Q2 2023 Cava Group Inc Earnings Call
Yes.
[music].
Good afternoon, ladies and gentlemen, and welcome to the Cabo second quarter 2033 earnings Conference call. At this time all lines are in a listen only mode.
During the presentation, we will conduct a question and answer session.
Any time during this call you required immediate assistance. Please press star zero for operator.
This call is being recorded at Tuesday, the 15th of August 2023, I would now like to turn the conference over to Matt <unk>. Please go ahead.
Good afternoon, and welcome to <unk> second quarter 2023 financial results Conference call.
Before we begin if you do not already have a copy of the earnings release and related 8-K filed with the SEC are available on our website at Investor Doc Cava Dot com.
The purpose of this conference call is to give investors further details regarding the company's financial results.
As well as a general update on the company's progress.
To the extent any non-GAAP financial measure is discussed in today's call.
You'll find a reconciliation of that measure to the most directly comparable financial measure calculated in accordance with GAAP in today's earnings release, which is posted on the company's website.
Before we begin let me remind everyone that this call may contain forward looking statements.
For this purpose.
Any statements made during this call.
That are not statements of historical fact may be deemed to be forward looking statements invest.
Investors should be aware that any forward looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from those discussed here today.
These risk factors are explained in detail in <unk> filings with the SEC and in today's earnings release.
Please refer to these filings for a more detailed discussion of forward looking statements and the risks and uncertainties of such statements.
All forward looking statements are made as of today and except as required by law <unk> undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information future developments or otherwise.
And now I'll turn the call over to the Companys co founder and CEO Brett Schulman.
Thanks, Matt let me start by welcoming everyone to carve his first quarterly call as a publicly held company.
We're pleased with how the market has received harbour.
As you'll hear our focus is on the long term.
Thats running a great business and building a durable brand that consistently delivers results.
Becoming a public company, while a milestone event was not the destination at the beginning of the next chapter of our journey Cava is creating and defining the next cultural cuisine category and our results in the second quarter of 2023 demonstrates the broad appeal of our innovative authentic Mediterranean concept and the.
White space opportunity in front of us.
<unk> successfully opening restaurants in new and established markets. We continued to deliver powerful unit economics, and we've already made significant investments in building an efficient scalable organization, putting the company in a strong position to deliver on our extraordinary potential for growth.
We are proving that bringing heart health and humanity to food as a powerful formula for success.
In the second quarter of 2023, we deliver hover revenue growth of 62%.
18, 2% Carver same restaurant sales growth, including 10, 3% traffic growth.
<unk> net new restaurants, ending the quarter with 279 restaurants, a 43, 1% increase year over year adjusted.
Adjusted EBITDA of $21 6 million, a $15 $7 million increase over the second quarter of 2022, and net income of $6 5 million.
Our Q2 results and ability to capitalize on the opportunities ahead are grounded in our three strategic pillars.
We are solidifying our category defining Mediterranean brand.
Our broad appeal and proven portability supports strong restaurant openings in new and existing markets. We opened 16 net new <unk> restaurants during the second quarter, including two new States, Missouri, and Rhode Island, along with continued expansion in Massachusetts, Texas, Georgia and Colorado.
We now expect 65% to 70 net new Taco restaurant openings. This year and have built our 2024 and 2025 pipeline to support annual unit count growth of at least 15%.
In 2024, we will open the first <unk> restaurant in the Chicago market, extending our unique brand of hospitality in the Midwest.
In addition to our new restaurant growth were enhancing the brand experience across our digital properties.
Our focus is on meeting our guests, where they are creating personalized hospitality and making sure they feel the Mediterranean way, regardless of how they engage with us.
This spring, we re skinned our carver app, creating an updated brand look and feel and more importantly, a better experience for our guests.
Our refreshed App has a warmer brighter front door and increased functionality to deliver new digital capabilities, including Reorders, and say favorites improved cart and payment functionality and faster performance.
Our new unified ecommerce site launched at the end of last year continues to deliver enhanced capabilities, including seamless dynamic content management driving increased conversion in per person average.
Starting in order on unified web were checking out on the App Youre orders state will be consistent across either channel with our new cart parity feature.
We've also completed our micro services initiatives fully migrating to our platform that supports rapid innovation and scalability. This flexible platform positions us for sustainable growth in our upfront investment and it will create leverage as we scale. We believe it's an in house digital platform few restaurants, our size much less.
Many larger brands have.
Our second strategic pillar is developing a modern best in class organization.
As we scale. This business, we are focused on delivering strong consistent results and running great shifts in every restaurant every day.
We're building a pipeline of qualified highly engaged leaders with the skills to run great operations and provide fantastic guest experiences.
These are leaders, who create high performing restaurant team.
Stay true to our mission culture and values.
Our 2023 target is to internally placed 75% of our GFS and we are currently on pace to achieve this metric.
To support this work we've developed our Academy GM Network Academy Gms are top performers certified to develop and train new Gms and lead training restaurants.
By the end of 2023, we expect to have at least one academy GM in each of our gardens or groups of eight restaurants.
The Academy GM network, not only serves as a farm system for new restaurant, Gms and future leaders, but also supports our work to minimize preopening costs by creating training hubs in growth markets.
We currently have 39 Academy GFS, including seven recently promoted to the Multiunit leader position, we plan to add 50 Academy Gms by the end of the year, allowing for localized training for new restaurants, and all existing markets.
We continue to build pathways and development opportunities for our team members evidenced by one of our New Academy Gm's Dixon Valdez Dixon.
Nixon started with us at 17 years old over six years ago. During that time. He has progressed from team member to guest experience manager the general manager and training and then onto <unk> <unk>.
Dixon with Zen certified as an academy Gn, demonstrating the power of our farm system and recently promoted some multiunit leader.
Proving that cover you can build a career not just have a job.
Our third strategic pillar is building the infrastructure to successfully scale and grow the business.
Knowing what this concept can deliver we continue to make strategic investments to support our long term growth.
These investments are having a positive impact on our operations our team and the guest experience and we expect them to continue to create leverage over time.
Our vertically integrated production capabilities are one example.
Construction of our state of the art food production facility in Verona, Virginia is well underway and we're on pace to commence operations in Q1 2024, we've erected all the steel framing and the exterior envelope is nearly complete.
Equipment is arriving and the management team is in place Verona. In addition to our current 30000 square foot production facility in Laurel, Maryland will be able to support at least 750 restaurants as well as our CPG business.
Integrated approach Centralizes, the production of our dips and spreads reduces operational complexity in our restaurants and supports consistent superior product quality.
Shifting to loyalty we are in the early phase of re launching our program creating.
Creating the infrastructure to further drive traffic mix and check as we scale.
Working toward a target launch in late 2024, the team is developing foundational customer segmentation capabilities that will enhance personalization of the guest experience.
Late this year, we will begin running test pilots to inform the new program a program that will be geared toward developing deeper connections with our guests driving more frequent relevant experiences that add value for both them and our business.
Since our earliest days our strength in culinary innovation is creating craveable food, where tasting healthy night we.
We have built a robust stage gate infrastructure for the ideation development testing and launch of new items too.
Two items have worked their way through the process and launched in Q2.
Our new spicy falafel main demonstrates how we use seasonal innovation to create new occasions and drive mix, while our new chopping fiery Broccoli is an example of core innovation that attract new guests and fuels continuous discovery well.
We launched spicy falafel in June and incidence rates are meeting our expectations and we're seeing strong customer adoption of fiery broccoli, which replaced our landfill to bully topping optimizing our toppings assortment.
The successful launches have expanded our plant based options and reinforced our Mediterranean culinary leadership.
Next I want to touch on the progress of our catering test menu.
Many businesses as well as collegiate and professional athletic teams have embraced our catered product and we believe catering can be a compelling growth opportunity.
We continue to test format variations to understand how to maximize production seizing the catering opportunity without detracting from existing channels.
Today, we have 10 digital kitchens that support centralized catering hub production and digital order pickup along with five hybrid kitchens that offer standard in restaurant dining and digital pickup.
With expanded kitchens to support centralized cater in production.
We are also piloting catering in a traditional restaurant format, where in restaurant and digital pickup volumes can accommodate catering production.
As we closely monitor the operational and financial performance and progress against our milestones we will share updates on the pilot in future quarters.
Finally, we're investing in our data infrastructure to drive operating consistency effectiveness and scalability.
Our proprietary internally developed operation Scorecard currently in test gives our restaurant leaders key operational and financial metrics in a single pane of glass, allowing for efficient real time actionable data.
In Q2, we also launched a new and improved real estate platform with richer analytics and Anonymised global data that informs psychographics segmentation and impact studies and.
Another benefit of the new platform.
<unk> reduces the time real estate manager spend putting together site analysis packages, allowing for greater productivity on the team.
Before I turn the call over to Tricia I'd like to wrap up with Q2 highlights and reiterate the opportunity in front of us.
This quarter's results continue to show the strength of our unit economic engine Carver same restaurant sales growth was 18, 2% driven by 10, 3% traffic growth our powerful unit economic model is evidenced by our $2 $6 million Adv and 26, 1%, However restaurant <unk>.
Evel profit margin during Q2, resulting in over $21 million of adjusted EBITDA and more than $6 billion of net income.
Finally, I want to express my gratitude for our team members, who are focused engaged deeply committed to our mission of bringing heart health and humanity to food as.
As we create and define a new category the white space opportunity in front of us the strength of our concept and our leadership position is clear our job is to make most of these advantages and we believe we have the right team to do it and with that I'll, let Tricia walk you through the financials.
Thanks, Brett and good afternoon, everyone.
Before I begin I want to remind you that our typical fiscal year calendar 13, four week period. The first quarter has 16 weeks and the remaining quarters have 12 week also please keep in mind that 2023 included a 50 <unk> week.
Create a 13 week fourth quarter.
As Brent mentioned <unk> revenue in the second quarter of 2023 increased 62, 4% year over year to $171 1 million same restaurant sales increased 18, 2% driven by traffic growth of 10, 3%.
While we anticipated a consumer slowdown this year the resilience of our guests and likely increased brand awareness from our IPO.
Strong traffic growth in Q2, we continue to see positive traffic trends into Q3. However, we are beginning to see a slight shift in deliveries picked up and moderating overall same restaurant sales growth as we are lapping an approximate 3% menu price increase in June of 2022.
That we did not plan to take in Q2 or Q3 of 2023.
We opened 16 net new combo restaurants, this quarter, bringing our total cover restaurant count to 279, we have strong unit level economics across every geography as well as in suburban urban and specialty markets and our overall <unk> now that the $2 $6 million.
All geographies are over $2 2 million.
However restaurant level profit in the second quarter was $44 6 million or 26, 1% of revenue versus $23 3 million and 22, 1% of revenue in the prior year, representing a 91, 9% increase.
The margin expansion was largely a result of sales leverage on labor and occupancy and improved food beverage and packaging costs.
Our second quarter profitability demonstrates the power of our business model.
Given our current stage of rapid growth, we do not expect to maintain this level of profit margin in the near term I will share more details later when providing guidance.
Harvested beverage and packaging costs were 29, 3% of revenue lower than the second quarter of 2022 by more than 230 basis points, driven by lower input costs and higher incidents of premium menu items driving favorable product mix.
Labor and related costs were 24, 8% down 200 basis points from the second quarter of 2022.
The decrease was driven by leverage from increased sales, partially offset by an increase in average hourly wages towards the end of the corner and an increased mix of new restaurants.
Consistent with our brands historical practice of investing in our team members and made incremental investments in wages at the end of the quarter and continue to monitor opportunities to strengthen our brand proposition.
Occupancy and related expenses were seven 8% of revenue an improvement of 70 basis points from the second quarter of 2022 due.
Due to increased sales leverage and a higher mix of lower occupancy restaurants.
However, other operating expenses were 12% of revenue an increase of 100 basis points from the second quarter of 2022, largely due to an insurance accrual adjustment in the prior year.
Shifting to overall performance, our general and administrative expense for the quarter, excluding stock based compensation and certain nonrecurring public company costs was $20 4 million compared to $15 3 million in Q2 of 2022.
This $5 1 million increase in G&A is primarily driven by higher performance based accruals and an increase in costs to support growth.
As we look to Q3, and Q4 of 2023 general and administrative costs each quarter, excluding stock based compensation and certain nonrecurring public company cost will be similar to Q2 of 2023.
Adjusted EBITDA, including the burden of Preopening costs for the quarter was $21 6 million more than the adjusted EBITDA for all of 2022.
The increase in adjusted EBITDA was driven by 18, 2% Carver same restaurant sales growth.
Improved cover restaurant level profit margin.
And the performance of new openings.
We reported $6 5 million of net income compared with a net loss of $8 2 million in Q2 of 2022, representing an increase of $14 7 million.
We reported diluted EPS of <unk> 21 in the quarter compared with a diluted loss per share of $6 23 in Q2 of 2022.
I would like to spend a minute discussing etfs and how it will change in future quarters.
The additional shares from the IPO and conversion of preferred shares into common stock occurred on June 20 of this year, which was weighted for only 20 out of 84 days in Q2, and 20 out of 196 days for the year to date period.
Had these shares been weighted over the full period diluted EPS in Q2 would have been six versus 21.
And for <unk>.
Versus 29 for.
For the year to date period.
As a result in future quarters, we expect EPS to be lower due to the impact of a higher diluted share count of approximately $117 million.
Shifting to liquidity at the end of the quarter, we had zero debt outstanding.
$352 8 million in cash on hand, and access to a 75 million undrawn revolver with an option to increase our liquidity if needed. Additionally.
Additionally, we have access to a delayed draw term loan facility with $24 million available to support the construction of our new Verona, Virginia production facility.
We delivered cash flow from operations of $47 1 million for the current year to date period compared with cash used from operations of $1 4 million in the prior year period.
This increase was primarily driven by our improved operations driving increased profitability across the fleet.
Q2 results demonstrate the power of our model and the value we are capable of delivering over the long term, having said that and as reflected in our guidance. The restaurant level margins delivered in Q2 should not be considered covers new normal given our plans for continued reinvestment at the rest.
Brandt level to support sustainable rapid growth.
Turning to our outlook for the full year of 2023, which includes a 50 <unk> week, we expect the following.
65 to 70, net new Carver restaurant openings.
Same restaurant sales growth between 13% and 15% kind of a restaurant level profit margins of at least 23%.
Pre opening cost between $13 5 million and $14 5 million.
And adjusted EBITDA, including the burden of pre opening cost between $62 million and $60 7 million.
Our guidance reflects both the near term strength, we are currently seeing and our cautious outlook given the uncertain macroeconomic environment in the back half of the year.
Now I will turn the call back over to the operator to open it up for Q&A.
Thank you, ladies and gentlemen, we will now conduct a question and answer session. If you have a question. Please press star followed by the number one on your Touchtone phone.
You will hear it rebound acknowledging your request.
As a reminder, please limit your questions to one.
If you have another question or a follow up please jump back to the queue and press star one again. Thank you.
Your first question comes from the line of John <unk> from Jpmorgan. Your line is now open.
Thank you very much I remember when we spoke about the first quarter and first quarter, obviously had exceptional comps by any measure and I think.
Truly above your own expectation you talked about not quite able to kind of get the costs into the system that you would've wanted to based on those elevated sales I wonder if a similar type of dynamic happened in the second quarter, especially with some of the IPO publicity do you feel that you were properly staff.
He is spending all the money that you wanted to in the stores were you happy with your execution in other words, you did the costs at least in the second quarter catch up with what with what once again was a very strong same store sales number thank you and congratulations.
Thanks, John .
Second quarter was certainly a very strong quarter with 18% in same restaurant sales and while we did make some investments in the quarter. We continued to see the opportunity to reinvest in the business reinvest in our people and build the pipeline of leaders for us to continue on this growth as we move forward into the future. Our focus is on the long term and when we can.
And we remain the category defining brand really execute on our proven portability and the powerful unit economics.
Really leveraged that massive white space opportunity.
Your next question comes from the line of Andy Barish from Jefferies. Your line is now open.
Okay.
Hey, guys nice results.
Just a follow up and then.
A question on.
On your stage gate process pricing it sounds like you're comfortable with just the first quarter menu pricing at this point for.
23 years that is that how we should interpret that.
So we don't have any plans to raise pricing for the remainder of the year were certainly very sensitive to our guests and any pressure that they might be experiencing so we did increase price at the beginning of 2023 and don't have any plans we remain a very strong value proposition for our guests our brand health surveys.
Reinforce that with us and what we find is that we're hard to recreate it homes, we provide a very unique and differentiated offering for our guests, but want to make sure that we're accessible for them no matter what the economic environment is so we're certainly.
Certainly reflecting that in our plans as we move forward for the rest of the year.
Okay. Thanks, and then just on the.
New product innovation and testing.
We've noticed.
State for the first time testing in a couple of restaurants can you just explain sort.
How you are.
Stage gate process works.
How important innovation is as.
As you move forward on both proteins as well as other areas.
Hey, Andy it's Brett.
To speak with you.
We are testing stake.
<unk> test, we start our process in a single restaurant test.
Vetted operationally as well as from a customer standpoint, and then move it into a market test and then a broader market tests. So we we pressure tested from both an operational and consumer perspective before rolling it out in a more broad based fashion you saw in the quarter two items that had worked their way through that process spicy falafel in fiery broccoli.
<unk> that we successfully brought to market. So excited to have steak is one of the items in the pipeline.
As it progresses through all the testing that you will see it in the market.
In the future.
Thank you very much.
Your next question comes from the line of David Tarantino from Baird. Your line is now open.
Hi, good afternoon, and congratulations on the results.
A question maybe about the guidance for the second half of the year Tricia.
I think it implies a pretty material step down in.
And the same store sales.
I know you are rolling over some pricing but.
I'm wondering if you're starting to see some some weakness in the underlying traffic or the guidance just reflects maybe comparisons or are some conservatism any perspective, you could offer would be helpful. Thanks.
Yeah, David Thanks, you certainly called out a lot of the things that we were speaking to and that lapping the increase in price of around 3%.
Also wanted to call out Q2, certainly we believe.
There was an amplification of our brand awareness in Q2 that we wouldn't necessarily expect as we go into the back half of the year and then even more so as really being mindful of potential headwinds with consumers around gas pricing or other options and so we wanted to reflect a very.
Cautious approach and how we're thinking about this uncertain macroeconomic environment that we may face as we go into Q3 and Q4 I don't know.
Yes, David it's Brad I think from a macro perspective, we're really mindful of a lot of pressures facing our guests outside of their cob experience, whether it's the gas prices Tricia touched on that have spiked recently.
The utility Bill cross pressures related to the extreme heat that hit a lot of the parts of the country you have student debt loan repayment hanging in the wings. This fall and you have a hawkish fed that as also signaled that they are looking to temper growth to ensure they tap out any potential inflation reigniting.
So we're mindful of those pressures, which is why we've leaned into our value proposition and as Tricia noted we have no plans to take price the rest of the year and have taken minimal price increases year over year to put forward, a really great value proposition for our guests regardless of what the macroeconomic conditions Greg.
Great. Thank you.
Your next question comes from the line of John <unk> from <unk>. Your line is now open.
Great. Thanks for taking my question.
I was curious.
Thank you had mentioned on the call the loyalty.
Test being pushed out to.
Later 24 for a launch so and I believe based on some of our earlier conversations that that's a little bit later than at least what I was anticipating maybe I just had the wrong expectation, but I'm curious to hear your insights as to perhaps why its a little bit later in 'twenty four and the difference that you are expecting between.
The existing program today, which I believe is more transactional. This one is going to move to a more surprise and delight, but.
Any thoughts or color you could provide around that would be welcomed.
Yes, John Thanks for the question.
We had talked earlier about the back half of 'twenty, four and really looking towards the end of the year, we will be testing and learning starting late this year into next year I think we've had the same program. Since 2013 as you noted, it's very transactional and we see an opportunity to really evolve it and build deeper more meaningful connections.
With our guests leverage all of those users within our current loyalty pool and create much greater value for them and for our business utilizing personalization utilizing the power of our concept and our customization and driving greater frequency mix and traffic so youll see.
Some tests beginning at the end of this year.
As I mentioned, we are building out the customer segmentation data work as a foundational piece to be able to really drive that unique personalization, where we're speaking to each of our guests based on their needs their preferences their profile.
One to one way.
Got it and then just circling back to the conversation on comp guidance.
I know you Tricia you had mentioned that you'd had a strong start to the third quarter curious if perhaps you can give us a little bit of cadence on the breakdown of comps on a monthly basis during the second quarter.
As you exited stronger than you entered that would be helpful.
John we don't intend to give intra quarter guidance on how the comps progressed on a quarter on a month by month basis.
Certainly did have positive traffic and continue to see that as we go into Q3.
Okay.
Your next question comes from the line of Brian <unk> from Morgan Stanley . Your line is now open.
Yes. Thank you good afternoon.
Maybe just within.
The strong same store sales in the second quarter and also the first quarter did you see kind of some of the similar impacts across your newer stores versus your more mature stores I E kind of the brand awareness Halo was that observable across the system and I guess the question is also just how much do you think some of the year two stores all.
The conversions.
Recently completed how much are those driving these same store sales numbers right now.
Hey, Brian Thanks for the question.
So as we look at our performance across vintages across geographies across format, whether it's suburban or urban we're seeing consistent strong trend in all of those environments. So can't really find any one area. That's driving the overall performance for us and so we're very pleased.
With what we're seeing and really demonstrate our proven portability. The powerful unit economics that we have and the opportunity to really expand on the white space as we move forward.
Your next question comes from the line of Brian <unk> from Piper Sandler Your line is now open.
Hey, Thank you just a question on development just hoping you could talk about the locations with the drive thru pickup capability, maybe just remind us how many you have today, how those are doing from an SUV.
On a margin perspective versus the rest of the base and then just related to that as you look out to 2024 and beyond do you anticipate those formats will become an increasingly bigger part of the pipeline over time just trying to.
You hear a bit more about where that format sits in your plants.
Yes, we have more than 20 pickup.
Pickup lanes digital pickup lanes in our pipeline today or excuse me in our fleet of restaurants today.
These are typically 10% to 15% higher than other locations in their market as a result of that certainly as we look at our pipeline of new restaurant openings in 2023, the rest of 'twenty, three and 'twenty four and beyond we do anticipate that our drive through digital pickup lanes will be a larger portion of the portfolio.
We just wanted to make sure that we're being thoughtful around investing in those and delivering the right returns as we move forward.
Thank you.
Your next question comes from the line of Chris <unk> from Stifel. Your line is now open.
Yes. Thanks.
Brian I know there were relatively limited number of organic openings in 'twenty, two but I was hoping you could just give us an update on how those stores are performing in comparison with kind of your new unit targets and then Tricia.
Company added 60 news this quarter was about half of them conversions going forward I guess, you could be opening a similar number of units, but no conversions, how should we think about the impact the profitability of opening.
New combo units versus conversions.
Hey, Chris Thanks for the question I'll speak to the first part and hand, it off to Tricia.
We're very pleased with the performance of the 2022 fleet they are outperforming our expectations.
And just to clarify in the quarter, we opened 10 de novo units and six conversions. So youre seeing already the transition away from conversions in Q3, we have two remaining conversions to open in the rest of the openings will be de novo units and as attrition to answer the balance of the question Chris.
As it relates to profitability, our new restaurants are exceeding our expectations as we deliver against our underwriting models that we have for those restaurants themselves and so we're not anticipating a significant negative impact on overall restaurant level profit margins as a result of the new openings, either this year or going forward.
Great Congrats guys.
Yes.
As a reminder, if you have a question. Please press star followed by the number one.
Your next question comes from the line of Sharon Zackfia from William Blair. Your line is now open.
Hi, good afternoon.
I have to Sam So obviously glad to hear about Chicago, but I'm also curious as you talk about Chicago I mean, it's probably the first new big Greenfield market for you in a while I mean, how do you think about attack in a market like Chicago in terms of how quickly you densify it or the cadence.
Densification, whether it's urban suburban how you how you plan to build the brand awareness.
Yeah, Hey, Sharon Thanks for the question.
Yes.
We've.
We've earned our stripes over this over the years, our second market away from Washington D. C. Our home market with DMV was Los Angeles and that is a large urban sprawl market and we really learned how to build out new markets have opened many subsequent major markets and so we're excited to get to Chicago, It's been a highly requested market and we also.
In our early years when we enter these markets we want to open three to five units within a 12 month period. So we've lined up and entry that we feel gets us to that kind of critical mass both from a supply chain and operational integrity and a consumer brand awareness standpoint, and given our.
Proven portability and broad appeal. It allows us to really go into a market and a multitude of ways, where we can pair some more urban sites with suburban sites high profile suburban trade areas and urban trade areas. So really gives us an area and ability to touch markets in unique ways.
And then I would also say that we.
We've been in whole foods markets and grocery in that market for almost nine years now and we do brand health surveys and awareness surveys and really pleased with the existing awareness in the Chicago market of the brand without even having a restaurant there and when we go into the market. We will do our traditional community days, which really helps generate.
Interest as well as give back to the communities, where we invite our neighbors, our new neighbors for a free lunch or dinner service and suggest donations not required but if any donations we match and they go to a philanthropic partner in the community typically addressing food security. So excited to bring <unk> closer to you next year great.
Great. Thank you.
Okay.
There are no further questions at this time I will now hand over to Brett. Please continue.
I want to thank our teams once again for a record second quarter Cava is a fast growing brand thats, creating the next cultural cuisine category.
Our performance in the second quarter reflects the diverse appeal and proven portability of our concept and as demonstrated by our strong unit level economics, and expanding clear leadership position, we are making the most of this massive white space opportunity in front of us while we are closely watching the potential macroeconomic headwinds on the horizon we are.
Remain confident in the durability of our brand and the long term value creation opportunity in front of US we are focused on sustainably scaling our business and fulfilling our mission to bring heart health and humanity to food.
Thanks, again for joining us and we look forward to speaking with you next quarter.
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.
Okay.
Next quarter.
Ladies and gentlemen.