BurgerFi International, Inc. (NASDAQ:BFI) Q4 2022 Earnings Call Transcript

Ian Baines: And they continue to open new locations and look for further locations. So the interest remains very, very strong. And our relationship with our franchisees is very strong. In fact, we have franchise summit coming up later in April, which is the first 1 we’ve had for a couple of years given COVID and what have you. So we’re looking forward to spending time with them and as we always do, sharing best practices amongst our franchisees and our corporate locations.

Unidentified Analyst: I certainly appreciate that. And then maybe 1 or 2 more on my end. In terms of the franchise Anthony’s openings that you expect for this year, I believe you mentioned 2 or 3. Could you give us a little bit more detail on the potential timing of those openings and the location, what part of the country those openings are planned for?

Ian Baines: Yes. The first 1 is in Kissimmee, Florida, and I expect that to be by June of this year. So that’s — that one. Then the other one also is here in Southern Florida, actually in Miami more likely to be in the fourth quarter.

Unidentified Analyst: Certainly. And then the last one for me, maybe one for Mike. Just on the guidance for ’23, is there a particular or specific restaurant level margin outlook embedded in the guidance? And if there is or is not, maybe you could also speak just qualitatively to some of the pushes and pulls on the restaurant level margin as we’re thinking about this year. So commodity inflation, labor inflation, any other inflationary pressures on the business. If you could just speak on that, and I think that will be it for me then.

Michael Rabinovitch: Sure, happy to. So we haven’t explicitly given any, call it, percent of sales or basis point guidance implied within our EBITDA guide for the year. But of course, it’s an element of coming out with those estimates. And I can certainly speak qualitatively and directionally into what we’re expecting to see. At Anthony’s, where you have same-store sales increases planned, you gain leverage on your fixed costs. We are seeing continue to see and expecting to see for the year expansion on the food side, primarily as a result of the stabilization in input prices especially chicken wings, but also as a result of the procurement activities that the team has been very busy on over the course of the last year, which includes things like changing out suppliers and are negotiating with existing suppliers to get the best possible price in order to try to manage price increases to the minimal level possible.

So we’re expecting good things on the topline and on the food side. The wage pressure, though, that we experienced in 2022 from a wages per hour minimum wage increases, moves necessary to keep top-performing restaurant retention. Those are going to cause what I would say, pressure on the labor line. But overall, expecting greater expansion than contraction. So the 2 tailwinds of topline leverage and food cost expansion should over encompass the labor rate pressures.