Greetings and welcome to Shake Shack First Quarter 2020 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being record. I will now turn the conference over to your host, Mr. Rik Powell, SVP of Finance. Please go ahead.

Thank you, Hector, and good evening everybody. Joining me for Shake Shack's 2020 first quarter conference call is our CEO, Randy Garutti; and President and CFO, Tara Comonte. During today’s call, we will discuss non-GAAP financial measures, which we believe can be useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. Reconciliations to comparable GAAP measures are available in our earnings release and the appendix to our supplemental materials. Some of today’s statements may be forward-looking and actual results may differ materially due to a number of risks and uncertainties, including those discussed in our annual report on Form 10-K filed on February 24, 2020 and current reports on Form 8-K filed on March 17th and April 17th, 2020 respectively. Any forward-looking statements represent our views only as of today and we assume no obligation to update any forward-looking statements if our views change. By now, you should have access to our first quarter 2020 earnings release, which can be found at investor.shakeshack.com in the News section. And additionally, we have posted our first quarter 2020 supplemental earnings materials, which can be found in the Events & Presentations section on our site, or as an exhibit to our 8-K for the quarter. In light of the ongoing environment, our supplemental materials also include certain financial information related to the current quarter. I'll now turn the call over to Randy.

Thanks Rik and good evening everyone. We hope you, your families, and our entire Shake Shack community are all staying safe and healthy during this crisis. I've had the privilege of leading this company through many challenging and many incredible moments. But I think we'd all agree this has been an unprecedented test for our world and for our teams. Our message across the company has been consistent to lead with hope, while acting on reality, and to make the necessary choices today to ensure our strength and growth continue for years to come. We're confident we've increasingly taken those steps since this crisis began. We're pivoting the business now to be sure Shake Shack captures the opportunity to evolve into an even stronger company as we come out the other side. Today, we'll briefly talk about Q1, which prior to the impacts of the COVID-19 outbreak was in line with our expectations and previous guidance. We'll focus more on Shake Shack today, specifically our teams and the important positive momentum of our operating models and digital initiatives. I want to begin by talking about where the company is right now nearly halfway through our second quarter. Sales have been steadily increasing every week from their challenging lowest point at the end of March and last week of our third period, the week before -- the week ending March 25th, we experienced numerous Shack closures, greatly reduced operating hours, and sales in the comp base averaging down 73% across the portfolio compared with the same period last year. However, since that point, and as we've shared the supplemental deck provided, each week we've seen encouraging and steady increases in both same-Shack sales and total sales nationwide, driven by growth in our own digital channels, the expansion of integrated delivery partnerships,…

Thanks and good afternoon everyone. Firstly, I'd like to reiterate how proud we all are of our teams in the Shacks and our home office team supporting our Shack as we continue to work through these very challenging and uncertain times. It's been incredible to watch the speed and energy with which everyone in the company has come together to navigate through this crisis, and to ensure we come out the other side even stronger than when we went in. In light of the circumstances, I won't go through the details of the first quarter, but will focus more on how we were performing before the severe impact of COVID-19 hit fully during March, and then get some additional color on current quarter-to-date, progress and trends. Our priority during COVID-19 has been to keep our teams and guests safe; first and foremost, while keeping all Shacks open wherever we can do so. From a financial perspective, we've seen a material impact to sales performance and a number of new costs into the business. I'll talk more about some of those in a moment. We remain focused on preserving cash, yet strategically continuing to invest in key areas of the business that will solidify opposition of strength and ensure we're well-positioned to move quickly back to our long-term growth agenda, as market conditions continue to improve. Prior to experiencing the full impacts of the COVID-19 outbreak, our performance in the first two periods of the year was in line with our expectations. The same-Shack sales down approximately 2% as sales started to steeply decline following the COVID-19 outbreak, March same-Shack sales were down approximately 29% resulting in total comp for the first quarter being down 12.8% and total revenue for the first quarter increasing 8% to $143.1 million. As at the…

Thanks, Tara. I want to take this opportunity to just say thank you for all of you for joining us today. In the midst of this crisis, our responsibility and commitment to our communities has never been more important. And our teams just keep stepping up to that challenge. Shacks around the country have been providing countless meals for hospital workers, first responders, firefighters, humane societies, food banks, and more as daily examples of our core values in the light and hospitality. While we work through this extremely challenging time, I could not be more thankful for our Shack and home office teams their dedication to keeping our Shack operated. I couldn't be more grateful to our guests for their continued trust and support. During this time, we are working hard to take the lessons we're learning now and bring them into our business plans moving forward, ensuring we’ve come out even stronger on the other side, more prepared for anything that can come our way. Remember, Shake Shack was born as a community gathering place in Madison Square Park in New York City. You can bet that when the day comes, where friends, families, co-workers, travelers and everyone in our communities chooses to gather again, Shake Shack will remain a place they choose to do so. And with that operator, you can go ahead and open the line for questions.

Thank you. At this time, we'll be conducting a question-and-answer session. [Operator Instructions] Your first question comes from line of Sharon Zackfia with William Blair. Please proceed with your question.

[Technical Difficulty] of that roughly, you're getting through the app and through the Shack website. And what I'm really trying to get at is how much information are you getting on your customers at this point? And how does that kind of flesh in with any ideas you might have about loyalty, either imminently or in the feature?

Sharon?

Yes.

Hey, Sharon, I'm sorry, at the beginning of your question, you were muted. Could you -- I'm sorry; we only caught about the last 10 seconds. I'm sorry. Am I missing the question?

That's okay. This is the joy of everyone working remotely.

Yes. We are on the New World.

Yes. So, congratulations on the 80% digital. I guess what I'm curious about is what percent of that are you getting information for either the customer either via the app or your website? And kind of along with that, how does that inform what you're learning about your customers? And any potential thoughts on loyalty layering into that platform?

Absolutely. So look, I think it's really exciting to see how quickly our tools that were built for a much lower percentage of sales have grown, and very literally keeping us in business. So we're excited about that. We haven't -- people can check out as a guest, they can check out with full information. When they check out the full information, obviously, we get quite a bit of data that we only use to connect with them if they're willing and if they want to be a part of that. So the data is rich. The connection is rich. And we're really excited about what this means, because as you know, from the industry and we expect this ourselves, those guests tend to be sticky. They tend to hang in there with you. And I think especially during this time, guest that are experiencing Shake Shack, it's been like coming home. The amount of social media posting we've seen, when people get their Goldbelly pack at home, they cook their Shack Burger kit. It's a strange time. And when you can connect with those things that are comfortable, it really matters. As we look at loyalty and other things down the road, we're going to continue the test various things. We've seen some good success with various promos we have our delivery partnerships in this -- over this last month. And we're going to begin to be able to do more and more of that as we continue to invest and build in our tools. We've got a lot more built in that too. These digital tools have a lot of work to be done. But that's what the investment is and we are really excited about what it's going to mean for us in the future.

Thank you.

Your next question comes from the line of Nicole Miller with Piper Sandler. Please proceed with your question.

Thank you. And thanks for a great update this afternoon. One question would be the Goldbelly partnership. I mean, that was just really fun. We experienced it on our end. Just wondering, it's clearly aligned with the DNA of supporting the community. How much of it was novelty? Could it be permanent? And even if it's not, what did you learn?

It's a great question, Nicole. Thank you for hanging in there with us. I think what we've learned is there is an incredible demand for Shake Shack all around the country. One of the powerful things about a thing like Goldbelly is, it starts to tell you where people order, right. And it's a way for us over time to maybe even learn about real estate decisions, how to see the market, where there's different demand that we may or may not even know. And we're going to be listening and learning through that. Look, I don't think it's going to be a material part of our business anytime soon. We certainly want to be back took and Shack burgers for you, Shacks more than having you have it at home, although, we love that for the moment, but we'll be keeping on. I think it's going to give us an opportunity about other products down the road. And who knows, who knows what this could mean. I also just want to follow-up on one thing from the previous question too. As we look at our digital channels, one of the cool ways where people are experiencing Shake Shack right now is when you do go to the Shack, we have a QR code outside the window where you can scan that, the menu pops up, you're immediately in our channel, and you can order. So you don't even have to wait online. You don't even have to -- you can have fully contactless ordering. And it's just another great way you can connect with people. So lots of fun things both on new channels like Goldbelly and our own.

Your next question comes from the line of Katherine Fogertey with Goldman Sachs. Please proceed with your question.

Great. Thank you. Actually, one thing of clarification, Tara, you kind of went out a little bit when you're talking about the weekly cash burn and the assumptions you're making there. So if you could kind of get back into that point. But really the question that I wanted to ask was about the pipeline and site selection, the Shack Track seems super interesting and wondering if that changes the way in a post-COVID world that you think about site selection, and if you anticipate there being more sites or different sites opening up that maybe Shake Shack might look a little different, post-COVID then the more unique larger scale units that we've seen so far? Thank you.

Yes. Hey, Katie. Yes, I apologize. I'm not sure what happened at that first part of the cash burn discussion. So what I said was at our current sales levels coming off the last week, our cash burn is now at about $800,000 a week. So that's obviously an improvement from the business update we posted a couple weeks ago. And that assumes full cash rent payments of about $800,000 a week. And so we're pleased with that progress and we expect that to continue to improve as sales gradually recover.

And Katie on the on the on the Shack Track, I think it's going to be fun to learn. Look, we've got to try this out. We've got to do it in different places. I think one of the things we've learned in this time is that and as we look ahead. Hey, more than ever, we want to build community gathering places. I truly believe that the world will gather again. We shouldn't do it in the same way right now. But as time passes, I believe we will be thirsty to do that, as a society as Human beings people want to gather with other human beings. So we're going to keep building those. We're going to keep building really special architecture and design as we have from the beginning. That's the very thing that has always set Shake Shack apart. And in this time, we're really looking forward to building more of those. In addition to that, we want to make those Shacks and others, even more accessible, even more convenient, no matter how you want to order. And we can do that and have people continue to gather over the long-term. There are Shacks, like we have one that's nearly built in University Village in Seattle. That's a great community gathering place. It's a beautiful design. And we're going to add one of those Shack Track windows to it, right and I think it'll be an exciting way to do it. We have a couple other Shacks where they would never intended as a drive thru, but now we think we might be able to punch a hole in the side of the building, create a lane and allow you to have pre-ordered on our channels and drive up and pick it up. We may even be able to set that up for delivery couriers. All of that in the near term is to separate people, to give people space and a lot of crowd control, over the long-term to try to give you however you want your shack with convenience. So I think to the direct part of your question, I think it will open up new opportunities for us in real estate. I think look we have never had more, cash on our balance sheet than we have right now today. That's a tremendous position for a company to be in during this time. And we intend to use that wisely when the time is right and capitalize on what we expect will be a change retail environment. And I think there will be companies like ours that can expect to be even more coveted than we were before by developers and landlords to capture the best pieces of real estate out there.

Your next question comes from line of Lauren Silberman with Credit Suisse. Please proceed with your question.

Hi, thanks. Just a quick follow-up on the prior question. To what extent do you think the existing Shack will be able to be retrofitted for the new enhancements? And how could the new design potentially impact investment costs? And then just the question on the recent comp improvement, what do you think are the primary drivers of the improvement in trends and anything you can share about what you're seeing on the consumer behavior side? And then just to clarify the comp closed store?

Sure. Comp excludes closed stores. Let's start with the comp then. So yes, we closed stores of the 2017 that has been -- those are out. In the comp base, we've seen gradual improvement every week, for the last six weeks, as we've shown since the bottom occurred towards the end of March. I think it's really been a few things. There's been what I believe is has been tremendous efforts by our team to quickly and radically alter the way that we operate today. For those drive up, pickups, curbside and keeping everyone out of the dining room. I think it's extraordinary what the team's done. And I think people are getting used to that. And I think diners and guests are looking around and saying, I want to eat out. And when I do, I need to trust that brand. I need it to be safe in the way that we have done that, I believe has gained us a lot of points in our community. Additionally, the digital initiatives, seeing the ability of our app and web channels to grow and be the leader of our sales right now as well as the integrated partnerships that we've continued to add with new delivery companies. It's giving people the opportunity to experience Shake Shack during this time, quite a bit. When it comes to the shacks, how many will be able to directly benefit from a shack track kind of setup. It's hard to say, we're really reviewing those now. There will be some that'll be really obvious, will be something that'll really look and feel like a normal shack, but what we'll be working towards is as best as possible in a current design, to have separate areas to have windows and shelves that can be accessed separately. Just to keep people as much as possible separate. This will be tough, Shake Shack are crowded places, we're going to be working carefully to disperse those crowds, while still trying to maintain the best we can. I don't expect it as a material increase in a new shack build. We do expect driving some level of CapEx as we look to do this at current shacks. But I'm going to do it quickly. We're going to do it when -- where we can and there'll be lots of things we're going to learn by no means that we figured this out yet. But it's something we believe in and something we're excited to test at a few places and get it going.

Your next question comes from line of Jake Bartlett with SunTrust. Please proceed with your question.

Great. Thanks for taking the question. Your mind is around on restaurant level margins, and maybe if you can clarify, Tara, you said that the restaurant margins were 15% in March, despite same-store sales being down 29%. May just -- surprised by that level, if you could confirm that and just, you know, at the current levels of things same-store sales, what is the restaurant level margins look like? Or maybe said in another way, what is the breakeven given how the stores are being operated right now?

Yes. I mean, hi, Jake. So I mean, the team has did a great job, really across the company, and particularly in the shacks of responding as quickly as they possibly could, as it related to cost within the shacks, and variable costs and fees costs and labor costs, trying to react as quickly as possible to those week on week sales trends that I talked about. So, I think hats off to them for moving as quickly as they did. And we obviously saw a meaningful impact to margins in the quarter and with that kind of a sales drop off. But when it comes to looking forward, and where we are now, I would say you sort of made the pivot yourself from shack-level operating margin to cash burn, really, we're very focused on that cash burn number, first and foremost. And that's where we'll be looking for it to continue to improve as sales come back. Ultimately, of course, with the intent of getting back to the high margin business that we were before COVID-19 hits. But that's not going to happen tomorrow, and there's going to be a path to get there. And different costs will start coming back into businesses different -- coming back into the business at different times. Obviously, as Randy mentioned, we were really pleased to be bringing back stuff and team members back into those Shacks as sales recover. So we've got a bunch of inefficiencies and just extra costs in the operating models right now. It's really, really hard to be clear. And as we reopened dining rooms, and that's not necessarily going to get any easier in the short-term, as we reopened dining rooms under such sort of restrictive -- in such a restricted environment. So, I think cash burn is the key area of focus. And as of today here we're not giving any forward looking statements as it relates to that, or any breakeven points on the call today. But pleased with the -- pleased with the progression so far in the last few weeks and with sales continuing to increase, you know, looking forward to that continuing to get better. But also, you know, we'll also start to spend a little bit more to as we alluded to. We're really excited to get some of these digital investments and digital strategies back on track, after sort of moment of pause, and start, you know, getting this business back on the front foot for coming out the other side.

Your next question comes from one of John Glass with Morgan Stanley. Please proceed with your question.

Thanks very much. And thank thanks for all the detail around sales and cost. When I look at your sales declines, even outside of New York City sales are down 35% to 40%, which in a way surprises me just given us a limited service brand. We've seen some others, even without drive-throughs have lessened or doubt declines in sales. Is there another way to cut that data to look at like the suburban stores and you get away from like tourist areas, areas which are being more impacted by traffic some other way to help understand, if there's a differentiation either way people are just not using your brand differently? Or is it just the geographies and locations you're in that causes more significant sales declines?

Well, john, I think, there's so many variations within that. And it's the right question, but the most heavily impacted are the deepest urban environments, right, New York City and urban stores shacks and many other places around the country. The hard part, when you really try to break it down is, look, there's some -- there's many malls where we're either closed, because we're inside or open, but the mall is closed, right? So, it's hard to say, well, a mall or a suburban shack is doing okay. I think Shake Shack real estate has been its strength, right? And there's no doubt that in times like this, we're not a brand with 2,000 units around the country that has a wildly dispersed portfolio. We have just 167 company operated check. They're all in really good location. Really good locations are deeply impacted by this moment. And I think it's just a little bit harder said, but generally, you're right to say that suburban kind of does a little bit better during this time, because you can access it more easily. But it's -- we've seen some fascinating trends and it really is -- it really is a learning moment, and it's teaching us a lot different kinds of real estate opportunities that we have today. And we'll have in the future as things -- these things return. But look, I think Shake Shack being a little more impacted than your average, fast casual or certainly then the QSR, just because of the kind of real estate we have. We have zero drive-through official driver-throughs, right. So working on it, learn a lot and the good news is each one of those regions has slowly picked up every single week.

Your next question comes from line over John Ivankoe with JPMorgan. Please proceed with your question.

Hi. Thank you very much, everyone as well. The first is a clarification. I think Randy you said that some stores are actually up year-over-year. So, I mean, could you explain like what the characteristics of are of those stores? And secondly, having $247 million of cash is a lot of money given, what your cash burn is? And what their CapEx will be likely for the next several years? Are you beginning to think about other strategic or non-Shake Shack opportunities now that you have a truly fortress balance sheet?

Yes. We really do have I mean, at that level, the most cash, we've ever had in this company ever, in the history of this company is over $90 million. We now have nearly $250 million. That is a truly fortress balance sheet to withstand anything, no matter how long this takes. We believe we can withstand it. And I do think it creates tremendous opportunity for us. First and foremost, John, on our own channels to continue to build and we believe the -- the truly opportunistic in our growth moving forward. Now, we got to get past this thing. We're not going to get over our skis, we're going to make sure that we preserve the cash we have and so that we can do that. We have no current plans for anything outside of building our own shacks. We've got a big country and a big world out there and we want to do that, but you never know. And, liquidity was the number one goal over this last two months, we've achieved that. We're really, really happy about that In terms of the shacks that are up, it's funny. First of all, there's not that many, as you can see in the numbers. So let's be real. But the ones that are interesting, they tend to be those shacks that are where you can clearly see where stay at home would help. Some of the ones that are easily accessible via car, via drive-up and via where people are being right now, throughout their kind of work, look it up. So, let's just say that, Midtown, Manhattan is not one of them. If it gives you an example, right? So we -- it would be opposite of that, that is seeing more of the strength right now. But we think -- we think they'll all continue to -- we hope continue to come back if the trends continue.

Your next question comes from line of Jeffrey Bernstein with Barclays. Please proceed with your questions.

Thank you very much. Just a question as we think about the reopening to come. I mean, obviously, you're primarily do a lot of dine in business. So, that's a big opportunity for you. I'm just wondering, if you've given any thought or can share anything in terms of your thoughts on timing and maybe how the strategy changes in terms of social distancing like you said, you're a gathering place, but doesn't necessarily fit well with that type of environment? So any thoughts around profitability that'll come out with, these capacity constraints or maybe you've already opened some of the dining rooms in terms of any learnings you can share in terms of the improved comp or the risk of losing pickup at the expense of the dining being reopened anything, it would be great? Thank you.

Thank you. So, the only place in the world where dining rooms have reopened has been in mainland China, in Shanghai, in Hong Kong and in Korea. Those are severely limited dining rooms, and each country has their own methods. We've learned a lot from our partners overseas. And I think, we're taking a lot of that to our ops teams here. So domestically, there are zero Shacks that our dining room open and we haven't announced yet when or how exactly we will do that. But we are we are watching closely and we're making sure it can be done safely. You've obviously seen regions like Texas, Georgia, and some others begin to open and restaurants being some being aggressive, some being more cautious. We're going to take the more cautious route. And when we do, you'll see a lot of blocked off or removed tables, you'll see a lot of space between any guests, you'll see the line very clearly delineated with space in between, and you'll see pick up areas as spread out as possible. And by the way, you'll see our staff as spread out as possible for their own safety. So, it's going to take time. We have to work with throttles right now. There is no good reason to just start to try to do all of the sales that these Shacks once did. That is not the safe thing. And it's what we need to be careful about that. That said, our teams are being incredibly entrepreneurial and as aggressive as they can to get back to sales that that the opportunity is there. So, I think I think we're going to continue to encourage people. My hope is that, whether you stay or take it to go in the new environment, you still pre order as often as possible. I think the opportunity which we had started with kiosks, with our app and web channels. Our own channels are incredibly attractive to people. And they're more so every day. So, we're excited to see that continue to go and we'll see. And we'll go slowly and we'll go deliberately and with discipline.

Your next question comes from the line of Andrew Charles with Cowen and Company. Please proceed with your question.

Great, thank you. And I hope you guys are all staying well. Two separate questions for me. Tara, in 1Q, can you quantify the revenue dollar impact of the temporarily closed company stores given this wasn't picked up in the same store sales calculation? And then Randy, my question for you is that, when we eventually get back to the new normal, what factors are you evaluating to determine if you want to return to an exclusive third party delivery partner or continue what you're doing now with several partners?

So, Andrew, we actually haven’t quantified that revenue numbers for Q1. So I mean it was -- it obviously was fortunate, it wasn't very many Shacks, when it was towards the end of the quarter, but we actually haven’t broken that.

And just for context, everyone understand the kind of Shacks that are closed and why, so certain Shacks there, interior of a mall that's closed, we're not able to reopen certain Shacks like Grand Central Station that is just experiencing wildly lower numbers. So, we close that Shack. And some others where -- whether it's inside a hotel, or in a truly destination tourist area like international drive in Orlando, those Shacks are close. In terms of delivery partnerships Andrew, at the moment, we don't see a scenario where we would return to an exclusive arrangement. We're really -- I think, what's become clear to us through the first quarter and certainly now that we want to give opportunity for our guests to have it whatever region they're in and whichever platform they choose to use. We want to make sure that we're there for them. And we've really formed strong relationships with all of those partners. We're excited about that and what it means for our future as things -- as things return to more normalcy over time, we hope. And obviously, we're doing greatly elevated delivery. You know, who knows where that'll go. Hopefully, people will start to come out more and do more in person or pre ordering and continue to use our channels as the preferable channel covered in the meantime, and ongoing, we're going to work with all the major partners because we believe that's the best thing for the business long term.

Your next question comes from line of Brett Levy with MKM Partners. Proceed with your question.

Great. Thanks for the call. And I echo whatever everyone else has said, I hope you all are doing well. Now, you talked about a lot of things and you've always been a management team that's been thoughtful and methodical in your approach to different to introducing initiatives, but throughout this call, you obviously have a lot of operational protocols that you're putting in place reopening there multiple delivery partners, digital advancements. And you're still going to have other areas on the build out and menu. So, it seems like you have quite a bit on your plate. How are you thinking about prioritizing once you've gotten to the reopening and also what do you need to see to get to a steady state where you're -- the corporate infrastructure is rebuilt, and you get to whatever you consider full corporate staff? Thank you.

Brett, such an important and appreciated question. Thank you. I think, number one, you got to see safety. You got to see environments where our team and our guests can remain safe. Everything has to be driven from there. Once we see that, we're going to make sure that the priorities are done to take care of team and beginning to grow sales again. We look at those initiatives within all that can do that. So, for instance, on the opposite side, we've called down our menu touch. We've taken off some of the things that are harder to operate, and our -- a smaller percentage of our sales. So we have not introduced any LTO's for the moment, so we really got a nice core menu that we're doing there. So that's a perfect example of the other side. As we look at other priorities, there'll be a lot of our digital initiatives. The investments will begin in our tech and marketing. We’ve been in anyway. But certainly, as we come back, we're going to want to make sure those tools are as robust and safe and capturing the opportunity to grow as possible. That's really where it's going to be. But I think we do, we're being disciplined. Look, there's really good signals. If you look at the graphs and you see the recovery that we've begun to have, but we're still below our sales and we expect that we’ll use the case for some time. So, we've got to make sure that we are disciplined. We are not spending anything that is unnecessary. We certainly don't expect a whole lot of travel or other things like that that would normally be part of our ordinary course. And as things start to come, we'll start to add that back appropriately. We've got to understand what the new normal level of sales will be. And then, the last thing I'll say is, it's going to be time soon to figure out how to support new openings, right. We have not had an opening in a couple months and openings will be different now. They will be challenging, maybe opening without a dining room in a new opening, we'll have to see. So, we're going to make sure that we can prioritize our ability to do that, do that well, and make sure throughout the company; we are as staffed as possible at an appropriate level. So, we're continuing to be prudent with our cost structure, but not cutting the opportunity to gain sales where we can.

Your next question comes from the line of Jim Sanderson with Northcoast Research. Please proceed with your questions.

Hey, thank you for the question. Just wanted to dig in a little bit more to beef cost. We've heard a lot about the ground beef pricing increasing. One, hoping you can provide some feedback on your own unique blend and how that's trending relative to ground beef costs and then, remind us of what share of food costs are related directly to beef? Thank you.

Yes, look, generally in the first quarter, it was fine. The beef basket has roughly been around one-third of our company for many years. So, call it that roughly approximately. What has been something we're watching literally every hour now is the supply and costs of those as you've seen a lot of headlines lately. We are happy to say that at the moment, we've had zero supply challenges in getting our beef. The plants that we use have not been impacted. Although many plants you've seen across the country are working at reduced schedules. We do not today, expect the supply issue. However, costs have really jumped over this last few weeks and some expectation of moving forward. I think, you're starting to see some -- you're starting to see some challenges in that market. It's something we've got to watch very closely. We're expecting much higher costs on the beef market at the moment. And we don't expect that to be a long term problem. But I think, as is, as is the moment right now, nobody knows exactly on all these issues. So, watching closely, we believe our supplies intact, and we believe it's going to be more expensive. On the rest of the baskets, we're kind of right where we were. There are some wins. There are some losses, chicken bacon, those things we've locked in supply and cost. So we feel good about that. And generally, we don't see an issue in any major direction. There'll be some fluctuations with the rest of the basket from the moment, so beef is really a thing we’re watching and we'll keep you posted.

Ladies and gentlemen, we have reached the end of the question and answer session, and I would like to turn the call back to Mr. Randy Garutti, CEO for closing remarks.

Thank you so much everyone for taking the time to be with us today. We look forward to continuing to be in touch in China, trying to take care of our team as we slowly recover here and we hope we can see at a Shack sometime soon. Thanks, everybody. Take care.

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