Cracker Barrel Old Country Store's (CBRL) fiscal fourth-quarter earnings increased year on year, partly driven by tariff refunds, while the restaurant chain's chief financial officer said its traffic trends were improving.
Adjusted per-share earnings for the quarter ended July 31 rose to $0.99 from $0.74 a year earlier. The results included a net benefit of $9.1 million related to tariff refunds.
Earlier this year, the US Supreme Court ruled that the Trump administration lacked authority under the International Emergency Economic Powers Act to impose certain tariffs, paving the way for refunds to companies that had paid those duties.
Analysts in a FactSet survey expected adjusted EPS to decline to $0.17, if comparable.
Revenue for the quarter fell 2.2% to $849.3 million, but exceeded Wall Street's estimate of $834.6 million. Comparable store restaurant sales dropped 2.1%.
Full-year revenue fell 4.7% to $3.32 billion, but topped the $3.3 billion consensus and the company's guidance of $3.27 billion to $3.30 billion.
"The business continues to gain traction as reflected in the improvement in our underlying traffic trend, key guest metrics, and overall financial results," CFO Craig Pommells said during an earnings conference call, according to a FactSet transcript.
Shares of Cracker Barrel were up 4% in Wednesday trade. The stock has jumped 86% so far this year.
For fiscal 2027, the company expects revenue of $3.325 billion to $3.4 billion, while the Street is looking for $3.39 billion. The outlook assumes comparable growth of 3% to 5%, with no new store openings.
Adjusted earnings before interest, taxes, depreciation, and amortization are pegged at $180 million to $200 million. The metric fell to $147.7 million in fiscal 2026 from $224.3 million in the prior year.
On Monday, UBS Securities said investors were anticipating a fiscal 2027 adjusted EBITDA target of $160 million to $200 million.
"The company is already focused on the right areas and has a strong plan as demonstrated by the continued improvements in performance over the last several quarters," Chief Executive David Deno told analysts. "We are working to refine and further strengthen our plan, particularly as it relates to our focus on food and guests."
Deno joined Cracker Barrel as CEO in August.
In its note on Monday, UBS said US restaurant investors are cautious regarding industry headwinds and surging energy prices even as demand trends continue to be solid.
Darden Restaurants (DRI) is slated to announce its fiscal first-quarter results Thursday.
McDonald's (MCD) released its second-quarter results last month that showed revenue fell short of market expectations, as comparable sales growth in the US slowed on a yearly basis amid a challenging consumer backdrop. McDonald's disclosed new financial targets under its fresh strategy on Wednesday.
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