Tony Hull: Yes, I mean we, Fred, we’re really excited about the trajectory of the Burger King brand based on what we’ve heard and what we’ve spoken to those folks about in our meetings with them. And then, for our investors, it’s going to be a huge positive we think because we’re going to obviously participate in that in a big way and that improvement. So I think the most important thing is they’re just not talking, they’re actually doing on these things. So I think the discounting was huge in 2022 and because they were clearly a high discounter during COVID and before, and the fact they’ve gotten that down 500 basis points in the fourth quarter is tremendous for our bottom line. So €“ and the fact that they’ve hit €“ they’ve talked about targets that obviously our investors would be very happy, we’ll be very happy when we had 175,000 good target that they put out for us next year.
And we’re excited that their actions are aligned with ours because they’ve made that public commitment and the actions they’re taking are to support that, our ability to get to that number. So whether it’s them paying for the incremental marketing over the next couple years to them helping us with remodels on subsidies basis to they’re not going to do something to drive traffic that reverses some of the progress they’ve made because if they do that, that could if for instance, they went back to €“ if they increased discounting that would obviously make it more challenging for us to or for the system to hit that 175,000 per store. So we’re very aligned on how we €“ what the target is and what the good guys and the bad guys are to get to that target, so they know to stay away from the bad guys on that and to focus on the good guys.
Fred Wightman: Makes sense. And I guess just following up on the customer satisfaction metrics that you guys gave across the two brands, nice to see them both positive but also sort of a big disconnect between Burger King and Popeyes. I’m wondering when you look at that Popeyes number, what the biggest laggard is it speed of service? Is it something else? Anything else that you guys sort of things could be corrected and maybe close that gap?
Tony Hull: I mean, the improvement was better for Burger King than for Popeyes. That’s the number we talked about. But having said that, it’s €“ we are the team, the Popeyes team is working really hard to improve their customer satisfaction scores. They had some labor challenges that were probably more dramatic during post COVID 2021. So their operating hours are growing faster as you saw in the numbers that we gave in the script. So I don’t know, Joe, if there’s anything else, but it’s a huge focus for them to get neck and neck with our Burger King numbers.
Joe Hoffman: Yes, there’s no doubt. There’s a real focus on that. And I think that as we continue to drive it, the €“ where we saw the most improvement was accuracy. So we’ll continue to drive that as we move forward.
Fred Wightman: Perfect. Thank you so much.
Tony Hull: Thanks, Fred.
Operator: Thank you. Our next question is from the line of Joseph Farricielli with Cantor Fitzgerald. Please go ahead.
Joseph Farricielli: Good morning. Two questions. Can you give me €“ can you give us some guidance on the cadence of CapEx over the course of the year? And then my second question will be on the pricing we could discuss the CapEx first.
Tony Hull: Sure. Sure. So the $40 million CapEx is going to be back half weighted just because we’re just gearing up on a lot of the remodeling effort. I mean, obviously, the maintenance piece of it is pretty constant throughout the year, but the growth piece of CapEx, the remodeling piece of CapEx will increase as the year progresses. So it’ll start out slow and then get some higher numbers in the back half of the year.
Joseph Farricielli: And is that the gross or the net number because at least as it relates to Burger King, they do subsidize a portion. So
Tony Hull: Yes. That’s a net number.
Joseph Farricielli: Okay. And how do we see that roll through your cash flow statement? Do you spend it and then get reimbursed a quarter later? How do we think of it from a cash flow perspective?
Tony Hull: I would say that that is not completely locked down yet, but worst case scenario, it’ll be a month or so after the remodel is completed. But our goal is to make sure we get all the subsidy money in against the spend in 2023 to get to that $40 million net number.
Joseph Farricielli: And it is a reimbursement, not an offset to another fee or something I guess maybe that’s what I was trying to.
Tony Hull: No, they are reimbursements.
Joseph Farricielli: Yes. Okay. Okay. And then the next question, during your prepared remarks, I’m trying to go through my notes. You made a comment about I think it was 20% of the Burger King’s €“ you’re changing your pricing or doing less discounting, how do you do that geographically without having the customer pick up that if I go to the one on the East side of town versus the West side of town, or vice versa like, how do you keep them from picking up on these price changes?
