AGM 2021

Feb 26, 2021

Good day, and welcome to the Jack in the Box Incorporated Annual Meeting of Stockholders. I would now like to turn the conference over to Darren Harris. Please go ahead. Good morning. I'd like to call the meeting to order. Welcome to the twenty twenty one Jack in the Box Annual Stockholders Meeting. I'm Darren Harris, the CEO here at Jack in the Box. And on behalf of our Board of Directors, management and employees, thank you for joining us today. This morning, we will conduct the business outlined in our proxy statement. We will also provide a business update. Joining me on the line today are executive vice president, chief financial officer, Tim Mulaney Senior Vice President, Chief Legal and Risk Officer, Sarah Super and Carol DiRamo with Investor Relations. Also joining us today are all of our board members standing for election, David Goebel, Sharon John, Madeleine Kleiner, Michael Murphy, James Myers, David Tealy, and Vivian Young. We also have representatives from KPMG, our independent registered public account ants in attendance. At this time, I'll ask Sarah Supper to conduct the official vote on the items set forth in the proxy statement. Thank you, Darren, and good morning, everyone. This meeting is held pursuant to a printed notice mailed on 01/25/2021 to each stockholder of record who is entitled to vote on 12/31/2020. All documents concerning the call and notice of this meeting will be filed with the records of the meeting. According to our inspector of elections, Jim Alden of American Election Services, I can report that immediately prior to the commencement of the meeting, 20,633,902 shares of Jack in the Box Inc. Voting capital stock were present in person or by proxy. This is 89.98% of the outstanding voting stock of the company. Therefore, a quorum is present at this meeting. I would like to express my appreciation to all stockholders who returned their proxies. Those of you who have not yet voted may do so electronically at this time or until voting is closed. Any stockholder who has joined us today may revoke any proxy that he or she previously provided and instead may also vote electronically at this time or until voting is closed. However, we urge stockholders to allow their proxies to stand. After voting has been completed on all matters, all votes will be tallied. The first matter to be voted upon by the stockholders is the election of eight directors as identified in the proxy statement to serve until the twenty twenty two annual meeting. Any stockholders voting electronically should now cast their votes on this matter. The next matter to be voted on is the ratification on an advisory basis of the appointment of KPMG LLP as independent registered public accountant for the company for the purpose of auditing the financial statements of the company for the fiscal year ending 10/03/2021. Any stockholders voting electronically should now cast their votes on this matter. The final matter is an advisory vote pertaining to the compensation of our named executive officers. This proposal provides stockholders an opportunity to endorse or not endorse on an advisory basis our executive compensation programs and policies and the compensation paid to our named executive officers. Any stockholders voting electronically should now cast their votes on this matter. We will now tally up all the votes and deliver the results to mister Alden. It is now 08:34AM, and voting on matters before us today is closed. The ballots have been counted, and more than a majority of the necessary votes have been cast for the election of each of the eight directors named in the proxy statement for the ratification of the appointment of KPMG LLP as independent registered public accountants for the company and for on an advisory basis, the compensation of our named executive officers. We will report the final voting results on Form eight ks, which we will file within four business days. This concludes the formal portion of our twenty twenty one Annual Stockholders Meeting and our meeting is now officially adjourned. I'd now like to turn the call back over to Darren, who will provide a business update. This information as well as the following Q and A may include plans and estimates for the future, which are subject to various risks and uncertainties that may cause actual results to differ from these plans and estimates. I encourage you to review the risk factors outlined in our recent 10 ks and 10 Q filings on file with the SEC and available through our website. Darren? Thank you, Sarah. We opened our first restaurant in 1951 and have since become one of the nation's largest hamburger chains. And this year, we are proud to be celebrating our seventieth year anniversary. Our top 10 major markets comprise approximately 70% of the total system. Jack in the Box is at least the second largest QSR hamburger chain in eight of those major markets. We have system wide sales of approximately $3,700,000,000 and 93% of our restaurants are franchised with the average franchisee operating 19 restaurants. We now have over 2,200 or we have 2,237 restaurants in 21 states in Guam, but we have tremendous opportunity to grow across The The United States. We're known as the innovative leader in the QSR industry as Jack in the Box was one of the first concepts to offer breakfast, one of the first to have drive through, and one of the few to have the entire menu all day every day. Let's take a moment and look back at fiscal twenty twenty in review. While our financial performance was adversely impacted beginning in March by the COVID-nineteen pandemic, starting in our third quarter and continuing into our fourth quarter, we saw an acceleration of system wide same store sales and as a result, we achieved our tenth consecutive year of same store sales growth. Despite the significant challenges posed by the pandemic, fiscal twenty twenty included many achievements. System wide same store sales increased 4% over the prior year, marking the tenth consecutive year of same store sales growth. Operating earnings per share or EPS of $4.65 per share increased 6.9% from the prior year. Adjusted EBITDA increased 1.9 to $274,200,000 The company returned more than $180,000,000 to shareholders through stock buybacks and dividends. We continued to successfully execute on our strategic initiatives of building a better box and improving our core menu. And lastly, we completed the anticipated CEO transition as well as the final phase of our restructuring efforts, which included the transition of certain executive leadership roles. The 4% increase in system same store sales represented our tenth consecutive year of comparable sales growth and our average unit volumes have increased at a compound annual growth rate of 2.4% over that time. Last week, we reported first quarter earnings including a 12.5% increase in same store sales, which is the highest we've had since 1994 and significantly outpacing all of our direct competitors. Operating earnings per share from continuing operations has increased at a compound annual growth rate of more than 10% over the past four years and totaled $4.65 in fiscal 'twenty. And cumulatively, we've returned over $2,000,000,000 to shareholders via share repurchases and dividends over the last seven years. Our stock price was $80.24 on the last day of fiscal twenty, which was 09/25/2020. Since September, our stock price has increased approximately 25%. Our stock hit an all time low of $16.81 as the pandemic hit in March of twenty twenty, but we quickly rebounded and saw a fifty two week high of $104.39 in January of twenty twenty one. We currently have 19 analysts covering the stock with an average price target in excess of $112.11 have buy ratings, seven have hold ratings and only one analyst has a sell rating. Looking ahead, our long term goals are focused on meeting evolving customer needs with emphasis on improving operations consistency and targeted investments designed to maximize our returns. The key initiatives of our long term goals include building brand loyalty, driving operations excellence, growing restaurant profits and expanding Jack's reach by opening new restaurants. I'm very pleased to report that we continue to make significant progress with strengthening our relationship with our franchisees and we have reenergized the relationship and look forward to seeing this transpire into further growth of the Jack in the Box brand. In the time remaining, I'd like to turn the call over to Carol D'Aramo who will open up the call for Q and A. Carol? Thank you, Darren. Now we would like to open things up for shareholder questions and comments. If you have a question, please feel free to ask via the web portal now. Darren, looks like we have two questions in the queue. The first one is with COVID, have you had any major vendor supply issues? And if so, in which category? Yeah. With COVID, we have not seen any any challenges with our supply chain. I would give credit to our head of supply chain, Dean Gordon, who proactively went to our vendors and through through having years of relationship and partnership, did a nice job of preparing for COVID and making sure that the supply chain was prepared for the pandemic. So, you know, we we really took the opportunity to be first mover in engaging with our our vendors to make sure supply was solidified. Great. We have one additional question. Darren, what excites you most since you joined Jack in the Box last June? Yeah. I think, you know, over the the time that I've been with the organization, probably the thing that gets me the most excited is the level of engagement and passion that our people, our franchisees, and our guests have for the brand. We are making incredible strides with the relationship with our franchisees, and they're excited about the future of Jack in the Box. And the same holds true for our employees. And if we serve our people and our franchisees well, then I I believe that there's a lot of excitement for why we can also serve our guests well. I don't see any additional questions. So thank everyone for joining us today and this concludes our annual meeting. Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may now disconnect.