CBRL Group, owner of the Cracker Barrel Old Country Stores restaurant chain, has announced results for the first quarter ended 28 October 2005 with net income down as energy prices affected margins.
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Total revenue for the first quarter was $633.4m compared with $612.7m in the year-ago quarter. Net income for the first quarter was $25.7m (including approximately $1.8m of stock option expense after tax), compared to net income of $29.9m in the year-ago quarter.
Comparable store restaurant sales for the first quarter for Cracker Barrel decreased 0.4%, including a 3.8% higher average check, while guest traffic was 4.2% lower. Cracker Barrel’s average menu price increase for the full quarter was approximately 3.7% compared with last year. Comparable store retail sales at Cracker Barrel decreased 11.6% for the quarter.
Logan’s comparable restaurant sales for the quarter were up 0.5% as average check increased 2.3% while guest traffic decreased 1.8%. Logan’s had approximately 2.5% of average menu price increase during the first quarter compared with last year.
During the quarter, the company lost approximately 243 store operating days due to closings for hurricane damage and related power outages. It opened eight new Cracker Barrel units and five new Logan’s company-owned restaurants.
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By GlobalData“We have faced a challenging sales environment this year, as many restaurant and retail companies have reported,” said chairman, president and CEO Michael A. Woodhouse said, ” Restaurant sales at Cracker Barrel were at the low end of our expectations, and retail sales, as well as Logan’s restaurant sales, were below our expectations. In addition, we saw higher utility costs as energy prices increased even more sharply than we expected over year-ago levels. In the face of these challenges, we were pleased that our operating teams showed solid improvements managing product costs and hourly restaurant labour productivity.”
“Our retail sales have been disappointing, reflecting lower restaurant guest traffic and the fact that our customers have been spending less on average per retail purchase,” he said. “On the other hand, we saw only a small decline in the incidence of retail purchases per guest during the quarter, and we continue to believe our strategy aimed at building the frequency of retail purchases by our significant traffic of restaurant guests provides us an opportunity to grow retail sales over time.”
