LEBANON, TENN. — Successful menu promotions, including a pumpkin spice pancake breakfast and a harvest kale chicken salad, contributed to an increase in comparable restaurant sales at Cracker Barrel Old Country Store, Inc. in the recent quarter.
Net income in the first quarter ended Oct. 28 was $48,355,000, equal to $2.01 per share on the common stock, up 18% from $40,865,000, or $1.71 per share, in the prior-year period. Results were helped by cost savings initiatives and the favorable commodity environment.
Total revenue increased 1% to $709,971,000 from $702,629,000.
During the quarter, comparable restaurant sales increased 1.3%, with average check up 3% and traffic down 1.7%.
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| Sandra B. Cochran, president and c.e.o. of Cracker Barrel |
“This quarter marked the 10th consecutive quarter of positive sales growth and our 20th consecutive quarter of outperforming the casual dining industry,” said Sandra B. Cochran, president and chief executive officer, during a Nov. 22 earnings call with financial analysts. “We believe the differentiation of our brand experience and our excellent operations execution and our broadened marketing efforts helped us in outpacing the industry.”
In addition to seasonal menu offerings, the company launched a marketing campaign in the quarter highlighting “Breakfast Y’all Day” at Cracker Barrel restaurants.
“Breakfast all day has been a key differentiator to the Cracker Barrel brand since 1969, and we chose a play on words to convey our distinct Southern brand heritage in a humorous way, particularly targeting the millennial consumer,” Ms. Cochran said. “With breakfast all day emerging as a recent topic of conversation among consumers looking for a differentiated experience, and with it being one of our natural brand strengths we identified an opportunity to interact with guests through the use of our billboard advertising, social and digital media and retail merchandise in a fun and uniquely Cracker Barrel way.”
Based on year-to-date performance, the company raised its previous fiscal 2017 earnings guidance and now expects earnings per diluted share of $8.10 to $8.25. The company anticipates total revenue of between $2.95 billion and $3 billion, reflecting the expected opening of 12 to 14 new restaurants, with projected comparable restaurant sales in the range of 1% to 2%.
“While we continue to believe our efforts will resonate with our core and targeted guest base we remain cautious in our traffic outlook for the fiscal year,” Ms. Cochran said. “Yet I remain confident that our continued strategic focus to enhance the core, expand the footprint and extend the brand will further move the brand forward and deliver solid returns for our shareholders.”
