Darden Restaurants, Inc., reported its financial results for the first quarter ended August 28.
First Quarter 2017 Financial Highlights Versus Same Fiscal Quarter Last Year
Total sales from continuing operations increased 1.6 percent to $1.71 billion
Same-restaurant sales increased 1.3 percent for the quarter
+2 percent for Olive Garden
-1.2 percent for The Capital Grille
+0.0 percent for Yard House
+0.6 percent for LongHorn Steakhouse
-1.7 percent for Eddie V's
+0.7 percent for Seasons 52
+3.9 percent for Bahama Breeze
"I'm pleased with our performance during the quarter and the progress we made against our strategic initiatives," says CEO Gene Lee. "We continued to gain market share and our same-restaurant sales growth outperformed the industry by a considerable margin. We also returned significant capital to shareholders in the form of our regular dividend and $196 million in share repurchases."
Segment Performance Versus Same Fiscal Period Last Year
Segment profit represents sales, less costs for food and beverage, restaurant labor, restaurant expenses and marketing expenses. Segment profit for fiscal 2017 includes the impact of additional rent and other tax expense related to the completion of our real estate strategy, primarily impacting Olive Garden and LongHorn Steakhouse.
Share Repurchase Program
During the quarter, the company repurchased approximately 3.2 million shares of its common stock for a total cost of approximately $196 million. An additional $4 million in shares were repurchased subsequent to the close of the first quarter, for a total of $200 million in shares repurchased year-to-date. In addition, Darden's Board of Directors authorized a new share repurchase program under which the Company may repurchase up to $500 million of its outstanding common stock. This repurchase program does not have an expiration and replaces the previously existing share repurchase authorization.
Updated Fiscal 2017 Financial Outlook
The company reaffirms its outlook for same-restaurant sales of approximately 1 percent to 2 percent and increased the outlook for diluted net earnings per share to $3.87 to $3.97 from $3.80 to $3.90. This reflects approximately 126 million diluted average common shares outstanding for the year.
Darden owns and operates more than 1,500 restaurants that generate $7 billion in annual sales.