Darden Earnings Miss Analyst Estimates

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Sept. 20 (Bloomberg) -- Julie Hyman reports on Darden Restaurants earnings on Bloomberg Television's "In The Loop." (Source: Bloomberg)


What you're seeing in the casual dining industry is a lot of deals being offered to get customers in the door.

A couple things are happening.

First, darden restaurants, all of garden, red lobster -- they have been offering discounts since the recession.

That helped them out at first.

Now everyone is doing it, so there is a lot of competition for the customers to get in the door.

There is increased competition in deals.

And it is hurting margins.

If you are offering all these deals, you're going to get squeezed.

Earnings down 22%, and the earnings-per-share missing estimates by about $.17. definitely seeing some problems.

Olive garden same-store sales down about 4%. red lobster down 5%. pretty tough at red lobster.

Seafood is a problem for darden restaurants?

Cepheid is a problem because the costs have been going up.

If you look -- seafood is a problem because the costs have been going up.

If you look at shrimp, a could account for 10% of overall costs of goods sold.

Shrimp prices have been going through the roof.

There have been issues with supply coming out of asia.

When you are a chain known for its endless shrimp promotions and costs are going up, it can

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