Olive Garden Boosts Darden

Olive Garden same-store sales soared 6.4%, on total sales of $618.4 million. It was the 45th consecutive quarter that Olive Garden posted positive comps, according to executives. The 568-restaurant chain opened 21 units since last year's second quarter.

Company executives say that they are testing two smaller Olive Garden prototypes that they will try out in urban markets in the fourth quarter. They plan to open between 25 and 30 new Olive Gardens next year.

One chain that did not meet expectations was Smoky Bones, the company's 117-unit barbeque concept. Year-over-year same-store sales fell 8.5%, and officials said they would temper Smokey Bones' expansion plans, opening 10 to 15 next year, down from this year's 25 to 30. "These results further emphasize the need to broaden the appeal of Smokey Bones," said Drew Madsen, Darden's president and chief operating officer, during the company's quarterly conference call.

Until Smoky Bones is turned around, Darden will not likely explore new concepts, says Clarence Otis, the company's chairman and CEO. "We need to do a lot of work to put ourselves in the position to pursue additional concepts whether they're internally-developed or acquired," he said, stressing that once the turnaround is complete, Darden would look at a new rollout or purchase.

Red Lobster, which had a two-unit drop over the last year brining it to 678 restaurants, posted a 3.4% same-store sales rise on revenues of $588.8 million. Caribbean-themed Bahama Breeze same-store sales grew 1.9% on sales of $36.3 million. The store count stayed flat at 32 units.

For the remainder of the fiscal year, Darden executives are forecasting earnings per share to increase 15% to 20% and same-store sales company-wide to grow 4% to 5%.