Olive Garden’s parent company has spoken out to defend the business after hedge fund Starboard published an epic, 294-page takedown last week.
In Darden’s rebuttal, the company notes that company-wide sales for all its restaurants, which includes the Capital Grille, Longhorn Steakhouse and Bahama Breeze, are up.
However, Darden’s presentation doesn’t address Starboard’s most compelling argument — Olive Garden’s comparable restaurant sales have been falling for some time.
Here’s Darden’s characterization of sales, which shows company-wide sales going up. Note how many brands are included to demonstrate rising sales.
But Starboard notes that same-store sales at the core brand have declined considerably.
The company noted that traffic and sales were down in an earnings conference call last week.
Darden President and Chief Operating Officer Eugene Lee said the restaurant is relying on in-store makeovers and an expanded menu to improve business.
Darden’s response today lays out how some performance metrics are improving. But ultimately, it comes down to sales.
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