Darden Restaurants Inc. (NYSE: DRI) said its profit in the fiscal second quarter topped analysts’ estimates on Friday. Sales at Olive Garden, however, slid more than expected in the recent quarter. In a report published in September, the restaurant operator had reported a hit to its sales in the fiscal first quarter as well.
On the intraday chart, Darden Restaurants shares are currently more than 1% down. The NYSE-listed company has gained close to 250% since its low in March, when the COVID-19 crisis pushed its restaurants into temporarily shutting down.
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Darden Restaurants’ Q2 financial results versus analysts’ estimates
Darden Restaurants said that its net income in the quarter that concluded on 29th November printed at £71.22 million that translates to 54.16 pence per share. In the same quarter last year, it had reported a significantly lower £18.32 million of net income, or 14.84 pence per share.
In terms of sales, the multi-brand restaurant operator registered a 19.4% year over year decline in Q2 to £1.23 billion. According to FactSet, experts had forecast the company to post a higher £1.25 billion of sales in the recent quarter. Their estimate for per-share earnings stood at a lower 52.67 pence.
Other prominent figures in Darden’s earnings report on Friday include a 19% annualised decline in sales at Olive Garden to £615.36 million. FactSet Consensus for Olive Garden sales in Q2, in comparison, stood at a higher £634.58 million.
The Orlando-based company said that its comparable-store sales in the second quarter saw a 19.9% decline from last year versus a narrower 17.4% decline expected. Its fine-dining restaurants reported a much broader 31% decline in same-store sales in Q2 versus an 11.1% decline at LongHorn Steakhouse.
Darden Restaurants’ guidance for the fiscal third quarter
For the fiscal third quarter. Darden Restaurants now forecasts its per-share earnings to fall in the range of 37.09 pence per share to 55.64 pence per share. Analysts, on the other hand, are calling for a significantly higher 99 pence per share of earnings in Q3. Darden forecasts an up to 70% annualised decline in its third-quarter total sales versus a much narrower experts’ forecast of 14.9%, as per FactSet.
Darden Restaurants performed fairly upbeat in the stock market last year with an annual gain of close to 10%. At the time of writing, it has a market capitalisation of £11.44 billion.