Darden 3Q profit tops Street, revenue comes in a bit light

MarketsAssociated Press

Darden Restaurants, owner of Olive Garden, LongHorn Steakhouse and other restaurants, reported strong third-quarter profits, though revenue was just shy of Wall Street expectations.

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Shares dropped more than 3 percent in Thursday premarket trading.

For the three months ended Feb. 25, Darden Restaurants Inc. earned $217.8 million, or $1.73 per share. A year earlier the Orlando, Florida-based company earned $165.6 million, or $1.32 per share.

Stripping out certain items, earnings were $1.71 per share. That easily beat the $1.64 per share that analysts surveyed by Zacks Investment Research expected.

Revenue rose to $2.13 billion from $1.88 billion, bolstered by the addition of 154 Cheddar's Scratch Kitchen restaurants and some other new restaurants. But the results were a bit short of the $2.15 billion that analysts polled by Zacks were looking for.

Sales at Olive Garden restaurants climbed 3.7 percent during the quarter, while sales at LongHorn Steakhouse locations increased 4.3 percent.

Darden raised its fiscal 2018 adjusted earnings forecast, citing its year-to-date performance and anticipated results for the fourth quarter. The company now anticipates full-year adjusted profit in a range of $4.75 to $4.80 per share. Its prior guidance was for $4.70 to $4.78 per share. Analysts polled by FactSet predict $4.76 per share.

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Elements of this story were generated by Automated Insights using data from Zacks Investment Research. Access a Zacks stock report on DRI at https://www.zacks.com/ap/DRI