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Jan 29, 2021
Cracker Barrel Q2 2021 Earnings Report
Reported a decrease in revenue due to the resurgence of COVID-19 during the holiday season, which impacted dining room operations and shifted sales mix.
Key Takeaways
Cracker Barrel reported a decrease in total revenue by 20% to $677.2 million for the second quarter of fiscal 2021. Comparable store restaurant sales decreased by 21.9%, while retail sales decreased by 15.3%. The resurgence of COVID-19 impacted sales and margins due to dining room closures, capacity restrictions, and a shift to off-premise business.
COVID-19 resurgence impacted the business during the holiday season, leading to dining room closures and capacity restrictions.
Sales were largely in line with expectations coming out of the first quarter, but monthly sales were volatile.
Shift to off-premise business and operational challenges negatively impacted food waste and labor efficiency.
Company expects to return to stronger levels of performance in the back half of the year.
Cracker Barrel
Cracker Barrel
Forward Guidance
The company anticipates improved trends in both sales and operating income margin in the second half of fiscal year 2021.
Positive Outlook
- Stimulus spending
- Pent-up demand
- Continued vaccinations
- Lower COVID-19 caseload
- Stores gear up to welcome back more loyal guests.
Challenges Ahead
- Widespread and severe weather disruptions in core markets in February
- Comparable store restaurant sales are projected to be down between 11% and 14% from pre-pandemic 2019 levels in Q3
- Comparable store retail sales are projected to be down between 7% and 9% from 2019 in Q3
- Operating income margins are expected to improve between 50 basis points and 100 basis points from Q2 to Q3
- Outlook reflects a number of assumptions, many of which are outside the Company’s control, and a continued uncertain environment occasioned by the pandemic.