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):
December 16, 1999
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 December 16, 1999, the Registrant issued four news releases
reporting earnings for the second quarter of fiscal 2000 and
certain officer promotions.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit Number Description
99 Press Releases dated December 16,
1999, announcing second quarter
earnings for fiscal 2000 and certain
officer promotions.
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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: December 17, 1999 DARDEN RESTAURANTS, INC.
By: /s/ Paula J. Shives
Paula J. Shives
Senior Vice President,
General Counsel and Secretary
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INDEX TO EXHIBITS
Exhibit Number Page
99 Press Releases dated December 16, 1999, reporting
earnings for the second quarter of fiscal 2000 and
certain officer promotions. 5
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EXHIBIT 99
DARDEN REPORTS 64% INCREASE IN SECOND QUARTER EARNINGS PER
DILUTED SHARE ON CONTINUED SAME-RESTAURANT SALES STRENGTH
ORLANDO, FL - Darden Restaurants, Inc. today reported record second quarter
earnings of 18 cents per diluted share for the quarter ended November 28, 1999,
a 64% increase over last year. Earnings after tax for the quarter were up over
54% to $24.5 million. The world's largest casual-dining restaurant company said
second quarter sales rose approximately 7% to $848.2 million, driven by strong
same-restaurant sales growth at Red Lobster and Olive Garden.
"We are exceptionally pleased with the very strong results at both Red Lobster
and Olive Garden," said Joe R. Lee, Chairman and Chief Executive Officer, "as
well as the positive performance of the newer concepts, Bahama Breeze and Smokey
Bones. As a result of our focus on operating excellence and brand building, we
are taking full advantage of the current strong economy. We believe that even as
economic conditions change, the casual dining industry will continue to be
propelled by favorable consumer lifestyle changes and long-term demographic
trends. Darden is committed to ongoing brilliance and innovation with the basics
to ensure long-term leadership as this growth takes place."
Highlights for the quarter ended November 28, 1999, included:
o Earnings after tax in the second quarter were $24.5 million, or 18 cents
per diluted share, on sales of $848.2 million. Last year, earnings after
tax were $15.9 million, or 11 cents per diluted share on sales of $791.2
million.
o Red Lobster recorded strong sales growth, reporting an 8.2% same-restaurant
sales increase. This outstanding performance represents the 8th consecutive
quarter of same-restaurant sales increases, and contributed to a
triple-digit increase in operating profit for Red Lobster.
o Olive Garden's impressive record of growth continued with a 6.8%
same-restaurant sales increase, representing the 21st consecutive quarter
of same-restaurant sales increases. As a result of healthy sales and
traffic growth, Olive Garden posted a strong double-digit increase in
operating profit to set a new record for second quarter performance.
o Bahama Breeze sales continue to exceed management's expectations at both
newly opened and existing restaurants. Two more restaurants were opened
during the quarter, bringing the number in operation to eight. Four
additional restaurants are under construction.
o Smokey Bones, Darden's latest test concept , opened during the quarter in
Orlando, FL. Business at the BBQ and Sports Bar prototype restaurant is
surpassing management's initial expectations.
o The Company purchased 2.8 million shares of its common stock in the second
quarter.
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Operating Highlights
RED LOBSTER'S second quarter sales of $461.9 million were 6.3% higher than prior
year. Same-restaurant sales increased 8.2% in the quarter, significantly
outpacing an already strong 5.4% increase in the second quarter last year.
Operating profit for the quarter increased at a triple-digit rate as a result of
the strong sales growth and favorable food, beverage and restaurant expenses.
These results were achieved even though Red Lobster operated 26 fewer
restaurants than last year.
"We are excited with our second quarter performance," said Dick Rivera,
President of Red Lobster. "We have strengthened our leadership teams throughout
our company, but especially in our restaurants. These leaders are inspiring our
restaurant crews, who are providing guests with great food and service in an
energetic, upbeat environment, and doing so on a much more consistent basis. We
will continue our focus on operational excellence as we strive to be the best in
casual dining."
OLIVE GARDEN'S second quarter sales of $376.0 million were 6.8% above the prior
year. The 6.8% same-restaurant sales increase in the quarter is particularly
strong coming on top of an 8.7% same-restaurant sales increase in the second
quarter last year. Olive Garden's sales improvement continued to be driven
primarily by guest count growth. This performance, combined with restaurant
labor efficiencies, generated a very strong double-digit operating profit
increase.
"Our team is dedicated to delighting every guest with a genuine Italian dining
experience," said Brad Blum, President of Olive Garden. "This resulted in
another quarter of excellent performance. We were particularly pleased that our
efforts to make wine an integral part of the dining experience led to overall
beverage alcohol sales being up for 13 out of the last 13 weeks with the
momentum continuing to grow. Our teams are focused on providing exceptional
Italian foods and wines with great hospitality in a warm, inviting environment."
BAHAMA BREEZE sales continue to exceed management's expectations at both newly
opened and previously existing restaurants, offering good evidence the company
is successfully building a brand that is attractive to a broad range of
consumers. Two more locations, Louisville, KY and Birmingham, AL, were opened
during the quarter, bringing the total number of units in operation to eight. In
addition, construction has begun on four more restaurants, located in Atlanta
(Kennesaw), GA, Austin, TX, Miami, FL, and Phoenix, AZ. These restaurants are
expected to open during the current fiscal year which ends in May 2000.
SMOKEY BONES, Darden's latest test concept, opened in Orlando, FL during the
quarter. Business at this BBQ and Sports Bar prototype has been strong.
Other Actions
In other actions, the Board of Directors approved the promotions of Clarence
Otis to Senior Vice President, Chief Financial Officer and Linda Dimopoulos to
Senior Vice President, Chief Information Officer.
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Darden continued its buyback of common stock in the open market, purchasing 2.8
million shares in the second quarter. Cumulatively, since initial authorization
of its repurchase program in December 1995, the Company has repurchased 36.8
million shares from a total authorization of 44.6 million shares.
In October, the Olive Garden in partnership with a major wine supplier, Rocca
delle Macie of Tuscany, Italy, opened a restaurant and a culinary institute.
Both the restaurant, Olive Garden Riserva di Fizzano, and culinary school, The
Culinary Institute of Tuscany, are located in Tuscany. The restaurant is
expected to inspire new menu items for Olive Garden and Olive Garden's culinary
teams will use the school to learn first-hand more about Italian cooking
techniques.
Darden Restaurants Inc., headquartered in Orlando, FL, owns and operates Red
Lobster, Olive Garden, Bahama Breeze and Smokey Bones restaurants with annual
sales of $3.5 billion.
DARDEN RESTAURANTS, INC.
NUMBER OF RESTAURANTS
11/29/98 11/28/99
642 Red Lobster USA 618
34 Red Lobster Canada 32
------ ------
676 Total Red Lobster 650
459 Olive Garden USA 458
5 Olive Garden Canada 5
------ ------
464 Total Olive Garden 463
3 Bahama Breeze 8
0 Smokey Bones 1
------ ------
1,143 Total Restaurants 1,122
====== ======
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DARDEN PROMOTES CLARENCE OTIS TO SENIOR VICE PRESIDENT,
CHIEF FINANCIAL OFFICER AND LINDA DIMOPOULOS TO
SENIOR VICE PRESIDENT, CHIEF INFORMATION OFFICER
ORLANDO, FL - Clarence Otis, Darden's Senior Vice President, Finance, has been
promoted to Senior Vice President, Chief Financial Officer, and Linda
Dimopoulos, Darden's Senior Vice President, Corporate Controller and Business
Information Systems has been promoted to Senior Vice President, Chief
Information Officer.
"Clarence and Linda have been key leaders in developing Darden's growth
strategy," said Joe Lee, Darden Chief Executive Officer. "They are proven
leaders and bring a wealth of business experience. They are exactly the right
team to lead our technology and finance areas."
Darden has long been a restaurant industry leader in using technology and
finance to enhance business processes to facilitate operating excellence and
serve as solid platforms for growth.
Clarence and the finance team will focus on managing and growing assets
consistent with the company's business strategies, evaluating acquisitions,
securing sufficient capital from worldwide markets to fund growth, developing
efficient tax strategies and practicing cost-effective risk management.
Linda and the Information Services team will work to adapt our core business
processes to better support restaurant operations in production, labor
management, customer service, design and development. New technologies in
e-commerce, Internet and consumer communications will also be explored to drive
additional business growth.
"The two focused teams we have created with this realignment will enable us to
capitalize fully on opportunities to create industry leading technologies and
financial strategies," said Lee. "These two areas are critical to operations
excellence and future growth, and they require top talent. Clarence's and
Linda's wealth of experience provides that."
Otis joined Darden as Vice President, Treasurer, in July 1995. He was promoted
to Senior Vice President, Investor Relations and Treasurer, in July 1997 and to
Senior Vice President, Finance, in August 1998. Prior to joining Darden,
Clarence was a Managing Director of Chemical Securities, Inc., the investment
banking subsidiary of what is now Chase Manhattan Bank where he was co-head of
the Municipal Securities Group. Prior to that he worked in investment banking at
First Boston and Kidder Peabody and practiced law at a New York law firm.
Dimopoulos joined the company in 1982 as a Senior Financial Analyst for Red
Lobster Eastern Division. She has served in increasingly responsible positions
at Darden, including Senior Vice President, Controller for Red Lobster and her
most recent position as Darden's Senior Vice President, Corporate Controller and
Business Information Systems. Prior to joining Darden she worked with Foodmaker,
Inc. and Cabelcom General.
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Darden Restaurants, in Orlando, Florida, is the world's largest casual dining
company with more than 1,120 restaurants operating under the Red Lobster, Olive
Garden, Bahama Breeze and Smokey Bones brands, with over 115,000 employees and
annual sales of $3.5 billion.
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DARDEN PROMOTES STEVE HELSEL
SENIOR VICE PRESIDENT, CONTROLLER, OF DARDEN RESTAURANTS
ORLANDO, FL - Steve Helsel, Senior Vice President, Information Services has been
promoted to Senior Vice President, Corporate Controller, for Darden Restaurants
and will become a member of the Darden Executive Management team as a Corporate
Officer. He will report to Clarence Otis, Senior Vice President, Chief Financial
Officer.
"Steve's made many contributions to our business and has been a key part of the
financial team at Darden," said Clarence Otis, Senior Vice President and CFO of
Darden. "With his experience in Internal Audit and Information Services and his
operations experience, Steve brings strong leadership to the company's financial
strategy."
In his new position, Helsel will be responsible for day-to-day financial
controls in Accounting, Operations Information, Corporate Reporting and Analysis
and Payroll Services.
Helsel joined the company in 1973 as an Accountant with Red Lobster and has been
promoted to increasingly responsible positions throughout the company during his
career, including Vice President, Controller, for Red Lobster USA, Vice
President, Controller, Accounting Services and his most recent position as
Senior Vice President, Information Services.
Darden Restaurants, in Orlando, Florida, is the world's largest casual dining
company with more than 1,200 restaurants operating under the Red Lobster, Olive
Garden, Bahama Breeze and Smokey Bones brands, with over 115,000 employees and
annual sales of $3.5 billion.
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DARDEN PROMOTES DAVID COX TO
VICE PRESIDENT, COMMODITIES PURCHASING
ORLANDO, FL - David Cox has been promoted to Vice President Commodities
Purchasing, for Darden Restaurants, Inc. Cox, previously Director of Food
Commodities and Smallwares Purchasing, will assume responsibility for directing
the purchase of $700 million in food commodities, packaging and smallwares.
"Combining the Commodity team under David's leadership recognizes the
significant contributions he has made to Darden Restaurants," said Barry
Moullet, Senior Vice President Purchasing, Distribution and Food Safety. "David
is exactly the right person to manage the combined strengths of the new team and
ensure we deliver world-class purchasing support to our restaurants."
Cox joined the Darden team in 1997 as Director, Fish and Crab Purchasing. He
then held subsequent positions as Director, Purchasing Operations, and his most
recent position as Director of Food, Commodities and Smallwares Purchasing.
Prior to joining Darden, David was with Bruegger's Bagles / Quality Dining, RTM
Restaurant Group and Restaurant Services, Inc., the Burger King Purchasing
Cooperative.
Darden Restaurants, in Orlando, Florida, is the world's largest casual dining
company with more than 1,200 restaurants operating under the Red Lobster, Olive
Garden, Bahama Breeze and Smokey Bones brands, with over 115,000 employees and
annual sales of $3.5 billion.
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