Chili's 2015 Annual Report Download - page 10

guest arrives during peak shifts, and to send them a text when their table is ready. Guests can also add themselves
to the wait list via the Chili’s mobile app which we believe will reduce the in-restaurant wait time and increase
the efficiency of our restaurants by allowing us to turn tables more effectively.
We continually evaluate our menu at Chili’s to improve quality, freshness and value by introducing new
items and improving existing favorites. Our Fresh Mex platform introduced last year has been very successful
and includes Fresh Mex Bowls, Mix and Match Fajitas and Tableside Guacamole. We leveraged this success by
launching our new Top-Shelf Taco category including Pork Carnitas, Ranchero Chicken and Prime Rib tacos in
the fourth quarter. We also introduced Fresh Tex, a new Texas themed platform featuring ribs, steaks and burgers
this year. Our traditional burger menu was also updated with a new line of Craft Burgers, featuring fresh potato
buns and house made garlic pickles. We continually seek opportunities to reinforce value and create interest for
the brand with new and varied offerings to further enhance sales and drive incremental traffic. We are committed
to offering a compelling everyday menu that provides items our customers prefer at a solid value.
Improvements at Chili’s will have the most significant impact on the business; however, our results will also
benefit through additional contributions from Maggiano’s and our global business. Maggiano’s continues to
deliver sales growth and has opened three restaurants in fiscal 2015 based on the new prototype, which excludes
banquet space. This new prototype will allow the brand to enter new markets for which the existing model was
not suited. Maggiano’s is committed to delivering high quality food and a dining experience in line with our
brand heritage. We will continue to strengthen the brand’s business model with kitchen efficiency and inventory
controls that we believe will continue to enhance profitability.
We capitalized on an opportunity to further expand our domestic business by purchasing a franchisee of 103
Chili’s restaurants in the Northeast and Southeast U.S. subsequent to the end of the year. We believe this
acquisition fits well within our capital allocation strategy and will enable us to grow our sales and profits in fiscal
2016. We have begun implementing several initiatives at these locations designed to increase sales and margins
including restaurant reimage, loyalty and other operational processes. Global expansion allows further
diversification which will enable us to build strength in a variety of markets and economic conditions. This
expansion will come through franchise relationships, acquisitions, joint venture arrangements and equity
investments. Our international franchisees opened 22 new restaurants in fiscal 2015 and plan to open 25 to 30
new international Chili’s restaurants in fiscal 2016. Growing franchise operations enables us to improve revenues
and operating income through increased royalties and franchise fees. We continue to work with our domestic
franchisees to increase the pace of reimages of their restaurants, and to leverage technology initiatives like My
Chili’s Rewards and No Wait in their restaurants.
The casual dining industry is a highly competitive business which is sensitive to changes in economic
conditions, trends in lifestyles and fluctuating costs. Our priority remains increasing profitable growth over time
in all operating environments. We have designed both operational and financial strategies to achieve this goal
and in our opinion, improve shareholder value. Success with our initiatives to improve sales trends and
operational effectiveness will enhance the profitability of our restaurants and strengthen our competitive position.
We believe the effective execution of our financial strategies, including repurchasing shares of our common
stock, payment of quarterly dividends, disciplined use of capital and efficient management of operating expenses,
will enhance shareholder value. We remain confident in the financial health of our company, the long-term
prospects of the industry, as well as our ability to perform effectively in a competitive marketplace and a variety
of economic environments.
Company Development
In fulfilling our long-term vision, over the past fiscal year we continued the expansion of our restaurant
brands domestically through a select number of new company-owned restaurants in strategically desirable
markets. We concentrate on the development of certain identified markets to achieve the necessary levels to
improve our competitive position, marketing potential, profitability and return on invested capital. Our domestic
expansion efforts focus not only on major metropolitan areas in the United States but also on smaller market
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