Cracker Barrel Reports Results for Third Quarter Fiscal 2013

  Cracker Barrel Reports Results for Third Quarter Fiscal 2013

  Positive Comparable Store Traffic, Restaurant and Retail Sales in Quarter

  Diluted EPS Increased 19% Compared with Adjusted EPS in Prior Year Quarter

         Board Increases Quarterly Dividend by 50% to $0.75 per share

Business Wire

LEBANON, Tenn. -- June 3, 2013

Cracker Barrel Old Country Store, Inc. (“Cracker Barrel” or the “Company”)
(Nasdaq: CBRL) today reported financial results for the third quarter of
fiscal 2013 ended May 3, 2013.

Third-Quarter Fiscal 2013 Highlights

  *Compared to the prior year third quarter, comparable store traffic
    increased 0.7%, comparable store restaurant sales increased 3.1%, and
    comparable store retail sales increased 5.5%.
  *Sixth consecutive quarter of positive comparable traffic, restaurant sales
    and retail sales, and outperformance of the Knapp-Track^TM casual dining
    index.
  *Operating income margin was 6.9% of total revenue, compared with 6.4% in
    the prior year quarter. Adjusted for organizational restructuring
    expenses, operating income margin in the prior year quarter was 6.7%. (See
    non-GAAP reconciliation below.)
  *Earnings per diluted share were $1.02, compared to $0.81 in the prior year
    quarter. Adjusted earnings per diluted share in the prior year quarter
    were $0.86. (See non-GAAP reconciliation below.)
  *Board approves quarterly dividend increase of 50% to $0.75 per share.
    Since November 2011, the Company has tripled its quarterly dividend.
  *The Company raises its guidance range for fiscal 2013 adjusted earnings
    per diluted share to $4.75 to $4.85.

“Driven by strong sales, traffic and operational performance, our earnings
growth for the third quarter exceeded our expectations,” said Sandra B.
Cochran, President and Chief Executive Officer of Cracker Barrel Old Country
Store, Inc. “We believe focusing on our priorities around menu initiatives,
store merchandise, marketing and operations improved our operating margin and
profitability during the quarter. Our diluted earnings per share grew by 19%
over the prior year. This performance enabled us to further enhance
shareholder value by increasing our quarterly dividend by 50%, while we
reduced our debt by $125 million. We remain encouraged by our results and look
to build on our successes in the fourth quarter and into the next fiscal
year.”

Third-Quarter Fiscal 2013 Results

Revenue

The Company reported total revenue of $640.4 million for the third quarter of
fiscal 2013, representing an increase of 5.2% over the third quarter of the
prior year. Comparable store restaurant sales increased 3.1%, including a 2.4%
increase in average check. The average menu price increase for the quarter was
approximately 2.3%. Comparable store retail sales were up 5.5% for the
quarter. The Company estimates that inclement weather in the third quarter
reduced comparable store traffic, restaurant and retail sales by approximately
0.3%. The Company opened one new Cracker Barrel store during the quarter, for
a total of six new store openings year-to-date.

Comparable store restaurant traffic, average check and comparable store
restaurant and retail sales for the fiscal months of February, March and April
were as follows:

                                                        Third
                February       March       April       Quarter
Comparable
restaurant       -1.9%          4.2%        -0.1%       0.7%
traffic
Average          2.5%           2.6%        2.1%        2.4%
check
Comparable
restaurant       0.6%           6.8%        2.0%        3.1%
sales
Comparable
retail           5.2%           13.7%       -0.5%       5.5%
sales

Fiscal 2012 was a 53-week year. For Fiscal 2013, the Company calculates
comparable store traffic, check and sales using the corresponding prior year
weeks.

Operating Income

Operating income was $44.2 million, or 6.9% of total revenue, in the third
quarter of fiscal 2013 compared with $39.1 million, or 6.4% of total revenue,
in the third quarter of the prior year. Adjusted for restructuring expenses,
operating income in the third quarter of the prior year was $40.8 million, or
6.7% of total revenue. Lower hourly labor expense as a percent of total
revenue contributed significantly to the operating income margin improvement.

Dividend Increase and Debt Repayment

The Board of Directors recently increased the quarterly dividend to $0.75 per
share on the Company’s common stock, payable on August 5, 2013 to shareholders
of record as of July 19, 2013. This represents a 50% increase over the
Company’s last quarterly dividend of $0.50.

The Company’s 2006 interest rate swap expired at the end of the third quarter
and the Company paid down $125 million of long-term debt. The Company expects
the lower debt balance and lower interest rates will reduce its annual
interest expense by approximately $25 million, or approximately $0.70 per
diluted share, and expects to recognize $0.17 per diluted share of this
year-over-year benefit during the fourth quarter of 2013.

Fiscal 2013 Outlook

Based upon year-to-date financial performance, recent trends and current
estimates, the Company raised its full-year guidance for fiscal 2013. The
Company expects total revenue of between $2.6 billion and $2.65 billion and
adjusted earnings per diluted share of between $4.75 and $4.85. The revenue
projection for fiscal 2013 reflects the expected opening of eight new Cracker
Barrel stores and projected increases in comparable store restaurant and
retail sales in a range of 2.5% to 3.0%. The Company projects commodity
inflation of between 3.5% and 4.0% and an adjusted operating income margin of
between 7.4% and 7.6% of total revenue for fiscal 2013. The Company expects
capital expenditures of between $75 million and $80 million. The Company
reminds investors that its outlook for fiscal 2013 reflects a number of
assumptions, many of which are outside the Company’s control.

Fiscal 2013 Third-Quarter Conference Call

As previously announced, the live broadcast of Cracker Barrel’s quarterly
conference call will be available to the public on-line at
investor.crackerbarrel.com on June 3, 2013, beginning at 11:00 a.m. (Eastern
Time). An on-line replay will be available at 2:00 p.m. (Eastern Time) and
continue through June 17, 2013.

About Cracker Barrel

Cracker Barrel Old Country Store provides a friendly home-away-from-home in
its old country stores and restaurants. Guests are cared for like family while
relaxing and enjoying real home-style food and shopping that’s surprisingly
unique, genuinely fun and reminiscent of America’s country heritage…all at a
fair price. The restaurants serve up delicious, home-style country food such
as meatloaf and homemade chicken n’ dumplins as well as our signature biscuits
using an old family recipe. The authentic old country retail store is fun to
shop and offers unique gifts and self-indulgences.

Cracker Barrel Old Country Store, Inc.(Nasdaq: CBRL) was established in 1969
in Lebanon, Tenn.and operates 622 company-owned locations in42 states. Every
Cracker Barrel store is open seven days a week with hours Sunday through
Thursday, 6 a.m. – 10 p.m., and Friday and Saturday, 6 a.m. – 11 p.m. For more
information, visit: crackerbarrel.com.

CBRL-F

Except for specific historical information, certain of the matters discussed
in this press release may express or imply projections of revenues or
expenditures, statements of plans and objectives or future operations or
statements of future economic performance. These, and similar statements are
forward-looking statements concerning matters that involve risks,
uncertainties and other factors which may cause the actual performance of
Cracker Barrel Old Country Store, Inc. and its subsidiaries to differ
materially from those expressed or implied by this discussion. All
forward-looking information is subject to completion of our financial
procedures for Q3FY13 and is provided pursuant to the safe harbor established
under the Private Securities Litigation Reform Act of 1995 and should be
evaluated in the context of these factors. Forward-looking statements
generally can be identified by the use of forward-looking terminology such as
"trends," "assumptions," "target," "guidance," "outlook," "opportunity,"
"future," "plans," "goals," "objectives," "expectations," "near-term,"
"long-term," "projection," "may," "will," "would," "could," "expect,"
"intend," "estimate," "anticipate," "believe," "potential," "should,"
"projects," "forecasts," or "continue" (or the negative or other derivatives
of each of these terms) or similar terminology and include the expected
effects of operational improvement initiatives, such as new menu items and
retail offerings. Factors which could materially affect actual results
include, but are not limited to: the effects of uncertain consumer confidence,
higher costs for energy, general or regional economic weakness, weather on
sales and customer travel, and discretionary income or personal expenditure
activity of our customers; our ability to identify, acquire and sell
successful new lines of retail merchandise and new menu items at our
restaurants; our ability to successfully implement or sustain plans intended
to improve operational or marketing execution and performance; changes in or
implementation of additional governmental or regulatory rules, regulations and
interpretations affecting tax, wage and hour matters, health and safety,
pensions, insurance or other undeterminable areas; our ability to successfully
implement plans intended to promote or protect our brands and products;
commodity price increases; the ability of and cost to us to recruit, train,
and retain qualified hourly and management employees in an escalating wage
environment; the effects of increased competition at our locations on sales
and on labor recruiting, cost, and retention; workers' compensation, group
health and utility price changes; consumer behavior based on negative
publicity or concerns over nutritional or safety aspects of our food or
products or those of the restaurant industry in general, including concerns
about pandemics, as well as the possible effects of such events on the price
or availability of ingredients used in our restaurants; the effects of our
substantial indebtedness and associated restrictions on our financial and
operating flexibility and ability to execute or pursue our operating plans and
objectives; changes in interest rates or capital market conditions affecting
our financing costs and ability to refinance all or portions of our
indebtedness; the effects of business trends on the outlook for individual
restaurant locations and the effect on the carrying value of those locations;
the availability and cost of suitable sites for restaurant development and our
ability to identify those sites; changes in land, building materials and
construction costs; the actual results of pending, future or threatened
litigation or governmental investigations and the costs and effects of
negative publicity associated with these activities; practical or
psychological effects of natural disasters or terrorist acts or war and
military or government responses; disruptions to our restaurant or retail
supply chain; changes in foreign exchange rates affecting our future retail
inventory purchases; implementation of new or changes in interpretation of
existing accounting principles generally accepted in the United States of
America; and other factors described from time to time in our filings with the
Securities and Exchange Commission, press releases, and other communications.

Any forward-looking statement made by us herein, or elsewhere, speaks only as
of the date on which made. We expressly disclaim any intent, obligation or
undertaking to update or revise any forward-looking statements made herein to
reflect any change in our expectations with regard thereto or any change in
events, conditions or circumstances on which any such statements are based.

                                                                                                     
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited)
(In thousands, except share and per share amounts, percentages and ratios)

                                                                                                              
                   Third Quarter Ended                                  Nine Months Ended
                                                         Percentage                                           Percentage
                   5/3/13             4/27/12            Change         5/3/13             4/27/12            Change
Total revenue      $ 640,407          $ 608,514          5     %        $ 1,970,529        $ 1,880,185        5     %
Cost of goods       201,982           189,615          7               644,027           611,313          5
sold
Gross profit         438,425            418,899          5                1,326,502          1,268,872        5
Labor and
other related        241,864            235,275          3                719,474            691,176          4
expenses
Other store
operating           116,408           109,947          6               354,859           338,127          5
expenses
Store
operating            80,153             73,677           9                252,169            239,569          5
income
General and
administrative      35,981            34,569           4               105,492           108,500          (3    )
expenses
Operating            44,172             39,108           13               146,677            131,069          12
income
Interest            10,194            11,173           (9    )         31,199            33,333           (6    )
expense
Pretax income        33,978             27,935           22               115,478            97,736           18
Provision for       9,376             8,961            5               32,516            29,351           11
income taxes
Net income         $ 24,602           $ 18,974           30             $ 82,962           $ 68,385           21
                                                                                                              
Earnings per       $ 1.04            $ 0.82            27             $ 3.50            $ 2.97            18
share – Basic:
Earnings per
share –            $ 1.02            $ 0.81            26             $ 3.47            $ 2.93            18
Diluted:
                                                                                                              
Weighted
average
shares:
Basic                23,760,589         23,132,730       3                23,683,133         22,990,544       3
Diluted              24,006,821         23,535,765       2                23,913,226         23,329,230       3
                                                                                                              
Ratio Analysis
Total revenue:
Restaurant           81         .6%     82         .2%                    78         .9%     79         .0%
Retail              18         .4     17         .8                    21         .1     21         .0
Total revenue        100        .0      100        .0                     100        .0      100        .0
Cost of goods       31         .5     31         .2                    32         .7     32         .5
sold
Gross profit         68         .5      68         .8                     67         .3      67         .5
Labor and
other related        37         .8      38         .6                     36         .5      36         .8
expenses
Other store
operating           18         .2     18         .1                    18         .0     18         .0
expenses
Store
operating            12         .5      12         .1                     12         .8      12         .7
income
General and
administrative      5          .6     5          .7                    5          .4     5          .7
expenses
Operating            6          .9      6          .4                     7          .4      7          .0
income
Interest            1          .6     1          .8                    1          .5     1          .8
expense
Pretax income        5          .3      4          .6                     5          .9      5          .2
Provision for       1          .5     1          .5                    1          .7     1          .6
income taxes
Net income          3          .8%    3          .1%                   4          .2%    3          .6%
                                                                                                              

                                                       
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited and in thousands, except share amounts)
                                                                  
                                                                  
                                               5/3/13             8/3/12
Assets
Cash and cash equivalents                      $ 58,457           $ 151,962
Property held for sale                           884                884
Accounts receivable                              14,406             14,609
Income tax receivable                            1,435
Inventory                                        134,131            143,267
Prepaid expenses                                 16,016             11,405
Deferred income taxes                            7,407              15,181
Property and equipment, net                      1,016,811          1,022,370
Other long-term assets                          60,126            59,314
Total assets                                   $ 1,309,673        $ 1,418,992
                                                                  
Liabilities and Shareholders’
Equity
Accounts payable                               $ 72,732           $ 101,271
Other current liabilities                        183,127            217,788
Long-term debt                                   400,000            525,036
Interest rate swap liability                     16,888             14,166
Other long-term obligations                      119,855            114,897
Deferred income taxes                            61,739             63,159
Shareholders’ equity, net                       455,332           382,675
Total liabilities and                          $ 1,309,673        $ 1,418,992
shareholders’ equity
                                                                  
Common shares issued and                         23,757,956         23,473,024
outstanding
                                                                    

                                          
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
(Unaudited and in thousands)
                                                
                                                Nine Months Ended
                                                5/3/13          4/27/12
Cash flows from operating activities:
Net income                                      $ 82,962           $ 68,385
Depreciation and amortization                     49,000             47,742
Loss on disposition of property and               2,324              1,832
equipment
Share-based compensation, net of                  9,035              7,509
excess tax benefit
Decrease in inventories                           9,136              10,543
(Decrease) in accounts payable                    (28,539  )         (12,023 )
Net changes in other assets and                  (17,219  )        17,897  
liabilities
Net cash provided by operating                   106,699          141,885 
activities
Cash flows from investing activities:
Purchase of property and equipment,               (45,738  )         (56,766 )
net of insurance recoveries
Proceeds from sale of property and               550              491     
equipment
Net cash used in investing activities            (45,188  )        (56,275 )
Cash flows from financing activities:
Net payments for credit facilities                (125,087 )         (104    )
and other long-term obligations
Proceeds from exercise of share-based             5,195              16,729
compensation awards
Excess tax benefit from share-based               1,961              1,921
compensation
Purchase and retirement of common                 (3,570   )         (12,279 )
stock
Deferred financing costs                          0                  (263    )
Dividends on common stock                        (33,515  )        (16,568 )
Net cash used in financing activities            (155,016 )        (10,564 )
                                                                   
Net (decrease) increase in cash and               (93,505  )         75,046
cash equivalents
Cash and cash equivalents, beginning              151,962            52,274
of period
Cash and cash equivalents, end of               $ 58,457          $ 127,320 
period
                                                                   

                                             
CRACKER BARREL OLD COUNTRY STORE, INC.
Supplemental Information
(Unaudited)
                                                   
                       Third Quarter Ended         Nine Months Ended
                        5/3/13     4/27/12      5/3/13       4/27/12
                                                                   
Units in
operation:
Open at
beginning of             621           608           616             603
period
Opened during           1            5            6              10
period
Open at end of           622           613           622             613
period
                                                                   
Total revenue:
(In thousands)
Restaurant             $ 522,642     $ 500,025       1,555,111       1,485,065
Retail                  117,765      108,489      415,418        395,120
Total revenue          $ 640,407     $ 608,514     $ 1,970,529     $ 1,880,185
                                                                   
Cost of goods
sold: (In
thousands)
Restaurant             $ 141,617     $ 135,301     $ 423,138       $ 401,453
Retail                  60,365       54,314       220,889        209,860
Total cost of          $ 201,982     $ 189,615     $ 644,027       $ 611,313
goods sold
Average unit
volume: (In                          
thousands)
Restaurant             $ 840.8       $ 817.9       $ 2,506.5       $ 2,443.4
Retail                  189.4        177.4        669.6          650.1
Total                  $ 1030.2      $ 995.3       $ 3,176.1       $ 3,093.5
                                                                   
Operating weeks:       8,081         7,948         24,197          23,704
                                                                   

                                                      
                                       Q3 2013 vs. Q3         9 mo. 2013 vs. 9
                                       2012                   mo. 2012
                                                              
Comparable store sales period to
period increase:
Restaurant                             3.1%                   3.2%
Retail                                 5.5%                   3.4%
                                                              
Number of locations in                 603                    596
comparable store base
                                                             


CRACKER BARREL OLD COUNTRY STORE, INC.
Reconciliation of GAAP basis operating
results to adjusted non-GAAP operating results
(Unaudited and in thousands)

The Company makes reference in this release to “adjusted operating income,”
“adjusted net income,” “adjusted earnings per diluted share,” and “adjusted
general and administrative expenses,” excluding the impact of severance and
proxy contest expenses and the retroactive restatement of the work
opportunities tax credit. The Company believes that excluding these items and
their related tax effects from its financial results reflects operating
results that are more indicative of the Company's ongoing operating
performance while improving comparability to prior periods, and as such, may
provide investors with an enhanced understanding of the Company's past
financial performance and prospects for the future. This information is not
intended to be considered in isolation or as a substitute for operating
income, net income, or earnings per share or expense information prepared in
accordance with GAAP.


                                                                                        
                         Third Quarter ended May 3, 2013                      Third Quarter ended April 27, 2012
                         As              Adjust           As                  As              Adjust (2)       As
                         Reported                         Adjusted            Reported                         Adjusted
                                                                                                               
Store
operating                $ 80,153        $ -              $ 80,153            $ 73,677        $ -              $ 73,677
income
General and
administrative            35,981      -           35,981             34,569      (1,660 )     32,909
expenses
Operating                  44,172          -                44,172              39,108          1,660            40,768
income
Interest                  10,194      -           10,194             11,173      -           11,173
Expense
Pretax income              33,978          -                33,978              27,935          1,660            29,595
Provision for             9,376       -           9,376              8,961       532         9,493
income taxes
Net income               $ 24,602     $ -          $ 24,602            $ 18,974     $ 1,128      $ 20,102
                                                                                                               
Earning per              $ 1.04          $ -              $ 1.04              $ 0.82          $ 0.05           $ 0.87
share - Basic
Earning per
share -                  $ 1.02          $ -              $ 1.02              $ 0.81          $ 0.05           $ 0.86
Diluted
                                                                                                               
                                                                                                               
                         Nine months ended May 3, 2013                        Nine months ended April 27, 2012
                         As              Adjust (1)       As                  As              Adjust (1)       As
                         Reported        (2) (3)          Adjusted            Reported        (2)              Adjusted
                                                                                                               
Store
operating                $ 252,169       $ -              $ 252,169           $ 239,569       $ -              $ 239,569
income
General and
administrative            105,492     (5,634 )     99,858             108,500     (6,863 )     101,637
expenses
Operating                  146,677         5,634            152,311             131,069         6,863            137,932
income
Interest                  31,199      -           31,199             33,333      -           33,333
Expense
Pretax income              115,478         5,634            121,112             97,736          6,863            104,599
Provision for             32,516      3,847       36,363             29,351      2,061       31,412
income taxes
Net income               $ 82,962     $ 1,787      $ 84,749            $ 68,385     $ 4,802      $ 73,187
                                                                                                               
Earning per              $ 3.50          $ 0.08           $ 3.58              $ 2.97          $ 0.21           $ 3.18
share - Basic
Earning per
share -                  $ 3.47          $ 0.07           $ 3.54              $ 2.93          $ 0.21           $ 3.14
Diluted
                                                                                                               

(1)  Charges and tax effects of the proxy contest concluded at the Company's
      annual meeting of shareholders.
(2)   Severance, other charges and tax effects related to organizational
      changes.
      Provision for taxes adjusted to exclude the $2.1 million prior year
(3)   favorable effect of the retroactive reinstatement of the work
      opportunity tax credit.
      

Contact:

Cracker Barrel Old Country Store, Inc.
Investors:
Lawrence E. Hyatt, 615-235-4432
or
Media:
Jeanne Ludington, 615-443-9115
 
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