Carrols Restaurant Group, Inc.
Q1 2021 Earnings Call Transcript

Published: 13 May 2021

[Operator:]

Good morning. Welcome to the Carrols Restaurant Group First 2021 Earnings Conference Call. I would like to remind everyone that this conference call is being recorded today, Thursday, May 13, 2021 at 8

[Tony Hull:]

Thank you, Rob and good morning everyone. By now, you should have access to our earnings announcement released earlier this morning and an earnings review presentation that are both available on our website at www.carrols.com under the Investor Relations section.

[Dan Accordino:]

Thanks, Tony and good morning everyone. I will start off by providing a business update before Tony reviews our quarterly financials and outlook in greater detail. We had a very encouraging start to 2021 and delivered what we view as a strong quarter that we believe has set the stage for a great year at Carrols. Comparable restaurant sales rose 14.7% in the first quarter at our Burger King restaurants driven by a 49.5% increase in March same-store sales. Our strong performance in the month of March was preceded by a weak February, where we lost 682 store days between our Burger King and Popeye’s restaurants due to severe winter weather, particularly in the southern geographies we serve. We attribute our recent Burger King momentum to a successful dollar value product promotion that resonated with our customers as well as a partial return to a pre-pandemic behaviors and activities and recent government stimulus payments. Our year-over-year comparisons were also favorable, particularly beginning mid-March as we begin to lap our COVID impacted performance in 2020. We once again outpaced the overall Burger King system during the quarter as we have done for 19 out of the past 21 quarters. Using a calendar basis rather than the fiscal period basis we have reported, our first quarter 2021 comparable Burger King restaurant sales increased 12.3% compared to 6.6% for the U.S. Burger King system and I remind everyone that we are approximately 14% of the Burger King system.

[Tony Hull:]

Thanks, Dan. Total restaurant sales for the first quarter increased 10.9% to $390 million compared to the prior year period. This increase is less than the 14.7% Taco restaurant sales increase due to the accelerated closure of 34 underperforming Burger King restaurants during the last three quarters of 2020 and the way that days within the fiscal calendar shifted between the two years, particularly during the strong recovery period this past March. Average weekly sales at our Burger King restaurants were $28,094 in the first quarter of 2021. This is an improvement of 14% in 2020 levels and more importantly exceeded 2019 levels by 6%. Similar to what we have provided last year, we believe it is helpful to offer greater visibility into our Burger King performance by region as we operated over 1,000 restaurants as of the end of Q1 across 23 states. In the Northeast, representing 22% of our Burger King restaurants, comp sales were up 21%. In the Midwest, representing 27% of our Burger King restaurants, comp sales were up 18%. In the South Central representing 25% of our Burger King restaurants, mainly of Tennessee, comp sales increased 9%. And finally, in our Southeast region representing 26% of our Burger King restaurants, comp sales were up 10%.

[Operator:]

Thank you. Thank you. And our first question is from the line of Jake Bartlett with Truist Securities. Please proceed with your questions.

[Jake Bartlett:]

Great. Thanks for taking the question. My first is on the monthly trends and I believe in the release you mentioned that both March and April were up 10% versus ‘19. Could you confirm that or was it kind of as a whole or just maybe to confirm that? And also just in that context of this, if you could remind us what the monthly comps were in March and April last year? You are just noting there is a slight deceleration on the – in April versus March this year, but just to make sure I understand what the compares are there?

[Tony Hull:]

Sure. Yes, I can confirm that April and March were up 10% versus 2019 for each month. And secondly, last year, March was down for Burger King. March was down 16.8% and April was down 21.7%.

[Jake Bartlett:]

Great. And if you could touch on like – I am wondering about the difference between your performance in Burger King as a whole, do you have more stores offering the chicken sandwich, the new chicken sandwich in your system versus Burger King and could that be part of why you are outperforming by so much?

[Dan Accordino:]

Yes, Jake. This is Dan. No, we did not have more chicken. As a matter of fact, I think we may have had fewer, because we were one of the last areas to be rolled out in many of our distribution centers.

[Jake Bartlett:]

Okay. Dan, will you be able to share how many stores have it now?

[Dan Accordino:]

They all have it now, Jake. Yes, yes. Okay, yes, we didn’t. Some of these rolled out until April.

[Jake Bartlett:]

Okay, okay. Great. And then just moving to the cost and the inflation side, can you quantify it’s only what you expect for commodity inflation? And then how much visibility you have? I know, it’s a concern that investors have we have heard kind of pretty varying guidance from different companies, but what kind of inflation should we expect on the food side? And then how much risk is there to that?

[Tony Hull:]

Sure. Our overall commodity inflation for our full basket of commodities for 2021 is at 4% to 5% and that’s based on information we get from our national food supplier. So, they track if they are in constant communication with the manufacturers and that sort of thing. So, I think they are pretty good at seeing what’s going on, on the ground. Of our 4% to 5% increase, we think these will be about 2% and then chicken will be about 5%, then there is some other ones, smaller part of our basket, shortening is one that’s up pretty significantly, it’s going to be up – it’s forecasted to be up like 16%, but it’s only like 3% of our basket. And then bacon is forecasted to be about 14%. Again, that’s a pretty small percentage of our overall basket. So, what we are seeing really on the ground for beef is it obviously went up significantly from the low $2 per pound level to – in the last 4 weeks, it’s been very steady it grew to $2.30, but it’s sort of stayed at $2.30 for the last 4 weeks. And again, as we mentioned in the remarks that Dan made earlier, we think that there might be a bit of an increase this summer, but that will be back down to this $2.30. That’s what our food supplier is thinking. The other thing Jake, just to – completely a longwinded answer is that on the chicken side, our natural food supplier has hedged those costs at least for the underlying feed cost to chicken through the end of August and we have good supply sort of in place to get the chicken sandwich launched. So, we feel good about that. And so, we think we will get through some short-term volatility this summer to the end of the year, where things should calm down.

[Jake Bartlett:]

Great. That’s really helpful. And then my last one just kind of putting that together 4% to 5% commodity inflation, I think you mentioned 6% wage inflation that you saw in the first quarter and 2% of pricing. So, is there any – are there any offsets or should we expect restaurant level margins to contract in 2021? Are there any offsets like efficiencies, what we call in the store?

[Tony Hull:]

As we said on our prepared remarks, Jake, our promotional discounts are expected to be about 3% lower than they were in 2020.

[Dan Accordino:]

Yes, that’s very beneficial to the top line net sales growth, Jake, as well as it helps offset some of the cost of sales, other things that are going up in the cost of sales line. It’s a pretty material change from last year.

[Jake Bartlett:]

Got it. I appreciate it. Thanks a lot.

[Operator:]

Thank you. Our next question comes from James Rutherford of Stephens. Please proceed with your question.

[James Rutherford:]

Alright. Good morning, Dan and Tony. Hope you are both doing well. Congrats on this 10% to your comp here in March and April. I think that’s really impressive. Dan, you called out differences as far as kind of what drove that? You called out differences in regional performance, better opening of late night and better performance in the Dollar Menu and Bacon Cheeseburger. If I got all those correct as far as what drove the outperformance versus the system, I was curious if you could possibly quantify even just broadly the impact of those components on the outperformance? And then why do you think there is such a difference in the regional performance here in March and April? I think I have an idea of I am curious your take on that?

[Dan Accordino:]

I don’t have the – I can’t break out how much of the outperformance was in each of those categories. So James, I actually got that response from our Burger King Corporation and RBI. I asked them why we were – why this outperformance was the most dramatic we have ever seen. When you consider the worst 14% of the 6.6%, the outperformance was really over 600 basis points. So, why as far as opening restaurants I am pulled by again RBI, that we just did a better job in keeping our restaurants open later in the evening, and also making certain that we were open for breakfast, which apparently was not the case in some part of the system. The Northeast has historically been stronger for us and has continued to be so. And as we mentioned in the script, I think some of the underperformance in the Central and Southeast area was due to losing 682 store days in February, which was a pretty dramatic effect primarily on our Popeye’s business. As far as why we are selling more bacon cheeseburgers than our balance of the system, no one is able to give me an answer. The only thing I can assume is that, we have all of our PLP of advertising the fact that the bacon cheeseburger is being sold for $1. Perhaps others aren’t necessarily advertising it on the windows in the drive thru, which is primarily where all the business is going through.

[James Rutherford:]

Dan, did that regional outperformance for the Northeast and the Midwest extend into March and April once the weather was no longer a driver?

[Dan Accordino:]

Yes, for us it did. I don’t know about whether the outperformance relative to the balance of the system continued to be at that level. But yes, our outperformance in those markets continues. Yes.

[James Rutherford:]

Okay. And then flipping over to breakfast, where was your breakfast mix before the pandemic began? Where does it stand today? And I am just curious how that kind of compares, I think the total Burger King system was 13%. And just your take on how that day part is performing here in the last couple of months.

[Dan Accordino:]

We are at 14%. Now, which isn’t? It might be a point lower than it was pre-pandemic. But it’s pretty similar to what it was pre-pandemic, James.

[James Rutherford:]

And then last one, I will turn on to the queue is on labor. You always put a lot of thought into how you manage this line. And you mentioned that your hourly labor staff remains at 21 in the quarter here. I think before COVID you were at 23. Dan, can you share your running quarter to-date on labor per store? And if – what will post COVID normal world, normal labor market, are you going to be above that 23 now that you have a new person at the chicken station or the breading station?

[Dan Accordino:]

We will not be above 23 and I hope to get back to 21, James. April was not a good month in terms of our ability to staff the restaurant. That is our – the major challenge right now is once all these payments came out, which was the end of March, staffing in April is much more difficult than it was in Q1.

[James Rutherford:]

Are there any disruptions on your operating hours or requirements to close the stores temporarily because of that?

[Dan Accordino:]

Sporadically, we have had some restaurants that have closed prior to the normal closing hours. It’s been a handful, but it has happened sporadically. Simply because you staff, four or five, six people to show up. And that’s been the challenge is you may have enough people on your roster. The question is whether or not they are all going to show up to work.

[James Rutherford:]

Okay. Thanks for all this.

[Operator:]

Next question comes from the line of Brian Mullan with Deutsche Bank. Please proceed with your question.

[Brian Mullan:]

Hi. Thank you. Hey, congrats, guys on the results. It’s encouraging to hear about two year trends in March and April, above ‘19, presumably from here, the impact from stimulus should start to fade, but at the same time, you have the menu innovation coming. Hopefully, you have a tailwind from mobility. So, I am just curious that when you put it all together, do you think you can hold that level of strength or momentum versus ‘19 in the coming months and quarters? What’s a reasonable way to think about the shape of the rest of the year?

[Tony Hull:]

Yes. Brian, this is Tony. I don’t – we are not giving the forecast because things are certainly moving so fast. We wanted to give you insight into what’s happened in March and April, just on the two year stack basis, the first quarter was up 9%. So versus ‘19. So, beyond that we are not really prepared to give the finite number, but I would reinforce that there are some really good things coming on the products rollout from Burger King. The main one, obviously, being the chicken sandwich. And then there are some other more ancillary type products that are being rolled out over the next several months. So, we feel really good about the momentum we have. And we think it’s going to be a good year for the company.

[Brian Mullan:]

Okay, understood. Thanks, Tony. And then on the sandwich, from an operations perspective, can you just speak to I know, this involves some extra equipment, perhaps the new procedures, and the sales lift? It sounds, I think everyone is excited for that, can you just comment on how the operations are handling it. And are you pleased with everything so far?

[Dan Accordino:]

Yes. Brian, so far at the current level of sales volume for the chicken sandwiches, we have been handling it without any issues whatsoever. Other than the normal, ongoing issue, which is making sure we have enough people in the restaurant. The chicken process, specifically is not a big challenge for us now.

[Brian Mullan:]

Okay, and then the last one was just wondering if you could talk about expectations about the upcoming launches, the loyalty program, have you tested it in any locations? And if yes, are you seeing it impact consumer behavior? And then longer term, do you think that this can be a real transaction driver for the business over the long-term? Thanks.

[Dan Accordino:]

We probably don’t have enough data right now. It’s only available through the mobile app. And then that’s been sort of Phase 1. I mean, we have seen a lot of, given we are watching it carefully, we have seen a lot of redemptions. So, a lot is a relative term. I mean, compared to our 10s of 1000s of transactions a day, it’s not a lot, but we are watching it carefully. And I think when it rolls out into the restaurants that will be – it will be more used and I think that 1% mobile order is really low compared to others. So, I think there is a lot of upside there. Once this loyalty program rolls out, and we are excited. The other big thing about it, Brian that we talked about is the getting rid of paper coupons. We think having electronic coupons is going to be beneficial to promos and discounts going forward. So, that’s obviously going to help the bottom line on that, too. So, it’s being rolled out, it’s early days, but we are – it’s like the chicken sandwich just doesn’t have national advertising behind it yet. But I think it’s going be a big plus just the same way, maybe not to the same magnitude of delivery. But that is something that really, Burger King was behind and made it easier for us to get that to 5% of our revenues. So, we are hoping they repeat that success with the loyalty program.

[Brian Mullan:]

Okay. Thank you.

[Operator:]

Thank you. Our next question comes from the line of Fred Wightman with Wolfe Research. Please proceed with your question.

[Fred Wightman:]

Hey, guys, good morning. I just wanted to touch on the traffic and check commentary that was in the release. I mean, it sounds like traffic started to approach those pre-pandemic levels in April and you are holding on to a decent amount of the check that was benefiting from COVID. So, could you just talk about how you think traffic and check are going to perform as we reopen over the next few months, and then just how you think, Carrols Burger King and the broader QSR burger category can participate in that reopening?

[Tony Hull:]

Well, in the first quarter, we had the benefit of both going up. I think the check was up 11%. And traffic was up 3% in the first quarter. And then as we mentioned in the script that it’s kind of right now thing sort of stable check at this heightened level as you mentioned, and we were sort of at 90% of our pre-COVID traffic. So, we think there is a lot of upside there. It’s really, some of it’s from the day-part coming back, the night and the breakfasts that that’s definitely helping traffic, but traffic is up in all day-parts. And then as you said, we will maintain in check. So I think, the check, staying at these the post-pandemic levels has been somewhat of a reassurance to us that we are going to have strong – we will have a strong combination of stable check, and then building out the day-part in traffic as year progresses. So we are pretty encouraged by what we are seeing.

[Dan Accordino:]

Fred, this is Dan. To answer your question, from an overall standpoint, how we view it. I think the issue in terms of – first of all, the loyalty program, as well as the chicken sandwich should be incremental to increased traffic. So I mean, that’s the whole purpose of doing it. So, we are expecting that traffic will continue to increase. We would expect that the utilization of drive thru will still be a primary focus for guests. And even as other casual dining, outlets reopen, I think it will be a while they all can reopen at full capacity simply because they don’t have enough servers and whatnot, either easier for us to staff our restaurant at least for them. So I think we will see both, we will continue to see traffic increase. And as Tony said, there is no reason to believe that the check couldn’t be somewhat stable. Perfect, it makes sense.

[Fred Wightman:]

And on the chicken sandwich, I get that it’s fully rolled out now. But if you look back throughout the first quarter, is there anything you can share about the performance of restaurants that did versus didn’t have the product understanding, that marketing wasn’t really turned on, but anything there would be helpful?

[Dan Accordino:]

Not in terms of same store sales lift, because of the way the rollout was handled? I really don’t have any quantifiable data, because it was a sum. And within the same DMA, some restaurants have and, some restaurants didn’t. And it really, we didn’t have enough exposure over the entire quarter to put a number on it.

[Fred Wightman:]

Okay, that’s fair. Thanks a lot, guys.

[Operator:]

Our next question is from the line of Jeremy Hamblin with Craig-Hallum Capital. Please proceed with your question.

[Jeremy Hamblin:]

Thanks guys. And I will add my congratulations on the impressive performance. I do want to come back to the chicken sandwich for a second. And Dan, I would say that, you haven’t expressed quite the same enthusiasm that you might otherwise do around this new product. And I don’t know if that’s because it’s a little early on, it sounds like operationally, your team is handling it really well. But in terms of, no national ad support at this point, do you have a sense of, the number of units that you are selling on that how that compares to the prior crispy chicken sandwich. Any color that you might be able to add and whether or not that’s part one of the question. Part two is, whether or not you think national ads would be coming here in Q2, what you think that could do in terms of potentially boosting the overall sales of the product?

[Dan Accordino:]

I don’t know why I am showing the lack of enthusiasm. Compared to I am not sure who you are comparing me too. But you got to remember I had a charisma bypassed a long time ago. The sandwich is outperforming the old – the previous crispy sandwich by roughly 10 units a day I would guess pre-advertising. And in markets where it has been advertising on a test basis, the outperformance of the previous chicken sandwich is doubled. And that is the expectation as the advertising will be launched in late around the summer, that will double the amount of units, the number of units that we sold them with the previous chicken sandwich.

[Jeremy Hamblin:]

Okay, that’s helpful. And I wanted to just come back to the same-store sales for a second, I think what you called out was 49% comp change versus – and I think it was like a minus 16.8% last March, lapping minus almost 22% in April, presumably that would imply that you are probably up over 40% for the month of April? And then as we kind of look forward, obviously, the competitors get significantly tougher I think May was down 3 or so last year and in June, you were back to a positive comp. But in terms of near-term expectations, you just put up a pretty significant comp here in Q1, presumably you guys would expect probably a double-digit comp in Q2, is that a fair assumption?

[Tony Hull:]

I think that’s a good assumption, yes.

[Jeremy Hamblin:]

Okay. And in terms of are you able to callout what the April comp was or would you rather not?

[Tony Hull:]

Well, it was up 31.5%, Dan mentioned on his prepared remarks.

[Jeremy Hamblin:]

Okay, missed that. Okay. And then I actually wanted to switch gears and Dan, you mentioned acquisitions and that you were potentially or not potentially that you were working on some deals. In terms of magnitude of deals, what you are seeing out there in terms of potential sellers? Has the pipeline become more active at all? Obviously, it’s stressful 18 months, I think for a lot of franchisees. Do you sense are there more people working to sell, a)? And b) in terms of the price multiples that they are looking for and I know you guys kind of target around 4x EBITDA, what’s the sense that you are getting from those franchise who are looking to sell?

[Tony Hull:]

I can only speak to the ones – the few that we are aware of and the multiples are a tick higher than what they were pre-COVID, but still within the range of what is reasonable. In terms of the number of potential sellers, I mean, there are always people who are looking for an opportunity if someone is willing to engage in the dialogue, I think it’s about the same as what it was before, Jeremy.

[Jeremy Hamblin:]

Okay, great. And then last item here from me, your restaurant – your other restaurant operating expenses, in terms of thinking about that particular line item whether it’s credit card fees, which I think impact that line item, how do we think about that one on a year-over-year basis? Is that something that obviously you leveraged it really strongly in Q1 and you continue to have a lot of momentum here on the sales price in Q2, what type of dynamics do we need to be thinking about on that particular line item as you see things like loyalty program rolling out and other dynamics with day parts returning to more normalized levels. How should we be thinking about that one?

[Tony Hull:]

I think the other operating expenses, excluding royalties and advertising were a little bit higher, because of the February storms than we had forecast. But we think they will be in the – stay in sort of at the 11% type of range of sales for the rest of the year, 11% plus or minus. We don’t see a big increase. It increases a little bit in the fourth quarter probably, but not a material, it’s not a material change. We also, Jeremy, one other things is in that other operating expense, the reason there might be a little bit of pressure that is we are putting in some sort of more high-tech safes in our stores that basically they automate the process, they basically give us credit for the cash, the minute it’s deposited into the vault as opposed to waiting for someone to pick it up or waiting for one of our employees to bring it to the bank. So, that’s a bit of an investment we are making this year. But it’s – again, it’s not going to move the needle that much. And we think it’s really the right long-term. It allows the teams that we have in the store to spend more time in the store. So, we think it’s – we are going make it up on labor for the most part. So, I think that’s the only increase we are seeing and then maybe a little bit from more usage of the dining room. So right now, the usage is really small, a dining room. So, that could come up a little bit. But I again, I don’t think this is going to move any needles this year, that much one way or another.

[Jeremy Hamblin:]

Okay. And I just want to clarify on the G&A expectations for the year, excluding obviously anything related to acquisitions you expected that kind of flattish on a year-over-year basis?

[Tony Hull:]

Yes, percentage of revenue, yes. I mean, it will probably on an absolute basis a bit, because the biggest thing in there is that in the second quarter in particular, we reduced salaries. And then we also had lower travel last year. So, I think travel is coming back a bit and then we are not doing that salary reduction per quarter. So I think that will be a bit of a headwind. But I think what you saw – again, I think as a percentage of sales, it’s going to be pretty consistent to last year.

[Jeremy Hamblin:]

I am sure Dan is raring to go on getting back out on the road.

[Tony Hull:]

I think he is out on the road.

[Jeremy Hamblin:]

Alright. Thanks guys for taking the questions and best of luck. Thanks.

[Tony Hull:]

Thanks, Jeremy.

[Operator:]

Our next question comes from the line of Brian Vaccaro with Raymond James. Please proceed with your questions.

[Brian Vaccaro:]

Hi, thanks and good morning. I wanted to circle back on the new chicken sandwich and appreciate the – what you said the 10 more units a day with no added support and the potential of double with support. Dan, can you just help us frame what’s the base there? How many units a day on average? Were you selling a deal of the prior chicken sandwich?

[Dan Accordino:]

About 28 on the prior chicken sandwich and the current volume is about 38 to 40. And the expectation will be when it’s advertised it will get to about 75 units a day.

[Brian Vaccaro:]

Alright, great. And I appreciate all the color on the monthly trends and the regional details as well. But just to tie the bow on sales, could you help me with where average weekly sales volumes in dollars were for Burger King in March and April? I was just hoping that you could help us cut through your 2-year comps, seasonality, calendar shifts etcetera, just to make sure we are on the same page?

[Dan Accordino:]

For Burger King, we were hitting like $30,000.

[Brian Vaccaro:]

Okay, that was pretty stable in March and April.

[Dan Accordino:]

Went up a little bit, but yes, the average it was about 30.

[Brian Vaccaro:]

Okay. Alright, great. And then just on the menu pricing, Tony, what was the – I missed it sorry that you were talking about Q1 some components, but what was first quarter pricing in the menu? And then what’s the – I think you said you took 2%, is that how much there will be in the menu you expect or is there some from prior increase as we should take into account, just trying to get a sense of effective pricing in the next couple of quarters?

[Tony Hull:]

I think, Dan, the 2% was late March early April that didn’t really affect the quarter. I think that from last year’s price increase, it was about 50 bps in the first quarter.

[Dan Accordino:]

Yes. That’s right, Tony. We only had a 0.5% essentially in the first quarter, Brian, because the 2% didn’t take effect until almost the last week of March. In terms of expectations for the balance of the year, we will see what happens in the competitive environment as well as input costs and there is an opportunity for us to take additional pricing as we approach Q4.

[Brian Vaccaro:]

Alright. That’s great. And then last one for me, did you complete any sale leaseback transactions in the first quarter?

[Dan Accordino:]

Think so. I think there was one…

[Tony Hull:]

I don’t believe so.

[Dan Accordino:]

Yes, I think there is one – I think there was one in early April, but nothing in first quarter.

[Tony Hull:]

No, that’s right.

[Brian Vaccaro:]

Okay. Alright, thank you. I will pass it along.

[Operator:]

Our next question comes from the line of Jim Sanderson with Northcoast Research.

[Jim Sanderson:]

Hey, thanks for the question. I just wanted to follow-up on the discussion of breakfast. I think you mentioned that your day part sales mix is relatively stable, pre to post-pandemic. How does the margin look for that day part? Has it contributed to the improvement this year, just any feedback on that margin impact for the breakfast day part?

[Tony Hull:]

I mean, it’s a smaller part of it. It’s 13%, 14% of the mix. So I don’t think it’s had a big impact one way or another on the margin as of yet. It definitely helps sales.

[Jim Sanderson:]

It definitely helps sales, but the margin rate is relatively stable as far as its contribution is that the way to look.

[Tony Hull:]

Yes, thank you.

[Jim Sanderson:]

Yes. Just a quick follow-up, the lower promotional discounts that didn’t have an impact on breakfast margin, is that also the way to look at it?

[Tony Hull:]

It’s definitely – it’s small compared to the impact during lunch and dinner.

[Jim Sanderson:]

Alright. Alright, thank you.

[Operator:]

Our next question comes from the line of Jake Bartlett with Truist. Please proceed with your question.

[Jake Bartlett:]

Thanks for taking the follow-up. Tony, I am a little confused on the monthly same-store sales in the 2-year stack versus the commentary that both March and April were up 10% versus 2019. When I look at a kind of 2-year geometric stack, it looks like March would have been up about 25% and April up about 3%. So, just because the compares get a little easier, if the comp gets lower than in March. So how do you explain that?

[Tony Hull:]

I mean, those are the numbers. We just looked at – we looked at compared to 2,000, maybe one is at stack and one is just comparing to 19%. So, 10% is the aggregate increase from 2019.

[Jake Bartlett:]

Okay, but there was no deceleration in April that you could discern?

[Tony Hull:]

No. No, April was very strong.

[Jake Bartlett:]

Okay. And then if you could clarify, I know you gave us in the matter of operating days, but maybe just for Burger King and Popeye separately, could we quantify the impact of forms on the first quarter same-store sales?

[Dan Accordino:]

I don’t have the breakout by brand, maybe Tony does, but I will tell you it negatively impacted Popeye’s much more than Burger King, because most of the difficulty we had were in Memphis and Jackson, Memphis, Tennessee and Jackson, Mississippi, where we got a big penetration of our Popeye business. And we had Popeye’s restaurants that were closed for over a week, because they had no water. The infrastructure there is somewhat inadequate and the pipes froze. So, we didn’t have any – the city didn’t have any water. So, we were open – we were closed in many Popeye’s in those markets for over a week.

[Jake Bartlett:]

Got it. That’s helpful. And then lastly, just to build on Brian’s question about the menu pricing, you had 0.5% when you added 2%. Should we assume that that it’s 2.5% pricing barring any other increases or do that 0.5% roll off and get replaced with?

[Dan Accordino:]

No, but the 0.5% rolls off, so you’ve got 2% until we decide what we are going to do going forward. And in the first quarter, we only have 0.5%. That’s the way to think about it.

[Jake Bartlett:]

Got it. Great. Thanks a lot.

[Operator:]

Thank you. At this time, I will turn the floor back to management for closing remarks.

[Dan Accordino:]

Thanks everyone for participating in the call and we look forward to speaking to you one on one to the extent you want to speak to us one on one. And we will talk to you in August on our Q2 results.

[Operator:]

Thank you. This will conclude today’s conference. You may disconnect your lines at this time and thank you for your participation.