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LongHorn Steakhouse sales soar as Darden moves closer to recovery

Olive Garden’s sales increased relative to 2019, while the casual dining operator’s fine dining concepts see improvements.
Darden Restaurants fourth quarter sales
Photograph: Shutterstock

LongHorn Steakhouse has soared this spring as consumers flocked to the chain’s steakhouses as states reopened dining rooms, helping parent company Darden Restaurant to a better-than-expected spring quarter, the company said on Thursday.

LongHorn’s same-store sales rose 13.5% in the quarter ended May 30 when compared to the same period in 2019.

Sister chain Olive Garden, meanwhile, said same-store sales were down 1.5% from the same period—though its sales turned positive in both April and May, after consumers received stimulus checks and began going out to eat more often.

For the entire Orlando-based company, which also includes Cheddar’s Scratch Kitchen and several fine-dining concepts, same-store sales were down 0.5% in the period.

“We had a strong quarter that exceeded our expectations as sales improved throughout the quarter,” Darden CEO Gene Lee said in a statement. “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.”

Total sales for the company in the quarter rose 80% to $2.3 billion, though for the company’s 2021 fiscal year they declined 7.8% to $7.2 billion.

Still, the company said that it generated $412 million in EBITDA, or earnings before interest, taxes, depreciation and amortization, in the fourth quarter. Net earnings for the quarter were $368.5 million, or $2.78 per share, up from steep losses a year ago.

Darden has started paying dividends to shareholders and began buying back shares. It also repaid the company’s term loan.

The company expects same-store sales to rise between 5% and 8% this fiscal year compared with pre-COVID levels and expects 35 to 40 restaurant openings.

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