A sign posted in front of Olive Garden Restaurant on June 22, 2023 in Chicago, Illinois.
Scott Olsen Getty Images
Darden Restaurants The Olive Garden owner reported mixed quarterly results Thursday as same-store sales declined for the first time since the pandemic.
The company’s shares fell more than 5% in premarket trading.
Below is a comparison of the company’s report and Wall Street’s expectations, based on an analyst survey by LSEG (formerly Refinitiv).
- Earnings per share: Adjusted $2.62, in line with expectations
- Revenue: $2.97 billion vs. $3.03 billion expected
Darden reported third-quarter net income of $312.9 million, or $2.60 per share, up from $286.6 million, or $2.34 per share, in the year-ago period.
Excluding merchandise, the restaurant company earned $2.62 per share.
net sales Sales rose 6.8% to $2.97 billion, helped by Darden’s acquisition of Ruth’s Chris Steak House and 53 other new restaurants.
However, Darden’s overall same-store sales fell 1% for the quarter, as nearly all of its restaurant segments reported declines in same-store sales. Only Longhorn Steakhouse increased same-store sales.
Olive Garden, typically the crown jewel of Mr. Darden’s portfolio, reported a 1.8% decline in same-store sales. Analysts had expected the chain’s same-store sales to rise 1.3%, according to estimates from Street Account.
Longhorn Steakhouse’s same-store sales increased 2.3%, but still fell short of Street Account estimates of 3.1%.
Darden’s fine dining business, which includes The Capital Grille, saw same-store sales decline 2.3%. The segment currently includes Ruth’s Chris, but those same-store results will not be included in the category total for several more quarters.
The remaining chains, including Cheddar’s Scratch Kitchen, saw a combined same-store sales decline of 2.6%.
Darden also updated its outlook for fiscal 2024. The company now expects adjusted earnings per share to be in the range of $8.80 to $8.90, narrowing its earnings guidance range from the previous range of $8.75 to $8.90. Darden also lowered its revenue outlook from $11.5 billion to $11.4 billion and revised its same-store sales outlook from a 2.5% to 3% growth rate to a 1.5% to 2% range.
