Good day, ladies and gentlemen, and welcome to the Domino's Pizza Inc. Fourth Quarter Year End 2018 Earnings Webcast. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder today's program is being recorded. And now I'd like to introduce your host for today's program Tim McIntyre, EVP, Communications IR & Legislative Affairs. Please go ahead, sir.

Thank you, Jonathan, and hello everyone. Thanks for joining us. Today's call will highlight the results of our fourth quarter and full year results for 2018. The call will feature commentary from Chief Executive Officer, Rich Allison; and Chief Financial Officer, Jeff Lawrence. This call is primarily for our investor audience, so I kindly ask that all members of the media and others to be in a listen-only mode. A friendly reminder to our analysts, we have asked you to stick to one question on this call, because we want to give all 20 or so of you the chance to participate. We will provide each of you with the opportunity for more in-depth one-on-one calls later today. In the event that any forward-looking statements are made, I do refer you to the safe harbor statement you can find in this morning's release, the 8-K and the 10-K. In addition, please refer to the 8-K to find disclosures and reconciliations of non-GAAP financial measures that may be used on today's call. And with that, I'd like to turn the call over to CFO, Jeff Lawrence.

Thank you, Tim, and good morning everyone. We are pleased to report our results for the fourth quarter and full year fiscal 2018. During the quarter, we continued to build on the positive results we posted during the first three quarters of the year and we delivered strong results for our shareholders. We continue to lead the broader restaurant industry with 31 straight quarters of positive U.S. comparable sales and 100 consecutive quarters of positive international comps. We also continue to increase our store count at a healthy pace as we opened 560 net new stores in Q4. Our diluted EPS was $2.62, which is an increase of 25.4% over the prior year quarter. This increase primarily resulted from strong operational results and a lower effective tax rate. With that, let's take a closer look at the financial results for Q4. Global retail sales grew 6.5% in the quarter pressured by a stronger dollar. When excluding the negative impact of foreign currency, global retail sales grew by 9.5%. This global retail sales growth was driven by increases in same-store sales and the average number of stores opened during the quarter. Same-store sales for the U.S. grew 5.6% lapping a prior year increase of 4.2%. And same-store sales for our international division grew 2.4% rolling a prior year increase of 2.5%. Breaking down the U.S. comp, our franchise business was up 5.7% while our Company-owned stores were up 3.6%. Both increases were driven primarily by higher order counts in addition to some ticket growth as consumers continue to respond positively to our overall brand experience. Our Piece of the Pie loyalty program once again contributed meaningfully to our traffic gains. Our international comp for the quarter was driven entirely by order growth. During the quarter, all of our geographic regions were…

Thanks, Jeff and good morning everyone, I'm pleased with what was a terrific fourth quarter, one that capped another outstanding year for Domino's. Our results continue to outpace the industry and our franchisees across the globe continue to make me extremely proud. I plan to keep my commentary rather brief today, mostly due to the fact that we recently held our Annual Investor Day, which was a great opportunity to communicate, detail around our strategy and my thoughts on my first six months, as CEO of this tremendous brand. We certainly hope you found it to be helpful, filled with substance and time well spent. The updates and concepts we discussed centered around one thing, what matters. Today and going forward, I'm going to frame up our quarterly performance around these elements. Areas in metrics that I am most focused on as we execute the long-term strategy designed to help us achieve our goal of becoming the pizza industry's dominant number one. So let's revisit what matters. Retail sales growth matters, and once again we delivered. Our global retail sales growth reflected a strong balance, across our US and international businesses. For both businesses in Q4, our growth reflected a healthy blend of unit growth and traffic driven same-store sales. Looking first at our US business, double-digit retail sales growth in Q4 was comprised of a very healthy and order count driven 5.6% comp and 125 net new units. The fourth quarter marked our 31st consecutive quarter of positive US same-store sales growth and capped very strong top line performance in 2018, above our three to five year outlook range. And continually driven by focus, fundamentals and execution. I'm so proud of our US franchisees and teams who continue to lead the Domino's system. Turning now to International, we delivered…

[Operator Instructions] Our first question comes from the line of Peter Saleh from BTIG. Your question please.

Hey, guys. Great, thanks. I just wanted to ask about the international, real quick on, I think you said the comp growth has been driven primarily by order growth. What's the dynamic going on the check are you seeing your franchisees internationally discount to drive some of that traffic or just any commentary on the check would be helpful.

Sure. Pete it's Rich. On the check what we are consistently trying to do as a brand across the globe is to stay focused on value. We talk about it a lot in the US with 599 and 799, but we're also focused on it in our international markets as well. And the approach that our growth minded master franchisees are taking is really around driving transactions, driving order count as opposed to taking price increases over time. So what you saw in 2018 was really that continued focus to make sure that we're driving growth, the right way.

Great. And then just domestically, the comp growth 1% was still a little bit below what we were anticipating. Did you see any deterioration in delivery times or any shift in the consumer behavior in the fourth quarter versus prior or was this pretty much in line with your expectations?

We're really happy with the comp growth in the US in the fourth quarter. As stated earlier, it's a traffic driven comp which is exactly what we like to see with the business really healthy across all dimensions.

Hi everybody this is Tim. I'd like to reiterate, we really would like you to stick to just one question on this call, please.

Yes. Once again, ladies and gentlemen, please limit yourself to one question, you may get back in the queue as time allows. Our next question comes from the line of Karen Holthouse from Goldman Sachs. Your question please.

So, you previously talked about loyalty programs is something that come with sort of a natural pathway, is been one of the reasons, you expanded it outside of just digital transaction. Should we expanded points for Pie's promotion as an indication, that half-life was like starting to become more apparent in the existing program, and you needed a new jump start, can you just sort of put that in context of overall performance and confidence in the loyalty program.

Sure. Karen, the loyalty program has continued to be a significant driver of comps for us, since its launched now, little over gosh, three years ago now. And as we mentioned at Investor Day in January, we passed the mark of 20 million active users. The points for Pie's program is a terrific enhancement to that program and our loyalty program does have a half-life, and our approach was not to wait until we hit hours, but to continue to bring more news and to bring more interesting ways for consumers to sign-on with our program and get actively involved in it. And I'll remind folks on the call that when we structured the loyalty program Our Piece of the Pie rewards back in 2015. It was done with the mind towards driving transactions, and everything about the program structure and the enhancements that we've made to it over time are all about making sure that we drive transactions and frequency with our customer base.

Thank you. Our next question comes from the line of Matthew DiFrisco from Guggenheim Securities. Your question please.

Thank you. With respect to the comp and sort of that comment, I think about the calendar shift that you made. Is there anything else we should consider given the Easter comes later, so Lent, the timing of Lent occurring a little later. Does that play into the quarterly comp at all or some things to factor in? And then also with the comp assumption pricing calendar shift in a lot of our wages went up in certain states. Is that another factor to think about in 1Q, just a higher pricing domestically?

Yeah, Matt, it's Jeff. We'll primarily enter this for Q4 since we're in Q1 right now and we can't report on that. But what I can tell you is, it did hit us by about 0.5 point, the calendar shift. We'll get most of that back, obviously in Q1. As far as any kind of seasonality or quarter versus quarter start in 2019, not really that worried about it, that we're executing and putting up the numbers we want that'll be rounding here type of stuff.

Thank you. Our next question comes from the line of David Tarantino from Baird. Your question please.

Hi, good morning. My question is on the domestic comp trends, and I know when you add back the calendar issue, the comp Q4 was pretty similar to what you had in Q3. But the comparison was quite a bit lower. So when you look at maybe at on a -- two-year stack basis, it does look like the business decelerated but I guess my question is that the way you look at it? Did the business decelerate and how does that change your thinking or does not change your thinking about your 3 to 6 comp target as you enter 2019?

Hi David, it's Rich. The way I look at it is that the business did not decelerate from 2017 to 2018. We look at the full fiscal year 2017 versus 2018, looking at global retail sales, our US business, we were up 11.1% in fiscal 2017 and we were up 11.2% in fiscal 2018. If you took a look at the fourth quarter, we were up 7.6% in 2017, and we were up 10.2% in 2018. So we feel very good about our retail sales growth across the business, which is really the key metric that we take a look at. And we were very pleased with the comp in the fourth quarter for a couple of reasons. One, is that, it was driven by a very healthy dose of order count, growth -- transaction growth. And secondly, really, nicely within the range of our long-term expectations.

Thank you. Our next question comes from the line of Sara Senatore from Bernstein. Your question please.

Hi. Thanks. Just about the company-operated comps and that spread, I know it's a very small part of your system, company stores in the US, either bear greater sort of splits or/are more affected by aggregators. And then, can you say anything about that sort of what appears to be kind of on a one and two year basis of widening gap for the company stores and whether that has any kind of portend for the system overall?

Yes, in the -- Sara, in the company-owned stores as you know, those are, those are concentrated in eight markets and you're primarily more urban type markets. So, certainly, you will see a little more impact from splits because all of the openings that we have in our corporate store business are going to be realignments of territories. And to the extent that there is an aggregator impact, certainly that's the areas where those folks are more focused. So we don't -- we don't see any concerns in the quarter from our corporate store growth. We feel very good about the growth and profitability in that business, but the characteristics are little more skewed toward the urban setting.

Thank you. Your next question comes from the line of John Glass from Morgan Stanley. Your question please.

Hi, thanks, good morning. You've talked about the split impact in the -- anticipated split impact in the US. I know you report your international comps without the split impact. What would that be -- maybe in the fourth quarter and if you trend it that overtime or is the impact of splits increasing over time internationally? Decreasing or is it been stable as we look at that business over in the last couple of years?

You know, John, we shared with you back at Investor Day, the point to point and a half on the US side of the business. We don't have a similar number to share with you on the international side, it's really going to, because it's really going to vary country by country, depending upon, what state of the growth curve that we happen to be in, in that particular country. And some of our markets where we are more penetrated today, you may see a little bit more of an impact there and other markets where we've got a lot of more -- a lot more white space left to fill, you're going to see less impact. But if we come back to our three to five year outlook for same-store sales growth of 3% to 6%, it takes into account, the fact that we will take some headwind on that due to the impact of in the splits. And as we talked about in our Investor Day, this is an investment that we're quite happy as a brand to make. And our franchisees have been quite happy to make, because it's necessary to drive the overall retail sales growth and overall profitability in the business, primarily at the franchisee level as well as a franchise.

Thank you. Our next question comes from the line of Gregory Francfort from Bank of America Merrill Lynch. Your question please.

Hey, guys. So just, I wanted to ask about international and maybe one, could you just tell me how many conversions you had in the quarter? And then just on the comps, I thought they were little softer than I was expecting. And I'm, -- because I'm curious what that might have been attributed to, and if the count came in below your expectations and kind of, if there is any regionality there?

Hi, Greg. We're not going to report specifically on the number of converted units the -- the conversion that was primarily happening in the fourth quarter was the continued conversion of Hallo Pizza in Germany and we've been very pleased with the progress that DPE is making there, and you could probably refer to their release from about 36 hours ago and get more of the details around that. With respect to the international comp, there is certainly we would love to see that number a bit higher. It will just be fully transparent with you on that, because our trends over the longer-term has certainly been in a better place than where we were in the fourth quarter. That said, we are always going to have some ups and downs in the various markets around the world. In the fourth quarter we were softer in a few key markets in Europe and a few key markets in the Pacific region specifically. But when I take a look at the underlying health of those markets, we have strong market share positions, we have great unit economics and we've got strong management teams in place. And even with the little bit of weakness in the fourth quarter comp, when we step back and look at our retail sales growth, the product of that comp, and the unit growth that we're seeing -- I'm still quite pleased with the -- with the growth trajectory in the business.

Thank you. Our next question comes from the line of Will Slabaugh from Stephens, Inc. Your question please.

Hey all, thanks for taking my questions. This is actually for [indiscernible] for Will this morning. I was just hoping you could out the comp a little bit more in 4Q. You said in your prepared remarks, the same-store sales growth included some ticket growth. I'm just curious if that check growth is a little bit more than we are accustomed to seeing and what was the driver of that? Thanks.

Yes, it's Jeff. Real good comp in the fourth quarter for the US business, in addition to the retail sales growth, did a five, six, the majority of that was traffic. We did get a decent amount of what I would call smart ticket. So, using that -- using the analytics capabilities we have working with our franchisees to really figure out where the places where we can kind of grow ticket, but what I'll tell you, it wasn't a really nearly raised prices across the board, our franchisees aren't doing that. They're doing it more precision based using the analytics, and it's a good balance is what I would tell you. But, again primarily it was traffic with a little bit of what I'd call smart ticket sprinkled in there.

Thank you. Our next question comes from the line of Chris O'Cull from Stifel. Your question please.

Yeah, thanks. I had a follow-up regarding the corporate stores and I guess this applies to the franchise stores as well. But are there any opportunities to mitigate some of the cost pressures that you're seeing, especially around the labor to kind of slow the margin pressure we are seeing at stores?

Yes, this is Jeff. Within the store environment in the US and in many countries around the world, it can be challenging on multiple line items, and labor is certainly one of them. When you look at the -- our corporate store margins for the year, they were pressured pretty significantly on labor rate, now the operator of that business, great teams and the market that we're in, did a really nice job of generating some efficiencies, but it wasn't enough to overcome the increase in labor rate and labor rates really two-forms. One is government-mandated labor rate increases, which of course we follow, but also just that the fact that the economy as you know, is white hot right now, in the US, everybody has got a job and sometimes the economics of the situation demand that labor rates go up. So really, really don't have an opinion or care as to why it goes up, but we need to do it, to continue to drive those efficiencies. And there are opportunities there, I think for us to continue to chase that, we're investing more in technology inside the store, we certainly done a great job with consumer facing, the point of sale, things like that. But we're really taking a fresh look at how we can use technology kind of behind the counter for labor scheduling for our corporate stores, sharing best practices to the extent that the franchisees who obviously make their own decisions in this regard, can learn from that. But yes, always opportunity in margin, labor, all of the big opportunity. And I think as we go forward, driving the volume, driving that traffic will give us a better chance, an increase in dollar profit there. But, it is difficult environment with labor, but we just got to continue to work our way out of that.

Chris, just a couple of things to add to what Jeff was just describing in terms of some of our near-term effort. The real game changer over time, on labor, is going to have to come from our efforts to fortress our markets. The most expensive thing that we do is take a pizza from point A to point B. And as we look forward over time to reducing the radius of these delivery areas, in addition to driving incremental sales for household, which we've talked about in the past, we are also looking to reduce the cost per delivery and it just makes sense. Of course, the shorter the distance, the shorter the drive time, getting that driver out from the store to the customer and back to the store, the lower the labor costs for that specific delivery. And as we see wages rising in cities around the country, this is the key lever over the coming years in terms of reducing that delivery costs. To go alongside a lot of the things as Jeff described that we're trying to do around, being smarter about our scheduling and how we think about using technology to make the flow of product from the store out to the customer more efficient.

Thank you. Our next question comes from the line of John Ivankoe from JPMorgan. Your question please.

Thank you very much. I know you guys have expressed your satisfaction with your fourth quarter comps in the US, but I'm wondering if you know think execution is optimal at the store level using in-store employees and optimal in terms of availability of delivery drivers. Obviously I have heard now and I've heard before the comments about reducing delivery stands, but are you currently staffed the way that you want that you want to be or their execution issues that are popping up in various markets, that might be constraining comps from what they otherwise would be?

John, on execution we're never satisfied. We are as fast as we've ever been in getting out to the customer and we believe we're better than the competition, and competition, old and new, but we're never satisfied there. So the short answer is, yes, we need to get better, both in terms of the average time that it takes us to get pizza to our customers and also with the variability around those times. And that's something that we're working on each and every day. The driver labor market and availability of drivers certainly plays a part in that. And as Jeff said, it is a very tight labor market right now. So we've got to make sure and our franchisees have got to make sure that Domino's Pizza is the best place for those drivers to work when they have many more choices today, than they had five years ago. So what does that mean for us, well, the most important thing in terms of driver wages and satisfaction is how many deliveries per hour to these drivers get. That drives the compensation. And when we look at the places around the country where our franchisees have in, and built out their store networks to fortress where we cut those delivery zones, down from nine minutes down to six minutes or five minutes, we find that our drivers are making more money in turnover in those places is less. So it's not a short-term play, it's a long-term play, but we are very much focused on it, John, and we wanted to be a great place to work now, and also to create opportunities for our drivers of today to become the franchisees of tomorrow, 90% plus of our franchisees in the US started-off delivering pizzas or started-off answering the phones in our stores. And one of the really terrific things that is happening right now with the resurgence in store growth in the US, is that we are developing new franchisees at a faster pace than we have in many years. And so we're attracting drivers, not only for the near term wages, but also for those that have the vision around the longer-term opportunity to potentially be a franchise owner at Domino's Pizza. We think we've got a terrific value proposition for them.

Thank you. Our next question comes from the line of Jeremy Scott from Mizuho. Your question please.

Thank you. Just wanted to ask about your international store growth. Did that, first did that come in about as expected. And then secondly, as we look forward into 2019 and beyond should we be thinking about a step up in that development of some of your newer markets start to ramp up. And then separately, you talked about the G&A investments in your international teams where exactly is that going? And as you start to become a bit more dispersed in your geographical mix, does that mean you have to broaden out your investment in G&A?

So, Jeremy on the store growth we were very pleased with the fourth quarter, the international store growth. As we talked about on some of our calls earlier in the year, store growth got-off to a slower start than we wanted to see in the earlier part of the year. And our expectation at that time was that, it would pick up over the course of the year and we were pleasantly, very pleased to see that in fact happened. As we look out going forward, I remain very confident in our 6% to 8% outlook for store growth. And I'd say that because the fundamentals of our four-wall economics in the business are still very solid with a payback in the international business of around three years on average with a number of our markets, even much faster than that. One of the things that happened in 2018, it also gives us confidence, is that we really seeing an acceleration in the brick markets in particular. And Russia, China, India, all had terrific years in 2018 store growth. And we in Brazil we're very optimistic going forward. We got new ownership in the market, there building up the great foundation as the previous master franchisee put in place. So feel good about the three to five-year outlook and I feel very positive about our aspirational goal of 25,000 total stores globally by the end of 2025. Your second question, I think you snack a second one there was around G&A. And we're investing in our international business really to help our franchisees continue to grow. And one of the things that we've talked a little bit about over the last several quarters post the leadership change that we adhere here at Domino's is we've been building some centers of excellence in our business and that's something that, our Chief Operating Officer, Russell Weiner is working hard on every day and the thought behind that is to take some of the capabilities that have driven our US business and make them more available to our international markets. And one of the areas there is around our data analytics and our decision support capabilities. And so we're going to be looking over the years to come to take some of the analytics, some of the data driven, decision making that have helped us to be so successful in US and port that out to more of our international markets.

Thank you. Our next question comes from the line of Dennis Geiger from UBS, your question please.

Thanks for the question. Wanted to ask about market share in the quarter and specifically wondering if you saw any shift in the areas where you took share specifically looking at the Independence relative to the larger brands, whether you're taking any incremental amount from the larger brands. And then just perhaps if on the carryout side you saw greater gains there given the increased focus over the last couple of quarters. Thanks.

Sure. The short answer is, we continue to gain market share at a very healthy clip across the business and that is, -- that's both in our US business and in our international businesses, in both of those businesses we grew at a very healthy multiple of the overall market growth rate and one of the things that we shared back in January at our Investor Day if you look even back across the last four years, more than 100% of the transaction growth in the US pizza category is being driven by Domino's. You pull Domino's out of the, -- if you pull Domino's out of the overall market, you would see that their transaction declines when you add up all the rest of the players. Now that share shift comes from a number of different places and frankly, we're fairly agnostic about whether we take share from the larger players or from some of the smaller and medium-sized players over time. Across the different elements of our business, we continue to grow our share both in delivery and in the carryout -- in the carryout business. When we take a look at it, even as the number one player overall now, we still have significant market share growth potential, given the fragmented nature of the category.

Thank you. Our next question comes from the line of Jeffrey Bernstein from Barclays. Your question please.

Great. Thank you. First, Rich, just want to compliment you on your television ads, it's nice to see you on a more regular basis.

Thanks, Jeff.

Sure. Separately, just on the international front and I recognize that, it's tough to make broad brush comments, when you're talking about so many different countries. But, the fact that the comp did come in slightly below the long-term range, it seems like it's the lowest in many years. Does it make the 3% to 6% guidance for the next multiple years look a little aggressive, just wondering, especially when you commented that, you had a couple of weaker markets, but in reality, all markets are positive. So it doesn't seem like there is a big headwind that you're all of a sudden going to be able to correct, seems like it's more just a slow and steady across pretty much all of your markets. So I'm just wondering how you think about or why you're confident in such a re-acceleration or why not perhaps lower that long-term guidance, since we all know that I guess the total retail sales growth that you focus on?

Yes, Jeff, you know, as I mentioned earlier on the call -- we weren’t altogether that thrilled with the fourth quarter comp in the international business, but it doesn't diminish our confidence in our ability and our master franchisees ability to continue to drive same-store sales growth across international, over the longer-range outlook in that 3% to 6% range. And the fourth quarter number, the 2.4% is really it's a blend. We had some markets, while all regions were positive, we certainly had some markets that were negative. And we had some markets that were wildly positive, then when we take a look at the potential, particularly as we break down the largest international markets, that really drive the business and drive the overall number. We and our master franchisees see opportunities to continue to perform better. In some cases, the short-term gets pressured by some macroeconomic factors. In some cases, our short-term is not where we want it to be, because, maybe we weren't executing at the level that we needed to. So we don't make any excuses for it, but we see, we're still quite confident in the opportunity going forward.

Thank you. Our next question comes from the line of Jon Tower from Wells Fargo. Your question please.

Great. Thanks. Just real quick, following up on that franchise -- international franchise side, the absolute unit closures on the international side was the highest, I think that I have on record here. So, I was curious if there is anything going on perhaps, there is something related to conversions. And then, just secondly on the U.S., you had mentioned the loyalty program it's been in place for about three years. And you mentioned, it's been a significant driver of traffic. So can you perhaps, breakdown how that program is driving same-store sales meaning? Are you seeing it from new member acquisition or is it building frequency with existing active members as well as building check with those members? Thanks.

So you should [knock] into there also, get sneaky from time-to-time. So, on the international closures, there were some closures in there associated with conversions. Whenever you do a conversion, there is always some overlap. And so, you would find, you would find some closures in there. We also had a few of our smaller markets, where we had a few more closures than we might typically do. And in those cases, places where we've got some unprofitable units or maybe some units that were opened, maybe not in exactly the right place. And it's the right thing to do, to close a unit, we hate to do it. But if it's the right thing for the overall health of that market, consistent with the long-term growth goals, then that's something that we're willing to take in the short-term. To your second question around loyalty, and the answer there is kind of yes and yes. We're continuing to drive sales and engagement with existing loyalty members, while we continue to bring new members into our program. And the way we share the data with you when we talk about 20 million members, those are active members. So that is -- when we put somebody in that bucket, that is a customer that has ordered through our loyalty program within the last six months. And we continue to see terrific engagement from those that joined us three years ago, and those that have come on board in 2018.

Thank you. Our next question comes from the line of Andrew Charles from Cowen & Company. Your question please.

Thank you. When you look at the 500 basis points of deterioration in domestic to your trends from 3Q to 4Q, in both 2017 and 2018. Both of which include a 50 basis points headwind from the calendar shift. But do you think there is a new element of seasonality in the business that you believe is emerging? And if so, what you think is driving that?

Yeah, this is Jeff. The short answer is no, no more seasonality to the business than as ever been in there. Still a simple business, it's one where you just got to go out and execute every day. But now, no new seasonality or any impacts from that.

Thank you. Our next question comes from the line of Alton Stump from Longbow Research. Your question please.

Good morning. Just wanted to ask about the 1% to 1.5% impact, you guys talked about in fortressing of 100 comp. I think by my count this was the seventh year in a row that you've seen your overall unit growth accelerate in the U.S. If that does continue to accelerate, is there any concern about in the kind of 1 to 1.5 debt becoming a bigger number? Going forward, or is it, am I not thinking about that correctly if we’re -- if we, to continue to see it was unit growth expand in coming years?

Yes. So when we -- when we look at unit growth going forward and we engage in conversations with our franchisees about building new stores, we absolutely take into account what type of impact, we might have on the comps in the existing stores and then the way we look at new unit openings is we take a look at the expected cash-on-cash return in that new units, but we also take a look at the expected payback across the overall cluster. So as an example, if there is an opportunity to carve out some territory and open a new store. The cash-on-cash return on that store might be 2.5 years. The cash-on-cash return on the cluster that might be four years, 4.5 years. We look at this, and each individual circumstance. What I just share with you is, just an example. But we are working with the franchisee and making sure that the new store makes sense, but also the impact on the cluster makes sense because we, in the franchisees look at it as a near-term investment giving up a little bit of comp in those existing stores to drive the long-term growth of their business and their profitability and one of the things that, we are most excited about from 2018. 2018 is our franchisees' profitability and I'm going to talk about that in two dimensions. The things we thing, we talk about a lot you is the $137,000 to $140,000 per unit in franchisee profitability. But what's -- what we also think about a lot is the overall franchisee enterprise profitability. So our average franchisee today now has almost seven stores and what that means if you run your math. Is that an average franchisee is now generating over $900,000 in EBITDA and that has been growing rapidly over the last several years. So we're focused on unit level economics and we're very focused on franchisee economics.

Thank you. This does conclude the question-and-answer session of today's program. I'd like to hand the program back to Rich Allison for any further remarks.

Well, thanks everyone. We appreciate your time today and we look forward to discussing our first quarter 2019 results on Wednesday, April 24.

Thank you, ladies and gentlemen for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.