CBRL Group, Inc. Announces 38.5% Third Quarter EPS Increase, Announces Additional Share Repurchase Authorization.Business Editors LEBANON Lebanon, country, Asia Lebanon (lĕb`ənən, –nŏn'), officially Republic of Lebanon, republic (2005 est. pop. 3,826,000), 4,015 sq mi (10,400 sq km), SW Asia. , Tenn.--(BUSINESS WIRE)--May 23, 2002 Reports Current Sales Trends and Updates Earnings Guidance for Remainder of Fiscal 2002 CBRL CBRL CBRL Group, Inc (stock symbol) CBRL Council for British Research in the Levant (UK) Group, Inc. (the "Company") (Nasdaq:CBRL) today announced results for its third quarter of fiscal 2002 ended May 3, 2002, reporting diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of of $0.36, up 38.5% from $0.26 in the year-earlier period. The Company also announced a new 1.5 million share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. authorization The right or permission to use a system resource; the process of granting access. See access control. , disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). information on current trends and updated earnings guidance for the fiscal fourth quarter and full year. Highlights of the quarter and update of trends and guidance included:
-- Diluted earnings per share for the third fiscal quarter up 38.5% and net
income up 40.8% from the third quarter of fiscal 2001, on a 7.9% increase in
revenues.
-- Store operating income margins for the quarter improved 1.1% as a percent of
revenues compared with a year earlier.
-- Comparable store sales up 4.7% and 1.1% for the Company's Cracker Barrel Old
Country Store(R) ("Cracker Barrel") restaurant and retail operations,
respectively, marking the ninth consecutive quarter of positive restaurant
sales and eleventh consecutive quarter of positive restaurant guest traffic.
-- Comparable store sales increased 3.4% in the Company's Logan's Roadhouse(R)
("Logan's") restaurants.
-- Just over 5 million shares of the Company's outstanding common stock have
been repurchased at an average price of $27.87 this fiscal year, and the
Company announced a new authorization to repurchase an additional 1.5 million
shares.
-- Comparable store restaurant sales trends thus far in the fourth quarter are
up approximately 6.5-7% quarter-to-date in Cracker Barrel and 3.5-4% in
Logan's.
-- Fourth quarter-to-date retail sales trends in Cracker Barrel are up
approximately 5.5-6%.
-- Diluted earnings per share guidance in the low-to-mid $0.50's for the fourth
fiscal quarter, compared with $0.48 in the prior fiscal year after adjusting
for certain charges taken a year ago; the prior year earnings of $0.48 included
approximately $0.09 for a non-recurring 14th week.
Revenue for the third quarter ended May 3, 2002, of $505 million increased 7.9% compared with $468 million in the fiscal third quarter of 2001. Comparable store sales for the Cracker Barrel This article is about the restaurant-and-store chain. For the unrelated company marketing cheeses bearing the "Cracker Barrel" trademark, see Kraft Foods. Cracker Barrel Old Country Store, Inc. concept increased 4.7% for restaurants, including 1.7% higher guest traffic, and 1.1% in retail. The Cracker Barrel restaurant sales increase also reflected a 3.0% higher average check, which included approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 2.1% of year-over-year higher menu pricing and favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. mix effects, including a highly successful in-store promotion for "Homestyle Chicken." The Logan's concept achieved 3.4% higher comparable store sales, including a 3.0% increase in guest traffic. During the quarter, the Company opened six new Cracker Barrel units and one new company-operated and one franchised Logan's restaurant. The Company reported net income for the third quarter of fiscal 2002 of $20.6 million, or $0.36 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, reflecting increases of 40.8% and 38.5%, respectively, from net income of $14.6 million and diluted earnings per share of $0.26 for the third quarter of fiscal 2001. Store operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. margins improved from 11.1% of revenue a year ago to 12.2% in this year's third fiscal quarter, an improvement in margin of 1.1% as a percent of revenues, reflecting lower cost of goods sold Cost of goods sold The total cost of buying raw materials, and paying for all the factors that go into producing finished goods. cost of goods sold and other store operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. , partly offset by higher labor and related expenses. The higher labor and related expenses reflected higher management compensation including store bonuses, and higher workers' compensation workers' compensation, payment by employers for some part of the cost of injuries, or in some cases of occupational diseases, received by employees in the course of their work. expense. For the nine months ended May 3, 2002, revenue was $1,523 million compared with $1,420 million for the first nine months of fiscal 2001, an increase of 7.3%. Comparable store restaurant sales for Cracker Barrel were up 5.7% from a year ago, including 2.7% higher guest traffic, and comparable store retail sales grew 2.4%. For Logan's, comparable store sales during the first nine months of fiscal 2002 increased 2.8%, with a 2.6% increase in guest traffic. The Company opened 14 new Cracker Barrel units and nine new company-operated and three franchised Logan's restaurants during the first nine months of the year. Net income for the Company for the nine-month period of $61.3 million, or $1.08 per diluted share, rose from $46.6 million, or $0.82 per diluted share, during the nine months of last year, each reflecting increases of 31.7%. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. store operating income margin improved 0.8% as a percent of revenues, from 11.4% to 12.2%. Commenting on the results, CBRL Group, Inc. President and Chief Executive Officer Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. A. Woodhouse Wood´house` n. 1. A house or shed in which wood is stored, and sheltered from the weather. said, "We are pleased to report that our third quarter performance was at the high end of our expectations, repeating the higher than expected performance achieved in the second quarter. Sales and guest traffic continued to be strong in all areas of our business. While labor costs, especially store bonuses related to the strong quarterly performance and further unfavorable development of prior years' workers' compensation claims from our independently determined actuarial ac·tu·ar·y n. pl. ac·tu·ar·ies A statistician who computes insurance risks and premiums. [Latin estimates, were a pressure point, we still recorded a significant improvement in operating income margins, evidencing the continued improving performance of our business." The Company urges caution in considering its current trends and the earnings targets disclosed in this press release. The restaurant industry is highly competitive, and trends and targets are subject to numerous factors and influences, some of which are discussed in the cautionary language at the end of this press release. The Company assumes no obligation to update disclosed information on trends or targets other than in its periodic filings under Forms 10-K, 10-Q, and 8-K with the Securities and Exchange Commission. The Company reported that fourth quarter-to-date comparable store restaurant sales in its Cracker Barrel units are up approximately 6.5-7% compared with the same period a year ago, including almost 4% higher guest traffic. Quarter-to-date retail sales in the comparable units are up approximately 5.5-6%. Quarter-to-date comparable store sales in the Company's Logan's restaurants are up approximately 3.5-4% from last year, more than accounted for by higher guest traffic, with the average guest check down as a result of product mix changes including lower alcohol sales. Logan's sales comparisons recently have benefited from prior year softness in late April and early May. The Company's present guidance for diluted earnings per share for the fourth quarter of fiscal 2002, which ends on August 2, 2002, is in the low-to-mid $0.50's, compared with $0.48 after excluding the impact of certain charges taken in the year-ago quarter. Last year's fourth quarter benefited approximately $0.09 from the non-recurring effect of a 14th week, which was included in the adjusted $0.48 per share. Earnings guidance reflects many assumptions, most of which cannot be known with certainty CERTAINTY, UNCERTAINTY, contracts. In matters of obligation, a thing is certain, when its essence, quality, and quantity, are described, distinctly set forth, Dig. 12, 1, 6. It is uncertain, when the description is not that of one individual object, but designates only the kind. Louis. , including very importantly, sales expectations. Present guidance is based on Cracker Barrel restaurant and retail comparable store sales generally in the 4-6% and 4-5% ranges, respectively, and Logan's comparable store sales generally in the 2-3% range. The Company expects to open six new Cracker Barrel units in the fourth fiscal quarter, and no company-operated and one franchised Logan's restaurant in the fourth fiscal quarter. Thus far this fiscal year, the Company has repurchased just over 5 million shares of its common stock for total consideration of $140.3 million, or approximately $27.87 per share. These purchases were made under the Company's previously authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: three-million-share repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. program and a previously reported $60 million repurchase executed executed 1) adj. to have been completed. (Example: "it is an executed contract") 2) v. to have completed or fully performed. (Example: "he executed all the promises made in the contract") 3) v. simultaneously si·mul·ta·ne·ous adj. 1. Happening, existing, or done at the same time. See Synonyms at contemporary. 2. Mathematics with the issuance of zero-coupon ze·ro-cou·pon adj. Paying no interest to the holder until maturity or sale: a zero-coupon bond. senior convertible notes earlier in the quarter. The Company announced that its Board has authorized the repurchase of 1.5 million shares in addition to the fewer than 100,000 shares remaining to be repurchased under prior authorizations prior authorization, n See predetermination. prior authorization Health insurance A cost containment measure that provides full payment of health benefits only if the hospitalization or medical treatment has been . Such repurchases are expected to be made from time to time in open market transactions. Headquartered in Lebanon, Tennessee
Lebanon is a city in Wilson County, Tennessee, in the United States. The population was 20,235 at the 2000 census. , CBRL Group, Inc. presently operates 453 Cracker Barrel Old Country Store restaurants and gift shops located in 41 states and 84 company-operated and 12 franchised Logan's Roadhouse Logan's Roadhouse is a chain of restaurants that was founded in 1991, and in 1999 became a wholly owned subsidiary of the publicly held CBRL Group, Inc (which also owns Cracker Barrel). restaurants in 17 states. Except for specific historical information, the matters discussed in this press release are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve risks, uncertainties and other factors that may cause actual results and performance of CBRL Group, Inc. to differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by this discussion. All forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information is provided by the Company pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. established under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and 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 The terminology used in the computer and telecommunications field adds tremendous confusion not only for the lay person, but for the technicians themselves. What many do not realize is that terms are made up by anybody and everybody in a nonchalant, casual manner without any regard or such as "assumptions", "target", "guidance", "plans", "may", "will", "would", "expect", "intend", "estimate", "anticipate", "believe", "potential" or "continue" (or the negative of each of these terms) or similar terminology. Factors which will affect actual results include, but are not limited to: adverse general economic conditions including uncertain consumer confidence effects on sales; the actual results of pending or threatened litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. ; the effects of negative publicity; commodity, workers' compensation, group health and utility price changes; weather conditions and customer travel activity; the effects of plans intended to improve operational execution and performance; the effects of increased competition at Company locations on sales and on labor recruiting, cost and retention; the ability of and cost to the Company to recruit RECRUIT. A newly made soldier. , train and retain qualified restaurant hourly and management employees; the ability of the Company to identify successful new lines of retail merchandise MERCHANDISE. By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain ; the availability and cost of acceptable sites for development; the acceptance of the Company's concepts as the Company continues to expand into new markets and geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. regions; changes in interest rates affecting the Company's financing costs; changes in or implementation of additional governmental or regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. rules and regulations affecting accounting, wage and hour matters, health and safety, pensions and insurance; practical or psychological effects of terrorist acts, or military or government responses; other undeterminable areas of government or regulatory actions or regulations; and other factors described from time to time in the Company's filings with the Securities and Exchange Commission, press releases and other communications.
CBRL GROUP, INC.
CONSOLIDATED INCOME STATEMENT (Unaudited)
(In thousands, except per share amounts)
Third Quarter Ended
-----------------------------------
Net sales: 5/3/02 4/27/01 Change
-------- --------- ------
Restaurant $413,866 $379,365 9%
Retail 90,864 88,546 3
-------- ---------
Net sales 504,730 467,911 8
Franchise fees and royalties 320 190 68
-------- ---------
Total revenue 505,050 468,101 8
Cost of goods sold 161,262 155,668 4
-------- ---------
Gross profit 343,788 312,433 10
Labor & other related expenses 195,696 178,542 10
Other store operating expenses 86,486 81,970 6
-------- ---------
Store operating income 61,606 51,921 19
General and administrative 28,347 24,657 15
Amortization of goodwill -- 999 (100)
-------- ---------
Operating income 33,259 26,265 27
Interest expense 1,535 3,014 (49)
Interest income -- 30 (100)
-------- ---------
Pretax income 31,724 23,281 36
Provision for income taxes 11,167 8,684 29
-------- ---------
Net income $20,557 $14,597 41
======== =========
Earnings per share:
Basic $0.38 $0.26 46
Diluted $0.36 $0.26 38
Weighted average shares:
Basic 54,548 56,016 (3)
Diluted 56,693 56,911 --
Nine Months Ended
------------------------------------
Net Sales: 5/3/02 4/27/01 Change
---------- ---------- ----------
Restaurant $1,200,779 $1,103,810 9%
Retail 321,184 315,258 2
---------- ---------- ----------
Net sales 1,521,963 1,419,068 7
Franchise fees and royalties 802 555 45
---------- ---------- ----------
Total revenue 1,522,765 1,419,623 7
Cost of goods sold 506,194 486,279 4
---------- ---------- ----------
Gross profit 1,016,571 933,344 9
Labor & other related expenses 573,899 525,560 9
Other store operating expenses 255,718 245,524 4
---------- ---------- ----------
Store operating income 186,954 162,260 15
General and administrative 87,095 75,256 16
Amortization of goodwill -- 2,996 (100)
---------- ---------- ----------
Operating income 99,859 84,008 19
Interest expense 4,616 9,790 (53)
Interest income -- 84 (100)
---------- ---------- ----------
Pretax income 95,243 74,302 28
Provision for income taxes 33,907 27,715 22
---------- ---------- ----------
Net income $61,336 $46,587 32
========== ========== ==========
Earnings per share:
Basic $1.12 $0.83 35
Diluted $1.08 $0.82 32
Weighted average shares:
Basic 54,994 56,450 (3)
Diluted 56,823 57,113 (1)
Third Quarter Ended
---------------------
5/3/02 4/27/01
-------- ---------
Ratio Analysis
--------------
Net sales:
Restaurant 81.9% 81.1%
Retail 18.0 18.9
----- -----
Net sales 99.9 100.0
Franchise fees and royalties 0.1 --
----- -----
Total revenue 100.0 100.0
Cost of goods sold 31.9 33.3
----- -----
Gross profit 68.1 66.7
Labor & other related expenses 38.8 38.1
Other store operating expenses 17.1 17.5
----- -----
Store operating income 12.2 11.1
General and administrative 5.6 5.3
Amortization of goodwill -- 0.2
----- -----
Operating income 6.6 5.6
Interest expense 0.3 0.6
Interest income -- --
----- -----
Pretax income 6.3 5.0
Provision for income taxes 2.2 1.9
----- -----
Net income 4.1% 3.1%
===== =====
Nine Months Ended
-----------------------
5/3/02 4/27/01
-------- ---------
Ratio Analysis
--------------
Net sales:
Restaurant 78.9% 77.8%
Retail 21.1 22.2
----- -----
Net sales 100.0 100.0
Franchise fees and royalties -- --
----- -----
Total revenue 100.0 100.0
Cost of goods sold 33.3 34.3
----- -----
Gross profit 66.7 65.7
Labor & other related expenses 37.7 37.0
Other store operating expenses 16.8 17.3
----- -----
Store operating income 12.2 11.4
General and administrative 5.7 5.3
Amortization of goodwill -- 0.2
----- -----
Operating income 6.5 5.9
Interest expense 0.3 0.7
Interest income -- --
----- -----
Pretax income 6.2 5.2
Provision for income taxes 2.2 1.9
----- -----
Net income 4.0% 3.3%
===== =====
CONSOLIDATED CONDENSED BALANCE SHEET
(Unaudited)
(In thousands)
5/3/02 8/3/01
----------- -----------
Assets
Cash and cash equivalents $ 31,981 $ 11,807
Other current assets 142,171 143,383
Property and equipment, net 976,607 955,028
Goodwill, net 92,882 92,882
Other assets 15,622 9,772
----------- -----------
Total assets $ 1,259,263 $ 1,212,872
=========== ===========
Liabilities and Stockholders'
Equity
Current liabilities $ 206,836 $ 197,249
Long-term debt 195,174 125,000
Other long-term obligations 46,074 44,515
Stockholders' equity 811,179 846,108
----------- -----------
Total liabilities and
stockholders' equity $ 1,259,263 $ 1,212,872
=========== ===========
CONSOLIDATED CONDENSED CASH FLOW STATEMENT
(Unaudited)
(In thousands)
Nine Months Ended
-----------------------------
5/3/02 4/27/01
------------ -----------
Cash flow from operating activities:
Net income $ 61,336 $ 46,587
Depreciation and amortization 46,012 48,031
(Gain) loss on disposition of
property and equipment (413) 80
Net changes in other assets
and liabilities 6,626 (2,137)
----------- ----------
Net cash provided by operating
activities 113,561 92,561
----------- -----------
Cash flows from investing activities:
Purchase of property and
equipment (69,997) (74,624)
Net proceeds from sale of
property and equipment 3,228 141,502
----------- -----------
Net cash provided by investing
activities (66,769) 66,878
----------- -----------
Cash flows from financing activities:
Proceeds from issuance of
long-term debt 492,556 253,700
Principal payments under long-
term debt and other
long-term obligations (422,909) (395,876)
Proceeds from exercise of
stock options 45,215 4,007
Purchases and retirement of
common stock (140,317) (23,823)
Dividends on common stock (1,163) (1,185)
----------- -----------
Net cash used in financing activities (26,618) (163,177)
----------- ------------
Net increase (decrease) in cash and
cash equivalents 20,174 (3,738)
Cash and cash equivalents, beginning
of period 11,807 13,865
----------- -----------
Cash and cash equivalents, end
of period $ 31,981 $ 10,127
=========== ===========
CBRL GROUP, INC.
Supplemental Information
As of As of As of
5/3/02 8/3/01 4/27/01
---------- ---------- ----------
Common shares outstanding 52,504,414 55,026,846 55,690,902
========== ========== ==========
Units in operation:
Cracker Barrel 451 437 439
Carmine Giardini's Gourmet Market(a) -- -- 3
Logan's Roadhouse - company-owned 84 75 78
---------- ---------- ---------
Total company-owned units 535 512 520
Logan's Roadhouse - franchised 11 8 8
---------- ---------- ---------
System-wide units 546 520 528
========== ========== =========
Third Quarter Ended
-----------------------------
Net sales in company-owned stores: 5/3/02 4/27/01
(In thousands) ------------- -------------
Cracker Barrel - restaurant $ 349,989 $ 321,313
Cracker Barrel - retail 90,864 85,388
-------------- -------------
Cracker Barrel - total 440,853 406,701
Carmine Giardini's Gourmet Market(a) -- 4,606
Logan's Roadhouse 63,877 56,604
-------------- -------------
Total net sales $ 504,730 $ 467,911
============== =============
Operating weeks - company-owned stores:
Cracker Barrel 5,829 5,674
Logan's Roadhouse 1,088 999
Average comparable store sales -
company-owned stores: (In thousands)
Cracker Barrel - restaurant $ 778.6 $ 743.8
Cracker Barrel - retail 202.5 200.3
------------ ------------
Cracker Barrel - total $ 981.1 $ 944.1
============ ============
Logan's Roadhouse $ 758.0 $ 733.3
============ ============
Capitalized interest $ 79 $ 148
============ ============
Nine Months Ended
-------------------------------
Net sales in company-owned stores: 5/3/02 4/27/01
(In thousands) -------------- --------------
Cracker Barrel - restaurant $ 1,020,747 $ 944,136
Cracker Barrel - retail 321,184 306,292
------------- --------------
Cracker Barrel - total 1,341,931 1,250,428
Carmine Giardini's Gourmet Market(a) -- 12,590
Logan's Roadhouse 180,032 156,050
------------- --------------
Total net sales $ 1,521,963 $ 1,419,068
============= ==============
Operating weeks - company-owned stores
Cracker Barrel 17,277 16,888
Logan's Roadhouse 3,146 2,820
Average comparable store sales -
company-owned stores: (In thousands)
Cracker Barrel - restaurant $ 2,303.5 $ 2,178.4
Cracker Barrel - retail 724.2 706.9
----------- -------------
Cracker Barrel - total $ 3,027.7 $ 2,885.3
=========== =============
Logan's Roadhouse $ 2,232.3 $ 2,171.2
=========== =============
Capitalized interest $ 276 $ 731
=========== =============
(a) The Company exited the Carmine Giardini's Gourmet Market
business at the end of fiscal 2001.
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