Red Lobster 2010 Annual Report Download - page 13

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DARDEN RESTAURANTS, INC. | 2010 ANNUAL REPORT 11
New Unit and Same-Restaurant Sales Growth
Our proven portfolio of brands provides significant opportunities to grow
by both adding new restaurants and increasing same-restaurant sales.
•฀Red Lobster is poised for same-restaurant sales growth as a
result of its multi-year brand repositioning work – which will be
capped by a remodel program that brings together the brand’s
promise of a refreshing seaside dining experience. The brand
opened four net new restaurants in fiscal 2010, and new unit
growth will continue at modest levels over the next few years as
the brand focuses on maximizing the pace of its remodel program.
Eventually, we believe sufficient expansion potential exists for
Red Lobster to add at least 100 new restaurants.
•฀Olive Garden continues to deliver on its promise of providing
guests with an idealized Italian family meal. It opened 32 net
new units in fiscal 2010 and plans to continue expanding its base
of high-volume, high-return restaurants by adding 30-35 new
restaurants per year for the next few years. Ultimately, we believe
Olive฀Garden฀has฀the฀capacity฀for฀an฀additional฀175-225฀
restaurants. And as it expands, this powerful brand is well
positioned to continue to drive industry-leading same-restaurant
sales growth.
•฀LongHorn Steakhouse opened 10 net new restaurants in fiscal
2010 and has a significant opportunity to expand its restaurant
base now, and over the long term, to become a nationally
advertised brand on a scale with Red Lobster and Olive Garden.
LongHorn, which promises to help guests unwind and savor a
great steakhouse meal served with genuine western hospitality,
plans to open 20-25 new restaurants in fiscal 2011 – which
includes expanding its presence in new markets such as Texas,
Arkansas and Louisiana – and is likely to accelerate the pace of
expansion in the following few years. Enhanced brand positioning
work and the completion of its remodel program are also expected
to drive meaningful same-restaurant sales growth, leading to
appreciably higher average unit volumes.
New Business Growth
We continue to explore meaningful sources of new growth beyond
our current brand portfolio. These may include such non-traditional
opportunities as international expansion and synergy restaurants
(pairing two brands in a single building with distinct dining rooms but
a shared kitchen and restaurant management team), as well as the
acquisition of additional brands.