Red Robin Gourmet Burgers, Inc. · NASDAQ:RRGB
Red Robin Gourmet Burgers — Q2 2019 Earnings Presentation
24 slides from Red Robin Gourmet Burgers's earnings presentation, Aug 23, 2019
Slide 1: Second Quarter 2019 Results
Second Quarter 2019 Results August 23, 2019 CLASSIFIED – INTERNAL USE ONLY
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-looking statements in this presentation regarding the Company’s future performance, comparable restaurant revenue, costs including selling, general and administrative, net income, EBITDA, earnings per share, tax benefit, capital expenditures, and statements under t
Slide 3: Red Robin Q2-2019 Results
Red Robin Q2-2019 Results • Total revenues decreased 2.3% • Off-premise sales increased 25.7%, now comprising 12.5% of total food and beverage sales, including catering • Comparable restaurant revenue decreased 1.5% (using constant currency rates) – strongest result in five quarters • Comparable res
Slide 4: Significant Progress on Business Improvements
Significant Progress on Business Improvements • Momentum in people, Guest and sales metrics • Sequential improvement in same-store sales – momentum continuing into early Q3 with comparable restaurant revenue of (0.1%) for the fiscal period eight ended August 11, 2019 • Top-quartile Red Robin restaur
Slide 5: Key Strategies to Deliver Value to Shareholders
Key Strategies to Deliver Value to Shareholders Our Five 2019 Strategic Priorities: • Stabilizing the dine-in business • Improving Guest experience and recapturing Red Robin’s known-for “Gift of Time” convenience • Continue building To-Go and Catering business • Implementing digital platforms and re
Slide 6: "All the Fulls" Omni-channel Brand Campaign
“All the Fulls” Omni-channel Brand Campaign • Launched in mid July with TV and radio media • Increased focus and spending on digital marketing and social activation • Encouraging fun connections with kids and parents • Already producing results, improved social media engagement – outperforming prior
Slide 7: Operations Focus: Strengthening Dine-In Business
Operations Focus: Strengthening Dine-In Business • Hire, Train and Retain • Manager Front Of House Engagement • Managing the Shoulders to Peak the Peaks • Delivering on the Promise of Maestro – fast and accurate delivery of high quality food at proper temperature PAGE 7
Slide 8: Financial Update
Financial Update PAGE 8
Slide 9: Comparable Restaurant Revenue Trend
Comparable Restaurant Revenue Trend(1) 5.0% 4.0% 3.0% 2.7% 2.0% 1.0% 0.5% 0.0% -0.1% -1.0% -0.9% -1.2% -2.0% -1.5% -3.0% -2.6% -3.4% -3.3% -4.0% -5.0% -4.5% Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 (1) Calculated at constant currency rates PAGE 9
Slide 10: Q2-19 Sales Highlights
Q2-19 Sales Highlights Q2-19 Q2-18 Q2-19 YTD Q2-18 YTD Change Change (12 Weeks) (12 Weeks) (28 Weeks) (28 Weeks) Restaurant revenue $302.4 million $310.4 million -2.6% $702.9 million $725.1 million -3.1% Total company revenues $308.0 million $315.4 million -2.3% $717.8 million $736.9 million -2.6% C
Slide 11: Continued Off-Premise Sales Growth
Continued Off-Premise Sales Growth US Comp Locations Off-Premise Sales as a % of Gross F&B Sales 14.0% 12.5% +290 bps 12.0% 11.6% Y-O-Y in 10.6% 10.1% Q2 2019 10.0% 9.4% 9.6% 8.3% 8.0% 7.6% 7.0% 6.3% 6.0% 4.0% 2.0% 0.0% Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 PAGE 11
Slide 12: Restaurant Level Operating Profit Margins
(1)(2) Restaurant Level Operating Profit Margins 25.0% 24.0% 23.0% 22.0% 21.3% 21.0% 20.8% 20.5% 20.0% 20.0% 19.4% 19.3% 19.0% 18.6% 18.3% 18.2% 18.0% 17.0% 16.8% 16.0% Q1 Q2 Q3 Q4 2017 2018 2019 (1) See Appendix for reconciliation of non-GAAP restaurant-level operating profit to net income (loss) (
Slide 13: Q2-19 Restaurant Results
Q2-19 Restaurant Results % of Restaurant Revenue % of Restaurant Revenue Favorable Q2-19 Q2-18 (Unfavorable) Cost of sales 23.9% 24.1% 20 Labor 35.2% 34.3% (90) Other operating 14.2% 13.7% (50) Occupancy 8.4% 8.5% 10 Restaurant Level Operating Profit(1) 18.2% 19.3% (110) (1) See Appendix for reconci
Slide 14: Adjusted EBITDA
Adjusted EBITDA(1) $50.0 $45.8 $45.0 $42.4 $40.0 $35.8 $35.0 $34.3 $32.3 $30.0 $28.8 $28.4 $25.5 $25.5 $25.0 $24.2 $20.0 $15.0 $10.0 Q1 Q2 Q3 Q4 2017 2018 2019 (1) See Appendix for reconciliation of non-GAAP Adjusted EBITDA to Net Income (Loss) PAGE 14
Slide 15: Adjusted Earnings Per Diluted Share
Adjusted Earnings Per Diluted Share(1) $1.20 $1.03 $1.00 $0.89 $0.80 $0.78 $0.69 $0.61 $0.60 $0.46 $0.43 $0.40 $0.19 $0.21 $0.20 $0.16 $0.00 Q1 Q2 Q3 Q4 2017 2018 2019 (1) See Appendix for reconciliation of non-GAAP Adjusted Earnings Per Diluted Share to Earnings (Loss) Per Diluted Share PAGE 15
Slide 16: Outlook for 2019
Outlook for 2019 • Comparable restaurant revenue down 1.0% to up 1.0% • Selling, general and administrative costs of $154 million to $157 million • Net (loss) income of $(2.2) million to $4.2 million • Adjusted EBITDA of $107 million to $117 million • Adjusted diluted earnings per share of $.95 to $
Slide 17: In Closing
RG Robin In Closing tench ea PAGE 17
Slide 18: Appendix
Appendix PAGE 18
Slide 19: Adjusted Net Income
Adjusted Net Income(1) ($ in Millions) $16.0 $14.0 $13.5 $12.0 $11.6 $10.2 $10.0 $9.1 $7.9 $8.0 $6.0 $6.0 $5.4 $4.0 $2.4 $2.7 $2.1 $2.0 $0.0 Q1 Q2 Q3 Q4 2017 2018 2019 (1) See Appendix for reconciliation of non-GAAP Adjusted Net Income to Net Income (Loss) PAGE 19
Slide 20: Cash Flow from Operations
Cash Flow from Operations ($ in Millions) $80.0 $70.0 $70.0 $60.0 $57.0 $50.0 $40.0 $37.5 $34.7 $35.0 $30.0 $25.3 $20.0 $20.0 $16.4 $16.9 $11.8 $10.0 $0.0 Q1 Q2 Q3 Q4 2017 2018 2019 PAGE 20
Slide 21: Q2-19 Commodity Update
Q2-19 Commodity Update % of Total COGS in Market vs. Contract Q2-19 Steak fries 12.9% 100% contracted through 10/19 Hamburger 12.6% Market Poultry 9.5% 60% contracted though 1/21; 40% contracted through 1/20 Produce 8.5% 70% contracted through 10/21 Meat 7.4% Market Bread 5.8% Frozen bread 100% cont
Slide 22: Reconciliation of Adjusted Net Income to Net Income (Loss) and Adjusted EPS
Reconciliation of Adjusted Net Income to Net Income (Loss) and Adjusted Earnings Per Diluted Share to Earnings (Loss) Per Diluted Share ($ in thousands, except per share data) 2017 2018 2019 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Net income (loss) as reported 11,567 6,931 2,714 8,807 4,380 (1,874) 1,709 (10,
Slide 23: Restaurant Level Operating Profit Reconciliation
Restaurant Level Operating Profit Reconciliation to Income from Operations and Net Income (Loss) ($ in thousands) 2017 2018 2019 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Restaurant revenue $ 413,451 $ 312,351 $ 301,100 $ 338,154 $ 414,702 $ 310,392 $290,218 $300,897 $400,484 $302,418 Restaurant operating costs
Slide 24: EBITDA and Adjusted EBITDA Reconciliation to Net Income (Loss)
EBITDA and Adjusted EBITDA Reconciliation to Net Income (Loss) ($ in thousands) 2017 2018 2019 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Net income (loss) as reported $ 11,567 $ 6,931 $ 2,714 $ 8,807 $ 4,380 $ (1,874) $ 1,709 $(10,634) $ 639 $ 981 Adjustments to net income (loss): Income tax expense (benefit) 2
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