them as we were doing our pricing calls last week a lot of them say they are definitely feeling a bit of relief.
From a staffing perspective, and others are saying, yeah, we're still struggling with it a bit and and so they still have some work to do there.
Got it thank you.
Okay.
Your next question is from Bob Brian Mullan with Deutsche Bank. Your line is open.
Hey, Thank you I just question on the balance sheet net.
Net cash is still a bit elevated to history, even with the share repurchases you've done in the last two quarters.
There has to be a bit of a unique situation following the reduction to capex and dividends.
Place during Covid is there anything that would prohibit you were making more cautious around perhaps stepping up the pace.
The magnitude of repurchases, even if it was just a temporary in nature rather than a permanent thing.
No I don't think there's anything that would make me hesitant to do it I think you know we really want to you know think about franchise acquisition opportunities first we were having conversations with a couple of different franchise partners about that opportunity we were able to get one of those deals done right here at the beginning of the year.
So you know that along with growing restaurants, and just you know that Capex spend I think is really where our priority is and we're guiding to 25 restaurants. This year as Jerry said and it's you know we were hoping to get more than that and we still may have a chance where certainly I know our real estate team is going to be really working hard to.
So you get maybe a few more openings in and but know Brian I don't I wouldn't be opposed to doing more on the share repurchase side right. Now we're just focused on dilution.
And you know probably we'll be revisiting that in the back half of the year as far as anything else that we want to do there.
Okay. Thanks, and then just follow up just a question on Jaggers I think you know.
Late last year, you entered into your first area development agreement are you currently looking for more of those agreements maybe just how much attention are or how much from a resource perspective is being devoted to this internally you know just trying to get a sense of where it sits on the.
The priority list and how youre thinking about that longer term opportunity.
Yeah. So we were very excited we actually signed two franchise partners last year.
And we are in serious negotiations with our third.
In early stages of our fourth so there's no doubt that we see the excitement and enthusiasm around the brand we feel very confident with the structure that we have built out.
We're excited about the partners, we have not only on the company side, but I think it'll be a great team effort of us learning how to continue to grow on the franchise model, but yet build out our company side and.
So.
From that aspect there is some excitement and enthusiasm around it we do expect to continue to grow that brand and learn together with our franchise partners and go toe to toe with them for a little bit we will see who leaves who in the dust.
Yeah.
Thank you.
Okay.
Your next question is from Brett Levy with <unk> partners. Your line is open.
Great. Thanks.
I guess if we.
Try to delve a little deeper on the margin in the cohorts of your unit classes.
Maybe maybe this is another way of trying to ask it.
When you think about what you've seen over the last few years.
Are you seeing anything different on your restaurant level margins.
Questions 18 1920.
Anything across different regions.
And how are you thinking about your total addressable market at this point total potential number of units domestically and where we should think about those.
Sure Brad I, you know there really isn't anything by class year that I would call out because a lot of it from a margin perspective, just a lot depends on what state, they're in and what that wage rate looks like.
If you've got stores that are more in those you know.
Where they have state mandated increases or no tipped wage they're definitely going to have a higher labor cost.
Cost and a higher labor percentage of sales so they have some additional pricing.
You know to help them offset some of that but we're still always pretty careful on the pricing front even in those states. So I'm you know overall theres nothing I would really call out geographically other than that its a lot just depends on those labor states commodities are very consistent across the country I'm labor is it.
Probably it's the biggest difference when you think about the margin side sales doesn't really have any not a lot of difference at all geographically I mean, we have a lot of strength across the country.
For sure and so you continue to see really strong sales growth across the country across the regions the day parts.
And that's been really good to see.
And then for the growth I would just say that again, we had some very good success last year and maybe some smaller communities that we tested and tried in and they really impressed us. So that to me allows me to look a little broader in the real estate side and our team is not only looking at our.
Typical.
Yes.
Immunities and Metroplex is kind of thing, but there is also the smaller rural communities that we might have bought we couldnt go to just because of our footprint, but it has shown us. This last year that there is some enthusiasm and some smaller communities or more maybe a more rural area. So that is encourage.
<unk> for me to be able to continue to expand that.
That future growth pipeline.
Okay.
Your next question is from the line of Andrew strove Zwick with BMO. Your line is open.
Hey, good afternoon. Thank you just one clarification and then a question of clarification in terms of.
The delay in unit openings from 'twenty two does that should we think about that is pushing out.
The entire development pipeline into future years or is there eventually kind of a bumper year when things normalize.
And those delays go away and then my question is around locking in the beef prices.
I understand with the back half of the year and all the uncertainty.
The Packers are distributors are asking for.
Big premiums, but I guess I'm curious.
Is that also the case for the first half of the year, where maybe the visibility would be a little bit better I mean, obviously, we're seeing prices come in a big way should come in a bit does that create an opportunity in the nearer term or what would need to happen for that to converge from a lodging perspective in that premium.
And I'll take the first one.
I believe some of it is COVID-19 related for the processing of permits and some of that that's probably been the biggest delay aspect of just the length of time it takes to get through the loan process or the working with the real estate team and all of that so they've had some challenges I believe that we will.
Correct itself very quickly as more and more people get back it is working faster it just slowed us down in the fourth quarter through <unk>.
Some of that which delayed a couple of the openings or the permitting side of the business. So I believe that we will from what I'm told and involved in that we will be back on track very quickly and we're working aggressively to to hit that number in 'twenty. Three and then we will have that timeline built out with that expected.
Delay in there.
A much better shape from that.
Sure Andrew on the commodity side.
It's probably a little unfair on the amount that we're locked in the front half of the year because a lot of times, when we're saying what's locked where it's things that are fully fixed on price and we do quite a bit of buying you know on formula pricing and things like that where we we know a little bit more about the pricing that we may get them on some of the loads as we look.
A little more in the in the short term. So we don't include that in our kind of what we're saying is locked on pricing, but I think from our purchasing teams perspective. They feel very good about you know what they are doing right now in the short term and what they are able to negotiate and things like that if they found an opportunity where they felt like they could.
<unk> locked some of that up some of those loads up but you know our fixed price no doubt they would take it and get it done but they are really looking at so many different things that are involved which is a lot of pieces to the puzzle.
They feel like they can you know actually get better benefit by holding off a little bit. They will so that's kind of the way we look at it and again hopefully we continue to just lock up as we go throughout the year, it's just going to be a little more short term like you know 90 days versus being able to do it.
For six to nine months.
Great. Thank you very much.
Your next question is from John I haven't coal with J P. Morgan Your line is open hi.
Thank you I was hoping to get some education as what you thought was going on with the various cuts within stake sirloin Tenderloin ribeye.
Strip all seem to be have different trajectories at different times. So.
I guess kind of explain what you see in the market. If you think it's.
No it's normal or there is an uncommon amount of noise and do you actually have any flexibility on the menu in terms of what your feature at what size at what price that maybe gives a great value to the customer and also protect your own penny profit.
Yes sure John .
Yeah, I agree with you I think there is a bit more noise across the different cuts and what we typically would expect to see I'm I'm hearing a lot more about well ribeye went this way and top ups went this way.
I think some of it is just driven by retail and what's going on in grocery stores and some of those big box retailers and what they are doing with some of these cuts.
And maybe have some part of it.
And you know a lot of times you know it could be something from an export perspective, I haven't heard as much on that front. It definitely seems to be more retail driven right. Now is the only explanation I could give but I agree with you. It does seem a little more noisy than you would normally expect on the cut side.
Yeah, I would just say that I don't know that we would do.
Do anything different on the menu necessarily I think we have a great offering with four sizes on our sirloin. Our rib eye has become extremely popular I would say with our bone in ribeye, the bigger guy really the popularity on that is extreme so but we do.
At one time take our New York strip from a 16 eight ounce cut to an eight ounce cut and that eight ounce cut became is still to this day very very popular. So we continue to look at that so balancing how many big Stakes we have on the menu to how many really value offerings and our six ounce sirloin and our eight ounce.
So we're lining that eight ounce strip those are extremely popular steaks for us I don't I don't know that we would go smaller but it might be something to look at.
Okay. Thank you.
Allow me to pivot to the next question on in terms of acquiring franchisees.
Seven units for $2007 I mean at least optically I mean that doesn't look like a high number, especially for an established restaurants. It could you know is there anything you're kind of a different or unusual about that market that would allow you to be able to buy those stores at that price and remind me at least you know years ago. I remember there was somewhat of a call option feature that exist.
Did you know with your franchisees or is that something that you could or would want to do does the franchisee, perhaps want us all to where we could see an acceleration.
Franchise, the company ownership on the Texas Roadhouse side.
Yes, John you're right when you have a rollout formula that's included in the franchise agreement. It's a stock deal we haven't done one of those in quite some time. It goes it just really isn't great for either side from a tax perspective, and holding periods and different things like that the deals. We've done lately have just been you know much better deals at.
Cash deal and that's worked out really well for us in the 70 stores its a great market and it's a long time franchise partner that has been with us and just a great portfolio of restaurants. So we felt like $27 million without given multiples or anything like that 27 million was it really.
With a good solid number for the the EBITDA that we were buying and stores that have a lot of sales growth and it really works well for us I think when youre thinking about other you know it's been a tough couple of years, there's no doubt about it but sales have been strong and our franchise partners have been with us quite some time, so it's tough to.
This environment makes them more willing to sell because they are pretty tough in and they just like being part of the Texas Roadhouse family and they like the sales and the returns that theyre getting but we're still able to have conversations with them and and just talk about timeline and what that means and it might not be something in the short term it might be something that we're just setting up more front you know in the next.
Several years.
But the great franchise partners that I think will continue to see you know get some of those deals done and it really does benefit both of us.
Thank you.
Mhm.
Your next question is from Peter <unk> with <unk>. Your line is open.
Yes.
Great. Thanks for taking the question.
Tony I wanted to come back to the conversation around development.
Reduced the target for this year by fewer units or maybe as many as five yet the capex guidance remained the same. So can you just talk about are you seeing just more inflation in build out costs or are these units can be built and really not opened in time to meet the.
<unk> ER and the number for this year, just any thoughts around that.
Yes, sure, yes, youre absolutely right. So a lot of then the construction will still start at some point probably during 2022.
And our hope would be that we could get many of those restaurants are open early in 2023 I'm much just depends on they were stores that were already opening later in the year. So they may not have had you know quite everything in from a capex perspective. So there is a bit of that play just on still spending that money from a cabinet.
Ex perspective, even though the unit may not open them.
In 2022, then you have the relocations and there we talked about six of those this year for Texas Roadhouse. So that's a piece of that too and we're also talking about just existing restaurants.
As we talk about these higher levels of to go sales, you know and folks getting more comfortable coming back into the dining room. We're just talking about different projects that we may need to have to you know do you Corral conversions.
You know to get kind of.
Some of that crowd back in our in the waiting area and also still have the ability to do that to go out the window as Jerry mentioned, so we have some of those projects in place we're going to be doing some bump outs. This year getting that program kind of aren't back on track and somehow.
Some other things like that so that's a little bit too of what is driving that number up a little bit more.
Okay and then just lastly, you mentioned some of the operators are claiming they're seeing some relief on staffing.
What are the what are they attributing some of the improvement in staffing levels to when you're when you've recently spoken with them.
Well I.
I think theres more applicant flow first of all which is great. We have really done some good initiatives in the third and fourth quarter to continue to attract more and more people. Obviously, the exclusions are really reducing which is great that allows our full staffing where we're at but I think the biggest thing is that they are seeing more applicants.
So they're excited about more people wanting to come back to work more picking picking up more hours in.
From that aspect I think thats, where the positive role is coming from that the folks that were part time or probably work in a few more hours in and the ones that are really working a lot of ours are probably taken a little bit of a break because we're starting to build that bench, we're getting close like I said on the last call I feel really good where we're at I want to feel.
Really great unlike to be 110% staff that gives us a lot of options. It gives us ability to have fresh legs and strong people work in every ship or weakens are extremely busy we don't like doubles, we really like folks focusing on one shift doing it extremely well and knowing that they're going to have a little bit of a break because.
10 hours in one building serving the volume that we're doing and that.
That is definitely hard work there they are compensated really well they make a lot of money, but they definitely earn it.
Yeah.
Thank you very much.
Thanks Peter.
Your next question is from the line of David Palmer with Evercore ISI. Your line is open.
Thanks, Good evening guys.
I'm trying to think about your capacity at the restaurant level and in light of the fact that.
The industry is down so much in traffic, particularly on premise, but your dining room traffic is only slightly below 2019 levels and of course those levels, we're industry, leading in terms of traffic on our.
Productivity.
Dining room so.
I want to be greedy about your traffic upside from here, but you've done so well during COVID-19 and your it already such a high level of productivity I Wonder how youre thinking about the real capacity inside the restaurant, particularly if the kitchen is it has added you know hopefully some sticky to go business from here so.
Do you think the average, Texas roadhouse could handle 10% to 15% more visits, especially as to go mix hold.
Yeah, I do I think.
Miracle wants great food and and made from scratch in I think the flavor of our food the effort that we put into making it from scratch.
The hustle that our people have to serve and the desire to do it right I think we're fast we're fun, we're friendly and we will continue to do that.
Definitely our peak hours, we are jam and we're busy and we have long waits, but so there is still opportunity prior to that in our early segment and maybe even our last segment and maybe even some of our Saturday lunch.
So to me, yes, there is still room to grow.
Got to continue to help our guests navigate to an area or a timeline, where maybe they if they don't want to wait as long, but the ability I just read it.
E Mail from a guest that was able to go online and they were told they on Valentine's day that they would be able to eat dinner in two and a half hours from that time and they had a great experience. So that technology piece that we've talked about to tell someone that you can come in on a Valentine's day. This is a time you need to show up we.
Hit their quote we hit their weight, we delivered on our food and service and they took the initiative to write me a letter telling me how spectacular. It was so yes, I think we can still deliver on our sales growth.
Thanks for that.
Just wanted to check on your inflation forecast. So I think they were implying something like high single digit ish in the second half of year.
What roughly assume that key inputs are going to be.
Roughly near today's levels.
You know if youre running short on something that's the type of level youre going to be doing to get to that high single digits in the second half.
I don't know about that David and I will tell you. It seems like you know, even though inflation may moderate in the back half of the year. We think the dollars are still potentially going to be going up a bit so I'm in and that seems to be happening. So I don't know that I would say you know the the and I don't know if thats what youre implying.
That's maybe the dollar.
Costs are coming down and the people here.
Well no I mean, I really just have good prices one way to forecast would be just to say that on the stuff, particularly that's not locked in when I assume it remains at these high levels would probably not give yourself any relief.
You can also go with some sort of a futures curve type analysis, but.
Right now, it's such a weird time with like where there's a lot of supply chain constraints in that industry. So I wanted to understand if those come off.
That's gonna be above a benefit versus the way you're forecasting for your inputs.
So it would be a benefit if some of that is I mean, we forecast each line separately. We're looking at what we think the demand is going to be what we're going to need.
To source and and then we take that and based on the aging and all of those things that come into play kind of build it in to when that's going to hit the P&L. So that's the way we're looking at it and we're looking at transportation costs and delivery and all of those things are part of it. So yes, there's some relief on that will well it'll come through in the model.
And right now there's not a lot of.
Motivation to forecast that coming in better or being much lower them. You know just based on what we're seeing right now, but hopefully it that'd be great. If it did.
Understood. Thank you.
Sure.
Your next question is from the line of Jared Garber with Goldman Sachs. Your line is open.
Okay.
Thanks for taking my question I wanted to circle back to the off premise business.
The remains.
Strong and still generating as high average weekly sales levels.
Can you talk about what you're seeing maybe on a customer basis.
Customer using that channel differently are they the same customers as youre sort of diamond customers. If you have the ability to track that are you seeing higher.
This business may be during the week.
That's all I have gone out to dinner to the restaurants previously just any incremental color on maybe what you think is driving it.
Standing at high level of volume.
Thanks.
Yes sure.
As far as having any data around the gas, we're starting to collect more of that data and learn a little bit more from it it's still kind of too early to say, but it feels like you've got a couple of things going on you have guests that are utilizing us for both dine in and to go.
During throughout the week or the month or the quarter or maybe they're just increasing their frequency and then we've got new guests coming in that maybe to go was the first time they've ever tried us we certainly heard about that from the operators and folks you know last year. So I think you've got a lot of different things going on there from that perspective and.
I think you know overall that the online seems to I'm sorry, the on the to go seems to be sticky and I think a lot of it is because of the online opportunity that we have and we're seeing you know I think it's above 65% of the to go is through online transactions and that has just been really great.
To see so I think youre seeing a guest that likes the convenience of it and they like the ability to get online and get it done step on their way home to get it to your point you do see a little more of it in the earlier day part earlier part of the week, but you see it on the weekend too because a lot of times folks now we're so busy on the weekends they'll just due to go versus waiting.
To get into the dining room. So you do kind of see it all over but Monday Tuesday, Wednesday, do you see quite a bit I think as folks are heading home from work and things like that they're they're stopping to get it.
I think it's more about our ability to execute.
We improved so much over the last couple of years on the execution the convenience.
And whether it be the walk up windows or curbside or the things that we're doing just to allow our guests to have a better experience on the to go side.
I I believe from an operation standpoint, we've made it more convenient we the communication piece that we use the texting with the guests to let them know.
And then the obviously the delivery of the product and when they get home it's right.
A couple of factors I think technology has been driver execution really we've done a really good job of focusing on it.
And making it a better experience for the guest.
Okay. Thanks for that color.
Thank you.
Your next question comes from the line of Brian Vaccaro with Raymond James Your line is open.
Thanks, and good evening, and sorry, I had a phone glitch early in the call. So I just wanted to circle back on the Q&A that is but wanted to circle back on the quarter to date and you mentioned the 127000 I think for the seven weeks, but Tony could you help ballpark what that looked like in January versus more recent weeks and also.
Just sort of a normal seasonality you see in Q1, just trying to find my notes on that but I think March is typically maybe 10, if not 15% above January could you just help sort that out I'm just trying to set a reasonable expectation for the first quarter.
Yeah sure you're right March and April are typically a higher average weekly sales months for US and then May and June isn't too shabby as you get into mother's day father's day mother's day, particularly is you know is a big day in may for us, but you know over the course, just without getting into every week week wine.
What's a bit higher than that average just because you did have new year's day in their.
Things, then tapered off a bit in weeks 234, and as you were feeling some of that on the concert continuing to play out and we were probably a little more impacted on the staffing side with exclusions and things like that things began picking up in weeks 567.
And you know again Valentine's day is in there and that adds a tremendous amount to our average weekly sales I think on an overall basis for that for that seven weeks Youre talking about another 2000 on top of average weekly sales for Valentine's day. So on that one is a big one, but thats a little bit about the cadence hopefully that gives you a little more color.
We're kind of on how things played out and then obviously to Bryan we'd be remiss to not say you know weather obviously played.
Negative had a negative impact throughout those weeks SKU and causes to be down a little bit.
Just to see us down below that 127 average a couple of weeks with weather.
Alright Thats helpful. Thank you Tanya and then also wanted to ask on the other Opex line, if I could it seems like the inflationary pressure is starting to ease within that line. Thank you saw close to a 100 bps of leverage compared back to pre COVID-19 levels could you just comment on the underlying inflation in other moving pieces you see.
Being within that line and I guess with additional pricing is it reasonable to assume you'll continue to see some pretty solid leverage moving through 'twenty two.
Yeah, I think we could just given you know as you continue to see dining room, becoming a bigger.
Piece of pie on the sales on.
That kind of impacts us to go supplies and the impact they have as a percentage of sales in that other operating so you know in 'twenty that was picking up quite a bit as we had higher levels of to go more to go supplies.
And to go with a bigger piece of the puzzle so that could provide a little bit more leverage on that.
From an inflationary standpoint, we're not we don't have a whole lot built in above normal you know normally we were thinking in that 2% range from an inflation perspective, so that 3% pricing definitely does help now you have things in that line like utility and stuff like that that might go.
Play out a little differently, we'll see but right now that wouldn't be the expectation and then bonuses are a big part of that line also managing partner market partner bonuses and so as the profitability goes you know that line ebbs and flows depending so.
Could get see some leverage from that also and and I think you do have some opportunity to get a bit of leverage on.
On that line in 2022.
Alright, thanks, very much I'll pass it along.
Thanks, Brian .
Your next question comes from the line of James Rutherford with Stephens, Inc. Your line is open.
Hey, good afternoon, and thanks for taking the questions. Gerry I was curious on kind of the capacity related question have you seen any change to average table turns.
Today versus where you were a couple of years ago in the restaurant does it things you can do or things you're working on to improve those table turns without degrading.
The service level of your business or how can I guess perceive your restaurant.
Yeah, I would say from the tablets definitely help us a little bit faster, we've been able to see some some minutes there roadhouse pay or the pay at the table has definitely proven to be able to generate a few extra minutes on the table turn.
The <unk> is still a little early to see if that is helping us as a new store once they really get settled then we'll be able to kind of identify how they've improve that I think in general overall overall as every year of stores opened its efficiencies to be able to get the order in.
To get the food to the table.
It always is an improvement or we're trying to improve upon that but I haven't seen a real significant swing one way or the other we're pretty pretty much locked into that that somewhere between I will just say 55 minute experience, we like to have the guests there for an hour and really make it a memorable.
Deal.
Been able to hit that number pretty consistently overall.
Once they get through the weight and they get that experience is pretty consistent and that's what we want to target and focus on but there are a couple of things that we're excited about that could help shave a couple of minutes off of that and let the guests stay longer but if theyre in a real hurry, we want to be able to accommodate that in and out experience as you might call. It.
Okay. Thanks for that Jerry and then Tonya I was going to ask in the margin this quarter talked about a lot but were there any.
One time costs related to cold weather is exclusion exclusion or higher over time or anything like that that we should just be aware of that might fall off here. Shortly thank you very much.
Yes, sure so youre attacking James about cost maybe in Q1 of 'twenty one.
That will know.
No in the fourth quarter were there any kind of meaningful onetime things related to the surge in cases or over time or anything like that.
No nothing nothing significant that we would call out.
Okay perfect. Thanks, so much.
Yeah. Thank you.
There are no further questions at this time I will now turn the call back over to Tony Robinson.
Thanks, Brent and thanks, everybody for joining US Tonight. It was great to hear from you. If you have any other questions don't hesitate to reach out everybody have a great rest of the week. Thank you all very much appreciate it.
Ladies and gentlemen, and thank you for participating. This concludes today's conference call you may now disconnect.
Yeah.
Yeah.
Okay.