Olive Garden CEO Jean Lee retires


Olive Garden parent company

Darden Restaurant Ltd

DRI -4.96%

CEO Jean Lee, who overcame the pandemic and oversaw significant sales growth during his tenure, said he plans to retire next year.

Lee, who has led Darden for about seven years, will resign at the end of May, the company said. The company’s chief operating officer, Ricardo Cardenas, will succeed Lee. According to Darden, 60-year-old Lee will continue to serve in a non-executive position on Darden’s board of directors.

Darden shares fell 5% on Friday to $ 139.83. Inventories have increased by more than 17% since the start of 2021.

Since Lee took office as CEO in 2015, Darden’s total equity returns have been around 1.5 times higher than the broader S & P500 index.

Lee has been working in Darden since 2007, when he acquired Rare Hospitality International, where Lee was president.

Cardenas, Lee’s successor, is 53 years old. He joined Darden in 1984 as an hourly employee before being promoted to the company’s finance department. Cardenas was appointed Finance Officer of the company in 2016 and was promoted to President and Chief Operating Officer earlier this year.

In the latest quarter, the second quarter of Fiscal Year 2022 in Darden, sales of the same restaurant increased by 34%. Compared to a year ago, Stopped the Covid-19 epidemic before the vaccination arrived. However, Darden’s updated earnings forecast for the next six months was lower than Wall Street expected.

Darden said it expects adjusted earnings per share to be $ 7.35 to $ 7.60, while sales for 2022 ending in May will be between $ 9.55 billion and $ 9.7 billion. rice field. According to a FactSet study, equity analysts forecast adjusted earnings of $ 7.62 per share for sales of $ 9.54 billion.

In the three months to November, Darden’s revenue was $ 193.2 million, or $ 1.48 per share, compared to 73 cents a year ago. Analysts forecast revenue of $ 1.43 per share this quarter.

The company posted a loss in the quarter ended May 2020, but otherwise continues to make profits from the pandemic. Sales for the most recent quarter were $ 2.27 billion, an increase of about 10% over the same period in 2019 before the pandemic.

Navigating higher costs will be an important focus for Darden in the coming months amid economic overall concerns about inflation. The company aims to raise prices by about 3% overall in the 12 months to May. Executives said in a conference call Friday morning that Darden plans to use that scale to keep menu prices rising below a wider inflation rate.

Darden is also accelerating the pace of planned wage increases. Starting in January, hourly workers will earn at least $ 12 per hour, including tips. This is the level that Darden had previously planned to reach in January 2023. Higher minimum wages mean that restaurant workers earn about $ 20 an hour on average. The company said.

This year, restaurants are facing a wide range of labor shortages As some workers went ahead From a pre-pandemic career in the industry. Some have left due to concerns related to Covid-19, while others have had the opportunity to seek higher wages and benefits found in other industries.

In addition to the Olive Garden chain, Darden owns LongHorn Steakhouse, Capital Grille, Yard House, Eddie V’s and other restaurant brands.

Write to Matt Grossman matt.grossman@wsj.com

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Olive Garden CEO Jean Lee retires

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