Darden Restaurants Earnings Rise, Hit Expectations

Darden Restaurants posted a 12% rise in quarterly earnings, helped by higher prices at its Red Lobster and Olive Garden chains and a larger number of restaurants.

Second-quarter net income was $61.7 million, or 41 cents a share, compared with $55.1 million, or 35 cents a share, a year ago.

Wall Street analysts, on average, had been expecting earnings of 41 cents a share, according to Reuters Estimates.

Sales rose 4.5% to $1.39 billion, helped by higher sales at established Red Lobster and Olive Garden outlets and the addition of more Olive Garden and Smokey Bones restaurants.

Analysts, on average, had been expecting sales of $1.4 billion, according to Reuters Estimates.

Same-store sales, a key measure that tracks sales at restaurants open at least 16 months, rose 2.9% at Olive Garden and climbed 0.7% at Red Lobster.

In November, customer traffic was flat at Olive Garden and fell 2% to 3% at Red Lobster. Guest counts have suffered at many casual restaurants this year because higher prices at gas pumps are eating into consumers' dining out budgets.

On average, customer checks were higher in November due to price increases, Darden said.

Darden said it still expects earnings per share to rise between 10% and 12% this year. Same-store sales are expected to be up between 2% and 4% for Red Lobster and Olive Garden.

Contact U.S. News


    Get the best of CNBC in your inbox

    To learn more about how we use your information,
    please read our Privacy Policy.
    › Learn More

Don't Miss

U.S. Video

  • Qualcomm is reporting EPS beat of $1.34 adjusted on revenue beat of $7.10 billion, with CNBC's Jon Fortt.

  • President Obama has dropped his controversial proposal to tax 529 plans, but as CNBC's Sharon Epperson reports, the ability to withdraw tax-fee funds for higher education isn't the only reason these plans are an attractive vehicle for millions of families to save for college.

  • "The Playboy of Indiana" Timothy Durham dates exotic models, owns 80 sports cars, all bankrolled by a $200 million fraud.