Darden Restaurants Inc. reported a 19-percent increase in net earnings for the fourth quarter Thursday and projected that fiscal 2012 would be “somewhat stronger," than 2011 as the economy continued to recover gradually.
For the fourth quarter ended May 29, the parent of such casual-dining chains as Olive Garden, Red Lobster and LongHorn Steakhouse chains generated net earnings of $138 million, or $1 per diluted share, compared with $116 million, or 81 cents per diluted share, for the year-ago period.
Sales rose 7 percent to $1.99 billion for the quarter.
U.S. same-restaurant sales rose 6 percent for LongHorn Steakhouse and 3.8 percent at Red Lobster in the quarter, while Olive Garden was flat.
“Our strong fourth quarter completes a very successful year for Darden,” Clarence Otis, Darden’s chief executive, said in a statement. “It is success that’s grounded in talented teams in our restaurants and restaurant support center who work diligently every day to deliver on our promises to guests and shareholders alike.
“These teams have built a powerful portfolio of brands whose sales are growing at a rate much faster than our industry — extending our already significant market share leadership position,” he said.
Otis said the company expects fiscal 2012 will be “somewhat stronger but in many ways much like 2011, with continued — albeit frustratingly slow — recovery in the economy and in our industry.”
Chain results:
• Olive Garden: Fourth-quarter sales increased 3.9 percent to $881 million over last year, thanks to revenue from 31 net new restaurants. Total fiscal year sales were up 5.2 percent from a year ago. Average annual sales per restaurant were $4.8 million, and U.S. same-store sales increased 1.2 percent for the year.
• Red Lobster: Fourth quarter sales rose 5.6 percent to $701 million driven by the chain’s U.S. same-restaurant sales increase of 3.8 percent and revenue from four net new restaurants. Total fiscal year sales were $2.52 billion, a 1.3-percent increase compared to the same period last year. Average annual sales per restaurant were $3.6 million and U.S. same-restaurant sales increased 0.3 percent for the fiscal year.
• LongHorn Steakhouse: Fourth quarter sales rose 14.1 percent to $266 million over the year-ago period, driven by revenue from 23 net new restaurants and a U.S. same-restaurant sales increase of 6 percent. Total fiscal year sales were $984 million, an 11.6-percent improvement from last year. Average annual sales per restaurant were $2.9 million and U.S. same-restaurant sales increased 5.4 percent for the fiscal year.
• The Specialty Group: The Capital Grille, Bahama Breeze and Seasons 52 together generated fourth quarter sales of $141 million, a 19.3-percent rise over the same quarter in 2010. Sales were driven by same-restaurant sales increases of 7.9 percent at The Capital Grille, 2 percent at Bahama Breeze and 2.2 percent at Seasons 52. Sales growth also reflected revenue from four new restaurants at The Capital Grille, one new restaurant at Bahama Breeze and six new restaurants at Seasons 52.
The Capital Grille’s average annual sales per restaurant were $6.5 million, and same-restaurant sales increased 6.2 percent for the fiscal year. Bahama Breeze’s average annual sales per restaurant were $5.5 million, and same-restaurant sales increased 2.4 percent for the fiscal year. At Seasons 52 average annual sales per restaurant were $6.3 million and same-restaurant sales increased 4.4 percent for the fiscal year.
Darden’s net earnings for fiscal year 2011 increased 17.6 percent to $478.7 million on sales of $7.5 billion, compared with $407 million on sales of $7.1 billion in the previous year.
For fiscal 2011, earnings per share were $3.41, a 19-percent increase from $2.86 last year.
Orlando, Fla.-based Darden operated 1,894 restaurants at the end of the fourth quarter, May 29.
Contact Alan Snel at [email protected].
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