Cracker Barrel Q1 Results Beat View; Lifts 2015 Outlook

(RTTNews) - Full-service restaurants operator Cracker Barrel Old Country Store, Inc. (CBRL) on Tuesday reported a 25 percent increase in profit for the first quarter from last year, reflecting higher revenues and comparable store traffic in addition to an increase in operating margins.

Both earnings per share and quarterly revenues topped analysts' expectations. Looking ahead, the company provided earnings guidance for the second quarter below Street estimates, but raised its financial outlook for fiscal 2015.

Sandra Cochran, President and Chief Executive officer of Cracker Barrel said, "We are pleased with our first quarter results. We believe that our continued focus on enhancing the guest experience and operational improvements is reflected in the increase in comparable store traffic and sales, and in our operating margin."

The Lebanon, Tennessee-based operator of Cracker Barrel Old Country Store restaurant and retail concept reported net income for the first quarter of $34.02 million or $1.42 per share, up from $27.16 million or $1.14 per share in the prior-year quarter.

Adjusted earnings for the latest quarter were $1.42 per share, compared to $1.22 per share in the prior-year quarter that was adjusted for the impact of proxy contest expenses. On average, 7 analysts polled by Thomson Reuters expected the company to report earnings of $1.29 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenue for the quarter increased 5 percent to $683.43 million from $649.14 million in the same quarter last year, and beat analysts' consensus estimate of $665.50 million.

Comparable store restaurant sales for the quarter grew 3.3 percent, including a 2.5 percent increase in average check and a 0.8 percent increase in comparable store traffic.

The average menu price increase for the quarter was about 2.1 percent. Comparable store retail sales increased 6.1 percent for the quarter.

Restaurant revenues grew 5 percent from the year-ago period to $546.71 million, while retail revenues increased 7 percent to $136.72 million.

Operating margin improved 130 basis points from last year to 8.1 percent, primarily driven by a an 80 basis points reduction in general and administrative expenses, which was partially offset by an increase in cost of goods sold.

Looking ahead to the second quarter, Cracker Barrel forecasts earnings between $1.50 and $1.60 per share. Analysts expect earnings of $1.65 per share for the quarter.

For fiscal 2015, Cracker Barrel now expects earnings in a range of $5.95 to $6.10 per share on total revenue of about $2.8 billion. The revenue projection reflects the expected opening of six or seven new Cracker Barrel stores and projected increases in comparable store restaurant and retail sales in a range of 2.5 to 3.5 percent.

Earlier, the company forecast earnings of $5.80 to $5.95 per share for the year on projected revenues between $2.75 billion and $2.80 billion as well as comparable store restaurant and retail sales in a range of 2.0 to 3.0 percent.

Street is currently looking for earnings of $6.02 per share the year on revenues of $2.78 billion.

CBRL closed Monday's trading at $121.27. In Tuesday's pre-market activity, the stock is up $3.73 or 3.08 percent to $125.00.