Cracker Barrel Old Country Store, Inc. reported financial results for the third quarter of fiscal 2016 ended April 29.
Third Quarter Fiscal 2016 Highlights
Compared to the prior year third quarter, comparable store restaurant sales increased 2.3 percent and comparable store retail sales increased 2.2 percent.
Commenting on the third quarter results, Cracker Barrel President and Chief Executive Officer Sandra B. Cochran says, "During the third quarter, we had positive comparable store restaurant and retail sales growth, and continued to outperform the casual dining industry. With the reduction in commodity costs, and our management team's focus on cost savings initiatives, we increased our operating income by nearly twenty percent. We are encouraged by our May sales results, which we believe have been driven in part by customer enthusiasm around our summer menu offerings."
Third Quarter Fiscal 2016 Results
The company reported total revenue of $700.1 million for the third quarter of fiscal 2016, representing an increase of 2.4 percent over the third quarter of the prior year. Comparable store restaurant sales increased 2.3 percent, as a 2.9 percent increase in average check was partially offset by a 0.6 percent reduction in traffic. The average menu price increase for the quarter was approximately 2.8 percent. Comparable store retail sales increased 2.2 percent for the quarter.
The company says the Easter holiday shift between March and April resulted in a positive impact on comparable store traffic in March and a negative impact on comparable store traffic in April.
Based upon year-to-date financial performance, recent trends, and current estimates, the company raised its full-year earnings guidance. For fiscal 2016, the company now expects to report earnings per diluted share on a GAAP basis of between $7.75 and $7.85, and on an adjusted basis of between $7.45 and $7.55. The company now expects to report increases in comparable store restaurant and retail sales in the range of 2.0 percent to 2.5 percent. The company expects total revenue of between $2.90 billion and $2.95 billion, reflecting the expected opening of five new Cracker Barrel stores during the fiscal year.
The company now projects food commodity inflation to be flat for the fiscal year. The company projects operating income margin of approximately 9.5 percent of total revenue for fiscal 2016. The company expects depreciation expense between $77 million and $78 million; net interest expense of approximately $14 million; and capital expenditures of between $100 million and $110 million.