UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 2.02. Results of Operations and Financial Condition.
On November 30, 2023, Cracker Barrel Old Country Store, Inc. (the “Company”) issued a press release (the “Press Release”) announcing the Company’s fiscal 2024 first quarter results of operations and projected outlook of certain items for fiscal year 2024. A copy of the Press Release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |
| 99.1 | Press Release issued by Cracker Barrel Old Country Store, Inc. dated November 30, 2023 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| Date: November 30, 2023 | CRACKER BARREL OLD COUNTRY STORE, INC. | |
| By: | /s/ Richard M. Wolfson | |
| Name: | Richard M. Wolfson | |
| Title: | Senior Vice President, General Counsel and Corporate Secretary | |
Exhibit 99.1
| Investor Contact: | Adam Hanan |
| (615) 443-9887 | |
| Media Contact: | Heidi Pearce |
| (615) 235-4135 |
CRACKER BARREL REPORTS FIRST QUARTER FISCAL 2024 RESULTS
Board declares $1.30 quarterly dividend per share
LEBANON, Tenn. – November 30, 2023 – Cracker Barrel Old Country Store, Inc. (“Cracker Barrel” or the “Company”) (Nasdaq: CBRL) today reported its financial results for the first quarter of fiscal 2024 ended October 27, 2023.
First Quarter Fiscal 2024 Highlights
| · | The Company reported first quarter total revenue of $823.8 million. Compared to the prior year first quarter, total revenue decreased 1.9%. |
| o | Comparable store restaurant sales decreased 0.5%, while comparable store retail sales decreased 8.1%. |
| · | GAAP operating income for the first quarter was $11.4 million, or 1.4% of total revenue, and adjusted1 operating income was $19.0 million, or 2.3% of total revenue. |
| · | GAAP net income was $5.5 million, or 0.7% of total revenue, and Adjusted EBITDA1 was $45.7 million, or 5.5% of total revenue. |
| · | GAAP earnings per diluted share were $0.25, and adjusted1 earnings per diluted share were $0.51. |
Commenting on the first quarter results, Cracker Barrel President and Chief Executive Officer Julie Masino said,
“We were pleased that we delivered sequential monthly improvements in our comparable store traffic performance during the first quarter. This improved trend was largely driven by the actions we took to improve the effectiveness of our marketing and our emphasis on the guest experience. We will continue to focus on these initiatives along with operational excellence, and we believe these efforts will resonate with guests and will support improved performance in the remainder of the fiscal year and beyond. Additionally, during the quarter we launched our Cracker Barrel Rewards loyalty program. Guests have embraced the program, and we are pleased with the levels of enrollment to date, which have exceeded expectations. We remain excited about this program and are confident it will be a meaningful differentiator and traffic driver over the long term.”
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Cracker Barrel Reports First Quarter Fiscal 2024 Results
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November 30, 2023
First Quarter Fiscal 2024 Results
Revenue
The Company reported total revenue of $823.8 million for the first quarter of fiscal 2024, representing a decrease of 1.9% compared to the first quarter of fiscal 2023.
Cracker Barrel comparable store restaurant sales decreased 0.5%, including total menu pricing increases of 6.8%. Comparable store retail sales decreased 8.1% from the prior year quarter.
Operating Income
GAAP operating income for the first quarter was $11.4 million, or 1.4% of total revenue, compared to $23.6 million, or 2.8% of total revenue, in the prior year quarter. Adjusted1 operating income for the first quarter was $19.0 million, or 2.3% of total revenue, compared to $30.0 million, or 3.6%, of total revenue in the prior year quarter.
The decrease in the Company’s GAAP and adjusted1 operating income as a percentage of total revenue versus the prior year quarter is primarily the result of higher labor and related expenses, higher other operating expenses, and higher general and administrative expenses, partially offset by lower cost of goods sold in the current year quarter.
Net Income, EBITDA, and Earnings per Diluted Share
GAAP net income for the first quarter was $5.5 million, or 0.7% of total revenue. This represented a 68% decrease compared to prior year quarter GAAP net income of $17.1 million, or 2.0% of total revenue. Adjusted EBITDA1 was $45.7 million, or 5.5% of total revenue, a 16.6% decrease compared to the prior year quarter Adjusted EBITDA1 of $54.8 million, or 6.5% of total revenue.
GAAP earnings per diluted share for the first quarter were $0.25, a 68% decrease compared to the prior year quarter GAAP earnings per diluted share of $0.77. Adjusted1 earnings per diluted share were $0.51, a 48% decrease compared to the prior year quarter adjusted1 earnings per diluted share of $0.99.
Quarterly Dividend Declaration
The Company announced that its Board of Directors declared a quarterly dividend of $1.30 per share on the Company’s common stock. The quarterly dividend is payable on February 13, 2024 to shareholders of record as of January 19, 2024.
Fiscal 2024 Outlook
The Company provided the following outlook for fiscal 2024:
| · | Total revenue of $3.4 billion to $3.5 billion |
| · | Two new Cracker Barrel stores and 9 to 11 new Maple Street Biscuit Company units |
| · | Commodity inflation in the low-single digits |
| · | Hourly wage inflation in the mid-single digits |
| · | GAAP operating income of $95 million to $115 million and adjusted1 operating income of $130 million to $150 million, which includes the impact from the 53rd week in the fiscal 2024 year |
| · | Capital expenditures of $120 million to $135 million |
The Company reminds investors that its outlook reflects a number of assumptions, many of which are outside the Company’s control. In particular, uncertainties created by macroeconomic conditions, such as ongoing inflation, low consumer confidence and high interest rates may adversely affect consumer behavior and cause actual results to differ materially from those expected.
1 For Non-GAAP reconciliations, please refer to the Reconciliation of GAAP-Basis Operating Results to Non-GAAP Operating Results section of this release.
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Cracker Barrel Reports First Quarter Fiscal 2024 Results
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November 30, 2023
Fiscal 2024 First Quarter Conference Call
As previously announced, the live broadcast of Cracker Barrel’s quarterly conference call will be available to the public online at investor.crackerbarrel.com today beginning at 11:00 a.m. (ET). The online replay will be available at 2:00 p.m. (ET) and continue through December 14, 2023.
About Cracker Barrel Old Country Store®
Cracker Barrel Old Country Store, Inc. (Nasdaq: CBRL) provides a caring and friendly home-away-from-home experience while offering guests high-quality homestyle food to enjoy in-store or to-go and unique shopping — all at a fair price. Established in 1969 in Lebanon, Tenn., Cracker Barrel and its affiliates operate over 660 company-owned Cracker Barrel Old Country Store® locations in 45 states and own the fast-casual Maple Street Biscuit Company. For more information about the Company, visit crackerbarrel.com.
CBRL-F
Except for specific historical information, certain of the matters discussed in this press release may express or imply projections of items such as revenues or expenditures, statements of plans and objectives or future operations or statements of future economic performance. These and similar statements regarding events or results that the Company expects will or may occur in the future are forward-looking statements concerning matters that involve risks, uncertainties and other factors which may cause the actual results and performance of the Company to differ materially from those expressed or implied by such forward-looking statements. All forward-looking information is provided pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995 and should be evaluated in the context of these risks, uncertainties and other factors. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "trends," "assumptions," "target," "guidance," "outlook," "opportunity," "future," "plans," "goals," "objectives," "expectations," "near-term," "long-term," "projection," "may," "will," "would," "could," "expect," "intend," "estimate," "anticipate," "believe," "potential," "regular," "should," "projects," "forecasts," or "continue" (or the negative or other derivatives of each of these terms) or similar terminology. The Company believes that the assumptions underlying any forward-looking statements are reasonable; however, any of the assumptions could be inaccurate, and therefore, actual results may differ materially from those projected in or implied by the forward-looking statements. In addition to the risks of ordinary business operations, factors and risks that may result in actual results differing from this forward-looking information include, but are not limited to risks and uncertainties associated with inflationary conditions with respect to the price of commodities, transportation, distribution and labor; disruptions to the Company’s restaurant or retail supply chain; the COVID-19 pandemic, including the duration of the COVID-19 pandemic and its ultimate impact on the Company’s business the Company’s ability to identify, acquire and sell successful new lines of retail merchandise and new menu items at its restaurants; the Company’s ability to sustain or the effects of plans intended to improve operational or marketing execution and performance; the effects of increased competition at the Company’s locations on sales and on labor recruiting, cost, and retention; consumer behavior based on negative publicity or changes in consumer health or dietary trends or safety aspects of the Company’s food or products or those of the restaurant industry in general, including concerns about outbreaks of infectious disease, as well as the possible effects of such events on the price or availability of ingredients used in the Company’s restaurants; the effects of the Company’s indebtedness and associated restrictions on the Company’s financial and operating flexibility and ability to execute or pursue its operating plans and objectives; changes in interest rates, increases in borrowed capital or capital market conditions affecting the Company’s financing costs and ability to refinance its indebtedness, in whole or in part; the Company’s reliance on limited distribution facilities and certain significant vendors; information technology-related incidents, including data privacy and information security breaches, whether as a result of infrastructure failures, employee or vendor errors, or actions of third parties; changes in or implementation of additional governmental or regulatory rules, regulations and interpretations affecting tax, wage and hour matters, health and safety, animal welfare, pensions, insurance or other undeterminable areas; the effects of plans intended to promote or protect our brands and products; the actual results of pending, future or threatened litigation or governmental investigations and the costs and effects of negative publicity or the Company’s ability to manage the impact of social media associated with these activities; the impact of activist shareholders; the Company’s ability to enter successfully into new geographic markets that may be less familiar to it; changes in land, building materials and construction costs; the availability and cost of suitable sites for restaurant development and the Company’s ability to identify those sites; the Company’s ability to retain key personnel; the ability of and cost to the Company to recruit, train, and retain qualified hourly and management employees; uncertain performance of acquired businesses, strategic investments and other initiatives that the Company may pursue from time to time; the effects of business trends on the outlook for individual restaurant locations and the effect on the carrying value of those locations; general or regional economic weakness, business and societal conditions and the weather impact on sales and customer travel; discretionary income or personal expenditure activity of the Company’s customers; economic or psychological effects of natural disasters or other unforeseen events such as terrorist acts, social unrest or war and the military or government responses to such events; changes in foreign exchange rates affecting the Company’s future retail inventory purchases; workers’ compensation, group health and utility price changes; implementation of new or changes in interpretation of existing accounting principles generally accepted in the United States of America ("GAAP"); and other factors described from time to time in our filings with the Securities and Exchange Commission, press releases, and other communications. Any forward-looking statement made by us herein, or elsewhere, speaks only as of the date on which made. We expressly disclaim any intent, obligation or undertaking to update or revise any forward-looking statements made herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.
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November 30, 2023
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited)
(In thousands, except share and per share amounts, percentages and ratios)
| First Quarter Ended | ||||||||||||
| 10/27/23 | 10/28/22 | Percentage Change | ||||||||||
| Total revenue | $ | 823,839 | $ | 839,519 | (2 | )% | ||||||
| Cost of goods sold (exclusive of depreciation & rent) | 255,559 | 281,540 | (9 | ) | ||||||||
| Labor and other related expenses | 304,447 | 291,708 | 4 | |||||||||
| Other store operating expenses | 203,685 | 196,704 | 4 | |||||||||
| General and administrative expenses | 48,735 | 45,948 | 6 | |||||||||
| Operating income | 11,413 | 23,619 | (52 | ) | ||||||||
| Interest expense | 4,938 | 3,532 | 40 | |||||||||
| Income before income taxes | 6,475 | 20,087 | (68 | ) | ||||||||
| Provision for income taxes | 1,019 | 2,958 | (66 | ) | ||||||||
| Net income | $ | 5,456 | $ | 17,129 | (68 | ) | ||||||
| Earnings per share – Basic: | $ | 0.25 | $ | 0.77 | (68 | ) | ||||||
| Earnings per share – Diluted: | $ | 0.25 | $ | 0.77 | (68 | ) | ||||||
| Weighted average shares: | ||||||||||||
| Basic | 22,165,852 | 22,193,774 | (0 | ) | ||||||||
| Diluted | 22,263,690 | 22,292,654 | (0 | ) | ||||||||
| Ratio Analysis | ||||||||||||
| Total revenue: | ||||||||||||
| Restaurant | 80.2 | % | 78.9 | % | ||||||||
| Retail | 19.8 | 21.1 | ||||||||||
| Total revenue | 100.0 | 100.0 | ||||||||||
| Cost of goods sold (exclusive of depreciation & rent) | 31.0 | 33.5 | ||||||||||
| Labor and other related expenses | 37.0 | 34.8 | ||||||||||
| Other store operating expenses | 24.7 | 23.4 | ||||||||||
| General and administrative expenses | 5.9 | 5.5 | ||||||||||
| Operating income | 1.4 | 2.8 | ||||||||||
| Interest expense | 0.6 | 0.4 | ||||||||||
| Income before income taxes | 0.8 | 2.4 | ||||||||||
| Provision for income taxes | 0.1 | 0.4 | ||||||||||
| Net income | 0.7 | % | 2.0 | % | ||||||||
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November 30, 2023
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited and in thousands, except share amounts)
| 10/27/23 | 10/28/22 | |||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 13,914 | $ | 38,705 | ||||
| Accounts receivable | 32,218 | 32,943 | ||||||
| Inventories | 207,269 | 231,010 | ||||||
| Prepaid expenses and other current assets | 34,288 | 28,583 | ||||||
| Property and equipment, net | 968,441 | 965,795 | ||||||
| Operating lease right-of-use assets, net | 891,371 | 918,725 | ||||||
| Intangible assets | 24,517 | 21,191 | ||||||
| Other assets | 42,923 | 45,411 | ||||||
| Goodwill | 4,690 | 4,690 | ||||||
| Total assets | $ | 2,219,631 | $ | 2,287,053 | ||||
| Liabilities and Shareholders’ Equity | ||||||||
| Accounts payable | $ | 143,294 | $ | 135,480 | ||||
| Other current liabilities | 318,604 | 334,040 | ||||||
| Long-term debt | 475,340 | 483,679 | ||||||
| Long-term operating lease liabilities | 696,871 | 714,155 | ||||||
| Other long-term obligations | 51,130 | 52,110 | ||||||
| Deferred income taxes | 74,140 | 80,076 | ||||||
| Shareholders’ equity, net | 460,252 | 487,513 | ||||||
| Total liabilities and shareholders’ equity | $ | 2,219,631 | $ | 2,287,053 | ||||
| Common shares issued and outstanding | 22,185,112 | 22,195,467 | ||||||
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November 30, 2023
CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
(Unaudited and in thousands)
| Three Months Ended | ||||||||
| 10/27/23 | 10/28/22 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 5,456 | $ | 17,129 | ||||
| Depreciation and amortization | 26,669 | 24,791 | ||||||
| Amortization of debt issuance costs | 436 | 431 | ||||||
| Loss on disposition of property and equipment | 1,632 | 683 | ||||||
| Share-based compensation | 1,622 | 2,422 | ||||||
| Noncash lease expense | 15,180 | 15,013 | ||||||
| Amortization of asset recognized from gain on sale and leaseback transaction | 3,184 | 3,184 | ||||||
| Increase in inventories | (17,905 | ) | (17,761 | ) | ||||
| Decrease in accounts payable | (22,190 | ) | (34,391 | ) | ||||
| Net changes in other assets and liabilities | (29,881 | ) | (12,101 | ) | ||||
| Net cash used in operating activities | (15,797 | ) | (600 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchase of property and equipment, net of insurance recoveries | (24,637 | ) | (21,626 | ) | ||||
| Proceeds from sale of property and equipment | 39 | 166 | ||||||
| Net cash used in investing activities | (24,598 | ) | (21,460 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Net proceeds under long-term debt | 60,000 | 60,000 | ||||||
| Taxes withheld from issuance of share-based compensation awards | (1,501 | ) | (2,380 | ) | ||||
| Purchases and retirement of common stock | 0 | (12,448 | ) | |||||
| Dividends on common stock | (29,337 | ) | (29,512 | ) | ||||
| Net cash provided by financing activities | 29,162 | 15,660 | ||||||
| Net decrease in cash and cash equivalents | (11,233 | ) | (6,400 | ) | ||||
| Cash and cash equivalents, beginning of period | 25,147 | 45,105 | ||||||
| Cash and cash equivalents, end of period | $ | 13,914 | $ | 38,705 | ||||
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November 30, 2023
| First Quarter Ended | ||||||||
| 10/27/23 | 10/28/22 | |||||||
| Net Change in Company-Owned Units During Quarter: | ||||||||
| Cracker Barrel | 1 | 0 | ||||||
| Maple Street Biscuit Company | 1 | 3 | ||||||
| Company-Owned Units in Operation at End of Quarter: | ||||||||
| Cracker Barrel | 661 | 664 | ||||||
| Maple Street Biscuit Company | 60 | 54 | ||||||
| First Quarter Ended | ||||||||
| 10/27/23 | 10/28/22 | |||||||
| Total revenue*: (In thousands) | ||||||||
| Restaurant | $ | 644,889 | $ | 647,245 | ||||
| Retail | 163,034 | 177,141 | ||||||
| Total revenue | $ | 807,923 | $ | 824,386 | ||||
| Cost of goods sold* (exclusive of depreciation and rent): (In thousands) | ||||||||
| Restaurant | $ | 169,572 | $ | 188,505 | ||||
| Retail | 82,084 | 88,926 | ||||||
| Total cost of goods sold | $ | 251,656 | $ | 277,431 | ||||
| Average unit volume*: (In thousands) | ||||||||
| Restaurant | $ | 975.6 | $ | 974.9 | ||||
| Retail | 246.7 | 266.8 | ||||||
| Total | $ | 1,222.3 | $ | 1,241.7 | ||||
| Operating weeks*: | 8,593 | 8,631 | ||||||
Note*: This information is for Cracker Barrel stores only and excludes Maple Street Biscuit Company
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Cracker Barrel Reports First Quarter Fiscal 2024 Results
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November 30, 2023
CRACKER BARREL OLD COUNTRY STORE, INC.
Reconciliation of GAAP-Basis Operating Results to Non-GAAP Operating Results
(Unaudited and in thousands, except per share amounts)
Adjusted Operating Income and Earnings Per Share
In the accompanying press release, the Company makes reference to its first quarter fiscal 2023 and fiscal 2024 adjusted operating income and earnings per share. In regard to fiscal 2023, this reconciliation excludes the non-cash amortization of the asset recognized from the gains on the sale and leaseback transactions and expenses related to the proxy contest and settlement in connection with the Company’s 2022 annual meeting of shareholders and the related tax impacts. In regard to fiscal 2024, this reconciliation excludes the non-cash amortization of the asset recognized from the gains on the sale and leaseback transactions, expenses related to the Company’s CEO transition, expenses associated with a strategic transformation initiative, and a corporate restructuring charge and the related tax impacts. The Company believes excluding these items from its financial results provides investors with an enhanced understanding of the Company's financial results and enhances comparability across periods. This information is not intended to be considered in isolation or as a substitute for operating income or earnings per share information prepared in accordance with GAAP.
| First Quarter Ended October 27, 2023 | ||||||||||||
| As Reported | Adjustment | As Adjusted | ||||||||||
| (1) | ||||||||||||
| Total Revenue | $ | 823,839 | $ | 0 | $ | 823,839 | ||||||
| Store operating expense | 763,691 | (3,184 | ) | 760,507 | ||||||||
| General and administrative expense | 48,735 | (4,419 | ) | 44,316 | ||||||||
| Operating income | 11,413 | 7,603 | 19,016 | |||||||||
| Interest expense | 4,938 | 0 | 4,938 | |||||||||
| Income before income taxes | 6,475 | 7,603 | 14,078 | |||||||||
| Provision for income taxes | 1,019 | 1,787 | 2,806 | |||||||||
| Net income | $ | 5,456 | $ | 5,816 | $ | 11,272 | ||||||
| Earnings per share – basic | $ | 0.25 | $ | 0.26 | $ | 0.51 | ||||||
| Earnings per share – diluted | $ | 0.25 | $ | 0.26 | $ | 0.51 | ||||||
(1) Adjusted for the non-cash amortization of the asset recognized from the gains on the sale and leaseback transactions, expenses related to the Company’s CEO transition, expenses associated with a strategic transformation initiative, and a corporate restructuring charge and the related tax impacts.
| First Quarter Ended October 28, 2022 | ||||||||||||
| As Reported | Adjustment | As Adjusted | ||||||||||
| (1) | ||||||||||||
| Total Revenue | $ | 839,519 | $ | 0 | $ | 839,519 | ||||||
| Store operating expense | 769,952 | (3,184 | ) | 766,768 | ||||||||
| General and administrative expense | 45,948 | (3,198 | ) | 42,750 | ||||||||
| Operating income | 23,619 | 6,382 | 30,001 | |||||||||
| Interest expense | 3,532 | 0 | 3,532 | |||||||||
| Income before income taxes | 20,087 | 6,382 | 26,469 | |||||||||
| Provision for income taxes | 2,958 | 1,500 | 4,458 | |||||||||
| Net income | $ | 17,129 | $ | 4,882 | $ | 22,011 | ||||||
| Earnings per share – basic | $ | 0.77 | $ | 0.22 | $ | 0.99 | ||||||
| Earnings per share – diluted | $ | 0.77 | $ | 0.22 | $ | 0.99 | ||||||
(1) Adjusted for the non-cash amortization of the asset recognized from the gains on the sale and leaseback transactions and expenses related to the proxy contest and settlement in connection with the Company’s 2022 annual meeting of shareholders and the related tax impacts.
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November 30, 2023
CRACKER BARREL OLD COUNTRY STORE, INC.
Reconciliation of GAAP-Basis Operating Results to Non-GAAP Operating Results
(Unaudited and in thousands)
EBITDA
In the accompanying press release, the Company makes reference to its first quarter fiscal 2023 and fiscal 2024 EBITDA. The Company defines EBITDA as net income excluding depreciation and amortization, non-cash amortization of the asset recognized from the gains on sale and leaseback transactions, interest expense and tax expense. In regard to fiscal 2023, the Company further adjusts EBITDA to exclude expenses related to the proxy contest and settlement in connection with the Company’s 2022 annual meeting of shareholders and the related tax impacts. In regard to fiscal 2024, the Company further adjusts EBITDA to exclude expenses related to the Company’s CEO transition, expenses associated with a strategic transformation initiative, and a corporate restructuring charge and the related tax impacts. The Company believes that presentation of EBITDA and Adjusted EBITDA provides investors with an enhanced understanding of the Company's operating performance and debt leverage metrics and enhances comparability with the Company’s historical results, and that the presentation of this non-GAAP financial measure, when combined with the primary presentation of net income, is beneficial to an investor’s complete understanding of the Company’s operating performance. This information is not intended to be considered in isolation or as a substitute for net income prepared in accordance with GAAP.
| First Quarter Ended October 27, 2023 | ||||
| Net Income | $ | 5,456 | ||
| (+) Depreciation & amortization | 26,669 | |||
| (+) Amortization of asset recognized from gain on sale and leaseback transactions | 3,184 | |||
| (+) Interest expense | 4,938 | |||
| (+) Tax expense | 1,019 | |||
| EBITDA | $ | 41,266 | ||
| Adjustments | ||||
| (+) CEO transition expenses | 1,636 | |||
| (+) Strategic transformation initiative expenses | 1,141 | |||
| (+) Corporate restructuring charge | 1,642 | |||
| Adjusted EBITDA | $ | 45,685 | ||
| First Quarter Ended October 28, 2022 | ||||
| Net Income | $ | 17,129 | ||
| (+) Depreciation & amortization | 24,791 | |||
| (+) Amortization of asset recognized from gain on sale and leaseback transactions | 3,184 | |||
| (+) Interest expense | 3,532 | |||
| (+) Tax expense | 2,958 | |||
| EBITDA | $ | 51,594 | ||
| Adjustments | ||||
| (+) Proxy contest and settlement expenses | 3,198 | |||
| Adjusted EBITDA | $ | 54,792 | ||
Reconciliation of GAAP Operating Income Outlook to Non-GAAP Operating Income Outlook
In the accompanying press release, the Company provides its current outlook for adjusted operating income, a non-GAAP financial measure, for fiscal 2024. The Company’s adjusted operating income outlook excludes the non-cash amortization of the asset recognized from the gains on the sale and leaseback transactions, expenses related to the Company’s CEO transition, expenses associated with a strategic transformation initiative, and a corporate restructuring charge and the related tax impacts. The Company believes presenting its current outlook for adjusted operating income that excludes these items provides investors with an enhanced understanding of the Company's expected performance and enhances comparability with the Company’s historical results. This information is not intended to be considered in isolation or as a substitute for operating income outlook reported in accordance with GAAP.
$ Million | |||||||||
| Reported GAAP Operating Income Outlook | $ | 95 | to | $ | 115 | ||||
| Non-cash amortization of the asset recognized from the gain on sale and leaseback transactions | $ | 13 | $ | 13 | |||||
| Expenses related to CEO transition | $ | 10 | $ | 10 | |||||
| Expenses related to strategic transformation initiative | $ | 10 | $ | 10 | |||||
| Corporate restructuring charge | $ | 2 | $ | 2 | |||||
| Adjusted Operating Income Outlook | $ | 130 | to | $ | 150 | ||||
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