Darden closes strong fiscal year on the back of LongHorn, upscale restaurant performance

Source link

Fourth Quarter and Full-Year Financial Results

Darden Restaurants, Inc. concluded its fiscal year with notable gains, supported by robust performances from LongHorn Steakhouse and its fine dining establishments. The company reported a 6.8% increase in total sales for the fourth quarter, reaching $2.96 billion, compared to $2.77 billion in the same period last year.

Net earnings for the quarter amounted to $308.1 million, or $2.57 per share, up from $315.1 million, or $2.58 per share, in the previous year. Adjusted earnings per share stood at $2.65, exceeding analysts’ forecasts of $2.61, according to Refinitiv data.

Brand Performance Highlights

LongHorn Steakhouse posted a 4% rise in same-restaurant sales, outperforming Olive Garden, which saw a 1% increase. Darden’s fine dining segment, which includes The Capital Grille and Eddie V’s, recorded a 4.5% growth in same-restaurant sales. The company attributed these results to effective pricing strategies and increased guest traffic.

Outlook and Guidance

For the upcoming fiscal year, Darden projects total sales between $11.8 billion and $11.9 billion. The company expects adjusted earnings per share to range from $9.40 to $9.60, in line with Wall Street’s expectations.

Strategic Initiatives and Expansion

Darden continues to focus on expanding its portfolio and enhancing operational efficiency. The company opened 35 new restaurants during the fiscal year and plans to add 45 to 50 new locations in the next year. CEO Rick Cardenas stated, “Our results demonstrate the strength of our brands and the effectiveness of our strategy.”

Dividend and Shareholder Returns

The board of directors approved a quarterly cash dividend of $1.40 per share, payable on August 1 to shareholders of record as of July 10. Darden also repurchased $200 million of its own shares during the fourth quarter.

Market Reaction

Following the earnings announcement, Darden’s shares rose 2% in premarket trading. The company’s stock has gained approximately 12% year to date.