Darden Restaurants (DRI) Reports Q2 Results, Offers Guidance; Declares $1.10 Dividend
Darden Restaurants, Inc., (NYSE: DRI) today reported its financial results for the second quarter ended November 28, 2021.
Second Quarter 2022 Financial Highlights
- Total sales increased 37% from last year to $2.27 billion driven by a blended same-restaurant sales increase of 34.4% and the addition of 34 net new restaurants
- Same-restaurant sales by segment:
Consolidated Darden | 34.4% | |||
Olive Garden | 29.3% | |||
LongHorn Steakhouse | 31.2% | |||
Fine Dining | 61.6% | |||
Other Business | 42.9% |
- Diluted net earnings per share from continuing operations was $1.48 as compared to diluted net earnings per share from continuing operations of $0.74 last year
- Net earnings from continuing operations were $193 million
- EBITDA of $335 million1
- The Company repurchased $266 million of its outstanding common stock
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1 See the "Non-GAAP Information" below for more details.
"Our restaurant teams did a fantastic job executing at a high level once again this quarter, resulting in strong sales and earnings," said Chairman and CEO Gene Lee. "Our people fuel our success, which is why we have invested more than $200 million in our team members over the past two years. Given the strength of our performance, we are accelerating a commitment we announced earlier this year to increase the minimum hourly earnings for restaurant team members to $12, which includes income earned through gratuities, effective January 1, 2022. With this change, we expect our restaurant team members will earn, on average, approximately $20 per hour."
Segment Performance Segment profit represents sales, less costs for food and beverage, restaurant labor, restaurant expenses and marketing expenses. Segment profit excludes non-cash real estate related expenses.
Q2 Sales | Q2 Segment Profit | |||||||||||
($ in millions) | 2022 | 2021 | 2020 | 2022 | 2021 | 2020 | ||||||
Consolidated Darden | $2,272.2 | $1,656.5 | $2,056.4 | |||||||||
Olive Garden | $1,077.2 | $829.5 | $1,023.6 | $235.1 | $175.1 | $190.3 | ||||||
LongHorn Steakhouse | $547.2 | $407.4 | $447.3 | $83.6 | $66.3 | $71.9 | ||||||
Fine Dining | $188.7 | $107.3 | $154.8 | $39.7 | $20.4 | $30.4 | ||||||
Other Business | $459.1 | $312.3 | $430.7 | $62.3 | $39.2 | $47.7 | ||||||
YTD Sales | YTD Segment Profit | |||||||||||
($ in millions) | 2022 | 2021 | 2020 | 2022 | 2021 | 2020 | ||||||
Consolidated Darden | $4,578.2 | $3,183.9 | $4,190.3 | |||||||||
Olive Garden | $2,167.6 | $1,617.7 | $2,113.8 | $488.4 | $348.9 | $419.2 | ||||||
LongHorn Steakhouse | $1,114.3 | $784.1 | $897.5 | $191.1 | $123.3 | $146.4 | ||||||
Fine Dining | $357.5 | $190.0 | $291.1 | $73.2 | $30.5 | $50.7 | ||||||
Other Business | $938.8 | $592.1 | $887.9 | $147.1 | $74.7 | $112.1 | ||||||
Average weekly sales by segment:
Q2 Average Weekly Sales | |||
2022 | 2021 | 2020 | |
Consolidated Darden | $94,296 | $69,971 | $88,055 |
Olive Garden | $94,187 | $72,913 | $90,871 |
LongHorn Steakhouse | $78,330 | $59,621 | $66,867 |
Fine Dining | $164,859 | $100,926 | $147,668 |
Other Business | $101,489 | $71,107 | $99,653 |
Dividend Declared Darden's Board of Directors declared a quarterly cash dividend of $1.10 per share on the Company's outstanding common stock. The dividend is payable on February 1, 2022 to shareholders of record at the close of business on January 10, 2022.
Share Repurchase Program During the quarter, the Company repurchased 1.8 million shares of its common stock for a total cost of $266 million. As of the end of the second quarter, the Company had $761 million remaining under the current repurchase authorization.
Updated Fiscal 2022 Financial Outlook The Company updated its financial outlook for fiscal 2022 based on year-to-date results and its expected performance for the remainder of the year, assuming no significant business interruptions related to COVID-19.
- Total sales of approximately $9.55 to $9.70 billion
- Total sales growth vs. Pre-COVID1 of 9% to 11%
- Same-restaurant sales vs. fiscal 2021 of 29% to 31%
- 35 to 40 new restaurant openings
- Total capital spending of approximately $425 million
- Total inflation of approximately 5.5%
- EBITDA between $1.55 to $1.60 billion2
- Effective tax rate of approximately 14%
- Diluted net earnings per share from continuing operations of $7.35 to $7.60
- Approximately 130 million weighted average diluted shares outstanding
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1 Comparison to twelve months ended Q3 fiscal 2020 due to impact of pandemic. 2 See the "Non-GAAP Information" below for more details.
Investor Conference Call The Company will host a conference call and slide presentation on Friday, December 17 at 8:30 am ET to review its recent financial performance. To listen to the call live, please go to https://www.webcaster4.com/Webcast/Page/1007/43770 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 1-800-263-0877 and enter passcode 6941295. For those who cannot listen to the live broadcast, a replay will be available shortly after the call.