Cracker Barrel is upgrading three of its most popular dinner offerings while separately using proceeds from a real estate transaction involving 26 company-owned restaurants to reduce debt and support future growth.
The Lebanon, Tennessee-based chain said Wednesday that it plans to improve the quality of its chicken, hamburger and steak dinners, calling dinner its “biggest opportunity” as it works to improve guest satisfaction.
“We are making investments to improve food quality,” President and CEO Dave Deno said during the company’s fourth-quarter earnings call. “Dinner is our biggest opportunity, and we plan to upgrade our chicken, hamburger, and steak offerings.”
Deno said Cracker Barrel wants to ensure its food consistently meets guests’ expectations for “taste, temperature, and quality on every visit.”
The chief executive said his priorities are centered on food, the guest experience and employees as Cracker Barrel works to build on improving traffic and profitability.
“A big part of my management philosophy is doing fewer things better and concentrating on opportunities that could have the greatest impact,” Deno said. “For restaurants, the formula is pretty straightforward. You must offer great food, provide a great guest experience, and hire and retain excellent employees who deliver both.”
“These are the priorities that we will be focused on: food, experience and people,” he added.
Alongside the menu upgrades, Cracker Barrel said it completed a sale-leaseback transaction involving 26 company-owned restaurants that generated approximately $77 million in net proceeds.
“The sale leaseback transaction generated $77 million in net proceeds, which were used to pay down debt and partially offset the $150 million debt related to the 0.625% convertible senior notes that matured and was repaid in June,” Chief Financial Officer Craig Pommells said. “The quarter ended with total debt of $337.2 million, which was $147.4 million below the prior year.”
Deno said Cracker Barrel continues to see pressure among lower-income consumers, though customer trends have improved.
“When it comes to us specifically, yes, we do see some pressure with our low-income guests, but our trends, as I said, have gotten better,” Deno said.
Still, Chief Financial Officer Craig Pommells said the chain’s value remains an advantage, noting the average guest check is about $16.
“If you’re feeling pressured from a discretionary income perspective, there are a lot of ways you can still have a great experience at Cracker Barrel,” Pommells said.
The company also said higher freight costs, including fuel surcharges, are already factored into its fiscal 2027 outlook.
“We are seeing fuel surcharges and so on related to freight, both from the perspective of retail, but to a lesser degree on the restaurant side. All of that’s built into our projection with the best information that we have today,” Pommells said.
Deno took over as CEO in August following the departure of Julie Masino, whose tenure included a rebrand that drew criticism from some longtime customers.
The overhaul, part of a roughly $700 million investment across Cracker Barrel’s restaurants, included updates to store interiors, menu changes and the temporary removal of the chain’s iconic “Old Timer” logo before it was later restored.