Summary
Darden Restaurants, Inc. reported solid sales growth for the third quarter and nine months ended February 26, 2012, driven by an increase in company-owned restaurants and positive same-restaurant sales at key brands like Olive Garden, Red Lobster, and LongHorn Steakhouse. The company successfully integrated the acquired Eddie V's restaurants and continued its expansion strategy with a notable increase in capital expenditures for new and remodeled locations. While net earnings from continuing operations saw a slight decrease for the nine-month period, diluted earnings per share experienced a modest increase, largely due to effective share repurchases reducing the outstanding share count. The company's financial condition remains stable, supported by operating cash flows and a renewed revolving credit facility, providing confidence in its ability to fund ongoing operations, capital investments, and shareholder returns through dividends and share buybacks.
Financial Highlights
51 data points| Revenue | $2.16B |
| Cost of Revenue | $1.63B |
| Gross Profit | $532.40M |
| SG&A Expenses | $198.00M |
| Operating Expenses | $1.94B |
| Operating Income | $164.10M |
| Net Income | $164.10M |
| EPS (Basic) | $1.28 |
| EPS (Diluted) | $1.25 |
| Shares Outstanding (Basic) | 128.00M |
| Shares Outstanding (Diluted) | 130.90M |
Key Highlights
- 1Total sales increased by 9.3% in the third quarter and 7.7% for the first nine months of fiscal 2012, driven by new restaurant openings and same-restaurant sales growth.
- 2Same-restaurant sales increased by 4.1% in the third quarter and 3.0% for the first nine months, with notable strength in LongHorn Steakhouse and Red Lobster.
- 3The company successfully acquired and integrated 11 Eddie V's Prime Seafood and Wildfish Seafood Grille restaurants.
- 4Capital expenditures increased to $483.4 million for the nine months, primarily for new restaurant construction and remodels, reflecting an aggressive growth strategy.
- 5Diluted earnings per share from continuing operations increased by 15.7% in Q3 and 0.4% for the nine months, benefiting from share repurchases which reduced the average diluted shares outstanding.
- 6The company maintained compliance with its new $750 million revolving credit facility, with $391.4 million available as of February 26, 2012, ensuring liquidity.
- 7Dividends paid increased to $168.6 million for the nine months, reflecting a commitment to returning capital to shareholders, alongside significant share repurchases.