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Cracker Barrel (CBRL) Q3 Earnings & Revenues Beat Estimates

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Cracker Barrel Old Country Store, Inc. (CBRL - Free Report) reported third-quarter fiscal 2021 (ended Apr 30, 2021) results, wherein earnings and revenues beat the Zacks Consensus Estimate. Moreover, the top and the bottom lines improved on a year-over-year basis.

The company benefited from easing of dining room capacity restrictions, average weekly sales volumes improvement courtesy of increase in dine-in traffic, retained off-premise volumes, and robust retail performance. The company’s average per-store restaurant sales volumes increased to nearly $70,000 per fiscal week in April from approximately $55,500 per fiscal week in fiscal January.

Cracker Barrel president and CEO Sandra B. Cochran said, “The pace of our sales and margin recovery in the quarter exceeded expectations as we welcomed guests back into our dining rooms and our off-premise business remained strong.”

Earnings & Revenues

During the fiscal third quarter, adjusted earnings per share of $1.51 beat the Zacks Consensus Estimate of 10 cents. In the prior year quarter, the company reported adjusted loss per share of $1.81.

Revenues of $713.4 million during the quarter beat the consensus mark of $666 million. However, the figure declined 64.9% on a year-over-year basis. The company benefited from improvement in both restaurant and retail comparable store sales.

Comps Details

Comparable store restaurant sales declined 8.6% in the reported quarter compared with the same period in fiscal 2019. However, comparable store restaurant sales surged 56.5% year over year. Moreover, comparable retail sales jumped 10.8% and 102.8%, compared with same period in 2019 and 2020, respectively.
    
During the fiscal third quarter, comparable store off-premise sales soared 144% over the more normalized third-quarter fiscal 2019.

Operating Highlights

During the fiscal third quarter, cost of goods sold (exclusive of depreciation and rent) decreased 280 basis points (bps) year over year to 28.9%. General and administrative expenses contracted 130 bps year over year to 5.2%.

Operating income in the fiscal third quarter totaled $52.5 million against ($79) million in the prior-year quarter. Adjusted operating margin came in at 7.8%. Margin benefited from better-than-expected sales performance, particularly in the company’s retail business. Adjusted operating income was $55.7 million.

Balance Sheet

As of Apr 30, 2021, cash and cash equivalents were $384.6 million, up from $363.3 million as of May 1, 2020.

Inventory at the end of the fiscal third quarter amounted to $132.4 million, down from $146.3 million at the end of third-quarter fiscal 2020.

Long-term debt amounted to $575.3 million at the end of the quarter, up from $940 million at the end of the prior-year quarter.

For the nine-months ended Apr 30, 2021, net cash provided by operating activities amounted to $212.5 million compared with $87.2 million in the year-ago period.

Q4 Outlook

Going forward, the company expects improvement in sales and operating margin on the back of stimulus spending, pent-up demand, continued vaccinations and a lower COVID-19 caseload. In fourth-quarter fiscal 2021, the company’s revenues is likely to be nearly flat to fourth-quarter fiscal 2019 total revenues. It anticipates capital expenditure of nearly $25 million. Commodity inflation is expected at approximately 5%. Meanwhile, effective tax rate for quarter is anticipated between 11% and 12%.

Store Updates

Post the acquisition of Maple Street Biscuit Company in October 2019, the company converted six Holler & Dash units into Maple Street locations and closed one Holler & Dash unit permanently. With one opening in the fiscal third quarter, the total number of company-owned Maple units under operation was 37.

As of Apr 30, 2021, the company had 664 Cracker Barrel units and 37 Maple units, making it a total of 701 company-owned units under operation.

Cracker Barrel currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peer Releases

Yum! Brands, Inc. (YUM - Free Report) reported strong first-quarter 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The metrics increased year over year. The company’s adjusted earnings of $1.07 beat the Zacks Consensus Estimate of 85 cents. In the prior-year quarter, the company had reported adjusted earnings of 64 cents. Quarterly revenues of $1,486 million surpassed the consensus estimate of $1,461 million. The top line also rose 17.7% year over year. The upside can be attributed to increase in sales along with rise in franchise and property revenues.

McDonald's Corporation (MCD - Free Report) reported first-quarter 2021 results, with earnings and revenues outpacing the Zacks Consensus Estimate. The company reported adjusted earnings of $1.92 per share, which surpassed the Zacks Consensus Estimate of $1.81. Moreover, the bottom line rose 31% year over year. Quarterly revenues of $5,124.6 million beat the Zacks Consensus Estimate of $5,047 million. Moreover, the figure rose 9% year over year. The top line benefited from increase in global comparable sales.

Starbucks Corporation (SBUX - Free Report) reported second-quarter fiscal 2021 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The company reported adjusted EPS of 62 cents, which beat the Zacks Consensus Estimate of 52 cents. In the prior-year quarter, the company had reported adjusted EPS of 32 cents. Meanwhile, quarterly revenues of $6,668 million missed the Zacks Consensus Estimate of $6,803 million. However, the top line increased 11.2% from the year-ago quarter’s levels. The uptick was driven by growth in comparable store sales, partially offset by the unfavorable impact of Global Coffee Alliance transition-related activities.

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