The company said food/beverage costs, coupled with fuel surcharges are impacting them more than they initially guided so they are need to raise prices again (up 2.7% in late June.) Despite a Q1 miss, management raised their guidance but mainly to reflect acquisition of 15 restaurants from franchisees.
The biggest concern going forward is the trend in labor costs. Labor costs were down again (down 40 bps in Q1 vs. down 60 bps in 4Q) so they are cutting costs somewhere. The company is calling it labor productivity (of course, not at the expense of guest experience!)
As seen in the chart below, RRGB is accelerating capital in a very difficult operating environment and not bringing the cash home to shareholders.