Cracker Barrel sells Maple Street Biscuit Company and closes 16 restaurant locations
Cracker Barrel, the well-known Southern-themed restaurant chain, is undertaking significant changes aimed at reducing its debt and improving overall profitability. In a recent announcement, the company disclosed that it has sold its Maple Street Biscuit Company business, along with the assets associated with 35 of its locations, to Biscuit Belly LLC. As part of this strategic shift, Cracker Barrel will close its remaining 16 Maple Street restaurants.
In addition to the divestment of Maple Street, Cracker Barrel finalized a sale-leaseback agreement involving 26 of its company-owned restaurant properties. This transaction is expected to yield approximately million in net proceeds. The chain intends to utilize these funds to pay down its debt while maintaining operational control of the restaurants by leasing back the properties from the new owner.
Julie Masino, President and CEO of Cracker Barrel, stated that these efforts underscore the company’s commitment to prudent business management and enhancing shareholder value. She emphasized that the divestiture of Maple Street allows Cracker Barrel to concentrate more effectively on its core brand, potentially leading to improved profitability.
Biscuit Belly, which currently operates 15 locations, views this acquisition as an opportunity for rapid expansion. The chain plans to transform the newly acquired Maple Street restaurants into Biscuit Belly locations over the next 18 to 24 months. The first conversions are slated to take place in the greater Cincinnati area and Richmond, Virginia. This significant move will more than triple Biscuit Belly’s footprint, setting the stage for growth to over 60 locations by the end of 2028.
Although Maple Street accounted for less than 2% of Cracker Barrel’s annual revenue, the company anticipates that the sale will enhance its adjusted EBITDA beginning in fiscal 2027. However, Cracker Barrel expects to face between million and million in non-cash charges linked to the exit from Maple Street during its fiscal fourth quarter, in addition to estimated cash costs of million to million.
These strategic adjustments occur amid ongoing efforts by Cracker Barrel to recover from a backlash following proposed changes to its branding last summer. The company had faced criticism for plans to modify its logo and restaurant interiors, prompting a swift reversal of those decisions in response to customer feedback.
As Cracker Barrel aims to navigate this transitional phase, industry observers will closely monitor its ability to enhance profitability and regain consumer trust.
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