Florida | 59-3305930 | |
(State or other jurisdiction of incorporation) | (IRS Employer Identification No.) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition. |
Item 9.01 | Financial Statements and Exhibits. |
(d) | Exhibits. |
Exhibit Number | Description | |
99 | News release dated December 20, 2012, entitled “Darden Restaurants Reports Second Quarter Diluted Net Earnings Per Share of 26 Cents; Declares A Quarterly Dividend of 50 Cents Per Share.” |
DARDEN RESTAURANTS, INC. | |
By: | /s/ C. Bradford Richmond |
C. Bradford Richmond | |
Senior Vice President and Chief Financial Officer |
Exhibit Number | Description of Exhibit | |
99 | News release dated December 20, 2012, entitled “Darden Restaurants Reports Second Quarter Diluted Net Earnings Per Share of 26 Cents; Declares A Quarterly Dividend of 50 Cents Per Share.” |
NEWS/INFORMATION | ||
Corporate Relations | ||
P.O. Box 695011 | ||
Orlando, FL 32869-5011 |
FOR RELEASE | Contacts: | |
December 20, 2012 | (Analysts) Matthew Stroud | (407) 245-6458 |
7:00 AM ET | (Media) Rich Jeffers | (407) 245-4189 |
• | Second quarter diluted net earnings per share from continuing operations were 26 cents, a 37% decrease from the 41 cents per diluted share in the second quarter of last year. Earnings from continuing operations in this year's second quarter were $33.7 million and sales were $1.96 billion, which compare to earnings from continuing operations of $54.1 million and sales of $1.83 billion in the second quarter last year. |
• | Second quarter total sales from continuing operations of $1.96 billion represent an increase of 7.0% compared to the second quarter of last year. The increase reflects a same-restaurant sales increase of 0.7% for the Company's Specialty Restaurant Group, incremental sales from the 11 Eddie V's restaurants acquired on November 14, 2011, the acquisition of 40 Yard House restaurants on August 29, 2012 and the addition and operation of another 99 net new restaurants compared to the second quarter last year, offset by a combined same-restaurant sales decline of 2.7% for Olive Garden, Red Lobster and LongHorn Steakhouse. In the second quarter, U.S. same-restaurant sales decreased -0.8%, -2.7% and -3.2% for LongHorn Steakhouse, Red Lobster and Olive Garden, respectively. |
• | The Company estimated that costs associated with the acquisition of Yard House USA, Inc., which was completed on August 29, 2012, the beginning of this year's second quarter, adversely affected diluted net earnings per share for this year's second quarter by approximately five cents. |
• | Darden's Board of Directors declared a quarterly dividend of 50 cents per share. |
Olive Garden | September | October | November* |
Same-Restaurant Sales | -3.8% | -3.9% | -2.0% |
Same-Restaurant Traffic | -7.5% | -8.2% | -4.8% |
Pricing | 2.0% | 2.3% | 2.4% |
Menu-mix | 1.8% | 2.0% | 0.4% |
Red Lobster | September | October | November* |
Same-Restaurant Sales | 0.4% | -7.0% | -2.8% |
Same-Restaurant Traffic | 1.3% | -6.1% | -3.3% |
Pricing | 1.3% | 1.3% | 1.2% |
Menu-mix | -2.2% | -2.2% | -0.7% |
LongHorn Steakhouse | September | October | November* |
Same-Restaurant Sales | -1.1% | -0.1% | -1.3% |
Same-Restaurant Traffic | -1.0% | -0.2% | -0.2% |
Pricing | 2.0% | 2.0% | 1.9% |
Menu-mix | -2.1% | -1.9% | -3.0% |
11/25/12 | 11/27/11 | |||||
679 | Red Lobster USA | 674 | ||||
27 | Red Lobster Canada | 27 | ||||
706 | Total Red Lobster | 701 | ||||
803 | Olive Garden USA | 757 | ||||
6 | Olive Garden Canada | 6 | ||||
809 | Total Olive Garden | 763 | ||||
399 | LongHorn Steakhouse | 367 | ||||
48 | The Capital Grille | 45 | ||||
32 | Bahama Breeze | 27 | ||||
25 | Seasons 52 | 21 | ||||
11 | Eddie V's | 11 | ||||
41 | Yard House | — | ||||
4 | Other | 1 | ||||
2,075 | Total Restaurants | 1,936 |
Three Months Ended | Six Months Ended | ||||||||||||||
11/25/2012 | 11/27/2011 | 11/25/2012 | 11/27/2011 | ||||||||||||
Sales | $ | 1,960.0 | $ | 1,831.5 | $ | 3,994.8 | $ | 3,773.4 | |||||||
Costs and expenses: | |||||||||||||||
Cost of sales: | |||||||||||||||
Food and beverage | 607.5 | 573.3 | 1,226.3 | 1,166.7 | |||||||||||
Restaurant labor | 635.7 | 594.2 | 1,262.5 | 1,207.3 | |||||||||||
Restaurant expenses | 325.5 | 293.1 | 629.7 | 593.0 | |||||||||||
Total cost of sales (1) | $ | 1,568.7 | $ | 1,460.6 | $ | 3,118.5 | $ | 2,967.0 | |||||||
Selling, general and administrative | 216.1 | 187.4 | 434.2 | 370.2 | |||||||||||
Depreciation and amortization | 99.2 | 85.8 | 191.8 | 169.8 | |||||||||||
Interest, net | 32.9 | 25.2 | 60.8 | 46.9 | |||||||||||
Total costs and expenses | $ | 1,916.9 | $ | 1,759.0 | $ | 3,805.3 | $ | 3,553.9 | |||||||
Earnings before income taxes | 43.1 | 72.5 | 189.5 | 219.5 | |||||||||||
Income taxes | (9.4 | ) | (18.4 | ) | (44.7 | ) | (58.7 | ) | |||||||
Earnings from continuing operations | $ | 33.7 | $ | 54.1 | $ | 144.8 | $ | 160.8 | |||||||
Losses from discontinued operations, net of tax benefit of $0.1, $0.2, $0.3 and $0.4, respectively | (0.1 | ) | (0.4 | ) | (0.4 | ) | (0.5 | ) | |||||||
Net earnings | $ | 33.6 | $ | 53.7 | $ | 144.4 | $ | 160.3 | |||||||
Basic net earnings per share: | |||||||||||||||
Earnings from continuing operations | $ | 0.26 | $ | 0.42 | $ | 1.13 | $ | 1.22 | |||||||
Losses from discontinued operations | — | (0.01 | ) | (0.01 | ) | (0.01 | ) | ||||||||
Net earnings | $ | 0.26 | $ | 0.41 | $ | 1.12 | $ | 1.21 | |||||||
Diluted net earnings per share: | |||||||||||||||
Earnings from continuing operations | $ | 0.26 | $ | 0.41 | $ | 1.10 | $ | 1.19 | |||||||
Losses from discontinued operations | — | (0.01 | ) | — | — | ||||||||||
Net earnings | $ | 0.26 | $ | 0.40 | $ | 1.10 | $ | 1.19 | |||||||
Average number of common shares outstanding: | |||||||||||||||
Basic | 128.8 | 130.3 | 128.5 | 132.0 | |||||||||||
Diluted | 131.7 | 133.2 | 131.4 | 135.2 | |||||||||||
(1) Excludes restaurant depreciation and amortization as follows: | $ | 94.1 | $ | 80.6 | $ | 181.5 | $ | 159.0 |
11/25/2012 | 5/27/2012 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 61.4 | $ | 70.5 | |||
Receivables, net | 66.7 | 71.4 | |||||
Inventories | 425.3 | 404.1 | |||||
Prepaid income taxes | 11.3 | 12.2 | |||||
Prepaid expenses and other current assets | 83.6 | 74.9 | |||||
Deferred income taxes | 152.3 | 124.5 | |||||
Total current assets | $ | 800.6 | $ | 757.6 | |||
Land, buildings and equipment, net | 4,285.7 | 3,951.3 | |||||
Goodwill | 904.9 | 538.6 | |||||
Trademarks | 574.2 | 464.9 | |||||
Other assets | 267.3 | 231.8 | |||||
Total assets | $ | 6,832.7 | $ | 5,944.2 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 315.6 | $ | 260.7 | |||
Short-term debt | 376.0 | 262.7 | |||||
Accrued payroll | 134.8 | 154.3 | |||||
Accrued income taxes | 7.8 | — | |||||
Other accrued taxes | 52.7 | 60.4 | |||||
Unearned revenues | 220.7 | 231.7 | |||||
Current portion of long-term debt | — | 349.9 | |||||
Other current liabilities | 436.0 | 454.4 | |||||
Total current liabilities | $ | 1,543.6 | $ | 1,774.1 | |||
Long-term debt, less current portion | 2,503.5 | 1,453.7 | |||||
Deferred income taxes | 343.3 | 312.9 | |||||
Deferred rent | 216.5 | 204.4 | |||||
Obligations under capital leases, net of current installments | 53.5 | 54.4 | |||||
Other liabilities | 308.9 | 302.7 | |||||
Total liabilities | $ | 4,969.3 | $ | 4,102.2 | |||
Stockholders’ equity: | |||||||
Common stock and surplus | $ | 1,164.3 | $ | 2,518.8 | |||
Retained earnings | 861.8 | 3,172.8 | |||||
Treasury stock | (8.7 | ) | (3,695.8 | ) | |||
Accumulated other comprehensive income (loss) | (147.7 | ) | (146.6 | ) | |||
Unearned compensation | (6.3 | ) | (7.2 | ) | |||
Total stockholders’ equity | $ | 1,863.4 | $ | 1,842.0 | |||
Total liabilities and stockholders’ equity | $ | 6,832.7 | $ | 5,944.2 |
Six Months Ended | |||||||
11/25/2012 | 11/27/2011 | ||||||
Cash flows—operating activities | |||||||
Net earnings | $ | 144.4 | $ | 160.3 | |||
Losses from discontinued operations, net of tax benefit | 0.4 | 0.5 | |||||
Adjustments to reconcile net earnings from continuing operations to cash flows: | |||||||
Depreciation and amortization | 191.8 | 169.8 | |||||
Stock-based compensation expense | 28.7 | 24.7 | |||||
Change in current assets and liabilities and other, net | (97.7 | ) | (275.0 | ) | |||
Net cash provided by operating activities of continuing operations | $ | 267.6 | $ | 80.3 | |||
Cash flows—investing activities | |||||||
Purchases of land, buildings and equipment | (355.2 | ) | (338.4 | ) | |||
Proceeds from disposal of land, buildings and equipment | — | 2.1 | |||||
Cash used in business acquisitions, net of cash acquired | (578.4 | ) | (59.2 | ) | |||
Increase in other assets | (15.8 | ) | (12.6 | ) | |||
Net cash used in investing activities of continuing operations | $ | (949.4 | ) | $ | (408.1 | ) | |
Cash flows—financing activities | |||||||
Proceeds from issuance of common stock | 37.4 | 28.3 | |||||
Income tax benefits credited to equity | 8.3 | 8.3 | |||||
Dividends paid | (128.5 | ) | (113.6 | ) | |||
Purchases of treasury stock | (52.3 | ) | (279.1 | ) | |||
ESOP note receivable repayment | 0.9 | 1.2 | |||||
Proceeds from issuance of short-term debt, net | 113.4 | 269.5 | |||||
Repayment of long-term debt | (350.9 | ) | (1.2 | ) | |||
Principal payments on capital leases | (0.8 | ) | (0.8 | ) | |||
Proceeds from issuance of long-term debt | 1,050.0 | 400.0 | |||||
Payment of debt issuance costs | (7.3 | ) | (4.8 | ) | |||
Net cash provided by financing activities of continuing operations | $ | 670.2 | $ | 307.8 | |||
Cash flows—discontinued operations | |||||||
Net cash used in operating activities of discontinued operations | (0.2 | ) | (0.3 | ) | |||
Net cash provided by investing activities of discontinued operations | 2.7 | — | |||||
Net cash provided by (used in) discontinued operations | $ | 2.5 | $ | (0.3 | ) | ||
Decrease in cash and cash equivalents | (9.1 | ) | (20.3 | ) | |||
Cash and cash equivalents - beginning of period | 70.5 | 70.5 | |||||
Cash and cash equivalents - end of period | $ | 61.4 | $ | 50.2 |
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