Olive Garden’s parent reports big sales, profits

Diners couldn’t get enough of Olive Garden as parent company Darden Restaurants Inc. reported big sales and net income increases led by the flagship brand.

Here are some of the results.

5.3

Olive Garden delivered big on the most important metric in the industry, same-restaurant sales.

Olive Garden’s same-restaurant sales increased 5.3 percent compared to a year ago for the three months ending Aug. 26, helping Darden beat Wall Street estimates on sales and net income.

That’s a massive sales spike when the rest of the restaurant industry is seeing modest growth in the 1 percent range.

Olive Garden continues to buoy results for the Orlandobased restaurant company and strong sales growth came in at LongHorn Steakhouse (3.1 percent), Capital Grille (3.9 percent) and Eddie V’s.

“Our competitive advantages continue to work hard for us, allowing us to invest in our people and brands to deliver exceptional guest experiences,” said a statement from CEO Gene Lee.

Olive Garden’s sales growth came from a mix of increased traffic, customers buying more expensive menu items and menu prices going up about 1.9 percent.

$2.06 billion

That’s how much Darden registered in sales at all its restaurant during the last three months. It boosted 1st fiscal quarter sales by 6.5 percent in the first quarter to $2.06 billion and the company recorded net income of $166.2 million, up from $119 million a year ago.

Earnings per share came in at $1.34 for the first quarter, 10 cents above analysts estimates, according to Yahoo Finance.

-$1.44

Darden’s results outperformed analysts’ expectations, but the stock was still down in trading Thursday as traders apparently sold on the positive news. Shares were down $1.44, or about 1.2 percent.

52

Darden Restaurants has built 52 new restaurants in the United States and Canada during the last year as the company is again in growth mode.

Olive Garden added 11 new restaurants and LongHorn grew by 15. Cheddar’s Scratch Kitchen added 16 restaurants as well.

Darden now has 1,752 total restaurants across its seven brands.

52 again

Seasons 52 sales were down 1 percent in the quarter as the upscale restaurant that focuses on healthy eating was once again a sour spot among Darden’s specialty restaurants.

-4

Cheddar’s Scratch Kitchen sales continue to struggle, with same-restaurant sales dropping by 4 percent during the quarter as the chain can’t quite turn things around after being acquired by Darden in April 2017.

Darden also disclosed a data breach at Cheddar’s restaurants just as its last quarter was ending, adding more challenges in the upcoming months to the value-focused restaurant brand.

But Cheddar’s results haven’t seemed to affect the outlook at Darden. The restaurant company increased its sales forecast for the year.