Comparable Store Traffic, Restaurant and Retail Sales Positive in Quarter

Adjusted Earnings Per Diluted Share Increased 48.3% Compared with Prior Year Quarter

LEBANON, Tenn.--(BUSINESS WIRE)-- Cracker Barrel Old Country Store, Inc. ("Cracker Barrel" or the "Company") (Nasdaq: CBRL) today reported financial results for the third quarter of fiscal 2012 ended April 27, 2012, and increased its full-year earnings guidance.

Third-Quarter Fiscal 2012 Highlights

• Adjusted earnings per diluted share, which excludes severance and other charges relating to recent organization changes, of $0.86 were 48.3% above prior year quarter (see non-GAAP reconciliation below). On a GAAP basis, earnings per diluted share were $0.81 compared with $0.64 in the prior year quarter.
• Comparable store restaurant and retail sales increased by 3.1% and 0.3%, respectively, over the prior year quarter. Total revenue was $608.5 million, an increase of 4.5% compared with the prior year quarter.
• Second consecutive quarter of positive traffic and outperformance of Knapp-Track^TM industry benchmark.
• Adjusted operating income margin was 6.7% of total revenue compared with 5.0% in the prior year quarter. On a GAAP basis, operating income margin was 6.4% of total revenue, compared with 5.4% in the prior year quarter.

Third Quarter Fiscal 2012 Results

Revenue

The Company reported total revenue of $608.5 million for the third quarter of fiscal 2012 representing an increase of 4.5% over the third quarter of fiscal 2011. Comparable store restaurant sales increased 3.1%, including a 2.5% increase in average check. The average menu price increase for the quarter was approximately 2.4%. Comparable store retail sales were up 0.3% for the quarter. During the quarter, the Company opened five new Cracker Barrel stores, and has opened two additional stores since the end of the quarter, for a total of 12 new store openings year-to-date.

Comparable store restaurant and retail sales for the fiscal months of February, March and April were as follows:

		February		March		April		Third
								Quarter
Comparable restaurant traffic		2.8%		-0.7%		-0.1%		0.6%
Average check		2.7%		2.9%		2.0%		2.5%
Comparable restaurant sales		5.5%		2.2%		1.9%		3.1%
Comparable retail sales		3.2%		1.0%		-2.1%		0.3%

Operating Income

In the third quarter of fiscal 2012, adjusted operating income was $40.8 million, or 6.7% of total revenue, compared with adjusted operating income of $29.2 million, or 5.0% of total revenue, in the third quarter of fiscal 2011. On a GAAP basis, which includes severance and other charges related to the Company's recently announced organizational restructuring, operating income was $39.1 million, or 6.4% of total revenue. The increase in adjusted operating income was primarily the result of lower hourly labor, advertising, and employee benefits expenses as a percentage of sales, partially offset by higher cost of goods sold. Adjusted general and administrative expenses were lower at 5.4% of total revenue in the third quarter of fiscal 2012 compared with 5.8% in the prior year quarter. On a GAAP basis, general and administrative expenses were 5.7% of total revenue in the third quarter of fiscal 2012.

"Driven by our strong sales, traffic and margin performance, our financial results, including our significantly increased operating margin, for the third quarter exceeded our expectations," said Sandra B. Cochran, President and Chief Executive Officer of Cracker Barrel Old Country Store, Inc. "Comparable store traffic and sales outperformed the Knapp-Track™ Index for the quarter, and we are pleased to report positive traffic for the second consecutive quarter. The plan we laid out in September of last year continues to generate the steady improvements in both revenue and profitability that we expected. We continued to control our expenses and realize the expected benefits from our cost reduction initiatives. Our diluted earnings per share, adjusted for this year's reorganization charges and last year's gain on a property sale, grew by almost 50% in the quarter. These positive trends, along with strong cash flow generation, gave the Board confidence to return more cash to our shareholders with the previously-announced 60% increase in the quarterly dividend."

Year-to-date Fiscal 2012 Results

Year-to-date through the end of the third quarter, total revenue was $1.9 billion, an increase of 3.2% compared with the first nine months of fiscal 2011. Comparable store restaurant sales increased 1.7%, including a 2.4% higher check, and comparable store retail sales increased 1.1%.

Year-to-date, the Company reported adjusted net income of $73.2 million or $3.14 per diluted share, compared with adjusted net income of $66.3 million, or $2.79 per diluted share in the prior year period. On a GAAP basis, year-to-date net income was $68.4 million or $2.93 per diluted share. Year-to-date net cash flow provided by operating activities increased to $141.9 million, compared with $89.2 million in the prior year period primarily as a result of timing differences in accounts payable and estimated income taxes, and changes in other assets and liabilities. In addition, the Company repurchased 220,400 shares during the third quarter of fiscal 2012.

A reconciliation of the Company's financial results determined in accordance with GAAP to certain non-GAAP financial measures used in this release has been provided in the financial statement tables included in this release to supplement its unaudited financial statements presented on a GAAP basis.

Fiscal 2012 Outlook Update

The Company commented that its financial outlook for future periods reflects many assumptions, the accuracy of which is not yet known. Based upon year-to-date financial performance, recent trends and current estimates, the Company raised its full-year earnings guidance for fiscal 2012. The Company expects total revenue for fiscal 2012 of between $2.55 billion and $2.6 billion, reflecting anticipated increases in comparable store restaurant and retail sales in a range of 1.5% and 2.0%, and the opening of 13 new Cracker Barrel stores in the current fiscal year. The Company now expects to report adjusted earnings per diluted share for the fiscal year of between $4.35 and $4.45, excluding proxy contest and severance expenses totaling $0.21 per diluted share. On a GAAP basis, the Company expects to report earnings per diluted share for the fiscal year of between $4.14 and $4.24. The Company reminds investors that its 2012 fiscal year is a 53-week year and that the impact of the 53^rd week, which is included in its guidance, is expected to be additional revenue of approximately $50 million and approximately $0.25 of additional earnings per diluted share.

Food commodity costs for the current fiscal year are expected to increase 5.0% to 5.5% from the prior year, and adjusted operating income margins are expected to range between 7.4% and 7.6% of total revenues. The Company expects depreciation expense of between $64 million and $66 million; net interest expense of approximately $45 million; an effective tax rate of between 29% and 30%; and capital expenditures of between $85 million and $90 million.

In order to provide additional visibility into its expectations for future performance, the Company provided a preliminary earnings estimate for its 2013 fiscal year. Based upon its current outlook for comparable store sales, new store openings, commodity cost increases, and the impact of its cost savings initiatives, the Company expects to generate earnings per diluted share of between $4.50 and $4.70. After adjustments for proxy contest expenses, severance charges, and the impact of the 53^rd week on the current year's results, this represents a year-over-year percentage increase in the high single digits.

Commenting on the outlook, Ms. Cochran said, "We are pleased with the progress we have made over the last three quarters and the momentum leading us into our final fiscal quarter. In April, we outlined our longer term, three-pronged strategy for growth and increasing shareholder return - enhancing the core business, expanding the store footprint and extending the Cracker Barrel brand. In the near term, we will continue to focus on enhancing the core business through our six business initiatives to drive restaurant traffic, grow retail sales and control costs. We remain encouraged by our results and look to build on our successes in the fourth quarter and into the next fiscal year."

Fiscal 2012 Third-Quarter Conference Call

As previously announced, the live broadcast of today's quarterly conference call will be available to the public on-line in the News and Events section on the Company's website at investor.crackerbarrel.com today beginning at 11:00 a.m. (Eastern Time). The on-line replay will be available at 2:00 p.m. (Eastern Time) and continue through June 5, 2012.

The Company plans to announce its fiscal 2012 fourth-quarter earnings and comparable restaurant and retail sales on Tuesday, September 18, 2012.

About Cracker Barrel

Cracker Barrel Old Country Store^® restaurants provide a friendly home-away-from-home in its old country stores and restaurants. Guests are cared for like family while relaxing and enjoying real home-style food and shopping that's surprisingly unique, genuinely fun and reminiscent of America's country heritage…all at a fair price. The restaurants serve up delicious, home-style country food such as meatloaf and homemade chicken n' dumplins as well as the Company's signature biscuits using an old family recipe. The authentic old country retail store is fun to shop and offers unique gifts and self-indulgences.

Cracker Barrel Old Country Store, Inc. (Nasdaq: CBRL) was established in 1969 in Lebanon, Tenn. and operates 615 company-owned locations in 42 states. Every Cracker Barrel unit is open seven days a week with hours Sunday through Thursday, 6 a.m. — 10 p.m., and Friday and Saturday, 6 a.m. - 11 p.m. For more information, 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 revenues or expenditures, statements of plans and objectives or future operations or statements of future economic performance. These, and similar statements are forward-looking statements concerning matters that involve risks, uncertainties and other factors which may cause the actual performance of Cracker Barrel Old Country Store, Inc. and its subsidiaries to differ materially from those expressed or implied by this discussion. 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 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 and include the expected effects of operational improvement initiatives, such as new menu items and retail offerings. Factors which could materially affect actual results include, but are not limited to: the effects of uncertain consumer confidence, higher costs for energy, general or regional economic weakness, weather on sales and customer travel, and discretionary income or personal expenditure activity of our customers; our ability to identify, acquire and sell successful new lines of retail merchandise and new menu items at our restaurants; our ability to successfully implement or sustain plans intended to improve operational or marketing execution and performance; changes in or implementation of additional governmental or regulatory rules, regulations and interpretations affecting tax, wage and hour matters, health and safety, pensions, insurance or other undeterminable areas; our ability to successfully implement plans intended to promote or protect our brands and products; commodity price increases; the ability of and cost to us to recruit, train, and retain qualified hourly and management employees in an escalating wage environment; the effects of increased competition at our locations on sales and on labor recruiting, cost, and retention; workers' compensation, group health and utility price changes; consumer behavior based on negative publicity or concerns over nutritional or safety aspects of our food or products or those of the restaurant industry in general, including concerns about pandemics, as well as the possible effects of such events on the price or availability of ingredients used in our restaurants; the effects of our substantial indebtedness and associated restrictions on our financial and operating flexibility and ability to execute or pursue our operating plans and objectives; changes in interest rates or capital market conditions affecting our financing costs and ability to refinance all or portions of our indebtedness; the effects of business trends on the outlook for individual restaurant locations and the effect on the carrying value of those locations; the availability and cost of suitable sites for restaurant development and our ability to identify those sites; changes in land, building materials and construction costs; the actual results of pending, future or threatened litigation or governmental investigations and the costs and effects of negative publicity associated with these activities; practical or psychological effects of natural disasters or terrorist acts or war and military or government responses; disruptions to our restaurant or retail supply chain; changes in foreign exchange rates affecting our future retail inventory purchases; implementation of new or changes in interpretation of existing accounting principles generally accepted in the United States of America; 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.

CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited)
(In thousands, except share and per share amounts, percentages and ratios)
		Third Quarter Ended											Nine Months Ended
										Percentage											Percentage
			4/27/12				4/29/11			Change				4/27/12				4/29/11			Change
Total revenue		$	608,514			$	582,525			5	%		$	1,880,185			$	1,821,493			3	%
Cost of goods sold			189,615				179,774			5				611,313				578,917			6
Gross profit			418,899				402,751			4				1,268,872				1,242,576			2
Labor and other related expenses			235,275				227,437			3				691,176				675,223			2
Other store operating expenses			109,947				112,112			(2	)			338,127				336,235			1
Store operating income			73,677				63,202			17				239,569				231,118			4
General and administrative expenses			34,569				33,955			2				108,500				103,899			4
Impairment and store dispositions, net			--				(1,958	)		(100	)			--				(1,874	)		(100	)
Operating income			39,108				31,205			25				131,069				129,093			2
Interest expense			11,173				11,619			(4	)			33,333				35,163			(5	)
Pretax income			27,935				19,586			43				97,736				93,930			4
Provision for income taxes			8,961				4,432			102				29,351				26,265			12
Net income		$	18,974			$	15,154			25			$	68,385			$	67,665			1
Earnings per share — Basic:		$	0.82			$	0.66			24			$	2.97			$	2.94			1
Earnings per share — Diluted:		$	0.81			$	0.64			27			$	2.93			$	2.85			3
Weighted average shares:
Basic			23,132,730				23,048,279			0				22,990,544				23,039,388			(0	)
Diluted			23,535,765				23,602,333			(0	)			23,329,230				23,705,155			(2	)
Ratio Analysis
Total revenue:
Restaurant			82.2	%			81.8	%						79.0	%			78.9	%
Retail			17.8				18.2							21.0				21.1
Total revenue			100.0				100.0							100.0				100.0
Cost of goods sold			31.2				30.9							32.5				31.8
Gross profit			68.8				69.1							67.5				68.2
Labor and other related expenses			38.6				39.0							36.8				37.1
Other store operating expenses			18.1				19.3							18.0				18.4
Store operating income			12.1				10.8							12.7				12.7
General and administrative expenses			5.7				5.8							5.7				5.7
Impairment and store dispositions, net			0.0				(0.4	)						0.0				(0.1	)
Operating income			6.4				5.4							7.0				7.1
Interest expense			1.8				2.0							1.8				1.9
Pretax income			4.6				3.4							5.2				5.2
Provision for income taxes			1.5				0.8							1.6				1.5
Net income			3.1	%			2.6	%						3.6	%			3.7	%

CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited and in thousands, except share amounts)
		4/27/12			7/29/11
Assets
Cash and cash equivalents		$	127,320		$	52,274
Inventory			131,004			141,547
Other current assets			49,658			52,094
Property and equipment, net			1,016,469			1,009,164
Other long-lived assets			56,301			55,805
Total assets		$	1,380,752		$	1,310,884
Liabilities and Shareholders' Equity
Accounts payable		$	87,656		$	99,679
Current maturities			14,178			123
Other current liabilities			194,382			167,301
Long-term debt			536,001			550,143
Other long-term obligations			212,284			225,604
Shareholders' equity			336,251			268,034
Total liabilities and shareholders' equity		$	1,380,752		$	1,310,884
Common shares outstanding			23,225,767			22,840,974

CRACKER BARREL OLD COUNTRY STORE, INC.
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
(Unaudited and in thousands)
		Nine Months Ended
		4/27/12				4/29/11
Cash flows from operating activities:
Net income		$	68,385			$	67,665
Depreciation and amortization			47,742				46,537
Loss on disposition of property and equipment			1,832				(2,062	)
Impairment			0				2,175
Share-based compensation, net of excess tax benefit			7,509				4,997
Decrease in inventories			10,543				12,084
(Decrease) in accounts payable			(12,023	)			(33,964	)
Net changes in other assets and liabilities			17,897				(8,254	)
Net cash provided by operating activities			141,885				89,178
Cash flows from investing activities:
Purchase of property and equipment, net of insurance recoveries			(56,766	)			(59,284	)
Proceeds from sale of property and equipment			491				8,124
Net cash used in investing activities			(56,275	)			(51,160	)
Cash flows from financing activities:
Net payments for credit facilities and other long-term obligations			(104	)			(5,233	)
Proceeds from exercise of share-based compensation awards			16,729				20,107
Excess tax benefit from share-based compensation			1,921				2,338
Purchase and retirement of common stock			(12,279	)			(25,644	)
Deferred financing costs			(263	)			0
Dividends on common stock			(16,568	)			(14,800	)
Net cash used in financing activities			(10,564	)			(23,232	)
Net increase in cash and cash equivalents			75,046				14,786
Cash and cash equivalents, beginning of period			52,274				47,700
Cash and cash equivalents, end of period		$	127,320			$	62,486

CRACKER BARREL OLD COUNTRY STORE, INC.
Supplemental Information
(Unaudited)
		Third Quarter Ended							Nine Months Ended
		4/27/12			4/29/11				4/27/12			4/29/11
Units in operation:
Open at beginning of period			608			597				603			593
Opened during period			5			4				10			8
Open at end of period			613			601				613			601
Total revenue: (In thousands)
Restaurant		$	500,025		$	476,361			$	1,485,065		$	1,436,790
Retail			108,489			106,164				395,120			384,703
Total revenue		$	608,514		$	582,525			$	1,880,185		$	1,821,493
Cost of goods sold: (In thousands)
Restaurant		$	135,301		$	127,975			$	401,453		$	377,557
Retail			54,314			51,799				209,860			201,360
Total cost of goods sold		$	189,615		$	179,774			$	611,313		$	578,917
Average unit volume: (In thousands)
Restaurant		$	817.9		$	794.9			$	2,443.4		$	2,407.1
Retail			177.4			177.2				650.1			644.5
Total		$	995.3		$	972.1			$	3,093.5		$	3,051.6
Operating weeks:			7,948			7,790				23,704			23,279

		Q3 2012 vs. Q3 2011		9 mo. 2012 vs. 9 mo. 2011
Comparable store sales period to period increase:
Restaurant		3.1%		1.7%
Retail		0.3%		1.1%
Number of locations in comparable store base		592		591

CRACKER BARREL OLD COUNTRY STORE, INC.

Reconciliation of GAAP basis operating

results to adjusted non-GAAP operating results

(Unaudited and in thousands)

The Company makes reference in this release to "adjusted operating income," "adjusted net income," "adjusted earnings per diluted share," and "adjusted general and administrative expenses" before the impact of proxy contest expenses, severance and restructuring charges and the benefit of store dispositions net of an impairment. The Company believes that excluding these items and their related tax effects from its financial results reflects operating results that are more indicative of the Company's ongoing operating performance while improving comparability to prior periods, and, as such may provide investors with an enhanced understanding of the Company's past financial performance and prospects for the future. This information is not intended to be considered in isolation or as a substitute for operating income, net income, or earnings per share or expense information prepared in accordance with GAAP.

		Third Quarter ended April 27, 2012											Third Quarter ended April 29, 2011
		As Reported			Adjustments (1)				As Adjusted				As Reported				Adjustments (2)				As Adjusted
Store operating income		$	73,677		$	-			$	73,677			$	63,202			$	-			$	63,202
General and administrative expenses			34,569			(1,660	)			32,909				33,955								33,955
Impairment and store dispositions, net			-			-				-				(1,958	)			1,958				-
Operating income			39,108			1,660				40,768				31,205				(1,958	)			29,247
Interest expense			11,173			-				11,173				11,619				-				11,619
Pretax income			27,935			1,660				29,595				19,586				(1,958	)			17,628
Provision for income taxes			8,961			532				9,493				4,432				(443	)			3,989
Net income		$	18,974		$	1,128			$	20,102			$	15,154			$	(1,515	)		$	13,639
Earning per share - Basic		$	0.82		$	0.05			$	0.87			$	0.66			$	(0.07	)		$	0.59
Earning per share - Diluted		$	0.81		$	0.05			$	0.86			$	0.64			$	(0.06	)		$	0.58
		Nine months ended April 27, 2012											Nine months ended April 29, 2011
		As Reported			Adjustments (1),(3)				As Adjusted				As Reported				Adjustments (2)				As Adjusted
Store operating income		$	239,569		$	-			$	239,569			$	231,118			$	-			$	231,118
General and administrative expenses			108,500			(6,863	)			101,637				103,899								103,899
Impairment and store dispositions, net			-			-				-				(1,874	)			1,874				-
Operating income			131,069			6,863				137,932				129,093				(1,874	)			127,219
Interest expense			33,333			-				33,333				35,163				-				35,163
Pretax income			97,736			6,863				104,599				93,930				(1,874	)			92,056
Provision for income taxes			29,351			2,061				31,412				26,265				(524	)			25,741
Net income		$	68,385		$	4,802			$	73,187			$	67,665			$	(1,350	)		$	66,315
Earning per share - Basic		$	2.97		$	0.21			$	3.18			$	2.94			$	(0.06	)		$	2.88
Earning per share - Diluted		$	2.93		$	0.21			$	3.14			$	2.85			$	(0.06	)		$	2.79

(1)		Severance, other charges and related tax effects related to operational restructuring.
(2)		Gain on sale of property net of an impairment and related tax effects.
(3)		Charges and tax effects of the proxy contest concluded at the Company's annual meeting of shareholders.

Cracker Barrel Old Country Store, Inc.
Investor:
Lawrence E. Hyatt, 615-235-4432
or
Media:
Julie K. Davis, 615-443-9266

Source: Cracker Barrel Old Country Store, Inc.

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