The Associated Press September 21, 2010, 7:13PM ET

Profit up for Red Lobster, Olive Garden's operator

Darden Restaurants Inc., which runs Red Lobster, Olive Garden and other chains, reported Tuesday that its first-quarter net income jumped 19 percent as revenue rose at its restaurants.

The company said it earned $113.1 million, or 80 cents per share for the quarter, compared with $94.3 million, or 67 cents per share in the prior quarter.

Darden's revenue grew 4.2 percent to $1.81 billion.

Analysts polled by Thomson Reuters expected the company to earn 77 cents per share for the quarter on revenue of $1.81 billion.

The company said sales at restaurants open at least a year grew 2.7 percent at Olive Garden and 2.2 percent at LongHorn Steakhouse. The figure declined 1.7 percent at Red Lobster. This is considered a key measure of performance because it exclude the impact of expansion or closing individual restaurants.

Darden said it expects the economy to remain challenging but reaffirmed its forecast for full-year net income per share to grow 14 to 17 percent. That translates into $3.26 to $3.35 per share -- in line with the $3.32 analysts are expecting.

The company also declared a quarterly dividend of 32 cents per share, payable Nov. 1 to shareholders of record as of Oct. 8.

Shares fell 92 cents, roughly 2 percent, to $44.02 in after-hours trading.


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