Darden Restaurants (DRI) can’t seem to figure out how to fix problems at its Olive Garden chain, and it’s now dealing with weakness at Red Lobster too. Olive Garden contributes about half of Darden’s revenues and it’s been struggling for several quarters. Despite Darden’s efforts to change prices and the menu, same-restaurant sales slid 1.6% in the quarter. Red Lobster saw a 3.9% drop. That weakness� “reflected less effective than anticipated nationally advertised promotions.”
Olive Garden’s weakness also appeared to be accelerating. In March and April, same-restaurant-sales fell by 0.9% and 0.4% respectively, but in May they plunged 4.6%, according to the company.
Darden met analysts expectations for $1.15 in EPS, but projections were weak. Its guidance implied 2013 EPS of $3.87 to $4.01, below expectations for $4.05.
Darden shares fell 1.4% early.
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