CBRL - Earnings call transcript Q4 2022 | Cracker Barrel Old Country Store, Inc.

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Operator

Good morning, and welcome to the Cracker Barrel Fiscal 2022 Fourth Quarter Earnings Call. All participants will be in a listen-only mode. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Jessica Hazel. Please go ahead.

Jessica Hazel

you. Thank welcome webcast. fourth and conference fiscal Cracker and call to morning, quarter Barrel's XXXX Good we a morning, full This issued year quarter our results. and fourth press release announcing refer on In release fiscal year XXXX. the this to XX, and non-GAAP July call, fourth this quarter financial and we press ended for measures will from adjusted and our on sale leaseback transactions measures The the amortization gains non-GAAP are financial of the noncash related tax impacts. the exclude to the asset recognized and results these excluding with items that provides believes financial the performance. investors enhanced its financial Company of understanding The an from Company's not isolation prepared is income in substitute information or intended as net GAAP. with This to be in for information accordance or considered earnings share per a of include press release pages non-GAAP reconciliations last information this GAAP the The financials. from to the

this CEO, outlook. financials morning President will and and me Barrel's provide President Senior President Vice Sandy review with Sandy business, Senior Craig CMO, of Cracker and and Pommells; CFO, and Craig a and Vice are call the Tate. Cochran; Jen On the

in the information. that the statements, their and We the of from beyond and risks the caution described of or in events. may listeners and management's may we known furnished management press will of by considering operating then our and open Company's with regarding of be cautionary that, summarized materially made statements reports and detail the results are future cases, or risks description found We forward-looking call, and to These differ call file for On expectations. many in to the future release SEC. this Jen. at actual in as that Many are results for the could are and statements end which our results forward-looking uncertainties factors expectations Craig affect readers beliefs involve cause expected Sandy, questions uncertainties are up in and control

it, to Barrel's except shared law. turn Company no under Sandy required as today's of CEO, update applicable information call and obligation date, may is I'll Sandy? call Cracker on over undertakes President the and the to be Finally, this Cochran. now valid as the

Sandy Cochran

you, quarter. of our Thank per announced margin came was X.X% top good above share an X.X% in income everyone. and we morning despite This range predicted our Jessica, of that that earnings expectations of operating the inflation X.X% softer within that than and revenue, of end anticipated with total sales for at our the to we’ve were range morning,

fiscal good the softer end teams and the lead of about from impact normal perception on Our the worked pressure pricing a teams not hard if balance dynamics Puts the navigating of for persisted can visitation restaurant uncertainty the will more are industry now, the to on which, right even behavioral decisions of cost we long-term value than and against more properly recovery through desire did as when of with and year. abate. either our managed, these headwinds job higher and environment challenging shifts. navigating costs menu the the coupled potential quarter guest an Across that extremely third demand challenge confronting consumer management

the about particularly in right steady the points. June the we also and outlined is initiatives and optimistic focused and done at on focusing To Cracker preserve our which so model back do of extent maintained some perspective this the longer improve We've We entry additional details term of the well sections we’ve longer menu manage success remain ourselves, find turbulent share value a one, deliberately always I'll brand. Barrel business we've so our business we and in we in attractive we the to perform that While moment. environment whatever that while pricing, taken on our term in that to the environment. selectively

season, we very other of gas at others, what back inflationary of challenging related and acutely guests. we a weighed and summer continued cost model, from and perspective, high gas our heavily pressures summer business fourth that I year, fiscal many came expected. older Due these were to at the prices households most income travel on and unique XX through felt abstained the or inflation visits inflation from including broader the holiday our more and June food a end From lower some driving. high-end July slower-than-expected in environment in impact of discussed quarter, pressures fewer us elevated in June guests Looking particularly and the when curtailed to than prices especially

As will in believe much, maintain decided half this the pricing. to our the but not we our right this in to 'XX, impact of proposition fiscal especially the of inflation all believe on back we ease decision guests, cost recession. the value We potential of was with over a our strong pass face

during to we younger will fourth XX efforts and between guests XX traction the our and lower gained we saw in from and pleased we we visitation from XX over particularly increased and the millennials this between XX improve Although quarter of continue that visitation with and experienced guests, area, XX. were guests ages

increased also experienced income We guests lower from generally. visitation

to of We appeal efforts bearing 'XX, in investments of our continued guests trends during All to quarter fruit. well. the our quarter indicating positives our these have other into younger fiscal fourth are and as saw value first that

time remained a in with allowed the Our us inventory. supplying our annual our merchandise teams while disciplined work with their solid, top history, guests, which sourcing to approach our maintaining and our to sales $XXX in exceptional off-premise sales for stores and first retail in all resonated million that retail continue

Maple to bullish from supply we this kept and opening we in despite issues Street. growth number potential remain very had construction of on chain delays brand. the that remain us stores we open And 'XX, unexpected fiscal Finally, of in the the confident hoped

this. are initiatives current in As the reflect always, our the Cracker decisions longer the on we investment pursuing were environment of Barrel focused success and term

Craig are guest innovation sure to menu our technology competitive in We are and experience, critical enhance consistent investing to investing in ensure maintain to advantages allocation. able 'XX, in thoughtful year. to Through greater pressures what's to check our were base, in quarter additional inflationary compelling the returning able well-positioned share our some shareholders shareholders We finished, guest in $XXX about into provide and broader for to And fiscal Craig a in still we a our to XX prudent record repurchase a to second while provide some our operations about appeal testament so we our we and the highest industry make capital strong and is when were levels return an our approach is to the investing and eventually I'll our quarterly near Craig? ahead. of dividend go once a now to these million optimism and years. expectations ease. initiatives over details investments detail the will our upcoming that level program, making last about capital

Craig Pommells

you, everyone. Sandy, Thank morning, good and

the reported quarter's fourth year decor, and Home forward their roughly in Comparable team prior The both during growth price of the Comparable actions X% restaurant sales X.X%. to forward of prior a over and retention year. carry want sales X% fourth revenue hard X.X% were Restaurant from X% apparel quarter. $XXX.X quarter, experienced pricing quarter. work all is carry For and million. retail retail pandemic. grew increased we off-premise primarily from the increases third [ph] including and the in X% expectation the pricing the long-term of store the sales increase Like our thank to roughly million grew with sales, compared driven sales largest X% this by consisted store year fourth total million, restaurant Off-premise first in of the X.X% by increased revenue $XXX.X XX% year. fourth our by which delivered retail category. toys pricing. Sandy, quarter line of we I prior versus store X.X% total sales, increased quarter offerings by for men's to restaurant $XXX.X the Comparable revenue to

of fourth sold in revenue quarter our expenses. cost cost the of total to on the quarter goods Restaurant year XX.X% goods versus prior quarter in Moving of the was quarter. fourth in sold XX.X% Total basis year as XXX as primarily partially of inflation XX% well offset the XX.X% commodity XX.X% was of was driven by This versus costs, by freight prior restaurant in elevated sales increase point pricing. quarter.

inflation primary grains While minute the the we inflation basket, XX% worth commodity drivers impacting increases experienced fiscal faced pricing such It the is broader high bottom dynamic. the on were XX% a with 'XX inflation year at inflation, entire and and poultry at of Having inflation a market our across spending at historically XX% line. inflation. oils

believe future that that labor costs believe ease not we ease. do costs we substantially, commodity will do food in While the will

to we the face in less made such, recession this offset the take inflation. than a As especially have moderately price to decision, we of potential might

points. quarter, when net XX.X% XXX inflation prior related point terrific pricing and year Fourth a guests mentioned, higher is we an driven Sandy was an balanced freight our labor short-term driven sales This in of of by have prior retail we a year and and by XX versus were was as This basis As promotional increase quarter when XX.X% well. and of year sold increase the versus unfavorable represents long-term understaffed. increased XX.X% wage at levels retailers maintaining versus and many for seek believe primarily consistent the of XX.X% in activity time lower proposition expenses this or cost was from revenue of not of prior important basis affinity. primarily performed manager quarter resulting staffing and the hourly retail modestly our the Fourth team brand goods impact to retail productivity in were value increase quarter. performance costs by

spend were was expenses repairs maintenance year due as replacement supply This well double-digit expense XX.X% driven Finally, equipment adjusted point XX as to property other primarily shortages the revenue prior on quarter. as basis items more increase inflation. utilities operating of we and of versus by for and XX.X% in increased

due the results operating adjusted income of quarter XX versus year in due X.X% incentive to of level in store operating noncash primarily our were general million. revenue basis sale transactions, decrease amortization This the leaseback recognized point prior beyond fourth in of compensation. the asset administrative of Adjusted the and GAAP and sale was $XX.X the X.X% These Moving million lower expenses $X.X lower fiscal convertible is fourth on culminated the from the margins, rate the gains the of quarter. for $XX.X decrease lower a was prior of Net levels XXXX. quarter the revenue. debt This $X.X X.X% to quarter adjusted quarter for net in for interest was debt million result $X.X average million million interest compared the interest completed expense to offering as we weighted the year or of as quarter. of income well the in expense

X.X%. diluted negative $X.XX the state lower to was adjusted effective quarter per diluted was earlier-than-expected primarily of GAAP our settlement expectation, expense Compared quarter, Fourth driven the quarter EBITDA share and Our matter. earnings were million. for per tax share by $X.XX. rate tax the were In fourth $XX.X the fourth tax earnings a was income

a our to Turning capital balance to We balanced capital sheet. committed approach to remain allocation and allocation.

the Maple priority remains first Barrel Our in growth Street. and of Cracker invested

that, the while In fiscal sheet. Beyond we to flexibility maintaining our we million XXXX. balance $XX.X appropriate shareholders, to and for to total return million our capital full invested plan fourth expenditures, capital year bringing quarter, in a $XX.X conservative

million combination total to through repurchases, million. $XXX to our more quarter than a dividends $XX.X year-to-date the and shareholders bringing returned we fourth in share Additionally, of

debt-to-EBITDA total in million described to today's release be outlook, Everyone net should debt, this X.Xx additional Lastly, the provide and our uncertainties to our fiscal risks mid-term, like XXXX filed reports In guidance quarter maintain ratio with SEC. to representing respect the the the in ratio. morning's net some a in near-term debt-to-EBITDA and we ended in earnings a range. mindful to outlook X.Xx the provided to as X.Xx expect associated color with With and $XXX.X we I'd the in this of release. with

over growth X% X%. revenue be to prior fiscal range the total expect the in of We year to

drivers XX and locations. locations sales total In to Street group approximately assumes total to of continue Comparable approach believe anticipated sales guest we the opening price growth, commodity of of addition The value commodity leveraging the will our of reaction by anticipate XX the protect approximately are our comparable of X three our X% store for and anticipate test-and-learn a approximately basket, pricing. approximately opening is in expected respectively. deflation. new representing inflation alone Maple largest to versus to slight will expected new mid-teens methodology year. of QX. strong a QX, account for dairy our to to be driven poultry, We primarily annual proposition. monitor and Cracker this fiscal X We the inflation store growth expected control end with Barrel commodity market each We inflation And to of anticipate to in by favorable the produce commodity remain continue be categories X% and this are XX% These category impact. carefully and X% by prudent overall approach thoughtful to XX%, inflation XX% in

X% inflation begin the QX in to highest through for will approximately inflation quarters. second year rate wage until prior year fourth with being expect wage which We jump we the for the lap inflation result quarter the in rates, a lower fiscal

several the opportunities during last we've initiatives in to an to business $XX year to annualized cost the and expect deliver quarters and the approximately rate million work year, of from We support with company cost run in million over savings identify savings done fiscal the between improvements. the ending $XX systematically million $XX develop

our combined like XX% leveraged system. initiatives were are likely fiscal to savings food, favorable savings that would food and year. throughout deliver million, system introduced test $XX initiatives the through store expenses. have of roughly annualized and of for impact improving with year, hourly labor just other much remaining like realized later new to all stores in larger Other These labor new with retention be anticipate initiatives, new We that operating restaurant sourcing costs and still capital company-wide which management now $XXX P&L. more of with recruitment the toward including and including year and We meaningful and a the familiar related employee equipment for training approximately can expected Some changes savings but the reducing of XX% productivity, will robust expenditures being we've savings cost COGS will and anticipate are returning to the provide the in which new pre-COVID the system in levels, actions, each the other deliver are last million. more further a investments specification supplies half spoken under be

between income year. XX% fiscal the We expect over operating grow to X% prior and by

inflation spoke commodity wage and contemplates In just revenue addition the considering growth savings growth, operating this following to assumptions. expectation the and cost to, guidance income I

compared quarter normalization. and high our just and the operating be prior utilities; and operating in pressures moderation prior we below each fourth operating cost we notably areas most near first of XXXX we income inflationary the in moderates Continued inflation retail our other and well quarter margin just income believe will traction. initiatives with be XXXX fiscal year the And the anticipate P&L historic the a meaningfully supplies ended. income to compensation quarter gain prior We to the quarter anticipate incentive performance improve below fourth year quarter commodity year savings result, as reported. above as We to versus quarter first

expectation If be our further in there our there if income is a or P&L the in increases there the upside further. may were over We environment, XXXX. turn even additional of operating so potential worsening to commodity operating environment Sandy, moderation share I and to will moderate around the inflation income downside for business expectation. in call believe consumer our plans details also were fiscal the potential if fails across or she back to

Sandy Cochran

Craig. Thanks,

bigger see the the significantly they to eventually over half believe A whether as levels of the compressed get expect the will the answer we we yes, first in year, commodity is towards is but time. of in you, manner subsides for outlined profitability, expand we question half just Craig As pre-pandemic margins inflation back in back expect. will

this our paying gap value to our compared elevated traffic, value raise costs and position on so and to commodity increases of value to the the actions is published leadership on and metric scores pleased taken face even our referenced of that that speaking far. in sustainable period, concepts help our According high today. continue price that term focus to the reduce will line mentioned off appropriate take competitors I've selectively that investment is maintain excellent in nearly drive I'm remain and savings shorter-term most top including focus report the for relative initiatives taking the investment already and competitors. in year versus our Data, inflation, every increased Technomic prices to wage other Of Craig similar want course, pricing versus relative to manner our we're on cost recently we affordability. the prior to we we've and to to an are offset levels where longer but

way perception to value continue in approach a will pricing will our that high. We scores keep

While levels, and visitations to seek our guests investments over we from visitations culinary technology. marketing, in innovation younger increased will from guests pre-pandemic we restore to targeted to age try XX through continue

time Although by XX to to is over over-indexed it guests visitation balanced, are and an to are move appeal things will from are to the younger one doing that take more position of we families believe we that guests working. who

well breakfast has been Our innovation menu received.

Our new beer progressing and wine and are well. culinary is offerings resonating

well continue these their expectations meet making and in guests as will experience. as We of investments technology our further efforts to younger the enhance

them focus further in excellence, of for in talk our hospitality year, let's employee important our areas and to will long-term our success. about invest operational and some fiscal 'XX. to other Now the brand we be our of This stores, exceptionally believing experience

to the to 'XX and development will across our continued Our the staffing and the catering a growth efforts menu in across strong, menu Phase is continues Culinary house our focus to we others with We've of Culinary system. increased core and be reduce key our execution support fiscal with of innovation been continue plans peak breakfast to our levels launch. pipeline robust designed remain in pleased training business. and our consistency new our of menu existing and menu complexity and back refresh X dinner of some weekend many gaps offerings menu periods. during of fill introduction successful during items

We offerings million. believe these will to to can desirable a Cracker business-to-business category, both XX% more offering and be growth and provide to business-to-consumer pulling this through throughout families unique to new 'XX real companies top Barrel in $XXX grow events. by to which highly of We we we our catering many and business, as see their fiscal opportunity look

loyalty Tate strong on our engagement, with Finally, Jen program, we our guest as particularly last will and be out guest our rolling impactful be quarter, retail developing brand for restaurant which, focused highly and travel offerings. should and explained

the to an We believe are right we launch and time by running and it. Maple taking the launch other is anticipate new President, well Maguire, to year. building program Street, to be get and initial of appropriate the compelling developed the growth. integration support John The respect before the to has it as critical, needs we are requirements back-end hit ground we With our end and an team

'XX extraneous we’ve delays, and about before, the we and we units had opened concept new said remain expectations. construction with open Maple factors many units the expected, we I've didn't are as due although excited in Street As in to as line fiscal performing

units and And questions. up in and open for We further before fiscal 'XX, 'XX. 'XX expect with that, to XX open I'll fiscal XX in to accelerating it

Operator

here from Brian [Operator will first ahead. Instructions] And Deutsche Mullan with our Please Bank. go come question

Brian Mullan

to all. the with guess, now. if going any behind this could all what guest that where if remarks, to prepared older which way if factor COVID. the right guests the -- be to better gas improvement, hear. final was the that curious improvement few just mindset you is trends the decline I I'm just describe been Hey, was in And of really of my But and in the was logical guess. prices you speak thank if the hear. sales late you maybe is not on weeks encouraging But release you situation, back like think wondering a the That to with I guess, quarter, just in could you. anything it to traffic behavior it could sounds there's prior The helpful at there's would mentioned demographic I’m of from is on

Craig Pommells

the Brian. to Hey, will The it us Craig. Thanks. will I -- over and a turn morning. there. of I second in What's the for quarter does part is improvement to I -- second acceleration what will the it Jen. then mean Good it what two-parter or turn driving there's quarter. And first and the start mean the half. it This does the I in guess off over

quarter, as in going year first impacted the right, the you we to to so much they think were we the relates comps than particular, think say -- disclose as how to it other that about are about example, as ago, there you for us comps, a -- we'll So and by was how impact Delta. not August,

how impact an versus month-to-month we a other that. a are on are consider has going that lot basis, there to to base On factors So comp there. of

a on activities, extraneous Ukraine of so lapping and are lot things we I gas mentioned, of So such invasion as as such on. things Delta, prices as and

it still So overall, with progress, but we think pleased I be. the won't are

So can that, Jen context. some over will turn I to more with add it

Jennifer Tate

Yes.

I performed as see a your that to question whole. of week, consumer, as but still don't quarter first can by the sort them us about all, data for visits. the have holding I how of speak for that group We to XX-plus think regards we back

category true our we still They the true lower important I of and ago. are it's a have where boomers brand, visits a for number a group. a certainly and and as matures think for seeing year they represent their really that's whole, large than disproportionately

XX in millennial is year On their remarks, have levels. to quite we those enough olds, the headwinds negative the Gen visits ago to particular, guests, said the Xers, our but younger millennial than from increased in guests, prepared flip to returned our side, her XX-plus higher not visit year of XX pre-COVID not frequency as that also guests see were offset the to the the pleased although Sandy fact

Brian Mullan

including you retail guidance, follow-up business, just important of expectation you level you would thought mentioned factors prepared helpful. magnitude as you for if to put your the could question to an wondering I current XXXX consider and or Okay. And the elaborate if moderation that. speak about I'm then that, on Thank on together how think gross could the some to the speak be just of margins what of you retail remarks, in a but are just that inventory. the you Craig,

Sandy Cochran

start will and off I it elaborate.

So first of promotional margins, I team able all, what pleased was in to a the consumer environment. face the in fourth really on of the very with challenged retail deliver quarter was the very retail and a

we that think we're being is I to products what that quality have the of With we value more there. though, into run and some speaks as a to the we out normal said, that which are return go cadence, anticipating side. markdown 'XX as do the as we work on we through seeing is some the manage and of businesses the abatement through. product just exit always theme our we year What kind will freight

risk a little markdown costs helping offset container that's in down, be of to year. we see bit coming that our and So that this appear elevating

even we first of we those would hitting would ended that in the in have of in and second quarter. quarter or quarter them year last inventory fourth was than or that the of receive shipments higher them instead level, holiday single had in sure we so prior up the we terms our piece the that that of 'XX of majority In biggest merchandise of at year, the our accelerated which be time saw some was the the end the

Brian Mullan

Thank you.

Operator

Capital. Stump Our with go next from come Loop ahead. will Please question Alton

Alton Stump

question. taking for Thanks my Great.

-- but the year is of much 'XX? I if to be as did you this, what on over exposure you commodity color how can like variability 'XX, missed full just course And us front any give could your the the sorry fiscal spot for covered say for that

Craig Pommells

off will Hi, start with that one. Alton. I

we through point. we are way high. And very, for 'XX, fiscal ratio that's So if -- about our very for calendar working 'XX you coverage are at December, think this is very 'XX, XX% about so it's is low. covered calendar And the

lock are spot right and couple One we to market, going in And exactly a because are we so what's when working for how are is 'XX, for a we factoring but is, to happening premium much now the here's that. there lock of through in things.

we conversations right are now. So having those are that

now XX% calendar right heavily to So 'XX. locked weighted and

Alton Stump

imply be Got you then a to in it. hop back that I you Obviously, heard I expect quick as year. from additional increase what and the pricing the go taken what of timing course and And over through through you being flow months. think just But up full the you that of taken follow-up, queue. your for would over have you've X% this Thanks will menu XX XXXX? year when that to the just that But mentioned, last color. I Craig, prices expect

Craig Pommells

X% I super on think that total. to point, -- and this we is -- Yes, just so are I'm so as don't make sure clear

quarter, anything So anything that includes dramatic. by some movement new comping and that we but are nothing on. And there is

than there. really much So won't further drill I down

Alton Stump

got much. you so it. Thank Okay,

Operator

Please come question next will Jeff Gordon go with from Our Farmer Haskett. ahead.

Jeff Farmer

A of Thanks. follow-up. guidance handful Great.

for, or the provided for for income does guys that revenue growth looking guidance what you operating the 'XX. mean for income But for So operating what margin suggest year? an growth and you're

Craig Pommells

-- I would and candidly, that XX%. the to to really would I growth, OI the what that And I would I think the just that X% revenue extrapolate will get when take you will X%. of with I from one. just you X% combine you Jeff, need

Jeff Farmer

Okay.

move from that will I on one. Okay.

you guided percent X% guidance, X% to the that menu revenue with pricing. revenue single-digit small the growth. There's contribution growth sticking unit to some X% then to So growth,

would average don't have I that question we the and be for components you the and traffic then check. So have

So growth. that unit in What menu and and X% average the for single-digit guidance check I'm expectation terms curious Or again, what's does pricing traffic what for Knowing, your equates that? X% both just for of to implied to X% in growth. revenue low mean?

Sandy Cochran

is line And Jeff, another will another retail. let take component, in that's we've got the our question, I but which calculation. Craig

Jeff Farmer

Okay.

Craig Pommells

there down bit from a little will so building Sandy's point. Yes, we on drill

growth So Street Maple the between unit Cracker Barrel XXX points. and basis is about

and there So is is I'm the clear super corporate to of make revenue And on basis unit out total X% side. to about the in points side that me not Street this, growth And just that's again, what the Barrel. Maple growth. impact out going that, let the between figure business, -- And and of retail can contributes. X% lay X% the sure embedded XXX restaurant obviously, we Cracker to

So through. it doesn't flow

as from X% be don’t get range. of to basis what an number. -- to an of these we provided -- comp Omicron, were be that there expect we traffic, on will gas range to would and well. that I we are in anticipate the retail a with impacted XXX and get to to as be we contemplating that And we be $X from some contribution -- example, that traffic we for contributor that the think don't terms point closer that pleased something What things exact our in You or Then business, continue X% positive comp will a unusual items, comparison. business range, the we there prices is that $X those I would are say in

Jeff Farmer

Okay. helpful. final I one me. for [indiscernible]. That's And apologize being for

provide work And quarter-to-date, that establishing to it sales this in us I might XXXX. detail the believe with the of might have too ago thinking which missed going of off terms giving you time, about But the year. metrics terms year of we be in did same-store not for much was were you So it I guys baseline sounds at or of like was it. versus a helpful with balance

again, and sales apologize versus quarter-to-date XXXX quarter. into better weeks terms quarter you in or either ago helping retail AWS the stand, is AWS X if are of share terms now. same-store missed year are I we guys a anything us both through the it, where right understand I in You Again, restaurant of either can there weeks but where X or numbers or

Craig Pommells

Jeff. question, Good

We texture will the more to a bit little try disclosing add without quarter-to-date.

I example, fiscal do what line Delta be guidance. our first with couple quarter-to-date be there wrapping things a for we that of year. would a last in year our So again Cracker particularly things for is and can relatively say we about of these talked little unusual impactful we Barrel, away sales the are to all But anticipate tricky that it's quarter from is because on

Jeff Farmer

one mean is you when number? sales, the say sales last same-store So revenue you or

Craig Pommells

revenue. The total revenue number,

Jeff Farmer

that. Okay. you. All Appreciate Thank right.

Operator

Please Griffin Katherine Our next from go come question of with ahead. Bank will America.

Katherine Griffin

for Thank of guess, some that with about targeted return is reflective understand saw question. that you younger customer base, the some my that wondering I of, marketing. trends the I of was on Hi. I you some taking just

do do of there right we I between are also just there's base perhaps which that sticky how get next I'm some perhaps contemplate summer can now wonder travel, you're aren't travel? that curious seeing differences, just and think And customers, customer you any less then year, traveling? if that how what you if summer be going expect normalization I forward? compare to

Sandy Cochran

some we’ve mobile things we important been And it's pay that and said, as Jen Thanks, have in And let speak our seeing speak Jen were will get delivering number to that we which the a on, group. you beer it the specific. appeal an whether just that our that a think had initiatives it's Katherine. Certainly, I I will we pleased we to more as we Jen of innovation first, that initiatives. result increase both thought like the But I'll marketing, really and particular, specifics. that working in an are let indicated But were of marketing, already as of think we were would and of targeting mentioned, to we we particularly the our that, technology that we've in to well the check group general, to interest. data then particularly a number are content of wine guest. that of group. think that as efforts some menu things, and way see driving

or you sticky So, you want how hope to to it is? believe it is speak Jen, do

Jennifer Tate

Yes. Katherine. Hi,

will think I be believe sticky. it we

fact, steady In we progress. think this represents

We also saw some increases third in quarter. the

so these third progress to fact, environment. food, And And and XX the we XX especially fourth year in the is multigenerational actually seeing high this building for the time. among value had some olds. good rate of terms we guest increases quarter. base upon in quarter some increased were in We now really are frequency, just What have

a of lot folks where families. to are that life their think starting these I in of have they're stage

what very so appealing Barrel Cracker for is And them. represents

were did said, families, strawberry course, quarter news, of we our a Sandy are behind build and innovation, breakfast, we to targeted in particularly Cheesecake the as then, of come lot focus own your digital menu the younger for we put Pancakes, fourth this continue a fruition. breakfast on that launched items Our that intended sharp these And our group. seeing to

of with So group. this we part continued frequency our against is this growing progress believe

Sandy Cochran

one just the retail we were in which young was biggest of were we quarter of reflection Katherine, visitation getting as Craig think categories our the these mentioned, the toys, also I will side. X add thing, fourth families. from One, a on more

Katherine Griffin

that because I in? you from customer of No, I demographic was, the yes, you sense that they're -- higher like Yes. that. you am guess, as so store of, then more wanted of color it ask And are appreciate got shop to I shop X:X likely the guess, ask customers are retail if that how, of sounds business retail right did one I at after store? to the terms have it's to the well. I in base, dine supporting Okay. is types that I making in pretty -- actually question follow-ups in I the visitation the -- I to But a millennial versus assumption likely mean, is of much one have that terms that

Sandy Cochran

lot were is No sort was impressive everyone. The appeal. to one a assortment Craig that is how me most store, strength they'll think that areas guests use that for incredibly our there's varied I somewhere they which saw sure we home behind decor, pointed our of hard left retail the team has let of something in sure work things be that Well, say about the assortment. broad is what seasonal of our out, be really the that to sometimes

assortment, our team increase then that most I trying the amazing example, which it vests in product, men's be I third, a appeal. already focus. camp but And it Halloween area incredibly for we relatively [indiscernible] industry new licensed think our was mentioned. men's for apparel, and was sure and was So think, some had costumes, some than like things a assortment broad It's toy And I've that's our which popular bigger the retail to has items of reflects the guest. some that shirts and a dollar, something very but probably of successful, of percent

attractive generally, We just and think So I on we of for were had had on were We price lot we a points, everyone. variety brand. trend.

Craig Pommells

is lot Yes. there -- more in ways, you different is what but in think this you a use are restaurant maybe of see I cases. anecdotal, Katherine,

And got For they see example, well. kids Grandma breakfast something way and as have up right? and for and dad, they're shopping and breakfast or something pick their treat and mom the they a you Sunday you and they their they out out, go then you've get get Saturday then on Grandpa,

business good does I with think and the is what's assortment the interesting how with the the a of retail cohorts. team different with appealing to covering bases job

Katherine Griffin

that you. Okay. Thank the back get you. in I can third queue for question. Thank

Operator

next Our go Please Jake with Securities. Truist from come Bartlett question will ahead.

Jake Bartlett

be comment guidance to you on think just wanted year. the quarter Great. start same as expect growth you the the Thanks questions. to first for I for And the made back Craig, full a that sales I [Indiscernible] taking the just XXXX.

to expect to the -- similar I that. So to X%, the make X% do you do year? sure want mean first understood to grow revenue quarter Just you full

Craig Pommells

line. in it's Jake,

the X% to line we QX guidance. what to with very annual terms, is total would growth, say expect rough total X% in So sales company be that I in we think

Jake Bartlett

and great. that us -- just And then and in Okay, chimed of you a retail Great. component is Sandy, remind of kind this to mentioned you growth.

faster driver a up expecting on strong X% growing of you X%, result just than meaning are growth in would X.X%. you're than Obviously, of a really was year-over-year XXXX. the growing to then kind up, And what, it retail positive in quarter, to it be that grow to of faster that. fourth So be a

the retail essentially basically, X% help greater is, be be question growth going So drive that X% is than to to that?

Craig Pommells

Yes.

has I retail strong performer be a will contributor. been XXXX. since you think very But noted, business as the a retail

will going that expect will But that grow it component, contribute not So a total. It will above not be be are X% contributor. a X%. but we we it do it a the -- expecting as to X%, expect it's above do to is total and we to -- that

Jake Bartlett

guess sales expect to I X%? do X% faster than otherwise, restaurant to grow said you

Craig Pommells

land in the I I guess, with I one. mean, say would general range. in think, is -- Restaurant that that where are we I line, would sales,

contributor of sales. biggest that's price one-to-one We of kind on going have the X and be to restaurant the

Jake Bartlett

value is in Great. the to about consumers, the of proposition that careful rolling had your costs pricing anticipating Sandy, about comments that and for commentary expectation of on off, being commodity I X% start kind the And off. would that X% the -- pricing. then I to going it maintain you menu rolling expect be I'm I to But think your a for for question kind be given wanting whole was was especially year. what hearing

adding would imply -- going over the you're then to price through year, as be the fiscal price that So whole I next off in. rolls that think

So Craig, each for I think X% quarter. should your comment roughly was that expect of kind we

right. how guess want right maintaining that the is make to that comfortable I And would So true, value. I got that, how comfortable that I just sure if be

that store expensive grocery seeing of up assuming going think to more pretty [indiscernible] come will restaurants if narrative grocery coming than down. I we're likely commodities be sharply, probably being

expect right total So one, am it X% you incremental then year I right, I comfortable you about mean, then throughout that the And pricing how our pricing? that? and is with are

Craig Pommells

start, will I build can Jake, and on Sandy and as it will So well. jump then Jen in

the of leave in -- line, year. growth it got QX, total of we've X% X% again, guidance part for we've it's kind it the said of generally there. In will of So leave and it the revenue to kind

business value. as and that, inflation about that's maintaining the price of and on right? we we very I cost 'XX, take we've and terms think over the overall rough saves year, few excess it last a pricing relates if price, inflation you through is cumulative So XX% and the XXXX -- in about years. here over model well as other get to our And factor had that then to the our XX had really we've delivery ensure a think great

at room level. is and there think we we there are lens, that with think I that comfortable

So Sandy more. to turn she add can over will little it a I and bit

Sandy Cochran

modest is group, thoughtfulness have increases increases a big two monitor. try moved impact mix from reiterate always frequency. frequent Yes. our guess that and [indiscernible] to the smaller year on two strategy. pricing that We will I that's to assess We’ve menu the holdout so goes what a year, into I increases more away we a really we having

think after And menu. I we careful the in can team so of And that very price all value to throughout about the even on it. Jen day menu thoughtful being the increase, are and are ensure sort parts, very guests being her that find

year, one guest the increases five We see about either and the will for each price doing there's through, I four, guess adjust to reaction monitor commodity or significantly the the but changing will we planned we be as changing. the environment

Jennifer Tate

is would just right, largest that the add pricing August of already was which our I the thing, which action, one be we've taken likely Yes, year. to

sprinkler, holdout we our guest relation. our We our we carefully satisfaction that Now group, across monitor guest will monitor surveys. check

hold have the five risk those not risk. off. traffic then option And to Should four take down some So half are sources or every trade or that of back we pull different increases. those to see you mentioned trends we week can we any your there's that in see if price we always monitoring we question,

Jake Bartlett

so much. you Thank helpful. very That’s Great.

Operator

Our with Citi. Please Tower next comes question ahead. from go Jon

Jon Tower

Thanks Thanks. the for questions. Right. taking

if may. few, Just I a

you the was the what of incentive of for just G&A On kind comp factored and 'XX? guidance remind that's how outlook, reset the us can into fiscal

Craig Pommells

typical think say what would at that you Barrel sense is for too and good has specific a QX, I Jon, kind What at I one G&A I then give again, would of been a do pretty Cracker and that's number getting Hi, without of normalization. what could -- look look there.

Jon Tower

Okay.

$XX $XX the million. essentially, that Is It's in that that that. the the call to no embedded on savings number is coming or to I that savings? alluded restaurant think gross of level million you earlier cost net So a a most at

Craig Pommells

Can we are gross to make you sure elaborate at on the versus defining net, a little same? bit just

Jon Tower

in basic on any cost be would that think offsetting there the you Yes. might some the of offsets savings or outright side a Are that inflationary environment? noninflationary

Craig Pommells

on There so save right, an doing are initiatives. we are we have basis, ongoing cost --

are then supporting one that the program investments the of loyalty making and and company, so of the the bigger we a have on. same We technology in a lot have time we to support growth at things now,

smaller big think I and I I in in would we've pieces OI we've picture called the that take are out, there, So investments that between that on necessarily components other if there are are you overall focus that given there but of the the haven't provided. we there kind think guidance growth, components

Jon Tower

on some may the then consumer the kind are customer regarding than, color the higher And they're or the differently some cohort. getting older with frankly, these menu visitation older like of following But seeing, you've average responding different usage? And up demographic? to this checks the group say, just and on millennial from? It attach new be you are alcohol And to greater with customers seeing part of you're day sounds the and you questions promotions you how menu base? you just versus added. some the that using items say, the could these provide Okay. earlier curious I'm increased if customer base customers sourcing where think

Jennifer Tate

will one I to Jen. Yes. take that start. It's

test, the that they to our our families these we home brought with see a get only menu want they own build tend launch we section. younger that like and breakfast think way breakfast on see and We breakfast expectations the to just I enjoying above XX. are whole breakfast mixing introduced it. June that but new that the being we not younger your guests above customization, And style them able

see so with And that mixing into them high we a percentage.

see tough we've NAV news categories, also to are brought them and wine the also of loving in and beer the We environment. to which spite category our economic

new and call the of of expectations. our what what new call cheese with tend retention strong snackable incidence quarter, is items in we of launched groups our I these curtain. really fried bites, which such we above to finally, ones sort seeing shareable are menu might a barrel the lot as a first items are think pickles, we which that high our which to put performing testament you then We have are a on those incidents, And beverage overall

to our seem beer enjoy then they So disproportionately bites. wine and barrel our also and

contributing second of a Is check. -- And part question? our favorably your so to that's there was it

Jon Tower

other locations? to see Do they're promotion going are these you limited from from? to Yes. restaurants digital responding your with away Are something happen service pulling over hitting they wouldn't you or you're and home customers even or normally, Or getting perhaps some you're in channels? where full sourcing out a know advertising who from of and food people be service they

Jennifer Tate

you millennial frequency I we say general, share But they're base. information I don't would guest to if think in I are will. that have our seeing where not going, increased about among

Jon Tower

mentioned, in then follow-up development were for year Got the Street. call 'XX. this the particular, side. And I faster some a versus had in a And of Maple it. that believe, you chain delayed it's on obviously, Obviously, development a kind of there openings just Sandy, supply issues particularly 'XX,

equipment wondering the to was on guidance provide to improve gotten that was year, I or than source you ability you're some better delays the seeing has months if maybe permitting last So relative color attainable is ago? for it what could to even 'XX just more signs what seeing X suggest you're

Sandy Cochran

get chain estate. the a the on we lot impacted about the was Supply for whole opened that's needed clarity another to equipment construction piece, getting get [indiscernible]. couldn't real done The also the of we've it was it. real as of But We just numbers variety was open. of to supply just all the chain think reasons. I I guess, case. labor Well, pandemic a

both in So it's for each Barrel. and Cracker for of I areas, improved think those Street Maple

announced. in the what new we've to just six, to modestly more in well opening think, we higher about able I to hoped than had 'XX three we're we see -- Cracker fiscal the am Street unit as higher than schedule what of do, done Maple So we'll more as this fiscal is Barrel the was ability year new the I quarter, think fourth optimistic ended I and hitting how growth, in I only unit growth side for ones the get their get

Jon Tower

the taking questions. for you Thank

Operator

will come question ahead. with Company. the Benchmark Todd next Our from Please Brooks go

Todd Brooks

Hey, The fiscal one Craig, given come in maybe thanks in. for for follow-ups fairly operating is where squeezing 'XX. have me to quick of specific I expected couple here. you've that, a can guidance for just component to if income of up of in to G&A Where we guidance in million boil year operating for that do come maybe to $XXX expect of to it thought. you just kind a million relative year? income full $XXX full the

Craig Pommells

to I provide think the we compensation there getting, have some with exact at adjustments. of G&A, incentive And direction. making kind well QX guidance getting Street is of look in that specific and too recognizing what history some -- to that had without beyond do and some investments things technology the as that are of and nature. without an Maple we number But again, trying

Todd Brooks

may the of landing that apples-to-apples But you down this we for much elevation then in to come by inventory July? up secondly, be coming up some unit Can to Okay, year-over-year the the the Sandy, boil inventories of more to October, levels, retail? earlier inventory maybe retail out getting a great. end end as seen you you kind And they're the to then that wouldn't units? of what year-over-year. How expect QX at fact would for of back was have to products Thanks. we pointed year-over-year related holiday the out of

Sandy Cochran

but XX% increase versus give is exactly to a can't say let it way, me say, prior little more in Let's that increase. about inventory The try probably you of answer I I'd color. year, price

inventory million holiday of embedded across what's And chocolate maybe probably the of have just price it, doing is is invested now would our then, we well. it board right the our very or everyday in Again, from like about the our is component really then so business, supporting another seen XX% which big that growth, that's food. be So good increases. acceleration. And $XX candy

that we've product, Some that of lot supply inventoried chain with into due were get a been to that. able we to the before of stock under that

probably the increase. are biggest three those the of components So

Todd Brooks

great. Okay,

So up just discomfort talking side half up full levels relative given just first inventories versus about price potential picking historically maybe last picking inventory environment. when year, the kind on the the the of with of strong year markdowns we're performance retail it's the selling to the and and

Sandy Cochran

clarify. me Yes. Thanks letting for

into we but markdown And every what lower So rate higher is lower are is we a monitoring teams the understand very day. meaningfully last as which being course, year, something the change. we and with in a season is retail Christmas than particularly that anticipating the can than big the pre-pandemic We so had pre-pandemic. particular. though, than And environment are season, for important that, consumer

We are monitoring to it, environment, as the and retail operate understand are we backdrop. macro gets monitoring we we have more and it more promotional, with then that

we our through retail have selling So is a that season are going expectation to the strong holiday.

strong, mentioned, I way. am optimistic Halloween as that business, Christmas system and will that be also in seasonal I our Our very were seasonal performance Harvest and

Todd Brooks

Thank you both. Okay, great.

Operator

Please Our Katherine America. next Bank is question go a follow-up of with Griffin from ahead.

Katherine Griffin

Hi, thank you.

drill about one frequency Jon -- on like to just can continue But weekday versus of I younger the guess, you well is, I a you mean, there just of also again, I I'm but customer Do that as us sense weekend. are types in this. base, the daypart, wanted Sorry in differences? down give asked cohort? to about curious differences, thing the into

Craig Pommells

detailed from daypart. major days which that meaningfully our They're pretty study coming have from the of terms see guests. difference thorough different don't I they're would we completed any months the learnings not and say week markedly on other segmentation We or we about in X ago. of our based or

Katherine Griffin

Okay, in. great. Thanks for squeezing me

Operator

like I for would our conference to Cochran session. turn conclude remarks. over closing now Sandy question-and-answer the will any This to back

Craig Pommells

on Well, performance our broader our drive fiscal we 'XX this to experience critical savings beyond. well-positioned and last to between guest investments and thank look sustainable priorities like areas everyone. and I are from I appeal. building our forward believe and year guest year value, strong in on cost executing you, efforts

Operator

The you presentation. attending today's for conference has now Thank concluded.

You disconnect your may now lines.

Cracker Barrel Old Country Store (CBRL) 27 Sep 222022 Q4 Earnings call transcript