Darden Restaurant Financial Statements and Financial Ratios Analyzed from 2015 to 2019
Hey All,
Thanks for visiting my Darden Restaurant Financial Report page. On this page, you will be able to find preliminary information about Darden Restaurant's current financial performance as well as some historical track records and trends.
For a more detailed examination of Darden Restaurant's financial performance, please check out the "Financial Report". In this report, written by myself, Paul Borosky, MBA., Doctoral Candidate, and published author, you will find:
- Summarized income statement for the last 5 years.
- Summarized balance sheet for the last 5 years.
- Summary analysis by myself of important income statement, balance sheet, and financial ratio trends and other happenings.
- Five year’s worth of over twenty common financial ratios presented with formulas, calculations, and analysis tips for each ratio.
- Line by line description, explanation, and analysis tip for most financial statement line items and financial ratios.
- Professional financial analysis tips provided in each section to help YOU conduct your OWN financial analysis!
- Each section includes an “in other words” segment. This is were I use plain English to explain concepts.
Enjoy the preliminary information and for a more detailed analysis, buy the financial report!
Sincerely,
Paul Borosky, MBA.
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Sample Financial Report
Darden Restaurant: Brief Summary
Dardent Restaurant's home headquarters is located in Orlando, FL. The company competes in the Restaurant industry. Specifically, in the consumer cyclical sector.
At present, Darden employs about 185,000 employees in several countries. The CEO is Eugene Lee.
From a financial perspective, Darden's stock price has ranged between 26.15 to 128.41 in the last 52 weeks. Their market cap is about $7.7 billion. The beta for the company is 1.06. This indicates that the firm's riskiness is about on par with the overall market. On a quarterly basis, the company pays out in dividends about .88 a share.
Darden Restaurant Financial Report Sources
“Darden Restaurant Inc. 2019 Company Analysis… For Beginners: Financial Statements and Financial Ratios: Defined, Discussed, and Analyzed for 5 Years” was written by, Paul Borosky, MBA. and owner of Quality Business Plan. In this report, the author selected Darden's 2019 10k, 2017 10k annual report, 2016 10k annual report, Darden's 2015 10k annual report, and Darden's 2014 10k annual report as the basis for information gathering. Once all Darden's 10k annual statements were collected, the author then inserted Darden's s income statement information and Darden's balance sheet information into a customized financial template.
Darden Restaurant’s Income Statement – Summary Analysis
In this section, I walk through a broad definition as to what an income statement is and why it is important. From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail. After each line item is defined and discussed, I finally offer a summary analysis of Darden Restaurant's important income statement line item trends from 2015 to 2019, in most cases.
Revenue Growth: Darden’s growth rate for 2017 and 2016 was 3.4% and 2.5% prospectively. In 2018, the growth rate jumped up to 12.7%. Finally, in 2019, the growth rate moderated at 5.3%. If the company can maintain a 6% growth rate, which is the last five years average, then this will indicate that the firm is exceeding industry averages for revenue growth.
COGS: The organization’s cost of goods sold has averaged an annual growth rate of approximately 3.8%. This is well below the company’s revenue growth rate. This shows that the firm is not only doing an excellent job with negotiating prices for raw materials. But, if price increases are warranted from raw material cost, then the organization has little issue with passing on the price increase to their customers.
Darden Restaurants Income Statement 2019 |
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| Column1 | 2019 | 2018 | 2017 | 2016 | 2015 |
| Revenues | 8,510 | 8,080 | 7,170 | 6,933 | 6,764 |
| COGS | 2,412 | 2,303 | 2,070 | 2,039 | 2,085 |
| Gross Profit | 6,098 | 5,777 | 5,100 | 4,894 | 4,679 |
| SG&A | 405 | 409 | 387 | 384 | 430 |
| Depreciation | 336 | 313 | 272 | 290 | 319 |
| R & D | - | - | - | - | - |
| Other | - | - | - | - | - |
| Operating Expenses | 7,677 | 7,313 | 6,492 | 6,311 | 6,396 |
| EBIT | 832 | 766 | 677 | 622 | 175 |
| Other Income | - | ||||
| Interest Expense | 50 | 161 | 40 | 172 | 192 |
| EBT | 782 | 605 | 637 | 450 | 175 |
| Taxes | 64 | 2 | 154 | 90 | (21) |
| Net Income | 713 | 596 | 479 | 375 | 709 |
| Tax Rate | 8.1% | 0.3% | 24.2% | 20.0% | -12.0% |
Section 2: Darden Inc. Balance Sheet Analyzed from 2014 to 2019
For Darden Restaurant's balance sheet, I again go through each important line item from the balance sheet. In reviewing each line item, I will define Darden's balance sheet line item, such as cash, property, plant and equipment, and liabilities between 2015 to 2019. Next, I then offer a summary analysis of Darden’s important balance sheet line items.
Cash: Darden’s cash position has ranged from $535 million to $146 million in the last five years. In 2019, their cash position was 457 million. This shows that the firm is maintaining a cash balance closer to their high end as compared to low.
Accounts Receivable: In the last four years, Darden has continually increased its Accounts Receivables. In 2016, the organization ended its Accounts Receivable at $64 million. This figure had grown moderately to $88 million in 2019. The growth of their Accounts Receivable may be due to the organization offering some of their proprietary products for retail store sales at grocery stores. As this trend continues, investors should expect a moderate increase in this line item for the foreseeable future.
Darden Restaurants Summary Balance Sheet 2019 |
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| Column1 | 2019 | 2018 | 2017 | 2016 | 2015 |
| Cash | 457 | 146 | 233 | 274 | 535 |
| Short Term Investment | - | - | - | - | - |
| Account Receivable | 88 | 83 | 75 | 64 | 78 |
| Inventory | 207 | 205 | 178 | 175 | 163 |
| Other | - | - | - | - | - |
| Current Assets | 893 | 553 | 587 | 820 | 1,056 |
| Net PPE | 2,553 | 2,429 | 2,272 | 2,041 | 3,215 |
| Goodwill | 1,184 | 1,183 | 1,201 | 872 | 872 |
| Other | - | - | - | - | - |
| Total Assets | 5,893 | 5,469 | 5,292 | 4,583 | 5,995 |
| Accounts Payable | 333 | 277 | 249 | 242 | 199 |
| Accrued Expense | 175 | 177 | 149 | 135 | 141 |
| Accrued Taxes | 12 | - | 2 | - | 13 |
| Notes Payable | - | - | - | - | - |
| LT Debt - Current | - | - | - | - | 15 |
| Other | - | - | - | - | - |
| Total Current Liabilities | 1,474 | 1,384 | 1,289 | 1,187 | 1,197 |
| LT Debt | 928 | 926 | 936 | 440 | 1,452 |
| Other | - | - | - | - | - |
| Total Liabilities | 3,500 | 3,274 | 3,190 | 2,630 | 3,661 |
| Common Stock | 1,685 | 1,631 | 1,614 | 1,502 | 1,405 |
| Treasury | - | (8) | (8) | (8) | (8) |
| Retained Earnings | 807 | 658 | 560 | 548 | 1,026 |
| Other | - | - | - | - | - |
| Total Equity | 2,393 | 2,195 | 2,102 | 1,952 | 2,334 |
| Total Equity & Liability | 5,893 | 5,470 | 5,292 | 4,583 | 5,995 |
Section 3: Darden Inc. Financial Ratios Analyzed from 2014 to 2019
For this section, I have chosen about 16 different financial ratios to review for Darden Restaurant Inc from 2014 to 2019. In reviewing each of Darden's financial ratios, I first start with defining the financial ratio. Next, I supply the financial formula for calculating the specific ratio. Finally, I offer a brief analysis of important Darden's Financial ratios.
Darden's Current Ratio
Darden’s current ratio has ranged between .4 and .88. In 2019, their current ratio was .61. For most industries, the optimal current ratio would be 1.0 or higher. However, in industries with high cash flows such as restaurants and retail stores, lower current ratios have become a trend. From this, the organization seems to have adequate short-term funding to cover its short-term liabilities.
Darden's Total Asset Turnover
Darden’s total asset turnover ended in 2015 at 1.13. Over the next five years, the company improved upon its total asset turnover ratio. This resulted in a 1.44 total asset turnover in 2019. To continue this trend, the organization must continue to optimize the usage of all assets, which includes short-term as well as fixed.
Darden's Return on Assets
Darden’s return on assets has steadily increased over the last four years. This means that the company is making more money on fewer assets. In 2016, their return on assets was 8.18%. 2019 ended with the company at 12.1%. To ensure that this trend continues, the company may increase its tables available at restaurants or design business strategies to increase its per table turnover.
Darden's Debt Ratio
Darden has systematically been reducing its long-term debt. In 2015, the organization had approximately $1.4 billion in long-term debt. As of 2019, their deposition fell to $928 million. Also, their debt ratio within the same timeframe had fallen from 24% to 15%. Typically, restaurants often carry a debt load of approximately 50%. This means that the firm could possibly increase its debt position. By doing this, not only will this improve the company’s return on equity but they will also be gaining tax benefits from the increased interest expense write-offs.
Darden Restaurants 2019 Liquidity Ratios |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Current Ratio | 0.61 | 0.40 | |||
| Cash Ratio | 0.31 | 0.11 | |||
| Quick Ratio | 0.47 | 0.25 | |||
| Net Working Capital | 232 | (20) | |||
Darden Restaurants 2019 Asset Utilization |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Total Asset Turnover | 1.44 | 1.48 | |||
| Fixed Asset Turnover | 3.33 | 3.33 | |||
| Days Sales Outstanding | 3.77 | 3.75 | |||
| Inventory Turnover | 41.11 | 39.42 | |||
| Accounts Receivable Turnover | 96.70 | 97.35 | |||
| Working Capital Turnover | 36.68 | (404.01) | |||
| AP Turnover | 25.56 | 29.17 | |||
| Average Days Inventory | 0.11 | 0.11 | |||
| Average Days Payable | 0.07 | 0.08 | |||
Darden Restaurants 2019 Profitability Ratios |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Return on Assets | 12.10% | 10.90% | |||
| Return on Equity | 29.80% | 27.16% | |||
| Net Profit Margin | 8.38% | 7.38% | |||
| Gross Profit Margin | 71.66% | 71.50% | |||
| Operating Profit Margin | 9.78% | 9.48% | |||
| Basic Earning Power | 14.12% | 14.01% | |||
| ROCE | 18.83% | 18.75% | |||
| Capital Employed | 4,419 | 4,085 | |||
| ROIC | 27.44% | 31.70% | |||
| Market Measures | |||||
| Price/Earning Ratio | #DIV/0! | ||||
| Earnings per common Share | - | - | - | - | - |
| Dividend Payout | |||||
| MVA | |||||
| EVA | |||||
Darden Restaurants 2019 Long-term Debt |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Debt Ratio | 15.75% | 16.93% | |||
| Debt/Equity | 38.78% | 42.19% | |||
| Times Interest Earned | 16.64 | 4.76 | |||
| 2019 | 2018 | 2017 | 2016 | 2015 | |
| FCF | 510 | 880 | |||
| NOPAT | 764 | 764 | |||
| Operating Capital | 2,785 | 2,409 | |||