Red Lobster’s same-restaurant sales up 4.6%

By

SeafoodSource staff

Published on
June 22, 2012

Buoyed by a 4.6 percent increase in U.S. same-restaurant sales, Red Lobster, North America’s largest casual seafood chain, watched its total sales jump 5.9 percent to USD 2.67 billion in fiscal 2012, the brand’s parent company, Darden Restaurants, announced on Friday.

However, Red Lobster’s fourth-quarter sales of USD 681 million fell 2.8 percent from the same quarter in fiscal 2011, reflecting a 3.9 percent drop in U.S. same-restaurant sales but partially offset by revenue from six net new restaurants. The fourth quarter ended on 27 May.

Overall, Darden saw its total sales from continuing operations reach USD 8 billion in fiscal 2012, up 6.6 percent from fiscal 2011, and its net earnings from continuing operations hit USD 476.5 million in fiscal 2012, about the same as in fiscal 2011.

In explaining the company’s fourth quarter and fiscal 2012 results, Darden Chairman and CEO Clarence Otis cited unusually high seafood cost inflation. “The double-digit percentage growth in diluted net earnings per share we achieved for the quarter and for the second half of the fiscal year are testaments to the strength of our business model,” he said. “It’s also important to note that, except for unusually high seafood cost inflation in the first half, earnings growth for the full fiscal year would have been meaningfully stronger. From a sales perspective, growth in the fourth quarter was below expectations, due largely to same-restaurant sales declines at both Olive Garden and Red Lobster that reflected less effective than anticipated nationally advertised promotions.”

Darden also reported that total sales of its specialty restaurant group, which includes the 11 Eddie V’s seafood restaurants it acquired in November 2011, were up 24.1 percent to USD 623 million in fiscal 2012.

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