America’s Top 10 Restaurant Groups

A snapshot of the Top 10 restaurant groups based on their 2013 sales shows little movement from 2012, with the exception of newcomer Ignite Restaurant Group stepping onto the roster. (Ruby Tuesday was included in last year’s list of Top 10 groups, but with just one full-service brand and one fast-casual concept, it no longer constitutes a restaurant group. For FSR’s Top 10 list, a portfolio must include at least two full-service concepts to be considered.)

But if 2013 was a relatively uneventful and calm year, 2014 has already felt the winds of change blow through—all thanks to the movement of one very big fish. As Darden Restaurants and Golden Gate Capital prepare to close on the $2.1 billion Red Lobster transaction, both restaurant groups will see a substantial shift in overall corporate revenues.

For now, Darden holds fast to the No. 1 spot on the Top 10 ranking with 2013 sales topping $8.76 billion, but without Red Lobster’s $2.4 billion contribution in 2014, Darden stands to slip a notch in the coming year. On the flip side, netting the seafood chain should take Golden Gate from its position as a $1 billion player to a $3 billion force in the coming months. And other groups face lingering questions and potential opportunities for growth as 2014 continues to unfold. Here’s a brief take on the outlook for leading restaurant groups:

Darden Restaurants

  • Olive Garden
  • LongHorn Steakhouse
  • The Capital Grille
  • Bahama Breeze
  • Seasons 52
  • Eddie V’s
  • Yard House
  • Red Lobster was part
    of the group in 2013.

2013 Sales: $8.76 billion Early in 2014, the fate of Red Lobster reigned as the looming 800-pound gorilla in Darden’s corporate living room, especially as activist investors clamored for change, and sales and traffic counts continued to founder. When news broke in early summer that Darden would sell the seafood chain to Golden Gate Capital, questions surrounding Red Lobster abated.

Yet, Darden is far from off the hook.

Olive Garden, Darden’s dominant chain, faces its own stimulating battle. Late last year, the Italian concept introduced menu developments aimed at boosting sagging sales, including an Italiano Burger and expanded “Lighter Italian Fare,” the latter being a clear push to attract lunch diners and compete for health-conscious consumers.

Darden veteran CEO and chairman Clarence Otis prioritized tech investments, including one-on-one marketing with customers and data mining. Olive Garden, meanwhile, should complete its nationwide rollout of online ordering this fall, while the chain also tests tabletop units.

On the positive side, Darden is recording success at its upscale specialty brands, including double-digit sales gains at Eddie V’s and Seasons 52, as well as impressive growth at Yard House. This uptick is expected to continue, as John Secor, managing director with Duff & Phelps Securities, a global valuation and corporate finance adviser, explains, “Higher-end brands are benefiting from the continued recovery trends of fine dining.”


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