Cracker Barrel 2005 Annual Report Download - page 10

Download and view the complete annual report

Please find page 10 of the 2005 Cracker Barrel annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 68

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68

8
worse in early fiscal 2006 as gasoline prices reached
and surpassed the $3.00 level.
But it wasn’t just external factors. We also made
some mistakes, but we intend to learn from them.
Following unusually strong retail sales in the first
three quarters of fiscal 2004, we relied on the
continued appeal of too many of those same products
in fiscal 2005, with the consequence that we didn’t
have enough fresh new merchandise. Our most loyal
guests who visit frequently aren’t going to buy
last year’s merchandise when they already have it at
home or bought it as a gift. In addition, we have
had several instances of product arriving at the stores
later than planned.
These difficult external issues make it more
important that we execute better than ever. We’re
not asking our guest to make a major retail purchase,
only to part with a few dollars to acquire some-
thing unique, nostalgic, and authentic. To that end,
we have been introducing a greater selection of
product at price-points below $20. In an environment
where consumers are protecting their discretionary
income we continue to seek ways to make the retail
purchase decision easier on our guest by having
desirable products at a good value, just as we try to
do with the food we serve in the restaurant.
And, we have had some successes. Our sponsor-
ship of the Alison Krauss and Union Station tour
and the exclusive “Home on the Highways” CD is the
first of what may be several exclusive audio offer-
ings from major performers. Recently we announced
exclusive recordings from Charlie Daniels and
from Sara Evans. We have plans in place to keep the
merchandise fresher, to improve the store layout,
and to improve our sourcing using a successful foreign
trading company as our new agent. We have
added to the merchandising, operations and planning
teams, and the new leadership is focused on
executing our strategy.
COMMITMENT TO SHAREHOLDER RETURN
In addition to our operating strategies, we are
committed to returning value to our shareholders
through a policy of maintaining a strong balance
sheet by managing our capital structure and returning
cash in the form of dividends and share repur-
chases. Over the past five years, we have generated
CBRL Group, Inc. Cash Flow From Operations and
Capital Expenditures
$300
$200
$100
$0
$ Millions
2001 2002 2003 2004 2005
Fiscal Year
Cash Provided from Operations
Cash Used for Purchase of Property & Equipment
CBRL Group, Inc. Cumulative Share
Repurchases
$250
$200
$150
$100
$50
$0
($ Millions)Share Repurchases
Cumulative Shares Repurchased
(in millions)
30
20
10
0
Share Repurchases (cash outlays per year)
Cumulative Shares Repurchased
20051999 2000 2001 2002 2003 2004
Fiscal Year