Operator: Thank you. Our next question comes from Danilo Gargiulo. Please go ahead.
Danilo Gargiulo: Hi, I would like to continue again on the topic of franchisees. Specifically, Kirk, in your roundtables with franchisees, what is the one area of excitement that you heard most consistently? And what is the one area of opportunity that they’re asking of you?
Kirk Tanner: Great question and good morning. Yes, number 1 excitement is building the daypart of breakfast. This gives a lot back to the franchisees. We’ve talked about it in the past. It allows us to build out and use the restaurant, use the labor model and build out a profitable daypart that where we have still a lot of potential for. So we’ve got a lot of system excitement around building that daypart that allows us to grow faster and grow our profits. The big conversation that we’re having with our franchisees is driving restaurant level profitability. I think that, again, that’s a good part of this flywheel that we want to create. So if we can expand margins by operating more efficiently, driving levels of productivity, those are meaningful partnerships that we are working on with our franchisees, and that’s something that we’re both in the boat together rowing on, because we feel like that will generate a lot of momentum for our future.
Operator: Thank you. Our next question comes from Alex Slagle from Jefferies. Please go ahead.
Alexander Slagle: Hey, thanks and good morning. I realized we’re only four months into the year, but with the 3% to 4% comp guidance and the underlying assumption that QSR burger traffic would be slightly positive, which I don’t have hard data on, but no, it’s been a soft start. Indications seem to suggest a negative 1Q, maybe negative trend for the year, but just kind of curious if this has an impact on your outlook at this point or I guess the incremental offsets you envision and the flexibility, I know the investments give you a lot of positive optimism, but thoughts there.
Gunther Plosch: Good morning, Alex. Yes, we are very comfortable with our unchanged global SRS outlook of 3% to 4%. As you have heard from the prepared remarks both in the U.S., in international and global, we accelerated versus quarter four on a two year basis, our two year stack in the first quarter was 8.9%. If you take our guidance into consideration, you will find that for the rest of the year our two year stack is about in line with the first quarter. From a programming point of view, we feel really good. While we started to spend money on breakfast in the second half of the quarter and achieved already high-single-digit sales growth that will accelerate as we’re spending more money on it. Also from a programming point of view for rest of day, while we have great focus on core, we are spending a good amount of money on digital.
We have more innovation coming out on Frosty’s, more innovation coming out on our chicken lineup. So all of that we think there is a good level of momentum, especially since we increased traffic every single month of the quarter. So comfortable with the outlook, like the marketing plan for the year to go and guidance is realistic.
Operator: Thank you. Our next question comes from Eric Gonzalez from KeyBanc Capital Markets. Please go ahead.
Eric Gonzalez: Hi, good morning and thanks for the question. Maybe if you could speak a little bit more about dayparts. You have the high-single-digit growth at breakfast, which I suspect is well above the industry’s growth rate, but perhaps expected given the investment. So first, how much of your incremental investment did you deploy in the first quarter? That’s the first part. And then the second part is presumably with the low-single-digit comp growth in the U.S., it appears that the other dayparts are underperforming the industry. So perhaps you could comment on how the lunch dinner dayparts fared in the quarter and maybe what are some of the growth drivers in place to reaccelerate those trends? Thanks.
Kirk Tanner: Good morning, Eric and thanks for the question. On breakfast, let me start with that one. We really only spent about $2.5 million because we activated late in March for breakfast. So we saw that performance, and we just started the investment. And maybe the question is why did you wait that long? I think that it was really important for us to get systemwide alignment with our franchisees. We’ve added a couple of menu items like Breakfast Burrito and Cinnabon Pull-Apart. So we wanted to get that lined up and then we started to spend the money so that we had great activation in the restaurant. So we see that momentum continuing. So just really one quarter of investment — or one month of investment and you’ve got a lot to look forward to on the breakfast side.
We also saw momentum on the evening daypart. That continues, the late night daypart has been successful for us. We saw a lot of momentum in that regard. So we see that continuing and our menu sets up for that as well. Overall, we held share across the dayparts. I think that’s important in that there’s still opportunities for us to accelerate, but we’re in a competitive position right now where we held share across traffic and dollar across all those dayparts.
Operator: Thank you. Our next question comes from Jim Salera from Stephens, Inc. Please go ahead.
Unidentified Analyst: Hi, this is Tyler on for Jim. Thanks for taking the question. I was going to see if we can get an update on consumer and how they might be interacting with your brand by income cohort or daypart?
Gunther Plosch: Good morning. Yes. So income cohort, couple of messages. I would say definitely the consumer is still under pressure. We’re seeing this despite that we obviously performed well. We maintained share on the traffic on dollar side. We are splitting income cohorts in income households below $75,000. They are definitely under pressure. They are reducing frequency and so visitation is down. We’re maintaining share with that cohort. On the other side, we are — there’s more traffic and more frequency on the higher income consumer, we are again maintaining share with that income cohort. So it’s not a new trend, it’s a trend we have seen in quarter four that we’ve seen continuing in quarter one. As we are looking at the category outlook, we think it will accelerate for you to go. So there will be a little bit of tailwind that’s also kind of shared, that view is also shared together with our research agency that we use.
Operator: Thank you. Our next question comes from Dennis Geiger from UBS. Please go ahead.
