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Gene Lee, CEO of Olive Backyard Father or mother, to Retire

Gene Lee, CEO of Olive Backyard Father or mother, to Retire

Olive Backyard’s dad or mum firm

Darden Eating places Inc.

DRI -4.33%

stated that

Gene Lee,

the chief govt who has led the corporate by means of the pandemic and oversaw robust gross sales development throughout his tenure, plans to retire subsequent 12 months.

Mr. Lee, who has led Darden for about seven years, will step down on the finish of Might, the corporate stated.

Ricardo Cardenas,

the corporate’s chief working officer, shall be Mr. Lee’s successor. Mr. Lee, 60 years previous, plans to proceed to serve on Darden’s board of administrators in a nonexecutive capability, Darden stated.

Darden shares fell 4.3% to round $140.77 Friday morning, paring losses from an 8% drop earlier within the session. The inventory continues to be up by about 18% because the begin of 2021.

Since Mr. Lee took over as CEO in 2015, whole returns for Darden’s inventory have been about 1.5 instances these of the broader S&P 500 index. Mr. Lee has been with Darden since 2007, when the corporate acquired RARE Hospitality Worldwide, the place Mr. Lee was serving as president.

Mr. Lee’s successor, Mr. Cardenas, is 53 years previous. He joined Darden as an hourly worker in 1984 earlier than rising by means of the ranks of the corporate’s finance division. Mr. Cardenas grew to become the corporate’s finance chief in 2016 and was promoted to president and chief working officer earlier this 12 months.

Within the newest quarter, the second of Darden’s 2022 fiscal 12 months, same-restaurant gross sales elevated by 34% in contrast with a 12 months in the past, earlier than vaccinations had arrived to stem the unfold of Covid-19. However Darden’s up to date revenue forecast for the subsequent six months was decrease than Wall Avenue had been anticipating.

Darden stated it expects adjusted per-share earnings of $7.35 to $7.60 on gross sales of $9.55 billion to $9.7 billion in fiscal 2022, which ends in Might. Inventory analysts had been forecasting adjusted earnings of $7.62 a share on gross sales of $9.54 billion, in line with FactSet’s survey.

Within the three months by means of November, Darden’s earnings have been $193.2 million, or $1.48 a share, in contrast with earnings of 73 cents a share a 12 months in the past. Analysts had been forecasting earnings of $1.43 a share this quarter.

The corporate posted a loss within the quarter that resulted in Might 2020, however has in any other case remained worthwhile by means of the pandemic. Gross sales within the newest quarter, at $2.27 billion, have been about 10% larger than in the identical stretch of 2019, earlier than the pandemic hit.

Navigating larger prices shall be an essential focus for Darden within the coming months amid economywide considerations about inflation. The corporate is aiming for its pricing to be about 3% larger total within the 12 months by means of Might. Executives stated on a convention name Friday morning that Darden plans to benefit from its scale to maintain the tempo of menu–value will increase beneath the broader inflation fee.

Darden can be rushing up the tempo of deliberate wage will increase. Beginning in January, hourly employees will earn a minimal of $12 an hour together with suggestions, a stage that Darden had beforehand deliberate to succeed in in January 2023. The upper minimal wage will imply that its restaurant employees will earn about $20 an hour on common, the corporate stated.

Eating places have confronted broad labor shortages this 12 months as some employees have moved on from pre-pandemic careers within the business. Some stayed away due to Covid-19 associated considerations, whereas others have taken the prospect to hunt larger wages and advantages in different industries.

Along with Olive Backyard, Darden owns the LongHorn Steakhouse, the Capital Grille, Yard Home, Eddie V’s and different restaurant manufacturers.

Write to Matt Grossman at

Copyright ©2021 Dow Jones & Firm, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

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