Darden Restaurants $DRI+0.3% on Thursday reported a quarterly profit that beat Wall Street expectations, thanks to strong sales at its LongHorn Steakhouse restaurant.
The company also announced that former CEO Gene Lee plans to step down as chairman of the board. Lee retired more than a year ago from his position as CEO. He will not be running again at the company's annual shareholder meeting, which is scheduled for Sept. 20.
"I am proud of what we have accomplished and believe Darden Restaurants is well positioned for continued growth and prosperity in the years ahead," Lee said in a statement.
The company's shares were down more than 3% in pre-market trading.
Here's a comparison of what the company announced with what Wall Street expected based on a survey of analysts by Refinitiv:
Earnings per share: $2.58 vs. $2.54 expected
Revenue: $2.77 billion, which met expectations
Darden reported fiscal fourth-quarter net income of $315.1 million, or $2.58 per share, up from $281.7 million, or $2.24 per share, a year earlier.
Net sales rose 6.4% to $2.77 billion.
The company's same-store sales rose 4%, helped by strong results at its LongHorn Steakhouse restaurant. The steakhouse chain reported same-store sales growth of 7.1%, beating StreetAccount estimates of 4.9%.
However, Olive Garden, which accounts for about 45% of Darden's sales, posted weaker-than-expected results for the quarter. The Italian chain's same-store sales rose 4.4%, falling short of expectations for 5% growth.
Darden's fine dining segment reported a 1.9% decline in same-store sales. This division includes The Capital Grille and Eddie V's restaurants.
In the next quarter, the company's fine dining segment will also include Ruth's Chris Steak House, which the company bought for $715 million. Darden's results for the quarter ended May 28 do not include its latest addition, as the company completed the acquisition on June 14.
Through fiscal 2024, Darden projects net sales of $11.5 billion to $11.6 billion, same-store sales growth of 2.5% to 3.5% and adjusted earnings per share from continuing operations of $8.55 to $8.85.
Its earnings outlook excludes approximately 34 cents per share of after-tax costs related to the integration of Ruth's Chris Steak House. The remainder of the forecast for fiscal 2024 includes the operating results of Ruth's Chris Steak House.
The restaurant company also projects capital expenditures of $550 million to $600 million and general inflation of 3% to 4%.
Wow, I've never heard of them either, it looks like a nice company in hindsight, starting in 2020 so it has nice growth. Too bad, catch it, it would have been awesome, now the price is pretty high, or are you expecting another ATH? 😊
How come I've never heard of them?