Good morning ladies and gentlemen. Welcome to the Good Times Restaurants, Inc. Fiscal 2015 Second Quarter Earnings Call. As a reminder, a part of today's discussion will include forward-looking statements within the meaning of the Federal Securities Laws. These statements are commonly identified by words such as "anticipate," "continue," "plan," "expect," "intend," "should," "will," and other terms with similar meanings. These statements include but will not be limited to statements that reflect the company's current expectations with respect to the macroeconomic and competitive environment. The financial conditions of the company, results of operations, plans, objectives, future performance including the company's initiatives and strategy, sales growth, operating margins, cost, expenses, deployment of capital, restaurant development and our remodels, new market development, franchise development, and other expectations within the course of this call. Although the company believes the assumptions upon which preliminary or initial results, financial information and forward-looking statements are based are reasonable as of today's date, these forward-looking statements are not guarantees of future performance and therefore investors should not place undue reliance on them. Also these statements are based on facts known and expected as of the date of this conference call, and the company undertakes no obligation to update these statements to reflect the events or circumstances that might arise after this call. Participants on today's call should refer to the Company's Form 10-K A and other filings with the SEC for a more detailed discussion of risk, uncertainties, and other factors that could impact the Company's future operating results and financial conditions. The Company has posted its second quarter press release and supplemental financial information related to the quarter's results on its website at www.goodtimesburgers.com in the Investors section. And now I would like to turn the call over to Mr. Boyd Hoback, President and CEO of Good Times. Please go ahead, sir.

Thank you, Mellory, and thanks everybody for joining us again this morning. With me today are Sue Knutson, our Controller and Scott LeFever, our Chief Operating Officer for Good Times. And joining by phone this morning is Jim Zielke, our new CFO that joined us this month and who we immediately sent down to Charlotte to help with the integration of our acquisition of Bad Daddy's International. So first of all I would like to welcome Jim to the call and you will begin to hear more from him in future earnings calls. And as you hopefully have been able to glean from our filings and prior calls Sue Knutson is a top notch controller and certainly on top of every aspect of our financials. That won't change, so Jim will provide us with additional capacity to accelerate and effectively manage our growth for both concepts while being also street facing with good communication and transparency for our investors. So, after we deliver our prepared remarks today, we will certainly be available for questions and answers. And I will spend a little time discussing the implications of the acquisition of Bad Daddy's International and the offering that closed concurrently last week. So, we continue to see both good same-store sales growth and flow through to profit on the sales at Good Times. Our same-store sales increased 8.3% on top of last year's increase of 17.8% which was also on top of double-digit in the prior year. So, our sales increase continues to be the result of both transaction growth, some growth in our average check driven by menu mix shifts, and also moderate price increases which Sue will outline here in just a minute. Our second fiscal quarter is our worst quarter seasonally so we certainly expect our store level…

Thanks Boyd. With all the exciting news on Bad Daddy's we continue to deliver good results on our core concept at Good Times even during what is our worst seasonal quarter of the year. We are continuing to drive our fresh, all natural, handcrafted positioning deeper and deeper while we focus on continuous improvement in our store level execution on quality, speed, and friendly service. We just completed our first ever television campaign focused solely on our Breakfast Burritos and we saw our breakfast sales peaked at just under 10% with year-over-year growth and the average number of burritos sold by over 20% in March and April. We rolled out our all natural, nitrate free bacon in all stores as of May 1st which completes the all natural story for all of our proteins beef, chicken, and bacon. We are supporting the introduction of all natural bacon with television, PR, and social media advertising through July. We finished April up 6.5% on our same store sales and now that the rains have stopped in May, are hopeful that we can finish the third quarter similarly on top of the two year same store stack of 28%. As I mentioned in our first quarter call we had unusual spikes in bacon, dairy produce, and overall cost that began to abate later in the first quarter and they have remained lower in the second quarter including some moderation in beef costs. As a result we are running close to prior year levels in our cost of sales at Good Times. We implemented a small one step price increase in tandem with our roll out of all natural bacon which will cover our increased cost on that product. Our beef cost peaked in October and November and are stabilized but we aren't planning…

Thank you, Scott. Boyd already covered the highlights from our earnings release but I’ll point out a few additional things. Good Times same stores sales increased of 8.3% was comprised of 2.2% in transaction growth, approximately 4.7% in pricing, and 1.4% in other components of our average check. Both Good Times and Bad Daddy’s cost of sales declined sequentially from our first quarter due to lower commodity cost, improved systems and process at Bad Daddy’s, and with Good Times down over 2% and Bad Daddy’s down over 1%. Labor cost remains slightly elevated at Bad Daddy’s due to extra management that we are carrying for our new stores planned in 2015. All four General Managers for the new stores have completed their training programs and are filing positions in our existing restaurants. However, with the new restaurant sales performance and the operating margin at these stores we still delivered 14.3% restaurant level operating margin for the quarter. Good Times continues to see good leverage on all of its operating costs with labor cost down 1 percentage of sales from last year during the quarter and other fixed and semi variable cost also down as a percentage of sales which resulted in 160 basis point improvement in the restaurant level operating profit margin for the quarter. In our operating prospectus, we show that the four Bad Daddy’s restaurants that we acquired from BDI, that have been opened more than 15 months had average sales of 2.7 million and a restaurant level operating margin of 18.6% last year. We continue to expect and model the Bad Daddy’s concept at approximately 2.4 million to 2.5 million in sales with restaurant level operating margin from 15% to 17%. We are running slightly lower cost of sales in Colorado as compared to the North Carolina…

Thank you, Sue. Now that we have completed the acquisition of BDI, our story is certainly clear and cleaner and is a pure growth story. So disciplined site selection, hiring good people, not over growing our operating capabilities, and maintaining the level of economic models we believe should deliver significant shareholder value over the coming years as we perform on those. Well some sites may take a bit longer to mature as Sue said, we’ve been more than encouraged by the recent new restaurant openings and so as we model the Bad Daddy’s, its outstanding at 2.4 million to 2.5 million in sales and is exceptional at higher sales and I think we are beginning to believe that there is as much opportunity to open stores at higher than 2.5 million targeted level, than below that as we continue to refine the model with everything from enclosed patios, rooftop bars, or site selection model, and as we continue to innovate with the concept where we are obviously real excited about Bad Daddy’s. So appreciate your time with us today, with that Operator we’ll open the call for questions.

[Operator Instructions]. And our first question comes from the line of Will Slabaugh with Stephens, Inc. Your line is open. Please go ahead.

Hi, thanks guys. This is Billy on for Will, and congrats on a good quarter. Just a couple from me. Can you talk about the ultimate runway for breakfast to Good Times and what that would look like, and obviously you’ve seen success there here but wondering if you potentially had a long-term goal for where you wanted that to be as far as percent of sales and then what it would take to get there, would that be just more raising awareness with your customers or will it be more driven by say menu expansion and more products?

I’ll take the first crack and let Scott jump in. When we first rolled breakfast it immediately went to over 7% of sales. Recently we got it over to 9%. I think we would like to be able to see that day part get into double digits. I mean I believe Taco Bell has gotten theirs up to the 6% to 7% range with all that they have been putting forth that effort and obviously the millions of dollars they are spending on advertising. We’re reluctant to just push sales mix and the reason being is that Scott and Nick have developed a really labor efficient model with the way we are doing breakfast right now. So doing 8% to 9% mix is extremely profitable as we begin to expand that menu it has a significant impact on that labor model. And so we do have some other things in test, we have some new products that we are looking at. We would like to continue to grow that day part. Even though it’s only gone up by a point or two as a percentage of mix what's significant is that breakfast has maintained that mix and actually grown as our overall same store sales have grown. So where we’ve grown double-digit over the last two years stacked on each other, breakfast has continued to grow commensurate with that and actually increased as a percentage of mix on top of that growth. So as Scott mentioned where this last TV campaign where we actually increased our overall breakfast and burritos sales by over 20%, so we’ll continue to put some media behind that and we have got some other product innovation, anything else.

No, I think that’s accurate. I don’t think we are going to jump into new menu items very quickly. We are going to evaluate it against our labor model and our food cost. The singular offering of breakfast Burritos has really proven to be very efficient.

Right, thank you, and just one quick follow up if I could, speaking to the site selection I realized that Good Times is obviously going to take on a slower growth profile and it seems to me there are some obvious advantage of keeping that concept geographically closed for brand recognition purposes but with Bad Daddy’s is your intention to tap out most of say the Colorado market or the North Carolina market before expanding to adjacent states or do you think that the brand is broadly appealing enough and you might find better returns by jumping in say bigger cities and states that aren't necessarily connected to your home base.

The answer to that is two sided. On the one hand from a site selection standpoint we think there is still lots of opportunity in Colorado and North Carolina. This is not media driven concept, this is not a market penetration concept. It's really trade area driven. With just the three that we have in Colorado we certainly think we can continue to build here and without cannibalizing existing stores. I think some market awareness will probably help the concept. We saw that in Raleigh, the first store when they opened their second store in Raleigh, the first store immediately popped up 25% to 30%. But more importantly I think is the distribution footprint and we want to continue to grow most of our growth in 2016 will be in Colorado and North Carolina. But after that then we will begin to grow outside of that. What we don’t plan on doing it was hop scotching and jumping over to states that are outside our distribution footprint. We want to try and maintain the same back door costs and with reasonable distributors it’s really important that we stay within that footprint. So that leads us to kind of drawing a circle around Colorado and around North Carolina and growing concentrically from both of those markets. Even if we do franchise selectively, we will certainly look at some new markets I think with that and we’ll see how these new stores perform if we think there is a better opportunity to do higher volume in a brand new market then we will certainly take the tact but I think for 2016 we’ve got our pipeline and our handfuls with Colorado and North Carolina.

Great, thanks guys. Congrats again.

Thank you.

Thank you. Our next question comes from Alex Fuhrman with Craig-Hallum Capital. Your line is open. Please go ahead.

Great, thank you for taking my question. Boyd certainly appreciate the comments in the prepared remarks about moving towards more transparency with investors. In that spirit could you tell us your April comps, I think you gave us January comps on the last conference call, I would love to hear what April was tracking so far this year?

We mentioned them in the prepared remarks, we were up 6.5% in April on Good Times same store sales comps and not the most ideal weather for the month. We started out May with horrible weather but if we can maintain that mid single-digit growth on top of the 28% two year stack for this quarter we’d be thrilled with that.

Yes, but I don’t disagree with that, you are not -- I am just kind of looking at the comps you guys put up a pretty strong double-digit comp in 2014, now it seems like same-store sales are definitely coming in a little bit now that you are lapping the legalization of marijuana in Colorado. I mean do you expect them to continue to come in, is there any concern that comps could revert back to pre-legalization levels over the next year or two or you are just kind to looking to maintain that new normal and kind of grow low to mid single-digits of the current base here?

We’re looking to grow low to mid single-digits off the current base. We don’t think there was any risk of reverting back. I think it’s really more the general state with the Colorado economy that’s extremely healthy. So there has been summarizing of the tide and there has also been our deepening of the ramp position that I think is gaining distraction. So our plan is to continue to build on where we are.

And then just thinking about the guidance you gave on the Bad Daddy’s side and that run rate revenue wise where you expect to be at the end of the year, is that including the results consolidated in for that 23% owned store, or is that going to be a below the line adjustment?

No, we’re going to consolidate that store since we have management control of that and then there will be a controlling interest expense and minority interest expense that’s taken out for their share of the net income from that store. So we are consolidating that from a revenue standpoint. So below the operating margin level there will be a reduction for that non-controlling interest.

Okay thank you.

Thank you.

Thank you. Our next question comes from the line of Greg McKinley from Dougherty. Your line is open. Please go ahead.

Yes, thank you. Boyd you already talked about your Bad Daddy’s development plans in Colorado and North Carolina focus, I guess first question can you give us a sense for will those be roughly equal contributors to how you think unit growth will develop over the next 12 to 24 months? And then secondly you mentioned the possibility of some franchise opportunities overtime with Bad Daddy’s, I guess how do you guys view pursuing that avenue, do you feel like you need to show franchisees additional stores opening at these strong AUVs or has that already been proven enough and now it’s more targeting the right partners if you could help us understand that?

I don’t think the issue on franchising is really proving the concept out anymore. I think the issue is what’s the smartest way for us to build the most value over the coming years and I think as a high quality controlled company on growth story, both in terms of valuation that we would get from that as well as capturing the unit economic model and deploying our own capital end of that, at least in the very near-term is the smartest way to go. That said and we do have franchise interest but we’ve intentionally been not signing those and pursuing that. The larger issue I think is Bad Daddy’s is the kind of concept that is right for franchising. Franchising is innovative -- in a way kind of itself kind of its own business. It is real easy to sign up a few franchises but we need to be able to support them and have the platform and the resources in place to either go down the franchising path or not and not dabble in it. So, right now I think the near-term as we want to focus on company owned growth we will then continue to have dialog with some really high quality, high capacity franchise groups. But we are not really -- I don’t want to overstate that because I don’t want to position this as a franchise growth story. We don’t see it that way. We see it kind of incidental to our company owned growth plan.

Okay, thank you and then in terms of infrastructure, so you have recently added a CFO, you mentioned bringing in additional HR and Real Estate capabilities. Where do you feel your team is at now to support little higher growth rates for these concepts now in two different markets instead of one, what are the key areas you need to make sure are setup.

You know it’s really from an infrastructure standpoint and its really at the pure operating level. So we’ve got so much and we got our 4 GMs for these next four stores in Colorado already through their training program and getting seasoning in our existing stores. And we see padding the North Carolina based as an advantage because it gives us a larger platform not only for the existing market but then to be able to develop opening teams and training teams and all the things that’s required for opening new stores. So we’re going to be putting in District Managers and in that level of supervision in both Colorado and North Carolina that will be our next step. And we mentioned the Director of HR and Training will be I think our next key hire. The number of people that we will be putting in place grows pretty dramatically. So, over this last year we have been working on more platform tools. We have got good video training in place, we have got a great very tight eight week training program for management. We have got store level systems that weren’t in place that are now in place. So, I think we have got the functional platform ready to go. It is really now the people side and so, most of our focus will be at the supervision level, at the unit level, and at the training level.

Okay, thank you. And then just two follow-up questions, you mentioned taking 1% price increase with your bacon roll out, where are we at now with menu price and how does that sort of anniversary over the next couple of quarters? And then secondly I wondered if you could comment on Cherry Creek because it seems like there has been some meaningful strides there, what would you attribute that to?

Our cumulative price increase so far including this 1% is about 3.5 so far. We took three very small price increases kind of which has been our history and we haven’t seen any transaction erosion from that. We don’t anticipate much more of any price for the balance of this year. So that's 3.5 and maybe a small one later in the year. But that 3.5 is on top of last year's 4.4. So, we took one right at the beginning of this fiscal year, we took a smaller one in January, and then we are taking this 1% now. So the cumulative effect of those three on a weighted basis is 3.5. On Cherry Creek it continues to grow nicely, it is cash flowing at the unit level which is great. The construction is still going on around that store so we anticipate longer-term that that will continue just to get better and better. It is interesting, the first Raleigh store kind of had a similar pattern and we had opened up slower I think than expected and then going in second year just took off and we are seeing some of that same thing from Cherry Creek. I think as the Bad Daddy's awareness gets higher in the market it also helps the Cherry Creek store. I will tell you it is the top rated store on the review sites in terms of reopen and that sort of thing, so we know we are executing well. And I think that is helping to grow that volume.

Great, thank you.

Thank you, Greg

Thank you, and our next question comes from Mark Smith with Feltl and Company. Your line is open. Please go ahead.

Hey guys, it is [Ryan] [ph] on for Mark Smith. Wondering if you could just talk a little bit about the delta in the restaurant economics between that Cherry Creek location in Colorado and maybe some of the lower performing restaurants out there and maybe what you have learned about what is generating those stronger returns going forward for future openings?

Yeah, I think the biggest thing that we have learned is really from a site selection standpoint and I talked a lot about this on our road show. Cherry Creek tends to be more of an urban location and what we are seeing is it does the same weekday volume as the other stores. What it doesn’t have is the huge spike that we have seen on Friday, Saturday, Sunday in the other suburban stores that have other larger upscale retail co-tenancy, movie theaters, and that sort of thing. What we will do, if we are doing $5000 on Monday, Tuesday, Wednesday we will jump up and do $15,000 on a Friday and Saturday. Cherry Creek does jump from $5000 to $8000 but it doesn’t jump from $5000 to $15,000 and I think that has been very valuable learning. So, everything we have got in the pipeline and if you look at the top performing stores they tend to have -- they tend to not be real urban locations but tend to be a little bit more suburban, kind of upper middle income suburban. I think we also may be overshot the marked demographically in Cherry Creek a little bit. It is the highest demographic population in residential in the entire state of Colorado. And what we are finding at our higher volume stores in these suburban locations is that I think the sweet spot for Bad Daddy's is not necessarily super high income but good solid upper middle income. And we are taking significant share from casual theme, commoditized casual theme as opposed to these urban markets where there is honestly quite a few really cool restaurant concepts and a lot of choices. While on the suburban locations, they don’t have those same choices, and so I think the Bad Daddy's concept is really resonating strongly there. So, long winded answer but I think fundamentally it is a site selection issue.

Thank you, that is incredibly helpful. And then just one more, I am sorry to beat the dead horse on talking about franchise in here but, I know it is a long ways out but just wondering if you thought about it at all, kind of what that high quality franchising partner might look like in terms of sites or anything operationally there?

Yeah, I guess when I talk about high quality franchisee in this concept particularly I think, we would want somebody that knows their market very well from a real estate standpoint and has good relationships with developers. We would want somebody that has a good solid infrastructure in place, good full service experience I think it is going to be key. Bad Daddy's is very different both in terms of its culture, its employee profile, and operating QSR. So, I think we would look for those things. I think also then the market and the development area also is very important. Certainly well capitalized, we would have no problem whatsoever going out and franchising Bad Daddy's on a one off basis or a smaller basis to folks that want to get involved in the concept. But I think it will be important that we profile good experienced, well capitalized franchisees.

Alright, thanks so much. Look forward to sampling the breakfast food [indiscernible].

Thanks Mark.

[Operator Instructions]. And I am showing no further questions at this time. Ladies and gentlemen, thank you for participating in today’s conference. This concludes today's program and you may all disconnect. Everyone have a great day.