Revenue Performance - Total revenue for the second quarter of 2025 increased by 1.5% compared to the same period in the prior year, while revenue for the first six months increased by 2.0%[88] - Total revenue for the second quarter of 2025 was 949,439,anincreaseof1.1935,401 in the same period of 2024[1] - Comparable restaurant sales increased by 4.7% in the second quarter of 2025, driven by an average check increase of 7.4%[1][2] - Retail sales decreased by 2.8% in the first six months of 2025, primarily due to a decline in guest traffic[2][3] Cost and Expenses - Cost of goods sold as a percentage of total revenue decreased from 33.7% in Q2 2024 to 32.6% in Q2 2025[84] - Cost of Goods Sold (COGS) for restaurants decreased to 27.1% of restaurant revenue in the second quarter of 2025, down from 28.2% in the prior year[1][4] - Labor and other related expenses as a percentage of total revenue remained relatively stable, decreasing slightly from 34.5% in Q2 2024 to 34.4% in Q2 2025[84] - Labor and related expenses accounted for 34.4% of total revenue in the second quarter of 2025, a slight decrease from 34.5% in the same period of 2024[1][5] - General and administrative expenses increased to 6.5% of total revenue in the second quarter of 2025, up from 5.6% in the prior year, due to higher professional fees[1][6] Operating Performance - Operating income for the second quarter of 2025 was 3.1% of total revenue, compared to 3.3% in the same quarter of the previous year[84] - The effective tax rate for the second quarter of 2025 was 8.0%, compared to a benefit of (3.3)% in the same period of 2024[1][7] - The company recorded impairment charges of 2,163inthesecondquarterof2025duetothedeteriorationinoperatingperformanceatcertainlocations[1][8]−Interestexpenseforthesecondquarterof2025was4,978, remaining relatively constant compared to 5,067inthesameperiodof2024[1][9]StrategicInitiatives−Thecompanyplanstocomplete25−30storeremodelsandrefreshesin2025toenhancetheguestexperience[79]−Thestrategictransformationplanfocusesonfivepillars,includingrefiningthebrandandenhancingthemenutodriveprofitability[78]−Comparablestorerestaurantsalesmetricsareusedtoevaluatesalesgrowth,excludingnewstoreopeningsandsalesrelatedtoMSBC[82]−Theaveragecheckperguestismonitoredtoidentifytrendsinguestpreferencesandtheeffectivenessofmenuchanges[83]FinancialOutlook−Thecompanyanticipateschallengesinthemacroeconomicoutlook,includinginflationandhighconsumerdebtlevels,butremainsfocusedonlong−termgrowth[78]−Thecompanyexpectscommodityinflationtobeapproximately293,693, an increase of 51.3% compared to 61,879inthesameperiodof2024[113]−Capitalexpendituresforthefirstsixmonthsof2025were76,986, up 50.5% from 51,080intheprioryear,primarilyformaintenanceandremodelinitiatives[114]−Thecompanyexpectstoincreasecapitalexpenditurestoapproximately600,000 to 700,000from2025to2027,with160,000 to 180,000plannedfor2025[115]DebtandFinancing−AsofJanuary31,2025,thecompanyhad491,996 available for borrowing under the 2022 Revolving Credit Facility after outstanding borrowings of 174,000[117]−Thecompanyhasa700,000 revolving credit facility with an option to increase by 200,000,whichissubjecttofinancialcovenants[116]−Aone−percentagepointchangeinthe174,000 outstanding borrowings would impact pre-tax annualized interest costs by approximately 1,759[133]−Thecompanyissued300,000 of 0.625% Convertible Senior Notes, maturing on June 15, 2026[119] - The company remains in compliance with the financial covenants of the 2022 Revolving Credit Facility as of January 31, 2025[118] Store Operations - As of January 31, 2025, the company operated 657 Cracker Barrel stores and 69 Maple Street Biscuit Company locations, totaling 726 units[72][87] - Negative working capital was 173,982asofJanuary31,2025,slightlyimprovedfrom175,993 on August 2, 2024[124]
Cracker Barrel(CBRL)2025-03-06 17:03