Cracker Barrel Old Country Store Inc. Reports Strong Q4 Profit

Shares of Cracker Barrel Old Country Store Inc. (CBRL) rebounded 1.0% in premarket trading Wednesday, following the company's fiscal fourth-quarter earnings report. While their profit exceeded expectations, revenue fell short due to recent traffic challenges.

Healthy Profit Growth

During the quarter ended July 28, net income rose to $37.5 million, or $1.68 per share, compared to $33.4 million, or $1.47 per share, in the same period last year. Adjusted earnings per share, which exclude nonrecurring items, surpassed expectations at $1.79, beating the FactSet consensus of $1.61.

Revenue Impacted by Traffic Challenges

Cracker Barrel reported 0.8% revenue growth to $836.7 million. However, this missed the FactSet consensus of $841.6 million. The company faced challenges with same-restaurant sales, which only grew by 2.4%, falling short of the 3.1% growth expected by FactSet. Similarly, same-store retail sales declined 6.8%, but outperformed expectations of an 8.1% drop.

Outlook for the First Quarter

Looking ahead, Cracker Barrel expects revenue in the range of $800 million to $850 million for the first quarter. This forecast contrasts with the FactSet consensus estimate of $842 million.

Factors Affecting Performance

Cracker Barrel's recent traffic challenges were primarily driven by a consumer backlash against their diversity, equity, and inclusion campaign. Additionally, the company's Chief Executive, Susan Cochran, announced her retirement plans effective November 1 after serving in the role for 12 years.

Market Reaction

Cracker Barrel's stock closed on Tuesday at its lowest price since April 3, 2020. Over the past three months, the shares have fallen 20.9%, while the S&P 500 has gained 2.1%.