In Pittsburg, California, a customer is seen carrying a shopping bag from Olive Garden on Friday, Dec. 9, 2022.
David Paul Morris | Bloomberg | Getty Images
Darden Restaurants announced on Thursday that its first-quarter earnings and revenue exceeded analyst expectations, despite a decrease in sales within its fine-dining sector, which includes Ruth’s Chris Steak House.
The decline in same-store sales within the fine-dining segment indicates that consumers are choosing to spend less on upscale restaurant meals.
In premarket trading, the company’s shares fell more than 1%.
Here’s how the company’s performance for the quarter ended Aug. 27 compared to Wall Street’s expectations, based on a survey of analysts conducted by LSEG, formerly known as Refinitiv:
- Earnings per share: $1.78 adjusted versus $1.74 expected
- Revenue: $2.73 billion versus $2.71 billion expected
In the fiscal first quarter, Darden reported a net income of $194.5 million, or $1.59 per share, compared to $193 million, or $1.56 per share, in the same period last year.
Excluding certain items, the restaurant company earned $1.78 per share from its ongoing operations.
Net sales increased by 11.6% to $2.73 billion.
Darden’s same-store sales, excluding those of Ruth’s Chris, experienced a 5% growth in the quarter.
The results for Ruth’s Chris are not included in Darden’s same-store sales until it has owned the steakhouse chain for at least 16 months. The acquisition, valued at $715 million, was finalized in mid-June.
In terms of performance, LongHorn Steakhouse ranked the highest among Darden’s portfolio during this quarter, with same-store sales growth of 8.1%, surpassing StreetAccount estimates of 6.1%.
Darden Restaurants also reaffirmed its expectations for fiscal 2024, projecting net sales of $11.5 billion to $11.6 billion, same-store sales growth of 2.5% to 3.5%, and adjusted earnings per share from ongoing operations of $8.55 to $8.85.
