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spk07: Greetings and welcome to the One Group Second Quarter 2002 Earnings Conference Call. At this time, all participants are in listen-only mode. A brief question and answer will follow the formal presentation. Whenever the question session begins, you may ask a question by pressing star then 1. Press star then 2 to remove yourself from the list. As a reminder, this conference call is being recorded. And now I'd like to turn the conference over to your host today, Tyler Loy. Please go ahead.
spk06: Thank you, Operator, and hello, everyone. Before we begin our formal remarks, let me remind you that part of our discussion today will include forward-looking statements. These forward-looking statements are not guarantees of future performance, and you should not place undue reliance on them. These statements are also subject to numerous risks and uncertainty that could cause actual results to differ materially from what we expect. Please also note that these forward-looking statements reflect our opinion only as the date of this call. We undertake no obligation to revise or publicly release any revisions of these forward-looking statements in light of new information or future events. We refer you to our recent SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial conditions. During today's call, we will discuss certain non-GAAP financial measures, which we believe can be useful in evaluating our performance. However, the presentation of these measures or other information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. For reconciliations of these measures, such as adjusted EBITDA, adjusted net income, restaurant operating profit, comparable sales, and total food and beverage sales at owned, managed, and licensed units to GAAP measures, along with a discussion of why we consider these measures useful, please see our earnings release issued today. With that, I'd like to turn the call over to Manny Hilario. Manny?
spk03: Thank you Tyler and hello everyone. We sincerely appreciate you joining us today and for your interest in the one group. Our focus on strong operational execution, innovative culinary offerings and vibe dining continues to resonate with our guests and I'm extremely pleased with our top line business performance during the second quarter despite the ongoing challenges facing our industry. I thank our entire team for these results and for providing our guests with exceptional and unforgettable dining experiences each and every day. The strong sales momentum we experienced in the first quarter continued into the second quarter. Our total revenue grew nearly 15% to $81.1 million when compared to the prior year's second quarter. Our comparable sales continue to be among the best in the restaurant industry. Consolidated comparable sales increased 12.8%, consisting of an increase of 19.8% at SDK and a 3.7% increase at Corner Growth. Impressively, and also among the best in the industry, when compared to 2019, our pre-pandemic base year, consolidated comparable sales increased 53.5%, consisting of an increase of 81.9% at SDK and a 27.6% increase at Kona Grow. Our second quarter U.S. average weekly sales were equally impressive at $331,000 for SDK compared to $288,000 in the same period in 2021 and $107,000 at Kona Grow compared to $103,000 in the same period in 2021. We are also pleased with delivering over $4 million in net income and $10.4 million in adjusted EBITDA for the quarter. Since before the pandemic, we embarked on a mission to diversify our sales mix away from being heavily focused on corporate and event-driven business. Instead, we have been strategically capturing the special occasion business, which includes date nights, holidays, ladies' night out, brunch, happy hours, and other social occasions. This strategy continues to pay dividends as reflected in our industry-leading results. However, after two years of limited corporate gatherings, we are now seeing group events and conventions return, and we have been able to capture that demand. In addition, we continue to build our catering capabilities and believe that private events and catering offer tremendous opportunities for the brands. We also focus our attention on creating incredible value offerings for both SDK and Pinnacle World. This allows us to expose our brands to new guests at approachable price points. Guests then remember us for their celebratory occasions and come back and join us in our dining rooms. It also allows us to capture demand during times when there is excess capacity. At both brands, we are currently running several value-driven programs, such as our weekday power lunch, midweek date night promotions, pre-theater menus, and several takeout and delivery specials. For the more, we continue to leverage the important brunch day part with bottomless mimosas and our new 369 happy hour menu. Throughout the second quarter, we captured demand for holidays with our promoting round Easter, Mother's Day and Father's Day at Kona Grill and SDK. As a result of these efforts, we achieved some record-breaking sales during these holidays. Now turning our focus to development, we have an exciting pipeline of growth for both company-owned and managed and licensed deals this year, consisting of nine new SDK Kona Grills and F&B venues. In July, we opened our first of three virtual locations through a licensed deal with Reef Kitchens in Austin, Texas. Guests in Austin can now enjoy delivery of select menu items from our award-winning dining concepts, Kona Grill and Bao Yang. This partnership enables us to further expand and capture a new consumer base with limited capital investments. For the remainder of the year, we plan to open two company-owned SDK locations, one in Dallas and one in San Francisco. I manage SDK in Stratford, London, UK. Three company-owned corner grills, one in Riverton, one in Columbus, and last but not least in Paradise Valley, Arizona. And finally, we plan to open two additional license units in partnership with Beef Kitchens, which will provide takeout and delivery-only offerings from our corner grill and value-add concepts. As we have long stated, we are early in our growth strategy with significant white space ahead. We are excited about our long-term opportunity as we believe our units deliver best-in-class returns. For new restaurants, we're targeting between 40% and 50% ROIs for new company-owned SDKs and company-owned Kona grills. We foresee a total addressable market for at least 400 restaurants, including 200 SDK restaurants globally and at least 200 Kona grills domestically. Moving on to the current cost environments. As you are aware, we are currently in a period of historically high inflation across our industry. That said, I'm pleased that we were able to deliver cost of goods sold at 25.8%, only slightly higher than the first quarter. We were able to accomplish this through product mix engineering, selling high-margin additive check items such as toppings and sides, and committing to our beverage and bar programs. Turning to labor, we've seen noticeable increases in average wage year-over-year in both manager and hourly workforces. In addition, we have made investments to hire, train, and retain the best out in the industry. And we believe these strategies have allowed us to keep the significant market share we've captured. We're committed to remaining fully staffed in order to support our new unit growth and sales-driving initiatives. Lastly, we have taken modest price increases this year. With our strong traffic performance during the second quarter, along with our great value proposition for both brands, we believe we have significant pricing power and will strategically take some price increases in the back half of the year. To conclude, our team is doing a fantastic job providing our guests exceptional and unforgettable dining experiences. Ultimately, our focus on operations and day-to-day execution has proven effective in translating to a strong P&L, and we plan to continue our current trajectory of industry-leading comfortable sales, disciplined cost management, and new store development. Now I'll turn the call back to Tyler.
spk06: Thank you, Manny. Let me start by discussing our second quarter financials in greater detail. Second quarter total gap revenues were $81.1 million, increasing 14.6% from $70.8 million for the same quarter last year. Included in our total revenue is our own restaurant net revenue of 76.9 million, which increased 13.4% from 67.8 million for the same quarter last year. The increase in revenue is primarily attributable to strong sales and momentum resulting from the execution of our sales initiative along with the opening of new units. Domestic consolidated comparable sales increased 12.8% for the quarter compared to 2021. For STK, comparable sales increased 19.8% versus 2021, and Kona Grow comparable sales increased 3.7% versus 2021. Versus 2019, domestic consolidated comparable sales increased 53.5%, STK comparable sales increased 81.9%, and Kona Grow comparable sales increased 27.6%. Management license and incentive fee revenues were $4.2 million, increasing 44.1% from 2.9 million in the second quarter of 2021. This increase is primarily the result of the strong execution of our sales initiatives, capacity restrictions being lifted, and an increase in the number of venues. Owned restaurant cost of sales as a percentage of owned restaurant net revenue increased 50 basis points to 25.8% in the second quarter of 2022 compared to 25.3% in the prior year primarily due to increased product costs and partially offset by operational and menu management initiatives. Owned restaurant operating expenses as a percentage of owned restaurant net revenue increased 550 basis points to 57.6% in the second quarter of 2022 from 52.1% in the second quarter of 2021, primarily due to consolidated average wage increases. We are particularly pleased this quarter with the restaurant operating profit of 21.9% at SDK during this very challenging environment. On a total reported basis, general and administrative expenses were $7.3 million compared to $6.1 million in the prior year. The increase was attributable to increased professional fees and increased travel expenses due to rising hotel and airfare costs. When adjusting for stock-based compensation, adjusted general and administrative expenses were $6.4 million in the second quarter of 2022 and $5 million in the same quarter last year. We incurred approximately $0.2 million of direct costs related to COVID-19 during the second quarter. COVID-19 related expenses are composed primarily of sanitation, supplies, and safety precautions taken to prevent the spread of COVID-19. This compared to $1.1 million of similar costs last year. Interest expense was $0.4 million in the second quarter of 2022 compared to $1.2 million in the second quarter of 2021. The decrease was driven by lower average outstanding balances and lower interest rates driven by the refinancing of our credit facility in August of 2021. Income tax expense was $0.9 million in the second quarter of 2022 compared to $1 million for the second quarter of 2021. Our 2022 annualized effective tax rate is estimated at 19%. Net income attributable to the One Group Hospitality, Inc. was $4.3 million, or $0.13 net income per share, compared to a net income of $13.8 million in the second quarter of 2021, or $0.41 net income per share. When adjusting for COVID-19-related expenses and other non-recurring expenses and gains, Adjusted net income was $4.9 million, or $0.15 adjusted net income per share, compared to an adjusted net income of $6.5 million in the second quarter of 2021, or $0.19 adjusted net income per share. Adjusted EBITDA for the second quarter attributable to the One Group Hospitality Inc. was $10.4 million, compared to $12.9 million in the second quarter of 2021. We have included a reconciliation of adjusted EBITDA in the tables in our second quarter 2022 earnings release. I will now turn the call back to Manny.
spk03: Thank you, Tyler, and thank you all for your time today. Let me conclude by saying that our business remains very solid despite the obvious headwinds. We are in the early stages of our long-term growth strategy as we continue to build a portfolio of high-volume, high-margin brands with compelling returns. Above all, I'm grateful to all of our teammates who bring our mission to life every day to be the best restaurant in every market where we operate. They do this by delivering exceptional and unforgettable guest experiences to every guest every time. I also would like to thank our customers that visit and continue to return to our restaurants so that they can enjoy the highly differentiated vibe dining experiences that they have been craving. We appreciate everyone joining us on today's call. Tyler and I are happy to answer any questions that you may have. Operator.
spk07: Yes, thank you. At this time, we will begin the question and answer session. To ask a question, you may press star, then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To address your question, please press star, then 2. At this time, we will pause momentarily to assemble the roster. And the first question comes from Nicole Miller with Piper Sandler.
spk01: Thank you. Good afternoon. Super update. Just a couple quick questions. The first one, very high level. How is Europe? You know, how are you managing through? What are you seeing with consumer trends? How are things coming along?
spk03: I mean, this is Manny, by the way. So, Nicole, I mean, our London stores, continue to do well. I mean, we have not seen a major slowdown, but there's clearly a lot more noise in Europe in general economy. So there's definitely lots of noise. You know, we really haven't felt any significant impact out there, but that doesn't mean that that won't change anytime soon, though, because there's a lot of noise in the market.
spk01: Yeah, looking at MLI, you know, is up quarter over quarter dollars or, well, I guess year over year for sure. Sorry, I don't have the quarter-over-quarter in front of me. But, I mean, there's more units you operate in MLI, you know, as well. That's why I was just kind of trying to figure out any pattern there.
spk03: No, we haven't seen any significant difference. But, as a matter of fact, it held up pretty well in the second quarter.
spk00: Yeah.
spk03: But again, there's just a lot of noise out there right now, and we'll go through it.
spk01: And then this is just very curious about seasonality. So everybody knows how 3Q slows seasonally. Just any general comment outside of seasonal patterns you want us to consider, that would mostly be on store-level margin. But at the same time, 4Q becomes a big part of the year. And it's just so fascinating how you're holding on to all of these different types of customers at different occasions. So can you talk us through the scenario analysis, or I should say planning maybe you're doing for the fourth quarter? You know, good holiday, neutral holiday, bad holiday. How are you kind of wrapping your minds around what may come?
spk03: Yeah, so it's a very good question. So for the fourth quarter, Two things to consider. Number one is events, and we're actually starting to see a pretty decent amount of fourth quarter events, particularly in December. So I would say that that's actually a good leading indicator. And then relative to us, in the fourth quarter, if you think about December last year, we did have the beginning of Omicron, so we actually think that Relative on the lap, actually the fourth quarter is a good lap for us. So I would say that we have a good comparative or lap to go against. And I think that the leading indicator on events is actually very good for the fourth quarter right now. But again, remember last year we only saw the rebounding, slight rebounding on events. So that's why the pipeline relative to last year in events looks way better than we had last year.
spk01: And just the last one, the way you talked about the promotions you're running, you know, and offering both affordable options and just a total value proposition, how are you slicing and dicing your consumer data these days and what is it telling you? Meaning, is there something happening? It could be any, you know, which way, you know, by income, by geography. What are you seeing underlying these strong trends, please?
spk03: Yeah, so we do see a very positive trend at happy hour. We did launch our 369 price point happy hour, so we are seeing a lot of velocity in the earlier time periods. But then also interesting enough, because we do have a pretty good amount of high-end consumers, our high-end products continue to do extremely well. As a matter of fact, they were doing so well that we decided to extend our wide group promotion to the whole month of July. So we definitely see value bringing people in there. So we're marketing value. So if you look at our digital marketing, so we're utilizing the value messaging to drive people in. But interesting enough, particularly at SDK, we have seen a pretty large intent by consumers to trade up. So I would say that that consumer is holding up, frankly, rather well. And then, you know, Kona Growth, Obviously, the demographics are a little bit maybe not as high end as SDK relative to household income, but there we have supplemented our value messaging with a $7.99 cheeseburger for lunch, and that's doing extremely well. But what we saw there, though, is although we're offering a low entry price point on the cheeseburger, we have a $5 french fry option and bacon option and the take rates on those is actually extremely high. So we're actually seeing the consumers, although they're coming in for the low price points, I think that in store, we're doing a nice job of trading them up. So again, it's interesting. And by the way, the value that we have is everyday value. We've always been committed to value. But as we've always said in the past is that if need be, we would switch our marketing to value, which is what we're doing right now is really promoting the entry price points, but I'll tell you right now, I do see customers coming in for that, but they're actually going to the regular price points when they get to the restaurant. I have not seen any material trends where people are actually trading down or taking less items on the menu.
spk01: So in conclusion, now that you have a more normalized comp, because they've just been through the roof, can you talk about what price is in there and then I think you're counting entrees, at least on the SDK side, right, for comp. Can you talk to however you're calculating transaction traffic entree, essentially, to understand that measure?
spk03: Yeah, I mean, we use actually both. We use measures of checks, and we also use measure of heads or entrees for SDKs. We actually use both, and we were both in SDK as well as Kona Grill. So the metrics held up pretty well. What am I thinking from a trend perspective is that, you know, really the metric that we use is a three-year stack looking against 2019, which is our base year and making sure that we're holding up. So as you probably saw from the press release is that that's kind of our health metric, if you will, at least for a couple more quarters until we get to more normalized. I'm not really sure there's such a thing as a a normalized comp anymore, but we look at that baseline as a way of giving us some level of assurance as to how the business is doing. Relative to price, we have very little price in both STK and Kona Groyal, almost insignificant. We held off from taking more price in the second quarter because we wanted to measure how transactions and how consumers were behaving. We now feel a little bit more confident that we can you know, take advantage of our pricing power, and we're taking price this quarter at Kona Groyal, and we may do some minor touch-ups at SDK, but we do believe that, you know, there is actually room for pricing for us in the third quarter. That should actually help our margins significantly, particularly at Kona Groyal.
spk01: Thank you very much.
spk07: Thank you. And the next question comes from Nick Setian with Red Bush Securities.
spk04: Thank you. So did you guys expect, you know, over 500 base point uptick in operating expenses in Q2 versus last year? And if not, where, you know, where was that difference? And then just give us, if you can, just some, you know, some more details around what exactly transpired in the quarter for us to see that kind of an uptick in expenses.
spk03: Yeah. So the uptick on expense, I think Tyler mentioned this on his prepared statement is mostly, if not all, associated with average wage for hourly and manager labor. That has been the pressure point relative to that line item. And then, of course, we have chosen to keep our staffing at the restaurants at par. So we've kept all our restaurants fully staffed throughout the quarter. So the pressure point there is the fact that we are, you know, have had counts in our business model, and the wage has gone up. So in hindsight, probably the thing that we could probably have, you know, taken on a little earlier was pricing because we did not take pricing in the quarter. But, no, I mean, other than the labor, there was nothing really other significant on the P&L. Although, if you also think about it, any kind of service that is labor-intensive like janitorial, DJs, and stuff like that to also have exposure to labor rates. That's probably where I would say the pressure was on. In terms of other expenses, I think everything was pretty much in line with what we thought it would be.
spk04: And so going forward, like Q3, Q4, how should we think about margins in light of the incremental pricing you're taking?
spk03: So, I mean, I think for Kona Grow, we're thinking about 4% to 5% on price. So that should have a substantial impact on the Kona grill margins. And then SDK, we're thinking maybe one or two points, very select items. So I think those items will help the margin. Obviously looking at the SDK margin is still in the 21 plus range. So that one to 2% increase should put it back into the 22 plus range on the margin. And then, you know, the pricing at Kona Grill should bring it back up to the mid-double digit, right, so kind of 14, 15 range.
spk04: Okay. And then just a final question. Can you talk about, you know, just sales trends as the quarter progressed and maybe into July and, you know, whether you've seen any kind of slowdown in June or July? Okay.
spk03: I didn't see a slow – so April and May with the holidays, we did extremely – we saw very robust trends around the holidays. June was a different month. It wasn't so much that it was slowing down, but it was choppy where you would have some really strong days and some days that weren't as strong. So So it was a little bit more of a clump, you know, just choppy trend, if you will, in June, arguably a little bit softer than May. So of the three months in the quarter, that probably was the, you know, the most, the more, you know, slower of the three periods. You know, July, you know, is an interesting month because you start off with the Fourth of July holiday, and it's seasonally a very slow month for, particularly for urban downtown restaurants. So It's an interesting read, but, you know, we were, you know, relative to the three-year trend, we thought July held up pretty good. So that's kind of, you know, as I mentioned earlier with Nicole, is that's ultimately the trend that we see is that a three-year comp, as you can see from our prepared comments, is very, very strong. And we continue to believe that that's going to hold up reasonably well in the third quarter. Again, visibility is kind of, you know, is the million-dollar question with all the noise and the news and stuff. So, you know, that's the big unknown here. But as we've gone through, you know, the first couple weeks of the quarter, you know, things are shaping okay relative to the three-year trend.
spk04: Okay. Thank you very much.
spk07: Thank you. And the next question comes from Mark Smith with Lake Street Capital Markets.
spk05: Hey, guys. I want to dig in just a little bit deeper just as we look at the four-wall margins. Can you just give us any insight? Kona Grill looked like it had a tougher time on kind of restaurant-level margins. Walk through any puts and takes that maybe impacted Kona more than your SDK units.
spk03: So both were impacted on wage, hourly wage. And then the only different meaningful differential between Kona Grill and SDK is tuna prices in the quarter were much higher and tuna because of its sushi component uses more tuna. So I would say that that's the bigger difference between the margins on the two brands. And again, as I said on my previous answer, is that we didn't take pricing, and we do plan to take pricing now. So I think that's going to help bring the Kona Grill margin back to the mid-teens.
spk05: And did I hear you right? As you look at the two different consumers, the STK customer versus the Kona Grill customer, Did you see more change in behavior with inflationary pressure on that Kona consumer than you did on SDK?
spk03: I would say that the answer would be that the SDK consumer appetite for premium items is unchanged. So we see a tremendous amount of trade-off on the SDK. So we didn't really see any meaningful change. if any change at all. And then Kona Grow, we really, to be frank about it, we have not seen any discernible, predictable trend on either trade downs or people taking less items per check. But again, a lot of it, we don't see it because we're doing a tremendous amount of promoting. We have lots of activity going in the bar, as you know, from the 369. So a lot of our marketing activity helps offset maybe some of the macro trends. So perhaps the reason that we don't see it has more to do with the fact that we have these promotions more so than what's really the consumers doing, particularly at Kona Grill. Okay.
spk05: And then the last question for me, can you just talk about your non-comp restaurants and how those units are performing?
spk03: Non-comp restaurants would be, for instance, Bellevue. Bellevue is doing great. It's doing a $200,000 average weekly volume. What other non-coms do we have in there? I think everything else is pretty much on the comp.
spk05: All right, so no changes. But I guess as you look at new restaurants, is that what gives you some of the confidence in the – I think you target now 40% to 50% ROI on new units.
spk03: I mean, the new restaurants for us is really a function of the real estate. The real estate is fantastic. I think all the locations that we have planned out are A type of locations. So I think there's a significant value in the quality of the real estate. So, I mean, if you think San Francisco, which, by the way, is opening very shortly here, we're looking at – You know, 30 Mission, which is a great part of San Francisco, and then also Dallas is a fantastic, high-quality real estate, and Riverton and Columbus. So, again, I would say that it gives me confidence, the quality of the real estate, and all these places have very favorable indicators going for them. For instance, San Francisco, you're starting to see more office population in the city. and more population is better than zero, which was the historical number. So you're starting to see a lot more people in the city, and you did see a little bit more travel in there. And if you go to San Francisco and benchmark these days, you know, particularly on busier nights like Thursdays and Fridays, you're starting to see a lot of the inventory of restaurant seats being taken. So I think the indicator there is very, very good. And, you know, in Dallas, we – We put out ads for employees, and the demand for that property is very high, as validated by how many people want to join the team there, in my opinion. So I do believe that the real estate will do very well for us in the next set of restaurant openings.
spk05: Great. Thank you, guys.
spk03: Thank you, sir.
spk07: Thank you. And the next question comes from J.P. Wollum with Roth Capital Partners.
spk02: Hi, guys. I appreciate you taking the questions. If we could start briefly on brunch. I was just curious kind of what the dispersion looks like. You know, is most of brunch concentrated in a couple of locations? Are you seeing activity across all the STK locations? And then kind of as a follow up to that, how are you guys thinking about driving further growth in that brunch segment?
spk03: Yeah, so good question. So our performance in branches is pretty even across the board. We do have some locations that over-index just because of where they're at. So think of Vegas has a tremendous branch on Saturdays and Sundays. But overall, I would say that it's a pretty well-balanced branch. on the brunch day part on a per-restaurant basis. And then in terms of the growth opportunity there, we still think it's significant, and it's a matter of continue promoting it and just driving frequency with the guests. So far, we've been pretty happy with how that does in terms of growth. But we're early. Brunches, we're probably... on step one of step ten of what we can do with that program. We're looking at elevating the drink programs, adding some new features on products. So there's a lot of promoting and activities that we plan to really add interest to that day part. Remembering that any brunch program that offers quality alcohol programs is doing very well with the consumers, I think, right now, and it's And it's a fun day to go, you know, particularly Sunday brunch is a very high, you know, time that people like going out. So we feel pretty good that we still have a lot of runway on brunch. And promoting and product will be, if you will, the two things that will help us elevate to that day part.
spk02: Great. Thank you. And just sort of as we start thinking about 2023 and, you know, without asking you to guide to anything, you know, When we think about revenue growth, I guess, would you guys be disappointed seeing same-store sales flat or kind of unit growth on par with this year? Is there any way we should be thinking about that out next year?
spk03: So, I mean, at this point, just getting through the third quarter and visibility out is, as you know, is challenging based on all the noise. in the news and everything else out there. But again, I think the way we... So anytime we don't have positive comps, which I can't really remember in a long time for our company since I've been around, but it's something that we obviously try to stay away from. But here's the reality. The reality is, as we did during COVID, is whatever the hand is, we'll play the best we can within those circumstances of the environment. So I have a very strong confidence on the team's ability to be flexible and to pivot to areas that are still successful within the cycles. Now, again, when you have different economic cycles, not everything is bad. There's some places where you could still grow business, the higher-end consumer, trading up, all kinds of other strategies. So, again, it's just really about being flexible. pivoting and making sure that, you know, the team stays focused on our culture of always overperforming, over-indexing to the industry.
spk02: Perfect. And then just one quick last one for you guys, just on about development timelines. I know we've talked in the past, inspections, municipalities, kind of seeing a little bit of delays there. Are any restaurant openings kind of slipping later than expected? Thank you.
spk03: Yeah, I mean, I think the jurisdictions is certainly a challenge. I think one of the other challenges just in general relative to construction more recently is just mobilizing labor. I think there's, you know, the ability to get more laborers and just the labor... in construction is a little bit more challenging than it's been historically, or as I remember it. But again, we don't see anything insurmountable there. We're just going to have to be more flexible in how long it takes to open the restaurants and build them. Obviously, SDKs are big restaurants with a lot of moving pieces. So we just need to make sure that we give ourselves plenty of time to build the project with quality without over-driving the cost to get that done. So that's always the balance is cost and how you get these things built up. But in general, as I mentioned earlier, San Francisco is pretty much in its home stretch to open. We actually have all our employees training in San Francisco this week. So it's looking pretty good. And then Dallas is going to come immediately thereafter, and it's looking pretty good in terms of – of where we're opening that one too. So we're looking forward to continue opening these things.
spk02: Great. Thank you very much.
spk07: Thanks. Thank you. And this concludes the question and answer session. And now I'd like to return the call to Manuel Lario for any closing comments.
spk03: As always, I appreciate everyone's interest and support of the one group. And as I always conclude our calls here, none of our success and what we do is possible without the incredible work of our team. I'm very honored of being part of one of the best teams in the industry, and I appreciate that, and I look forward to seeing all of you out in our restaurants.
spk07: Thank you. The conference has now concluded. Thank you for attending today's presentation. May now
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