Good morning and welcome to the Arcos Dorados' First Quarter 2015 Earnings Call. A slide presentation accompanying today's webcast, which will also be available in the Investor section of the company's website, www.arcosdorados.com/ir. And as a reminder all participants will be in listen-only mode. There will be an opportunity for you to ask questions at the end of today’s presentation. [Operator Instructions]. Today's conference call is being recorded. At this time I would like to turn the conference over to Daniel Schleiniger, Director of Investor Relations. Please go ahead sir.

Thank you. Good morning, everyone and thank you for joining us today. With me on today's call are Woods Staton, our Chairman and Chief Executive Officer, Sergio Alonso, our Chief Operating Officer and José Carlos Alcantara, our Chief Financial Officer. Before we proceed I would to like to take -- make the following Safe Harbor statement. Today’s call will contain forward looking statements and I refer you to the forward-looking statements section of our earnings release and recent filings with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or changed events or circumstances. In addition to reporting financial results in accordance with Generally Accepted Accounting Principles we report certain non-GAAP financial results. Investors are encouraged to review the reconciliation of these non-GAAP financial results, as compared with GAAP results, which can be found in the press release filed with the SEC on Form 6-K. I would now like to turn the call over to our Chairman, Woods Staton.

Thank you, Dan. Hello everyone and thank you for joining us today. We entered 2015 well aware of the challenges we face in delivering improved financial results amid continued weak economic and consumption growth in the region. It is for this reason that we developed our three year strategic plan to generate shareholder value through enhanced, profitability, better cash flow generation and a disciplined approach to capital allocation. While we don’t expect the operating environment to change materially in the near future, we are confident that this long term strategic roadmap will result in a sustainable improvement in our financial position as we continue to focus on the customer experience, streamline our business, capture operating efficiencies and extract value from certain assets. Meanwhile, every day we serve more than 4.3 million guests across Latin America. McDonald’s remains a preferred QSR restaurant and is a QSR brand with the highest top of mind [ph] in all of our markets. We are committed to ensuring that our guests continue to receive the very highest level of service which is the hallmark of McDonald’s system worldwide. Our commitment to customers extend beyond the front of the restaurant. Our Puertas Abiertas or Open Doors program invites families to go into our kitchens and learn where their food comes from and discover how their favorite meals are prepared. Over half a million guests participated in Mexico alone in the last 12 months and we recently launched the program throughout Arcos Dorados system. We expect well over 1 million customers to visit our kitchens in 2015. Our customer focus together with our three year plan will drive long term brand loyalty and reinforce our leadership in the QSR segment. Having first presented our three year plan two months ago, we have laid the foundation for each…

Thank you Woods and hello everyone. On a consolidated basis organic revenues excluding Venezuela increased 6.9% in the first quarter. As reported revenues declined by 7.7% primarily due the depreciation of the Brazilian and Argentina currencies. Systemwide comparable sales rose 3.8% as average check growth more than offset a decline in traffic. Turning to slide three, Brazils first quarter’s revenues were impacted by this unique depreciation of the [Indiscernible] which more than offset flat comparable sales and the contribution of new restaurant openings. Reported revenues decreased by 14.6% largely due to the 22% year-over-year depreciation of the Real. In [Indiscernible] revenues grew by 3% versus the prior year quarter. System wide comparable sales were level with the prior year period of SLAD’s consumption led to lower traffic levels and offset average growth. First quarter traffic was also impacted by our past year-over-year comparison as the marketing calendar was adjusted given World Cup schedule and the monopoly campaign launched in March last year while in 2015 it launched at the end of April. The net addition of 51 restaurants during the last 12-month period, of which over 60% were free-standing units, contributed $23.5 million to revenues on a constant currency basis during the quarter. As Woods mentioned in his opening remarks, we are in the process of rolling out a new forecasting and scheduling system in our Brazilian restaurants. I am pleased with the pace of the rollout which is expected to be completed by the end of this year and I’m encouraged by the positive results we’ve seen in the restaurants where the system has already been implemented. This system will allow our employees to be better prepared to several customers throughout all the parts and thus ensure we continue to efficiently deliver the best customer experience. After rollout expands…

Thanks, José Carlos. As we’ve described we are making the necessary tactical adjustments to navigate through the current environment and deliver value for the benefit of our customers, our system and our shareholders over the long term. We are staying at the forefront of what is important to our customers by delivering the best food in the most inviting environment. We remain connected to our guests through interactions in the kitchen via our Puertas Abiertas program and through social media with novel campaigns such as the one we did utilizing twitter and our partner the Coca Cola Company. Program that enhances our food quality and the customer experience coupled with our continued scrutinization of G&A optimize our asset base and capture operating efficiencies are laying the foundation for sustainable and profitable growth. I also want to share with you something that makes me very proud. For the second year in a row, we are among the top five best companies to work for in Latin America according to the Great Place to Work Institute. To be in the top five it’s a huge achievement for a company such as ours. While we expect a short term operating environment in our region to remain challenging we have a resilient business model in place significant competitive advantages and experience in every type of operating environment. As we work to become leaner and more efficient we will maintain our excellent customer experience levels to ensure sustainable growth in our business and in shareholder value over the long term. Thank you for attention. I would now like to open the call up to questions.

Yes, thank you. We will now begin the question-and-answer session. [Operator Instructions]. Our first question comes from the location of Jeronimo De Guzman with Morgan Stanley. Please go ahead.

Hi, good morning. I wanted to start with a question on your corporate expenses, because when I look at the results from corporate they are up in about 65% in Argentine pesos, 40% if I take out the impact from the variable compensation that you mentioned, so it seems like they continue to grow above the local inflation as they did in also in 2014, so just wanted to understand what is driving this pressure and do you see any opportunities to reduce that going forward?

Hi, Jeronimo thanks for your question let me pass it to José Carlos. José Carlos Alcantara: Yes Jeronimo as I mentioned in our script by now we have two basically one offs or impact from the G&A in the quarter. No inflation evaluation difference in Argentina which you alluded to, which accounted for approximately $3.1 million and the adjustment in the accrual for variable compensation in the first quarter of 2014 which related to 2015. Additionally what we didn’t include here in the explanation script, there is two other factors that played out in the quarter in corporate G&A, one, we had some severance costs in the quarter related to some executives that exited and we also carried two CFOs for the quarter, so that’s an additional clearance that we don’t expect going forward. And but if you exclude the two items that I first alluded to absolute and absolute G&A would have decreased 12%, so total G&A.

Okay, but I guess just to clarify I mean I understand the variable compensation is something that’s a one off but the inflation is something that will recur, right. So if you are up about in case you are up this higher level of 40% I mean are you comfortable with that or do you think there is room to further control these G&A expenses given the weaker top line trends. José Carlos Alcantara: No I think there is room to further control. We expect that the Argentine peso will be valued at some point from now until the end of the year and that’s when you know the devaluation will catch up to that inflation, so again this is just the timing situation I think the Argentinean peso has been held because of political reasons at this point.

Okay, thanks and then just a question on Brazil. Wanted to know if how you are seeing recent trends if you are seeing any improvements in the trend now that the comparison based from the monopoly is no longer there and just in general what your outlook is for same store sales in Brazil whether you think that the traffic trends can improve, but what can you do to get the traffic trends to improve?

Yes, let me pass it to Sergio for that answer.

Yes thank you Woods and morning to everyone. Well traffic in Brazil continues to be impacted by I would say a soft consumer environment and a shift also to the informal [ph] sector as you know as a consequence of this softer consumer environment people obviously are changing to into lower and less formal types of restaurants in the market. However, if you compare our performance for quarter -- Q1 against Q1 last year, I have to highlight that last year we’ve run monopoly campaign, which was a very strong in March, while this year we’ve started in late April, so we have that shift –timing shift I would say, that plays against 2015. Overall having said all that, considering that we foresee overall challenging consumption environment, we are focusing on protecting traffic obviously and market share enhancing our value proposition.

Okay. So do you see, I mean do you see…

The next question comes from Mr. Amod Gautam with JPMorgan. Please go ahead.

Hi, good morning. Thank you. The first question was just around – there’s been some news about malls kind of mall traffic just because of oversupply in Brazil. And I was just wondering, if maybe you could comment about the performance of your units in malls relative to free-standing units?

Yes. Good morning. Well, malls are not performing as we would like them to perform, and I think that’s a little bit of a measure what’s going on with the economy in general. And as you can imagine we depend on mall traffic to do our sale. So, -- then also there’s another additional factor which is the new malls that have been opened – opening have had some tenant mix issues. And obviously a mall that’s not fully versed with tenants is a problem. So they are not performing as well as our free-standing units.

Okay. And then the follow-up was just around where the COGS hedging is for 2015 and in terms of what rate that the commodities are locked in Brazil and then whether or not you started to lock in particular rate for 2016?

Yes. Let me pass it to Carlos. José Carlos Alcantara: Yes. Hi, Amod. As I mentioned we’re fully hedged in Brazil for food and paper exposure which is basically toys that we import from China and potatoes from Argentina. Our hedged for the full year is around 261. We’re also partially hedge in other countries. We’re partially hedged in Colombia and partially hedged in Chile for the year. As related to your, as your 2016 question I think its little bit too early to start looking into that, but we’re obviously consider that as we start looking into our plans for 2016.

The next question comes from Mr. Everett Weinberger with UBS. Please go ahead.

Thank you and good morning. Two questions. Number one, given the enormous challenges that the Venezuelan operation has presented Arcos in recent years and given it’s not expected to improve given the horrendous political and economic environment there, is there any possibility that you would divest yourself off the Venezuelan business. Have you pursued a divestment and found no buyers or is it something you would never consider selling at one point do you admit this is not a great investment and take action to stem the bleeding? The second question are you seeing any evidence that McDonald’s in Latin America is suffering from the migration to fast casual that is impacting McDonald’s in the U.S. or is this is a totally different environment than the U.S. and there really is no fast casual category yet eating into McDonald share there? Thank you.

Yes. Good morning, Everett. How are you?

I guess very well.

Regarding your first – great and good questions. In the case of Venezuela as you are aware we have a master franchise agreement with McDonald’s Corporation for all of the territories and we’re responsible for all of the territories and countries we’re operating. So we cannot and would not pick and choose what is good and what is bad. And I think eventually Venezuela will turnaround as you probably know in Venezuela we have the self-sustaining. We’re not putting any more money into the country. We operate with what we have. So it’s a challenge from a point of view operations, but I will tell you that one of the strongest brands that McDonald’s is strongest in Venezuela vis-à-vis other country. So we’re very proud of our Venezuelan operation, of our Venezuelan people and we will continue there operating amongst [Indiscernible] as long as we can. In regards to your second question regarding fast casual, fast casual grows all over the world, but I would say that if you look at our markets, our biggest market potential is within formal eating out categories and bring as you ever burgeoning middle class, that middle class comes to us and where McDonald’s has a highest top of mind in all QSR, yes they are growing, but I would not say at this point. The challenge there would be in a more developed like the U.S. or some European countries.

The next question comes from Robert Schweich with Burnham. Please sir, go ahead. Your line might muted, sir. You are on the phone. You can go ahead.

Can you hear me now?

Yes, sir.

Hi, Bob, yes.

Sorry, they had phone. It didn’t seem to work well. Thank you. I was also interested in Venezuela but you’ve answered the question and I expect your answer. It is for investors discouraging that haven’t excluded when really it is part of the company and it is a confusing situation and I’d like to see you try and address that aspect as best you can in your results in the future. It’s not a question, it’s a comment related to the earlier discussion of Venezuela. The second question, secondary that I’m interested in is how does the change in tough management and the new plans in Chicago affect you?

Hi, Bob. Good to hear you. Good questions and we will report both with and without Venezuela. You have access the Venezuela numbers, but we’ll see we can make it more easy to look at. And as far as the top management changes in McDonald’s Corporations, obviously the effect is quite a bit, I mean, we are the largest franchisee in the world. We are very supportive of a changes that McDonald’s have announced regarding against future strategy. We know the new management Steve Easterbrook and like him very much and we look forward to working with him. And on a personal level I think that the changes that they are pursuing will have a positive impact on McDonald system moving forward and that’s good for us. The world today is the smaller world given the social media and what happens in the other parts of the world impact us whether we like it or not, so I think that we’re in good hands. We’re very confident that the brand is in good hand and moving forward.

Thank you.

Thank you, Bob.

[Operator Instructions] The next question comes from Veronica Armas [ph]. Please go ahead.

Hi. Thank you for taking my question. I wanted to ask you a little bit more about Covenant Bridge under the master franchise agreement. And just wanted to know if you think that is three-month additional waiver is enough to reverse the situation, do you think you will be requesting more waivers basically what are the consequences of this? Thank you

Yes. So let me pass to the José Carlos, so he can answer more precisely. José Carlos Alcantara: Hi, Vernonica [ph]. As you alluded yes, we obtain from McDonald’s a waiver through March 31, 2015. We’re monitoring the situation closely. This is very dynamic environment at this point. And we expect that continued conversations with McDonald’s will happen and they’ll supportive if we need to obtain additional waivers in the quarters to come. But we don’t expect that this will impact our ability to operate the business or our financial strength.

And okay, but maybe you could give us a sense or where this covenants at levels they are? José Carlos Alcantara: That something we can go into detail. We can follow-up later on if you want and get some detail on the covenants, but again…

Okay. Sure. Okay. No problem. Thank you. José Carlos Alcantara: Thank you.

At this time we’ll turn a conference back over to Mr. Woods Staton. Please go ahead.

Thank you all for joining us today. And thank you for your questions and attention. We look forward to speaking with you next quarter and encourage you to reach up to the team with any questions you may have. Thank you and have a very good day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.