Dive Brief:

• Red Robin CEO Paul Murphy will retire at the end of the year when his employment agreement expires, the company said Wednesday. 
• Murphy will help the board search for a successor and remain as a special advisor until March 31, 2023, to help with the transition. 
• When Murphy came on board in October 2019 following the departure of CEO Denny Marie Post, he said his tenure would last three years to help the company improve its operations. 

Dive Insight:

Murphy’s experience, which included leadership positions at Noodles & Company, Einstein/Noah Restaurant Group and Del Taco, helped the company navigate through the pandemic. 

At the height of lockdowns, Red Robin posted same-store sales declines of 41.4% in Q2 2020. As of Q1 2022, the company’s comparable restaurant revenue increased 19.7% compared to the year ago quarter.

During his three years as CEO, he restored in-restaurant operations, managed the onset and impact of the pandemic, grew off-premise sales and secured a five-year credit facility, the company said. He was also at the helm as the chain implemented an enhanced service model, which includes handheld technology allowing servers to input orders tableside as orders are given. Drinks are then prepared prior to when the full order is in, allowing for beverages to be brought to the customers faster. This process helps free up servers to spend more time roaming dining rooms and less on taking orders and delivering meals. 

Among the specific strategies implemented include launching three delivery-only brands and the continued rollout of its Donatos partnership, which reached about 200 locations at the end of 2021. Its relationship with Donatos helped the company build topline and bottomline sales and contributed to growth in off-premise sales during the pandemic. 

Restaurants operating with Donatos, which reached almost half of company stores by Q1 2022, outperformed non-Donatos locations by over 5% compared to 2019. During the quarter, pizza sales generated over $7 million and checks with pizza were over $10 on average.

“As was his intention when he joined Red Robin, Paul has stabilized the foundation and positioned the brand for renewed growth going forward,” Dave Pace, board chair at Red Robin, said in a statement.