XML 42 R16.htm IDEA: XBRL DOCUMENT v3.19.2
Segment Information
 12 Months Ended
May 26, 2019
Segment Reporting [Abstract]  
Segment Information SEGMENT INFORMATION

We manage our restaurant brands, Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, Yard House, The Capital Grille, Seasons 52, Bahama Breeze and Eddie V’s in North America as operating segments. The brands operate principally in the U.S. within full-service dining. We aggregate our operating segments into reportable segments based on a combination of the size, economic characteristics and sub-segment of full-service dining within which each brand operates. We have four reportable segments: (1) Olive Garden, (2) LongHorn Steakhouse, (3) Fine Dining and (4) Other Business.

The Olive Garden segment includes the results of our company-owned Olive Garden restaurants in the U.S. and Canada. The LongHorn Steakhouse segment includes the results of our company-owned LongHorn Steakhouse restaurants in the U.S. The Fine Dining segment aggregates our premium brands that operate within the fine-dining sub-segment of full-service dining and includes the results of our company-owned The Capital Grille and Eddie V’s restaurants in the U.S. The Other Business segment aggregates our remaining brands and includes the results of our company-owned Cheddar’s Scratch Kitchen, Yard House, Seasons 52 and Bahama Breeze restaurants in the U.S and results from our franchise operations. For periods prior to fiscal 2018, this segment also included results from our consumer-packaged goods sales. Beginning with the first quarter of fiscal 2018, the results from consumer-packaged goods are included in net sales of the associated brand, primarily Olive Garden.

External sales are derived principally from food and beverage sales. We do not rely on any major customers as a source of
sales, and the customers and long-lived assets of our reportable segments are predominantly in the U.S. There were no material transactions among reportable segments.

Our management uses segment profit as the measure for assessing performance of our segments. Segment profit includes revenues and expenses directly attributable to restaurant-level results of operations (sometimes referred to as restaurant-level earnings). These expenses include food and beverage costs, restaurant labor costs, restaurant expenses and marketing expenses (collectively, restaurant and marketing expenses). The following tables reconcile our segment results to our consolidated results reported in accordance with GAAP:

(in millions)
 
Olive Garden
LongHorn Steakhouse
Fine Dining
Other Business
Corporate
Consolidated
At May 26, 2019 and for the year ended
 
Sales
 
$
4,287.3

$
1,810.6

$
605.9

$
1,806.6

$
—

$
8,510.4

Restaurant and marketing expenses
 
3,403.3

1,486.3

478.3

1,548.8

—

6,916.7

Segment profit
 
$
884.0

$
324.3

$
127.6

$
257.8

$
—

$
1,593.7

 
 
 
 
 
 
 
 
Depreciation and amortization
 
$
140.8

$
68.2

$
33.4

$
94.3

$
—

$
336.7

Impairments and disposal of assets, net
 
8.9

0.3

—

10.3

(0.5
)
19.0

Segment assets
 
1,063.7

972.5

902.8

2,090.6

863.2

5,892.8

Purchases of land, buildings and equipment
 
187.3

65.6

49.1

147.2

2.8

452.0

(in millions)
 
Olive Garden
LongHorn Steakhouse
Fine Dining
Other Business
Corporate
Consolidated
At May 27, 2018 and for the year ended
 
Sales
 
$
4,082.5

$
1,703.2

$
574.4

$
1,720.0

$
—

$
8,080.1

Restaurant and marketing expenses
 
3,262.8

1,402.1

457.4

1,464.7

—

6,587.0

Segment profit
 
$
819.7

$
301.1

$
117.0

$
255.3

$
—

$
1,493.1

 
 
 
 
 
 
 
 
Depreciation and amortization
 
$
132.9

$
65.7

$
31.5

$
83.0

$
—

$
313.1

Impairments and disposal of assets, net
 
2.0

1.5

0.1

—

(0.2
)
3.4

Segment assets
 
1,020.7

974.2

872.9

2,058.9

542.9

5,469.6

Purchases of land, buildings and equipment
 
163.4

76.1

32.1

119.5

4.9

396.0

(in millions)
 
Olive Garden
LongHorn Steakhouse
Fine Dining
Other Business
Corporate
Consolidated
At May 28, 2017 and for the year ended
 
Sales
 
$
3,938.6

$
1,622.2

$
535.6

$
1,073.8

$
—

$
7,170.2

Restaurant and marketing expenses
 
3,176.8

1,341.3

430.6

891.8

—

5,840.5

Segment profit
 
$
761.8

$
280.9

$
105.0

$
182.0

$
—

$
1,329.7

 
 
 
 
 
 
 
 
Depreciation and amortization
 
$
123.3

$
65.1

$
29.1

$
55.4

$
—

$
272.9

Impairments and disposal of assets, net
 
(1.5
)
(0.1
)
—

(6.2
)
(0.6
)
(8.4
)
Purchases of land, buildings and equipment
 
131.4

54.1

41.1

62.7

3.7

293.0


Reconciliation of segment profit to earnings from continuing operations before income taxes:
 
Fiscal Year Ended
(in millions)
May 26, 2019
 
May 27, 2018
 
May 28, 2017
Segment profit
$
1,593.7

 
$
1,493.1

 
$
1,329.7

Less general and administrative expenses
(405.5
)
 
(409.8
)
 
(387.7
)
Less depreciation and amortization
(336.7
)
 
(313.1
)
 
(272.9
)
Less impairments and disposal of assets, net
(19.0
)
 
(3.4
)
 
8.4

Less interest, net
(50.2
)
 
(161.1
)
 
(40.2
)
Earnings before income taxes
$
782.3

 
$
605.7

 
$
637.3