CBRL
$150.82
Cracker Barrel
$.34
.23%
Earnings Details
3rd Quarter April 2017
Tuesday, May 23, 2017 8:00:00 AM
Tweet Share Watch
Summary

Cracker Barrel Beats

Cracker Barrel (CBRL) reported 3rd Quarter April 2017 earnings of $1.95 per share on revenue of $700.4 million. The consensus earnings estimate was $1.84 per share on revenue of $710.8 million. The Earnings Whisper number was $1.86 per share. Revenue grew 0.0% on a year-over-year basis.

The company said it expects fourth quarter earnings of $2.10 to $2.20 per share. The current consensus earnings estimate is $2.17 per share for the quarter ending July 31, 2017.

Cracker Barrel Old Country Store Inc is engaged in the operation and development of the Cracker Barrel Old Country Store® concept. It offers home-style country cooking featuring many of its own recipes.

Results
Reported Earnings
$1.95
Earnings Whisper
$1.86
Consensus Estimate
$1.84
Reported Revenue
$700.4 Mil
Revenue Estimate
$710.8 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Cracker Barrel Reports Results for Third Quarter Fiscal 2017, Raises Full-Year Earnings Guidance, Increases Quarterly Dividend and Declares Special Dividend

Cracker Barrel Old Country Store, Inc. ("Cracker Barrel" or the "Company") (CBRL) today reported its financial results for the third quarter of fiscal 2017 ended April 28, 2017.

Third Quarter Fiscal 2017 Highlights

Operating income margin as a percent of total revenue increased 60 basis points over the prior year quarter to 10.2%.

Earnings per diluted share were $1.95, compared to GAAP earnings per diluted share of $2.04 in the prior year quarter. Adjusted for the impact of the reduction of provisions for uncertain tax positions, earnings per diluted share increased 7.1% from adjusted EPS of $1.82 in the prior year quarter. (See non-GAAP reconciliation below.)

The Company announced that its Board of Directors increased the quarterly dividend to $1.20 per share on the Company’s common stock, which represents a 4.3% increase over the Company’s previous quarterly dividend of $1.15.

The Board of Directors also declared a special dividend of $3.50 per share on the Company’s common stock.

Commenting on the third quarter, Cracker Barrel President and Chief Executive Officer Sandra B. Cochran said, "We are pleased to report that third quarter earnings per diluted share exceeded our expectations. Our operating income margin continues to grow as a result of commodity market favorability and our ongoing cost reduction initiatives. Our confidence in the strength of the Cracker Barrel brand is reflected in our raised full-year earnings guidance, our increased quarterly dividend, and our declared special dividend."

Third Quarter Fiscal 2017 Results Revenue

Total revenue for the third quarter of fiscal 2017 of $700.4 million was flat compared to the prior year quarter. Comparable store restaurant sales decreased 0.4%, as a 2.1% decline in comparable store restaurant traffic was partially offset by a 1.7% increase in average check. The average menu price increase for the quarter was approximately 1.6%. Comparable store retail sales decreased 4.7% from the prior year quarter.

Comparable store restaurant traffic, average check and comparable store restaurant sales and retail sales for the fiscal months of February, March, and April and the third quarter were as follows:

February March
April Third Quarter
Comparable restaurant traffic -3.2%
-2.8%
-0.7% -2.1%
Average check
1.5%
1.5%
1.9%
1.7%
Comparable restaurant sales
-1.7%
-1.3%
1.2%
-0.4%
Comparable retail sales
-8.4%
-11.4% 3.5%
-4.7%

Beginning in the third quarter, the Company modified its method for calculating traffic to more accurately reflect both dine-in and off premise dining occasions. The Company now measures traffic growth as change in entr?es sold (reflected in the above table), which includes entrees in our dine-in, to-go, and catering business; as we believe this measurement approach more accurately reflects underlying business growth.

Within the Supplemental Information section of this earnings release, the Company has provided comparable restaurant traffic, measured as change in entr?es sold, for fiscal 2017 by quarter.

Operating Income Operating income in the third quarter was $71.5 million, or 10.2% of total revenue, an increase over the prior year quarter result of $67.0 million, or 9.6% of total revenue. As a percentage of total revenue, reductions in cost of goods sold and general and administrative expenses were partially offset by increases in labor and related expenses and other store operating expenses.

Diluted Earnings per Share Earnings per diluted share were $1.95, compared to GAAP EPS of $2.04 in the prior year quarter. Adjusted for the impact of the reduction of provisions for uncertain tax positions, earnings per diluted share increased 7.1% from adjusted EPS of $1.82 in the prior year quarter. (For a reconciliation of GAAP to non-GAAP financial measures, please see the tables accompanying this release.)

Quarterly Dividend Increase and Special Dividend The Company announced that its Board of Directors increased the quarterly dividend to $1.20 per share on the Company’s common stock, which represents a 4.3% increase over the Company’s previous quarterly dividend of $1.15. The quarterly dividend is payable on August 4, 2017 to shareholders of record on July 14, 2017.

The Board of Directors also declared a special dividend of $3.50 per share on the Company’s common stock. This is the Company’s third special dividend declaration. The special dividend is payable on July 28, 2017 to shareholders of record on July 14, 2017.

Fiscal 2017 Outlook Based upon year-to-date financial performance and current estimates, the Company raised its full-year earnings guidance and now expects to report earnings per diluted share for the 2017 fiscal year between $8.25 and $8.35. The Company expects total revenue of approximately $2.95 billion, reflecting the expected opening throughout fiscal 2017 of six new Cracker Barrel stores and three new Holler & Dash Biscuit House restaurants. The Company now expects comparable store restaurant sales of between flat and 0.5% and comparable store retail sales of approximately -3.5%, reflecting the Company’s more cautious expectations for the fourth quarter. The Company expects food commodity deflation of approximately 4.5% for the year. The Company now projects an operating income margin of approximately 10.5% of total revenue for fiscal 2017. The Company expects depreciation expense between $85 million and $87 million; net interest expense of approximately $15 million; and capital expenditures of approximately $125 million. The Company anticipates an effective tax rate for fiscal 2017 of approximately 32%.

The Company expects to report earnings per diluted share for the fourth quarter of 2017 of between $2.10 and $2.20. The Company reminds investors that its outlook for fiscal 2017 reflects a number of assumptions, many of which are outside the Company’s control.

Fiscal 2017 Third Quarter Conference Call As previously announced, the live broadcast of Cracker Barrel’s quarterly conference call will be available to the public on-line at investor.crackerbarrel.com today beginning at 11:00 a.m. (ET). The on-line replay will be available at 2:00 p.m. (ET) and continue through June 6, 2017.

About Cracker Barrel Old Country Store? Cracker Barrel Old Country Store provides a friendly home-away-from-home in its old country stores and restaurants. Guests are cared for like family while relaxing and enjoying real home-style food and shopping that’s surprisingly unique, genuinely fun and reminiscent of America’s country heritage...all at a fair price. The restaurants serve up delicious, home-style country food such as meatloaf and homemade chicken n’ dumplins as well as our signature biscuits using an old family recipe. The authentic old country retail store is fun to shop and offers unique gifts and self-indulgences.

Cracker Barrel Old Country Store, Inc. (CBRL) was established in 1969 in Lebanon, Tenn. and operates 644 company-owned Cracker Barrel locations and four company-owned Holler & Dash Biscuit House locations across 44 states. Every Cracker Barrel store is open seven days a week with hours Sunday through Thursday, 6 a.m. - 10 p.m., and Friday and Saturday, 6 a.m. - 11 p.m. For more information, visit: crackerbarrel.com.

CBRL-F

Except for specific historical information, certain of the matters discussed in this press release may express or imply projections of revenues or expenditures, statements of plans and objectives or future operations or statements of future economic performance. These, and similar statements are forward-looking statements concerning matters that involve risks, uncertainties and other factors which may cause the actual performance of Cracker Barrel Old Country Store, Inc. and its subsidiaries to differ materially from those expressed or implied by this discussion. All forward-looking information is subject to completion of our financial procedures for Q3 FY 2017 and is provided pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995 and should be evaluated in the context of these factors. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "trends," "assumptions," "target," "guidance," "outlook," "opportunity," "future," "plans," "goals," "objectives," "expectations," "near-term," "long-term," "projection," "may," "will," "would," "could," "expect," "intend," "estimate," "anticipate," "believe," "potential," "regular," "should," "projects," "forecasts," or "continue" (or the negative or other derivatives of each of these terms) or similar terminology and include the expected effects of operational improvement initiatives, such as new menu items and retail offerings. Factors which could materially affect actual results include, but are not limited to: the effects of uncertain consumer confidence, higher costs for energy, general or regional economic weakness, weather on sales and customer travel, discretionary income or personal expenditure activity of our customers; our ability to identify, acquire and sell successful new lines of retail merchandise and new menu items at our restaurants; our ability to sustain or the effects of plans intended to improve operational or marketing execution and performance; changes in or implementation of additional governmental or regulatory rules, regulations and interpretations affecting tax, wage and hour matters, health and safety, pensions, insurance or other undeterminable areas; the effects of plans intended to promote or protect our brands and products; commodity price increases; the ability of and cost to us to recruit, train, and retain qualified hourly and management employees in an escalating wage environment; the effects of increased competition at our locations on sales and on labor recruiting, cost, and retention; workers’ compensation, group health and utility price changes; consumer behavior based on negative publicity or concerns over nutritional or safety aspects of our food or products or those of the restaurant industry in general, including concerns about pandemics, as well as the possible effects of such events on the price or availability of ingredients used in our restaurants; the effects of our indebtedness and associated restrictions on our financial and operating flexibility and ability to execute or pursue our operating plans and objectives; changes in interest rates or capital market conditions affecting our financing costs and ability to refinance all or portions of our indebtedness; the effects of business trends on the outlook for individual restaurant locations and the effect on the carrying value of those locations; our ability to retain key personnel; the availability and cost of suitable sites for restaurant development and our ability to identify those sites; our ability to enter successfully into new geographic markets that may be less familiar to us; changes in land, building materials and construction costs; the actual results of pending, future or threatened litigation or governmental investigations and the costs and effects of negative publicity associated with these activities; practical or psychological effects of natural disasters or terrorist acts or war and military or government responses; disruptions to our restaurant or retail supply chain; changes in foreign exchange rates affecting our future retail inventory purchases; implementation of new or changes in interpretation of existing accounting principles generally accepted in the United States of America ("GAAP"); and other factors described from time to time in our filings with the Securities and Exchange Commission, press releases, and other communications. Any forward-looking statement made by us herein, or elsewhere, speaks only as of the date on which made. We expressly disclaim any intent, obligation or undertaking to update or revise any forward-looking statements made herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.

CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited)
(In thousands, except share and per share amounts, percentages and ratios)
Third Quarter Ended
Nine Months Ended
Percentage
Percentage
4/28/17
4/29/16
Change
4/28/17
4/29/16
Change
Total revenue
$700,410
$700,136
0%
$2,183,063
$2,166,767
1%
Cost of goods sold (exclusive of
205,882
212,382
(3)
673,911
700,287
(4)
depreciation and rent)
Labor and other related expenses
250,819
249,324
1
759,193
745,581
2
Other store operating expenses
136,231
135,011
1
415,136
411,821
1
Store operating income
107,478
103,419
4
334,823
309,078
8
General and administrative
36,000
36,391
(1)
104,905
106,217
(1)
expenses
Operating income
71,478
67,028
7
229,918
202,861
13
Interest expense
3,389
3,436
(1)
10,703
10,549
1
Pretax income
68,089
63,592
7
219,215
192,312
14
Provision for income taxes
21,165
14,423
47
71,209
54,036
32
Net income
$46,924
$49,169
(5)
$148,006
$138,276
7
Earnings per share - Basic:
$1.95
$2.05
(5)
$6.16
$5.77
7
Earnings per share - Diluted:
$1.95
$2.04
(4)
$6.14
$5.75
7
Weighted average shares:
Basic
24,042,573
23,941,188
0
24,028,175
23,945,184
0
Diluted
24,121,203
24,073,778
0
24,111,753
24,064,624
0
Ratio Analysis
Total revenue:
Restaurant
82.1%
81.5%
79.7%
79.1%
Retail
17.9
18.5
20.3
20.9
Total revenue
100.0
100.0
100.0
100.0
Cost of goods sold (exclusive of
29.4
30.3
30.9
32.3
depreciation and rent)
Labor and other related expenses
35.8
35.6
34.8
34.4
Other store operating expenses
19.5
19.3
19.0
19.0
Store operating income
15.3
14.8
15.3
14.3
General and administrative expenses 5.1
5.2
4.8
4.9
Operating income
10.2
9.6
10.5
9.4
Interest expense
0.5
0.5
0.5
0.5
Pretax income
9.7
9.1
10.0
8.9
Provision for income taxes
3.0
2.1
3.2
2.5
Net income
6.7%
7.0%
6.8%
6.4%
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited and in thousands, except share amounts)
4/28/17
4/29/16
Assets
Cash and cash equivalents
$183,693
$176,692
Property held for sale
200
0
Accounts receivable
18,602
18,667
Income tax receivable
1,344
10,033
Inventory
155,532
145,882
Prepaid expenses
15,902
15,874
Deferred income taxes
2,867
5,636
Property and equipment, net
1,093,354
1,060,513
Other long-term assets
63,534
62,656
Total assets
$1,535,028
$1,495,953
Liabilities and Shareholders’ Equity
Accounts payable
$98,462
$88,011
Other current liabilities
239,808
228,170
Long-term debt
400,000
400,000
Interest rate swap liability
6,523
17,559
Other long-term obligations
128,230
128,007
Deferred income taxes
60,045
53,773
Shareholders’ equity, net
601,960
580,433
Total liabilities and shareholders’ equity $1,535,028
$1,495,953
Common shares issued and outstanding
24,042,573
23,941,998
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
(Unaudited and in thousands)
Nine Months Ended
4/28/17
4/29/16
Cash flows from operating activities:
Net income
$148,006
$138,276
Depreciation and amortization
63,628
57,481
Loss on disposition of property and equipment
3,760
3,812
Share-based compensation, net of excess tax benefit
5,144
6,830
(Increase) decrease in inventories
(3,224)
7,176
(Decrease) in accounts payable
(34,031)
(45,106)
Net changes in other assets and liabilities
19,789
(19,111)
Net cash provided by operating activities
203,072
149,358
Cash flows from investing activities:
Purchase of property and equipment, net of insurance recoveries
(80,861)
(69,504)
Proceeds from sale of property and equipment
413
639
Net cash (used in) investing activities
(80,448)
(68,865)
Cash flows from financing activities:
(Taxes withheld) from exercise of share-based compensation awards, net (6,031)
(5,281)
Excess tax benefit from share-based compensation
1,203
2,063
Purchases and retirement of common stock
0
(14,653)
Dividends on common stock
(85,069)
(151,385)
Net cash (used in) financing activities
(89,897)
(169,256)
Net increase (decrease) in cash and cash equivalents
32,727
(88,763)
Cash and cash equivalents, beginning of period
150,966
265,455
Cash and cash equivalents, end of period
$183,693
$176,692
CRACKER BARREL OLD COUNTRY STORE, INC.
Supplemental Information
(Unaudited)
Third Quarter Ended
Nine Months Ended
4/28/17
4/29/16
4/28/17
4/29/16
Units in operation:
Open at beginning of period
645
635
641
637
Opened during period
2
1
6
1
(Closed) during period
0
0
0
(2)
Open at end of period
647
636
647
636
Total revenue: (In thousands)
Restaurant
$575,098
$570,477
$1,739,888
$1,713,674
Retail
125,312
129,659
443,175
453,093
Total revenue
$700,410
$700,136
$2,183,063
$2,166,767
Cost of goods sold: (In thousands)
Restaurant
$142,486
$149,484
$441,338
$469,050
Retail
63,396
62,898
232,573
231,237
Total cost of goods sold
$205,882
$212,382
$673,911
$700,287
Average unit volume: (In thousands)
Restaurant
$890.8
$898.4
$2,702.0
$2,696.4
Retail
194.1
204.2
688.3
712.9
Total
$1,084.9
$1,102.6
$3,390.3
$3,409.3
Operating weeks:
8,393
8,255
25,113
24,786
Q3 2017 vs. Q3 2016
9 mo. 2017 vs. 9 mo. 2016
Comparable store sales period to period increase (decrease):
Restaurant
(0.4%)
0.5%
Retail
(4.7%)
(3.4%)
Number of locations in comparable store base:
635
632
The following table reports quarterly comparable store restaurant traffic, average check and comparable store restaurant sales.
First Quarter
Second Quarter
Third Quarter
Comparable restaurant traffic
-1.0%
-1.2%
-2.1%
Average check
2.3%
1.8%
1.7%
Comparable restaurant sales
1.3%
0.6%
-0.4%

CRACKER BARREL OLD COUNTRY STORE, INC. Reconciliation of GAAP basis operating results to adjusted non-GAAP operating results (Unaudited and in thousands)

In the accompanying press release the Company makes reference to As Adjusted provision for taxes and net income per share before the impact of a prior year reduction of the provisions for uncertain tax positions and the prior year retroactive restatement of the Work Opportunity Tax Credit. The Company believes that excluding this item and its related tax effects from its financial results reflects operating results that are more indicative of the Company’s ongoing operating performance while improving comparability to prior periods, and, as such may provide investors with an enhanced understanding of the Company’s past financial performance and prospects for the future. This information is not intended to be considered in isolation or as a substitute for operating income or earnings per share information prepared in accordance with GAAP.

Third Quarter ended April 28, 2017
Third Quarter ended April 29, 2016
As Reported Adjust
As Adjusted
As Reported Adjust
As Adjusted
(1)
Store operating income
$107,478
$-
$107,478
$103,419
$-
$103,419
General and administrative expenses 36,000
-
36,000
36,391
-
36,391
Operating income
71,478
-
71,478
67,028
-
67,028
Interest Expense
3,389
-
3,389
3,436
-
3,436
Pretax income
68,089
-
68,089
63,592
-
63,592
Provision for income taxes
21,165
-
21,165
14,423
5,312
19,735
Net income
$46,924
$-
$46,924
$49,169
($5,312)
$43,857
Earnings per share - Basic
$1.95
$-
$1.95
$2.05
($0.22)
$1.83
Earnings per share - Diluted
$1.95
$-
$1.95
$2.04
($0.22)
$1.82
Nine Months ended April 28, 2017
Nine Months ended April 29, 2016
As Reported Adjust
As Adjusted
As Reported Adjust
As Adjusted
(1)(2)
Store operating income
$334,823
$-
$334,823
$309,078
$-
$309,078
General and administrative expenses 104,905
-
104,905
106,217
-
106,217
Operating income
229,918
-
229,918
202,861
-
202,861
Interest Expense
10,703
-
10,703
10,549
-
10,549
Pretax income
219,215
-
219,215
192,312
-
192,312
Provision for income taxes
71,209
-
71,209
54,036
7,604
61,640
Net income
$148,006
$-
$148,006
$138,276
($7,604)
$130,672
Earnings per share - Basic
$6.16
$-
$6.16
$5.77
($0.31)
$5.46
Earnings per share - Diluted
$6.14
$-
$6.14
$5.75
($0.32)
$5.43
(1) Provision for taxes adjusted for the reduction of provisions for uncertain tax positions.
(2) Provision for taxes adjusted to exclude $2.3 million in 2016 for the prior year favorable effect of the retroactive reinstatement of the
Work Opportunity Tax Credit.
Investor Contact: Jessica Hazel
(615) 235-4367
Media Contact:
Janella Escobar
(615) 235-4618

https://mma.prnewswire.com/media/365217/Cracker_Barrel_Logo.jpg

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/cracker-barrel-reports-results-for-third-quarter-fiscal-2017

SOURCE Cracker Barrel Old Country Store, Inc.

https://rt.prnewswire.com/rt.gif?NewsItemId=CL97170&Transmission_Id=201705230800PR_NEWS_USPR_____CL97170&DateId=20170523