Kura Sushi USA, Inc.

Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to the Kura Sushi USA, Inc. Fiscal Fourth Quarter 2026 Earnings Conference Call. At this time, all participants have been placed in a listen-only mode, and the lines will be open for your questions following the presentation. Please note that this call is being recorded. On the call today, we have Hajime Uba. President and Chief Executive Officer, and Benjamin Porten, Senior Vice President, Investor Relations and System Development. And now I would like to turn the call over to Mr. Porten. Please go ahead.

Thank you, operator. Good afternoon, everyone, and thank you all for joining. By now, everyone should have access to our fiscal fourth quarter and fiscal year 2026 earnings release. It can be found at www.crowsushi.com in the Investor Relations section. A copy of the earnings release has also been included in the AK we submitted to the SEC. Before we begin our formal remarks, I need to remind everyone that part of our discussions today will include forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance, and therefore you should not put on your reliance on them. These statements are also subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. We refer all of you to our SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial condition. Also during today's call, we will discuss certain non-GAAP financial measures which we believe can be useful in evaluating our performance. The presentation of this additional information should not be considered in isolation, nor is it a substitute for results prepared in accordance with GAAP. and the reconciliations to comparable gap measures are available in our earnings release. With that out of the way, I would like to turn the call over to Jimmy.

Thanks, Wayne, and thank you to everyone who's joining us on our call today. As we look back at our fiscal 2026, I'm proud of our efforts to protect the margin in spite of tax and consumer headwinds. While tariffs collectively increased our cost of goods sold and other costs by 180 basis points over fiscal 2025, we were able to offset these increases with labor leverage of 190 basis points over the prior year driven by the technological innovation that is core to our concept. Our continued commitment to G&A leverage is reflected in the 90 basis point improvement over the prior year, and we were also able to grow at a significant margin of dollars over the prior year. As we enter the new fiscal year, I would like to share how our priorities have evolved as Kura has matured over the last decade. What began as a local culture favorite brand is now the undisputed leader of the American sushi space. Prior to Kura Sushi, there have been no nationally successful chains, despite the increasingly broad popularity of sushi in the United States. Over the last two decades, we have addressed and solved each of these scaling challenges, and we are now in 25 states with over 100 restaurants right around the corner. Having completed our national BGH strategy, I would like to share our major new mid-term goal, We expect to generate qualitative free cash flow and become self-funding by 2031. This goal hinges on two factors, returning on our historical 20% restaurant-level operating profit margins over this time period and normalizing our annual unit growth strategy from a percentage-based one to a unit-based one where the annual unit opening count continues to increase each year. This normalization of our unit growth approach delivers two major expected benefits. The extension of our cash runway through self-funding status and the elimination of the need for future capital raise. Now, I would like to move on to discuss our recent results. Total sales for the fiscal fourth quarter were $88.9 million, representing comparable sales of negative 5.7%, with negative 11.5% of traffic, offset by positive 5.8% in price and mix, with effective pricing for the quarter of 4.2%. Over the last year, we have seen mix reach all-time highs, and this trend has only become more pronounced. Cost of goods sold as a percentage of sales were 29.7% as compared to 28.4% in the prior year quarter due to the impact of tariffs. Our full year costs came in exactly in line with our expectations of 30%. Labor as a percentage of sales improved by 70 basis points to 30.4% due to operational initiatives. One of our goals for FY26 was to improve labor by 100 basis points over the prior year and I'm incredibly pleased to share that our full-year labor leverage over FY25 nearly doubled our goal at 190 basis points of improvement. Turning to unit development, we opened four new restaurants in the fourth quarter, Tulsa, Oklahoma, Austin, Texas, Charlotte, North Carolina, and the Pacific in New Jersey. Oklahoma and North Carolina are both new markets for us, and initial guest response has met all of our expectations. Subsequent to quarter end, we opened three new restaurants, Glen Allen, Virginia, Des Moines, Iowa, and Denver, Colorado, which opened just yesterday. Iowa is another new market, and while it has only been open for a few weeks, it's off to a great start. In keeping with our mid-term strategy, our unit opening expectations for fiscal 2027 are 17 new units. We currently have seven restaurants under construction, but fiscal 2027 openings overall will be heavily backlogged, with current expectations of four openings in Q1. two openings in Q2, five openings in Q3, and six openings in Q4. I'm excited to share more of our fiscal 2027 IP pipeline. We're currently in our YOSHI campaign, which runs through November and December. Our Q1 comparable sales to date of negative 3.1% are a meaningful improvement on Q4. and we are excited for the YOSHI campaign we have slated for November and December. Following YOSHI, we have Hatsune Miku in January and Gazeera in February and March. We have four more IP collaborations for fiscal year 27 following Gazeera and I look forward to sharing more of our IP pipeline in our next funding school. On the note of our IP collaborations and big carbon prices, I'm pleased to share that We have fully rolled out our Ikura PON dessert voucher option at all of our restaurants. Now guests have an appealing price to look forward to regardless of their familiarity with a given IT campaign. We believe this will be a potential opportunity for reductions in other costs as we adjust Ikura PON price order volumes to reflect the revealed preferences of our guests. In other system development news, we closed the fiscal year slightly ahead of robot dishwasher retrofit schedule and with 33 retrofits completed today, we have just under 20 remaining. Starting midway in fiscal year 2027, all new openings will have robot dishwashers as a default feature. While we are pleased with the improvement in price and mix, traffic in the fourth quarter did not meet our expectations. We've implemented several initiatives primarily focused on value to improve traffic with the goal of achieving qualitatively comparable sales on a three-year basis. In order to further bolster our value proposition and in an effort to recapture traffic, We have made the decision to take no pricing to offset the 3.5% that rolled off at the beginning of November. While our pricing strategy will remain flexible, we believe that we will be able to continue to grow margin over the prior year without taking price, and that the tariff shock to sushi industry pricing is a major opportunity for us to capture a larger audience. Before moving on to our financials, I would like to thank all of our team members, also at our restaurants, at our support center, for the great work they have done to provide excellent guest experiences while protecting margin in a challenging environment. Now, I'll hand it over to Ben to discuss our financials and liquidity.