SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
September 24, 1998
Darden Restaurants, Inc.
(Exact name of registrant as specified in its charter)
Florida 1-13666 59-3305930
(State or other juris- (Commission file number) (IRS employer
diction of incorporation) identification No.)
5900 Lake Ellenor Drive, Orlando, Florida 32809
(Address of principal executive offices)
Registrant's telephone number, including area code:
(407) 245-4000
Not Applicable
(Former name or former address, if changed since last report)
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Item 5. Other Events.
On September 24, 1998, the Registrant issued a news release
reporting certain financial results for the first quarter of
fiscal 1999.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit Number Description
99 Press Release dated September 24, 1998,
entitled "Darden Reports 50% Growth In
First Quarter Earnings Per Share Driven
By Double-Digit Comparable Restaurant
Sales Increases"
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: September 25, 1998 DARDEN RESTAURANTS, INC.
By: /s/ C.L. Whitehill
-----------------------------
C.L. Whitehill
Senior Vice President,
General Counsel and Secretary
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INDEX TO EXHIBITS
Exhibit Number Page
99 Press Release dated September 24, 1998, entitled
"Darden Reports 50% Growth In First Quarter Earnings
Per Share Driven By Double-Digit Comparable Restaurant
Sales Increases" 5
4
EXHIBIT 99
DARDEN REPORTS 50% GROWTH IN FIRST QUARTER EARNINGS PER
SHARE DRIVEN BY DOUBLE-DIGIT COMPARABLE
RESTAURANT SALES INCREASES
ORLANDO, FL - Double-digit comparable restaurant sales increases at both Red
Lobster and Olive Garden led to strong first quarter results at Darden
Restaurants, Inc. The Company today reported earnings after tax of $35.2 million
for the quarter or 24 cents per diluted share, an increase of 50% in earnings
per share over last year.
"This has been an outstanding quarter," said Joe R. Lee, Chairman and Chief
Executive Officer. "We are extremely pleased with the sales performance of Red
Lobster and Olive Garden. These results are directly attributable to the focus
on operating excellence by Brad Blum at Olive Garden and Dick Rivera at Red
Lobster and by employees throughout our organization."
Highlights for the quarter ended August 30, 1998 included:
o Earnings after tax for Darden Restaurants, Inc. in the first quarter were
$35.2 million, or 24 cents per diluted share, on $886.1 million in sales.
This compares to earnings after tax of $24.4 million, or 16 cents per
diluted share, on sales of $809.3 million in the prior year.
o Red Lobster posted an 11.6% comparable restaurant sales gain in the first
quarter. This is the best comparable restaurant sales gain for the concept
in this decade.
o Olive Garden recorded a 10.7% comparable restaurant sales gain in the first
quarter, making this the 16th consecutive quarter of comparable restaurant
sales gains and the second consecutive quarter of double-digit gains.
o Bahama Breeze continued to produce strong sales at all three locations.
Restaurants are currently under development in Tampa, Atlanta, Columbus,
OH, Raleigh, NC and Miami. Several other cities are also slated for
expansion.
o The Company purchased 3.2 million shares of common stock in the first
quarter, proceeding with its previously announced share buyback program.
o The Board of Directors declared the regular 4 cents per share semi-annual
dividend payable November 1, 1998 to shareholders of record October 9,
1998.
OPERATING HIGHLIGHTS
RED LOBSTER'S comparable restaurant sales were up 11.6%. This was the best
comparable sales performance at Red Lobster this decade. Sales of $513.3 million
were approximately 9%
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above the prior year. The strong promotional offerings of "Bottomless Crab" and
"30 Shrimp" generated increased customer traffic and sales throughout the chain.
The two successful high-volume promotions helped produce a double-digit
operating profit increase despite their higher food and labor costs, and
expenses associated with increased training to generate ongoing improvement in
food and service.
"We certainly are moving in the right direction," said Dick Rivera, President of
Red Lobster. "We had a great opportunity this quarter to show off the changes at
Red Lobster to many longtime and new customers. I am proud of our restaurant
management teams and crews for rising to the occasion and providing our guests
with hospitality you can taste and hospitality you can touch. The level of
enthusiasm and energy at Red Lobster is on the rise. We still have more changes
to make and much more work ahead of us, but we are well on our way."
OLIVE GARDEN'S comparable restaurant sales gain of 10.7% represented the second
consecutive quarter of double-digit gains and the 16th consecutive quarter of
comparable restaurant sales increases. Sales of $367.3 million were over 9%
above the prior year. As a result of increased sales and traffic, operating
profit once again rose at a strong double-digit pace for the quarter. Margin
improvement was driven by greater sales leverage and decreased marketing
expenditures.
"The performance of our restaurants speaks to our commitment to quality " said
Brad Blum, President of Olive Garden. "Hospitaliano, our passion for 100% Guest
Delight, is really making a difference, as evidenced by significant increases in
guest visits. We are a family of local restaurants focused on delighting every
guest with a genuine Italian dining experience. The leadership and dedication of
our restaurant teams have propelled Olive Garden to the best performance in our
15-year history. And we believe the best is still to come."
BAHAMA BREEZE continued to produce strong sales at all three restaurants,
including the newest location in Memphis, TN. Restaurants are currently under
development in Tampa, Atlanta, Columbus, OH, Raleigh, NC, and Miami. Several
other cities are also slated for expansion.
OTHER ACTIONS
The Company continued buyback of its common stock in the open market, purchasing
3.2 million shares in the first quarter. Cumulatively, the Company has
repurchased 23.7 million shares out of total authorizations to date of 30.8
million shares.
Darden Restaurants Inc., based in Orlando, Florida, owns and operates Red
Lobster, Olive Garden and Bahama Breeze restaurants with annual sales of $3.3
billion.
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DARDEN RESTAURANTS, INC.
NUMBER OF RESTAURANTS
08/24/97 08/30/98
652 RED LOBSTER USA 646
50 RED LOBSTER CANADA 34
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702 TOTAL RED LOBSTER 680
459 OLIVE GARDEN USA 459
16 OLIVE GARDEN CANADA 5
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475 TOTAL OLIVE GARDEN 464
2 BAHAMA BREEZE 3
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1,179 TOTAL RESTAURANTS 1,147
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