El Pollo Loco Holdings, Inc.

leases being signed for projects for next year gives us even more confidence in being able to accelerate far beyond the 10 that we have this year. We're not giving a firm number yet for next year. Hope to do that in the upcoming months, but can safely say you'll see some nice growth off of the 10.

Great. I appreciate it. Yeah, thank you.

The next question is from Andy Barish from Jefferies. Please go ahead.

Hey, good afternoon, guys. Anything other than just the backdrop that you described? I mean, March seemed to fall off. Was it just Mango Habanero kind of ran its course or anything you can point to on the month of March that you didn't address in your prepared remarks?

Yeah, the one additional would be the weather. And I always hate to bring up Mother Nature, but given the prominence of Southern California, usually I know weather isn't a big thing in California. But in March, we had actually about three weeks of rain. And you always see an impact, particularly on our lunch business when it's raining, a little bit on our dinner business, but it's pronounced. And so that would be the other piece that was a true headwind in March. In addition to just all of the macro, just the uncertainty, you could just see the consumer reacting to that. And also, I guess the other point would be we launched Mango Habanero in January, so we got that nice pop in trial in January, February. And although we got great customer reactions, some of the repeat could have been stronger as we were running it out into the third month of a product. And just some of our operational execution, if I'm being really honest. I think could have been better in terms of just having that repeat be even stronger. So coupled with the weather and the consumer malaise, it just meant for a softer March than we had seen in January and February.

Got it. And then, yeah, can we drill down a little bit operationally? I mean, it seems to be something you're picking up with the consumer feedback with SMG that there's some gaps. Is that something where it's labor hours or an investment that's needed at this point? Or is it kind of like, you know, we can look at kiosk and that reallocation can kind of occur and as obviously inflation sort of moderates, you know, maybe that frees up some opportunity to address some of the gaps?

Yes, I see this as, you know, I think SMG was a nice awareness for us that some of the gaps in our operations are really things that we can fix and are in our control. So things like accuracy as an example, making sure our team members are doing a triple check, you know, when, you know, consumers are in a drive-through, just, you know, Simple things like hospitality, making sure our service is even more friendly and hospitable, and when there is a problem, addressing it with customer recovery. So it's kind of a back-to-basics program where we're putting those back-to-basics in place. And then the other piece is this brand has been such a great brand with high-quality food. having that consistency in the quality of service has is something that i as i've been out in restaurants i've seen as a huge opportunity we have some restaurants that operate really really well maybe there's a general manager that's been there for years and they just they run a great restaurant and then there's some on the other end and raising those on the other end We've never had, or I shouldn't say never, in the last couple of years, we haven't had as clear of a standards program and a standard third-party audit. So just putting back in place some of those fundamentals that every restaurant company I've been with has in place in terms of driving operations, I think there's some real low-hanging fruit that can get us back some transactions fairly quickly. So it's, like I said, a back to basics. And our operators have, you know, taken this on with bigger. Our franchise partners are leading some of the efforts as well. It's a true team effort.

Got it. And then finally, just on the kiosk update, kind of where is that in terms of the rollout through the system more broadly? And, you know, what are you seeing from that? Is it... You know, is it giving you some benefit? Is it, you know, kind of more still in need of more uptake from the consumer? How are you kind of looking at kiosks these days?

Yeah, it's in most of our company restaurants. We still have a handful, 20 or so, that we need to get it in as we're kind of remodeling for the balance of the year. Some of the more, you know, difficult configurations that require a little more work And we'll be trying to do those through the balance of the year. There's a fair amount of franchise uptake as well. But I think where the opportunities lie is really how we take the next step with the kiosk and use it as a merchandising tool to really help us drive check and a little more guest engagement than just really kind of order taking right now.

Okay. Thanks for the time, guys. Thank you.

Ladies and gentlemen, we have reached the end of today's question and answer session. I would like to turn the call back over to Liz Williams for closing remarks.

Thanks again, everyone, for your interest today in El Pollo Loco. We look forward to talking with you again next quarter. Have a wonderful evening.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.