www.nrn.com/financial.aspx?id=373922 -
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Published on: 10/5/2009
Last Visited: 10/6/2009
Jeffrey Bernstein, Barclays Capital
Bernstein suggested that cost-savings would remain the primary earnings driver for casual-dining companies in the months ahead, rather than a hoped-for sales recovery.
“Restaurant investors [specifically casual-dining] approached Darden’s [first-quarter] release with high expectations, awaiting validation that comp trends were seeing slow but steady improvement of late, taking pressure off cost-saving initiatives that are likely more limited,†he noted. “Unfortunately, Darden was unable to deliver such a message, and effectively reminded investors that any such hint of industry comp improvement is likely attributable to aggressive discounting, which will pressure margins and damage respective brand long-term health and market share.â€