Ruth's Hospitality Group, Inc.

Good morning, ladies and gentlemen. Welcome to today's Ruth's Hospitality Group third quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode. Following the company's formal remarks, we will conduct a question and answer session. Instructions will be provided at that time for you to queue up for questions. As a reminder, today's conference call is being recorded. I would now like to turn the conference over to Mike Hines, Vice President of Finance and Accounting. Please go ahead.

Thank you, David, and good morning, everyone. Joining me on the call today is Cheryl Henry, our President, Chief Executive Officer, and Chairperson of the Board, and Christy Chipman, our Chief Financial Officer and Chief Operating Officer. Before we begin, I'd like to first remind you that part of our discussion today will include forward-looking statements. These statements are not guarantees of our future performance, and therefore, undue reliance should not be placed upon them. We would also encourage you to refer to the investor relations section of our website at rhgi.com for copies of today's earnings press release and our recent filings with the SEC for a more detailed discussion of the risks that could impact our future operating and financial results. During this call, we will refer to adjusted earnings per share. This non-GAAP measurement was calculated by excluding certain items. We believe that this measure represents a useful internal measure of performance. You can find a reconciliation of adjusted earnings per share in our press release for today's call. I would now like to turn the call over to the company's Chief Executive Officer, Cheryl Henry.

Thank you, Mike, and good morning, everyone. Our commitment to serving the highest quality food with genuine hospitality has always been the core of who we are. And I could not be more proud of our team members as they embody this commitment every day. We continue to utilize Ruth's exceptional brand equity and strong capital position to make necessary investments that strengthen our operations and guest experience while strategically building the team our restaurant base and our digital infrastructure for continued growth over the long term. Turning now to the third quarter, we delivered solid results in part from the continued demand from our just because and special occasion guests. We realized strong top line momentum demonstrated by our more than 11% comparable sales growth over 2019. We also successfully managed ongoing inflationary pressures resulting in strong adjusted earnings per share of 16 cents and adjusted EBITDA of 12.3 million. Outside of last year, this is the best third quarter performance the company has had and landed in line with our internal expectations. Beyond these numbers, we continue to make progress growing our business organically, including investments in new restaurants, relocations, remodels, and digital technologies. Let's begin with an update on our development plan. During the third quarter, we opened three new restaurants, including Long Beach, California, Worcester, Massachusetts, and Melville, New York on Long Island. In addition, last week we opened our relocated Winter Park, Florida location, upgrading our hometown restaurant to modern brand standards. This is part of our ongoing remodel and relocation efforts, which also includes remodels in our restaurants in Nashville, Biloxi and Garden City New York to be completed by the end of this year. Looking ahead we remain confident in our ability to develop at least five new units annually. As we prepare for 23 we have signed four agreements and are actively working to confirm a fifth opening for the fourth quarter. We recently signed a new lease in Jupiter Florida for late 23 or early 2024. and are in final stages of lease negotiations for another 2024 location. Moving on to our investments in digital technologies, phase one investments included our booking, capacity, and guest experience platforms, point of sale, and labor management software. These investments have already generated efficiency in the business and give us increased confidence that further digital investment will benefit our shareholders. To that point, we are beginning phase two with a new inventory platform, enhanced reservation website, and a new data-driven and targeted paid media program. To lead these digital efforts, we're in the process of hiring a chief commercial officer who will continue to develop and drive our digital transformation. producing actionable insights to enhance our ability to deliver on our exceptional steakhouse experience. Our new CCO will also lead our new approach to marketing that leverages our deeper knowledge of the guests as well as insights so that we are even more targeted with our marketing efforts to maximize sales and profitability. Investing in new restaurants and other growth initiatives has always been part of our balanced and disciplined approach to capital allocation. The second part of that approach, which has also been very consistent over the years, is returning excess capital to shareholders through debt reduction, dividends, and share repurchases. To that point, we returned over $20 million of excess capital to shareholders during the quarter. We paid down $10 million in debt paid $4.9 million in dividends at $0.14 per share, and repurchased $5.4 million of shares. In all, we believe these actions have and will continue to position us for sustainable growth and long-term value creation. I'll now turn the call over to Christy to cover the specifics of the quarter.