Cracker Barrel reported third-quarter results that exceeded analyst expectations and lifted its full-year forecast, as cost management helped offset a continued decline in sales.
For the fiscal third quarter ended May 1, adjusted earnings came in at 29 cents per diluted share — a result that far outpaced the adjusted loss of 48 cents per share Wall Street had anticipated, per Barron’s
Quarterly revenue of $797.4 million topped the $776.7 million consensus estimate, though the figure still represented a 2.9% drop from the prior year. On a GAAP basis, net income reached $42.8 million, or $1.90 per diluted share — more than triple the $12.6 million, or 56 cents per diluted share, recorded in the same period a year ago. Embedded in that figure is $47.4 million in proceeds from a settlement of interchange fee litigation, an item Cracker Barrel stripped out of its adjusted earnings calculation.
Restaurant same-store sales slipped 2.6% year over year, and retail same-store sales were off 1.8%. Despite those declines, the retail segment managed to outpace restaurant comps — a feat the company said had not occurred in more than four years. CFO Craig Pommells acknowledged that guest traffic fell 6.7% but said the direction of that metric is moving in the right direction. “Our initiatives to improve operations, deepen guest connection, and enhance profitability continue to gain traction, with strong execution from our teams driving third quarter results that exceeded expectations,” President and CEO Julie Masino said in a statement.