Darden Restaurants, Inc. (DRI) has reported 84.03 percent jump in profit for the quarter ended Nov. 27, 2016. The company has earned $79.50 million, or $0.64 a share in the quarter, compared with $43.20 million, or $0.33 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $79.70 million, or $0.64 a share compared with $70.50 million or $0.54 a share, a year ago. Revenue during the quarter went up marginally by 2.09 percent to $1,642.50 million from $1,608.80 million in the previous year period. Gross margin for the quarter contracted 65 basis points over the previous year period to 19.54 percent. Total expenses were 92.91 percent of quarterly revenues, down from 94.92 percent for the same period last year. This has led to an improvement of 201 basis points in operating margin to 7.09 percent.
Operating income for the quarter was $116.50 million, compared with $81.70 million in the previous year period.
"We had another strong quarter with same-restaurant sales growth significantly outperforming the casual dining industry benchmarks, especially at Olive Garden," said chief executive officer Gene Lee. "We remain laser-focused on our operating philosophy rooted in food, service and atmosphere, and creating memorable experiences for our guests."
Darden Restaurants projects revenue to grow in the range of 1 percent to 2 percent for the financial year 2017. For financial year 2017, the company forecasts diluted earnings per share to be in the range of $3.87 to $3.97.
Operating cash flow improves significantlyDarden Restaurants, Inc. has generated cash of $294.30 million from operating activities during the first half, up 54.41 percent or $103.70 million, when compared with the last year period. The company has spent $140.70 million cash to meet investing activities during the first half as against cash inflow of $179.50 million in the last year period
The company has spent $301.20 million cash to carry out financing activities during the first six months as against cash outgo of $23.10 million in the last year period.
Cash and cash equivalents stood at $116.80 million as on Nov. 27, 2016, down 86.38 percent or $740.80 million from $857.60 million on Nov. 29, 2015.
Working capital remains negative
Working capital of Darden Restaurants, Inc. was negative $467.90 million on Nov. 27, 2016 compared with negative $431.90 million on Nov. 29, 2015. Current ratio was at 0.59 as on Nov. 27, 2016, down from 0.76 on Nov. 29, 2015.
Cash conversion cycle (CCC) has increased to 6 days for the quarter from 1 days for the last year period. Days sales outstanding were almost stable at 4 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 6 days for the quarter compared with 12 days for the previous year period. At the same time, days payable outstanding went up to 16 days for the quarter from 14 for the same period last year.
Debt comes down significantly
Darden Restaurants, Inc. has recorded a decline in total debt over the last one year. It stood at $440.50 million as on Nov. 27, 2016, down 63.26 percent or $758.40 million from $1,198.90 million on Nov. 29, 2015. Total debt was 9.87 percent of total assets as on Nov. 27, 2016, compared with 23.13 percent on Nov. 29, 2015. Debt to equity ratio was at 0.24 as on Nov. 27, 2016, down from 0.60 as on Nov. 29, 2015. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
