By Dhirendra Tripathi
Investing.com – Shares of Darden Restaurants (NYSE:DRI) reversed initial losses in Thursday’s premarket trading after slightly better-than-expected guidance for the coming year offset disappointment over sluggish sales and rising costs.
For the ongoing fiscal 2022, the company sees total sales of approximately $9.2 billion to $9.5 billion. Diluted net EPS is seen between $7 and $7.50, the midpoint of which is fractionally above the consensus of $7.21.
Consolidated same-restaurant sales for the quarter ended May 30 were 0.5% below the 2019 level, despite rising 80% on a year-on-year basis.
Total sales of $2.28 billion were driven by a blended same-restaurant sales increase of 90% and the addition of 30 net new restaurants.
While earnings rose, costs accelerated too. Inflation in food and beverages was sharp as they rose to $663.1 million from $396.5 million in the same quarter last fiscal. Higher wage costs hurt too.
Adjusted diluted net earnings per share was $2.03 compared to a net loss per share of $1.24 last year.