Olive Garden owner warns of losses
ORLANDO, Fla. -- Darden Restaurants, struggling to draw more customers into its Olive Garden and Red Lobster restaurants, predicted a third-quarter profit Friday that was below Wall Street's expectations and cut its outlook for the year.
The Orlando, Fla.-based chain has tried to revamp menus and marketing for its flagship chains. But revenue at Olive Garden, Red Lobster and LongHorn Steakhouse locations open at least one year is expected to fall 4.5 percent in the quarter ending Feb. 24, indicating those efforts have yet to pay off.
"We recognize there is still more to do to further address affordability and to improve other important aspects of the guest experiences we provide," said CEO Clarence Otis in a statement, adding that re-establishing growth at the three chains was Darden's top priority.
Otis said the first half of the fiscal third quarter was "encouraging," but higher payroll taxes and rising gas prices, along with severe winter weather, sent sales sliding in February.