ORLANDO,
Fla., June 20, 2024 /PRNewswire/ -- Darden
Restaurants, Inc. (NYSE:DRI) today reported its financial results
for the fourth quarter and fiscal year ended May 26, 2024.
Fourth Quarter 2024 Financial Highlights
- Total sales increased 6.8% to $3.0
billion driven by sales from the addition of 80
company-owned Ruth's Chris Steak House (Ruth's Chris) restaurants
and 37 other net new restaurants
- Same-restaurant sales:
|
|
|
|
|
|
Consolidated
Darden*
|
0.0 %
|
|
|
|
|
|
|
Olive Garden
|
(1.5) %
|
|
|
|
|
|
|
LongHorn
Steakhouse
|
4.0 %
|
|
|
|
|
|
|
Fine Dining*
|
(2.6) %
|
|
|
|
|
|
|
Other
Business
|
(1.1) %
|
- Reported diluted net earnings per share from continuing
operations were $2.58
- Excluding $0.07 of Ruth's Chris
transaction and integration related costs, adjusted diluted net
earnings per share from continuing operations were $2.65, an increase of 2.7%**
- The Company repurchased $97.3
million of its outstanding common stock
Fiscal 2024 Financial Highlights
- Total sales increased 8.6% to $11.4
billion driven by a blended same-restaurant sales* increase
of 1.6% and sales from the addition of 80 company-owned Ruth's
Chris restaurants and 37 other net new restaurants
- Same-restaurant sales:
|
|
|
|
|
|
Consolidated
Darden*
|
1.6 %
|
|
|
|
|
|
|
Olive Garden
|
1.6 %
|
|
|
|
|
|
|
LongHorn
Steakhouse
|
4.7 %
|
|
|
|
|
|
|
Fine Dining*
|
(2.4) %
|
|
|
|
|
|
|
Other
Business
|
(0.7) %
|
- Reported diluted net earnings per share from continuing
operations were $8.53
- Excluding $0.35 of Ruth's Chris
transaction and integration related costs, adjusted diluted net
earnings per share from continuing operations were $8.88, an increase of 11.0%**
* Will not include Ruth's Chris Steak House until
they have been owned and operated by Darden for a 16-month period
(Q2 Fiscal 2025)
** See the "Non-GAAP
Information" below for more details
"We had a strong year by staying disciplined, being brilliant
with the basics, and controlling what we could control," said
Darden President & CEO
Rick Cardenas. "This enabled us to
exceed the high end of the EPS range we provided at the beginning
of the fiscal year despite weakening conditions that emerged in the
back half of the year."
Segment Performance
Segment profit represents sales,
less costs for food and beverage, restaurant labor, restaurant
expenses and marketing expenses. Segment profit excludes non-cash
real estate related expenses. From the date of acquisition forward,
sales and profits from Ruth's Chris company-owned restaurants are
included within the Fine Dining segment. Royalties from Ruth's
Chris franchise and managed locations are in the Other Business
segment.
|
|
Q4
Sales
|
|
Q4 Segment
Profit
|
($ in
millions)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
Consolidated
Darden
|
|
$2,957.3
|
|
$2,769.0
|
|
|
|
|
Olive Garden
|
|
$1,277.5
|
|
$1,269.2
|
|
$290.7
|
|
$297.8
|
LongHorn
Steakhouse
|
|
$762.7
|
|
$711.7
|
|
$145.3
|
|
$132.1
|
Fine Dining
|
|
$327.1
|
|
$209.8
|
|
$63.3
|
|
$38.3
|
Other
Business
|
|
$590.0
|
|
$578.3
|
|
$102.5
|
|
$91.5
|
|
|
|
Annual
Sales
|
|
Annual Segment
Profit
|
($ in
millions)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
Consolidated
Darden
|
|
$11,390.0
|
|
$10,487.8
|
|
|
|
|
Olive Garden
|
|
$5,067.0
|
|
$4,877.8
|
|
$1,110.2
|
|
$1,025.8
|
LongHorn
Steakhouse
|
|
$2,806.2
|
|
$2,612.3
|
|
$511.1
|
|
$430.9
|
Fine Dining
|
|
$1,291.5
|
|
$830.8
|
|
$241.0
|
|
$158.5
|
Other
Business
|
|
$2,225.3
|
|
$2,166.9
|
|
$337.0
|
|
$300.6
|
Dividend Declared
Darden's Board of Directors declared
a quarterly cash dividend of $1.40 per share on the
Company's outstanding common stock, a 6.9% increase from third
quarter fiscal 2024. The dividend is payable on August 1,
2024 to shareholders of record at the close of business
on July 10, 2024.
Share Repurchase Program
During the quarter, the
Company repurchased approximately 0.6 million shares of its common
stock for a total of approximately $97.3
million. As of the end of the fiscal fourth quarter, the
Company had approximately $915
million remaining under the current $1 billion repurchase authorization.
Fiscal 2025 Financial Outlook
Below is the full year
financial outlook for fiscal 2025. We will provide additional
details during our investor conference call scheduled for this
morning at 8:30 am ET.
- Total sales of $11.8 to
$11.9 billion
- Same-restaurant sales* growth of 1.0% to 2.0%
- New restaurant openings of 45 to 50
- Total capital spending of $550 to
$600 million
- Total inflation of approximately 3.0%
- An effective tax rate of approximately 13%
- Diluted net earnings per share from continuing operations of
$9.40 to $9.60
- Approximately 119 million weighted average diluted shares
outstanding
* Excludes Ruth's Chris Steak House as they will
not be owned and operated by Darden for a 16-month period at the
beginning of Fiscal 2025
Annual Meeting of Shareholders
Darden will hold its
Annual Meeting of Shareholders on September 18, 2024. The
meeting will be held in a virtual format only. The record date for
shareholders to vote in the Annual Meeting is July 24,
2024.
Investor Conference Call
The Company will host a
conference call and slide presentation on Thursday,
June 20, 2024 at 8:30 am ET
to review its recent financial performance. To listen to the call
live, please go
to https://event.choruscall.com/mediaframe/webcast.html?webcastid=haKaMeza
at least fifteen minutes early to register, download, and install
any necessary audio software. Prior to the call, a slide
presentation will be posted on the Investor Relations section of
our website at: www.darden.com. For those who cannot access
the Internet, please dial 1-877-407-9219. For those who
cannot listen to the live broadcast, a replay will be available
shortly after the call.
About Darden
Darden is a restaurant company featuring
a portfolio of differentiated brands that include Olive Garden,
LongHorn Steakhouse, Yard House, Ruth's Chris Steak House,
Cheddar's Scratch Kitchen, The Capital Grille, Seasons 52, Eddie
V's and Bahama Breeze. For more
information, please visit www.darden.com.
Information About Forward-Looking
Statements
Forward-looking statements in this communication
regarding our expected earnings performance and all other
statements that are not historical facts, including without
limitation statements concerning our future economic performance,
are made under the Safe Harbor provisions of the Private Securities
Litigation Reform Act of 1995. Any forward-looking statements speak
only as of the date on which such statements are first made, and we
undertake no obligation to update such statements to reflect events
or circumstances arising after such date. We wish to caution
investors not to place undue reliance on any such forward-looking
statements. By their nature, forward-looking statements involve
risks and uncertainties that could cause actual results to
materially differ from those anticipated in the statements. The
most significant of these uncertainties are described in Darden's
Form 10-K, Form 10-Q and Form 8-K reports. These risks and
uncertainties include: a failure to address cost pressures and a
failure to effectively deliver cost management activities, economic
factors and their impacts on the restaurant industry and general
macroeconomic factors including unemployment, energy prices and
interest rates, the inability to hire, train, reward and retain
restaurant team members, a failure to develop and recruit effective
leaders, labor and insurance costs, health concerns including
food-related pandemics or outbreaks of flu or other viruses, food
safety and food-borne illness concerns, technology failures
including failure to maintain a secure cyber network, compliance
with privacy and data protection laws and risks of failures or
breaches of our data protection systems, the inability to
successfully integrate Ruth's Chris Steak House operations into our
business, risks relating to public policy changes and federal,
state and local regulation of our business, intense competition,
changing consumer preferences, an inability or failure to manage
the accelerated impact of social media, a failure to execute
innovative marketing and guest relationship tactics, climate
change, adverse weather conditions and natural disasters, long-term
and non-cancelable property leases, failure to execute a business
continuity plan following a disaster, shortages or interruptions in
the delivery of food and other products and services, failure to
drive profitable sales growth, a lack of availability of suitable
locations for new restaurants, higher-than-anticipated costs to
open, close, relocate or remodel restaurants, risks of doing
business with franchisees, licensees and vendors in foreign
markets, volatility in the market value of derivatives, volatility
leading to the inability to hedge equity compensation market
exposure, failure to protect our intellectual property, litigation,
unfavorable publicity, disruptions in the financial markets,
impairment in the carrying value of our goodwill or other
intangible assets, changes in tax laws or unanticipated tax
liabilities, failure of our internal controls over financial
reporting and other factors and uncertainties discussed from time
to time in reports filed by Darden with the Securities and Exchange
Commission.
Non-GAAP Information
The information in this press
release includes financial information determined by methods other
than in accordance with U.S. generally accepted accounting
principles ("GAAP"), such as adjusted diluted net earnings per
share from continuing operations. The Company's management uses
these non-GAAP measures in its analysis of the Company's
performance. The Company believes that the presentation of certain
non-GAAP measures provides useful supplemental information that is
essential to a proper understanding of the operating results of the
Company's businesses. These non-GAAP disclosures should not be
viewed as a substitute for operating results determined in
accordance with GAAP, nor are they necessarily comparable to
non-GAAP performance measures that may be presented by other
companies. Reconciliations of these non-GAAP measures are included
in this release.
(Analysts) Courtney Aquilla,
(407) 245-5054; (Media) Rich
Jeffers, (407) 245-4189
Fiscal Q4 Reported
to Adjusted Earnings Reconciliation
|
|
Q4
2024
|
|
Q4
2023
|
$ in millions, except
per share amounts
|
Earnings
Before
Income
Tax
|
Income
Tax
Expense
|
Net
Earnings
|
Diluted
Net
Earnings
Per
Share
|
|
Earnings
Before
Income
Tax
|
Income
Tax
Expense
|
Net
Earnings
|
Diluted
Net
Earnings
Per
Share
|
Reported Earnings
from Continuing Operations
|
$
360.0
|
$
50.0
|
$
310.0
|
$
2.58
|
|
$
352.4
|
$
36.8
|
$
315.6
|
$
2.58
|
% Change vs Prior
Year
|
|
|
|
— %
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Ruth's Chris
transaction and integration related costs
|
7.4
|
(0.8)
|
8.2
|
0.07
|
|
—
|
—
|
—
|
—
|
Adjusted Earnings
from Continuing Operations
|
$
367.4
|
$
49.2
|
$
318.2
|
$
2.65
|
|
$
352.4
|
$
36.8
|
$
315.6
|
$
2.58
|
% Change vs Prior
Year
|
|
|
|
2.7 %
|
|
|
|
|
|
Fiscal YTD FY24
Reported to Adjusted Earnings Reconciliation
|
|
2024
|
|
2023
|
$ in millions, except
per share amounts
|
Earnings
Before
Income
Tax
|
Income
Tax
Expense
|
Net
Earnings
|
Diluted
Net
Earnings
Per
Share
|
|
Earnings
Before
Income
Tax
|
Income
Tax
Expense
|
Net
Earnings
|
Diluted
Net
Earnings
Per
Share
|
Reported Earnings
from Continuing Operations
|
$
1,175.5
|
$
145.0
|
$
1,030.5
|
$
8.53
|
|
$
1,120.5
|
$
137.0
|
$
983.5
|
$
8.00
|
% Change vs Prior
Year
|
|
|
|
6.6 %
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Ruth's Chris
transaction and integration related costs
|
51.8
|
9.7
|
42.1
|
0.35
|
|
—
|
—
|
—
|
—
|
Adjusted Earnings
from Continuing Operations
|
$
1,227.3
|
$
154.7
|
$
1,072.6
|
$
8.88
|
|
$
1,120.5
|
$
137.0
|
$
983.5
|
$
8.00
|
% Change vs Prior
Year
|
|
|
|
11.0 %
|
|
|
|
|
|
DARDEN RESTAURANTS,
INC.
|
NUMBER OF
COMPANY-OWNED RESTAURANTS
|
|
|
5/26/24
|
5/28/23
|
Olive Garden
|
920
|
905
|
LongHorn
Steakhouse
|
575
|
562
|
Cheddar's Scratch
Kitchen
|
181
|
180
|
Yard House
|
88
|
86
|
Ruth's Chris
|
80
|
—
|
The Capital
Grille
|
66
|
62
|
Seasons 52
|
44
|
44
|
Bahama
Breeze
|
43
|
42
|
Eddie V's
|
30
|
29
|
The Capital
Burger
|
4
|
4
|
Darden Continuing
Operations
|
2,031
|
1,914
|
DARDEN RESTAURANTS,
INC.
|
CONSOLIDATED
STATEMENTS OF EARNINGS
|
(In millions, except
per share data)
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
5/26/2024
|
|
5/28/2023
|
|
5/26/2024
|
|
5/28/2023
|
Sales
|
$ 2,957.3
|
|
$
2,769.0
|
|
$
11,390.0
|
|
$
10,487.8
|
Costs and
expenses:
|
|
|
|
|
|
|
|
Food and
beverage
|
906.9
|
|
855.3
|
|
3,523.9
|
|
3,355.9
|
Restaurant
labor
|
926.0
|
|
869.8
|
|
3,619.3
|
|
3,346.3
|
Restaurant
expenses
|
467.7
|
|
441.4
|
|
1,836.6
|
|
1,702.2
|
Marketing
expenses
|
37.3
|
|
28.7
|
|
144.5
|
|
118.3
|
General and
administrative expenses
|
102.9
|
|
100.4
|
|
479.2
|
|
386.1
|
Depreciation and
amortization
|
119.7
|
|
97.1
|
|
459.9
|
|
387.8
|
Impairments and
disposal of assets, net
|
1.4
|
|
1.8
|
|
12.4
|
|
(10.6)
|
Total operating costs
and expenses
|
$ 2,561.9
|
|
$
2,394.5
|
|
$
10,075.8
|
|
$ 9,286.0
|
Operating
income
|
395.4
|
|
374.5
|
|
1,314.2
|
|
1,201.8
|
Interest,
net
|
35.4
|
|
22.1
|
|
138.7
|
|
81.3
|
Earnings before income
taxes
|
360.0
|
|
352.4
|
|
1,175.5
|
|
1,120.5
|
Income tax
expense
|
50.0
|
|
36.8
|
|
145.0
|
|
137.0
|
Earnings from
continuing operations
|
$
310.0
|
|
$
315.6
|
|
$ 1,030.5
|
|
$
983.5
|
Losses from
discontinued operations, net of tax benefit of $0.7, $0.3, $1.7
and
$0.8, respectively
|
(1.9)
|
|
(0.5)
|
|
(2.9)
|
|
(1.6)
|
Net earnings
|
$
308.1
|
|
$
315.1
|
|
$ 1,027.6
|
|
$
981.9
|
Basic net earnings per
share:
|
|
|
|
|
|
|
|
Earnings from
continuing operations
|
$
2.60
|
|
$
2.61
|
|
$
8.59
|
|
$
8.07
|
Losses from
discontinued operations
|
(0.02)
|
|
—
|
|
(0.02)
|
|
(0.01)
|
Net
earnings
|
$
2.58
|
|
$
2.61
|
|
$
8.57
|
|
$
8.06
|
Diluted net earnings
per share:
|
|
|
|
|
|
|
|
Earnings from
continuing operations
|
$
2.58
|
|
$
2.58
|
|
$
8.53
|
|
$
8.00
|
Losses from
discontinued operations
|
(0.01)
|
|
—
|
|
(0.02)
|
|
(0.01)
|
Net
earnings
|
$
2.57
|
|
$
2.58
|
|
$
8.51
|
|
$
7.99
|
Average number of
common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
119.2
|
|
121.0
|
|
119.9
|
|
121.9
|
Diluted
|
120.1
|
|
122.1
|
|
120.8
|
|
122.9
|
DARDEN RESTAURANTS,
INC.
|
CONSOLIDATED BALANCE
SHEETS
|
(In
millions)
|
|
|
5/26/2024
|
|
5/28/2023
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
194.8
|
|
$
367.8
|
Receivables,
net
|
79.1
|
|
80.2
|
Inventories
|
290.5
|
|
287.9
|
Prepaid income
taxes
|
121.7
|
|
107.3
|
Prepaid expenses and
other current assets
|
136.7
|
|
154.5
|
Total current
assets
|
$
822.8
|
|
$
997.7
|
Land, buildings and
equipment, net
|
4,184.3
|
|
3,725.1
|
Operating lease
right-of-use assets
|
3,429.3
|
|
3,373.9
|
Goodwill
|
1,391.0
|
|
1,037.4
|
Trademarks
|
1,148.0
|
|
806.3
|
Other assets
|
347.6
|
|
301.1
|
Total
assets
|
$
11,323.0
|
|
$
10,241.5
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
399.5
|
|
$
426.2
|
Short-term
debt
|
86.8
|
|
—
|
Accrued
payroll
|
190.1
|
|
173.0
|
Accrued income
taxes
|
6.1
|
|
7.8
|
Other accrued
taxes
|
71.0
|
|
65.9
|
Unearned
revenues
|
591.8
|
|
512.0
|
Other current
liabilities
|
847.2
|
|
752.5
|
Total current
liabilities
|
$
2,192.5
|
|
$
1,937.4
|
Long-term
debt
|
1,370.4
|
|
884.9
|
Deferred income
taxes
|
232.0
|
|
142.2
|
Operating lease
liabilities - non-current
|
3,704.7
|
|
3,667.6
|
Other
liabilities
|
1,580.9
|
|
1,407.9
|
Total
liabilities
|
$
9,080.5
|
|
$
8,040.0
|
Stockholders'
equity:
|
|
|
|
Common stock and
surplus
|
$
2,252.4
|
|
$
2,230.8
|
Retained earnings
(deficit)
|
(35.5)
|
|
(32.5)
|
Accumulated other
comprehensive income
|
25.6
|
|
3.2
|
Total stockholders'
equity
|
$
2,242.5
|
|
$
2,201.5
|
Total liabilities and
stockholders' equity
|
$
11,323.0
|
|
$
10,241.5
|
DARDEN RESTAURANTS,
INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(In
millions)
|
(Unaudited)
|
|
|
Twelve Months
Ended
|
|
5/26/2024
|
|
5/28/2023
|
Cash flows—operating
activities
|
|
|
|
Net
earnings
|
$
1,027.6
|
|
$
981.9
|
Losses from
discontinued operations, net of tax
|
2.9
|
|
1.6
|
Adjustments to
reconcile net earnings from continuing operations to cash
flows:
|
|
|
|
Depreciation and
amortization
|
459.9
|
|
387.8
|
Impairments and
disposal of assets, net
|
12.4
|
|
(10.6)
|
Stock-based
compensation expense
|
68.5
|
|
67.5
|
Change in current
assets and liabilities and other, net
|
50.4
|
|
124.6
|
Net cash provided by
operating activities of continuing operations
|
$
1,621.7
|
|
$
1,552.8
|
Cash flows—investing
activities
|
|
|
|
Purchases of land,
buildings and equipment
|
(601.2)
|
|
(564.9)
|
Proceeds from disposal
of land, buildings and equipment
|
3.3
|
|
25.4
|
Cash used in business
acquisitions, net of cash acquired
|
(701.1)
|
|
—
|
Purchases of
capitalized software and changes in other assets, net
|
(25.6)
|
|
(28.9)
|
Net cash used in
investing activities of continuing operations
|
$
(1,324.6)
|
|
$
(568.4)
|
Cash flows—financing
activities
|
|
|
|
Net proceeds from
issuance of common stock
|
43.6
|
|
35.4
|
Dividends
paid
|
(628.4)
|
|
(589.8)
|
Repurchases of common
stock
|
(453.9)
|
|
(458.7)
|
Proceeds from
short-term debt, net
|
86.8
|
|
—
|
Proceeds from issuance
of long-term debt, net
|
500.0
|
|
—
|
Principal payments on
finance leases, net
|
(19.8)
|
|
(19.8)
|
Payments of debt
issuance costs
|
(11.7)
|
|
(0.2)
|
Net cash used in
financing activities of continuing operations
|
$
(483.4)
|
|
$
(1,033.1)
|
Cash flows—discontinued
operations
|
|
|
|
Net cash used in
operating activities of discontinued operations
|
(9.8)
|
|
(7.2)
|
Net cash used in
discontinued operations
|
$
(9.8)
|
|
$
(7.2)
|
|
|
|
|
Decrease in cash, cash
equivalents, and restricted cash
|
(196.1)
|
|
(55.9)
|
Cash, cash equivalents,
and restricted cash - beginning of period
|
416.2
|
|
472.1
|
Cash, cash equivalents,
and restricted cash - end of period
|
$
220.1
|
|
$
416.2
|
|
Reconciliation of cash,
cash equivalents, and restricted cash:
|
5/26/2024
|
|
5/28/2023
|
Cash and cash
equivalents
|
$
194.8
|
|
$
367.8
|
Restricted cash
included in prepaid expenses and other current assets
|
25.3
|
|
48.4
|
Total cash, cash
equivalents, and restricted cash shown in the statement of cash
flows
|
$
220.1
|
|
$
416.2
|
View original
content:https://www.prnewswire.com/news-releases/darden-restaurants-reports-fiscal-2024-fourth-quarter-and-full-year-results-increases-quarterly-dividend-and-provides-fiscal-2025-outlook-302177424.html
SOURCE Darden Restaurants, Inc.: Financial