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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 10-Q

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(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended February 25, 2001

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from .............. to ...............

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1-13666
Commission File Number

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DARDEN RESTAURANTS, INC.
(Exact name of registrant as specified in its charter)

Florida 59-3305930
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)

5900 Lake Ellenor Drive,
Orlando, Florida 32809
(Address of principal executive offices) (Zip Code)

407-245-4000
(Registrant's telephone number, including area code)

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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. [X] Yes [ ] No
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APPLICABLE ONLY TO CORPORATE ISSUERS:

Number of shares of common stock outstanding as of March 28, 2001:
118,067,688 (excluding 50,597,477 shares held in treasury).

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DARDEN RESTAURANTS, INC.

TABLE OF CONTENTS

Page

Part I - Financial Information

Item 1. Financial Statements

Consolidated Statements of Earnings 3

Consolidated Balance Sheets 5

Consolidated Statements of Changes in
Stockholders' Equity 6

Consolidated Statements of Cash Flows 7

Notes to Consolidated Financial Statements 9

Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 11

Item 3. Quantitative and Qualitative Disclosures About
Market Risk 13

Part II - Other Information

Item 6. Exhibits and Reports on Form 8-K 14

Signatures 15

Index to Exhibits 16

PART I
FINANCIAL INFORMATION

Item 1. Financial Statements
DARDEN RESTAURANTS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(In Thousands, Except per Share Data)
(Unaudited)

Thirteen Weeks Ended
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February 25, 2001 February 27, 2000
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Sales........................................................ $ 988,635 $ 917,505
Costs and Expenses:
Cost of sales:
Food and beverage....................................... 313,242 295,289
Restaurant labor........................................ 313,930 295,247
Restaurant expenses..................................... 141,897 123,615
---------- -----------
Total Cost of Sales................................... $769,069 $ 714,151
Selling, general and administrative....................... 98,455 91,003
Depreciation and amortization............................. 37,092 32,990
Interest, net............................................. 8,528 6,646
---------- -----------
Total Costs and Expenses............................ $913,144 $ 844,790
----------- -----------

Earnings before Income Taxes................................. 75,491 72,715
Income Taxes................................................. (25,964) (25,823)
----------- -----------

Net Earnings................................................. $ 49,527 $ 46,892
============ ===========

Net Earnings per Share:
Basic..................................................... $ 0.41 $ 0.37
============ ===========
Diluted................................................... $ 0.40 $ 0.36
============ ===========

Average Number of Common Shares Outstanding:
Basic..................................................... 119,800 127,700
============ ===========
Diluted................................................... 124,000 130,500
============ ===========

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See accompanying notes to consolidated financial statements.

DARDEN RESTAURANTS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(In Thousands, Except per Share Data)
(Unaudited)

Thirty-Nine Weeks Ended
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February 25, 2001 February 27, 2000
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Sales........................................................ $ 2,938,798 $ 2,695,127
Costs and Expenses:
Cost of sales:
Food and beverage....................................... 942,640 865,919
Restaurant labor........................................ 935,469 870,970
Restaurant expenses..................................... 417,198 382,222
------------ ------------
Total Cost of Sales................................... $ 2,295,307 $ 2,119,111
Selling, general and administrative....................... 303,755 279,491
Depreciation and amortization............................. 108,517 96,131
Interest, net............................................. 22,579 16,487
------------ ------------
Total Costs and Expenses............................ $2,730,158 $2,511,220
------------ ------------

Earnings before Income Taxes................................. 208,640 183,907
Income Taxes................................................. (72,651) (65,248)
------------ -------------

Net Earnings................................................. $ 135,989 $ 118,659
============ ============

Net Earnings per Share:
Basic..................................................... $ 1.13 $ 0.91
============ ============
Diluted................................................... $ 1.10 $ 0.89
============ ============

Average Number of Common Shares Outstanding:
Basic..................................................... 120,400 130,200
============ ============
Diluted................................................... 124,100 133,800
============ ============

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See accompanying notes to consolidated financial statements.

DARDEN RESTAURANTS, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands)

(Unaudited)
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February 25, 2001 May 28, 2000
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ASSETS

Current Assets:
Cash and cash equivalents................................. $ 29,297 $ 26,102
Receivables............................................... 35,105 27,962
Inventories............................................... 208,041 142,187
Net assets held for disposal.............................. 10,884 19,614
Prepaid expenses and other current assets................. 16,230 26,525
Deferred income taxes..................................... 49,489 48,070
-------------- -------------
Total Current Assets.................................... $ 349,046 $ 290,460
Land, Buildings and Equipment................................ 1,709,729 1,578,541
Other Assets................................................. 107,980 102,422
-------------- -------------

Total Assets........................................ $ 2,166,755 $ 1,971,423
============== =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable.......................................... $ 144,205 $ 140,487
Short-term debt........................................... 82,000 115,000
Current portion of long-term debt......................... 2,514 2,513
Accrued payroll........................................... 78,069 77,805
Accrued income taxes...................................... 40,969 33,256
Other accrued taxes....................................... 26,534 25,524
Other current liabilities................................. 232,042 212,302
-------------- -------------
Total Current Liabilities............................... $ 606,333 $ 606,887
Long-term Debt............................................... 446,117 304,073
Deferred Income Taxes........................................ 80,274 79,102
Other Liabilities............................................ 20,444 20,891
-------------- -------------
Total Liabilities.................................. $ 1,153,168 $ 1,010,953
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Stockholders' Equity:
Common stock and surplus.................................. $ 1,390,951 $ 1,351,707
Retained earnings......................................... 475,802 344,579
Treasury stock............................................ (789,332) (666,837)
Accumulated other comprehensive income.................... (12,974) (12,457)
Unearned compensation..................................... (50,860) (56,522)
--------------- --------------
Total Stockholders' Equity......................... $ 1,013,587 $ 960,470
--------------- --------------

Total Liabilities and Stockholders' Equity......... $ 2,166,755 $ 1,971,423
============== =============

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See accompanying notes to consolidated financial statements.

DARDEN RESTAURANTS, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN
STOCKHOLDERS' EQUITY For the Thirty-Nine Weeks
Ended February 25, 2001 and February 27, 2000
(In Thousands)
(Unaudited)

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Common Accumulated
Stock Other Total
and Retained Treasury Comprehensive Unearned Stockholders'
Surplus Earnings Stock Income Compensation Equity
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Balance at May 28, 2000.................... $1,351,707 $344,579 $(666,837) $ (12,457) $(56,522) $ 960,470
Comprehensive income:
Net earnings............................ 135,989 135,989
Other comprehensive income, foreign
currency adjustment..................... (517) (517)
---------
Total comprehensive income.......... 135,472
Cash dividends declared.................... (4,766) (4,766)

Stock option exercises (2,289 shares)..... 23,758 23,758
Issuance of restricted stock (293 shares),
net of forfeiture adjustments.............. 3,941 1,035 (5,040) (64)
Earned compensation........................ 3,077 3,077
ESOP note receivable repayments............ 7,625 7,625
Income tax benefit credited to equity...... 10,324 10,324
Purchases of common stock for treasury
(6,433 shares) ......................... (125,231) (125,231)
Issuance of treasury stock under Employee
Stock Purchase and other plans (184 shares) 1,221 1,701 2,922
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Balance at February 25, 2001 $1,390,951 $475,802 $ (789,332) $ (12,974) $ (50,860) $1,013,587
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Common Accumulated
Stock Other Total
and Retained Treasury Comprehensive Unearned Stockholders'
Surplus Earnings Stock Income Compensation Equity
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Balance at May 30, 1999.................... $1,328,796 $178,008 $(466,902) $ (12,115) $(63,751) $ 964,036

Comprehensive income:
Net earnings............................ 118,659 118,659
Other comprehensive income, foreign
currency adjustment..................... 298 298
-------
Total comprehensive income.......... 118,957
Cash dividends declared.................... (5,227) (5,227)
Stock option exercises (974 shares)........ 8,992 8,992
Issuance of restricted stock (220 shares),
net of forfeiture adjustments.............. 3,563 (3,590) (27)
Earned compensation........................ 2,344 2,344
ESOP note receivable repayments............ 4,850 4,850
Income tax benefit credited to equity...... 4,627 4,627
Proceeds from issuance of equity put options 1,814 1,814
Purchases of common stock for treasury
(8,128 shares).......................... (148,252) (148,252)
Issuance of treasury stock under Employee
Stock Purchase Plan (180 shares)............ 1,475 1,561 3,036
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Balance at February 27, 2000 $1,349,267 $291,440 $(613,593) $ (11,817) $(60,147) $ 955,150

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See accompanying notes to consolidated financial statements.

DARDEN RESTAURANTS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)

Cash Flows--Operating Activities
Net earnings.................................................... $ 49,527 $ 46,892
Adjustments to reconcile net earnings to cash flow:
Depreciation and amortization................................. 37,092 32,990
Amortization of unearned compensation and loan costs.......... 1,785 1,540
Change in current assets and liabilities...................... 62,175 45,844
Change in other liabilities .................................. (405) 46
Loss on disposal of land, buildings and equipment............. 1,327 549
Deferred income taxes......................................... 910 2,521
Income tax benefit credited to equity....................... 1,699 518
Other, net.................................................... 49 (379)
--------- --------
Net Cash Provided by Operating Activities................... $ 154,159 $130,521
--------- --------

Cash Flows--Investing Activities
Purchases of land, buildings and equipment...................... (86,736) (85,419)
Purchases of intangibles........................................ (4,279) (485)
Increase in other assets........................................ (242) (2,953)
Proceeds from disposal of land, buildings and equipment
(including net assets held for disposal)...................... 3,324 4,014
--------- --------
Net Cash Used by Investing Activities....................... $ (87,933) $(84,843)
---------- ---------

Cash Flows--Financing Activities
Proceeds from issuance of common stock.......................... 4,827 2,549
Purchases of treasury stock..................................... (42,008) (64,779)
ESOP note receivable repayment.................................. 1,675 2,100
(Decrease) increase in short-term debt.......................... (7,300) 16,300
Repayment of long-term debt..................................... (1,675) (2,100)
Proceeds from issuance of equity put options.................... 675
Payment of loan costs........................................... (201) (25)
--------- --------
Net Cash Used by Financing Activities....................... $ (44,682) $(45,280)
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Increase in Cash and Cash Equivalents.............................. 21,544 398
Cash and Cash Equivalents - Beginning of Period.................... 7,753 19,947
----------- ---------

Cash and Cash Equivalents - End of Period.......................... $ 29,297 $ 20,345
========= =========

Cash Flow from Changes in Current Assets and Liabilities
Receivables..................................................... 109 (24,695)
Refundable income taxes, net.................................... 4,347
Inventories..................................................... 125 10,460
Prepaid expenses and other current assets....................... 1,734 2,328
Accounts payable................................................ (4) 4,203
Accrued payroll................................................. 11,395 9,805
Accrued income taxes............................................ 22,655 16,683
Other accrued taxes............................................. 245 374
Other current liabilities....................................... 25,916 22,339
--------- ---------
Change in Current Assets and Liabilities...................... $ 62,175 $ 45,844
========= =========

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See accompanying notes to consolidated financial statements.

DARDEN RESTAURANTS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)

Cash Flows--Operating Activities
Net earnings.................................................... $135,989 $118,659
Adjustments to reconcile net earnings to cash flow:
Depreciation and amortization................................. 108,517 96,131
Amortization of unearned compensation and loan costs.......... 5,189 4,289
Change in current assets and liabilities...................... (28,886) (70,612)
Change in other liabilities .................................. (447) (56)
Loss on disposal of land, buildings and equipment............. 1,346 1,125
Deferred income taxes......................................... (247) 13,134
Income tax benefit credited to equity....................... 10,324 4,627
Other, net.................................................... 13 148
-------- --------
Net Cash Provided by Operating Activities................... $231,798 $167,445
-------- --------

Cash Flows--Investing Activities
Purchases of land, buildings and equipment...................... (244,714) (192,350)
Purchases of intangibles........................................ (7,056) (1,846)
Increase in other assets........................................ (144) (1,947)
Proceeds from disposal of land, buildings and equipment
(including net assets held for disposal)...................... 11,923 16,733
-------- --------
Net Cash Used by Investing Activities....................... $(239,991) $(179,410)
========== =========

Cash Flows--Financing Activities
Proceeds from issuance of common stock.......................... 26,504 11,870
Dividends paid.................................................. (4,766) (5,227)
Purchases of treasury stock..................................... (125,231) (148,252)
ESOP note receivable repayments................................. 7,625 4,850
(Decrease) increase in short-term debt.......................... (33,000) 131,500
Proceeds from issuance of long-term debt....................... 149,539
Repayment of long-term debt..................................... (7,631) (4,856)
Payment of loan costs........................................... (1,652) (349)
Proceeds from issuance of equity put options.................... ________ 1,814
----------
Net Cash Provided by (Used by) Financing Activities......... $ 11,388 $ (8,650)
--------- ----------

Increase (Decrease) in Cash and Cash Equivalents................... 3,195 (20,615)
Cash and Cash Equivalents - Beginning of Period.................... 26,102 40,960
--------- ---------

Cash and Cash Equivalents - End of Period.......................... $ 29,297 $ 20,345
========= =========

Cash Flow from Changes in Current Assets and Liabilities
Receivables..................................................... (7,143) (9,003)
Inventories..................................................... (68,161) (60,686)
Prepaid expenses and other current assets....................... 2,072 (3,298)
Accounts payable................................................ 3,718 (20,126)
Accrued payroll................................................. 264 525
Accrued income taxes............................................ 7,713 139
Other accrued taxes............................................. 1,010 (2,785)
Other current liabilities....................................... 31,641 24,622
--------- ----------
Change in Current Assets and Liabilities...................... $ (28,886) $ (70,612)
========== ===========

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See accompanying notes to consolidated financial statements.

DARDEN RESTAURANTS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollar Amounts in Thousands, Except per Share Data)

Note 1. Background

These consolidated financial statements do not include certain information
and footnotes required by generally accepted accounting principles for complete
financial statements. However, in the opinion of management, all adjustments
considered necessary for a fair presentation have been included and are of a
normal recurring nature. Operating results for the thirteen and thirty-nine
weeks ended February 25, 2001 are not necessarily indicative of the results that
may be expected for the fiscal year ending May 27, 2001.

These statements should be read in conjunction with the consolidated
financial statements and footnotes included in our annual report on Form 10-K
for the year ended May 28, 2000. The accounting policies used in preparing these
consolidated financial statements are the same as those described in our annual
report on Form 10-K. Certain reclassifications have been made to prior period
amounts to conform with current period presentation.

Note 2. Consolidated Statements of Cash Flows

During the thirteen and thirty-nine weeks ended February 25, 2001,
Darden paid $8,364 and $18,064, respectively, for interest (net of amount
capitalized) and $801 and $55,982, respectively, for income taxes. During the
thirteen and thirty-nine weeks ended February 27, 2000, Darden paid $9,323 and
$18,488, respectively, for interest (net of amount capitalized) and $1,671 and
$48,210, respectively, for income taxes.

Note 3. Net Earnings Per Share

Outstanding stock options issued by the Company represent the only dilutive
effect reflected in diluted weighted average shares outstanding. Options to
purchase 29,667 and 3,725,249 shares of common stock were excluded from the
calculation of diluted earnings per share for the thirteen weeks ended February
25, 2001 and February 27, 2000, respectively, because their exercise prices
exceeded the average market price of common shares for the period. Options to
purchase 2,524,418 and 3,597,926 shares of common stock were excluded from the
calculation of diluted earnings per share for the thirty-nine weeks ended
February 25, 2001 and February 27, 2000, respectively, for the same reason.

Note 4. Restructuring Liability

In 1997, the Company recorded restructuring charges of $70,900 in
connection with the closing of certain restaurant properties. The related
liabilities are included in other current liabilities in the accompanying
consolidated balance sheets and were established to accrue for estimated
carrying costs of buildings and equipment prior to disposal, employee severance
costs, lease buy-out provisions and other costs associated with the
restructuring action. All restaurant closings under this restructuring action
have been completed. The remaining restructuring actions, including disposal of
the closed owned properties and the lease buy-outs related to the closed leased
properties, are expected to be substantially completed during 2001.

DARDEN RESTAURANTS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
(Dollar Amounts in Thousands, Except per Share Data)

A summary of restructuring liability activity for the nine months ended February
25, 2001 is as follows:

Balance at May 28, 2000.......................................... $ 8,564
Cash Payments:
Carrying costs and employee severance payments................. (1,027)
Lease payments including lease buy-outs........................ (1,450)
-------
Balance at February 25, 2001..................................... $ 6,087
=======

Note 5. Long-term Debt

On July 13, 2000, the Company filed a registration statement with the
Securities and Exchange Commission. The purpose of the filing was to register
$500,000 of debt securities using a shelf registration process. Under this
process, the Company may offer, from time to time, up to $500,000 of debt
securities. On September 5, 2000, the Company issued $150,000 of unsecured
8.375% senior notes due in September 2005. Proceeds from the issuance were used
to repay short-term debt.
10

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

The following table sets forth selected restaurant operating data as a
percentage of sales for the periods indicated. All information is derived from
the consolidated statements of earnings for the thirteen and thirty-nine weeks
ended February 25, 2001 and February 27, 2000.

Thirteen Weeks Ended Thirty-Nine Weeks Ended
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February 25, February 27, February 25, February 27,
2001 2000 2001 2000
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Sales...................................... 100.0% 100.0% 100.0% 100.0%
Costs and Expenses:
Cost of sales:
Food and beverage..................... 31.7 32.2 32.1 32.1
Restaurant labor...................... 31.8 32.2 31.8 32.3
Restaurant expenses................... 14.3 13.4 14.2 14.2
----- ------ ----- ------
Total Cost of Sales................. 77.8% 77.8% 78.1% 78.6%
Selling, general and administrative..... 10.0 10.0 10.3 10.4
Depreciation and amortization........... 3.7 3.6 3.7 3.6
Interest, net........................... 0.9 0.7 0.8 0.6
----- ------ ----- ------
Total Costs and Expenses...... 92.4% 92.1% 92.9% 93.2%
----- ------ ----- ------

Earnings before Income Taxes............... 7.6 7.9 7.1 6.8
Income Taxes............................... (2.6) (2.8) (2.5) (2.4)
----- ------ ----- ------

Net Earnings............................... 5.0% 5.1% 4.6% 4.4%
===== ====== ===== ======

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Results of Operations

For the fiscal 2001 third quarter ended February 25, 2001, earnings after
tax were $49.5 million or 40 cents per diluted share, compared to earnings after
tax of $46.9 million or 36 cents per diluted share in the third quarter of
fiscal 2000. The increase in third quarter earnings was primarily attributable
to strong same-restaurant sales growth at both Red Lobster and Olive Garden.
Sales of $988.6 million for the third quarter were 7.8% higher than last year's
third quarter.

For the first nine months of fiscal 2001, net earnings were $136.0 million
or $1.10 per diluted share, compared to $118.7 million or 89 cents per diluted
share in the same fiscal 2000 period. Sales of $2.9 billion for the first nine
months of fiscal 2001 were 9.0% higher than last year.

Food and beverage costs for the quarter were 31.7% of sales, compared to
32.2% of sales last year. The decrease is primarily a result of favorable
menu-mix changes, pricing changes, and other efficiencies resulting from higher
sales volumes, which were partially offset by higher product costs. Restaurant
labor decreased to 31.8% of sales compared to last year's 32.2% primarily due to
efficiencies resulting from higher sales volumes. Restaurant expenses increased
to 14.3% of sales compared to 13.4% last year, principally as a result of higher
utility costs. Selling, general and administrative expenses amounting to 10.0%
of sales were comparable to last year, also at 10.0% of sales. Depreciation and
amortization expense as a percentage of sales increased from 3.6% to 3.7%
primarily as a result of new restaurant and remodel activity, partially offset
by the favorable impact of higher sales volumes. Interest expense increased to
0.9% of sales compared to 0.7% last year primarily due to higher debt levels.

The effective tax rate for the third quarter of fiscal 2001 was 34.4%
compared to 35.5% in last year's third quarter. The decrease in the effective
tax rate resulted primarily from increases in annual expected tax credits and
deductions that were not available last year.

Food and beverage costs for the first nine months of fiscal 2001 were
comparable to last year at 32.1% of sales. The comparability is a result of
favorable menu-mix changes, pricing changes, and other efficiencies resulting
from higher sales volumes, which were offset by higher product costs. Restaurant
labor decreased to 31.8% of sales compared to last year's 32.3% primarily due to
efficiencies resulting from higher sales volumes. Restaurant expenses were
comparable to last year at 14.2% of sales primarily as a result of higher sales
volumes and the fixed component of these expenses which are not impacted by
higher sales volumes, offset by higher utility costs. Selling, general and
administrative expenses amounted to 10.3% of sales compared to 10.4% in the
prior year. Depreciation and amortization expense as a percentage of sales
increased to 3.7% from 3.6% last year primarily as a result of new restaurant
and remodel activity, partially offset by the favorable impact of higher sales
volumes. Interest expense increased to 0.8% of sales compared to 0.6% last year
primarily due to higher debt levels.

The effective tax rate for the first nine months of fiscal 2001 was 34.8%
compared to 35.5% last year. The decrease in the effective tax rate resulted
primarily from increases in annual expected tax credits and deductions that were
not available last year.

Division Results

Red Lobster sales of $539.8 million were 6.2% above last year's third
quarter. Same-restaurant sales in the United States were up 5.5% for the
quarter, marking the thirteenth consecutive quarter of same-restaurant sales
increases. Third quarter operating profits improved over the prior year
primarily as a result of the increased sales and lower food and beverage and
restaurant labor expenses as a percentage of sales. These improvements were
partially offset by higher utility costs, which increased restaurant expenses as
a percentage of sales. Through the first nine months of fiscal 2001, Red
Lobster's sales increased 7.2% to $1.6 billion and same-restaurant sales in the
United States increased by 6.7%.

Olive Garden continued its positive momentum in the third quarter of fiscal
2001 with a 6.8% increase in sales to $422.6 million. Same-restaurant sales in
the United States increased 5.6%, marking the twenty-sixth consecutive quarter
of same-restaurant sales increases. Third quarter operating profits improved
over the prior year primarily as a result of the increased sales and lower food
and beverage and restaurant labor expenses as a percentage of sales. These
improvements were partially offset by higher utility costs, which increased
restaurant expenses as a percentage of sales. Through the first nine months of
fiscal 2001, Olive Garden sales increased by 8.4% to $1.3 billion and
same-restaurant sales in the United States increased by 7.2%.

Bahama Breeze restaurants continue to produce strong sales. Four new
openings occurred in the third quarter, bringing the total number of restaurants
to 19. Three additional restaurants under construction may open in fiscal 2001.

Restaurant sales at Smokey Bones BBQ, Darden's latest test concept,
continue to exceed management's initial expectations. One new opening occurred
in the third quarter in Dartmouth, MA, bringing the total number of restaurants
to five. Four additional restaurants under construction are planned to open in
fiscal 2001.

The table below details the number of restaurants open at the end of the
third quarter of fiscal 2001, compared with the number open at the end of May
2000 and the end of last fiscal year's third quarter.

NUMBER OF RESTAURANTS

- --------------------------------------------------------------------------------------------------------------------
February 25, 2001 May 28, 2000 February 27, 2000
- --------------------------------------------------------------------------------------------------------------------

Red Lobster - USA............................... 623 622 619
Red Lobster - Canada............................ 32 32 32
----- ----- -----
Total...................................... 655 654 651

Olive Garden - USA.............................. 464 464 459
Olive Garden - Canada........................... 5 5 5
----- ----- -----
Total...................................... 469 469 464

Bahama Breeze................................... 19 14 10

Smokey Bones BBQ................................ 5 2 1
----- ----- -----

Total...................................... 1,148 1,139 1,126
===== ===== =====

Financial Condition, Liquidity and Capital Resources

Inventories totaled $208.0 million as of February 25, 2001, up from $142.2
million at May 28, 2000. The increase results from typical increases in seafood
inventory levels at this time of the year due to availability and upcoming
promotions. The additional seafood is expected to be used during the current
fiscal year.

Short-term debt totaled $82.0 million as of February 25, 2001, down from
$115.0 million at May 28, 2000. Long-term debt, including its current portion,
totaled $448.6 million as of February 25, 2001, up from $306.6 million at May
28, 2000. The increase in long-term debt is a result of the Company issuing
$150.0 million of unsecured debt in the second quarter of fiscal 2001. This
issuance was used to repay short-term debt which has since increased primarily
as a result of continued share repurchase activity and increased spending on
land, buildings and equipment.

Other current liabilities totaled $232.0 million as of February 25, 2001,
up from $212.3 million at May 28, 2000. The increase is primarily a result of
net increases in employee benefit related accruals and gift certificate/card
payables.

Capital expenditures were $86.7 million for the third quarter of fiscal
2001 compared to $85.4 million in last year's third quarter. For the first nine
months of fiscal 2001, capital expenditures were $244.7 million, compared to
$192.4 million in the same period last year. The increased expenditures resulted
primarily from new restaurant growth as well as remodeling activity.

Treasury stock purchases totaled $42.0 million in the third quarter of
fiscal 2001 compared to $64.8 million in last year's third quarter. For the
first nine months of fiscal 2001, treasury stock purchases totaled $125.2
million, compared to $148.3 million in the same period last year.

Forward-Looking Statements

Certain information included in this report and other materials filed or to
be filed by the Company with the Securities and Exchange Commission (as well as
information included in oral statements or written statements made or to be made
by the Company) may contain statements that are forward-looking within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. This forward-looking
information is based on assumptions concerning important risks and uncertainties
that could significantly affect anticipated results in the future and,
accordingly, could cause the actual results to materially differ from those
expressed in the forward-looking statements. These risks and uncertainties
include competition, economic and market conditions, changes in food and other
costs, importance of locations, effects of government regulations and the
Company's ability to achieve its growth objectives, each of which is more
specifically discussed in Exhibit 99 filed with the Company's annual report on
Form 10-K for the fiscal year ended May 28, 2000.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in the information provided in our
annual report or Form 10-K for the fiscal year ended May 28, 2000.

PART II
OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits.

Exhibit 12 Computation of Ratio of Consolidated
Earnings to Fixed Charges

(b) Reports on Form 8-K.

On December 21, 2000, the Company filed a current report
on Form 8-K to announce record second quarter earnings per
diluted share of 24 cents, which was a 33% increase over last
year.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

DARDEN RESTAURANTS, INC.

Dated: April 5, 2001 By: /s/ Paula J. Shives
-------------------------------
Paula J. Shives
Senior Vice President,
General Counsel and Secretary

Dated: April 5, 2001 By: /s/ Clarence Otis, Jr.
--------------------------------
Clarence Otis, Jr.
Senior Vice President,
Chief Financial Officer
(Principal financial officer)

INDEX TO EXHIBITS

Exhibit
Number Exhibit Title Page

12 Computation of Ratio of Consolidated Earnings
to Fixed Charges 17

Exhibit 12

DARDEN RESTAURANTS, INC.
COMPUTATION OF RATIO OF CONSOLIDATED EARNINGS TO FIXED CHARGES
(Dollar Amounts in Thousands)

Consolidated Earnings from Operations
Before Income Taxes..................... $75,491 $72,715 $208,640 $183,907
Plus Fixed Charges......................... 14,583 12,151 40,205 32,504
Less Capitalized Interest.................. (833) (441) (2,558) (1,340)
------- -------- --------- --------
Consolidated Earnings from Operations
Before Income Taxes Available to
Cover Fixed Charges..................... $89,241 $84,425 $246,287 $215,071
======= ======= ======== ========

Ratio of Consolidated Earnings to Fixed
Charges................................. 6.12 6.95 6.13 6.62
======= ======= ======== ========

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