Red Robin Gourmet Burgers, Inc. · NASDAQ:RRGB
Red Robin Gourmet Burgers — Q1 2014 Earnings Presentation
22 slides from Red Robin Gourmet Burgers's earnings presentation, May 20, 2014
Slide 1: First Quarter 2014 Results
First Quarter 2014 Results May 20, 2014
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-looking statements in this presentation regarding our restaurant revenue, new restaurant growth and remodels, future economic performance, restaurant-level operating profit, costs and capital expenditures, franchise acquisitions, statements under the heading “2014
Slide 3: Q1-14 Headlines
Comparable restaurant revenue up 5.4%, Guest traffic up 0.5% Total restaurant revenue increased 11.2% Restaurant-level operating profit margin increased 90 bps to 22.4% Diluted EPS of $0.82, an increase of 24.2% Acquired 4 franchised restaurants with an agreement to acquire 32 more by late summer Q1
Slide 4: Strong Q1 Sales Performance
Strong Q1 Sales Performance New Finest™ burgers Increased media Appetizer and beverage mix BTI and other engagement initiatives • Plating and presentation • Menu format • Service changes 3 3
Slide 5: Media Focused on Brand Attributes
Media Focused on Brand Attributes FPO 4 Finest™ Line Red’s Tavern Double®
Slide 6: BTI Exterior Signage
BTI Exterior Signage 5 5
Slide 7: Financial Update
Financial Update 6
Slide 8: Q1-14 Sales Highlights
Q1-14 Sales Highlights (1) Excludes Red Robin’s Burger Works® fast casual restaurants Q1-14 (16 Weeks) Q1-13 (16 Weeks) Change Restaurant revenue $335.0 million $301.3 million +11.2% Total company revenues $340.5 million $306.3 million +11.1% Company-owned comparable revenue growth 5.4% 2.2% +320 bp
Slide 9: Comparable Restaurant Revenue Growth
2.2% 4.3% 5.7% 3.7% 5.4% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% Q113 Q213 Q313 Q413 Q114 Comparable Restaurant Revenue Growth 8
Slide 10: Solid RLOP Margins
21.2% 21.1% 19.7% 20.6% 21.5% 23.3% 20.4% 21.7% 22.4% 16.0% 17.0% 18.0% 19.0% 20.0% 21.0% 22.0% 23.0% 24.0% 25.0% Q1 Q2 Q3 Q4 2012 2013 2014 Q1’14 +90 bps Solid RLOP (1) Margins 9 (1) See reconciliation of non-GAAP restaurant-level operating profit to income from operations and net income on Schedul
Slide 11: RLOP Margin Improvement
140 30 90 70 30 220 70 110 90 0 50 100 150 200 250 Q112 Q212 Q312 Q412 Q113 Q213 Q313 Q413 Q114 Q1‘14 +260 bps over Q1‘11 RLOP Margin Improvement Change over prior year, in bps 10
Slide 12: Q1-14 Restaurant Results
Q1-14 Restaurant Results % of Restaurant Revenue Q1-14 % of Restaurant Revenue Q1-13 Cost of sales 25.1% 24.9% (20) bps Labor 33.1% 33.8% 70 bps Other operating 12.1% 12.3% 20 bps Occupancy 7.3% 7.5% 20 bps Restaurant-level operating profit (Non-GAAP) 22.4% 21.5% 90 bps Favorable (Unfavorable) 11
Slide 13: Adjusted EBITDA
$33.6 $25.0 $20.0 $25.8 $32.5 $29.7 $21.0 $25.8 $37.0 $10.0 $15.0 $20.0 $25.0 $30.0 $35.0 $40.0 Q1 Q2 Q3 Q4 2012 2013 2014 See slide 20 for reconciliation of non-GAAP Adjusted EBITDA to Net Income (1) 13 weeks in 2012 $113.5 million trailing 4 quarters (1) Adjusted EBITDA $ in millions 12
Slide 14: Accretively Deploying Capital
Accretively Deploying Capital New Restaurants • Full-size (± 5,800 sq. ft.) •Mid-size (± 4,000 sq. ft.) •Red Robin’s Burger Works (± 2,000 sq. ft.) Brand Transformation Remodels •Average $350,000-$400,000 per unit •Complete system over next 3 years Acquisitions and Other •Announced two franchise acq
Slide 15: Net Income
Net Income $10.6 $7.7 $3.5 $8.4 $9.5 $11.1 $4.7 $9.1 $11.9 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 Q1 Q2 Q3 Q4 2012 2013 2014 $ in millions 14 (1) As adjusted, see slide 21 for reconciliation of non-GAAP Adjusted Net Income to Net Income (2) 13 weeks in 2012 (2) (1) (1)
Slide 16: Earnings Per Diluted Share
Earnings Per Diluted Share $0.71 $0.52 $0.24 $0.59 $0.66 $0.77 $0.32 $0.62 $0.82 $0.15 $0.25 $0.35 $0.45 $0.55 $0.65 $0.75 $0.85 $0.95 Q1 Q2 Q3 Q4 2012 2013 2014 15 (1) As adjusted, see slide 21 for reconciliation of non-GAAP Adjusted Earnings Per Diluted Share to Earnings Per Diluted share (2) 13 w
Slide 17: 2014 Outlook
2014 Outlook Comparable restaurant revenue growth in low single digits RLOP margins expected to be approximately 21.4% Open 20 new company-owned Red Robin® restaurants plus 5 Red Robin’s Burger Works® Capital investments expected to total between $85 million and $90 million, excluding acquisitions G
Slide 18: Appendix
Appendix 17
Slide 19: Cash Flow from Operations
$29.6 $20.5 $22.3 $22.0 $40.4 $30.6 $11.2 $31.3 $36.0 $0.0 $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 $35.0 $40.0 $45.0 Q1 Q2 Q3 Q4 2012 2013 2014 Cash Flow from Operations $ in millions 18 (1) 13 weeks in 2012 (1)
Slide 20: Q1-14 Commodity Update
Q1-14 Commodity Update % of Total COGS in Q1 2014 Market vs. Contract Ground beef 13.3% Market Steak Fries 10.9% 100% contracted through 10/14 Poultry 9.6% 100% contracted through 12/14 Meat 6.7% Bacon and riblets 100% contracted through 9/14, prime rib 100% contracted through 12/14 Produce 6.6% 80%
Slide 21: Adjusted EBITDA Reconciliation to Net Income
Adjusted EBITDA Reconciliation to Net Income 2014 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Net Income as reported 10,558$ 7,748$ 3,533$ 6,492$ 9,480$ 11,139$ 4,661$ 6,959$ 11,944$ Adjustments to net income: Income tax expense 3,356 2,408 1,210 1,552 2,977 3,576 1,517 940 4,424 Interest expense, net 1,833 1,223 1,
Slide 22: Reconciliation of Adjusted Net Income and Adjusted EPS
Reconciliation of Adjusted Net Income to Net Income and Adjusted Earnings Per Diluted Share to Earnings Per Diluted Share 2014 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Net Income as reported 10,558$ 7,748$ 3,533$ 6,492$ 9,480$ 11,139$ 4,661$ 6,959$ 11,944$ Adjustments to net income: Loss on debt refinancing - - -
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