Red Lobster in hot water as shrimp costs increase
The seafood chain's parent company Darden Restaurants on Friday reported a lower quarterly profit in line with its previously announced estimates. Sales at its struggling Olive Garden and Red Lobster chains dropped by 5.4 percent and 8.8 percent, respectively, as reported on March 3.
Both chains have been losing customers as more affordable alternatives such as Chipotle have gained in popularity.
But in recent months, another factor weighing on Red Lobster was higher shrimp costs.
Executives said costs in
the quarter rose about 30 percent because of "production issues in
Asia." They said don't expect relief until the early part of its fiscal
2015 year.
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