Jeff Farmer: Okay. Just one other quick one on the labor line. So that was favorable year-over-year, but I think even sort of more outstanding was the fact that it was 40 basis points better than what we, the street were looking for. So in terms of thinking about labor as a percent of revenue and just favorability year-over-year, do you expect that to continue in coming quarters or sort of that favorability you saw in the first quarter, maybe as good as it gets?
Mika Ware: Yes, Jeff, this is Mika. So in the first quarter, we really had some things moving our way with a favorable price and mix really helped to offset those investments into the hourly labor model. And we also saw some favorability in overtime because, as Kevin said, our turnover continues to decrease as we move into the second quarter. And Joe just talked about the cadence of our price, so it may not – we may not be able to have a year-over-year improvement. So especially because that second quarter is going to have it’s the last quarter that we have those investments to the hourly model in there. So I think you might see some deleverage next quarter.
Jeff Farmer: All right, thank you, everyone.
Operator: Your next question is coming from Jeffrey Bernstein with Barclays.
Jeffrey Bernstein: Great, thank you very much. Two questions. The first one just broader industry thoughts. Kevin, it seems like the industry maybe or casual dining industry is seeing a slowdown of late. Just wondering as you size it up, and obviously you’re just one piece within that. So congratulations on moving counter to that. But just wondering, as you think about the industry, how much of it do you think is just consumer headwinds finally taking hold versus some have talked about a return to seasonality, and obviously we talk about lapping pricing. So it seems like there’s three components within there. I’m just wondering how you think about it for the broader industry that you compete?
Kevin Hochman: Yes, the seasonality thing, I think was probably real if we look in hindsight, so that the return to back to school seasonality that we typically saw as a casual dining segment pre-pandemic. So we think that was real. It’s probably what we saw in late August, early September. As far as like why do we think we’re reversing the trend versus what we’re seeing in the industry? I do think that the value is helping. Right? We have a very – we’ve been talking about it for a year now and about having unbeatable value regardless of the channel of restaurant that you compete in. I saw a Tweet the other day, they were comparing us versus the big guys in QSR and their combo meals versus our number are $10.99 and that’s kind of what we’ve been talking about the last year.
And so maybe the improved performance of the advertising part of that is driven by where the customer is. You never know for sure. We certainly have not seen it in our data that the customer is tailed off. We’ve seen just the opposite, but that could be a function of what we have in market. And we had talked about if there was a downturn, what are the things that we’re going to do? It’s the same things that we’re going to do whether there’s a downturn or not, which is continue to improve the customer experience, improve the Core Four and then get back on air with advertising with outstanding value. And I still believe regardless of whether there’s the continued macro headwinds or not, that’s going to be the course of action for us if we want to continue to complete our resurgence as a brand.
So it’s hard for me to like comment about what they’re doing versus what we’re doing. What I do know is what we’re doing, regardless of what the macro is, is the right thing to do. And I think over the last couple of months has really paid some dividends for our business.
Jeffrey Bernstein: Got it. And as we think about profitability for the business, you had 400 or so basis points of restaurant margin expansion in the first quarter. I’m assuming that’s an anomaly based on comparisons and whatnot, but what do you think for full year 2024? I think last quarter you said, you’re going to see margin expansion beyond the normal target you would have would be 20 basis points to 30 basis points. I’m wondering how you think about that or what’s the implied within your fiscal 2024 guidance? And then you mentioned you might be willing to take incremental pricing in your next couple of menu rollouts later this fiscal year. So just wondering how you think about the connectivity between the margin and your willingness to take price?
Kevin Hochman: Yes, I think that one, we do continue to expect the year-over-year ROM number to exceed that expectations we kind of gave you from a long term factor. Obviously the first quarter impacts that nicely, but I would expect to see year-over-year gains in ROM in each of the quarters as we kind of move forward from here. Price is a factor in that, but obviously as we continue to improve our traffic scenarios. We think that will also contribute to some sales leverage as we move through. And the reason we raised guidance today was really a middle of the P&L improvement story as much as anything. The ability to sustain some of our improved economics I think is real and creedo [ph] our benefit as we kind of move through the year.
From a pricing standpoint, we’re just going to get better and more educated at how to price. We’ve actually been spending a lot of time with Deloitte Consulting, working on our revenue growth management. And a big piece of that is how do we do pricing at a more refined and restaurant level basis. And I think that’s understanding elasticities on a restaurant level basis, understanding where you have those opportunities to price and where you can be a little bit more judicious. So as opposed to approaching price from kind of spread the peanut butter across the bread, it’s going to be very granular and very tactical and I think that’s going to give us some real opportunities. So we’re cognizant of being careful on pricing as you kind of move forward, particularly depending on economic environments.
But if we see opportunities at very low elasticity to gain price in certain markets, I think we’ll take that. And we’ll just see how that plays out from a combined basis as we kind of go forward. Again, I don’t expect anything above low single digit levels. But I think that’s there for the taking and we’ll look at it closely.
Jeffrey Bernstein: Got it. And Joe, just to clarify, I know you mentioned that your guidance raise was for the most part in response to middle of the P&L success, presumably in the first quarter. Just curious because looking from the outside, looks like you raised your earnings guidance by $0.15 at the midpoint. I know this first quarter you beat the Street by $0.20 plus, but I realize the Street is irrelevant and it’s more about what you were thinking the first quarter was going to be? So I’m just wondering, how did the first quarter compare to what your initial target was? Was your fiscal 2024 increase [ph] purely the 1Q flow through? Are you assuming further upside the rest of the year versus the initial guidance? Thank you.
Joe Taylor: Yes. We probably – Jeff a great question. We had obviously a little bit more insight as to where we saw that quarter going, particularly as it progressed. So it did exceed our expectations without a doubt. I think we got more traction, faster in some of the areas on the expense items. They were all areas we were focused on and working on to get that traction. And we got to Brighton in several areas a little bit faster than we would have anticipated. But, yes, we had a higher level of belief around the quarter probably, than you all. So you’re seeing a little bit of trade-offs. And again, at this point, we’re one quarter into the year. I want to be a little cautious and again, understanding of the noise that you hear about, even though we’re not seeing it in our own numbers. Obviously, there’s a lot out there about economic conditions. So we’re going to take it one step at a time as we kind of move through the fiscal year.
