1. The NPD Group, Inc. | Proprietary and Confidential Copyright 2014. The NPD Group, Inc. All Rights Reserved. This presentation is Proprietary and Confidential and may not be disclosed in any manner, in whole or in part, to any third party without the express written consent of NPD. Parties with Kids: Motivating More Visits April 2014

2. The NPD Group, Inc. | Proprietary and Confidential 2 About This Report The restaurant industry’s ability to attract parties with kids (those including children under age 13) has been declining since 2008. The losses have been significant: parties with kids made slightly over one billion fewer visits to U.S. restaurants over the past six years. No restaurant segment was left unscathed; seventy percent of all traffic declines stemming from full service restaurants. Visits dropped across all meal periods, with supper hit especially hard – well over half of all visit losses occurred at the dinner occasion. Households with kids face daily decisions about what and where to feed the family. In order to bring back parties with kids to the restaurant table, operators and manufacturers need to understand what consumers seek for these visits. Insights from this report will answer these questions and many others …. Why have visits by households with kids declined? What do visits look like for families dining out with kids? What preferences drive the decision to dine out with children? What types of menu items will have the biggest impact on attracting parties with kids? Is entertainment important, and what will entice more families through the door?

3. The NPD Group, Inc. | Proprietary and Confidential 3 In-depth custom online survey uncovering barriers to restaurant visitation, changes in visitation, current restaurant visit situation, decision-making process, attitudes toward restaurant fit with kids’ needs, reasons for visiting, menu preferences, restaurant features that attract families including kid- specific aspects, and general attitudes about kids eating out Study conducted February 2014 Other Information Sources: CREST Sample Ending sample of 4,352 families with kids aged 2-12 36% have kids 2-5 years of age (n=1,586) 45% have kids 6-10 years of age (n=1,944) 19% have kids 11-12 years of age (n=822) Most respondents have visited a quick serve or full serve restaurant in the past 3 months 85% have visited (n=3,673) but 28% are visiting less than they did a year ago (n=1,042) 15% have not visited (n=679) Information Collected Parties with Kids: Motivating More Visits

4. The NPD Group, Inc. | Proprietary and Confidential Source: CREST®, years ending February Family Parties with Kids 12 years and under Visit Trend 4 Total Restaurant Visits (000s) There are one billion fewer restaurant occasions in 2014 versus 2008 among parties with kids (12 years and under) The steepest declines occurred at the start of the recession and have been slow to recover

5. The NPD Group, Inc. | Proprietary and Confidential -700 Million family visits since 2008 = 70% of total family party declines Segment Visit Distribution Source: CREST®, year ending February* Traffic Share by Segment Among Family Parties with Kids <12 Present Family occasions have changed over the years. The majority of the pullback stems from the Full Service group, accounting for seventy percent of all declines from 2008 to 2013. Many visits shift from Full Service to Traditional QSR and Fast Casual Traditional QSR Fast Casual Midscale Casual Dining Fine Dining 5

6. The NPD Group, Inc. | Proprietary and Confidential 6 Visiting Less Watching Wallet Non Visiting Personal Preference Not Visiting Q.3 Why haven’t you visited a fast food, fast casual, family dining-style or casual dining restaurant with your child in the past 3 months? (Multiple response) Q.18 You mentioned that you eat out less often than you used to with your child – why is that? (Multiple response) Reasons Some Families are Visiting Less or Not at All Operators have a better chance of increasing visits by focusing on appropriate value cues targeted towards those who are still visiting, but less often Average Party Check* Family w/Kids 12 & Under: $21.30 Adult Only: $10.43 *Source: CREST®, year ending February 2014

7. The NPD Group, Inc. | Proprietary and Confidential 7 Reasons Why Some Families are Visiting Less by Age of Child Prefer Home Cooking Not a Kid Friendly Place Households with Kids 2-5 Bad Economy Not a Good Value Households with Kids 6-12 Attributes with Significant Differences Between Child’s Ages Those with older kids are worried more about the expense while those with younger kids desire a kid-friendly establishment Q.18 You mentioned that you eat out less often than you used to with your child – why is that? (Multiple response) 2-5 n=3816-12 n=661