TravelCenters of America LLC (NYSE:TA) Q2 2020 Earnings Conference Call - Final Transcript

Aug 05, 2020 • 10:00 am ET

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TravelCenters of America LLC (NYSE:TA) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

We will now begin the question-and-answer session. [Operator Instructions] The first question comes from Brian Maher of B Riley, FBR. Please go ahead.

Analyst
Bryan Maher

Good morning, guys. A couple of questions on my end. Let's start with the June numbers. To clarify, the truck service, store and retail services for June were all up year-over-year over last year's June, is that correct?

Executive
Jonathan M. Pertchik

Peter, do you have that?

Executive
Peter J. Crage

I would not say up over last year. We saw a sequential improvement, particularly in the restaurants as they opened up. But for example, in the restaurants, no, we still had a number of restaurants close. In truck service, as Jon mentioned, yes, we saw improvement in that in the June time frame, so hopefully, that answers your question.

Analyst
Bryan Maher

Right. And I...

Executive
Jonathan M. Pertchik

And Bryan, just to add, it's Jon. The trend line for sure between April and May into June, we saw improvements. Putting aside the full service restaurants and gaming, which appears in Other for us, the other non-fuel areas were improving through the end of the quarter. In early results in July, we've seen that improvement to continue.

Analyst
Bryan Maher

Okay. And then moving on to the full service restaurants, I think you said that there were 129 that have reopened now. How many are still closed?

Executive
Jonathan M. Pertchik

That roughly gets us through 50% are open, 50% are closed. And the ones that are open are open on, as we pointed out, just to give a little more color, are open on very much more limited menu items, which gives us, in turn, some benefits in terms of labor costs, limited hours in most places. So we're running them more efficiently, but approximately half are open and half are closed. And we monitor that very carefully, as changes in both demand and then also the state treatment of our ability to open or not. But both demand and ability to open, we look at, obviously, very, very regularly and we're making changes accordingly.

Analyst
Bryan Maher

Okay. And given the experience that you had with closing all these restaurants and then reopening them, are there full service restaurants in the portfolio that were just such clear money-losers, that they may open in a different way, or not reopen at all, or have a dramatic change in the menus? And what are your thoughts on the IHOP conversions, speeding them up or not, based upon the experience you had with the first one that opened?

Executive
Jonathan M. Pertchik

That's a great question, Bryan. As a transformation or turnaround guy, you don't often get the opportunity -- and I say this sort of carefully or cautiously. But you're not given the opportunity to turn something like that off and see what happens. And COVID, while it's been horrible for the country and in every other respect, it gave us the opportunity to learn and we're very much focused on using this opportunity to learn. And so it's premature to say, will we close any restaurants, I'm not sure about that. But what I know