Bob Evans Farms Inc. (NASDAQ:BOBE)
Q4 2016 Earnings Conference Call
June 14, 2016, 08:30 AM ET
Scott Taggart - VP, IR
Saed Mohseni - President and CEO
Mark Hood - Chief Administrative Officer and CFO
Brian Bittner - Oppenheimer
Michael Gallo - CLK
Steve Anderson - Maxim Group
Kim Opiatowski - Oscar Gruss
Good day, ladies and gentlemen, and welcome to the Bob Evans Farms 2016 Fourth Quarter Conference Call. At this time all participants are in a listen-only mode. [Operator Instructions]. As a reminder, this conference call is being recorded.
I would now like to turn the conference over to Scott Taggart, Vice President of Investor Relations. Sir you may begin.
Thank you, Shanon, and good morning, everyone. This is Scott Taggart, Vice President of Investor Relations. I would like to welcome you to Bob Evans Farms' fourth quarter fiscal 2016 conference call.
With me this morning are Saed Mohseni, our President and Chief Executive Officer; and Mark Hood, our Chief Administrative and Chief Financial Officer. Our call today begins with a summary of fourth quarter performance and a discussion of the fiscal 2017 outlook from Mark, and then Saed will discuss developments within each of our business segments. After that we will open the call for questions.
Please note our comments today contain forward-looking statements. These forward-looking statements include projections regarding anticipated future results. A number of risks and uncertainties could cause our actual results to differ materially from these forward-looking statements.
Our recent filings with the Securities and Exchange Commission include a discussion of these risk factors. We caution investors not to place undue reliance on forward-looking statements, which speak only as of the date of this conference call and we undertake no obligation to update these statements.
Also, we will reference non-GAAP financial measures. We have provided a reconciliation of the non-GAAP information to the most directly comparable GAAP financial measures in our earnings release posted on the Investor Relations section of our corporate website at bobevans.com and filed with the Securities and Exchange Commission on Form 8-K.
And now, here's Mark Hood with a review of the quarter's results and a look ahead at fiscal 2017. Mark?
Thanks, Scott, and good morning, everyone. We appreciate you joining us for today's update. Before discussing fourth quarter and fiscal 2016 results, as well as our outlook for fiscal 2017, I will take a moment to review corporate level fourth quarter activity.
We continued making progress on cost reduction initiatives at all levels of the organization as we have eliminated approximately 30 million of annual costs since the inception of our three-year $35 million cost savings program announced in March 2015.
During the quarter, we also completed our previously announced real estate monetization initiatives with completion of $197 million sale leased-back transaction of 143 restaurant properties. Along with the 52 million sale leaseback of two BEF food production facilities earlier in the year, these transactions have helped support nearly 500 million of capital returned to shareholders through share repurchases and dividends during the last three years.
Turning to a review of consolidated fiscal 2016 fourth quarter results; we reported fourth quarter consolidated net sales of 345.6 million, a 4% or a 13.2 million increase compared to last year. Consolidated GAAP net income was 0.6 million or $0.03 per diluted share compared with net income of 5.6 million or $0.24 per diluted share in the fourth quarter of last year.
Non-GAAP net income for the quarter was 9.5 million or $0.48 per diluted share compared to non-GAAP net income of 13.2 million or $0.56 per diluted share in the prior year period.
During the fourth quarter, the company incurred costs of approximately 15.5 million that it excluded from GAAP results as it believes this exclusion provides a better understanding of ongoing results of operations. These transactions are primarily related to costs arising from the sale leaseback transaction and restaurant closures partially offset by a reduction in litigation reserves resulting from a final settlement of our wage in hour matters. These items are detailed in the factsheet accompanying our release.
For full year fiscal 2016 included a 53rd week. Consolidated GAAP operating income was 36.2 million compared to 17.7 million last year. Consolidated non-GAAP operating income was 66.2 million compared to 53.5 million last year, a 24% improvement. Consolidated GAAP net income was of 24.2 million or $1.13 per diluted share, compared with net income of 16.6 million or $0.70 per diluted share last year.
On a non-GAAP basis, net income was 43.4 million or $2.02 per diluted share, a 24% increase compared with $1.63 per diluted share of last year. The 53rd week increased fiscal year ’16 and Q4 fully diluted EPS by $0.13 per share. Excluding this, non-GAAP EPS for fiscal year 2016 w-as $1.89 per share, an increase of 16% from fiscal year 2015. Our cash balance and revolver borrowings at the end of the fourth quarter were 12.9 million and 339.1 million respectively.
The restaurant sale leaseback transaction generated an estimated $22 million tax liability that will be paid in the first quarter. We were in compliance with our debt covenants, and our adjusted leverage ratio as defined in the company’s credit agreement was 2.44 times at the end of the quarter.
On a pro forma basis, assuming the 2016 sale leaseback transactions occurred at the beginning of the fiscal year, the company’s year-end leverage ratio would have been 3.19 compared to 3.37 in the prior year.
Fourth quarter capital expenditures totaled 17 million, bringing year-to-date CapEx to 65.7 million. Significant investments during fiscal year 2016 were related to the continued implementation of our new Enterprise Resource Planning system or ERP, Retail Technology Platform or POS, and other IT investments. Maintenance CapEx at both Bob Evans Restaurants and BEF Foods, and the expansion at BEF Foods Lima, Ohio refrigerated side dish facility.
The company recorded a GAAP tax benefit of 5.1 million for the fourth quarter, as compared to a tax benefit of 7.1 million last year. The effective income tax rate in the fourth quarter of fiscal 2016 was different than the statutory rate due to the company’s increased domestic production activities deduction as a result of increased taxable income and the utilization of tax credits.
The non-GAAP tax rate was approximately 13.8% for the fourth quarter compared to 11.2% last year in the fourth quarter. The increase in the tax rate reduced fourth quarter diluted non-GAAP earnings per share by approximately $0.01. For the fiscal year, the non-GAAP tax rate was 22.4% compared to 10.5% for fiscal 2015. The increase in the tax rate reduced fiscal 2016 diluted non-GAAP earnings per share by approximately $0.30.
Turning now to Bob Evans Restaurants; Bob Evans Restaurants’ fourth quarter net sales excluding the 53rd week were 226.5 million, a decline of 11.7 million or a 4.9% compared to net sales of 238.2 million last year. Same store sales declined 3% with the balance of the net sales decline due to net restaurant closures earlier in the year.
Same store breakfast daypart sales remained positive during the quarter, reflecting the ongoing positive impact of our best-in-class breakfast initiatives and on-premise sales comprised 16% of total sales. 21 underperforming restaurants were closed and no new restaurants opened during the fourth quarter. At the end of fiscal 2016, the company operated 527 restaurants.
As previously announced, we expect to close six additional leased restaurants during fiscal 2017. Furthermore, one of our restaurants in Maryland was destroyed by a fire early in the first quarter of fiscal 2017. We plan to rebuild that location and reopen in fiscal 2018. Bob Evans Restaurants’ non-GAAP operating income was 11.6 million compared to 16.7 million last year, a decline of 5.1 million.
The decline was due to lower sales and to increased investment in labor hours to support efforts to improve guest hospitality along with increased hourly wage rates as a result of minimum wage increases, partially offset by cost savings of 2.8 million. Operating income of 2.3 million was attributable to the 53rd week of fiscal 2016.
At Bob Evans Foods, net sales excluding the 53rd week of fiscal 2016 were 95.3 million, an increase of 1.1 million or 1.1% compared to 94.2 million last year. Overall, external pounds sold increased 7.1%, while the average net selling price per pound declined 5.5% compared to last year. The decline in average net selling price reflects an increased sales mix of lower priced side dish products relative to sausage as well as reduced net sausage pricing.
From a growth sales perspective, a 6.5 million increase in side dish sales was partially offset by a 1.2 million decrease in frozen and other retail products, a 0.4 million decrease in food service sales and a $4 million increase in trade spending, which reduces net sales. Sausage sales were approximately flat.
As planned, our sales mix continues to shift towards higher margin retail products, driven by side dishes. However, we continue to use food service sales value selectively to leverage plant operating efficiencies. The 13.7% increase in side dish pound sold and a 0.6% increase in sausage pound sold supported market share growth in both product categories.
BEF’s leading national market share in the refrigerated dinner sides increased to 51.5% from 48.5% last year, and national breakfast sausage share was flat at 9.1%. In our core sausage markets where we spend the bulk of our trade dollars to maintain and selectively grow our number one sausage share, our share increased 20 basis points to 27.6%.
BEF Foods’ non-GAAP operating income was 20.6 million compared to 18.2 million last year, an improvement of 2.4 million. The improvement was due primarily to increase sales, favorable sales mix and 0.7 million of cost savings partially offset by 3.9 million of increased net sale cost, 4 million of increased trade spending partially offset by 0.1 million of sow cost favorability, and increased incentive in stock based compensation. Operating income of 2.1 million was attributable to the 53rd week of fiscal 2016.
During fiscal 2016, we invested in project company-wide to enable and support future profitable growth. These projects included continued implementation of our ERP system, along with development and testing of our restaurant technology platform including a new point of sale system that we will begin rolling out to our restaurants later this summer, with implementation expected to be complete by year end.
Although we will continuously update and refine our ERP system, 2017 is a final year of implementation with execution of four major components that are expected to drive, continue the efficiency gains at BEF Foods and clothing trade spending management, order management, transportation and accounts receivable modules.
As per the 2017 outlook, we expect to achieve fiscal 2017 consolidated net sales of 1.28 to 1.33 billion and diluted non-GAAP earnings per share of $2 to $2.15 per share which represents a 10% increase at the midpoint compared to fiscal 2016 52 week non-GAAP diluted earnings per share of $1.89.
On a GAAP basis, our fiscal 2017 EPS range is $1.95 to $2.12 reflecting 1.5 to (inaudible) million of pre-tax charges related to lease terminations, holding and other costs associated with a closure of 27 restaurants announced in April.
At Bob Evans restaurant, we expect negative low single digit to flat same store sales for fiscal year 2017. However, we expect to achieve flat positive low single digit same store sales during the second half of fiscal 2017, as we benefit from the increased focus on hospitality and guest satisfaction initiatives as Saed will discuss along with the introduction of a redesigned menu in August and increase consumer awareness of brand improvement that will be highlighted in our advertising campaigns throughout the fiscal year.
We expect commodity cost to be approximately flat to last year, as the commodity environment remains benign. Our guidance also incorporates incremental investments and labor hours in marketing, particularly during the first half of the year to support our efforts in improving guest hospitality and to better communicate our value offerings at everyday part.
Additionally, we expect an approximately 3 million net P&L investment to rollout our new POS platform in fiscal 2017, a cost of $0.10 per share. At BEF Foods, we expect net sales of 400 million to 420 million in fiscal 2017 with our refrigerated side dish product line generating most of the growth.
We expect sow cost of $52 to $55 per hundredweight throughout fiscal 2017 in line with a 10 year average and current forecast of industry experts. We also anticipate incremental marketing expense to support continued volume growth particularly of our refrigerated side dishes. Additionally, there will be some labor inefficiencies as we build staffing for production startup of line four at our refrigerated side dish facility.
Our fiscal 2017 capital expenditure budget of 75 million to 80 million is comprised of the following: approximately 20 million for the restaurant technology platform, 12 million for the expansion of BEF Foods refrigerated side dish facility, and 35 million for maintenance and equipment upgrades at both Bob Evans Restaurants and BEF Foods, with the balance budgeted for IT expenditures and infrastructure, and opening of one new Bob Evans Restaurant.
We expect a net cost impact of the 2016 plant and restaurant sale leaseback transactions to be approximately 3 million during fiscal 2017 reflecting GAAP rent expense of 15 million, partially offset by decreased depreciation of 12 million. Overall, we project total enterprise rent expense of approximately 22 million during fiscal 2017.
We have $78.5 million remaining on our share repurchase authorization and expect to execute additional repurchases during fiscal 2017 while maintaining and prudent leverage ratio. However, our diluted non-GAAP EPS guidance of $2 to $2.15 assumes average shares of 20 million which does not reflect the impact of potential repurchase activity.
The estimated full year EPS impact of repurchasing 1 million shares would be approximately $0.07 per share assuming yesterday’s closing price and our year-end ’16 interest rate of 2.44%. Finally, we anticipate a tax rate of approximately 24% to 25% during fiscal 2017, a $0.05 to $0.06 impact from the tax rate increase versus fiscal year ’16.
With that I will turn the call over to Saed to discuss BEF Foods and Bob Evans Restaurant strategies for fiscal 2017. Saed?
Thank you Mark, and good morning everyone. At Bob Evans Farm, our mission state we are committed to providing high quality of food with hospitality and integrity, whether in our restaurant or in our retailers. We made progress to a consistent delivering of this promise at both Bob Evans Food and Bob Evans Restaurant during the fourth quarter.
At Bob Evans Food, our refrigerated side dish facility expansion is nearly completed and we expect to bring in new capacity on line later this summer. The additional production line, the $20 million capital commitment expands our ability to meet peak holiday demand for greater number of customers.
Furthermore, as a result of the expansion Bob Evans Food will have the capacity necessary to expand its SKU count with existing retailers, enter new markets with acquired new customers, deepen its supply relationship with Bob Evans Restaurant and selectively target profitable food service and private label business to optimize non-peak [time] utilization.
Our view on Bob Evans Food is that the recent strong results are not an exception, rather than going forward it is our expectation. Of course, there will be some volatility in results overtime, but we are comfortable with the normalized Bob Evans Food segment operating margin [guidance] in the range of 15% to 18% that we disclosed during fiscal 2016.
We have the talent, product quality and confidence to continue growing as retailers nationwide after several years’ reorganization. At Bob Evans Restaurant, same store sales at breakfast day part remained positive; reinforcing our conviction that enhancing guest experience through improved hospitality and upgrade food quality are the two essential drivers for returning our restaurants to consistent positive same store sales growth.
We are now expanding the element of our best-in-class breakfast initiative to lunch and dinner day part, where we expect to launch product upgrades later this summer. Every restaurant general manager, regional leader and the Vice President participated in regional meetings earlier this quarter, where the focus was on enhancing the guest experience through improved hospitality and operational execution.
We have incredible restaurant management team and now have the permission and the training to act like the owner rather than a manager. Following the regions’ meeting, our general managers have returned to the restaurant with their new processes, it is simply this, when dealing with guest request; the answer is yes, what is the question.
We are also investing in additional labor hour between 10 AM and 2 PM on weekends, our busiest period of the week to increase table turn, reduce guest wait time, increase sales and improve guest experience. Our goal is to create highly satisfied guest experience that every guest every time they visit. We know that highly satisfied guests are more likely to recommend and return to our restaurant than guests who are just simply satisfied.
The commonality between these fourth quarter development at Bob Evans Food and Bob Evans Restaurant is that each business made fundamental investments and development initiative that are essential to further sales and profit growth.
As I said in last night’s earnings release, our focus in fiscal 2017 is to profitability grow both Bob Evans Food and Bob Evans Restaurant, while continuing to improve efficiency at all levels of our company, from the restaurant, the plant level and the home orders. More specifically, our priorities are Bob Evans Food for fiscal 2017 are as follows: grow our side dish market, share nationwide, expand our sausage business in our core market, add significant volume to leverage recent investment in our side dish facility in Lima, Ohio, as well as pre-cooked product in our Texas plant. Implement the final component of our ERP system that Mark mentioned earlier, and laid the foundation through continued growth in to fiscal 2018 and beyond.
These priorities are not new; we are committed to disciplined execution of our growth strategy at Bob Evans Food. However, as we progress through the transformation of the business, we find ourselves in better position to consider new opportunity, as we lay the foundation for continued growth in years ahead, not only to leverage our recent capacity and efficiency investment, but to expand reach and awareness of Bob Evans plant in the grocery channels.
We see multi-year brand growth opportunity at Bob Evans Food. For example, we recently signed a five-year agreement with global [brand] licensing agency that specializes in collaborating with companies to extend brand in to new product categories. We are just beginning work in this area and it’s too early to quantify potential P&L impact or disclose product categories under consideration. But we believe, Bob Evans planned equity lends itself to presence in other areas.
At Bob Evans Restaurant, our objective for fiscal 2017 is to restore brand relevance through four key initiatives; the configuration of our menu and price value equation, selecting the food quality upgrade, marketing that emphasizes value at everyday part and most importantly, restoring of hospitality as a differentiator of Bob Evans Restaurant.
We are currently working on food quality upgrade across all dayparts that are critical. However, ultimately not food, not discounts, not even our menu will consistently differentiate us in a meaningful way over the long term.
At the end of the day, these items are table [state] and not substantially differentiated for increasing shares in family dining segment. Family dining is a business where hospitality and connection matters to the guest. Hospitality ensures that the efforts in other to improve the guest experience do not go unrewarded. This is why we’re spending a significant amount of time working with the restaurant team to install our guest philosophy of; the answer is yes, what is the question, at each of our restaurants.
It is also why our current television ad focuses on our guest hospitality and the company heritage, as much as it does the value message of breakfast available all day starting at 4.99. In addition to offering more hospitable guest experience during fiscal 2017 and beyond, we are focused on continually improve our core menu items and improve Bob Evans Restaurant value perception to redesign menu to be launched later in August, supported by a lion marketing message, the menu as well as our marketing would better reflect the simplicity, value and integrity for which Bob Evans’ known.
In the interim, with our main menu launch we introduce our summer bacon promotion with special bacon theme items at every daypart including a bacon lovers’ omelet, a bacon cheese burger, strawberry bacon salad, and one of my favorite, a three course bacon top chicken dinner.
We’ve also reduced a number of seasonal menu change to five from seven annually. This reduction would not only reduce cost, enable our culinary marketing and operational teams to better develop, promote and execute each seasonal offering.
On the marketing front, our message will be balanced across both traditional and digital platform. We will remain anchored in value and hospitality, two areas our guest research has revealed has an opportunity for us. Our culinary marketing and operational team are working together to ensure the promise of our advertising message is in line with the guest experience.
In closing, I would like to thank the team at Bob Evans Food, Bob Evans Restaurant and here at our home office for the progress made during the fiscal 2016. Bob Evans team members should be proud of what has been achieved in a short period of time. However, much remains to be accomplished in fiscal 2017, as we continue working on realization of our growth potential of both of our businesses.
We come to work each day thinking how we can improve and create more highly satisfied guests and customers at every meal, whether in our restaurant or around the dinner table at home. I also like to thank our investors for their ongoing trust. We remain focused on evaluating all options for increasing shareholders’ value.
I thank you for your interest in Bob Evans Farm and we look forward to a continued open dialog with you. We welcome your question in this call.
I will now turn the call back to the operator for the Q&A. Operator would you please open the lines for questions?
[Operator Instructions] our first question is from Brian Bittner with Oppenheimer. You may begin.
You said that you expect flat to positive comps in the second half and that’s what’s baked into the 2017 outlook. So, then just to be clear, what type of comps are you expecting in the first half, just so that all of us publishing analysts here are on the same page. You’re doing negative 3% or slightly below that on average for the second half of ’16, is that a type of trend you’re still seeing and expecting to see in the first half? Just a little more color on first half since you gave us color on second half.
Sure Brian, its Mark. I think first of all, I’d say that May came in at negative 3%, which was in line with fourth quarter’s actual and a slight improvement from April. However, as you saw in our fourth quarter results, the monthly results have shown a fair amount of volatility recently. Month of June is off to a slower start than the month of May, so again as we said in our guidance, we expect probably low-single-digit negatives in the first quarter.
What is it about the new menu and marketing that really gives you the confidence to bake positive comps into the model at this point?
This is Saed. I think the research that we’ve done with our consumer, two things have been very apparent. One is that our value proposition has not been communicated more effectively in the past. Second, so many initiatives we have done that we’ve compromised the hospitality side of our business.
Over the last four months, we’ve focused on both of those fronts. We have rolled out breakfast for 4.99, and we have also substantially increased our hospitality effort, and that effort has paid off. Our guest comments have improved substantially, our negative guest comments have reduced double-digit, and our goal is, as we continue go throughout the year; improve that guest experience at the restaurants.
At the same time, we recognize that we’re putting out a goal for the end of the year to turn positive. We believe providing high quality food, focusing on the value proposition would enable us to achieve that goal in the latter part of the year, but as Mark pointed out, clearly the first quarter has started on a negative side worse than the Q4 ended.
And then just lastly, why is the higher interest expense baked into the outlook for ’17 versus ’16 when you just reduced your debt pretty significantly?
Two items there Brian, I think first of all, we’ll have a full-year impact of the mortgage which has a higher interest rate than the credit facility. We’re also conservative and cautious in our expectation for interest rate, rate rises by the fed.
Our next question comes from Michael Gallo with CLK. You may begin.
I just wanted to drill in on the labor comments. I think if I go back a year or so ago, you were cutting a lot of labor hours out of the store. It seems that you’re now putting them up, putting some of them back. So, I was wondering if you can give us some more color on where are you putting the labor hours back, why that wouldn’t be just an ongoing expense. I know you talked about improving hospitality in the front half, but if you can just sort of parse out why that wouldn’t be ongoing than in the second half? Thanks.
Sure. In some cases, the labor will be ongoing on the front of the house. We have made a commitment to provide better table ratio server during our peak hours on a weekend breakfast and for Saturday and Sunday. At the same time, we are finding some efficiencies on the back of the house which we hope to optimize on that on the backend of the year. But our commitment is to make sure that first and foremost we provide the level of hospitality that our guests have come to expect from Bob Evans, and I believe that labor costs that might have taken place have contributed to the decline in our comp sales.
And then just a follow-up question on dinner, obviously you’ve seen 7%ish negative comps for dinner for the last year, even off-premise in the dinner which you had gotten some boost with the [Brewster] launch, it seems to be pretty weak now. So help me with how the new menu is going to better address dinner which has obviously been an area that Bob Evans has had trouble for some time? Thanks.
Sure. I think at dinner, our goal is to provide a more favorable items that you will find in our heritage of Bob Evans, at the same time, reinforcing the value proposition in our restaurant. What’s interesting is that while the average check for dinner for Bob Evans is relatively low, the consumers’ perception is that we are expensive restaurant at dinner part. So our goal is to reinforce that not only with the new menu but also with a new offering that our culinary team are working on right now.
If I had to add to that Mike, in the prior year the buy one, get one free offers were more prevalent at the dinner daypart particularly on the weekends, and so as we’ve overlapped that that’s been the biggest pain point, and additionally the bundled offerings that perhaps changed customer perception of value was another item that we’re trying to address in the menu redo.
The center of the area that’s going to get more labor hours or more of that at breakfast or lunch or is it pretty evenly spread at front of the house.
The labor investment is currently made in our peak hours at breakfast time. That is clearly our core competency. We believe we have the right ratio of labor at dinner time. Our focus is really enhancing the quality, the core ingredients of our dinner business, as well as the range in pricing for dinner. Otherwise the labor we feel we have a sufficient amount of labor at dinner time.
[Operator Instructions] our next question comes from Steve Anderson with Maxim Group. You may begin.
And if its indeed your indeed to maintain the BEF Foods within the corporate structure, what are you doing to enhance and improve any existing efficiencies between Bob Evans Restaurants and BEF Foods?
Obviously our intention is to make sure that we continue to evaluate all our options for Bob Evans organization, while mean time, Bob Evans Food has obviously have had incredible year in 2016 and we expect that that success continue going forward. At the same time, Bob Evans Food is producing our current mashed potatoes that we serve in our restaurant, 6% of our sales at Bob Evans Food is coming from Bob Evans Restaurant and our goal is to continue to find ways that we can have some of our core items been made by Bob Evans Food. But clearly Bob Evans Food will have the ability, the capacity to continue to focus on the side dishes that happens to be the most profitable segment of our business.
Now switching to the restaurant, I know on the previous call you had mentioned that you’re looking to rollout the selected new menus back in May, but what led you to look at delaying that release until August?
Initially it’s set in the summer time, so August is within that timeline, and we’ve done much more extensive consumer research to make sure that the new day of the menu and new offering does not impact the average check in any way or shape and form negatively, and also wanted to make sure that we fine tune our culinary offering. But I believe we’re still very much in line with the timeline that we laid out earlier in the year been in the summer time.
We did also Steve rollout a new edition of the current menu in late May that better highlights value price points at each daypart. But call it complete menu redesign is the August launch.
Our next question comes from Kim Opiatowski with Oscar Gruss. You may begin.
One question was with regards to the new plant rollout that are focused on the side dishes. Can you give us; refresh our memories about margins on side dishes and kind of what [state] didn’t choose your guidance with regards the growth in that segment going forward.
Sure Kim, its Mark. In terms of growth rate on the side dishes, I believe we said that that was running about 7% was our expectation for ’17. The margins on our side dish products are significantly greater than the margins on sausage. In the past we’ve said its more than a 10 point spread.
[Operator Instructions] And I’m showing no further questions at this time. I’d like to turn the call back over Saed Mohseni for closing remarks.
Thank you. Thank you everyone for joining us today. If you have additional questions, please do not hesitate to call us. If we don’t hear from you in the meantime visit a Bob Evans Restaurant sometimes soon to enjoy our hospitality and excellent meal with breakfast starting at 4.99, or stop buy at your local grocery store and pick up the package of Bob Evans Farm fresh mashed potatoes or macaroni cheese. You’d be glad you did.
We look forward to share our fiscal 2017 first quarter result with you in a few months. Thank you and have a pleasant day.
Ladies and gentlemen this concludes today’s conference. Thanks for your participation and have a wonderful day.
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