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Darden Falls as CEO to Retire, Wages to Go Up

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By Dhirendra Tripathi

Investing.com – Darden stock (NYSE:DRI) was down 5% Friday after the company said its Chief Executive Gene Lee will retire in May.

Gene will give way to current President and Chief Operating Officer Ricardo Cardenas while staying on as chairman. He was CEO for last seven years.

Also weighing on the stock was the restaurant chain accelerating its previous decision to hike wages. In January, minimum hourly earnings for Darden’s staff will be $12, gratuities included. Lee said the hike will translate into average hourly earnings of $20.

Total sales at the company rose 37% from last year to $2.27 billion, driven by a blended same-restaurant sales increase of over 34% and the addition of 34 restaurants on net basis. The restaurants benefited from vaccinations encouraging people out of their homes for dining and shopping.

Adjusted profit per share doubled to $1.48, and like sales, beat estimates.

That also gave the company the confidence to boost its guidance again. It now expects annual revenue to come in between $9.55 billion and $9.70 billion, up from the September guidance of $9.4 billion-$9.6 billion.

Same-restaurant sales are seen growing by 30% at center of its guidance range. It expects to open between 35 and 40 restaurants in the financial year that ends on May 30.

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