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Tuesday, August 26, 2008

Olive Garden Warns

by Calculated Risk on 8/26/2008 08:27:00 PM

Another casual dining chain feels the pinch ...

From the WSJ: Olive Garden's Parent Warns on Profit

A surprise warning on earnings by Darden Restaurants Inc. suggests that sit-down restaurants will continue struggling through the fall after a dismal summer.
"The environment was weaker this quarter than it's been for a while," Darden Chief Executive Clarence Otis said in an interview. Asked how the overall industry will perform during the next few months, he said "We're not counting on it getting a whole lot better."

In coming months, restaurants are expected to close more locations, build fewer new ones, offer more low-priced promotions and tighten worker scheduling to contain labor costs ...
emphasis added
Just more evidence that the 2nd half recovery has been cancelled.