Founding father of XX-XY Athletics Jennifer Sey analyzes why clients rejected the pitch to alter the restaurant chains emblem on The Night Edit.
Cracker Barrel’s management acquired a failing grade in a proxy advisory agency’s pay for efficiency metric final yr earlier than the corporate determined to maneuver ahead on an ill-fated rebranding effort.
A report by proxy advisory agency Glass Lewis in Nov. 2024 forward of a shareholder vote gave Cracker Barrel an “F” grade within the agency’s proprietary metric for the corporate’s 2024 fiscal yr. The struggling restaurant chain additionally acquired “D” grades on Glass Lewis’ pay for efficiency metric in each fiscal years 2022 and 2023.
The report famous a “potentially severe disconnect between pay and performance” as a result of Cracker Barrel’s efficiency relative to its govt pay ranges amongst peer corporations.
Glass Lewis famous that Cracker Barrel’s CEO transition “heavily impacted pay practices for the year in review,” as Julie Felss Masino was named the corporate’s new CEO in August 2023, simply after the start of Cracker Barrel’s fiscal yr 2024.
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Cracker Barrel reversed its deliberate rebrand and restored its basic emblem amid backlash. (Joe Raedle/Getty Photographs / Getty Photographs)
The proxy agency defined that whereas Cracker Barrel shareholders must be “wary of the worsening level of disconnect between pay and performance” within the previous yr, it acknowledged that the weighted common of three years of common compensation was “significantly impacted” by the CEO transition in addition to one-off awards within the prior yr.
When thought-about by itself, Masino’s whole goal compensation was “reasonably positioned below the median” of Cracker Barrel friends in Glass Lewis’ evaluation.
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The proxy agency additionally mentioned Cracker Barrel introduced in Could 2024 that it could spend between $600 to $700 million on capital expenditures via fiscal yr 2027, when it had initiated pilot testing for its transform at two restaurant places.
That transfer, together with an 80% dividend lower and slower visitors than anticipated in FY2024 “introduced significant uncertainty” and contributed to a 14.5% single-day decline in Cracker Barrel’s inventory worth following the announcement.
FOX Enterprise reached out to Cracker Barrel for touch upon the report.
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Final month, Cracker Barrel’s transformation mission turned to a revamp of its basic emblem, eradicating the “old timer” sitting subsequent to a barrel and revising the Cracker Barrel script, a transfer which prompted fierce backlash from followers and spooked buyers, leading to a inventory slide.
The rebrand, which was introduced on August 19, was reversed earlier than the top of the month, with Cracker Barrel asserting on August 27 that it could restore the unique emblem.
Cracker Barrel’s inventory rallied again to close its August excessive of $62.55 a share following the reversal, although it has since declined this week again to close its mid-controversy lows of about $54.
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Regardless of the latest volatility, Cracker Barrel’s inventory is down about 1.7% yr so far – although it is up 35% within the final six months and 39% over the previous yr amid its transformation push.
