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Operating Successfullyin a New Era

DARDEN SECURITY ANALYSTS MEETING | FEBRUARY 2013

Agenda

Monday, February 252:00 p.m. Matthew Stroud

VP, Investor Relations, Darden Restaurants

2:05 p.m. Clarence Otis, Jr.Chairman & CEO, Darden Restaurants

2:35 p.m. Drew MadsenPresident & COO, Darden Restaurants

3:35 p.m. Break4:00 p.m. Chris Chang

SVP, Technology Strategy, Darden Restaurants

Agenda

Monday, February 254:20 p.m. Brad Richmond

CFO, Darden Restaurants

5:05 p.m. Q&A

5:50 p.m. Adjourn

6:15 p.m. Buses Depart for dinner at Red Lobster – Lake Buena Vista

8:15 p.m. Buses return to Hotel

Forward-Looking StatementDuring the course of this presentation, Darden Restaurants’ officers and employees may make forward-looking statements concerning the Company’s expectations, goals or objectives. Forward-looking statements regarding our expected earnings per share and U.S. same-restaurant sales for the fiscal year, new restaurant growth and all other statements that are not historical facts, including without limitation statements concerning our future economic performance, plans or objectives, are made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any forward-looking statements speak only as of the date on which such statements are made, and we undertake no obligation to update such statements to reflect events or circumstances arising after such date. We wish to caution investors not to place undue reliance on any such forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties that could cause actual results to materially differ from those anticipated in the statements. The most significant of these uncertainties are described in Darden's Form 10-K, Form 10-Q and Form 8-K reports (including all amendments to those reports). These risks and uncertainties include food safety and food-borne illness concerns, litigation, unfavorable publicity, risks relating to public policy changes and federal, state and local regulation of our business including health care reform, labor and insurance costs, technology failures, failure to execute a business continuity plan following a disaster, health concerns including virus outbreaks, intense competition, failure to drive sales growth, failure to successfully integrate the Yard House business and the additional indebtedness incurred to finance the Yard House acquisition, our plans to expand our newer brands like Bahama Breeze, Seasons 52 and Eddie V’s, a lack of suitable new restaurant locations, higher-than-anticipated costs to open, close or remodel restaurants, a failure to execute innovative marketing tactics and increased advertising and marketing costs, a failure to develop and recruit effective leaders, a failure to address cost pressures, shortages or interruptions in the delivery of food and other products, adverse weather conditions and natural disasters, volatility in the market value of derivatives, economic factors specific to the restaurant industry and general macroeconomic factors including unemployment and interest rates, disruptions in the financial markets, risks of doing business with franchisees and vendors in foreign markets, failure to protect our service marks or other intellectual property, a possible impairment in the carrying value of our goodwill or other intangible assets, a failure of our internal controls over financial reporting, or changes in accounting standards, and other factors and uncertainties discussed from time to time in reports filed by Darden with the Securities and Exchange Commission.

Reconciliation of Non-GAAP Financial Measures

In addition to disclosing financial results calculated in accordance withU.S. generally accepted accounting principles ("GAAP"), this presentation contains non-GAAP financial measures. The non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, however, they are provided as management believes they are helpful in evaluating the state of the business. The non-GAAP financial measures may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. Other financial and statistical information in this presentation, including any information required by Regulation G, is available under the heading “Investor Relations” on our website at www.darden.com.


Clarence OtisChairman & CEO


Our Strategic Direction

7

INDUSTRYLEADERSHIP

IMPORTANTCHANGES FOR

A NEW ERA

CompetitivelySuperior ValueGoing Forward

Our Strategic History:HARD EARNED INDUSTRY LEADERSHIP

8

Pioneered National Casual Dining

• Grounded in talented and engaged restaurant and …eventually … multi-restaurant leaders …

• Increasingly robust people managementsystems and techniques …

• And increasingly effective guest countforecasting and cost management tools

9

Strong Restaurant-Level Operations


• Rooted in a commitment from the startto rigorous consumer insight …

• Which drove consistently in-synch evolutionof key consumer touch points …

• Including menus, advertising, servicestyle and restaurant look and feel …

• And combining that with effectiveuse of promotions and in-restaurantmerchandising

10

Strong Brand Management


• Reflects a commitment from the start to ongoing investmentin creating a robust Supply Chain …

• A highly functional Information Technology infrastructure …

• And strong financial management and reporting systems

11

Effective and Efficient Support

Pioneered Multi-Brand Casual Dining

• Well beyond what was possible with a single brand … since there are relatively few units before a full service dining brand reaches full national penetration

• A critical success factor was establishing appropriate leadership structures and teams … at the enterprise level andat each brand …

• Which allowed us to manage the added scale and scope of being multi-brand … and maintain strong restaurant operations and brand management

12

Enabled Significant Value Creating Growth

Pioneered Multi-Brand Casual Dining

• With two national brands and a growing portfolio …

• Achieved new levels of financial and operating scale compared to single brand operators …

• Which has been an important driver of competitively superior long-term shareholder value creation

13

Enabled Significant Value Creating Growth

Track Record of Decisive Action

• In the 1970’s and 1980’s … helped pioneer shrimp and fish aquaculture … preserving Red Lobster’s ability to offer everyday price accessibility over the long-term

• In the 1980’s … disposed of several brands to focus on Olive Garden’s compelling expansion and value creation potential

14

A Key to Sustained Long-Term Momentum

1970’s 1980’s 1990’s

Track Record of Decisive Action

• In the 1990’s … aggressively closed restaurants to address overbuilding at Red Lobster and in the industry

• In 2007 … disposed of Smokey Bones and acquired LongHorn Steakhouse and Capital Grille … to create a brand portfolio with a much stronger overall growth profile

• In 2011 and 2012 … enhanced our sales and earnings growth potential by acquiring Eddie V’s and Yard House

15

A Key to Sustained Long-Term Momentum

2000’s 2010’s

Consistently Willing and Able to Invest for the Future

• General Mills funded ourinvestment for the futureinitially … but for decades nowwe have relied on our ownconsiderable cash flow

• We’ve invested through capitalspending and … when necessary …operating expense and margin choices

• Beyond financial resources … our most important investment for the future has long been organizational capacity

16

Foundation for All Other Leadership Attributes

Our Strategic Direction:BLENDING CONTINUITY AND CHANGE

TO MAINTAIN LEADERSHIP

17

Committed to a Multi-Brand Future

• Our current portfolio supports continued market share growth for the next decade … without additional brands …

• As well as competitively superior returns …

• Provided we make the changes that are needed to manage the new scale and scope of our business …

• And that are needed to craft and deliver the guest experiences required to take advantage of the New Era

18

Our Path for Sustained Long-Term Value Creation

The New Era

• Many guests are more financially stretched than ever …and more focused than ever on affordability

• Many other guests remain financially comfortable …and are demanding better quality offerings

• The financially comfortable are affecting the tastes and preferences of the financially stretched … so financially stretched guests want more for less

19

Key Consumer and Competitive Dynamics

The New Era

• There are more millennial and multicultural guests than ever … and they are having a significant affect on the tastes and preferences of all guests

• Competition within Full-Service has increased … as eroding traffic fuels a more intense market share battle

• Competition within Full-Service has also increased because some brands are replicating promotional and operational approaches that have been successful at Darden

20


The New Era

• Competition with other restaurant segments has also increased … driven by innovation within traditional quick service …

• As well as the continued emergence of segments like quick service retail and fast casual

21


Operating Successfully in the New Era

• Our Specialty Restaurant Group brands provide Darden witha broader overall guest and occasion base

• To more effectively support our three large brands, we have established separate, dedicated teams that each focus more singularly on:– Winning more consistently in the marketplace today … or …– Redefining our guest experiences for tomorrow

22

We’re Making Needed Changes


• To more consistently win in the marketplace today… new, dedicated teams are focused on …

• More competitive promotional affordability …

• Better in-restaurant delivery of our current guest experiences …

• And richer, more targeted and more agile day-to-day guest communication

23



• To redefine the guest experiences we offer … new, dedicated teams are focused on …

• Big multi-year efforts that strengthen … in step change ways … the loyalty and visit frequency of current guests … or add new guests…

• By meaningfully reshaping our core menus … in-restaurant experiences … and how we engage guests and employees who are living increasingly digital lifestyles

24



• We are tempering check average growth noticeably going forward … to support traffic growth

• We are significantly reducing new restaurant expansionat Olive Garden …– So the brand can better focus on regaining same-restaurant momentum …– And the guest experience changes needed to sustain success

25



• We are also investing in …– A select few multi-year initiatives to ensure sustained success …– Transitioning to the new healthcare landscape in a way that maintains

strong employee engagement …– Lobster aquaculture … which will preserve Red Lobster’s ability to offer

everyday price accessibility over the long-term

• While our strategic choices will result in lower near-term sales and earnings growth targets …

• They are the appropriate choices for the business … and we have the resources to pursue them

26


Strong Collective Experience and Expertise

A Cost-Effective Support Platform

We Are Well-Resourced for the Needed Changes

27

Significant and Durable Operating Cash Generation

SustainedIndustry Leadership &

Superior Value Creation

As We Make the Needed Changes … Darden’s Winning Culture Will Not Change

28

The best, now and for generations…and a placewhere people can achieve their dreams

Nourish and Delight Everyone We Serve

Integrity & Fairness | Respect & Caring | Diversity | TeamworkAlways Learning, Always Teaching | Being “of Service” | Excellence

Grounded in Shared Purpose Identity and Values

Important Confirmation thatOurs is a Winning Culture

29

In service industries, employees’ “actions with consumers transforma company’s brand aspirations…intoa customer-experienced brand.”

Professor Leonard L. Berry

2011 | 2012 | 2013


Drew MadsenPresident & COO


The New Era

Key Dynamics– Industry, Consumer, Competitive

Implications for Darden– Compete more effectively within the current Casual Dining market share contest today– While also working aggressively to ensure our brands win the contest for relevance

tomorrow that goes beyond Casual Dining

Our Response– Further strengthened brand portfolio– Further strengthening organization capabilities– Making near term changes to regain momentum in our large brands– Advancing a focused set of high potential growth initiatives

2

3

Key Dynamics

Total Restaurant Industry Traffic Declining

4

Source: NPD CREST

QSR Less Retail & Fast Casual

62.3 Billion Visits 60.5 Billion Visits2008 2012

QSR RetailFast CasualMidscaleCasual DiningFine Dining / Upscale Hotel

38.0

7.8 2.0 7.17.0

0.4

37.1

8.0 2.4 6.26.4

0.4

Shifts from Full Service to Fast Casual and QSR Retail

Casual Dining Traffic Still Contracting

6.26.2

6.4 6.4

6.66.7

6.9 6.9

7.0

6.9

6.7

6.6

6.4

5.6

5.8

6.0

6.2

6.4

6.6

6.8

7.0

7.2

FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12

Bill

ions

5

+1.1%

-2.1%

Avg Growth = +1.6% Avg Growth = -2.1%

+2.3%

+0.5%+2.9%

+1.5%

+2.5%

+0.4%

+1.9%

-2.8%

-1.6%-2.0%

Source: NPD CREST; Total System Traffic; Restated History on PCYA Basis

Total Casual Dining Traffic

RISING TIDES SHARE BATTLE

Casual Dining Penetration and Frequency are Both Opportunities

77%

75%73%

69%66%

FY08 FY09 FY10 FY11 FY12

9.2

8.7 8.78.2

7.5


Source: Darden i-Tracker

Casual Dining Visit Frequency(Last Four Weeks)

Casual Dining Penetration(Last Four Weeks)

6

Casual Dining Less Affordable for Many

7

Source: NPD CREST & US Census Bureau, Population DivisionNote: 12 Months ending Sep’07 and Sep’12

Share of Traffic by Income

< $60,000 $60,000-$100,000 >$100,0002007 2012 2007 2012 2007 2012

U.S. Population 55% 58% 23% 22% 22% 20%

C.D. Total 38% 33% 29% 28% 32% 39%

The Reduction in Segment Affordability has Affected Our Brands More Because of Their Broader Reach

8


Share of Traffic by Income

< $60,000 $60,000-$100,000 >$100,000

2007 2012 2007 2012 2007 2012

U.S. Population 55% 58% 23% 22% 22% 20%

C.D. Total 38% 33% 29% 28% 33% 39%

CD Major Chains 38% 38% 30% 29% 32% 33%

51% 43% 26% 29% 23% 28%46% 40% 30% 32% 24% 28%

35% 32% 30% 33% 35% 35%

Though Broader Reach is a Key Driver of Superior Revenues Per Restaurant

Casual Dining Not Capturing Millennial Opportunity

9


Share of Traffic by Age

Millennials Gen X Boomers Matures

2007 2012 2007 2012 2007 2012 2007 2012

U.S. Population 31% 33% 22% 23% 30% 30% 17% 14%

C.D. Total 25% 24% 24% 24% 31% 35% 20% 17%

Casual Dining Not Fully CapturingHispanic Opportunity

10

Source: NPD CREST & US Census Bureau, Population DivisionNote: 12 Months ending May’07 and May’12 considered

Share of Traffic by Ethnicity

Caucasians African American Hispanics Others

2007 2012 2007 2012 2007 2012 2007 2012

U.S. Population 67% 65% 12% 12% 15% 17% 6% 6%

C.D. Total 75% 75% 8% 7% 12% 13% 5% 5%

However… Major Casual Dining Chains are Growing…

11

1.9%

-2.1%-2.8%

-1.6% -2.0%


Total Casual Dining

Source: NPD CREST

4.0%

-2.4% -2.7%

0.3%1.4%


Major Chains

Total Traffic% + / - LY

… And Taking Market Share

12

Share of Total Traffic

Source: NPD CREST

52%

15%33%

2008

51%

14%35%

2012

Independents (<3 units)

Small Chains (3-200 units)

Major Chains (200+ units)

Source: NPD Crest

Cum

. Per

cent

Cha

nge

vs. Y

ear A

go

Our Large Brands Have Been Growing FasterThan Major Chains

13

5.6%

10.1%

4.0%

0.6%

-2%

0%

2%

4%

6%

8%

10%

12%


Darden Blended Major Chains

Cumulative Total Traffic% + / -

Darden Blended Average (RL, OG, LH)

We Also Have Higher Average Unit Volumes…

14

$4.7

$3.8

$3.0

$3.9

$3.2

$3.0

$3.0

$2.8

$2.4

$1.8

Source: Competitors: Form 10-K Filings, 2012 Nation’s Restaurant News Top 100 Report

AUV$Millions

Darden: Fiscal 2012

(Dinner Only)Primary MajorChain Competitors(Sales of $1Billion plus 250 units)

Higher Restaurant Level Returns…

15

18.5%

17.9%

17.6%

15.5%

10.3%

NA

Source: Competitors: Form 10-K Filings; Darden: Fiscal 2012

Restaurant-LevelReturns (%)*

* Restaurant-Level Returns (%) = (EBIT + G&A + Depreciation & Amortization) / Total Revenue, as reportedDine Equity not included - not comparable due to high level franchising activity.

Primary MajorChain Competitors(Sales of $1Billion plus 250 units)

(Partly Franchised)

(Partly Franchised)

And Darden Has Higher Operating Profit Margins…

16

9.2%

8.5%

8.4%

4.5%

0.4%

NA

Source: Competitors: Form 10-K Filings; Darden: Fiscal 2012

EnterpriseEBIT (%)*

* Enterprise EBIT (%) = (Net Income + Interest Expense + Income Taxes) / Total Revenue, as reported

Primary MajorChain Competitors(Sales of $1Billion plus 250 units)

(Partly Franchised)

(Partly Franchised)

Which Reflects Significant Productivity Gains

17

Cumulative SavingsFY09-FY13($ millions)

Supply Chain Automation $41 - $44

Facilities Centralization $9 - $10

Sustainable Operating Practices $24 - $26

Labor Optimization $46 - $50

Total $120 - $130

But... Same-Restaurant Traffic Has Been a Challenge

18

‐20%

0%

20%


Cumulative Same-Restaurant Traffic% +/-

Darden Blended

Major Chains

Darden Blended Average (RL, OG, LH)

-7.7%

-18.2%

And We Have Lagged the Industry Recently

-4.5%

-2.6%

-4.5%

-2.2%

-0.8%-1.4%

Q4 FY12 Q1 FY13 Q2 FY13

Quarterly Same-Restaurant Traffic% +/- Prior Year

Darden Blended Average (RL, OG, LH) Knapp Track (Ex. DRI)

19

20

Implications for Darden

Winning the Market Share Contest Today

Winning Today– Address the more intense market share contest within Casual Dining …

• Further strengthen in-restaurant delivery of our guest experiences• And respond more aggressively to the elevated guest need for affordability• While being careful not to cheapen the guest experiences we offer

Winning Tomorrow– Address larger contest for relevance beyond Casual Dining …

• Innovate and redefine our guest experiences• To take advantage of changing guest preferences• And effectively address increased competition … within Casual Dining and

Limited Service segments as well

21

Requires tempering near-term check average growth and making other important investments

While Redefining Our Guest Experiences for Tomorrow

Major Chain Share Gain Within Casual DiningReflects Aggressive Increase in Price Incentives

22

829.5 801.5 806.2 815.6 852.5 780.0 731.40%

5%

10%

15%

20%

25%

30%

0

100

200

300

400

500

600

700

800

900

YESep'06

YESep'07

YESep'08

YESep'09

YESep'10

YESep'11

YESep'12

277.4 307.4 360.1 469.1 500.9 567.5 566.80%

5%

10%

15%

20%

25%

30%

0

100

200

300

400

500

600

700

800

900

YESep'06

YESep'07

YESep'08

YESep'09

YESep'10

YESep'11

YESep'12

13%

25%

18% 18%

Traffic (000) on deal % of dealing

Source: NPD CREST

Major CD Chains Small and IndependentCD Chains

But Casual Dining Guest Experience is Not Improving Fast Enough

23

% Excellent – Overall Experience

2526

28 29 30 30 30 30 3132 33 33

3132

36 3638 37 38

3638

3941 40

39 3841 41 41 41 41 40 40 41 42 41

45 45 45 45 4644 43 43 43

45 45 45

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Average Eater Check

Total Occasions

$27.41

$13.22$ 7.02

$ 5.13

+11 PT

+2 PT

+8 PT

Source: NPD CREST, YE May 2012

QSRQSR

Fast CasualFast Casual

Casual DiningCasual Dining

Fine DiningFine Dining

Making Price Premium to Other Segments… Even AfterDiscounting… Tougher to Justify

ServiceServiceAtmosphereAtmosphere

FoodFood

AdvertisingAdvertisingExecutionExecution

ValueValue

Guest Experience Levers to Sustain Great Brands

24

Business Performance

Attentive ServiceCleanlinessUp-to-date

Atmosphere I Like

Menu VarietyTaste of Food

Brand AwarenessAd Awareness

Consistently Good Experience

Value for the MoneyAffordability

Overall Brand Strength

Future Visit Intent

Our View

Sustaining Great Brands

Overall Brand Strength Rating (Future Visit Intent)– Red Lobster, LongHorn and Olive Garden have all moved up

Individual Attribute Ratings– Red Lobster is generally up in competitive ranking– LongHorn is generally flat or up– Olive Garden is generally flat but down slightly on a few attributes

Value for Money– The one exception where all three of our brands have moved down in ranking– Apparently driven more by “What You Pay” versus “What You Get”

25

Shifts in Guest Perception and Competitive Brand RankFY08-FY12

Taste of Food

26

B & G 4

B & G 3

B & G 2

B & G 1

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY08

B & G 4

B & G 3

B & G 2

B & G 1

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY12

Source: Darden i-Tracker – Top Box % Ranking

FY12 vs. FY08

One

Competitive Ranking

One

(“BIG DISCOUNTS”)


Distinctive Menu Items

27

B & G 4

B & G 2

B & G 3

B & G 1

CD Destination 1

CD Destination 3

CD Destination 2

CD Polished 1

FY08

B & G 4

B & G 2

B & G 1

B & G 3

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY12

One

One

One

One

One

One

FY12 vs. FY08Competitive Ranking




Consistently Good Experience

B & G 4

B & G 3

B & G 2

B & G 1

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY08

28

B & G 4

B & G 3

B & G 2

B & G 1

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY12

One

One

One

One





Attentive Service

B & G 4

B & G 3

B & G 1

B & G 2

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY08

29

B & G 1

B & G 3

B & G 4

B & G 2

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY12

Two

One

One

Two

Two

Two





Atmosphere I Like

B & G 4

B & G 2

B & G 3

B & G 1

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY08

30

B & G 4

B & G 2

B & G 1

B & G 3

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY12

Two

One

Two

One





Value for Money

31

B & G 4

B & G 3

B & G 2

B & G 1

CD Destination 3

CD Polished 1

CD Destination 2

CD Destination 1

FY08

B & G 4

CD Destination 3

CD Polished 1

B & G 3

B & G 1

B & G 2

CD Destination 2

CD Destination1

FY12

One

Two

Four

Four

Five

One

Three

Four

Three

One





Future Visit Intent

32

B & G 4

B & G 3

B & G 1

B & G 2

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY08

B & G 4

B & G 3

B & G 2

B & G 1

CD Destination 3

CD Destination 1

CD Destination 2

CD Polished 1

FY12

Two

Two

Three

One

Three

Three

One

One



(“BIG DISCOUNTS”) (“BIG DISCOUNTS”)

Sustaining Great Brands

We have made significant progress strengthening overall brand perception over the last several years at all three large brands– Although we have seen some erosion from a high level on a few individual

attributes at Olive Garden

However… our most financially constrained guests do not feel we are “in the game” from an affordability perspective … which keeps them from coming as much as they’d like– Negatively impacting our Value perception and near term sales momentum at

all three large brands

And… we still have opportunity to improve the guest experiences we offer for more financially secure guests, Millennials and Multiculturals

33

Guest Experience Levers

34

Our Response

Further Strengthened Our Brand Portfolio

Broaden exposure to financially secure guests plus Millennial andGen X guests

Add important capabilities related to music, on-trend food development and running a great bar

Contemporize overall portfolio

35

Specialty Restaurant Group

Projected sales of $1.0 Billion in FY13

Growing 17% to 19% annually

Funding its own growth

36

Now an Even Stronger Growth Profile

Further Strengthening Our Organization

Winning Today– New structure … and new teams … to ensure we maintain a strong foundation at

each brand … execute with excellence against our current strategies and standards … and make important changes in our go-to-market approach

Winning Tomorrow– New structure … and new teams … to ensure we redefine the guest experiences

we offer in a coordinated fashion across the enterprise– Leading to multi-year growth initiatives to strengthen visit frequency of current

guests and capture new guests for new occasions

37

Key Objectives

Further Strengthen Our Organization

38

Large Brand Leadership Structure (RL, OG, LH)

President

EVPOperations

SVP Finance

SVPHR

VP Development

EVPMarketing


39

EVP Operations(RL & OG – 7 SVPs)

(LH – 4 SVPs)

Old Structure

SVP Operations (Up to 13 Directors)

New Structure

Director of Operations (Up to 8 GMs)

General Manager (Leads Restaurant)

EVP Operations(RL & OG – 4 SVPs)

(LH – 2 SVPs)

SVP Operations (Winning Today and Tomorrow)

(3 to 5 MDs)

Managing Director(Winning Today)

(5 to 8 DOs)

Director of Operations (Winning Today)(Up to 8 GMs)

General Manager (Leads Restaurant)

Field Operations Organization (RL, OG, LH)


40

General Manager

Old Structure

Culinary Manager

Service Manager

Sales/Hospitality Manager

General Manager

New Structure

Culinary Manager

Service Manager

Staffing/Training Manager

(Winning Today)

Full Time Hourly Shift Leaders(Winning Today)

In-Restaurant Operations Organization (RL, OG, LH)


41

EVP Marketing

Old Structure

VP Consumer Insights

SVP Brand Marketing

SVP Culinary Beverage

EVP Marketing

New Structure

VP Consumer Insights

SVP Brand Foundation

(Winning Today)

SVP Brand Development

(Winning Tomorrow)

CorporateExecutive Chef(Culinary Innovation

for Today and Tomorrow)

Marketing Organization (RL, OG, LH)


42

EVP’sBrand

Marketing

New Structure

SVP BusinessInsights

SVP Brand

Innovation

VP InteractiveEcosystem

_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

_ _

_ _

Enterprise Marketing Organization (All Brands)

CMO

Adding Capability for the New Era

43

Brian FoyePresident,

Seasons 52

Harald HerrmannPresident,

Yard House

Craig CarlyleEVP Operations,

Yard House

Carlito JocsonExecutive Chef,

Yard House

Jim NuetziCorporate Exec. Chef

Olive Garden

Will SetliffChief Marketing Officer

Jose DuenasSVP, Brand Foundation

Olive Garden

John ConnellySVP Brand Foundation

LongHorn

Gopal KrishnanSVP, Brand Innovation

Jim TaylorSVP, Brand Dev.

Olive Garden

Sam MancusoSVP Brand Foundation

Red Lobster

Mike ChurchVP, Interactive Ecosystems

Chris ChangSVP, Technology

Strategy


20 years of Marketing experiencewith a retail focus

Joined Darden as EVP, Marketingfor Specialty Restaurant Group

Previously SVP Marketing, Target– Brand, Category and Storewide Marketing– Enterprise Strategy and Insights– Enterprise Innovation and Digital Marketing

44

Will SetliffChief Marketing Officer


26 years of restaurant industry experience

Previously CEO, Yard House before joining Darden

Worked in various capacities in a range of dining venues prior to helping launch the flagship Yard House inLong Beach, CA in 1996

45

Harald HerrmannPresident, Yard House


19 Years of IT & Strategy experience

Joined Darden as SVP, Technology Strategy and Innovation

Previously VP, Innovation & IT Strategy for Caesars Entertainment– Founded and led the innovation team

focused on developing new technologies across 50 casino properties worldwide

46

Chris ChangSVP, Technology Strategyand Innovation

Making Near Term Changes to Regain Momentum

47

Further Strengthen Guest Experience


48

Three Course Italian Dinner - $12.95

Elevate Emphasis on Affordability in Promotions


49

More Effective Advertising


50

Red LobsterBlack Friday Event

Olive GardenLighter Fare

Bahama BreezeLate Night Happy Hour Launch

More Aggressive Use of Digital and Social Media

More Fundamentally Evolve Our Guest Experiences

Identify and more quickly take advantage of key culinary trends as appropriate by brand

Prioritize culinary development against “platforms” that support multiple dishes and have the potential to drive step-change improvement in the breadth of our appeal

More consistently leverage our culinary expertise and resources across all the brands in the Darden portfolio

51

Redefine Our Food and Beverage Experience

Culinary Trends*

52

EMERGING PEAK DECLINE

Fresh Ingredients

Regional SourcingOrganic/Sustainable

Transparent PreparationCraft Anything

Healthful Kids’ Meals

New Cuts of Meat

Gluten-free cuisine

Half/Smaller Portions

High/LowRight PriceCustomizable

Share-ability / Tasting

Vegetable Main Dishes

Convenient for the Occasion

Allergen Sensitive

Value

Handheld Foods

To Go

Asian Inspiration

Latin Inspiration

Upscale Comfort Food

All You Can EatFood Trucks

SushiCupcakes

Panini

Barbecue

Soba Noodles

Buffet

Traditional French

*Culinary trends tend to fade and resurface in response to macro trends

Negronis

Chef-driven Cocktails

Low Alc Cocktails

Brandy

Beer Cocktails

Ice Clarity Southern Inspired Cocktails

Mezcal

Cosmos

Wellness

Culinary Trends*

53

Fresh Ingredients

Regional SourcingOrganic/Sustainable

Transparent PreparationCraft Anything

Healthful Kids’ Meals

New Cuts of Meat

Gluten-free cuisine

Half/Smaller Portions

High/LowRight PriceCustomizable

Share-ability / Tasting

Vegetable Main Dishes

Convenient for the Occasion

Allergen Sensitive

Value

Handheld Foods

To Go

Asian Inspiration

Latin Inspiration

Upscale Comfort Food

All You Can EatFood Trucks

SushiCupcakes

Panini

Barbecue

Soba Noodles

Buffet

Traditional French

*Culinary trends tend to fade and resurface in response to macro trends

Negronis

Chef-driven Cocktails

Low Alc Cocktails

Brandy

Beer Cocktails

Ice Clarity Southern Inspired Cocktails

Mezcal

Cosmos

Wellness

EMERGING PEAK DECLINE

Longhorn Steakhouse – Price/Value

Seasons 52 – Latin/Fresh/Handheld

Olive Garden – WellnessRed Lobster – Fresh

The Capital Grille – Customization /Value

Bahama Breeze – Latin/Shareable/Value

Trend-Inspired Culinary Innovation

54

Leveraging Scale and Expertise Across the Portfolio

Grilled Pork Veneto at Olive Gardenwas developed in a cross-conceptculinary “charette”

When one chef has an applicable concept,they share their learning to inspire others– Tacos began in Seasons 52 and Bahama Breeze,

then moved to Red Lobster

Improved bread recipes have moved from The Capital Grille and Seasons 52 to our larger concepts

55


56

Act More Like Restaurateurs– Less about systems and processes– More about passionate guest engagement– Leading to increased guest loyalty

Redefine Our Service Experience


57

Tableside Ordering and Settlement

Web Ahead Seating Targeting Marketing

Digital Guest Engagement


58

Guest Convenience Guest Segmentation


59

Remodels

More Fundamental Steps to Support Our Guest Experiences

60

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

0

50

100

150

200

250

300

350

400

450

500

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Popu

latio

n

Live

Wei

ght (

Mill

ions

of L

bs)

Historic World Supply Projected World Supply World Popluation

Global Demand for Lobster Projected to Exceed Supply

More Fundamental Steps to Support Our Guest Experiences

61

Lobster Aquaculture

Create the world’s first integrated lobster aquaculture park

Working in close partnership with the Malaysian government

Preserve the ability of Red Lobster to offer everyday price accessibility on a brand-defining product

We Are Investing in Needed Change

62

Direct P&L InvestmentsIT Platform, Organization Structure, Growth Initiatives, Lobster Aquaculture

0

10

20

30

40

50

60

70

80

90

100

FY10 FY11 FY12 FY13Direct Investment Tempered Check Growth

$15-20$8-12

$30-35

$70-75$

in M

illio

ns

Will be another $25-30 million of direct P&L investment in FY14 … as well as another $25-30 million of investment via tempered check growth

Making the Changes Required to Win in a New Era

Taking decisive action to regain momentum and position Dardento deliver competitively superior value creation going forward

Focused on important changes in several key areas including:– Organization capability– Guest experience affordability– Guest experience redefinition for the New Era

Making the investments required to implement these changes, protect the broad appeal of our brands and sustainably growsame-restaurant traffic

63

Darden’s Technology StrategyOur Technology Journey

Chris ChangSVP | Technology Strategy


Discussion Topics

• A Rapidly Changing Technology Environment

• Our Response and Vision

• Current Status of Our Technology Strategy Program

• Our Roadmap

2

A Rapidly Changing Technology Environment

3

Technology is rapidly changing & evolving…

3 YEARS AGO, NONE OF THESE EXISTED


4

…the vendor landscape is becoming increasingly complicated(and below is just the social media space)…

SOURC

E: Lum

aPa

rtne

rs


5

…and consumers are becoming more & more digitally reliant.

FEBRUARY 2010 FEBRUARY 2013

Facebook Users350,000,000 1,000,000,000

Tweets Per Day50,000,000 500,000,000+

US Text Messages Per Day5.1 billion 6.0 billion

Apps in App Store120,000 750,000

Yelp Monthly Visitors25,000,000 90,000,000+

Videos Viewed Per Month30 billion 181 billion

Emails Sent Per Day250 billion 325 billion


6

As consumers & technologies evolve, we have both an obligation and an enormous opportunity to change how consumers interact with our brands:

SMS Wait List

Tableside Ordering

Websites Vary Prices, DealsBased on Users' Information December 24, 2012

It was the same Swingline stapler, on thesame staples.com website. But forKim Wamble,

Targeted eCommerce

MobilePayments

Guest of the Future

Source: Henriksent

Technology Vision & Strategy

• Connecting guests and employeesto Darden in their digital world

• Deliver new brand relevant servicesand employee services anytime,anywhere on any device

• Manage guest relationships withinand across Darden brands

• Establish a trusted andextensible platform

7

Our vision is focused on building relationships & engaging with consumers & employees digitally…

Build relationships and loyalty by digitally engaging with guests and employees ontheir terms and leveraging insights to drive business performance

MARKET SHARE

Sales Building

Agile in Thought

and Action

Robust, Flexible & Scalable

People

Our Response to a Rapidly ChangingTechnology Environment

8

Given that it is impossible to predict how technology will evolve…

Source: SteamFan

…To This


9

…our strategy is to build a robust platform that allows usto respond to changes now & in the future

Next App Here

Websites To Go Web Ahead

Digital Menus Loyalty

From This…


10

We’ve made a few key strategic choices that inform our approach:

Guest DataWe will own & manage guest data as a strategic asset

Scalable PlatformWe will build a scalable platform that can support & scale across our portfolio of brands

IntegrationWe will integrate our platform within & across our restaurants to enable a seamless, cross-channel experience

Building On a Strong Foundation & Unique Strengths• Owned Restaurants • Strong IT Platform • Centralized Team• Multi-Brands

Current Status of Technology Strategy Program

11

This journey that we’re on is similar to that of building a house

Get Some Help

Find experts that can help you bring your vision to life

Define Wants

Write down on paper what you want your house to contain

Create Blueprint

Draft & architect the house blueprint & compliant design

Cost it Out

Get estimates for what house will cost to build & phasing for construction

Build the House

Begin constructing the house…starting with the foundation!

Inspect the House

Once it’s built, hire inspectors to make sure it’s A-OK

Define the Vision

Write down your dream house wish list & rough priorities

Move into the House

Move into the dream house…and over time enhance / renovate

Current Status of Technology Strategy Program

12

We our moving into the design phase of our program

Define Wants

REQUIREMENTS PHASE

Create Blueprint

DESIGN PHASEFY13

Cost it Out

IMPL PLANNINGFY13

Build the House

DEVELOPMENTFY13-FY14

Inspect the House

TESTING & QAFY14

Move into the House

GO LIVEFY14

Define the Vision

STRATEGY & VISION

Get Some Help

FIND PARTNERS

Technology Strategy Program: 3 Phases

13

Below are our phases of our program

PHASE 1Building Our

Foundation & Getting in the Game

PHASE 2Selectively

Innovating & Leading

PHASE 3Creating Sustainable

Competitive Advantage

Technology Strategy Program Journey

14

We will evolve in key areas such as the ones below:

AnalyticsSuperior Guest Data &

Analytics Insight

Insight into guest behavior on avisit-by-visit,

check-by-check basis

Enhanced & enriched views of guest activity in

our restaurants

Cross-brand insight into guests

across entire portfolio

Digital PlatformRobust Guest-Facing Technology Platform

Upgrading our guests’ digital experience on our

brand sites

Adding new applications on our sites that deliver guest value

Delivering cross-brand digital

experiences to our guests

Guest Relationships

Technology-Enabled Guest Relationship Management

Capturing guest opt-ins across all channels

Learning from our guests and getting smarter about their

preferences

Enabling cross-brand guest relationship

management

FROM TO

What Does Success Look Like?

15

We believe this journey will allow us to achieve the following:

• Rich digital experiences anytime, anywhere, on any device

• Access to new experiences & opportunities with our brands

For OurGuests

• Tools, data, and insight we need to better anticipate guest needs across our portfolio of brands

• Both new & more loyal guests who visit our brands more frequently

ForDarden

Financial Implicationsof Our Strategic Choices

Brad RichmondCFO


Agenda

1

FY13• Where Our Business is Today

Horizon• Our Near-Term Business Model

FY14• Preliminary Fiscal 2014 Variances

to the Near-Term Model

Agenda

2





What Fiscal 2013 Looks Like...

Total Annual Sales ≈ $8.5 billion

Operating Cash Flow ≈ $950 million

EBIT Margin ≈ 7.8%*

Fully Diluted EPS $3.06 to $3.22*

3* Including Yard House acquisition costs and purchase accounting adjustments

FY13

Yard House Acquisition Cost and Purchase Accounting Impacts:• Reduce EBIT Margin by approximately (30) bps• Reduce EPS by approximately ($0.09)

Unit Growth is Driving Sales Growth

4

Large Brands 85 4.5%

Specialty Restaurant Group* 15 13.6%

Total* 100 5.0%

* Excludes Yard House

FY13

New UnitsProjected

% GrowthProjected

While Same-Restaurant Results are Soft... Two Year Results are Solid Except at Olive Garden

5

Same-Restaurant SalesProjected

Current YearTwo-Year

Cumulative

Olive Garden -2% to -3% -3% to -4%

Red Lobster -2% to -3% +1.5% to +2.5%

LongHorn ≈ +1% ≈ +6%

Blended Large Brands -1.5% to -2.5% Flat

Specialty Restaurant Group* +1.5% to +2.5% ≈ +6.5%

* Excludes Yard House and Eddie V’s

FY13

Total Sales Growth is Also Supportedby the Eddie V’s and Yard House Acquisitions

6

Same-Restaurant Sales

Darden Blended -1.4% ≈ -4.5%* -0.5% to +1.5% -1.5% to -2.5%

Olive Garden -1.4% ≈ -4.0%

Red Lobster -2.6% ≈ -7.0%

LongHorn +1.5% ≈ -1.5%

Unit/Operating Weeks Growth +4.9% +5.2% +5.3% +5.0%

Yard House & EV’s Acquisitions +2.8% +4.1% +4.7% +3.6%

Other -0.4% +0.1% 0.0% -0.2%

Total Sales Growth +5.9% ≈ +4.5% +9.5% to +11.5% +6% to +7%

1st Half Q3 Full YearActual ProjectedProjected

Q4

* Year over Year 3rd Quarter Weather Impact estimated at -0.9%

FY13

We Have a Strong, Balanced Portfolio

7

Total Sales($B) Projected

% GrowthProjected

Olive Garden $3.7 2%

Red Lobster 2.6 -2%

LongHorn 1.2 10%

Specialty Restaurant Group 1.0 60%*

Darden $8.5 6% to 7%*

* Includes Yard House; excluding the Yard House acquisition, projected growth is 18% for the Specialty Restaurant Group and 3% to 4% for Darden overall.

FY13

Olive Garden 17+% $4.6Red Lobster 14 - 17% $3.8LongHorn 14 - 17% $3.0

The Capital Grille 17+% $6.8Seasons 52 17+% $6.3Yard House** 17+% $8.4Bahama Breeze 14 - 17% $5.6Eddie V’s 14 - 17% $6.2

BrandRestaurant Return

on Sales %*

AverageSales per Unit

($ Millions)

Despite Recent Challenges... Sales and ReturnLevels of Our Brands Remain Industry Leading...

8

* Includes marketing and depreciation expense and a credit that represents the implied interest in rent payment for leased units. Excludes rent averaging expense and direct new unit opening costs.

** Yard House presented on a Pro Forma basis

Trailing Four Quarters Ending Q2 FY13

FY13

Darden EBIT 8.8%

General & Administrative Expenses* 5.5%

Implied Lease Interest & Rent Averaging 1.7%

New Unit Direct Opening Expense 0.4%

Restaurant Earnings 16.4%

*Selling Expenses (Included as an expense in Restaurant Earnings) 4.6%

Roadmap From Earnings Before Interestand Taxes (EBIT) to Restaurant Earnings

9

Trailing Four Quarters Ending Q2 FY13

FY13

Our Portfolio Generates Substantialand Growing Operating Cash Flow

10

$0.00

$0.25

$0.50

$0.75

$1.00

03 04 05 06 07 08 09 10 11 12 13 Proj

$ Billion

Continuing Operations

Equates to Pre-Tax Cash Flow of ≈$535,000 per restaurant

FY13

Our Portfolio Generates Substantialand Growing Operating Cash Flow

11

$0.00

$0.25

$0.50

$0.75

$1.00

03 04 05 06 07 08 09 10 11 12 13 Proj

Adjusting for Significant Variances

Fiscal 2011 through Fiscal 2013 Operating Cash Flows reduced by Working Capital Usage related to Supply Chain Transformation and Debt Hedge Settlements ($22MM, $104MM, and $55MM, respectively)

FY13


$ Billion

Composition and Use of Operating Cash Flow

FY11 FY12 FY13Projected

Earnings $479 $477 $402 to $425Depreciation and Amortization 317 349 400Working Capital 12 (191) 90Other Cash Items 87 128 50

Operating Cash Flow $895 $762 $945 to $965

Capital Expenditures (548) (639) ($700 to $725)

Add-Back Acquisition Cost Impact - 1 10

Available for Dividends & Share Repurchase $347 $124 $230 to $275

12

($ in Millions)


FY13

We Deploy Our Capital to Protect AND GrowOperating Cash Flow...

13

Capital Expenditures $548 $639 $700 to $725New Restaurants 274 341 395

Maintenance Capital 135 146 148Remodeling 97 94 120 Relocations / Rebuilds 14 20 15

Technology 13 11 20All Other 15 27 17

FY12FY11 FY13Projected

($ in Millions)

FY13

Recession RecoveryRARE Acquisition

Pre-Acquisition$’s in Millions

YH Acquisition

$0

$250

$500

$750

$1,000

FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13

Dividends Share Repurchase Operating Cash Flow

Dividendsper Share $0.08 $0.08 $0.08 $0.40 $0.46 $0.72 $0.80 $1.00 $1.28 $1.72 $2.00

Share RepurchaseDollars perOutstanding Share

$1.25 $1.44 $1.99 $2.90 $2.59 $1.13 $1.05 $0.61 $2.82 $2.88 $0.40

Proj

Acquisition Debt Reduction

... And Are Clearly Committed to Returning Capital to Shareholders

14

Recession RecoveryRARE Acquisition

Pre-Acquisition$’s in Millions

YH Acquisition

$0

$250

$500

$750

$1,000

FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13

Dividends Share Repurchase Operating Cash Flow

Dividendsper Share $0.08 $0.08 $0.08 $0.40 $0.46 $0.72 $0.80 $1.00 $1.28 $1.72 $2.00

Share RepurchaseDollars perOutstanding Share

$1.25 $1.44 $1.99 $2.90 $2.59 $1.13 $1.05 $0.61 $2.82 $2.88 $0.40

Proj

Acquisition Debt Reduction

... And Are Clearly Committed to Returning Capital to Shareholders

15

$3.9 Billion Returned to Shareholders over 10 years

Even With Current Sales Challenges...New Unit Growth Remains Value Creating

16

Olive Garden

LongHorn

Seasons 52

Capital Grille

Bahama Breeze

Red Lobster(Relocations & Rebuilds)

140%

110%

145%

115%

135%

100%

Average NewUnit Sales

$4.2

$3.1

$6.3

$6.8

$5.5

$4.0

79

66

12

7

5

7

# New Units

150%+

150%

150%+

100%

100%

115%

Earnings as % of HurdlePrior Year Current Year

Fiscal 2011, 2012 and 2013 openings; cumulative performance through November Fiscal 2013

FY13

Experiencing Some EBIT Margin Contraction...Due to Sales De-Leveraging and Acquisition Costs

17

FY12 EBIT (Q1/Q2) 7.1%Sales De-Leveraging -50 bpsYard House Acquisition Costs & Lower % Margins -40 bpsChange in Fair Value of Benefit Programs -30 bps

(Fully offset in lower income tax rate for the year)

Incremental Selling Expenses -30 bpsOperating Productivity & Transformational Cost Initiatives +70 bps

FY13 EBIT (Q1/Q2) 6.3%

FY13

Current Fiscal 2013 Earnings Outlook

18

Earnings After Tax $145 $132 to $135 $125 to $144 $402 to $425+/- Last Year -10% -20% to -18% -17% to -5% -16% to -11%

EPS (Diluted net) $1.11 $1.00 to $1.02 $0.95 to $1.09 $3.06 to $3.22+/- Last Year -7% -20% to -18% -17% to -5% -15% to -10%

EPS (Excl Acq Costs) $1.17 $1.02 to $1.04 $0.96 to $1.10 $3.15 to $3.31+/- Last Year -2% -18% to -17% -16% to -4% -12% to -8%

Diluted Shares 131.4 131.5 131.6 131.5Effective Tax Rate 23.6% ≈ 23.0% ≈ 22.5% ≈ 23.0%Share Repurchase $52 $0 $0 $52

1st Half Q3 Q4 Full YearActual ProjectedProjected

($ and Shares in Millions, Except EPS)FY13

Total Adjusted Capital ($ Billions)

Funded Debt ($ Billions)

Lease Debt ($ Billions)

Adjusted Debt to Adj Capital*

Adjusted Debt to EBITDAR**

FY11

$4.38

$1.65

$0.79

56%

2.1x

Target 55% to 65%

Target 2.0x to 2.5x

FY12

$4.83

$2.13

$0.85

62%

2.4x

FY13Projected

$5.87

$2.80

$1.03

≈65%

≈ 3.1x

Current Performance is Affecting Key Debt Metrics

19*Operating lease expense capitalized at 6.25x annual rents **From Continuing Operations

FY13

Given where debt metrics are and the need for focus at Olive Garden...we will reduce Capital Spending going forward

Capital Deployment Priorities

Ensure Base Business Vitality– Ongoing facilities maintenance– Remodeling– Other initiatives to drive same-restaurant traffic growth

Protect Our Financial Flexibility– Maintain an investment grade credit profile to ensure efficient access to capital

Maintain Solid Dividend Growth– Consistently grow dividends annually and maintain a 50% payout ratio

on a forward looking basis over the long-term

Invest in Value Creating New Unit Growth– To capture the significant opportunity within our current portfolio

Return Excess Capital to Shareholders through Share Repurchase

20

FY13

Agenda

21





Near-Term Large Brand Sales Growth ReflectsCurrent Trends and Our Strategic Choices

Same Restaurant Sales +1% to +2% annually– +1% Check growth as modest pricing partially offsets downward

pressure from menu mix due to core menu, merchandising and promotional choices

– Traffic growth between 0% and +1%

Unit Growth +2.5% to +3.0% annually (50 to 60 units)– LongHorn 35-40– Olive Garden ≈15– Red Lobster 0-3

Annual Total Sales Growth of +3.5% to +4.5%... or $275 million to $350 million

22

Olive Garden, Red Lobster, LongHorn

Horizon

Near-Term Specialty Restaurant Group SalesGrowth is More Robust

Same Restaurant Sales +2% to +4% annually

Unit Growth +15% annually (25 to 30 units)– Seasons 52 7-10– Yard House 7-10– Capital Grille 3-6– Bahama Breeze & Eddie V’s 5-8

Annual Total Sales Growth of +17% to +19%... or $175 million to $225 million

23

Capital Grille, Yard House, Seasons 52, Bahama Breeze, Eddie V’s

Horizon

High volume, high margin businesses that currentlyhave significant growth opportunities

Near-Term Overall Sales Growth is Expectedto be 5% to 6%

24

Large Brands +3.5% to +4.5% (60% to 65% of Total Growth)

SRG Brands +17% to +19% (35% to 40% of Total Growth)

Combined Growth +5% to +6%

Horizon

Specialty Restaurant Group’s Contribution to Darden’s Overall Sales Growth is Increasingly Significant

In two years, SRG brands will deliver 40% of total Dardensales growth and represent ≈ 15% of total Darden sales

Two years ago, SRG brands delivered 21% of total Dardensales growth and represented 7% of total Darden sales

25

7%12% 15%

0%

10%

20%

30%

40%

50%

FY11 FY13 FY15 Projection

SRG % of Total Darden Sales

21%

35% 40%

0%

10%

20%

30%

40%

50%

FY11 FY13 FY15 Projection

SRG % of Total Darden Sales Growth

Horizon

Yard House Integration is On Track

Tracking to annual run rate cost synergies of $12 to $15 million... which is 3% to 4% of sales on 40 restaurants

– Expect to achieve 60% to 70% of run rate cost synergiesby end of Fiscal 2014

– Supply Chain & Support Services account for more than 60% of savings

Pipeline of openings on schedule– 4 post acquisition openings in Fiscal 2013– 8 identified locations for Fiscal 2014

Adding 3% to Darden sales growth in Fiscal 2013 and $0.04 to $0.05to earnings per share... before acquisition related impacts of $0.09

Significant, highly value creating growth potential

26

Horizon

Near-Term Capital Spending is Expectedto be Appreciably Lower

27

Capital Expenditures $700 to $725 $600 to $650New Restaurants 395 340 to 360

Maintenance Capital 148 140 to 150Remodeling 120 90 to 95Relocation / Rebuild 15 15 to 20

Technology 20 15 to 25All Other 17 10 to 20

FY14Outlook

FY13 Projected

($ in Millions)

Horizon

Near-Term Continues to Include SomeTransformational Cost Savings

28

FY11 FY12 FY13 Ultimate RunRate

$51

$170 to $195

$113 $120 to $130

Total Annual Savings

($ in Millions)

Horizon

Near-Term Annual Outlook is for ≈ $20 million of additional savings each year

Supply Chain Automation $21 $36 $41 to $44 $60 to $65Facilities Centralization $4 $8 $9 to $10 $15 to $20Sustainable Operating Practices $18 $22 $24 to $26 $25 to $30Labor Optimization $8 $46 $46 to $50 $70 to $80 Revised

Near-Term Includes ExpandingInternational Franchising

Started in Middle East and Latin America based on the success of other American full-service brands in those regions

Four agreements with...– Americana Group to develop 60 restaurants in the Middle East

• 5 units open, 3 more to open by end of Fiscal 2013– CMR to develop 37 restaurants in Mexico

• 2 units open, 1 more to open by end of Fiscal 2013– Restaurant Operators Inc. to develop 14 additional restaurants in

Puerto Rico– International Meal Company to develop 57 restaurants in Brazil,

Colombia, Panama and the Dominican Republic

29

Horizon

Near-Term Includes ExpandingConsumer Products Business

Five products at Sam’s Clubs: – Olive Garden: Italian Salad Dressing, Seasoned Croutons,

Extra-Virgin Olive Oil, Four Italian Cheese Blend– Red Lobster: Cheddar Bay Biscuit Mix

Annualized gross retail sales are above $40 millionand exceeding expectations

Best-sellers are Salad Dressingand Cheddar Bay Biscuit Mix

Salad Dressing will expandto 3,200+ Walmart stores in March

30

Horizon

Near-Term Includes Synergy Restaurants

Synergy Restaurants have separate Olive Garden andRed Lobster dining rooms but shared kitchens,restrooms and management teams

Five open, with another planned for the 4th quarter

Exceeding sales hurdle and achieving earnings hurdle

Decision whether to further expand will be made in Fiscal 2015

31

Horizon

More Modest EBIT Margin Expansion Near-TermGiven Our Strategic Choices

32

EBIT Margin expands +10 to +30 bps a year, driven by...New Unit Growth Leverage +15 to +20 bps

Effect of Same-Restaurant Sales Growththat Reflects Traffic Growthbut Tempered Check Growth -20 to -30 bps

Transformational Cost Savings +25 to +30 bps

Additional Investments for Future Success -10 to -15 bps

International Franchising & Consumer Products +5 to +10 bps

Horizon

Combination of 5% to 6% Sales Growthand Modest EBIT Margin Expansion SupportsStrong Operating Cash Flow

33

Annual Operating Cash Flow expands +$40 to +$60 milliona year, driven by...

New Unit Growth of 4% +$40 to +$50 million

Effect of Same-Restaurant Sales Growththat Reflects Traffic Growthbut Tempered Check Growth Flat to -$10 million

Transformational Cost Savings +$10 to +$20 million

Additional Investments for Future Success -$5 to -$10 million

International Franchising & Consumer Products +$5 to +$10 million

Horizon

Our Near-Term Model

Total sales growth of +5% to +6%... – +1% to +2% same-restaurant sales growth– +4% new unit sales growth– With increasing contribution from the Specialty Restaurant Group

Driving +10 to +30 bps of EBIT margin expansion...

And diluted net EPS growth of +5% to +10%...

As well as +$40 to +$60 million of incremental operating cash flow

Supporting a competitive total shareholder return– That also reflects consistent annual dividend growth

34

Horizon

In Fiscal 2014... However...There are Important Adverse Variances to Our Near-Term Model

Our Near-Term Model

Total sales growth of +5% to +6%... – +1% to +2% same-restaurant sales growth– +4% new unit sales growth– With increasing contribution from the Specialty Restaurant Group

Driving +10 to +30 bps of EBIT margin expansion...

And diluted net EPS growth of +5% to +10%...

As well as +$40 to +$60 million of incremental operating cash flow

Supporting a competitive total shareholder return– That also reflects consistent annual dividend growth

35

Horizon

Agenda

36





Sales Growth is Somewhat Higher ThanOur Near-Term Model... Due Largely toYard House Acquisition

37

Same-Restaurant Sales +1.5% to +2.5%Blended Large Brands +1.0% to +2.0%

Blended SRG +2.5% to +3.5%

Unit/Operating Weeks Growth +3.5% to +4.0%

Total Sales Growth (Business Model) +5% to +6%

Yard House Acquisition +1.0%

Total Sales Growth (Fiscal 2014) +6% to +7%

Full YearProjected

FY14

Expect Normalized Cost Pressureand Modest Pricing / Check Growth

38

Overall Inflation ($4) 0.1% ($123) 1.9% ($243) 3.6% ($126) 1.8% 2.0% - 2.5%Food & Beverage $71 -3.3% ($42) 1.9% ($142) 6.1% ($15) 0.6% 1.5% - 2.5%

Utilities $17 -6.3% $0 0.0% $2 -1.0% $1 -0.8% 2.0% - 4.0%

All Other Costs ($92) 2.4% ($81) 2.0% ($103) 2.4% ($112) 2.6% 2.0% - 3.0%

Cost Savings Initiatives* $77 $43 $73 $28

Net Inflation $73 -1.2% ($80) 1.3% ($170) 2.5% ($98) 1.4% 1.5% - 2.0%

Pricing / Check Growth 1.6% 1.8% 1.2% 0.6% ≈1%

FY10 FY11 FY12FY13

Projected

$ $ $ $ %%%%

FY14Outlook

%

≈ 0.50%

($ in Millions)

* Excludes acquisition cost synergies

FY14

Investments for Future Success are at Levels Anticipated in Our Near-Term Model

39


P&L ExpenseOperations Organization Structure 4 Other Growth Initiatives 5 5 IT Platform 2 7 13 Lobster Aquaculture 2 3 3 9 10 Total $2 $3 $5 $25 $28

Other Cash OutflowsIT Platform 2 27 50 Lobster Aquaculture 37 2 Total $2 $64 $52

($ in Millions)FY14

EBIT Margin Dynamics for Fiscal 2014 Before Important Variances

40

EBIT

Mar

gin

Gro

wth

Same-Rest Guest Count

Growth

New Rest Growth

Cost Inflation Net of Pricing /

Check Growth

Cost Savings

Near-Term Model EBIT

MarginGrowth

GrowthInvestments for Future Success

+30 to +40 bps

+15 to +20 bps

-50 to -60 bps

+25 to +30 bps

-10 to -15 bps

0%Int’l

Franchising & Consumer

Products

+5 to +10 bps +10 bps

to+30 bps

FY14

Fiscal 2014 Variances to Our Near-TermBusiness Model

Resetting Incentives to Target ($0.30) to ($0.34)

Healthcare Transition Costs ($0.05) to ($0.06)(January through May)

Lower Yard House Acquisition Costs +$0.08($0.09 in FY13 vs $0.01 in FY14)

41

Effect onEarnings Per Share

FY14

EBIT Margin Dynamics Including the Variances for Fiscal 2014

42

Near-Term Model EBIT

Margin Growth

Lower Yard

House AcqCosts

Resetting Incentives to Target

Healthcare Transition

Costs

FY14 Expected

EBIT Margin

EBIT

Mar

gin

Gro

wth

0%

+15 to +25 bps

-75 to -85 bps

-5 to -15 bps

-40 bpsto

-60 bps

+10 bpsto

+30 bps

FY14

EPS Dynamics for Fiscal 2014Before the Variances

43

+5% to +6%

+6% to +7% -7% to -8%

+2% to +3% -1% to -2%

Earn

ings

Per

Sha

re G

row

th

0%

Same-Rest Guest Count

Growth

New Rest Growth

Cost Inflation Net of Pricing /

Check Growth

Cost Savings

Near-Term ModelEPS

Growth

GrowthInvestments for Future Success

Int’l Franchising & Consumer

Products

+1% to +1.5% +5%

to+10%

FY14

EPS Dynamics for Fiscal 2014Including the Variances

44

Near-Term ModelEPS

Growth

Lower Yard

House AcqCosts

Resetting Incentives to

Target

Healthcare Transition

Costs

FY14 Expected

EPS Growth

+2.5% -9.5% to -10.5%

-1% to -2%Earn

ings

Per

Sha

re G

row

th

0%+3%to

-3%

+5%to

+10%

FY14

In Summary...

While Sales Pressure Persists... Especially at Large Nationally Advertised Brands... Margins and Cash Flows Are Resilient

Tempering Average Check and New Unit Growth... And Investing Behind Other Strategic Choices... Still Leaves Us with a Solid Near-Term Business Model

Even with a Solid Near-Term Model and Lower Yard House Acquisition Costs... Incentive Resets and Healthcare Transition Costs Mean Lower EBIT Margins and Flat Earnings

45

Strategic Choices We Are Making to Strengthen How We Go to Market Today... and Our Guest Experiences for the Future... Are the Right Decisions for Our Business

operating successfully in a new era analysts feb... · costs to open, close or remodel restaurants,...

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