Mark Smith: Perfect. I think the last one for me, and I apologize that I missed some of this. Of the, I think it’s, eight to 11 new restaurants expected this year, can you just go through kind of the breakdown of those again? And then, any expectations on kind of near-term Q2, which of those openings maybe happen over the next couple of months?
Tyler Loy: Sure, Mark. This is Tyler. So, it’s going to be one company-owned RA; it is one to two company-owned Benihana locations; one Salt Water Social in Denver; one to two Kona Grill; and then three to four STKs.
Manny Hilario: And the next one coming out the chute is going to be STK in Aventura, Florida. So that will be the next opening that we have. And then thereafter, we have Salt Water Social, and we have RA and we have a Kona Grill, all bunching in around the middle of the third quarter in terms of opening. And then, the rest is towards the end of third quarter, early fourth quarter.
Tyler Loy: And sorry, Mark, that was [indiscernible] two to three Kona Grill.
Manny Hilario: Yeah, two to three Kona Grill.
Mark Smith: Two to three, not one to two. Okay. Thank you.
Operator: Thank you. Your next question comes from Michael Symington, Wedbush. Michael, please go ahead.
Michael Symington: Hi. This is actually Michael on for Nick at Wedbush. Two for us, I guess, maybe just a modeling question to start. Could you provide the comp breakdown in Q1 for both STK and Kona?
Tyler Loy: Yeah. Give me one second. It was minus 6.8% for STK, Michael, and minus 9.7% for Kona Grill.
Manny Hilario: And then, traffic…
Michael Symington: Sorry, in terms of traffic and pricing embedded in that?
Tyler Loy: Yeah, I’ve got it. So, checks down at STK minus 4% and then average check was minus 2.5% and pricing in that average check was 4%. And then, for Kona Grill, traffic, minus 14%. Pricing — our average check was plus 4.5%, with pricing up 7% in there.
Michael Symington: Great. Thanks. And then, you guys have talked about targeting 17% margins at Kona. Just wondering if you could provide an update on the margin profile you’re seeing at the new units and how that really compares to the older legacy units that you talked about needing to potentially look at a little bit of work on.
Manny Hilario: I mean the prototype ones have done really well, the new ones. And the reason is I think labor has been better. I mean I’ll just preface that by saying that they’re still early on their life cycle. So their profitability will be improving there as well. But I would say the new stores have been on how we expected on the margin. I would say, in general, the Kona Grill brand, we do have core restaurants, which we kind of refer to, from the acquisition around 18 of the restaurants, have an average margin of about 13% plus. And then, we have about six Konas in there that. Frankly, the real estate is not what we would do today. So I think really, the margin fix with Kona Grill is to continue opening those new restaurants.
I think the core ones are still in solid margins for the casual sector. And then we got to work out the plan for these other six restaurants and get them to a better place. So that’s really how we’re targeting that. But I’m pretty pleased with the progress on the new restaurants on the margin side.
Michael Symington: Great. Thanks very much. I’ll hop back in the queue.
Operator: Thank you. Your next question comes from Roger Lipton, Lipton Financial. Roger, please go ahead.
Roger Lipton: Yes. Hi, Manny. Hi, Tyler. Congratulations on getting the deal completed so quickly. It seems like about five weeks from announcement to closing. So, the lawyers must have been busy. A couple of questions. It sounds like the synergies from the — combining the companies is going to be in place pretty quickly. Can you give us some idea of where that’s coming from? That run rate sounded like, by the end of this year, it will be pretty much in place. So that’s the first question. Second question is, what does the current balance sheet look like post the closing in terms of cash and long-term debt?
Manny Hilario: Yeah. I mean, so I think the synergies, a lot of the initial ones which we are already working on our supply chain. So, I think that’s going to be a really good area of synergies for us. We’ve already started looking at beef and integrating our supply chain because we have a lot of purchasing power on that side. And I think that’s going to be significant for us. I think there’s also some other efficiencies with rebates and some of the stuff in supply chain. So that will be level one, they’ll be relatively enacted quickly. I think the outlook on just the operations, I think there’s a lot of things that we can do in terms of — for instance, we have a call center. I also think that we can have labor efficiency at the restaurants when we bring in our services to the call center. So that’s looking pretty good.
Tyler Loy: And then, Roger, in terms of the balance sheet, in the previous IR presentation, we had said a little north of $50 million there on the balance sheet. And then, debt after the transaction is going to be about $350 million. So, net debt, we anticipate to be around $300 million or so.
Roger Lipton: Okay. All right. Very good. Thanks very much. Go ahead.
