Red Robin Gourmet Burgers Inc. (NASDAQ:RRGB) Q2 2020 Earnings Conference Call - Final Transcript

Aug 11, 2020 • 05:00 pm ET


Red Robin Gourmet Burgers Inc. (NASDAQ:RRGB) Q2 2020 Earnings Conference Call - Final Transcript


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Good afternoon, everyone, and welcome to the Red Robin Gourmet Burgers, Inc. second-quarter 2020 earnings call. Please note that today's call is recorded. During today's call, management will be making forward-looking statements about the company's business outlook and expectations.

These forward-looking statements and all other statements that are not historical facts reflect management's beliefs and predictions as of today and, therefore, are subject to risks and uncertainties as described in the safe harbor discussion found in the company's SEC filings. During today's conference call, management will also discuss non-GAAP financial measures. These non-GAAP measures are not prepared in accordance with generally accepted accounting principles but are intended to illustrate an alternative measure of the company's operating performance that may be useful. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures can be found in the earnings release.

The company has posted its fiscal second-quarter 2020 earnings release and supplemental financial information related to the results on its website at, in the Investor Relations section. Now, I would like to turn the call over to Red Robin's CEO, Paul Murphy.

Paul Murphy

Hello, and thank you for joining us. Let me begin by saying that I hope everyone on the call and your loved ones are safe and healthy during these tumultuous times. With me today is Lynn Schweinfurth, our chief financial officer, who will provide a detailed update on our liquidity and then review our quarterly results. But first, I would like to discuss where we are with the business and what our plans are for the remainder of the year and beyond.

Following the initial outbreak of COVID, we set the following priorities for our business: one, secure the long-term viability of Red Robin to increased liquidity; two, ensure the health and safety of all team members and guests; three, leverage our off-premise channel to drive sales and opportunistically reopen our dining rooms; four, reduce expenses and improve flow through on lower sales; and five, position Red Robin for a recovery and future growth. Preserving liquidity and the long-term viability of Red Robin included several immediate and, in some cases, difficult actions, reducing salaries, eliminating a material number of corporate positions, significantly reducing spending at both the restaurant and corporate levels, renegotiating our credit agreement, raising approximately $30 million in capital through our at-the-market equity offering, and within the next 12 months, generating significant cash tax refunds. As a result, as of August 9, we have substantially improved our liquidity since last quarter to more than $103 million between cash and cash equivalents and available borrowing capacity. I am confident that we have the liquidity capacity to emerge from this period a stronger, more profitable enterprise.

Red Robin has not only persevered over the past several months. We have used the focus created by the pandemic to improve the quality of our operations and build trust and loyalty with our guests that will pay dividends long into the future. Even with all the past and recent