Cracker Barrel Q3 Earnings Miss Estimates; Warns On Inflationary Pressures

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  • Cracker Barrel Old Country Store Inc CBRL reported third-quarter FY22 sales growth of 11% year-on-year to $790.2 million, missing the consensus of $795.52 million.
  • Comparable store retail sales increased 9.7%, and comparable store restaurant sales grew 10.9%.
  • General and administrative expenses increased 8% Y/Y to $40.2 million. The operating margin was 3.9%, and operating income for the quarter fell 42% to $30.5 million.
  • Cracker Barrel held $24.8 million in cash and equivalents as of April 29, 2022.
  • Adjusted EPS of $1.29 missed the analyst consensus of $1.35.
  • Dividend: Cracker Barrel's Board of Directors declared a regular quarterly dividend of $1.30 per share, payable on August 5, 2022, to shareholders of record as of July 15, 2022.
  • Buyback: CBRL Board approved a new share repurchase program of up to $200 million of common stock, which replaced the remaining portion under the prior authorization.
  • "A challenging macro environment, including deteriorating consumer sentiment and high inflationary pressures, impacted both our top and bottom lines in the third quarter," said CEO Sandra B. Cochran.
  • Outlook: Cracker Barrel expects the near-term consumer environment to remain challenged due to high inflation and lower consumer confidence, especially for the age sixty-five-plus consumer group.
  • For Q4, CBRL expects operating margins to be adversely impacted by commodity, wage, and other operating expenses inflation.
  • The company anticipates Q4 revenue to be approximately 8.0% above the prior year and adjusted operating income margin to be 4.0% - 4.5%.
  • Price Action: CBRL shares are trading lower by 2.35% at $99.50 on the last check Tuesday.
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