Shakeup At Darden Aims To Save $20 Million; Shares Up 2%
Darden Restaurants Inc. announced a shake-up late Tuesday, closing its aviation business and cutting down on management layers at its flagship chain restaurant Olive Garden. The changes will bring about $20 million in annualized cost savings for the company, it said. The goal is to win market share and improve same-restaurant sales and profits, Darden added. For this fiscal year, the company said it expects about $10 million of savings, which will mitigate rising costs in dairy, beef, and other commodities. Darden, which also operates the LongHorn Steakhouse and Capital Grille chains, last month named Gene Lee its interim CEO, after shareholders voted to replace Darden's entire board with directors nominated by Starboard Value LP, the company's second-largest shareholder. Shares of Darden rose 2% in after-hours trading.
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