Prices, healthier menu lift Cracker Barrel earnings
LEBANON, Tenn. – Citing the 16-day partial government shutdown as hurting store sales and traffic in October, Cracker Barrel Old Country Store, Inc. posted positive results for the first quarter with help from higher prices and its recently launched better-for-you menu.
“The first quarter represented the eighth consecutive quarter of positive comparable store, restaurant and retail sales and our performance of the net track casual dining index for sales and traffic,” said Sandra Cochran, president and chief executive officer, during a Nov. 26 call with financial analysts. “Unfortunately, the government shutdown in October had a negative impact on our traffic for the quarter as many Americans canceled or postponed travel plans to visit our national parks and other destinations. Despite this interruption, our operating income and earnings per share exceeded our expectations and reflects our initial success in executing our business priorities for fiscal 2014.”
Such priorities include reinforcing everyday value on the menu and focusing on healthier additions through its new Wholesome Fixin’s menu, which launched in August and has prompted positive feedback in customer surveys.
“The addition of Wholesome Fixin’s was a significant change to our menu as the roll-out included new equipment, processes, ingredients and recipes,” Cochran said. “Overall, we’re very pleased with the results of the Wholesome Fixin’s introduction and look forward to continuing to develop interest in this category.”
For the quarter ended Nov. 1, net income climbed 18 percent to $27,160,000, equal to $1.14 per share on the common stock, up from $23,192,000, or 98c per share, during the prior-year period.
Total revenue increased 4 percent to $649,141,000 from $627,451,000 last year.
While comparable restaurant traffic dipped 0.1 percent during the quarter, comparable store restaurant sales increased 2.8 percent, reflecting a 2.9 percent increase in average check and an average menu price increase of approximately 2.5 percent. Comparable store retail sales increased 2.5 percent for the quarter. The company opened one new restaurant during the quarter for a total of 625 units in operation.
“…despite continued economic concerns, our consistent focus on our long-term strategy and our initial execution of our business priorities led us through a solid quarter of steady revenue growth with strong operating performance,” Cochran said. “We remain focused on these priorities through the busy holiday season and second quarter.”