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Category: Red Robin Gourmet Burgers (RRGB)
Date: 13 January 2021 Stock price of Red Robin Gourmet Burgers: $22.72 We take a look at the business update provided by Red Robin Gourmet Burgers (RRGB) for their 2020 fiscal year. The group serves a variety of burgers and mainstream favorites to Guests of all ages in a casual, playful atmosphere. In addition to our many burger offerings, Red Robin serves a wide array of salads, appetizers, entrees, desserts, signature beverages.
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Paul J.B. Murphy III, Red Robin's President and Chief Executive Officer - During an unprecedented year due to the pandemic, we achieved a great deal, strengthening Red Robin's operational execution, business model and liquidity. Our accomplishments are now enabling us to focus on creating long-term value for all shareholders as we enter 2021 "
More About Red Robin Gourmet Burgers
Red Robin Gourmet Burgers, Inc. (www.redrobin.com), is a casual dining restaurant chain founded in 1969 that operates through its wholly-owned subsidiary, Red Robin International, Inc., and under the trade name, Red Robin Gourmet Burgers and Brews. We believe nothing brings people together like burgers and fun around our table, and no one makes moments of connection over craveable food more memorable than Red Robin. We serve a variety of burgers and mainstream favorites to Guests of all ages in a casual, playful atmosphere. In addition to our many burger offerings, Red Robin serves a wide array of salads, appetizers, entrees, desserts, signature beverages and Donatos® pizza at select locations. It's now easy to enjoy Red Robin anywhere with online ordering available for to-go, delivery and catering. There are more than 540 Red Robin restaurants across the United States and Canada, including those operating under franchise agreements
Business Update from Red Robin Gourmet Burgers
GREENWOOD VILLAGE, Colo.--(BUSINESS WIRE)--Jan. 11, 2021-- Red Robin Gourmet Burgers, Inc. (NASDAQ: RRGB) ("Red Robin" or the "Company"), a full-service restaurant chain serving an innovative selection of high-quality gourmet burgers in a family-friendly atmosphere, today provided a business update, including preliminary, unaudited comparable restaurant revenue results for the fourth quarter ended December 27, 2020.
Paul J.B. Murphy III, Red Robin's President and Chief Executive Officer, said, "During an unprecedented year due to the pandemic, we achieved a great deal, strengthening Red Robin's operational execution, business model and liquidity. Our accomplishments are now enabling us to focus on creating long-term value for all shareholders as we enter 2021."
Murphy concluded, "We began the fourth quarter with sequential improvement in comparable restaurant revenue compared to the third quarter, however, momentum stalled due to heightened dine-in and other restrictions in 43% of Company-owned restaurants including restaurants in our key states of California, Colorado, Oregon, and Washington. While the near-term is likely to remain volatile because of COVID-19, we are encouraged by recent state re-openings, and we expect indoor dining to be re-opened at 39 restaurants as of January 11th. We firmly believe Red Robin is well-positioned from both a sales and profitability standpoint when conditions normalize."
Fiscal Year 2020 Accomplishments
Despite the COVID-19 pandemic, we made significant progress on our strategic plan during fiscal year 2020 to solidify our financial longevity and develop a more robust business model. Our accomplishments this past year include the following:
Preliminary Fourth Quarter 2020 Net Comparable Restaurant Revenue Summary Compared to Fourth Quarter 2019
Balance Sheet and Liquidity
As of December 27, 2020, the Company had total debt of $170.6 million, of which $9.7 million was classified as current. Outstanding borrowings under its credit facility were $169.8 million, in addition to amounts issued under letters of credit of $8.7 million. Amounts issued under letters of credit reduce the amount available under the credit facility but are not recorded as debt.
As of December 27, 2020, the Company had approximately $128 million in liquidity, including cash on hand and available borrowing capacity under its credit facility. Due to heightened restrictions and the increase in indoor dining room closures associated with the resurgence of COVID-19, the average cash burn rate for the fourth quarter of 2020 was approximately $1.5 million per week.
Paul J.B. Murphy III, Red Robin's President and Chief Executive Officer, said, "During an unprecedented year due to the pandemic, we achieved a great deal, strengthening Red Robin's operational execution, business model and liquidity. Our accomplishments are now enabling us to focus on creating long-term value for all shareholders as we enter 2021."
Murphy concluded, "We began the fourth quarter with sequential improvement in comparable restaurant revenue compared to the third quarter, however, momentum stalled due to heightened dine-in and other restrictions in 43% of Company-owned restaurants including restaurants in our key states of California, Colorado, Oregon, and Washington. While the near-term is likely to remain volatile because of COVID-19, we are encouraged by recent state re-openings, and we expect indoor dining to be re-opened at 39 restaurants as of January 11th. We firmly believe Red Robin is well-positioned from both a sales and profitability standpoint when conditions normalize."
Fiscal Year 2020 Accomplishments
Despite the COVID-19 pandemic, we made significant progress on our strategic plan during fiscal year 2020 to solidify our financial longevity and develop a more robust business model. Our accomplishments this past year include the following:
- Significantly grew off-premise sales, which more than doubled over the prior year;
- Continued Donatos® roll-out, now in 79 restaurants, a proven growth catalyst driving approximately $45 thousand per restaurant in incremental gross margin by the second year;
- Structurally improved restaurant and enterprise level margin for the long-term compared to 2019;
- Reduced our menu by over 1/3, improving operational execution and resulting in over $2 million in annual savings;
- Implementing new management labor structure, including approximately $14 million in annual savings(1);
- Optimizing our portfolio by completing lease negotiations for more than 75% of Company-owned restaurants resulting in 3% to 4% in occupancy expense savings over remaining lease terms, as well as permanently closing select restaurants; and
- Reduced general and administrative expenses by more than 10%, or approximately $10 million.
- Reduced costs are expected to result in enterprise margin improvement of over 100 basis points during 2022, as revenues approach pre-pandemic levels, while 2021 is expected to be lower primarily due to sales deleverage related to the pandemic and other inflationary costs;
- Implemented our Total Guest Experience ("TGX") hospitality model, resulting in highest ever Guest Satisfaction Scores; and
- Increased website traffic by approximately 20%, and achieved best ever loyalty email engagement through enhanced segmentation and targeting.
Preliminary Fourth Quarter 2020 Net Comparable Restaurant Revenue Summary Compared to Fourth Quarter 2019
- Net comparable restaurant revenue decreased 28.9%, primarily resulting from our operational shift in response to COVID-19, including limited occupant capacity, operating an off-premise only model at restaurants with closed dining rooms, and closed restaurants;
- Off-premise sales increased 132% and comprised 43.9% of total food and beverage sales; and
- Restaurants with Donatos® outperformed restaurants that do not currently offer Donatos® by over 500 basis points in net comparable restaurant revenue.
Balance Sheet and Liquidity
As of December 27, 2020, the Company had total debt of $170.6 million, of which $9.7 million was classified as current. Outstanding borrowings under its credit facility were $169.8 million, in addition to amounts issued under letters of credit of $8.7 million. Amounts issued under letters of credit reduce the amount available under the credit facility but are not recorded as debt.
As of December 27, 2020, the Company had approximately $128 million in liquidity, including cash on hand and available borrowing capacity under its credit facility. Due to heightened restrictions and the increase in indoor dining room closures associated with the resurgence of COVID-19, the average cash burn rate for the fourth quarter of 2020 was approximately $1.5 million per week.
Red Robin Gourmet Burger (RRGB) stock price chart over the last 5 years
The image below shows the stock price history of Red Robin Gourmet Burgers over the last 5 years. And its not been a good time for Red Robin Gourmet Burgers stockholders with the stock decreasing by -61.7% over the last 5 years. Not the type of returns any investor would like to see.
The stock of Red Robin Gourmet Burgers (RRGB) is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Red Robin Gourmet Burgers stock is positive at this point.
The stock of Red Robin Gourmet Burgers (RRGB) is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Red Robin Gourmet Burgers stock is positive at this point.