What changed in this filing

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Item 1. Business

2024-03-08 compared with 2023-03-10 · 73 added, 89 removed, 230 unchanged (41% of the section changed)

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M arket Trends and Uncertainties

We may face future business disruption and related risks resulting from the ongoing COVID-19 pandemic or from another pandemic, epidemic or infectious disease outbreak, or from broader macroeconomic trends, any of which could have a significant impact on our business.

During the year ended December 28, 2022, we incurred $3.3 million in COVID-19 related expenses, comprised of $2.3 million due to overtime primarily related to the first quarter and $1.0 million due to leaves of absence related to the remaining three quarters.

During the year ended December 29, 2021 and December 30, 2020, we incurred $3.9 million and $4.9 million, respectively, in COVID-19 related expenses, primarily due to leaves of absence and overtime pay.

In addition, while all of our restaurants had dining rooms open as of December 28, 2022, we continue to experience staffing challenges, including higher wage inflation, overtime costs and other labor related costs.

Labor costs could also be adversely impacted as a result of California Assembly Bill No.

257, the Fast Food Accountability and Standards Recovery Act (“FAST Act”), which was signed into law in September 2022 and authorizes the creation of a council to set minimum standards for industry workers in California, including minimum wages.

The FAST Act, which will take effect if approved by voters in November 2024, could result in increased labor cost at our California restaurants thereby potentially impacting the profitability of our California restaurants.

Further, this bill could prompt similar legislation in other states.

We also continue to experience inflationary pressures, which resulted in increased commodity prices and impacted our business and results of operations during the year ended December 28, 2022.

We expect these pressures to continue during fiscal year 2023.

Due to the fluidity of the COVID-19 pandemic and current macroeconomic environment, we cannot determine the ultimate impact that the COVID-19 pandemic (and its related economic impacts) and the current macroeconomic environment will have on our consolidated financial condition, liquidity, and future results of operations, and therefore

any prediction as to the ultimate materiality of the adverse impact on our consolidated financial condition, liquidity, and future results of operations is uncertain.

On September 28, 2023, Governor Newsom signed AB 1228 into law, which repealed and replaced the Fast Food Accountability and Standards Recovery Act (“FAST Act”) on January 1, 2024.

Pursuant to AB 1228, the minimum wage at fast food restaurants that are part of brands which have more than 60 establishments nationwide will rise to $20 an hour on April 1, 2024, and a Fast Food Council created by AB 1228 will have limited power to approve annual wage increases until 2029.

Under the law, the Fast Food Council will also have the power to develop and propose minimum standards for fast food workers, including standards for working hours, working conditions, and health and safety.

As a result of AB 1228, we expect our labor and regulatory compliance costs will increase beginning in fiscal 2024 and that our results of operations and profitability will be adversely affected if we are not able to implement other measures to counter these increased costs.

We have experienced inflationary pressures affecting our operations in certain areas such as food cost, labor costs, construction costs and other restaurant operating costs.

We have been able to substantially offset these inflationary and other cost pressures through various actions, such as increasing menu prices, managing menu mix, and productivity improvements.

However, we expect these inflationary and other cost pressures to continue into fiscal year 2024 and we may not be able to offset cost increases in the future.

The restaurant industry is divided into two segments:

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We operate within the broader LSR segment, and we strive to offer the food and dining experience of a fast-casual restaurant and the speed, value, and convenience of a quick-service restaurant (“QSR”).

We strive to offer menu options that are made with fresh ingredients and provide a “better for you” alternative to typical fast food, which are also inspired by the culinary and cultural traditions of Mexico and our hometown of Los Angeles.

We strive to offer menu options that are made with fresh ingredients

and provide a “better for you” alternative to typical fast food, which are also inspired by the culinary and cultural traditions of Mexico and our hometown of Los Angeles.

Our Competitive Strengths

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We believe that our family-sized chicken meals provide a “better for you” and more convenient alternative for families looking to solve the “dinnertime dilemma” of providing their families with high-quality meals without investing significant time or money.

In 2022 approximately 28% of our company-operated sales were generated from family-sized meals, compared to 31% in both 2021 and 2020.

In 2023 approximately 26% of our company-operated sales were generated from family-sized meals, compared to 28% in 2022, and 31% in 2021.

Operations Infrastructure that Allows for Real-Time Control, Fast Feedback, and Innovation.

We believe that satisfying our customers’ dining needs is the foundation for our business, and we have an operations platform that allows us to measure our performance in meeting and exceeding those needs.

We utilize an operations dashboard that aggregates

real-time, restaurant-level information for many aspects of our business.

We utilize an operations dashboard that aggregates real-time, restaurant-level information for many aspects of our business.

The dashboard provides corporate and field management, as well as restaurant-level operators, with insight into how we are performing from the customer’s perspective.

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We seek to position ourselves as a differentiated LSR business, which we believe drives restaurant operating results that are competitive with other leading restaurant concepts in both the fast-casual and QSR industry segments.

We believe that our restaurant model is designed to generate strong cash flow, consistent restaurant-level financial results, and high returns on invested capital.

We believe that

our restaurant model is designed to generate strong cash flow, consistent restaurant-level financial results, and high returns on invested capital.

In 2023, our company-operated restaurants generated average annual sales per restaurant of approximately $2.2 million and restaurant-level contribution margins of 15.5%.

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Most of our senior management team has extensive operating experience in the restaurant industry.

Members of the senior leadership team include Larry Roberts as our Chief Executive Officer and President, Ira Fils as our Chief Financial Officer, Maria Hollandsworth as our Chief Operating Officer, Anne Jollay as our Chief Legal Officer, Rosanne Setoguchi as our Chief People Officer, Brian Carmichall as our Chief Development Officer and Andy Rebhun as our Chief Marketing Officer.

Members of the senior leadership team include Maria Hollandsworth as our interim President and Chief Executive Officer and Chief Operating Officer, Ira Fils as our Chief Financial Officer, Anne Jollay as our Chief Legal and People Officer, Brian Carmichall as our Chief Development Officer and Jill Adams as our Chief Marketing Officer.

Our Growth Strategy

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Through 2019, our system experienced annual comparable restaurant sales growth for eight consecutive years.

Our system comparable restaurant sales in fiscal 2020 declined 2.4%, which we believe was largely attributable to the COVID-19 pandemic.

In 2023, 2022 and 2021, our comparable restaurant sales grew 0.3%, 5.9% and 12.1%, respectively.

We plan to continue to expand our business, drive restaurant sales growth and increase company profits by executing our Transformation Agenda, which consists of the following four key strategies:

Embed our Unique El Pollo Loco Culture.

We plan to continue to expand our business, drive restaurant sales growth and increase company profits by executing our Strategic Plan, which consists of the following five key strategies:

Attract, Hire, and Retain Top Talent

We believe that success in the restaurant industry is highly correlated with employee engagement, which is dependent upon hiring, retaining, developing and motivating employees.

We invest in competitive pay and leadership training to ensure that our managers have the tools they need to be effective leaders and motivating coaches.

We continue to build a culture centered around our mission, which is to “Feed the Love that Makes Us All Feel Like Family” and “Heart-Centered Leadership,” which is predicated on servant-led leadership, employee recognition and community involvement.

We believe that executing on our mission will result in a better and more meaningful work experience for our employees.

An important part of our culture is to provide greater support to the communities in which we operate.

We continue to build a culture that embodies “Heart-Centered Leadership,” which is predicated on servant-led leadership, employee recognition and community involvement.

We believe that executing on our “Heart-Centered Leadership” model will result in a better and more meaningful work experience for our employees.

We believe that the key to building sustainable, consistent restaurant operations is through the development of a strong restaurant leader bench, including area managers, general managers, assistant managers and shift leaders.

To that end, we have put a renewed focus on leadership development, not only to benefit our current restaurant base, but also to ensure we have the leaders necessary for the continued growth of the El Pollo Loco brand.

An important part of our culture and how our “Heart-Centered Leadership” manifests into the broader community is shown through our local support.

In 2004, we created El Pollo Loco Charities, a non-profit charity, to support the communities surrounding our restaurants.

El Pollo Loco Charities, together with the Company, have provided over 15,000 meals per year to underprivileged families, through organizations like Food on Foot, Habitat for Humanity, Children’s Institute, and Court Appointed Special Advocates.

For example, in 2019 we enhanced our community outreach through several initiatives, including (i) implementing a food donation program with Food Donation Connection and donating 75,000 tacos as part of our “Buy One, Feed Many” initiative, (ii) celebrating Caesar Chavez Day by recruiting 500 company employees, franchisees and customers to refresh a high school located in south Los Angeles and (iii) entering into a relationship with an Orange County-based organization to provide job opportunities for the homeless.

In 2020, we provided funds to 13 Latina owned businesses that were heavily impacted by the COVID-19 pandemic.

In 2021, we launched a campaign called ValenKIND’s Day, which provided 10,000 meals to community members in our hometown of Los Angeles who are struggling with hunger and homelessness.

For Mother’s Day, we issued $80,000 in grants to help moms in our communities and moms who are restaurant team members pursue their dreams in our “Strong Like A Madre” campaign.

During 2022, we launched our first Round Up for Charity campaign benefiting Feeding America.

El Pollo Loco Charities committed to match the first 100,000 customer round ups in our effort to reach our goal of raising $400,000 for the charity.

In addition, in 2022, we donated 15,000 meals to Food on Foot’s Sunday Program, which serves people experiencing homelessness and food insecurity.

Further, during the holidays in 2022, we participated in toy drives for various local charitable organizations including California Highway Patrol’s CHiPs for Kids.

Lastly, we also continued a 2019 commitment to street artists in our communities by commissioning three new murals on the exterior walls of our restaurants in the Los Angeles area in celebration of Cesar Chavez Day, Mother’s Day, and Day of the Dead.

Build Awareness and Own our Lane .

We will continue to look for ways to expand upon the impact that El Pollo Loco Charities can have in the communities in which we serve.

EPL Hospitality

Serving our customers and delivering on exceptional hospitality begins with having an operations and training model that allows for consistent delivery of our products and services.

We believe that simplifying our restaurant operations will further enhance our ability to attract and retain the best employees and further improve customer service.

In 2023, we continued to implement initiatives to make it easier for our employees to operate our restaurants.

These included eliminating low-volume menu items with unique ingredients or complex builds, like our Keto Burrito, as well as purchasing pre-chopped serrano peppers and fresh cilantro to reduce prep and ensure consistency and using a new equipment to simplify salsa production.

Initiatives currently in test include a chicken holding cabinet, which improves overall quality and chicken availability during off-peak hours.

These and other initiatives are intended to enable our restaurant employees to increase their focus on delivering exceptional hospitality and speed of service to our customers.

We believe that this continued focus will lead to higher sales over the longer term.

Be Known For Our Famous Fire-Grilled Chicken

Our chicken is our differentiator.

We marinate, grill, chop, and shred chicken every day in our restaurants to deliver delicious chicken meals, Mexican-inspired entrees, and family meals to our customers.

Our grilled chicken is versatile and is offered in bone-in and boneless options, giving our customers choice and variety.

Our chicken will continue to be

the focus of our advertising campaigns and consumer messaging, and we believe that we are positioned uniquely to be the alternative to fried chicken in the marketplace.

We believe that we are uniquely positioned within the LSR restaurant space.

We will continue to adapt our menu to create family-sized dinner options and lunch entrees that complement our signature fire-grilled chicken and are inspired by the culinary and cultural traditions of Mexico and our hometown of Los Angeles.

We believe that we have opportunities for menu innovation as we look to increase customer frequency and target the dinner segment.

We believe that we have opportunities for menu innovation around different forms of chicken and portability as we look to increase customer frequency and earn share from the competition.

In addition, we will continue to tap into the need for healthier offerings by building on the success of our fire-grilled chicken and “better for you” products.

Our marketing and operations teams collaborate to ensure that the items developed in our test kitchen can be executed to our high standards in our restaurants with the convenience and value that our customers have come to expect.

We engage customers through our seasonal product calendar, which features new, unique limited time offers and variations of menu items like our Shredded Beef Birria, Overstuffed Fire-Grilled Chicken and Shredded Beef, and Avocado Quesadillas.

We engage customers through our seasonal product calendar, which features existing product platforms, like our Double Chicken Tostadas and Stuffed Quesadillas, and limited-time offers like our Chopped Chicken Salads.

Our key points of differentiation are communicated through our advertising campaign, which highlights the brand’s authenticity, “better for you” menu options and dedication to high-quality ingredients.

We tailor our message from television and direct mail, which garners broad exposure, to our Loco Rewards loyalty program and social media platform where we engage in more personalized marketing.

Digital-Centric In Service of Improving The Customer Experience

We believe that investing in consumer-facing technology is critical to further differentiating our brand and reaching customers for whom convenience and value are key decision factors.

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As of December 27, 2023, there were 3.7 million members in the Loco Rewards loyalty program, whom we target with segmented, dynamic campaigns with special offers tailored to each customer segment with the goals of increasing visit frequency and growing overall spend.

In June 2018, we implemented delivery through DoorDash, a third-party delivery provider.

In September 2019, we added Postmates and Uber Eats, and in February 2020 we added GrubHub, as additional marketplace delivery providers.

For meals ordered through these market place platforms, restaurants incur a fee based on a percentage of the ticket.

We also offer digital ordering through our mobile app, mobile web, and desktop web to provide convenient, easy ordering options for our customers.

In addition to offering digital ordering through our website and mobile app, we participate in 3rd party delivery marketplaces.

We currently have partnerships with DoorDash, Postmates, Uber Eats, and Grub Hub.

As of December 27, 2023, DoorDash maintained exclusivity for delivery orders placed directly with our restaurants.

For orders placed directly from the restaurant, no fee is charged to the restaurant as the full delivery cost is borne by the customer.

In total, during fiscal 2022, delivery orders constituted 7.8% of our total sales mix.

In total, during fiscal 2023, all digital and delivery orders including mobile and web orders constituted 12.0% of our total sales mix.

As of December 27, 2023, all company-operated and franchise restaurants offered integrated delivery through a third-party service.

We plan to continue investing in our loyalty and delivery programs as well as other technology platforms to continue making it easier for customers to access our food.

Deliver Exceptional Service – Profitably.

We believe that the key to building sustainable, consistent restaurant operations is through the development of restaurant leader bench, including area managers, general managers, assistant managers and shift leaders.

In addition to leadership development, at the team member level, we have completed the roll-out of an enhanced E-Learning platform across the system.

We also believe that simplifying our restaurant operations will further enhance our ability to attract and retain the best employees and further improve customer service.

In 2022, we continued to implement initiatives to make it easier for our employees to operate our restaurants.

These included eliminating a number of menu items as well as purchasing pre-chopped serrano peppers and fresh cilantro.

Initiatives currently in test include soak tanks for cleaning grill hoods and broilers, and blenders to simplify salsa production.

These and other initiatives are intended to enable our restaurant employees to increase their focus on customers and speed of service.

We believe that this continued focus, combined with renewed emphasis on providing an exceptional customer experience, will lead to higher sales over the longer term.

Accelerate Development.

We believe that execution of our first three strategies will enable us to grow our restaurant base.

Expand As An Asset Light Company

We believe that execution of our first four strategies will enable us to grow our restaurant base.

Our restaurant model is designed to generate strong cash flow, attractive restaurant-level financial results and high returns on invested capital .

In 2020, we finalized a new restaurant design that we believe will clearly differentiate and communicate our brand, both on the exterior and interior.

In addition, we redesigned the back-of-house to make it easier for employees to operate the restaurant.

We believe that our remodels using this new design will result in higher restaurant revenue and a strengthened brand.

During fiscal 2022, we completed six company-operated restaurants remodels using the new design.

In 2022, our franchisees completed 16 remodels using the new design.

During fiscal 2023, we opened five new stores, of which three were franchised and two were company-owned.

One of these locations was our second in the greater Denver-area, a new market for El Pollo Loco.

This location is performing well and provides another data point that our brand is poised to grow beyond core markets.

In addition to unit growth, we believe that remodels and refreshes to our existing fleet will keep El Pollo Loco relevant to our customers and keep them coming back.

In 2023, we completed 15 company-operated restaurant remodels, and our franchisees completed 33 remodels.

In 2024, we plan to continue our standard practices for remodels, including 15-20 company-operated and 40-50 franchised restaurants.

We expect future new unit development to be led by franchisees, with company development being focused on existing markets.

In order to expand into new markets, we believe that we need to source new franchisees and, therefore, we expect to invest more resources in sourcing and onboarding them in the future.

We expect future new unit development to be led by franchisees, through both in-fill in existing markets and expansion into adjacent and contiguous new markets.

In order to expand into new markets, we believe that we need to source new

franchisees and, therefore, we expect to invest more resources in sourcing and onboarding them in the future, including franchise recruitment, franchise operations, and field marketing,

Site Selection and Expansion

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We believe that our restaurant model is designed to generate strong cash flow, attractive restaurant-level financial results, and high returns on invested capital, which we believe provide us with a strong foundation for unit growth over the long-term.

In 2022, four new company-operated restaurants were opened, two in Nevada and two in California, and nine new franchised restaurants were opened, seven in California, one in Colorado, and one in Utah.

In fiscal 2023, we intend to open four to six new company-operated and eight to twelve new franchised restaurants.

There is no guarantee that we will be able to open new company-operated or franchised restaurants, or to increase the overall number of our restaurants.

We may be unsuccessful in expanding within existing or into new markets for a variety of reasons as described below in “Item 1A.

Risk Factors,” including competition for customers, sites, franchisees, employees, licenses, and financing.

In 2023, two new company-operated restaurants were opened in Nevada and three new franchised restaurants were opened, one in California, one in Colorado, and one in Utah.

In fiscal 2024, we intend to open two new company-operated restaurants in California and five to seven new franchised restaurants.

Site Selection Process

We consider the location of a restaurant to be a critical variable in its long-term success and as such, we devote significant effort to the investigation and evaluation of potential restaurant locations.

Our in-house development team has extensive experience building such brands as Taco Bell, The Habit Burger Grill, Carl’s Jr., Baskin Robbins, Wendy’s, Denny’s and Dunkin’ Brands.

Our in-house development team has extensive experience building such brands as Burger King, Carl’s Jr., Jimmy John’s, QDOBA, Baskin Robbins, Denny’s and Dunkin’ Brands.

We use a combination of our in-house development team and outside real estate consultants to locate, evaluate, and negotiate new sites using various criteria, including demographic characteristics, daytime population thresholds, and traffic patterns, along with the potential visibility of, and accessibility to, the restaurant.

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Our restaurants perform well in a variety of neighborhoods, which gives us greater flexibility and lowers operating risk when selecting new restaurant locations.

We approve new restaurants only after formal review by our real estate site approval committee, which includes most of our senior management, and we monitor restaurants’ on-going performances to inform future site selection decisions.

We approve new restaurants only after formal review by our real estate site approval committee, which includes some of our senior management, and we monitor restaurants’ on-going performances to inform future site selection decisions.

Restaurant Construction

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These systems include customer surveys, social media ratings and speed-of-service performance trends.

The operational results from all of these sources are then presented on an operations dashboard that displays the measures in an easy-to-read online format that corporate and restaurant-level management and franchisees can utilize in order to develop specific plans for continuous performance improvement.

specific plans for continuous performance improvement.

In addition, all company operated restaurants utilize digital “communication boards”, which communicate sales, costs and consumer data in real time to our restaurant managers.

We have food safety and quality assurance programs designed to maintain the highest standards for the food and the food preparation procedures that are used by both company-operated and franchised restaurants.

We have a quality assurance team and employ third-party auditors that perform our work place and food safety restaurant audits.

We have a quality assurance team and employ third-party auditors that perform our workplace and food safety restaurant audits.

Managers and Team Members

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Overseeing the area leaders are three Regional Directors of Operations who report up to our Chief Operating Officer.

Franchise operations are supported by three directors of franchise and a Senior Vice President, Franchise, who reported to the Chief Development Officer during 2022 and starting in 2023 will report to the Chief Operating Officer.

The restaurant development team is supported by four directors who also currently report to the Chief Development Officer.

Franchise operations are supported by four directors of franchise and a Vice President, Franchise Operations, who reports to the Chief Operating Officer.

Our team members are the heart of El Pollo Loco, and it is our responsibility to equip them with the skills and knowledge necessary to deliver our high standards and commitments to the customer and team member experience.

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The program introduces new franchise members to El Pollo Loco with hands-on training in the operation and management of our restaurants.

This foundational training is conducted by a

general training manager who has been certified by our operations group.

This foundational training is conducted by a general training manager who has been certified by our operations group.

Training must be successfully completed before a trainee can be assigned to a restaurant as a manager.

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Marketing and Advertising

We strive to distinguish the El Pollo Loco brand by building a brand equity that we believe not only accentuates our strengths but also deepens the strong emotional connections we have with our customers.

We promote our restaurants and products by emphasizing our points of differentiation, which include our Mexican and LA heritages, our fresh ingredients and made-from-scratch preparation, and the cooking of our citrus-marinated chicken on open fire grills in our kitchens, as well as the convenience and quality we offer for families.

We strive to distinguish the El Pollo Loco brand by building brand equity that we believe not only accentuates our strengths but also deepens the strong emotional connections we have with our customers.

We promote our restaurants and products by emphasizing our points of differentiation, which include our Mexican heritage, our fresh ingredients and made-from-scratch preparation, and the cooking of our citrus-marinated chicken on open fire grills in our kitchens, as well as the convenience and quality we offer for families.

We use multiple marketing channels, including television, radio and digital.

We advertise on local broadcast and cable television.

Over the past year, we have significantly increased our percentage of media dedicated towards digital advertising.

We use both traditional and digital media channels to have targeted advertising to reach our audience segments.

Through our public relations efforts, we engage notable food editors, influencers and bloggers on a range of topics to help promote our products.

In addition, we engage in one-on-one conversations using a portfolio of social media platforms, including Facebook, TikTok, Instagram and Twitter.

In addition, we engage in one-on-one conversations using a portfolio of social media platforms, including Facebook, TikTok, Instagram, Threads, and X (formerly Twitter).

We also use social media as a research and customer service tool, and apply insights gained to future marketing efforts.

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Available at every location and accessible from elpolloloco.com or the El Pollo Loco mobile app, any order can be placed and paid for before arriving at the restaurant.

El Pollo Loco has partnered with DoorDash, UberEats and Grubhub as additional methods for ordering.

El Pollo Loco has partnered with Postmates, DoorDash, UberEats and Grubhub as additional methods for ordering.

El Pollo Loco also operates direct delivery via elpolloloco.com or the Loco Rewards App, which is exclusively fulfilled by DoorDash.

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We contract with McLane Company (our “primary distributor”), a major foodservice distributor, for substantially all of our food and supplies, including the poultry that our restaurants receive from suppliers.

Our primary distributor delivers supplies to most of our restaurants three times per week.

Our primary distributor delivers supplies to most of our restaurants two to three times per week.

Our restaurants in Texas, Louisiana and Colorado utilize regional distributors for produce.

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In the past, we have entered into contracts ranging from one to two years depending on current and expected market conditions.

We currently source poultry from six suppliers, with two accounting for approximately 79% of our purchases for fiscal 2022.

We currently source poultry from six suppliers, with three accounting for approximately 70% of our purchases for fiscal 2024.

More than half of our poultry purchases have a fixed price through the end of 2024.

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Our policy is to pursue and maintain registration of service marks and trademarks in those countries where business strategy requires us to do so, and to oppose vigorously any infringement or dilution of the service marks or trademarks in those countries.

We maintain the recipe for our chicken marinade, as well as certain proprietary standards, specifications, and operating procedures, as trade secrets or as confidential proprietary information.

maintain the recipe for our chicken marinade, as well as certain proprietary standards, specifications, and operating procedures, as trade secrets or as confidential proprietary information.

We operate in the restaurant industry, which is highly competitive and fragmented.

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● the preparation, sale and labeling of food, including regulations of the Food and Drug Administration, which oversees the safety of the entire food system, including inspections and mandatory food recalls, menu labeling and nutritional content;

● working conditions, health, sanitation, safety and fire standards, building and zoning requirements, public accommodations and safety conditions, environmental matters, and data privacy;

● working hours and working conditions, health, sanitation, safety and fire standards, building and zoning requirements, public accommodations and safety conditions, environmental matters, and data privacy;

● building and zoning requirements, including state and local licensing and regulation governing the design and operation of facilities and land use;

● health and sanitation and public safety.

● restaurant operations related to COVID-19.

We require each of our franchise partners to comply with all federal, state and local laws and regulations.

We have processes in place to monitor our own compliance with the numerous, complex, applicable laws and regulations governing our operations.

We are subject to new, varied and ever-changing rules and regulations regarding the current COVID-19 pandemic, which have materially impacted our earnings and resulted in significant capital expenditures.

New federal, state and local government regulations regarding COVID-19 are issued and existing regulations are frequently revised, which materially affected, and continues to affect, our operations.

Such regulations govern, for example, employee leave, opening and closing of restaurants and dining rooms, business hours, sanitation practices, guest spacing within dining rooms and other social distancing practices and personal protective equipment.

Other than as described above, the Company’s compliance with federal, state or local laws and regulations, including environmental laws, is not expected to materially affect our earnings or competitive position or result in material capital expenditures.

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The health and well-being of our employees and guests have always been and continues to be our top priority.

We have maintained enhanced safety measures and continue to monitor cases of COVID-19 to help protect the health and well-being of all of our employees.

In 2022, we also continued to provide extended sick leave benefits to employees impacted by COVID-19.

We have maintained enhanced safety measures to help protect the health and well-being of all of our employees.

Seasonal factors, including weather and the timing of holidays, cause our revenue to fluctuate from quarter to quarter.

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Available Information

We make available free of charge on our Internet website our Annual Reports, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as soon as reasonably practicable after we

electronically file such material with, or furnish it to, the Securities and Exchange Commission (“SEC”).

Our Internet address is www.elpolloloco.com.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business