Barrington Capital 80 Pg Presentation On Value Creation At Darden

Barrington Capital 80 Pg Presentation On Value Creation At Darden
By . The original uploader was Kalel2007 at English Wikipedia (Source: Extracted from a PDF file by Kalel2007) [Public domain], via Wikimedia Commons

Barington Capital Group, L.P. (“Barington”) is an investment firm that, through its affiliates, manages a value – oriented, activist investment fund that was established by James A. Mitarotonda in January 2000.

See background of story here- Barington Intensifies Activism To Push Changes At Darden Restaurants

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Barington’s principals and senior advisors have significant experience working with publicly traded companies to design and implement initiatives to improve long – term shareholder value.

Barington has substantial expertise investing in branded consumer companies, including restaurants, retail and apparel companies.

  • Prior investments include Lone Star Steakhouse, Dillard’s, The Jones Group, Lancaster Colony, Pep Boys and Warnaco

Barington represents a group of shareholders that currently owns over 2% of the outstanding shares of Darden Restaurants, Inc. (NYSE:DRI) (“Darden” or the “Company”)

Executive Summary: About Darden

Darden Restaurants, Inc. (NYSE:DRI) is one of the world’s largest publicly traded full service restaurant companies

As of Darden Restaurants, Inc. (NYSE:DRI)’s most recent annual report, the Company operated 2,138 restaurants in the United States and Canada, including:

– 828 Olive Garden restaurants

– 705 Red Lobster restaurants

– 430 LongHorn Steakhouse restaurants

– 49 The Capital Grille restaurants

– 44 Yard House restaurants (acquired in 2012)

– 33 Bahama Breeze restaurants

– 31 Seasons 52 restaurants

– 12 Eddie V’s Prime Seafood restaurants

Olive Garden and Red Lobster represents 72% of the Company’s LTM revenue

Darden Restaurants, Inc. (NYSE:DRI) owns more real estate than its peers, including the land and buildings on 1,048 properties and the buildings on 802 ground leased sites

Darden Has Underperformed

Darden Restaurants, Inc. (NYSE:DRI) has underperformed its peers in total shareholder return (“TSR”) over the past one-, three – and five – year periods

Darden Restaurants, Inc. (NYSE:DRI)’s EBITDAR margin has been in decline since FY2011 and is below the average of its peers, despite having one of the largest revenue bases in the industry

Darden Restaurants, Inc. (NYSE:DRI) has not captured economies of scale or synergies from acquisitions – SG&A as a percent of revenue has been flat over the tenure of its current CEO despite Darden’s significant growth through acquisitions

Darden Restaurants, Inc. (NYSE:DRI)’s expensive promotional strategy has failed to stem declining same-store-sales at its core brands, Red Lobster and Olive Garden

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