“We are also seeing signs of even further inflationary pressures from many other items in our basket, including fries that are likely to cost us approximately 20% more this year than last.”

In context

“re experiencing today. But all else equal. If both of these risks did not materialize, we see a path for our restaurant margin to surpass 20% this year. We are planning for food and paper costs to rise by mid to high single digits year-over-year, led by beef costs rising by a similar degree. We do not hedge on many components of our basket, including beef, which is the largest single part of our basket, and an area where we see a significant degree of uncertainty around the cost this year. In the first quarter, our beef costs were up just modestly versus the fourth quarter, and we're down year-over-year. However, we have recently started to see our beef costs increase with broad-based challenges across the supply chain, and we anticipate this to be a material pressure throughout the year. We are also seeing signs of even further inflationary pressures from many other items in our basket, including fries that are likely to cost us approximately 20% more this year than last. But above all, we are also making continued investments in our people as we focus on building up and supporting our winning teams. This is resulting in mid single digit year-over-year wage pressures taken together. Our operating backdrop is not easy. Inflationary pressures still remain, and we believe we have the right plan in place to navigate and continue to show higher operating profitability despite these continued challenges. In fact, even with the inflationary and potential macroeconomic pressures, we are planning to grow fiscal 2023 adjusted EBITDA by at least 50 to 70% this year to $110 to $125 million as we target achieving record profits this year. We have line of sight to exceeding this range. However, this will be dependent on the degree of pressures we face throughout the yea”