Dive Brief:
- Eugene Lee Jr., chairman of the board at Darden since 2021, will not seek reelection at the company’s annual meeting of shareholders in September, according to a press release issued Thursday. Following Lee’s retirement, the board will be composed of nine rather than 10 members.
- Lee led Darden as CEO from February 2015 to May 2022, according to the company. Prior to serving as CEO, Lee was president and chief operating officer for a year.
- Lee’s departure was announced the same day as Darden’s results for FY2023, which include modest increases in same-store sales. The company also saw average weekly restaurant sales reach $111,673, surpassing pre-COVID levels of $96,542, across Darden’s segments.
Dive Insight:
Lee’s departure comes as Darden is experiencing growth in both units and sales. Darden’s systemwide sales grew by 8.9% in FY2023, driven by a 6.8% increase in same-store sales and net openings of 47 restaurants, which grew Darden’s unit count 2.5% to 1,914 restaurants.
Most of the company’s 2023 same-store sales increase was driven by menu price hikes. On Darden’s Q3 earnings call, Chief Financial Officer Raj Vennam said the company estimated its total price increases for FY2023 would reach 6% to 6.5%. Same-store sales growth was weakest for the company’s fine dining segment, which saw 5.7% total growth in the year, and a 1.9% decline in Q4, according to the most recent earnings release. At the time of Darden’s Q3 call, Vennam said the company’s traffic trends were stable.
In the press release announcing his retirement, Lee said the company was in a solid position for future growth. Darden’s position has been strengthened by strategic acquisitions during Lee’s tenure as CEO and later chairman. Earlier this year, Darden acquired Ruth’s Chris Steakhouse in a $715 million deal. The acquisition was completed without additional debt. The company bought Cheddar’s Scratch Kitchen in a significant deal in 2017.
