Cracker Barrel Old Country Store Inc. (CBRL) reported a 2% rise in earnings for the first quarter as an increase in comparable store retail sales and higher comparable store restaurant sales drove total revenue higher. The results exceeded analysts’ expectations.
Net income for the quarter increased 2% to $47.2 million or $1.96 per share. Total revenue increased 3.3% to $733.5 million.
Cracker Barrel comparable store restaurant sales increased 1.4%, as a 3% increase in average check offset a 1.6% decline in comparable store restaurant traffic. The average menu price increase was about 2%. Comparable store retail sales grew 4.3% from the prior-year quarter.
Looking ahead into the full year 2019, the company still expects total revenue of about $3.04 billion and earnings of $8.95 to $9.10 per share.
The revenue outlook reflects the expected opening of eight new Cracker Barrel stores as well as projected increases in comparable store restaurant sales growth in the range of flat to 1%. The company now expects comparable store retail sales growth in the range of 1% to 2%. Food commodity inflation is still predicted to be about 2% for the year.
Operating income margin is now expected to be 9% to 9.3% as a percent of total revenue. The company continues to expect depreciation expense of $110 million to $115 million, net interest expense of about $17 million, and capital expenditures of about $160 million to $170 million. The effective tax rate is now projected to be about 17% for fiscal 2019.
For the first quarter, operating income dropped 13% year-over-year and operating income as a percentage of total revenue declined to 8.4% from 10% in the previous year quarter. The decline as a percent was due to the higher cost of goods sold, labor and related expenses, other operating expenses, and general and administrative expenses.
Additionally, the board of directors declared a quarterly dividend of $1.25 per share to its common shareholders. The dividend is payable on February 5, 2019, to shareholders of record on January 18, 2019.
Shares of Cracker Barrel ended Monday’s regular session up 0.98% at $175.01 on the Nasdaq. The stock has risen over 10% in the year so far and over 18% in the past year.