Darden Restaurants Profit Up as Customer Traffic Rises
Darden Restaurants reported a 20% rise in quarterly net earnings, helped by higher prices and increased customer traffic at its Red Lobster and Olive Garden restaurants. Shares of Darden traded up 1.5% in post market trading after finishing the regular session up 3.5% at $43.84.
Darden , which is in the process of buying LongHorn Steakhouse parent Rare Hospitality
Earnings from continuing operations were 73 cents a share. On that basis, Wall Street analysts, on average, had been expecting earnings of 70 cents per share, according to Reuters Estimates.
Sales rose 7.9% to $1.47 billion. Analysts had been expecting sales of about $1.45 billion, according to Reuters Estimates.
Same-store sales, a key retail measure that tracks sales at restaurants open at least 16 months, rose 4.8% at Olive Garden and 7% at Red Lobster.
Beginning in the second quarter, Darden said it would stop reporting monthly same-store sales results.
Last month, Darden said it would buy Rare Hospitality for about $1.2 billion plus debt. The deal will bring steakhouse chains LongHorn Steakhouse and Capital Grille into Darden's portfolio, which also includes smaller chains Bahama Breeze and Seasons 52.
The move followed the closure and sale of Darden's poorly performing Smokey Bones barbecue restaurants earlier this year.