Darden Restaurants (DRI) Q4 2024 earnings summary

Executive summary

• Fiscal 2024 sales grew 8.6% to $11.4B, with adjusted diluted EPS up 11% to $8.88, exceeding guidance and driven by same-restaurant sales growth, 53–80 new restaurants, and the acquisition/integration of Ruth's Chris Steak House, which contributed $0.10 EPS accretion.

• 117 net new restaurants were added, including 8 reopenings and onboarding of 5,000 new team members from Ruth's Chris.

• Record guest satisfaction and strong team retention were achieved, supported by engagement programs and operational excellence.

• Leadership changes included new presidents for several brands and a new President of Business Development.

Financial highlights

• Q4 sales reached $3B, up 6.8% year-over-year, with adjusted diluted EPS of $2.65 and adjusted EBITDA of $523M.

• Restaurant-level EBITDA margin improved 120 bps to 19.9% for the year; Q4 margin was 20.9%.

• $1.1B returned to shareholders in FY24 via $628M in dividends and $454M in share repurchases.

• Operating income for FY24 was $1.36B (adjusted), with an effective tax rate of 12.6%.

• Annual same-restaurant sales: Olive Garden +1.6%, LongHorn +4.7%, Fine Dining -2.4%.

Outlook and guidance

• Fiscal 2025 sales expected at $11.8B–$11.9B, with 1%–2% same-restaurant sales growth and 45–50 new restaurant openings.

• Diluted net EPS guidance: $9.40–$9.60; annual dividend increased 7% to $5.60 per share.

• Capital spending projected at $550M–$600M; total inflation forecast at ~3% (2% commodities, 4% labor).

• Pricing expected to be in line with inflation (2.5%–3%), with modest increases throughout the year.

• Effective tax rate for FY25 expected around 13%.