Good afternoon, ladies and gentlemen, and welcome to the Red Robin Gourmet Burgers First Quarter 2012 Conference Call. [Operator Instructions] As a reminder, part of today's discussion will include forward-looking statements within the meaning of federal securities laws. These statements are commonly identified by words such as continue, plan, achieve, expect, will, implement, optimize, target and other terms with similar meaning. These statements will include, but will not be limited to, statements that reflect the company's current expectations with respect to the financial condition of the company, results of operations, plans, objectives, future performance and business, including the company's traffic and revenue driving initiatives, intentions with respect to expense management and plans for deployment of capital and other expectations discussed during the course of this call. Although the company believes that the assumptions upon which the preliminary or initial results, financial information and forward-looking statements are based, are reasonable as of today's date. These forward-looking statements are not guarantees of future performance and therefore, investors should not place undue reliance on them. Also, these statements are based on facts known and expected as of the date of this conference call, and the company undertakes no obligation to update these statements to reflect events or circumstances that might arise after this call. Participants on the call today should refer to the company's Form 10-K and other filings with the SEC for a more detailed discussion of the risks, uncertainties and other factors that could impact the company's future operating results and financial condition. The company has posted its fiscal first quarter 2012 press release and supplemental financial information related to the quarter's results on its website, www.redrobin.com in the Investors section. I would now like to hand the conference over to Mr. Steve Carley, Chief Executive Officer of Red Robin.

Thanks, Lisa, and thanks, everyone, for joining us on our call today. Joining me are Eric Houseman, our President and Chief Operating Officer; Denny Post our Chief Marketing Officer; and Stuart Brown, our Chief Financial Officer. After Stuart and I deliver our prepared remarks, Eric and Denny will also be here for the Q&A portion of our call. So let's start with a few financial headlines. As we shared in our earnings release, and as you can see in Slides 3 and 4 of the supplemental information, during our first quarter -- first fiscal quarter of 2012, our restaurant revenue increased 4.7% to $294.6 million and total revenues increased to $299.5 million or 4.4% over the first quarter last year. Our company-owned comparable net restaurant sales increased 0.5%, driven by a 4.1% increase in average guest check. About half of this increase was price, and the balance was guests adding items to or trading up on their check, and this was offset by a 3.6% decrease in guest counts. Earnings per diluted share were $0.71, compared to adjusted earnings of $0.58 and GAAP earnings per share of $0.56 in the same period a year ago. On the development side during the fiscal first quarter of 2012, we opened 3 new full-sized Red Robin restaurants and our second smaller prototype Burger Works restaurant. Our restaurant-level operating profit margin increased to 21.2% from 19.8%, driven by sales leverage and lower other operating costs, partially offset by increases in food and occupancy expense. Our restaurant-level operating profit was $62.4 million or 12% higher than a year ago. Finally, our cash flow from operations during the fiscal first quarter of '12 was $29.6 million, compared to $29.9 million a year ago. Red Robin's 2012 fiscal first quarter results were mixed, in that we were pleased to continue our momentum in strengthening the business by growing net sales and earnings per share and maintaining cost control. But driving positive guest counts remains a challenge. While we began the year with strong sales and achieved modest year-over-year same-store sales growth during Q1, we were disappointed by the extent of softening in guest traffic in the second half of the quarter. Nevertheless, we remain confident that our long-term plan to strengthen our operating foundation, while we continue to differentiate the brand and position Red Robin for future growth, is solid. Throughout 2011, we provide quarterly updates on Project RED. Our 3 major areas of focus: Driving revenue, expense management and optimizing deployment of capital. Since we remain committed to our overall strategy and are focused on these areas, today and going forward, we will share some headlines on the progress we've made on the key initiatives under these separate areas. First, I mentioned that we were disappointed in our performance in the back half of the first quarter, especially in our guest count trends. We said before that we knew that we could hit some air pockets given the continued intensity of competitive discounting, the urgent and ongoing execution of our long-term plans and implementation of change across the organization, from operational improvements to more efficient marketing. While our guest counts in March and April declined, price mix was up strongly with over half of the price mix driven by folks, our guests adding on or trading up items on their check. Stuart will expand on this in his remarks, including the signs of progress we're seeing and the increased sales of appetizers and beverages, which is a key goal of our menu strategy. Still, we actually need to sell more burgers and entrées. In our Q1 LTO featuring the Big Melt Bacon Burger and TV ad support struggled to break through the clutter and drive the performance we were expecting on -- we were expecting. On the plus side, continued incremental and robust sales of non-entrée items is encouraging, as is the early guest response to the launch of our Tavern Double on April 30. At a price point of $6.99 including bottomless fries and featuring a trade up to one of 3 gourmet Tavern Styles for $1 more, it is intended to protect the average check. In addition to variety, we are now delivering everyday value. We're confident that the Tavern Double will be a great burger platform for us going forward as we execute our menu strategy both thoughtfully and profitably. You can see an overview of some sales and traffic-driving initiatives on Slide 5. During the first quarter, we were also very pleased with the continued growth of registered users in our Red Royalty program. We rolled out our best-in-class loyalty program to all of our company-owned restaurants in January of last year. So as of early Q1 of this year, we were a full year into the program. We now have nearly 1.7 million guests registered in Red Royalty, and we're continuing to explore how we can optimize engagement to drive profitable, incremental visits and frequency with those guests. We also made further progress on taking back the bar. In Q1, we passed the one year mark since our first rollout of initiatives to increase our beverage per person average check, boost alcohol beverage sales as a percent of total sales and deliver a greater double experience. Through the first quarter of this year, our beverage PPA continues to climb in both the alcohol and non-alcohol beverage categories. This remains an area of opportunity for us as we expand our event days such as drink specials around big sporting events, St. Patrick's Day and even this past Valentine's Day when we had a successful girls night out promotion to highlight our wine and dessert offerings. In addition to programs around beverages, we've also began making our bar environment more of an adult dining space. We're enhancing our audiovisual packages, revamping the decor and creating more of a bar atmosphere overall. We're currently testing and learning in a handful of restaurants with plans to expand bases to other markets over time. We're also having some fun and success with social media. We recently surpassed 300,000 followers on Facebook, which is about 82% more than we had in Q1 last year. Late in the quarter, we posted a $5 off, $20 off around Facebook and had more than 425,000 offers claimed during the 2-week promotion period, enlarging our total number of followers and creating quite a bit of buzz in the social sphere. And the redemption rate of 10%, this kind of promotional was clearly best-in-class and embraced by our guests. So we will continue to leverage social media strategically as part of our overall marketing mix. Finally with gift cards, they continue to be our source of success and growing opportunity for us. In the past, the year-end holiday season was the focal point for these sales. But we're now finding opportunities to generate news and awareness for our gift cards throughout the year with seasonal and special occasion themed cards. This is another area in which we are increasingly leveraging social media, as well as strengthening our relationship with our third-party distributors and our online marketing channels. In all of 2011, we sold $38 million in gift cards and we continue to expand our points of distribution, primarily with our third party vendors. So we believe our sales in 2012 will be even better. Let's move on to the expense management slide on Slide 6. As we said in our call in February, our continuous improvement efforts during 2011 reduced our operating costs at a faster pace than we anticipated. In the past, you've heard many examples of how we're accomplishing this. During Q1 of this year, we made even more progress attacking opportunities big and small. Through improved portion control in our side dressings, we're not only reducing food waste, but we're also capturing about $0.5 million a year in annualized savings. And by simply changing hot sauce suppliers we saved about $50,000 a year. You can see on Slide 7 our restaurant-level operating margins continue to improve, and the great work of our restaurant teams, their commitment is doing a super job managing our cost and is a big contributor to this trend. We believe we are establishing a culture of continuous improvement. It's incorporated our operations scorecards. It's part of our period review process with our management teams, and we have created an effective process for collecting, screening and evaluating new opportunities for improvement. So even when we achieve our targeted savings in 2012, this continuous improvement ethic will actually be part of our operational DNA. Lastly, on deployment of capital, Slide 8. In the first quarter, we opened 4 new company-owned Red Robin restaurants, including our second Red Robin Burger Works. Our new restaurants continue to perform well and generate strong cash on cash returns. So this remains a highly productive use of capital for us. This year, we expect to develop a total of 7 to 8 of our full-size prototypes, 2 to 3 mid-sized prototypes and an additional 4 Burger Works. Finally during Q1, we made additional progress on the upgrade of our IT systems. This, as we've discussed in the past, is a multiyear effort that will make our foundation stronger, our systems more robust and help us make better and more timely decisions with better business intelligence. It will also give us the tools to grow our business in the future. We recently introduced a new online hiring tool that screens and tests applicants and makes it easier for our restaurant managers to select qualified team members and bring them in for interviews. Comments from our managers have been very encouraging with the ease of the system, the quality of the applicants recommended and the time that is saved by prioritizing the applicant pool. We are finalizing the performance management and interactive computer-based training portions of our infrastructure improvements and in the coming months, expect to make progress on enhanced supply chain management and other essential tools for driving the business. So with that recap of '12s first quarter. I'll turn the call over to Stuart to give you a bit more color on some of our operating results and our outlook. Stuart?

Thank you, Steve. Good afternoon, everyone, and thank you for joining us today. As Steve mentioned our first quarter results were characterized by soft sales, but favorable cost of sales and very effective management of operating expenses. Compared to a year ago, our net income increased to $10.6 million, which is $1.6 million or 17% growth excluding last year's unusual items. Overall, considering the challenging sales environment, we are pleased with our accomplishments and are confident that we will capture opportunities for additional growth. Before reviewing insights from our first 16 weeks of 2012, let me first put our performance in greater context by taking a quick look back at the cumulative changes that have occurred over the past 2 years. As you have watched, the Red Robin team has significantly improved results, and we remain committed to continuing value creation into the future. Compared to the first quarter of 2010, total revenues have increased 8.7% on a modest store expansion program. Comparable store revenues have increased 2.7% through the introduction of a number of menu changes and modest price increases. Average unit weekly sales have grown to $56,300 from $54,800 in 2010. Restaurant-level operating margins have expanded 300 basis points to 21.2%, and a decrease in total operating cost of 400 basis points, and the benefit of sales leverage was partly offset by cost of sales, which increased 120 basis points. Excluding the onetime gift card breakage adjustment recorded in the first quarter of 2010, EBITDA has increased 50% to $32.4 million and EBITDA, as a percentage of total revenue, has increased 300 basis points to 10.8%. Likewise, the first quarter adjusted net income and earnings per share have both increased more than 3x over the past 2 years. Compared to the first quarter of 2011, as you'll see on Slide 10, comparable restaurant sales increased 0.5%, with guest counts having declined 3.6% and average guest check having increased 4.1%. Note that all reported sales numbers are on a net basis, and we will no longer disclose gross sales, which was revenue before loyalty incentives. As we have been discussing for some time, we've been making a number of changes to enhance our brand, including addressing our overall value, balancing price, product and experience as part of our strategy to increase profitable guest visits and average check over time. You may recall that last year we introduced a new menu design, new appetizers, including jump starters, combos and shareable desserts. Just 3 weeks ago, we introduced the Tavern Double burger that delivers great everyday value and is engineered for a compelling gross margin. To promote guest trade up, we have created different tasty styles such as our Pig Out and Buzzalo, which a guest can add for just $1 more. Some of you had the chance to try these at our investor update and we'll keep these fresh with different styles over time. The increase in average guest check in the first quarter resulted from guests adding items or trading up, with half the increase coming from last year's price changes. The average items per guest check increased 4.3% over the last year. A few examples include beverage mix, as Steve mentioned, which increased 80 basis points to 7.1% of restaurant sales, sweet potato fries, which was new in October of 2011, are now added by 2.8% of our guests and more guests are enjoying an appetizer with their meal than a year ago. The new items all have strong contribution margins, and we are getting better at suggesting to our guests to try these great additions. On the other hand, the decrease in traffic seems mainly caused by aggressive promotions by our competitors, and the inability of the marketing of our Big Melt Bacon Burger Limited Time Offer to bring guests into our restaurants. The sales mix of the Big Melt Bacon Burger was good at 4.6%, compared to the 2011 LTO, the Prime Chophouse Burger, which had a mix of approximately 4%. However, the advertising did not give the traction we would have liked or expected. We have taken learnings from this situation and applied them to the rollout of our Tavern Double by changing this advertising plan. You can see the ads on our website or Facebook page, and they have a bit more edginess with our unique set of triplets selling our 3 styles of the Tavern Double. In addition to our new menu items, we continue to be excited by the performance of our new Red Robin locations, where sales at restaurants opened over the past year have averaged $75,000 per week since opening. Our first Miami location at The Falls broke the record for opening week sales, demonstrating pent-up demand in new markets for quality burgers and great service, not to mention the great work of our new restaurant opening team. We were also pleased with the results and guest feedback at our first 2 Red Robin's Burger Works, which were opened in a lifestyle setting near Denver and a college campus at The Ohio State University. Our third location opens in Denver on May 21, which will be our inaugural central business district location. Looking at Slide 11, cost of sales was slightly favorable to our expectations in the first quarter. Cost of sales increased 50 basis points from the first quarter of 2011 to 25.5% with the cost of ground beef, fries and fry oil all having increased versus a year ago. And produce having decreased about 19% due to the favorable winter weather. Operating expenses continue to benefit from the cost savings initiatives we have been implementing, with labor as a percent of sales lower than a year by 90 basis points due mainly to the sales leverage on a higher average guest check. In addition, management of supplies, transaction fees and repair costs helped to expand our operating margins. Restaurant-level operating margins, as Steve mentioned, reached 21.2% in the first quarter, compared to 19.8% a year ago. Depreciation was $500,000 lower than a year ago despite the addition of 15 new restaurants due to equipment from restaurants placed in service in 2006 to 2008 becoming fully depreciated. Selling costs in the first quarter were $1 million higher than in 2011, due mainly to higher cost related to the gift cards, following the substantial increase in sales in the fourth quarter last year. Other general and administrative costs increased by $800,000 from 2011 to the higher equity-based compensation and costs related to the upgrade of our IT infrastructure and were partly offset by lower severance costs. EBITDA also grew strongly versus a year ago, up $4.1 million or 14.5%. EBITDA rose to $32.4 million for the 16 weeks ended April 15 and operating cash flow was $29.6 million, compared to $29.9 million for the same period last year as shown on Slide 12. We invested $10.4 million during the first quarter in new restaurants and maintenance capital as well our IT systems. We opened 3 new full-service Red Robins and one new Red Robin's Burger Works for a total of 4 stores, while we closed one Tennessee location and one franchise location also closed. While we didn't purchase any shares in the first quarter, we paid down $18.8 million of our term loan near the end of the quarter, of which $15 million was an early repayment of principal. Our new financial and supply chain IT systems remain on track and we are in the process of quality assurance testing. We will begin to use our acceptance testing later in the quarter in anticipation of starting implementation of -- in our pilot restaurants and corporate office in the third quarter. As far as our updated outlook for 2012, this is detailed in our press release and on Slide 14. The lower expected annual comparable store sales growth than articulated on our last call last quarter is due mainly to the softer sales trends in the second half of the first quarter. Still, we expect this to be mostly offset by slightly better operating margins with both cost of sales and operating expenses favorable to our original guidance. Capital expenditures are expected to be at the higher end of our earlier range due partly to capital costs associated with 2013 new restaurant openings and additional restaurant improvements. The economy and consumer sentiment remains fragile, and we can foresee the possibility of more turbulence from outside events as we move through the year. However, as we discussed at our investor day, we are laying the planks in place to assure our long-term success and growth in earnings and returns. We know that enhancing our menu and environments and providing great value to our guest is the ultimate winning strategy. Steve, back over to you.

Thanks, Stuart. In closing, as I said at the top of our call today, we were disappointed by the extent of the softening in guest traffic late in the first quarter as we, like many of our competitors, were buffeted by a volatile consumer environment. But with the early guest response to our new menu and the introduction of our great Tavern Double burger platform, we're encouraged by improved trends as we enter into the summer. As we talked about on our Investor Day, we are still in the early innings of building our platform for long-term growth and profitability. But most importantly, our business is already getting stronger, and our financial performance is improving. I appreciate all the talent, focus, ideas and hard work displayed by the Red Robin team members across the organization who work hard everyday to take care of our guests and contribute to our progress. With that, operator, I'd be happy to take questions.

[Operator Instructions] And we'll go first to Jeff Farmer, Wells Fargo.

Just curious, how the -- you mentioned the Tavern Double burger. Just curious how that actually represents sort of everyday value proposition for you guys? Is that -- my understanding is that's -- is that an LTO? Or is that a permanent part of the menu? How should I be thinking about that going forward?

The intention is that it's a permanent part of the menu, Jeff, and it allows us to have the $6.99 starting price point everyday for guests to come in and then choose to trade up from there either via the styles or to discover another signature burger. Also it comes with bottomless fries, which is a great value proposition, and we really emphasize that in our advertising because we know that bottomless is part of our value proposition.

Okay. And then just really sticking with that, sort of growing guest counts is obviously an important focus for you. The LTO strategy I think historically there's been 5 a year, sort of correlating that with -- I guess going after, communicating everyday value, what's going to change here over the next couple of quarters? Is there going to be just more intense focus on the value part of it? Will we see less LTOs? More LTOs? Fewer advertising dollars? More? How should I think about that?

Just for clarity, we've done -- traditionally, offered 5 over the course of the year and promoted 3 via media. So you can continue to expect to see us on air about the same amount, the same amount of level of spending. But I would say that we're looking at the mix of how best to move forward with the Tavern Double just being so new and looking at that relative to the opportunities to return to some proven winners perhaps in the back half of the year, but at this point, we're balancing the 2. I think we're always going to have that opportunity for those great signature $9-something burgers that guests have come to know and expect from us, and the challenging question will be, how do we balance the marketing of those 2 things. But we know our 2 biggest barriers to frequency and reach in terms of Red Robin guest usage are everyday affordability and creating a space within our restaurants where adults can dine and feel like they can get away from their kids if they didn't choose to bring them out that night. So we're working on both those things very heavily.

And next we'll hear from Conrad Lyon, B. Riley & Co.

A question about the cost structure. You've done a nice job in keeping the costs down and really my question here is just reviewing it, do you have a sense of what type of comp you need now to generate operating leverage especially at the restaurant-level operating profit?

Conrad, this is Stuart. I'm not sure I know the exact nature of your question. I mean, if you look at the margin expansion we've had and what that tells you even with the lower, the softer sales growth that we had this quarter is as sales will grow, I mean, the ability of that to flow through the entire P&L is going to be very, very meaningful. So I'm not sure if you're looking for a numeric answer or...

Yes, that's what I'm getting at. And essentially, is your cost savings sustainable and going in say next year as you lap these comparisons, I would have to think that as you just indicated that your -- perhaps with a 2% comp, 3% comp will continue to see your RLOP expand. Would that be...

Yes, you definitely will, and I think about a 1% comp lift is about $0.25 of EPS or which is about $5 million of net income.

Okay. Second question, I just want to make sure I get this right. I think Denny Post were just talking about your marketing spend. I know it's been about $29 million, I think, the last couple of years on an annual basis. So was that what you were saying that expect to spend about the same amount of marketing and advertising?

Yes.

Okay. Have -- you get this question, it always, it comes up in past calls, but I'll bring it up again. Is kind of a sense of the effectiveness of the advertising. Have you tried to quantify that more so, going to impact to see if you think there's areas of opportunity maybe to lower cost or is that still just too hard to get a handle on?

No, we're definitely beginning to make progress on that, getting our arms around that, Conrad, as both Steve and Stuart spoke to. We failed to breakthrough in Q1 offer. We learned a lot from that process about how to improve not only the message, but also the media associated with it. We have applied to the new promotion that's on air now. So we're putting a lot of discipline in place and ensuring that we don't repeat past mistakes, and that we get more value for every dollar we spend.

Got you. And this will be my final question. The new Menu Team that you just press released, was that a result of what we saw this quarter, the sales weakness? Or was that an initiative that was in place, and say, hey, let's get going and let's get some more innovative product out there?

Yes, absolutely, it was an initiative that was started back when I arrived last fall. So we've been out recruiting for a while to build up that team because we know we have a lot of things that we want to do going forward and again, I'd reiterate that the Big Melt Bacon Burger mixed very well in our restaurants and a lot of guests were satisfied. It was a marketing issue that we failed to drive them in.

From Raymond James, we'll hear from Bryan Elliott.

Just a quick modeling question and then a bigger picture one. So Stuart, can you help us a bit with -- how to think about the depreciation line going forward? Will it begin to rise sequentially in absolute dollars from here now that it sounds like we've fully written off -- somebody hit the life on a bunch of investments?

It'll stay probably a little bit more at this level. Again, this is 16 weeks, these are -- get averaged out for the next few quarters. It'll really start to turn on a couple of things, a, when we turn our new systems on because we've been capitalizing those costs since when we turned that on, which essentially will be late this year. Beginning of next year, you'll start to see the depreciation on that pickup and that'll be about a 10-year life. And then as we look at the remodels and things like that, the capital that goes out with those, you'll see depreciation pickup. So it's really more you'll see a pickup in the '13, not so much in '12.

Okay, all right. And then I guess help me understand the disappointment around the promotional and the response to the promotion in the context of, I believe I heard that the mix of this year's Big Melt was 60 bps better than the mix of the prior year promotion. Did I hear that correctly?

Yes, so what occurred is that the mix in terms of guests in the restaurant they opted into the Big Melt Bacon Burger with the same frequency that they opted into the Prime Chophouse last year. The issue is that we didn't drive incremental guests into the restaurants to enjoy that burger. So what we ended up with is essentially trade down to the existing guest. So we tried to roll a very successful promotion last year with a few less days, weeks of media and a less impactful message.

Okay. And when you look at the traffic kind of by month or even week-to-week, was it relative to industry because we saw a pretty big traffic shift in the KNAPP-TRACK numbers, first half of your quarter to second half of your quarter. Did you do better relative to KNAPP in the first half when the industry was stronger, much of it weather driven and worse when the traffic got worse for the industry in the second half? Or help us understand how you think you did relative?

I think we all benefited from the same start to the quarter. And we also have the advantage of very strong gift card sales and growth there. And so we all benefited from that January, February. But then we underperformed the underperforming category beginning about March, and I think it's a combination of suffering the same ills everybody else saw. The same -- some either called mild weather an ill, but the mild weather, gas prices, the consumer uncertainty, we picked up some baggage potentially, it's hard to quantify from the pink slime noise around burgers and ground beef, but we really turned below that overall traffic in the industry is when we again, try to roll a very successful LTO last year and weren't as successful at doing it. So we underperformed the category in the back half.

Our next question will come from Peter Saleh, Telsey Advisory Group.

So I'm just wondering in the second quarter of this year versus the second quarter of last year, can you remind us how many TV -- weeks on TV you were on last year and how many weeks do you plan to be on this year?

The weeks on TV in the second quarter of this year versus last year's...

Actually, no, actually in second quarter, we're on air rolling over dark from last year. We will not be on air in the same timing as we were before the summer. So I look at April, May, June, actually a number of weeks, I'm sorry, number of weeks is correct, timing is different, sorry about that. Number of weeks is the same, timing is different.

Okay, but all within the second quarter, the same number of weeks?

Yes.

Okay. And then in terms of pricing, I know you had taken some pricing last year in April, is that rolling off and have you taken on more pricing?

We have not currently taken on more pricing, but we've left the door open for consideration throughout the remainder of the year as appropriate.

Okay. And then in terms of trends into this quarter, have trends kind of rebounded a little bit from what you saw in April?

This is Stuart. We don't -- a couple of few quarters ago sort of stopped giving updates in the first few weeks of the quarter. I'm not going to tell you we're pleased with the traction that we're getting on the Tavern Double, but I think we'll sort of leave it at that.

Next up is Joe Buckley, Bank of America Merrill Lynch.

Stuart, at the investor meeting a few weeks ago, you kind of expanded the guidance a bit to guide for EPS growth in the upper teens for the full year. Modest changes here and there and the guidance comments in this release, was that upper teens EPS growth still what you're thinking?

Yes, and if you run through the other pieces of the guidance that we've just given, I think you'll end up at that same place.

Okay. And then just on the cost side of things. You mentioned the RED program, your report for the RED program, obviously, a little bit more prominence this call and highlighted a few cost and expenses. Is that effort, I know you've described that as continuously, but is it intensifying a bit versus what we might have thought at the beginning of the year?

I think the RED. I think RED program.

Just in terms of the expense traction, yes. As we talked about before, we've been sort of ahead of schedule in terms of the overall savings that we're going to get, but we're starting to reinvest some of that back into the menu and some of the other enhancements that we've been talking about. So the upside on that, we captured a lot of it. This quarter, we've done a great job on continuing to sort of expand that. We've got a few more initiatives that will still be rolling out this year that we can give some examples on but, overall, I think a lot of it sort of getting into being the run rate now.

Okay. And then just one more. Is the Tavern Double burger, is that being advertised on TV?

Yes, it is. It's running right now.

Yes, go to our Facebook page, Joe, and you'll see some pictures that'll make you hungry.

Or watch some round 2 NBA finals on TNT, you'll pick it up there.

We'll now hear from David Dorfman, Morgan Stanley.

First, I just wanted to dig in a little bit into the comp guidance for the year of up to 1% and just sort of how do you think about that in terms of going into second quarter you'll sort of start lapping that average check and probably can't rely on that as much to sort of offset traffic and sort of how you see this sort of traffic layering in over time to get to that 1% or up to 1% and what the bottom of that might be in your thinking?

Yes, if you look at the first quarter which is 16 weeks, that's the biggest chunk of the year was up 0.5%. I think that's where, as we've -- the words we've used, that's our biggest disappointment because that's where we're actually cycling again, the benefit from most of the price increase. So we had a price increase that we took in April last year of about 1.5% or so. Probably 1.4% or 1.3% is actually sort of flowed through and so that goes away. So for the rest of year, if you look at sort of from a traffic and comp growth standpoint, we are going to be -- our anticipation will be in sort of mid-single digits -- I'm sorry, 1.5% to 2%. Remember also last year's LTO also the chicken sandwich that we had didn't resonate and the strawberry salad didn't resonate really well. So we'll be cycling over that with some other products. So we've looked at it obviously, week by week and as Denny mentioned earlier, right now, those assumptions don't include any price in them.

And is it largely -- at least the traffic component is I mean, the next big thing I guess, the sort of new menu rollout in the second half or is there something that you're -- other than the LTO?

No. I mean, I think the biggest thing is really the Tavern Double that we've just rolled out.

Which again is not an LTO.

Yes, that'll stay on the menu.

So is the new menu rolling out in pieces like that? Or is there a day when you say we have our new menu in place?

The first effort is to get the everyday price Tavern Double launched and then we're considering weighing the options for the back half of the year, getting our testing done, and we'll make some decisions about that shortly.

Got you. And last question is if you could just talk about the performance of the sort of Red Robin units that are sort of closest to the Burger Works that have opened. Have they seen sort of similar trend to others or have they lagged or are there any sort of competitive or cannibalization you've seen?

David, there's no discernible cannibalization is the good news. But none of them are really close to our full-service restaurants. I think some of the other chains that may have done some similar things, our strategy is very different, right, so we're building Burger Works to go into locations that you can't put a full-service Red Robin. So somewhere where you can put a 2,000 and 3,000 square foot location such as a central business district is not going to be an overlapping customer base space.

Our next question comes from Will Slabaugh of Stephens.

Could you talk about traffic during the different day parts. I know you mentioned last quarter's call that lunch was a bit more pressured than most. So I'm just curious on the update there?

Yes, we continue to see a disproportionate pressure at lunch. We have more to give there because we have always done better there than our competitors have, and they certainly have come after it. That was one of the other factors in Q1 that we just haven't seen before, this heavy deep discounting at lunch. You've got Applebee's out there at $5.99 on air, T.G.I. Friday's is throwing in a drink at $6.99, Chili's had at least 3 different price points. I got an e-mail for a $5 for any burger, a local e-mail from Applebee's. I mean, there's just tremendous competition at lunch. And so that said, it did hurt us disproportionately no doubt. And it also kind of changed the pricing game a bit. Where they have been so heavily focused on 2 for $20s last year. They now came down and played in that $5.99, $6.99 price point where we have traditionally put our LTOs. So again, it points out the importance of our having an everyday offering and not just a lunch offering, but an everyday affordable offering that our guests can start with on our menu.

Got you. And on the menu there as a follow up. So you sort of gone after that value customer that you mentioned earlier with the Tavern burger and then at the Analyst Day I know you mentioned something about potentially going up as well with a higher priced entrée. Wondering when we might be able to see that on the menu?

When we're ready. I don't mean to be coy, but I think our first order of business is to address the everyday affordability, and we know that our guests is also going to give us a lot of room in terms of premium and gourmet. So we'll go there when we're ready.

Fair enough. Last for me. The buildout in your confidence around that acceleration, I wonder if you can speak to recent unit openings if you're still seeing that those strong openings you talked about a couple of weeks back and the initial returns there and just overall confidence in the number of openings you talked about at the Analyst Day.

Yes, no. As I mentioned, our restaurant openings that we've had over the past 12 months average weekly sales of $75,000. So it's a pretty good number. So we talked about at the Investor Day in 2013 of hoping to get 15 to 20 full-service Red Robins opened and up to 5 to 10 Burger Works opened. I can tell you, I think ICSC is going on in Las Vegas right now where our restaurant -- where our real estate team is meeting with potential landlords. We're in the process of expanding our new restaurant opening team to be sure that we've got the people available to get those restaurants opened. So it's going to be finding the right sites at this point. Again, that stays a little bit of a challenge just because there's not a lot of -- no new real estate coming out of the ground. So we've got to wait for somebody else to be moving out. The good news is, there's some landlords that are kicking some people out and making room for us. So we'll -- that's where our targets are.

[Operator Instructions] From Piper Jaffray, we'll hear from Nicole Miller.

Denny, I was wondering for the second quarter, you said the timing's different, the weeks are same for advertising. I was wondering how and why? Some detail behind that difference, please?

Yes, partly to -- we have planned this for a while to roll in when we were ready to launch Tavern Double. We just wanted to get going with strong momentum, get that product -- that item launched and carried into summer. So it was something we've had in the books for a little bit of time. So just when we were ready to launch Tavern Double.

So the weeks -- the advertising's moved up, it's happening earlier?

Yes. And the other thing I would say, Nicole, is we've looked over time at the effectiveness of our media and traditionally, summer, the summer timeframe that we had been airing has been our weakest return time period. So we believe that airing a bit earlier in the second quarter was going to generate stronger returns for us, as well as coupled with the launch of Tavern Double.

The other thing, Nicole, this is Steve. When you look at this year, it's a year-over-year comp nightmare. You start with Leap Year, you move into Easter flipping about a month, you go into London Olympics in August and then a presidential election in November, all of that pushes your normal media planning around in different ways.

Makes 2013 look like a breeze.

Another year never looks like a breeze for a marketer.

There was a question about the day part trends. Can you speak to check by day parts? I'm wondering about the appetizer and the beverage and the sweet potato fries pickup? Is that happening at one day part or across the board?

This is Stuart. I don't have the details right in front of me. I think it's a little bit more across board. Yes, I think Tavern Double probably will address a little bit more at lunch in terms of value at lunch than it will at dinner, but...

Well, I'd say generally you can -- and I don't have it exactly in front of me. But particularly the alcohol pickup is more driven by happy hour, it's going to be later day. And because we're featuring the appetizers with those. I think you'd probably see that then later in the day and also the customer and the consumer is more challenged around, more likely to pull back and be a little more reluctant to spend at lunch than they necessarily are when they come out with their families in the evening.

Okay. And one last question, Stuart, on the previous question, your real estate comment that some of the landlords are turning others away, could you just help us understand is it independence or your peer chain concepts where your trumping them in those locations?

I think this year, 2012, at least 3 of our openings were former restaurants. One of them would be in a chain that went bankrupt, the other 2 locations are a chain that I would say is a casual diner that a landlord would rather have somebody coming in that's driving more traffic into the shopping center, I'll put it that way.

Bryan Elliott from Raymond James is up next.

A couple additional questions here. I guess, first, can you, obviously, you're enthused about Burger Works, can you give us maybe a couple anecdotes or a data point or 2 to help us share your excitement?

Well, Bryan, we are pleasantly surprised or I should say surprised, but we're pleased with the results that we've seen so far. And great feedback from our guests, especially in some of the college stadiums that we're going into like OSU, a great millennial responses, and we're just really happy with some of the numbers. Good check average. It's great value. Hearing a lot of things about the food quality and the service model that we've adopted. We really looked at adopting the kind of the Chick-fil-A service model in the front of the house. So guests are noticing that and giving us credit, but it's still -- we still have a long way to go.

Right. This is Steve. We're also having quite a lot of fun with it from a location standpoint. The OSU unit is several blocks away from a Five Guys, and the store that's opening on 16th Street Mall is just a block or 2 away from a Smashburger. So we're really enjoying that element of the learning too.

All right. Fair enough. The second question relates to the Tavern burger. So this is not just an LTO but a new platform. Can you elaborate some more on that and is it a full margin product? And what are the -- some of the particulars on it that -- what are the platform aspects, I guess, what can you really do over time with it?

A lot of things. I can tell you that, one, it is definitely a new platform for us, engineered with existing ingredients for the most part in our restaurant and then were bringing in unique things to create these styles. So we're very excited about it being kind of today's version of what we traditionally been known for which is these great gourmet builds over time. And I would say, we've been encouraged by the take on the builds even more so than the research had predicted. The styles, the Pig Out, the Cantina Jack and the Buzzalo all have their fans, and they're all pretty unique and interesting. So if taking a value sized, value priced burger, that would still -- it's almost 2/3 of a pound by the time you put these 2 patties together. The double platform is a great value and when you add on the dollar style, you're really getting some unique experiences. We're also coupling it with a new way of presenting in restaurant. We've gone to a menu card and are going away from the table clutter and the cube that we've used over the years. And so I think it's helping our guests to really focus on this new idea and make product choices for themselves and then if you flip the card, we just added a terrific Salted Caramel Shake that we're loving as well. So I do think over time, this is something that people are going to be -- they're going to find their favorite with the styles or they'll be intrigued by new styles that we'll be bringing out. It's a very easy way for us to add news to our menu. And it's got an indie kind of cred to it, a little bit which is again, in this world of social media, the way we're approaching these styles, these are things that will get some buzz and some interest.

Next up is Steve Anderson, Miller Tabak.

Seeing the disparity between the average weekly sales of newly opened locations versus the rest of the system, do you see any kind of drop off from the honeymoon year to any extent, maybe you can respond to that?

Well, Stephen, you're always going to typically see a drop-off from honeymoon sales. I would say we're very encouraged by as we talked to you on Investor Day, where the sales are holding for the 2010 and 2011 class. I think that shows that the brand has staying power in a lot of these new markets and very -- we're hearing a lot of guest feedback in new markets that have been seeing our television commercials the last 3, 4 or 5 years and haven't had a chance to get to a Red Robin. So I think there's -- you will obviously see a drop-off, everyone does. But we're real encouraged with 2010, 2011 where they're performing today.

Next we have a follow up from Peter Saleh, Telsey Advisory Group.

Just a quick question on the guidance. Is there any buyback embedded in your upper teens EPS guidance for the year?

No. There's no -- as we have said before, capital outlay, we're going to be opportunistic in that. There's no specific guidance out there for buybacks though.

Okay. And I don't know if I missed this, but how much of the $16 million to $18 million in targeted savings have been realized at this point?

I think sort of talked to that earlier, an earlier question I mean, from a run rate standpoint, I mean we're almost there and any additional that we get over that we're planning -- we've already planned to sort of reinvest back in the business with some of our enhanced items that are going to be coming on the menu.

And then Stuart, I know you ran the contest for the -- in giving away the -- writing a check for the top idea in terms of other cost cuts. Can you tell us what the top idea was?

Yes, it was actually a lot of really good ideas. The really best one and it was one by one of our general managers who has recently taken over a learning and development role -- so really the winning idea was really going from a disposable kids cup to a reusable kids cup, which obviously from an environmental standpoint's a winner, from a cost standpoint's a winner and some that we've kicked around for a while, but it's worth about $350,000 just that idea. The next one was looking at the way we served knives and the knives that we're using in our restaurants, should we go into a steak knife, which we use in some of our restaurants as well and the list goes on and on, but it was a lot of fun, believe me, it was a great check to write and a few people that actually -- a couple of extra people who ended up getting extra checks actually donated it tho the Red Robin Foundation to help out other team members, which was also really great.

And at this time, there are no further questions. Mr. Carley, I'll turn things back to you for any additional or closing remarks.

Thanks, Lisa. I will now wrap it up for our Q1 '12 conference call. Thanks, everybody, for your time and attention. We look forward to talking to you going forward, have a great evening.

And ladies and gentlemen, that does conclude today's conference. We would like to thank you, all, for your participation.