Darden Restaurants Reports Fiscal 2021 Fourth Quarter and Full Year Results; Increases Quarterly Dividend; And Provides Fiscal 2022 Outlook

ORLANDO, Fla., June 24, 2021 /PRNewswire/ -- Darden Restaurants, Inc. (NYSE:DRI) today reported its financial results for the fourth quarter and fiscal year ended May 30, 2021.

Fourth Quarter Financial Highlights, Comparisons to Fourth Quarter Last Year and Fourth Quarter Fiscal 2019

• Total sales increased 79.5% to $2.28 billion driven by a blended same-restaurant sales increase of 90.4% and the addition of 30 net new restaurants, partially offset by one less week of operations this year
• Same-restaurant sales:

• Reported diluted net earnings per share was $2.79 as compared to a reported diluted net loss per share of $3.85 last year
• Adjusted diluted net earnings per share was $2.03, after excluding a non-recurring income tax benefit of $0.76, as compared to adjusted diluted net loss per share of $1.24 last year²
• EBITDA of $412 million²

"We had a strong quarter that exceeded our expectations as sales improved throughout the quarter," said Darden Chairman & CEO Gene Lee. "I am proud of how our teams welcomed more of our guests back and created memorable experiences. Over the last 15 months, we have made numerous strategic investments in our business, while streamlining our operations and improving productivity. Given the business transformation work we have done, and the demand we are seeing from the consumer, we are well positioned to thrive in this operating environment."

Fiscal 2021 Financial Highlights, Compared to Fiscal 2020³

• Total sales decreased 7.8% to $7.20 billion driven by a blended same-restaurant sales decrease of 7.8% and one less week of operations this year, partially offset by the addition of 30 net new restaurants
• Same-restaurant sales:

• Reported diluted net earnings per share was $4.80, as compared to reported diluted net loss per share of $0.40 last year
• Adjusted diluted net earnings per share was $4.31, after excluding a non-recurring income tax benefit of $0.76 which was partially offset by $0.27 of charges related to corporate restructuring, as compared to adjusted diluted net earnings per share of $3.13 last year²
• Adjusted EBITDA of $1.04 billion²

Segment Performance
Segment profit represents sales, less costs for food and beverage, restaurant labor, restaurant expenses and marketing expenses. Segment profit excludes non-cash real estate related expenses.

Business Update
Same-restaurant sales performance relative to fiscal 2019⁴ for Darden and its reportable segments for the fiscal periods listed below are as follows:

Average weekly sales and average weekly ToGo sales for the Olive Garden and LongHorn Steakhouse segments are as follows:

Dividend Declared
Darden's Board of Directors declared a quarterly cash dividend of $1.10 per share, a 25% increase from third quarter fiscal 2021, on the Company's outstanding common stock. The dividend is payable on August 2, 2021 to shareholders of record at the close of business on July 9, 2021.

Share Repurchase Program
During the quarter, the Company repurchased approximately 0.3 million shares of its common stock for a total cost of approximately $38 million. As of the end of fiscal 2021, the Company had approximately $463.5 million remaining under the current $500 million repurchase authorization.

"Our strong operating model generates substantial cash flows and, despite a challenging year, we generated $1.2 billion in cash from operations in fiscal 2021," said CFO Raj Vennam. "As a result we repaid our term loan, reinstated our pre-COVID dividend and quickly built up our cash position. Our disciplined approach of focusing on driving profitable sales and simplifying operations positions us well for the future."

Fiscal 2022 Financial Outlook
The financial outlook for fiscal 2022 assumes full operating capacity for essentially all restaurants and no significant business interruptions related to COVID-19.

• Total sales of approximately $9.2 to $9.5 billion
• Total sales growth vs. Pre-COVID⁵ of 5% to 8%
• Same-restaurant sales vs. fiscal 2021 of 25% to 29%
• Approximately 35 to 40 new restaurant openings
• Total capital spending of $375 to $425 million
• Total inflation of approximately 3%
• EBITDA between $1.50 to $1.59 billion*
• Effective tax rate of 13% to 14%
• Diluted net earnings per share from continuing operations of $7.00 to $7.50
• Approximately 131 million weighted average diluted shares outstanding

*See the "Non-GAAP Information" below for more details 

Annual Meeting of Shareholders
Darden will hold its Annual Meeting of Shareholders on September 22, 2021. The meeting will be held in a virtual format only. The record date for shareholders to vote in the Annual Meeting is July 28, 2021.

Investor Conference Call
The Company will host a conference call and slide presentation on Thursday, June 24 at 8:30 am ET to review its recent financial performance. To listen to the call live, please go to https://www.webcaster4.com/Webcast/Page/1007/41444 at least fifteen minutes early to register, download, and install any necessary audio software. Prior to the call, a slide presentation will be posted on the Investor Relations section of our website at: www.darden.com. For those who cannot access the Internet, please dial 1-833-470-0145 and enter passcode 2283499. For those who cannot listen to the live broadcast, a replay will be available shortly after the call.

About Darden
Darden is a restaurant company featuring a portfolio of differentiated brands that include Olive Garden, LongHorn Steakhouse, Cheddar's Scratch Kitchen, Yard House, The Capital Grille, Seasons 52, Bahama Breeze and Eddie V's. For more information, please visit www.darden.com.

Information About Forward-Looking Statements
Forward-looking statements in this communication regarding our expected earnings performance and all other statements that are not historical facts, including without limitation statements concerning our future economic performance, are made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any forward-looking statements speak only as of the date on which such statements are first made, and we undertake no obligation to update such statements to reflect events or circumstances arising after such date. We wish to caution investors not to place undue reliance on any such forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties that could cause actual results to materially differ from those anticipated in the statements. The most significant of these uncertainties are described in Darden's Form 10-K, Form 10-Q and Form 8-K reports. These risks and uncertainties include the impacts of the novel coronavirus (COVID-19) pandemic on our business and the response of governments and of our Company to the outbreak, technology failures including failure to maintain a secure cyber network, food safety and food-borne illness concerns, the inability to hire, train, reward and retain restaurant team members or monitor and proactively respond to employee dissatisfaction, a failure to develop and recruit effective leaders,  litigation, unfavorable publicity, an inability or failure to manage the accelerated impact of social media, risks relating to public policy changes and federal, state and local regulation of our business, long-term and non-cancelable property leases, labor and insurance costs, failure to execute a business continuity plan following a disaster, health concerns including food-related pandemics or virus outbreaks, intense competition, failure to drive profitable sales growth, a lack of availability of suitable locations for new restaurants, higher-than-anticipated costs to open, close, relocate or remodel restaurants, a failure to execute innovative marketing tactics, a failure to address cost pressures, shortages or interruptions in the delivery of food and other products and services, adverse weather conditions and natural disasters, volatility in the market value of derivatives, economic factors specific to the restaurant industry and general macroeconomic factors including interest rates, disruptions in the financial markets, risks of doing business with franchisees, licensees and vendors in foreign markets, failure to protect our intellectual property, impairment in the carrying value of our goodwill or other intangible assets, failure of our internal controls over financial reporting and other factors and uncertainties discussed from time to time in reports filed by Darden with the Securities and Exchange Commission.

Non-GAAP Information
The information in this press release includes financial information determined by methods other than in accordance with U.S. generally accepted accounting principles ("GAAP"), such as adjusted diluted net earnings per share from continuing operations and EBITDA - earnings before interest, taxes, depreciation and amortization. The Company's management uses these non-GAAP measures in its analysis of the Company's performance. The Company believes that the presentation of certain non-GAAP measures provides useful supplemental information that is essential to a proper understanding of the operating results of the Company's businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of these non-GAAP measures are included in this release.

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SOURCE Darden Restaurants, Inc.: Financial