Darden Restaurants, Inc.

Good morning. Welcome to the Darden fiscal year 2023 fourth quarter earnings call. Your lines have been placed on listen only until the question and answer session. To ask a question, you may press star one on your touchtone phone. As a reminder, the conference is being recorded. If you have any objections, please disconnect at this time. I will now turn the call over to Mr. Kevin Kalachek. Thank you. You may begin.

Thank you, Daryl. Good morning, everyone, and thank you for participating on today's call. Joining me today are Rick Cardenas, Darden's President and CEO, and Raj Vinam, CFO. As a reminder, comments made during this call will include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations and projections. Those risks are described in the company's press release, which was distributed this morning, and in its filings with the Securities and Exchange Commission. We are simultaneously broadcasting a presentation during this call, which is posted in the investor relations section of our website at Darden.com. Today's discussion and presentation includes certain non-GAAP measurements, and reconciliations of these measurements are included in the presentation. Looking ahead, we plan to release fiscal 2024 first quarter earnings on Thursday, September 21st, before the market opens, followed by a conference call. During today's call, any reference to pre-COVID when discussing fourth quarter performance is a comparison to the fourth quarter of fiscal 2019, and any reference to annual pre-COVID performance is a comparison to the trailing 12 months ending February of fiscal 2020. Additionally, all references to industry results today refer to Black Box Intelligence's casual dining benchmark excluding Darden, specifically Olive Garden, Longhorn Steakhouse, and Cheddar Scratch Kitchen. During our fourth fiscal quarter, industry same-restaurant sales decreased 0.7%, and industry same-restaurant guest counts decreased 7%. And during our full fiscal year 2023, industry same restaurant sales increased 2.7%, and industry same restaurant guest counts decreased 5.5%. This morning, Rick will share some brief remarks recapping the fiscal year. Raj will provide details on our fourth quarter and full year financial results and share our fiscal 2024 financial outlook. And then Rick will close with some final comments. Now, I'll turn the call over to Rick.

Thank you, Kevin, and good morning, everyone. We had a solid quarter to conclude what was a very strong year. Despite a tough environment, we significantly outperformed the industry benchmarks for same restaurant sales and traffic and met or exceeded the financial outlook we provided at the outset of the year. For the full fiscal year, we grew sales by 8.9% to $10.5 billion, delivered diluted net earnings per share of $8 and opened 57 new restaurants. We also opened nine new international franchise restaurants in six different countries, which is the most we have ever opened in a fiscal year. The market responded positively to our performance, leading to a total shareholder return of 32.6 percent for the fiscal year. We have consistently delivered strong, long-term shareholder returns. In fact, since Darden was spun off from General Mills 28 years ago, a period which spans multiple business cycles, the company has achieved an annualized TSR of 10% or greater over any 10 fiscal year period. Our restaurant teams continue to execute at a high level by remaining focused on our back-to-basics operating philosophy anchored in food, service, and atmosphere. Our brand's ongoing efforts to drive execution through simplification enable our restaurant teams to create great guest experiences as evidenced by record-level performance we saw from many of our brands on key holidays throughout the year. Nowhere is it more apparent than at Olive Garden, which achieved the highest sales day and sales week in their history during the week of Mother's Day. This focus on being brilliant with the basics leads to strong guest satisfaction scores, and our internal guest satisfaction metrics remain at or near all-time highs across our brands. At Longhorn Steakhouse, one of their most important metrics is their Steaks Grilled Correctly score, which is at an all-time high. To continue to drive these results, Longhorn recently completed their sixth Steak Master Series, which is their annual grilling competition and training program. Over the course of two months, thousands of culinary team members competed in this highly engaging training program for the right to be crowned champion and receive the $15,000 grand prize. Congratulations to this year's Stakes Master's Champion, Kylie Hall from the Longhorn Steakhouse in Farragut, Tennessee. I am particularly proud of everything the teams in our restaurants and at the support center accomplished in fiscal 2023. For example, Olive Garden successfully introduced Never Ending Pasta Bowl, which leveraged their iconic brand equity, was much simpler to execute, and significantly improved margin, while still providing tremendous value for their guests. Throughout the year, several of our brands ranked number one among major casual dining brands in key measurement categories within Technomics Industry Tracking Tool, including Longhorn for food quality and Cheddar Scratch Kitchen for value. And several of our brands were recognized as industry leaders in employment practices by Black Box Intelligence. Olive Garden, the Capitol Grill, and Seasons 52 were honored with the Employer of Choice Award, and Longhorn and Eddie V's received the Best Practices Award. Throughout fiscal 2023, our strategy served us well. In addition to our back-to-basics operating philosophy driving strong execution in our restaurants, Darden's four competitive advantages of significant scale, extensive data and insights, rigorous strategic planning, and results-oriented culture enabled our brands to compete more effectively and provide even greater value to their guests. Our significant scale allowed our teams to successfully manage through the highly unpredictable inflationary environment while continuing to underprice inflation over the long term. All four of our advantages are unmatched within the restaurant full-service industry. These advantages are leveraged by our portfolio of iconic brands, all generating high average unit volumes with extensive geographic footprints. Our strategy is the right one for our company, and our advantages were further strengthened last week with the completion of the acquisition of Ruth's Chris Steakhouse. Ruth's Chris enhances our scale advantage, fits our culture, and complements our portfolio of iconic brands. We are so thrilled to add such an outstanding brand and high caliber talent. and our experienced team is working hard to integrate Ruth Chris into Darden with as little disruption as possible. I'm proud of the results we achieved in fiscal 2023, and we will continue to execute our strategy to drive growth and long-term shareholder value. Now I will turn it over to Raj.