Darden Restaurants is a multi-brand restaurant operator based in Florida. On Friday, the company quarterly revenue missed expectations, as another wave of pandemic-related dining restrictions affected its same-store sales. The parent company of Olive Garden expects sales to decline even further in the next quarter, plunging 30% to 35%.
Interestingly, shares of the company fell more than 1% in premarket trading.
Let’s have a look at the interesting details. As a reminder, the quarter ended on November 29. Importantly, the company reported a fiscal second-quarter net income of $96 million, or 73 cents per share. A year earlier, the company reported $24.7 million, or 20 cents per share.
Importantly, net sales fell 19.4% to $1.66 million, missing expectations of $1.69 million. Notably, same-store sales across all of its brands dropped 20.6% during the quarter. People should take into account that, sales were also impacted by the timing of Thanksgiving, which shifted from its fiscal third quarter to its fiscal second quarter this year.
Darden Restaurants and financial results
Interestingly, Olive Garden the gem of Darden’s portfolio saw its same-store sales declined 19.9%. It is worth noting that, LongHorn Steakhouse, which has seen strong demand for its takeout, reported same-store sales declines of just 11.1%. However, the company’s fine dining business, which includes The Capital Grille suffered the most serious losses. Notably, the segment’s same-store sales plunged 31% in the quarter.
The coronavirus pandemic created a lot of problems for the industry and Darden Restaurants is not an exception. Importantly, roughly a quarter of Darden restaurants closed their dining room by December 13, up from just 8% of its locations in the week ended November 8.
Interestingly, in November and December, Darden’s combined same-store sales declined sequentially as more states decided to impose restrictions on in-person dining. Moreover, weather conditions also affected the situation. After falling just 23.4% in the week ended November 8, the same-store sales dropped 36.9% by the week ended December 13.
People should take into account that, for its fiscal third quarter, Darden is anticipating net earnings per share from continuing operations of 50 cents to 75 cents. The Orlando-based company reiterated its full-year outlook of 35 cents to 40 cents new restaurants. Also, total capital spending of $250 million to $300 million. Interestingly, the company also said it would pay a 37-cent dividend to shareholders on February 1.
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