Darden Restaurants, Inc. has recently released its 10-K report, providing a detailed insight into its operations and financial performance. The company, based in Orlando, Florida, operates full-service restaurants under various brand names including Olive Garden, LongHorn Steakhouse, Cheddar's Scratch Kitchen, Yard House, The Capital Grille, Seasons 52, Bahama Breeze, Eddie V's Prime Seafood, and Capital Burger.
In its 10-K report, Darden Restaurants highlights the seasonality of its business, with sales volumes historically fluctuating throughout the year. Typically, average sales per restaurant are highest in the winter and spring, followed by the summer, and lowest in the fall. The company also notes that factors such as holidays, changes in the economy, severe weather, and similar conditions may impact sales volumes seasonally in some operating regions.
Darden Restaurants acknowledges the impact of inflation on its operations, particularly citing higher-than-usual inflation led by food and beverage costs and labor. The company mentions that it attempts to minimize the effects of inflation through appropriate planning, operating practices, and menu price increases. However, it also emphasizes that the extent to which inflation affects its restaurant profitability in future periods will depend on its ability and choice to continue offsetting the effects of inflation.
The 10-K report also delves into critical accounting estimates, emphasizing the significant judgment and uncertainty involved in preparing the company's consolidated financial statements. Darden Restaurants specifically highlights the critical nature of estimates related to leases, valuation of long-lived assets, goodwill and trademarks, unearned revenues, and income taxes.
Regarding liquidity and capital resources, the company states that cash flows generated from operating activities are its principal source of liquidity, used to finance capital expenditures for new restaurants, remodel and maintain existing restaurants, pay dividends, and repurchase shares of its common stock. Darden Restaurants also provides details about its credit ratings, commercial paper, and the terms of its Revolving Credit Agreement, which it entered into with Bank of America, N.A.
Additionally, the 10-K report discusses the company's senior unsecured $600 million 3-year Term Loan Credit Agreement, the issuance of $500 million aggregate principal amount of its 6.300 percent Senior Notes due 2033, and the subsequent payment in full of the outstanding amount under the Term Loan.
As a result of these announcements, the company's shares have moved -0.0% on the market, and are now trading at a price of $142.86. If you want to know more, read the company's complete 10-K report here.
