Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from David E. Tarantino – Robert W. Baird & Co.
David E. Tarantino – Robert W. Baird & Co.
Jack, a clarification question first on the comps, with the traffic figure you mentioned down 3.5, did that include a drag from the Easter shift and if so could you just quantify what the traffic was including the Easter shift.
John R. Hartung
It did, we lost a day in the quarter, we had one fewer day than last year and we figure that day cost us roughly about 1%. There were really David three things that occurred during the quarter that are factored in the 1.7%. The other thing is we did lose about 2.5% in menu pricing so we dropped down in menu price affect during the quarter. The other thing is we’re going up against softer comparisons compared to last year so all those three things kind of weighed together to net to the 1.7%.
David E. Tarantino – Robert W. Baird & Co.
On an underlying basis if you exclude the Easter shift then traffic improved by about 200 basis points from Q1 if I’m reading that correct.
John R. Hartung
That’s right.
David E. Tarantino – Robert W. Baird & Co.
Would you chalk that up to easier comparisons or was it some of the initiatives you have in place that you think moved the needle.
John R. Hartung
Just to clarify David, we were 4.5% negative in the first quarter, we’re 3.5% in the second quarter and we did lose a day so if you adjust for the day then effectively we’re closer to 2.5% negative traffic. It was really entirely related to comparing to easier comparisons last year.
David E. Tarantino – Robert W. Baird & Co.
Is there any reason to believe as you move out in to the second half and the comparisons ease further why you might not see the traffic continue to improve on a year-over-year basis?
John R. Hartung
I want to be really cautious about that. We do have easier comparisons in the third quarter, we have tougher comparisons in the fourth quarter because we lose basically all of the price increase right now, by the end of the year we lose all of it. We’re not seeing signs, credible signs that consumer confidence is improving. We know unemployment is expected to get worse and so it seems like David things are at best moving kind of sideways right now from a trend standpoint. So, I would hope the easier comparisons would allow us to have respectable comps but we’re being really, really cautious. We’re just not seeing positive signs from the consumer confidence side.
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