UPDATE: Darden Restaurants, Inc. Posts Upbeat FQ1 Earnings, Shares Jump
Shares of Darden Restaurants, Inc. (NYSE: DRI) jumped more than 3% in pre-market trading after the company reported better-than-expected fiscal first quarter earnings.
The Orlando, Florida-based company reported a quarterly loss of $19.3 million, or $0.14 per share, versus a year-ago profit of $42.2 million, or $0.32 per share. Excluding non-recurring items, the company earned $0.32 per share.
Its sales surged to $1.6 billion versus $1.53 billion. However, analysts were expecting earnings of $0.30 per share on revenue of $1.6 billion.
Olive Garden's sales fell 0.5% to $913.5 million, while Longhorn Steakhouse's sales surged 9.7% to $356.9 million in the quarter. The Specialty Restaurants' sales jumped 14.5% to $322.3 million in the quarter.
Gene Lee, President and Chief Operating Officer of Darden said, "The Olive Garden Brand Renaissance is well underway, and the improvements we are seeing in guest satisfaction and traffic trends reinforce our confidence in Olive Garden's potential. At LongHorn and the Specialty Restaurants, our actions to enhance the guest experience are also delivering positive results as demonstrated by the increases in same-restaurant sales.”
Darden projects Q2 adjusted earnings of $0.26 to $0.28 per share and full-year earnings of $2.22 to $2.30 per share. Analysts expected earnings of $0.26 per share for the second quarter and $2.23 per share for the year.
Darden's board declared a quarterly cash dividend of $0.55 per share.
Darden used around $1.0 billion of the net cash proceeds from the Red Lobster sale to retire debt. The company also sees potential for $700 million buyback plan in 2015 from Red Lobster sale proceeds.
Darden shares surged 3.54% to $50.00 in pre-market trading.
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