Restaurant company Darden Restaurants, Inc. (DRI) reported Thursday that profit for the third quarter nearly doubled from last year, which was hurt by significant business interruptions related to COVID-19.
However, earnings per share and quarterly revenues missed analysts’ estimates. The company also raised its revenue guidance for the full-year 2022.
“This was a quarter of stark contrasts and I’m pleased with our performance in this highly volatile environment. It began with record sales in December. However, the Omicron variant significantly impacted guest demand, restaurant staffing and operating expenses in January,” said Chairman and CEO Gene Lee.
For the third quarter, net earnings nearly doubled to $247.0 million or $1.93 per share from $128.7 million or $0.98 per share in the prior-year quarter.
On average, 24 analysts polled by Thomson Reuters expected the company to report earnings of $2.10 per share for the quarter. Analysts’ estimates typically exclude special items.
Total sales for the quarter surged 41.3 percent to $2.45 billion from $1.73 billion in the same quarter last year, driven by a blended same-restaurant sales increase of 38.1 percent and the addition of 33 net new restaurants. Analysts expected revenues of $2.51 billion for the quarter.
Sales at Olive Garden segment increased to $1.14 billion from $872.0 million, with same-restaurant sales growth of 29.9 percent. LongHorn Steakhouse segment sales grew to $612.7 million from $454.3 million, with same-restaurant sales growth of 31.6 percent.
Sales at Fine Dining segment surged to $208.2 million from $103.7 million last year, with same-restaurant sales growth of 85.8 percent.
Darden’s Board of Directors also declared a regular quarterly cash dividend of $1.10 per share on the Company’s outstanding common stock, payable on May 2, 2022 to shareholders of record at the close of business on April 8, 2022.
Looking ahead to fiscal 2022, the company updated its financial outlook, based on year-to-date results and its expected performance for the remainder of the year, subject to no interruptions related to COVID-19.
The company now projects net earnings from continuing operations in a range of $7.30 to $7.45 per share on total sales of between $9.55 billion and $9.62 billion, with same-restaurant sales of 29 to 30 percent. It also expects approximately 35 new restaurant openings.
Previously, the company expected net earnings from continuing operations in the range of $7.25 to $7.60 per share on total sales of between $9.4 billion and $9.6 billion, with same-restaurant sales of 27 to 30 percent.
The Street is currently looking for earnings of $7.50 per share on total sales of $9.61 billion for the year
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