The COVID-19 pandemic might have benefited food retailers by driving up demand for processed food products but companies in the foodservice industry took a real hit from the crisis as they had to shut down most of their restaurants or operate under restricted hours. During the lockdown period, takeaway and delivery services saw a large uptick and those with strong delivery channels managed to use it to their advantage.
Darden Restaurants (NYSE: DRI) saw sales decrease 19% year-over-year in the second quarter of 2021 with sales declines across all its segments. Same-restaurant sales fell 20.6%. Although the company had around 97% of its dining rooms open in the middle of the quarter, this fell to 80% by quarter-end, impacting same-restaurant sales by 200 basis points. This downtick in sales impacted operating income by around $15 million. For the third quarter of 2021, Darden expects total sales to range from $1.53-1.65 billion and EPS to range from $0.50-0.75.
Starbucks Corporation (NASDAQ: SBUX) reported an 8% decline in net revenues for the fourth quarter of 2020 mainly due to lost sales caused by the pandemic. Net revenues declined over 11% for fiscal year 2020. Lost sales amounted to around $1.2 billion for the fourth quarter and around $5.1 billion for the full year. For FY2021, Starbucks expects adjusted EPS of $2.70-2.90.
Chipotle Mexican Grill
After seeing its net sales drop 5% in Q2 along with a decline of 9.8% in comparable restaurant sales, Chipotle Mexican Grill (NYSE: CMG) managed to drive an uptick in sales by the third quarter of 2020, delivering a 14% growth in revenue along with an 8.3% increase in comps. Since the decline seen in late March, the company was able to retain 80-85% of its digital sales gains while recovering 50-55% of its in-store sales. Chipotle’s digital channel played a key role in helping it regain growth and the company has been investing significantly to improve its delivery services.
Yum Brands Inc. (NYSE: YUM) too suffered from pandemic-related store closures and saw revenue fall 9% in the second quarter of 2020 along with declines across all its segments. However the company managed to improve its performance in Q3 with a net sales increase of 8% and sales growth in the Pizza Hut and Taco Bell divisions. KFC posted a sales decline of 4% in Q3 after seeing a 30% drop in Q2.
Yum has a strong digital channel which delivered a sales increase of more than $1 billion in Q3. The company’s delivery services played a significant role in the growth pickup during the most recent quarter.
Looking for more insights on the earnings results? Click here to access the full transcripts of the latest earnings conference calls!
The Coca-Cola Company (NYSE: KO) reported first-quarter 2021 financial results before the regular market hours on Monday. The beverage manufacturer reported fourth-quarter revenue of $9 billion, up 5% year-over-year. The
The market rally gathered pace this week amid impressive quarterly results, led by the banking sector, and positive economic data. Leading stock indexes continued their winning streak, with S&P 500
Leading Wall Street banks recorded robust earnings in the early months of fiscal 2021 with the results benefiting from the release of credit loss reserves, in most cases. Taking advantage