What to Look for
It is estimated that revenues increased to $3.03 billion in the February quarter from $2.79 billion in the prior year period. On average, market watchers believe that third-quarter profit rose to $2.64 per share from $2.34 per share in the prior year period. The report is expected to be released on Thursday, March 21, at 7:00 a.m. ET. Interestingly, the company’s quarterly earnings have mostly beaten estimates in the past ten years.
“We have reached the halfway point in our fiscal year, and I’m pleased with our performance thus far. All of our brands remain focused on managing the business for the long term and the power of Darden positions us well for the future. We also continue to work in pursuit of our shared purpose, to nourish and delight everyone we serve. One of the ways we do this for our team members and their families is through our Next Course Scholarship program,” Darden’s CEO Rick Cardenas said in a recent statement.
Having successfully transitioned some of its restaurants into distribution centers in the last quarter, the company is working to expand the distribution network further. The management has raised its full-year earnings per share guidance to $8.75-$8.90 from the earlier forecast of $8.55-$8.85 per share, excluding transaction and integration costs related to Ruth’s Chris Steak House which joined the Darden fold last year.
Solid 1H
In the November quarter, total sales increased 10% year-over-year to $2.73 billion and came in broadly in line with analysts’ estimates. The top-line growth was driven by a 6% sales growth in the core Olive Garden division, besides strong performance by all other operating segments. Consequently, there was a 21% jump in adjusted earnings to $1.84 per share. Same-store sales increased for both the Olive Garden and LongHorn Steakhouse businesses, but at a slower pace than in the previous quarter and prior-year period.
Darden Restaurants’ stock has gained about 30% in the past five months. It made modest gains in early trading on Monday, after opening the session just above $170.