Cracker Barrel pays down another $45 million debt since third quarter

By Susanna Moon

Chicago, June 22 - Cracker Barrel Old Country Store, Inc. has reduced its debt load substantially over the past year and a half, including paying down $45 million "the other day," according to chairman, president and chief executive officer Michael A. Woodhouse at the Jefferies 2010 Global Consumer Conference on Tuesday.

"On the balance sheet side, we're managing the capital structure to sustain growth but also to maintain flexibility," he said.

The company paid down more than $140 million in fiscal 2009, including a sale lease-back of 15 stores, Woodhouse said.

He noted the company has strong cash flow to fund growth, pay dividends and repurchase shares.

"We feel pretty good about our ability to get back to a reasonable level of growth," he said.

During the recession, the company has cut back on unit growth and instead focused on strengthening its presence in existing markets, where it has already been successful. The idea is to benefit from the efficiency of having more stores in a market, he said.

Woodhouse said the chain has added just six stores in the fiscal year but that the company is looking to "ramp up unit growth as we work our way back to a stronger economy."

"We're managing our business every day to satisfy our guests. That's why we're successful. That's how we're going to stay in business, but we're also obviously managing our business to generate cash and shareholder returns," he said.

Cracker Barrel is a Lebanon, Tenn.-based operator of restaurants.

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