Darden Restaurants Takes a Bite Out of Earnings
When Darden Restaurants Inc. (NYSE: DRI) released its fiscal third-quarter financial results before the markets opened on Thursday, the company posted $1.80 in earnings per share (EPS) and $2.25 billion in revenue. That compares with consensus estimates of $1.75 in EPS and $2.24 billion in revenue, as well as the $1.71 per share and $2.1 billion reported in the same period of last year.
During the quarter, total sales increased 5.5% year over year, driven by the addition of 39 net new restaurants and a blended same-restaurant sales increase of 2.8%. In terms of its brands, Darden reported same-restaurant sales growth as follows:
- Olive Garden, +4.3%
- Cheddar’s Scratch Kitchen, −2.7%
- LongHorn Steakhouse, +3.8%
- Yard House, −2.1%
- The Capital Grille, +4.3%
- Seasons 52, −1.3%
- Eddie V’s, +3.7%
- Bahama Breeze, −3.7%
Looking to the fiscal 2019 full year, the company expects to see EPS in the range of $5.76 to $5.80 and total sales growth of roughly 5.5%. Consensus estimates call for $5.70 in EPS and $8.52 billion in revenue for the year.
Darden’s board of directors declared a regular quarterly cash dividend of $0.75 per share on outstanding common stock. The dividend is payable on May 1, 2019, to shareholders of record at the close of business on April 10.
CEO Gene Lee commented:
Our strong top-line results exceeded the industry this quarter resulting in significant market share gains. This sales performance, coupled with strong operating profit growth, is a testament to our strategy and the outstanding focus and execution by our restaurant teams who create exceptional dining experiences for our guests every day.
Shares of Darden were last seen up about 6% at $115.66, with a 52-week range of $82.38 to $124.00. The stock has a consensus analyst price target of $121.23.