Greetings and welcome to the Bloomin' Brands Fiscal First Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow management's prepared remarks. It is now my pleasure to introduce your host, Mark Graff, Group Vice President of Investor Relations. Thank you. Mr. Graff, you may begin.

Thank you, and good morning, everyone. With me on today's call are David Deno, our Chief Executive Officer; and Chris Meyer, Executive Vice President and Chief Financial Officer. By now, you should have access to our fiscal first quarter 2020 earnings release. It can also be found on our website at bloominbrands.com in the investors section. Throughout this conference call, we will be presenting results on an adjusted basis. An explanation of our use of non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures appear in our earnings release on our website, as previously described. Before we begin formal remarks, I'd like to remind everyone that part of our discussion today will include forward-looking statements, including a discussion of recent performance. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from our forward-looking statements. Some of these risks are mentioned in our earnings release. Others are discussed in our SEC filings, which are available at sec.gov. During today's call, we'll provide a brief recap of our financial performance for the fiscal first quarter 2020 and a discussion regarding current trends. Once we've completed these remarks, we'll open up the call for questions. With that, I'd now like to turn the call over to David Deno.

Well, thank you, Mark, and welcome to everyone listening today. Our priorities remain unchanged as we continue to navigate these challenging times. We are focused on taking care of our people and serving food in a safe environment that protects both our team members and customers. We have leveraged our strong off-premises business since the pandemic required the closure of our dining rooms. As a result, we have tripled average off-premises sales for restaurants since the beginning of March. This is a testament to the strong affinity for brands and the decision to invest significantly over a number of years into building a robust delivery network to complement our takeoff business. These outstanding off-premises results have allowed us to keep substantially all of our locations open during this time. The goal going forward is to keep a large part of the share gains we have seen in carryout and delivery. We've also recently begun the process of reopening our dining rooms as state and local governments allows. For perspective, we had 23 Outback Steakhouse restaurants open for dine in service with restricted capacity during the full week ended May 3, 2020. Comparable sales at these locations were down 17% from the prior year. We are encouraged by these results. As of this morning, we have 355 dining rooms open across all brands, with limited seating capacity in 10 states. As these dining rooms reopen, we are adhering to strict safety measures. This includes additional sanitation and disinfecting practices, enhanced hand washing protocols, use of gloves, and face protection for employees. We're also providing contactless payment options for our customers. Each diner seating configuration has been modified to adhere to social distancing and reduce capacity standards. For added convenience, we are leveraging our cable management notification system to allow guests to…

Thanks, Dave, and good morning, everyone. First I'll provide a brief summary on our financial performance for the first quarter versus the prior year. Total revenues decreased 10.6% to $1 billion. GAAP diluted loss per share for the quarter was $0.44 versus $0.69 of earnings per share in 2019. Adjusted diluted earnings per share was $0.14 versus $0.75 last year and adjusted restaurant level operating margin was 12.5% versus 17.1% last year. Through the first two periods of Q1 2020, combined U.S. restaurant comp sales were up 2.6% with positive traffic at all of our concepts. In addition, adjusted operating margins were up 100 basis points from last year. It was a strong start to the year, but as we entered March, the COVID-19 pandemic had a significant impact on our Q1 adjusted results, such as, sales deleveraging across the P&L, driven by the closure of our dining rooms. The payment of $16 million of relief pay in March which impacted the labor line and increases in restaurant operating expenses primarily supplied, driven by the shift to an off-premises only business model. As it relates to our cash utilization as the pandemic began to impact our business, we took immediate actions to minimize spending including the elimination of essentially all discretionary expenses. These actions combined with steadily improving sales performance have allowed us to reduce our weekly cash burn rate to $6 million to $8 million per week. Now that our dining rooms have begun to open with limited seating capacity, we expect this burn rate to continue to improve. With respect to near-term financial performance, it is important to consider a few key items. First, incremental profitability flow through will be lower in the early days of reopening our dining rooms, as we will incur additional service labor among…

Thank you. At this time, we'll be conducting a question-and-answer session. [Operator Instructions] Our first question comes from the lines of Jeffrey Bernstein with Barclays.

My question is -- I have a question and a follow-up. The question in terms of the reopening of the dining room that you've already started to do and it seems like the early results are encouraging. I think you said costs were only down 17%. Just wondering, if you could share some color in terms of your confidence or why you might be confident and believing you can sustain that once the novelty of the dining wears off any kind of learnings you've had in those stores. Will you know how to dine-in and to-go? Just trying to gain confidence in that recovery trend? And then I had one follow up.

First of all, we have worked tirelessly to make sure that when we reopened restaurants, we opened the very safely and appropriately for our customers and our employees. And it really helped to have a full staff ready, I'm ready to go trained as we reopen the restaurant and that really helps us out a lot. So the team is ready, the protocols were in place, the communications were in place. So Jeff, we're seeing the gains sustained in those states. And also we when we moved to new states, we are having conversations with our state coming on board, talking through the learnings. So as we share those learnings with other states, we get stronger and stronger and stronger, understand what's going on. I mean, clearly, people love our brands. The team is doing a fantastic job and the restaurants, and we will comply with all state and local regulations, but we're ready to go and we're going to learn from it and get stronger.

And then just my follow up in terms of the commentary and the prepared remarks about the convertible notes, obviously, you had various options, just wondering what led you down that route? And I think you mentioned the extra liquidity ally to capitalize on opportunities in the near-term and just wondering if you could provide some color on what opportunities that might be. In fact, I know you mentioned there was some interest in maybe buying a piece of the Company as part of the strategic review. So any color you can hear to that would be great as well? Thank you.

Yes. I'll start on the first piece, and I'll turn it over to Dave. Hey, so I think that with a convertible bond, particularly with the call spread, honestly, it was just candidly the lowest cost of capital option available to the Company. When you add the call spread feature, it further improves the cost of capital and makes it -- honestly makes it more behave like a traditional bond offering, and that you can repay the principal in cash and it avoid share dilution up to I think the price is up to $16.63. So really cost of capital is the primary motivation also the bond like the features that it brings to the table were also very compelling. And Jeff to your second point, we want room to maneuver with our existing concepts. We want to protect the gains, the market share gains we've had an off-premises, they've been really strong. We want to have resources to be able to protect that. We want resources to be able to optimize our asset base. We want resources to take advantage of what's coming ahead for us. So, that's why we want additional liquidity plus just to have that safety. So, we felt good about situations going in. The team did a good job raising the extra money and it gives us optionality, as we move forward with our concepts to make them even stronger.

And any color on that interest of some investors and investing in the Company more significantly?

No, nothing else really to add there.

Thank you.

Thank you. Our next question comes from line of John Tower with Wells Fargo. Please proceed with your question.

Great. Thanks for taking the question. Just kind of curious on that last point you made there, David, just did in terms of cleaning up or thinking about the portfolio in terms of moving forward and improving the existing concepts and potentially optimizing the asset base. What do you mean by optimization of the asset base? It looks like in the first quarter you've closed a few stores, I mean, are you thinking about potentially shutting down some more in the future? How should we think about that? And then I do have a follow up.

Yes. No, when I talk about optimizing the asset base, I'm talking about going on the offense. We've done a good job over the years, addressing our closures and things. And we may have a few, but I'm talking more about building your off-premise business even stronger, building our dining business even stronger. That's going on the offense as opposed to doing more defensive stuff.

Okay. And you gave some qualitative information on Brazil. Can you maybe help quantify what you're seeing right now down in that market? And then just in aggregate, what you're thinking about for the balance of the year? When these competitors last night was out, and they offered an outlook for the remainder of 2020, where they were thinking that, they're not going to be moving back to positive same store sales. And just kind of curious to get your thinking there as well.

Yes. On Brazil, they're performing somewhat similar to our Bonefish brands. They didn't have much of a carryout business, they're down 70. So, we basically have built a carryout business there. We've tripled, I believe -- almost tripled the delivery business there. So, they've done a really, really, nice job managing that business. So, it's -- Pierre and team have done a good job, capturing the opportunities in the marketplace. And the second question again.

Yes, it's related to kind of forward-looking guide.

Yes, it's honestly just too early, I think at this point. Obviously, we're still in the early days of just opening up the dining rooms. So much of it depends on government regulations, how fast they can eat, some of these restrictions that relates to capacity. Hopefully, by the end of the second -- end of this quarter, we'll be in better shape to give some perspective on that. But we're just in such early days as it relates to the dining rooms, but it's not prudent at this point to give any guidance on the balance of the year.

Alright, thank you. I appreciate it and best of luck.

Our next question comes from line of John Glass with Morgan Stanley. Please proceed with your question.

Chris, first, can you just do the walk on the 6 million to 8 million on cash burn? What's the breakeven level at the store level on an average would be sales basis? What are you assuming for just for weakly G&A just so we can understand the sensitivities around that?

Yes, so I'll give you a little perspective on some of the various buckets. We'll start with sales. I think we're assuming levels that are at or above current levels with a small contribution from the reopening of our dining rooms. And I think that's why we gave the perspective that we think we can improve the burn rate as the dining rooms continue to reopen and our sales improve. I guess on the expense side, full salaries for field management and restaurant support center staff. The relief payments that we've been making should go down significantly as our dining rooms reopen. Obviously, you'll have increased costs or COGS and hourly labor as the restaurants ramp up. Minimal discretionary spending, with really only maintenance capital in the model in terms of that 6 million to 8 million, there'll be a small amount of marketing in that number, mostly digital, and then I think as it relates to rent, that's the other big toggle. So, obviously, we have really good relationships with, our 900 plus landlords, and we're proactively speaking to them, since this pandemic began. I think there's good the good news on that front as there's pretty broad recognition among landlords that, even though we have shored up our liquidity position with the recent capital raise, we're still burning $6 million to $8 million of cash a week. So, they also recognize that we're going to be here for the long haul. So they're generally open to having conversations about deferrals and abatements. But in terms of our liquidity model, to give you some comfort, ongoing rent payments are contemplated in this burn rate, and in the go forward liquidity planning just to avoid any confusion. So, the last thing I would say is just as you think about that $6 million to $8 million, it does exclude any changes in working capital, either in payments that we've deferred or deferred to future months, or on the flip side, any working capital built up as the sales improve. So hopefully that gives you the right perspective.

Well, just one additional question on that. What is the average sales safety Outback brand that gets you to cash flow neutral at the store level?

It just depends because here's what I would tell you. So if you look at the weekly sales that we were generating an Outback with an off-premises only business model, those levels we were able to get to that sort of cash flow neutrality, if not at a restaurant level come up. And then I would say, like I said in the prepared remarks, as you layer in the dining room labor, the initial labor, those dollars in the early days aren't quite as profitable. So, you're going to have to work through a daily several sales level that gets you back to break even. So it really just depends -- I think, if you're looking for the right perspective, what I could say is, John. If you think about our total P&L fully burdened with all of the costs associated with our restaurant support center, all the G&A layered in, interest expense payments layered in, you're probably -- and again, there's so much that can go into this. But you're probably in that down 20% to 25% of range, before we could get to what I would call cash burn neutrality, so that you're not burning cash on a regular basis, if that makes sense.

Yes, that's totally helpful. I appreciate that. And then, just quickly, just on the off-premise business, how much of that has been delivery? I mean, obviously, it was a push left late last year in the second half of last year. So how much is that take up businesses delivery? How much is your delivery versus third-party delivery, any contacts that will be really helpful?

Yes. So, as you know, coming into this, we had such a strong takeout business and takeout still remains predominantly the vehicle that the customers are using. We're probably about two-thirds take out, one-third delivery at this point. And then, if you look at the toggle between the two delivery forms either are in house or the third parties, it's about 50-50 split between those two.

And what we're seeing is on the third-party is that new customer that makes it so interesting. And when I talk about going on the offensive and doing things, I mean, preserving that and moving forward with that's going to be really crucial, as we go forward in the rest of the year and after that.

Our next question comes from John Ivankoe with JP Morgan. Please proceed with your question

You could imagine some of the strategic initiatives specifically around G&A could be either accelerated or pushed back because of COVID. So I was just hoping, if you could, I know, we don't want to get into fiscal '21 guidance too much. But could we think about a fully loaded incentive comp being paid G&A number for '21 or '22? Just again as there are so many moving pieces and different things just kind of become prioritize new organizations just from a dollar perspective? It's the first question and secondly, on Brazil, that was a market that you were growing before. In terms of units, I mean, how long should we expect either development in Brazil to be curtailed? And I was hoping, if you could give us some detail around the $12.5 million cash distributions for Brazil, why do you think that would just be a one-time event versus a potentially recurring one?

Yes, sure. John, I think, when we addressed our overhead in February, we talked about $40 million over two years. That's moving forward. We continue to look at going to market in the most efficient, effective way possible, the Company that will move forward. We've learned a lot during this process like the last company may have. So, we'll continue to manage our G&A appropriately, going into '21. It's too early to give a particular number, but I can tell you all of our niche initiatives are on track and then probably more. So, that's going to be a big part of our story as we move forward. On Brazil, it continues to be a really strong business for us. And we've got to manage our cash and cash flow. We continue to believe in the business and was returning to us and as our resources open up, I'm sure will expand down there, but it's too early right now to say exactly when that would happen. What to see how the marketplace moves forward in the U.S. and Brazil, but it continues to be a top performer for us.

No, go ahead John. I was just taking the follow-up on that.

Exactly, on a 12.5, if we could think.

Of course, yes. So, the perspective you need is, first of all, Brazil had a really strong cash position coming into this. We don't -- on a regular basis Brazil is very self sufficient in terms of its funding needs. So when we made that $12.5 million investment into the business, I think that what we're seeing is that, that can carry them over for some time. Now, as they begin the process of reopening their dining rooms. Well, we're hopeful that they'll have enough cash to tide them over for the foreseeable future. It really just depends, though, as you get later into the year, kind of how that plays out in terms of the reopening of the dining rooms, and the stabilization of their sales performance.

Our next question comes from Jeff Farmer with Gordon Haskett. Please proceed with your question.

You did touch on it. And I appreciate that it's been only a couple weeks. But for those 23 Outback locations that had been open to in restaurant dining since sometime in late-April. Have you seen those same-store sales steadily improved? Have you seen increased demand for that that limited seating capacity, any color that you could provide there to sort of paint a picture for us for what it's like when these restaurants reopen?

The restaurants are very popular. We're meeting the local guidelines. The dining rooms are filling up and the sales are sustaining. And we'll take those learnings like I mentioned earlier to other states. But we're bouncing the need for safety for our customers and our employees with the demand for our restaurants. And also we want to make sure we keep that was off-premises gains that we've enjoyed. So that's what we're trying to do, Jeff, as we balance these different things and we'll see how the states unfold, more states are opening up we'll see what happens. But it's too early to say other states right now. But I can tell you what we've seen so far in Georgia.

And then just as a follow up to that. So Texas and Florida I think are both limited to the 25% capacity. What criteria are needs to be met at the state level? Before that capacity can be eased to, let's say 50% limitation? Are you guys aware of all that is that information out there yet?

It's not out there yet. We're aware of very safe to keep in touch with state all the time as far as what their plans are, will comply with that. But we can't speak to the state's Jeff as to what their plans are. We're just staying on top of it as best as we can.

Thank you. Our next question comes from the line of Alex Slagle with Jefferies. Please proceed with your question.

Thanks. Hope everyone is doing well, for the restaurants that have reopened at this point. Have the operating hours been similar to before and what are you seeing? I guess when are you seeing most of the demand? And I'm just wondering how that's playing out if you envision enough demand that you'll start to fill out the shorter period some?

It's similar. There's nothing really different per se. I think the biggest thing is just managing to the local laws and local compliance and running it to our best of our abilities. But it's similar what you'd normally see.

Okay. And transitioning customers from the wait area to the cars seems to make and interesting solve. What are the customers saying about that? And what have the waits been like?

They have appreciated it. They appreciated the steps we've taken as a company. And we've gotten very, very good feedback. They've also appreciated the fact that we've reopened. And the waits vary by restaurant. Some restaurants have -- you could be seated right away and other ones have very, very long wait. So, it really depends on the location and what the certain situation is.

And more importantly, the customers have shown a willingness to wait.

Yes.

Thank you. Our next question comes from line of Matthew DiFrisco with Guggenheim. Please proceed with your question.

Thank you. I have two questions. One specifically to the new debt spend and/or how you redid the covenants, and you said 1Q '21 is when you sort of have to come back to those covenants kicking in? Can you just sort of give us a range of where we should think that -- I guess it's an EBITDA on an LTM basis would be what you'd have to adhere to? Not assume -- obviously, it's something that the cash flow is going to gradually come back, return positive, sometimes through '20, but not a lot of debt reduction. What would be the EBITDA that you would have to or range of EBITDA that you'd have to get to fulfill that covenant?

I'll give you the covenant perspective first. So the way will work is that you take the Q1 EBITDA performance of the Company in 2021. You multiply it by four with some adjustments for seasonality because Q1obviously is going to tie a seasonality quarter of the year in terms of sales and profit performance. And then you then the ratio in Q1 is a 5.5 times to 1 ratio between net debt to EBITDA, and then you would go to Q2, and then that steps down to 5.5 times to 1. Q3 it goes down to our original covenant, which would be 4.5 times to 1. So, the expectation would be either Q3 of next year, you're back in compliance with the original covenants. Now, as you progress through the year, you just add a quarter of EBITDA and then you multiply it by, whatever ratio. So in Q2, I take Q1 EBITDA plus Q2 EBITDA add them together and multiply it by two to get an annualized view, and then you test it against that. So that's really how the covenant will progress. And again, we felt really comfortable that we'll be in compliance with that as we get to Q1.

Excellence, that's very helpful. And then lots been talked about, but I think when people talk about 25% capacity coming back to the dining room. How should we think about that? I mean, in your numbers, it looks like just the raw math, you're coming in a little less than that 25% in those stores, as you get sort of muscle memory of how the consumers coming in and using you with that 25% capacity. What type of work have you done to try and maybe get above 25% sales lift potentially from that new capacity? Is there a way to redo the model, redo the point of sale or treat faster speed of service? Or get more creative where maybe 25% capacity of the dining room could? Is there an environment where 25% of the capacity of dining room could be -- exceed 25% of the sales lift in theory?

Yes, I think one of the things we've talked about his simplification of our operations, simplification of our menu, working on efficiencies, getting table terms. We want our guests to be comfortable, right. They're happy to be back. So we've got to understand that as well. But I think the table turns in that environment in a clean safe environment is going to be important. And as I mentioned earlier, maintain that off-premises business between third-party delivery, our own delivery network and carryout. So that's going to be a crucial part of it as well. We can't forget about that. But I think, Matt, the table turn piece would be the area that we've concentrated on the most.

And then, any change to the menu when you reopen? I assume you've slimmed the menu a little bit for the off-premise only model, how are you bringing back the model to the menu back to full menu or not? And that's my last question, thank you.

We have slimmed down for off-premises and as far as menu plans in the future, stay tuned. We spent a lot of time on that thinking about that. This was an opportunity for us. And just stay tuned for different competitive reasons, we don't want to get into it, but we thought a lot about it.

Our next question comes from line of Brian Vaccaro with Raymond James. Please proceed with your question.

Thanks to the convertible debt offering. Chris, what the cost for you to answer the call spread? And net-net, what are the expected total proceeds do you expect to bring in on the note offer?

Yes, the call spread cost about $17 million, so the net proceeds would be after fees and expenses about $175 million.

Okay, great. And then, I appreciate the weekly sales color that you provided on the U.S. business. Would you be willing to provide an update on the Brazil conference in recent weeks?

Happy to talk about it, but we haven't provide any detail. But it's been, the growth has been very similar to the U.S., as people have adapted to the new model. I'm saying growth from where they started. And then we've had to, they don't really have a carryout business down there. So we've had to teach the Brazilian consumer carryout and I think the team's on a nice job on that. So we're seeing the same kind of gains down there from where they started in Brazil we've seen in the U.S.

Much lower base though with starting point.

Yes.

And then last one for me, I just want to ask about the franchise side of the business. Could you could you give a status update on temporary closures either domestically or internationally and maybe some perspective on the franchisee health?

Franchisee health varied franchise partner. We've had just a handful of closures, not many. And we've been working with our U.S. franchise partners, very closely. And I think they'll come out of this, very strong. But we've got a great relationship with them. Internationally, we have also worked closely with our partners. We've been very pleased with some of the leading indicators coming out of Asia. Korea is doing well for instance, a positive same-store sales growth. So, we will watch that obviously learn from that. So, Brian verify franchisee a handful of closures and we'll continue to monitor what's going on over in Asia.

Our next question comes from the line of Andrew Strelzik with BMO Capital Markets. Please proceed with your question.

You mentioned that you're sharing across the system, some of the learnings from the early states, I'm wondering if you could share with us what some of those learnings are? That's number one. And number two, as you're reopening the dining rooms, and maybe restart the advertising at some point. Curious how you're thinking about using value as a call to action? You've moved away from just going on over the last couple years. Is that something that maybe you would use more tactically, kind of going forward in this environment? Thanks.

As far as learning go, it's all about first and foremost safety and health of our customers and our employees. I think we're doing a great job there and what we can do to maintain that, we share that, we talked earlier about table turns. We're sharing what some of them new items are and what people are buying. Talking about how we preserve our off-premises business. So all those things, we have different trade-offs and things. So, all those things are being talked about. As far as marketing going forward, the digital investments we've made will really pay off. We continue to use that in -- excuse me how hard you push value and things will be very aware of what's going on in the marketplace. But I think for competitive reasons, we prefer not to talk about that right now. But digital base will be a big part of it will invest behind marketing where it makes sense. And we built a strong digital capability will continue to improve that. And we'll watch what the value equation looks like for the consumer.

Our next question comes from line of Brett Levy with MKM Partners. Please proceed with your question.

As we're starting to see, even if it's a dim one, a light on the other side of the horizon, how are you thinking about what pace of rolling things back in, your ability to not just manage for today or digital, but step up the investments on that and on the off-premise? And what would you need to see before you can start to feel that you're comfortable with your liquidity position to start paying down debt to start layering in some incremental costs? And also, where do you think you have the best opportunities to further streamline the business, not just at the unit level, but also at the corporate? Thank you.

Look, we raised the funds that we talked about earlier to make sure we had the liquidity, which we felt very good about all along, but also make sure we had the dry powder to go on the offensive when we have to. And so, investing behind our off-premises business investing behind our restaurants, there'll be a big part of it. And we'll see the sales come back in the restaurants. Chris and team will do a great job managing our cash flow and our debt pay downs. And we'll toggle that back and forth based on what we're seeing in the marketplace. That's the first thing. Secondly, we've learned a lot during this process. We've learned a lot about digital. We've learned a lot about our off-premise business. We've learned a lot about how we can go to market as a company, and how we think about our menus going forward. We're going to use all of those learnings to make us an even stronger company as we move forward in 2021 and beyond. That includes our cost structure above the restaurants. We want to continue to examine that. The team did a great job in February, identifying some opportunities. I think we'll look at how the workflows in the Restaurant Support Center, who does the work, how it comes together. And we'll continue to examine that. But we've got a really strong restaurant support center that's doing a great job managing and working with our restaurants. But we'll continue to look at our cost structure as any company would, as we move forward.

Okay. Would you be able to share where your dining rewards membership is this quarter?

Yes, its north to $10 million.

And it is grown during this time, so it's great to see. That's been a powerful program for us and when we can leverage in the future.

And is there anything you can share about just their customer behavior versus the traditional customer behavior? And I'll just jump up the queue and have it.

They're very loyal and we love them and we're going to continue to work with them, we're going to continue to innovate that program. And much like -- I'm just thankful we made the investments in delivery, dine rewards, digital over the years to help make this happen because it has paid off for us in big ways and something we're going to leverage going forward.

Thank you. Our next question comes from line of Sharon Zackfia with William Blair. Please proceed with your question.

Hi, good morning, and congratulations on the off-premises growth, I mean, it's been really phenomenal to watch from the outside. I guess I'm curious.

Thanks.

You're welcome. I guess I'm curious as to whether or not you've seen any kind of regional call outs and how quick the rebound has been? And I think a couple of your brands may have introduced off-premises during this timeframe. I'm wondering, if they're going to keep off-premises going forward? And then lastly, as you think about these locations reopening for the dining room, I don't know if you mentioned whether or not you've been able to keep the off-premises as the dining rooms have been reopening in terms of the kind of volume increases you've seen.

Sure. For our brands, we talked a lot about Outback and things Carrabba's on off-premises, but Bonefish and Fleming's have taken it from virtually nothing. Bonefish had some Flemington had zero. I just had to shout out -- give a shout out to those teams. Because we know now that we have an off-premises business, especially at Bonefish that we didn't think we had before. The meal bundles and things have been a big success. I really think that's an opportunity for us going forward. And so, sharing as we open up the dining rooms, we want to keep as much of this off-premises business as possible. And we want to be truly multichannel, whether you come to us in the restaurant, whether you come for carryout whether you come from our delivery, or you come from third-party delivery. So, I think at Bonefish we've seen it. We'll see what happens at Fleming's. I mean, the team has done a really nice job there as well. We'll see if that business especially on the carryout side is something that's possible as restaurants reopen. So, our goal is to continue to grow that off-premises business as dining rooms open up to keep as much as a share as possible and innovate around it.

And then on the geographic side, I guess, as you would expect, there is a correlation to how sales are impacted to the level of exposure to COVID in the area. So, the sales is performing stronger than, say, the Northeast or the Mid-Atlantic.

Our next question comes from line of Gregory Francfort with Bank of America.

Just the first one is on rent. I guess are you -- the comments on cash burn, are you paying full rent? Is that where you stand and you're trying to figure out, how to mitigate that over time? I just was trying to maybe understand what the comments were. And then in the states that have reopened, in terms of trying to figure out cannibalization of dine into the off-premise business, any quantification there on kind of the early signs of what you're seeing in terms of that big pickup and off-premises is kind of holding and the dine is incremental or any quantification will be great? Thank you.

Yes, we are holding a very large share of the in the state of the open -- very large share of the off-premise business. And that's why the cops have responded like they have even in the 25% dine-in type environment. So, again, like I've mentioned a few times on this call. Our goal is to build off that off-premises business as we move forward, as dining rooms reopen. I'll turn over Chris on the red piece.

Yes, obviously with 900 landlords, every conversation is unique. And as I said, we are having constructive conversations with landlords about deferrals and abatements. I'm not going to for competitive reasons get into how much is deferred and how much has abated and when those things play in. I guess the perspective I was giving though is, as it relates to our burn rate of $6 million to $8 million, we have built an assumption into that, that we are paying full rent into the burn rate just so for your edification, there's no, well, how much is in that burn rate of rent. Full rent is in the burn rate, but there are ongoing conversations about deferrals. And the landlord's have been very receptive as we indicated.

Maybe just one other question on labor, I think you haven't furloughed any team members. I guess, for anybody who -- does that mean that all the restaurants are shut down, you're paying some portion of wages to every single team member. And then or ones that they shut their dine-in and then I guess, as you've tried to get customer or labor back into the store, has there been any challenges in terms of executing that?

Yes, I think you've kind of answered the question you ask is, yes, we have been keeping our rosters full and our people paid because when the restaurants initially opened back up, we've got a full train, highly engaged team to come back, with very little minimal training and hiring costs. And that's been extremely important to us as we open back up. And I think people will look at what we've done, how we've navigated the crisis, but look at for the long-term, how we did it. And having these people available and ready to go and highly engaged is really going to help us as we move forward.

Our next question comes from line of Jason. I'm sorry, Jared Garber with Goldman Sachs. Please proceed with your question.

It's Jared on for Katie. Historically, you guys have talked about, some thinking about, some relocations, especially for Outback. Obviously, maybe some of that's on pause given the current crisis, but just wondering if longer term, are you rethinking that strategy, given the strength in the off-premise business that you've seen recently and maybe that's a way to mitigate some of those lower quality locations without fully moving them? Thanks.

Yes, I mean, the additional piece of off-premises has helped us really think through what the restaurants going to look like in the future. And it'll help us in a relocation program, it'll help us with our economics, it'll help us with our restaurant volumes, and give us even more optionality to go forward, as we optimize our asset base. It's tied back -- it's early in the call about going on the offensive as we go forward, and really think through our asset base and relocations. Because before all this happened, we know that we were getting really strong returns on the relocations. Now, when you add layer in the new learning, when you layer in off-premises opportunities, we can really think through in a very creative way how we take our asset base going forward.

Thank you. Ladies and gentlemen, this concludes our question-and-answer session. I'll turn the floor back Mr. Deno for any final comments.

Well, we appreciate everybody joining us on the call today. I hope everybody safe and healthy as we go forward. We look forward to updating you on the portfolio on our next earnings call this summer. Thanks a lot.

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.