Good day, everyone, and welcome to today's program. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. Please note this call may be recorded. I will be standing by should you need any assistance. It is now my pleasure to turn the conference over to Ms. Jessica Hazel. You may begin, ma'am.

Thank you, Steve. Good morning and welcome to Cracker Barrel's second quarter fiscal 2015 conference call and webcast. This morning we issued a press release announcing our second quarter results and our updated guidance for the 2015 fiscal year. In this press release and on this call, we will refer to non-GAAP financial measures for the current quarter, adjusted to exclude a contingent liability accrual related to the previously disclosed Fair Labor Standards Act Litigation and a provision for taxes to exclude the prior year favorable impact of the retroactive reinstatement of the work opportunity tax credit. We will also refer to non-GAAP financial measures for the prior fiscal year adjusted to exclude charges and tax effects related to proxy contest expenses. The company believes that excluding these charges and tax effects from its financial results provides information that may be more indicative of the company's ongoing operating performance, while improving comparability to prior periods. This information is not intended to be considered in isolation or as a substitute for financial information prepared in accordance with GAAP. The last page of the press release includes a reconciliation from the non-GAAP information to the GAAP financials. The press release can be found in the Investors section of our website, crackerbarrel.com. In that press release and during this call, statements may be made by management of their beliefs and expectations of the company's future operating results and expected future events. These are what are known as forward-looking statements, which involve risks and uncertainties, and in many cases are beyond management's control and may cause actual results to differ materially from expectations. We urge caution to our listeners and readers in considering forward-looking statements and information. Many of the factors that could affect results are summarized in the cautionary description of risks and…

Good morning, everyone, and thank you, Sandy. I would like to begin by discussing our financial performance for the second quarter of fiscal 2015, and then our outlook for the 2015 fiscal year. For the second quarter of fiscal 2015, we reported GAAP net income of $47.2 million or $1.96 per diluted share, and adjusted net income of $46.3 million or $1.93 per diluted share, compared with adjusted net income of $37.3 million or $1.56 per diluted share in the prior year quarter. In the prior year quarter, GAAP net income was adjusted for the expenses and tax effects related to the prior year proxy contest. In the current year quarter, we made two adjustments to GAAP net income. First, during the second quarter, we accrued an additional $2.2 million to reflect the contingent liability associated with the previously disclosed Fair Labor Standards Act litigation. Second, in December, the federal government retroactively reinstated the Work Opportunity Tax Credit or WOTC for the period of January 1 to December 31 of 2014. It expired again at the end of the 2014 calendar year. While the full benefit of the WOTC reinstatement on our second quarter GAAP earnings was $0.13 per diluted share, the $0.10 per diluted share that relates to the prior fiscal year is excluded from our adjusted EPS. Our revenue in the quarter was $756 million, an 8.2% increase over the $698.5 million in the prior year second quarter. Our restaurant revenues were $577.6 million and retail revenues were $178.4 million. Our comparable store restaurant sales increased 7.9% as traffic increased 4.7%, and average check increased 3.2%. The increase in average check reflects menu price increases of approximately 2.5% and a 70 basis point favorable mix impact from our seasonal menu promotions. Our comparable store retail sales increased 3.2%…

Our first question is from Joseph Buckley from Bank of America. Your line is open.

Thank you. A couple of questions. Sales numbers looked absolutely terrific as did earnings, of course. But a question on the to-go sales, you mentioned that being up I think 20% year-over-year. And I'm curious if you did anything to promote or highlight that to drive that kind of an increase? And maybe if you could share what your to-go mix is as a percent of restaurant sales that would be helpful too. Sandra B. Cochran - President, Chief Executive Officer & Director: Well, good morning, Joe. I'm going to let Chris Ciavarra take that question.

Good morning, Joe. It's an important day for us, obviously. And over the past few years, we've continued to put more and more focus on it. So, certainly within the store, we have a fair amount of merchandising leading up to the day whether that's through in-store tactics. And then we've become more aggressive outside of the store in the digital channels being able to communicate that. We have these offers available for us. I'll let Larry speak to the percentage of sales.

Chris, maybe you've answered my question in part already, although I would like to hear what Larry has to say. But so is that Thanksgiving Day only, or was that to-go number for the quarter? Sandra B. Cochran - President, Chief Executive Officer & Director: That's for the whole quarter, Joe.

For the whole quarter.

Okay. So, then my question stands.

Our percentage of to-go sales has historically run in the 5% to 6% range, Joe, I believe, but I would be happy to confirm this that in the third quarter, it got us high in the range of – I'm sorry – and I would just point it out, we are not in the third quarter yet, but in the second quarter it got in the range of 7%.

Okay. And then, just a question on retail. The cadence of same-store sales in the quarter with the big January increase, like if you didn't report a retail gross margin number, I would've thought that was a lot of merchandise moving out of low margin. Obviously, the retail margin was terrific. So just talk a little bit more about that like how you view the sales number for the quarter on retail, and I think prior to this, kind of the strategy was to take markdowns early, if I'm not mistaken, and it seems like you definitely got off that and kind of pushed whatever markdowns were taken into January. But, again, the monthly sales cadence is sort of surprising, I guess. Sandra B. Cochran - President, Chief Executive Officer & Director: Well, first of all, let me say I'm very, very proud of the job that the retail team was able to do in the second quarter managing sales margin and inventory in a very uncertain and promotional retail environment. So if you recall last year, the environment was even more difficult with the weather and the government shutdown and the initial implementation of the ACA. And as a result, we like many retailers got very aggressive, very early in the season and so we took markdowns in November and December. This year the team focused on having the appropriate inventory levels in the appropriate places and trying to manage the sales to maximize margin, particularly during the very high volume November and December period. So, what you saw is a moderated promotional agenda during that period. But then when we hit January, our inventories were in a good position. We were comping sort of easier numbers on the prior year, and we took advantage of our traffic in January, which was very high. But as a result for the overall holiday season, they were able to deliver, I think very good sales, increased margins percentage and dollars reduced inventories against the backdrop that was very challenging in the retail industry. There were number of areas that were strong for us. I pointed out a couple in my remarks. The women's apparel was good. Our Christmas décor was very strong this year and we exceeded our expectations on our Christmas theme. And our great gifts were, as I mentioned, were strong. We had a plush assortment that was very popular with our guests. We had a keyboard in that theme that we actually had highlighted in Analyst Day, and that sold out almost one of the first items. So, we just had a lot of things that they managed quite well through the season.

Okay. Thank you.

Our next question is from Jeff Farmer from Wells Fargo. Your line is open.

Thank you. Larry, you touched on it, but you saw 80 basis points of COGS pressure in Q1. I think something closer to a 10 basis point benefit in Q2, and it sounds like you're pointing to a peak level of inflation in Q3. So given sort of all that volatility there, how should we be thinking about COGS as a percent of revenue in Q3 and even into Q4?

Yeah. Jeff, looking at Q3, we are anticipating with peak commodity cost increases on the food side that we will continue to see sequentially and year-over-year increases in our restaurant COGS. We expect our retail COGS to be flat to slightly down for the third quarter as compared to the prior year third quarter.

All right. That's helpful. Thank you very much. And then I think you said that gift card sales were up 15% in Q2. So assuming some of those consumers were able to turn around and use them pretty quickly in January, did you see gift card redemption have an impact on your January same-store sales number?

We believe that we did. The January gift card redemptions as compared to the prior year January were approximately $5 million higher, Jeff.

Okay. And then can you do the math for me, what does that equate to roughly in terms of comparable sales?

In terms of comparable restaurant sales, $5 million on what – it was probably in the range of 1% to 2%.

Okay. That's very helpful. And then last one, look, just in terms of seeing how the same-store sales have moved around some nice profit flow through, especially in the January quarter, is there any sort of updated rule of thumb you have in terms of EPS sensitivity to point of same-store sales growth? It doesn't have to be that, but any sort of rule of thumb we should think about as you continue to either hold onto some nice same-store sales or potentially see them slow down a little bit but still be pretty robust?

Yeah. Jeff, that's a tough question to answer, because it typically depends upon how we drive those incremental sales dollars. One of the rules of thumb that we have used and that we've said publicly is that an incremental sales dollar will on average – contribute in the range of $0.35 to $0.40 to our operating income. Now, the sensitivities is that that margin tends to be higher if it comes from incremental pricing than if it comes from traffic. It tends to be sensitive to the day of the week, the time of the day, it tends to be sensitive to what's happening at that time in terms of the labor markets and commodity markets obviously. But the basic rule of thumb that we use internally and have spoken about externally is the range of $0.35 to $0.40 on a purely incremental dollar.

Great. Thank you, Larry.

Our next question is from Robert Derrington from Wunderlich. Your line is open.

Yeah. Thank you. Larry, I'm trying to understand your guidance for a second as we look out for the fiscal year. Your fiscal year guidance for restaurant same-store sales of 3.5% to 4.5%, on a two-year basis that kind of implies that the second half of the year is about a 400 basis point slowdown. So I'm trying to understand whether that's conservatism on the company's part or whether there's something in your outlook that you see that makes you a lot more cautious in your expectation as we go through the balance of the year.

Yeah, Bob, the second quarter guidance does contemplate a deceleration of same-store sales increases as compared to our performance in the first and the second quarters. Again, particularly our same-store sales performance in the second quarter was driven by comping severe weather in the prior-year second quarter. Gasoline prices, which bottomed out in the second quarter at cyclical lows and although they are down on a year-over-year basis have begun to rebound also off those cyclical lows. Additionally, the weather of the last one-and-a-half to two weeks, particularly in the southeastern United States and in the Midwest has had a meaningful impact on our February sales. And the concern is, as we've seen a lot of school districts that have been closed for five days, six days, now going on seven days, in the core southeastern region, we are having some concerns that that may have a negative impact on the scheduling of spring breaks, which is an important travel season for Cracker Barrel. So I don't know I would necessarily say that the guidance reflects conservatism; I'd say it reflects caution.

Got you. Thanks, Larry, for that color. I don't think there's ever been a time that more of us need a spring break. But anyway, looking at your COGS outlook, your food inflation to guidance has been tightened up from – the annual guidance was 4% to 4.5%, now it's 3.5% to 4%. What's changed within the commodity profile, if I understand it correctly?

COGS guidance has gone from a range of 4% to 5% to a range of 4% to 4.5%, so that we've tightened it up at the top end, Bob. And the reason, if I basically had to say it in a single word, it's pigs.

Terrific. That's very simplistic. And then one last one, if I could. As we look at the development that the company has considered of another concept fast casual brand, Sandy, any kind of color you can provide on where that process is at this point? Sandra B. Cochran - President, Chief Executive Officer & Director: Well, it's a little too early to discuss any detail still. But we continue to believe that we have a very strong brand and an opportunity to reach some trade areas that we're currently not able to serve with our footprint and size of the traditional Cracker Barrel Old Country Store. So we intend for this new concept to have a clear affiliation with the brand and to be a fast casual format. We plan to have the first one open by the end of fiscal 2016 and more to come.

Great. Thank you. I appreciate it.

Our next question is from Michael Gallo from C.L. King. Your line is open. Michael W. Gallo - C.L. King & Associates, Inc.: Hi. Good morning. Sandra B. Cochran - President, Chief Executive Officer & Director: Good morning.

Hello, Michael. Michael W. Gallo - C.L. King & Associates, Inc.: Hello. A couple of questions that we didn't touch on. Can you talk about the opportunity that you might have on the new prototype in terms of a potential retrofit when you might put some in test and how we should think about that going forward? Sandra B. Cochran - President, Chief Executive Officer & Director: We have a number of potential projects that have been identified as part of the design work on the new prototype as possibilities for retrofit. And we are in the process of fleshing out how big the opportunities are, prioritizing them, and we'll be moving certain ones of those into test in existing stores as early as the second half of this year and into the next fiscal year. It's too early to identify any of them specifically. I can tell you some of the projects that we talked about like the dining-room management program, it was a piece of the work we did on the new prototype. And so I am optimistic that we will be able to identify some retrofit opportunities going forward, which will help drive improved efficiency in our current boxes. Michael W. Gallo - C.L. King & Associates, Inc.: Okay. Great. And then I had a follow-up question on the advertising. I think you had one extra week of TV advertising this quarter. Was that in January, or where did that fall versus last year?

Hey, Michael. It's Chris. I believe that fell in November. Michael W. Gallo - C.L. King & Associates, Inc.: Okay.

It was Michael W. Gallo - C.L. King & Associates, Inc.: Okay. So January was the same number only year-on-year?

Yeah. The schedule fell in November and December. Michael W. Gallo - C.L. King & Associates, Inc.: Okay. And then in terms of just the TV advertising going forward, do you expect any other mismatches? Do you expect to have more weeks through second half of the year, or do you expect it to be level versus last year?

So I think as we've talked about in the Analyst Day, we are slowly working ourselves up to a higher level of spend and are testing our ways through this. So, as we move through it, we are contemplating adjustments as we've done this past summer and then again this holiday to both weeks and flighting and things like that. So, as we move into the second half of this year – for this year, we're at least contemplating the same number of weeks, but it will be flighted differently, much like we did this past holiday. Michael W. Gallo - C.L. King & Associates, Inc.: Okay. Thanks a lot.

Our next question is from Michael Halen from Bloomberg. Your line is open.

Hi. Thanks for taking my questions. What percentage of total sales do you think you can grow carryout to in the next few years, and what kind of impact might that have on restaurant level margins?

Yeah. Michael, we've not spoken publicly about long-term goals for to-go sales. To-go sales tend to be at a slightly lower margin as a result of the cost of the incremental packaging.

Great. Thanks. And one more if you don't mind. You mentioned in your prepared comments that you are happy with the new site selection process. Is there any updated sales data on the newer stores that you can share with us?

In terms of specific sales data on the stores, no. But the thing that we can say is the performance of the stores is far more consistent with the projections of our site selection model than was the case with our old methodology. We showed some of that at our Analyst and Investor Day Meeting on May 1. That presentation is still available on our Investor Relations webpage, and our experience with the model continues to be consistent with that result.

Great. Thank you very much.

And next we'll have a follow-up question from Robert Derrington from Wunderlich. Your line is now open.

Yeah. Thank you. Larry, a couple of things. One, could you refresh us for a second on your new credit facility, what's the additional borrowing capacity that you have available were you want to draw on that?

Sure, Bob. We have previously had a facility that was originally a $750 million facility, which was comprised of a revolving line of credit of $500 million and a $250 million amortizing term loan, which at the time of the refinancing had a balance of about $185 million. The facility that we now have is an all-revolver $750 million facility so that there is no amortization. We currently have about $400 million drawn, have utilized about another $25 million for letters of credit associated with our workers' compensation self-insurance, so that means that we currently have capacity under this facility of $325 million. In the event that the board thought it was in the company's interest to borrow further, given that we currently have a leverage ratio, which is in the 1.3% to 1.4% range, the company believes that our borrowing capacity is in excess of the capacity of the current facilities.

Terrific. And then you got a nice problem year-over-year, Sandy, looking at the amount of cash that you have on hand. Last year at this point, the balance sheet shows there was $91.5 million. Currently I think Larry said it was $182.6 million. Can you give us a perspective on what the plan is for that?

Yeah. Bob, a couple of observations there. The first observation is that the end of the second quarter has a tendency to be the cyclical high and the company's cash balances as we come off of the holiday selling season, that's particularly so given the company's recent performance. And as far as possible uses of that cash as this company has said, we believe it's in the long-term interest of the shareholders to gradually increase our regular quarterly dividend over time, although obviously any specific decisions on that are decisions of the board.

Got it. Just curious on that point because last year at the same time, it was also the cyclical high, and it was, again, $91.5 million at the time, and literally you are twice that. So congrats on the quarter. Thank you. Sandra B. Cochran - President, Chief Executive Officer & Director: Thank you, Bob.

Thank you, Bob.

And at this time, we have no further questions. And I'll turn the call back over to our speakers for closing remarks. Sandra B. Cochran - President, Chief Executive Officer & Director: Well, thank you for joining us today. We are pleased with our financial performance for the first half of fiscal 2015. And we've made significant progress on our business priorities. I remain confident that we have the right strategy and the right leadership in place to move the brand forward and drive shareholder value. We appreciate your interest and support. Thank you.