Darden Plans to Add 36 New Restaurants to 1,139-Unit Chain

ORLANDO-Taking on more debt when the cash registers are ringing is only good business to Darden Restaurants Inc. The publicly-traded company is adding 36 new restaurants to its 1,139-unit chain over the next 12 months and remodeling another 153 locations. Darden is also scouting to buy another chain to add to its four-restaurant corral.

The Orlando-based firm plans to grow its 653-unit Red Lobster division by eight restaurants. The 469-unit Olive Garden group gets another 15 locations. Bahama Breeze, a 14-restaurant section, will be increased by 12 units. And the three-unit Smokey Bones BBQ property will add another restaurant.

On the renovation side, 120 Olive Gardens and 33 Red Lobsters will be redone.

Darden chairman/CEO Joe R. Lee justifies the expansion plans by noting the public’s appetite for dining out continues to widen even among speculation of a slowing economy. Lee spoke at the company’s annual meeting at the Renaissance Resort at SeaWorld.

Darden reported first-quarter profit of $56.9 million on sales of $1.02 billion, up from $47.3 million in net earnings on $929.4 million in sales for first quarter 1999. News of the firm’s record earnings jumped its stock on the New York Stock Exchange by 7.2% to $18.56, still below its 52-week high of $20.63.Besides it first-quarter profit, the company also has a total $500 million available for expansion–$150 million from the bond market and a $350 million shelf registration.