Darden Restaurants Inc., the world’s largest casual dining company, quarterly profit dip more than the Wall Street’s expectations as sales fell 2.2 percent at stores open at least 16 months in its Red Lobster chain.

Darden, which owns and operates chains like Red Lobster and Olive Garden, posted a net loss of $55.1 million, or 39 cents a share, for the quarter ended May 27, as compare to a profit of $92.3 million, or 60 cents a share year earlier.

Apart from the loss making chains, Darden’s Smokey Bones barbecue chain makes some profit, but still could not exceed the Wall Street expectation as it earns only 67 cents a share, whereas Wall Street analysts had expected 71 cents a share.

Eventhough Company’s total revenue mounts by 3.2 percent, to $1.46 billion, driven primarily by strong same-restaurant sales growth and new restaurant growth at Olive Garden, but it also ditched analysts’ forecast, which were on hefty $1.54 billion.

Darden alleges that stiff rise in the oil prices were the main profit plunder for the dining company as it eloped customers from its sale. After striking by the losses Darden has planed to locked its 56 restaurants and is offering the remaining 73 outlets for sale due to languishing sales at Smokey Bones.

At the time, the Orlando, Florida, company said it would take a pretax charge of $260 million correlation to the move.

After loss making quarter’s result, Darden’s shares slide to $44.70 in after-hours trading after closing down 0.5 percent, or 23 cents, at $46.85 on the New York Stock Exc

Source Posted by: Rahulbhandari    Source

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