Darden Restaurants beats adjusted earnings per share as Ruth’s Chris sales boost results

Darden Restaurants (DRI) shares rose on Thursday after the company reported better-than-expected adjusted earnings as it benefited from the acquisition of Ruth’s Chris Steak House.

The operator of Ruth’s Chris, Olive Garden and other restaurants reported adjusted earnings per share (EPS) of $2.65 for the fourth quarter of fiscal 2024, above the $2.61 consensus analyst estimate compiled by Visible Alpha. Revenue rose 6.8% year over year to $2.96 billion, just below forecasts.

Darden said the gains came from opening 80 Ruth’s Chris locations and 37 other new restaurants. Darden bought Ruth’s Chris last year for about $715 million.

Sales at stores excluding Ruth’s Chris were flat from a year ago. Sales at the company’s largest restaurant, Olive Garden, fell 1.5 percent and at its fine dining restaurants fell 2.6 percent. At LongHorn Steakhouse, store sales rose 4.0 percent.

CEO speaks of strong results despite “weaker conditions”

CEO Rick Cardenas noted that results were strong despite “weaker conditions that emerged in the second half of the year.” In March, Darden announced that third-quarter revenue declined and lowered its full-year guidance. Cardenas noted that the company “faced an operating environment that was more difficult than expected.”

Darden expects adjusted earnings per share of $9.40 to $9.60 on revenue of $11.8 billion to $11.9 billion for fiscal year 2025. The company forecasts comparable-store sales growth of 1.0 to 2.0 percent.

Darden Restaurants shares rose 1.3% to $153.93 at 10:48 a.m. ET on Thursday. They have fallen 6% since the beginning of the year.