Cracker Barrel Old Country Store Inc. will open a second Holler & Dash Biscuit House restaurant this summer in Tuscaloosa, Ala., the company CEO said Wednesday.
Lebanon, Tenn.-based Cracker Barrel opened the first Holler & Dash in March, in Homewood, Ala. The fast-casual concept has a more limited menu and service than a traditional Cracker Barrel restaurant, and is open only from 7 a.m. to 2 p.m. daily.
“We were pleased with our first Holler & Dash Biscuit House opening,” said Sandra Cochran, Cracker Barrel CEO and president, in an earnings call with analysts. “The guest response has been very positive. We expect to open our second Holler & Dash during the fourth quarter in Tuscaloosa, Ala.” The Tuscaloosa location will have expanded weekend hours, opening from 7 a.m. to 9 p.m. on Fridays and Saturdays, the company said.
Cochran cautioned that the new concept will not have a significant impact on earnings for several years.
“While we are excited about this brand, I want to emphasize that we do not expect it to have a meaningful impact on financial results for the next one to two years,” she said.
For the third quarter ended April 29, Cracker Barrel reported that profit rose 39.2 percent, to $49.2 million, or $2.04 per share, from $35.3 million, or $1.47 per share, in the same period last year. Excluding special items, earnings were $1.82 per share.
Restaurant traffic in the quarter slipped 0.6 percent, the company said, but same-store restaurant sales increased 2.3 percent, with average menu prices rising 2.9 percent. Same-store retail sales grew 2.2 percent.
Sales in the quarter were choppy by month, said Lawrence Hyatt, Cracker Barrel chief financial officer, who will retire on June 6 and be succeeded by Jill Golder, formerly of Ruby Tuesday Inc.
“As Larry said earlier in the call, the consumer continues to be a bit of a mystery,” Cochran said, explaining a weakness in April customer traffic. “What might be reflected in April may be a continuation of the choppiness that he [Hyatt] described and that we see and are, to some degree, assuming we may continue to see.”
Hyatt said Cracker Barrel expects to see modest impact from new Department of Labor overtime rules to come in December for exempt employees.
“We have in very round numbers approximately 3,500 salaried store managers,” Hyatt said. “We anticipate on the basis of the final rules that that the DOL just recently announced that fewer than 3 percent of those salaried store managers will be below the new DOL salary threshold.”
The final rule doubled the salary threshold for employees to be considered exempt from $23,360 to $47,476, meaning that managers would have to receive at least $47,460 to considered salaried workers.
Hyatt said that the company was evaluating its management structure to see if there were additional changes that it should make.
“We think that this will be very manageable for us,” Hyatt said.
Cracker Barrel Old Country Store owns and operates 636 locations in 42 states.
Update: June 1, 2016 This story has been updated to note expanded hours at the second Holler & Dash location.