Darden Restaurants, Inc.

Welcome to the Darden Fiscal Year 2024 First 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, then one on your touchtone phone. This conference is being recorded. If you have any objections, please disconnect at this time. I will now turn the call over to Mr. Kevin Calica. 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 include certain non-GAAP measurements, and reconciliations of these measurements are included in the presentation. Looking ahead, we plan to release fiscal 2024 second quarter earnings on Friday, December 15th, before the market opens, followed by a conference call. During today's call, any reference to pre-COVID when discussing first quarter performance is a comparison to the first quarter of fiscal 2020. Additionally, all references to industry results during today's call refer to Black Box Intelligences, Casual Dining Ben Smart, excluding Darden, specifically Olive Garden, Longhorn Steakhouse, and Cheddar Scratch Kitchen. During our first fiscal quarter, industry same restaurant sales increased 0.9%, and industry same restaurant guest counts decreased 4.2%. This morning, Rick will share some brief remarks on the quarter, and Raj will provide details on our financial results. Now, I'll turn the call over to Rick.

Good morning, everyone. Thanks, Kevin. We had a strong quarter as we continued to outperform the industry benchmarks for same restaurant sales and traffic. For the quarter, Total sales were $2.7 billion, an increase of 11.6%, and adjusted diluted net earnings per share were $1.78. We also opened 10 new restaurants in nine different states during the quarter. Our ability to drive profitable sales growth is a testament to the strength of our business model and adherence to our strategy. We continue to strengthen and leverage our four competitive advantages of significant scale, extensive data and insights, rigorous strategic planning, and a results-oriented culture, while our restaurant teams remain intensely focused on executing our back-to-basics operating philosophy anchored in food, service, and atmosphere. This focus on being brilliant with the basics continues to drive strong guest satisfaction. In fact, our internal guest satisfaction metrics remain at or near all-time highs across all our brands. Additionally, several of our brands continue to rank number one among major casual dining brands in key measurement categories within Technomics Industry Tracking Tool, including Longhorn Steakhouse for food quality and taste and Cheddar Scratch Kitchen for value. Our team members bring our brands to life each day, and we know engaged team members are vital to creating great guest experiences. That's why our brands are focused on leveraging their unique cultures to strengthen team member engagement. For example, Longhorn Steakhouse created the Grillmaster Legends program that honors grillmasters who have grilled more than 1 million steaks throughout their career, which typically takes more than 20 years for a team member to accomplish. Five Grillmaster Legends were honored during the quarter, bringing the total to 25 team members who have received this recognition. Also during the quarter, Yardhouse completed its first Best on Tap competition. Known for having more than 130 beers on tap, Yardhouse tested its bartenders from every restaurant, giving them the opportunity to showcase their beverage knowledge, bartending expertise, and service skills. Congratulations to this year's winner, Alyssa Hurley, from the Yardhouse in Willow Grove, Pennsylvania, who was named Best on Tap. Programs like these give us an opportunity to celebrate team members who play a critical role in the guest experience and who serve as torchbearers for their brand's culture. One of the most significant ways our brands drive culture is through their annual leadership conferences. which provide the opportunity to get in front of every general manager and managing partner across all our restaurants to discuss the plans for the year and generate excitement among our operators. I was pleased to see the high levels of engagement and strong alignment on what our restaurant teams must do to continue creating exceptional guest experiences across each of our iconic brands. To further strengthen our brands, we are focused on highlighting what makes each one unique. That's why, when it comes to marketing, any activity our brands undertake is evaluated through three filters. First, it needs to elevate brand equity by bringing the brand's competitive advantages to life. Second, it should be simple to execute. We will not jeopardize all the work we have done to simplify operations, which allows our teams to consistently deliver memorable guest experiences. And finally, it will not be at a deep discount. We are focused on providing great value to our guests, but doing so in a way that drives profitable sales growth. A great example of this activity was the Capitol Grill's Generous Pour event that took place during the quarter. This specially curated wine experience allows guests to sample award-winning wines that pair with items on the Capitol Grill menu. And in the second quarter, Olive Garden is bringing back Never-Ending Pasta Bowl, which brings to life its competitive advantage of never-ending, abundant, craveable Italian food. Olive Garden's eClub members received a special invitation to begin enjoying NEPB this week. This guest favorite returns for everybody on Monday and will be offered at the same price point as last year. Turning to Ruth's Chris. Since the day we announced the completion of the acquisition, we have been guided by three key objectives. First, we want to preserve the team member experience and the brand's unique culture. Ruth's Chris has many long-tenured team members, and we are committed to ensuring this is a people-focused process. The team is engaged, and we have strong buy-in across the executive and operations leadership levels, all of which helps ensure a smooth transition. Next, we want to maintain and even strengthen the guest experience. Ruth's Chris is an incredibly strong brand, and it ranks as one of the top brands across multiple metrics within Technomics Industry Tracking Tools. We now expect to realize more synergies than we originally anticipated, and we plan to reinvest some of them in the guest and team member experience. Raj will provide more details during his remarks. And last, we want to successfully migrate Ruth Chris under the Darden platform. The team leading the integration is wrapping up the planning stage, and we're about to embark on the hardest part, the actual conversion to new systems and processes. We know that it's not easy, which is why we plan to complete it in phases over the next nine months to limit disruptions as much as possible. Looking across our entire portfolio, I am pleased with the quarter. Our strategy is working. We continue to grow share, strengthen margins, and make meaningful investments in our business while returning capital to shareholders. And while I'm proud of our continued success, there is a larger purpose to what we do, and that is to nourish and delight everyone we serve. not just within the four walls of our restaurants, but in the communities that our guests and team members call home. September is Hunger Action Month, and we are uniquely positioned to help fight hunger. This marks the 20th anniversary of our harvest program. Since 2003, our restaurants have collected excess nutritious food that was not served to guests and prepared it for weekly donation to local nonprofit partners. Over the life of the program, we have donated the equivalent of more than 113 million meals. And for the past 13 years, we have partnered with Feeding America to help fight hunger. Over that time, the Darden Foundation has donated more than $16 million to support their network of more than 200 food banks. Last week, together with our partners Penske Truck Leasing and Lineage Logistics, we added 10 more refrigerated trucks for mobile food pantry programs at 10 local food banks. To date, we have added a total of 35 trucks across Feeding America food banks in 18 states. Our ability to make a difference in the fight against hunger would not be possible without the efforts of our 190,000 team members and their passion to nourish and delight everyone we serve. I'm grateful for everything you do to help make our company successful. Now, I will turn it over to Raj.