Cracker Barrel Old Country Store, Inc. is slowly starting to recover from challenging financial circumstances around the COVID-19 pandemic and has reported preliminary financial results of a 16.4% decrease in same-store restaurant sales for the first quarter of 2021 ended October 30, as compared with the same quarter in 2019. The fourth quarter of 2020 ended on July 31 with a same-store sales drop of 39.2%, while the third quarter of 2020 ended May 1with a 41.7% decrease in same-store restaurant sales.
“I'm pleased with our start to the fiscal year and with our continued sales recovery, as we saw significant improvements in comparable store restaurant and retail sales trends,” CEO Sandra Cochran said in a statement. “These results reflect the strength of our brand, our everyday value, and the trust our guests have in us to deliver a safe experience and the hospitality for which we're known.”
The company also received another letter from Cracker Barrel shareholders, Biglari Capital Corp., condemning what they call “troubling” and “false and misleading statements” from the company about their performance and recovery. Activist investor Sadar Biglari of Biglari Capital Group initially sent a letter to shareholders in September criticizing the company’s leadership, and nominating a new director in a fourth attempt to gain a seat on the casual-dining chain’s board.
“Over the prior one-, three-, and five-year periods, Cracker Barrel has woefully underperformed its most relevant peers as well as the S&P MidCap 400 restaurant index,” the most recent letter reads. “The board is not setting the right tone at the top regarding transparency.”
Cracker Barrel addressed these claims in a presentation to shareholders on Nov 3, outlining the company’s history of fiscal performance over the years and citing datapoints like the company’s earnings per share growth from $8.37 EPS in 2017 to $9.27 in 2019. The company presentation also addressed Cracker Barrel’ divestment from Punch Bowl Social, saying that COVID-19 had “an outsized impact” on the business which is driven by “larger, in-person social gatherings and corporate events.”
For the first quarter of 2021, Cracker Barrel expects to report net income of approximately $167 million to $172 million.
The company expects to report full first quarter results in December.
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