Darden Sales Rise but Higher Costs Dent Profit
Darden
DRI -2.07%
Darden
DRI -2.07%
Restaurants Inc. said sales rose 9.4% in its latest quarter as diners continue to eat out, while profit edged lower as the restaurant company faced soaring costs for food and labor.
The owner of Olive Garden, LongHorn Steakhouse and other sit-down restaurants on Friday also raised its guidance for its current fiscal year.
The Orlando, Fla.-based company posted sales of $2.49 billion in the quarter ended Nov. 27, topping analyst expectations of $2.43 billion, according to FactSet. Same-restaurant sales, which strip out the effects of openings and closings, rose 7.3%, led by Olive Garden and LongHorn, its two largest chains.
Its profit, however, slipped 3% to $187.2 million, as total operating expenses rose 11% from a year ago, with large increases in food and beverage costs, and restaurant labor expenses.
On a per-share basis, the company’s earnings ticked up slightly to $1.52 a share on a smaller base of shares outstanding. Analysts had been expecting $1.44 a share.
Darden and other restaurant operators have been raising menu prices this year to offset ballooning costs. The price of eating out is up 8.5%, according to the latest data from the Labor Department.
Sales at Darden have held up, with the company now projecting sales as high as $10.45 billion this year, slightly higher from a prior forecast. It now expects same-restaurant sales to rise 5% to 6.5%, up from a range of 4% to 6%.
The company also raised the low end of its earnings guidance by 20 cents to $7.60 a share for the year. Total cost inflation is expected to be up 7%, up from 6%.
Shares of Darden, down 5.2% this year through Thursday’s close, rose slightly in premarket trading.
Write to Dean Seal at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Darden
DRI -2.07%
Darden
DRI -2.07%
Restaurants Inc. said sales rose 9.4% in its latest quarter as diners continue to eat out, while profit edged lower as the restaurant company faced soaring costs for food and labor.
The owner of Olive Garden, LongHorn Steakhouse and other sit-down restaurants on Friday also raised its guidance for its current fiscal year.
The Orlando, Fla.-based company posted sales of $2.49 billion in the quarter ended Nov. 27, topping analyst expectations of $2.43 billion, according to FactSet. Same-restaurant sales, which strip out the effects of openings and closings, rose 7.3%, led by Olive Garden and LongHorn, its two largest chains.
Its profit, however, slipped 3% to $187.2 million, as total operating expenses rose 11% from a year ago, with large increases in food and beverage costs, and restaurant labor expenses.
On a per-share basis, the company’s earnings ticked up slightly to $1.52 a share on a smaller base of shares outstanding. Analysts had been expecting $1.44 a share.
Darden and other restaurant operators have been raising menu prices this year to offset ballooning costs. The price of eating out is up 8.5%, according to the latest data from the Labor Department.
Sales at Darden have held up, with the company now projecting sales as high as $10.45 billion this year, slightly higher from a prior forecast. It now expects same-restaurant sales to rise 5% to 6.5%, up from a range of 4% to 6%.
The company also raised the low end of its earnings guidance by 20 cents to $7.60 a share for the year. Total cost inflation is expected to be up 7%, up from 6%.
Shares of Darden, down 5.2% this year through Thursday’s close, rose slightly in premarket trading.
Write to Dean Seal at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Denial of responsibility! Techno Blender is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – [email protected]. The content will be deleted within 24 hours.