Restaurant Brands International, the parent company of popular fast-food chains Tim Hortons, Burger King, and Popeyes, has reported strong quarterly earnings, surpassing analysts’ expectations. The company’s success was primarily driven by robust sales at Tim Hortons.
In the fourth quarter, Restaurant Brands International recorded a net income attributable to shareholders of $508 million, or $1.60 per share, compared to $229 million, or 74 cents per share, in the same period the previous year. Adjusted earnings per share stood at 75 cents, exceeding the estimated 73 cents. Additionally, the company’s revenue reached $1.82 billion, slightly higher than the expected $1.81 billion.
This quarter marked the first time that Restaurant Brands International shared its results using its new reporting structure, which separates its individual brands in the U.S. and Canada from its international locations. Tim Hortons, known for its hot coffee and breakfast food, experienced a remarkable 8.4% increase in same-store sales during the quarter, surpassing StreetAccount estimates of 4.7%. This Canadian coffee chain is typically the largest contributor to Restaurant Brands International’s revenue. CEO Josh Kobza attributed Tim Hortons’ success to the growth in sales of cold drinks and afternoon snacks.
Burger King, another brand under Restaurant Brands International, reported a same-store sales growth of 6.3%. The chain’s U.S. business has been implementing a turnaround plan that includes restaurant remodeling and increased advertising expenditure. The strategy seems to be paying off, as Burger King’s U.S. locations witnessed traffic growth during the quarter, a positive sign for the company.
Tom Curtis, President of Burger King U.S., highlighted the resilience of consumers in the fourth quarter, stating that they were still interested in good deals. He attributed part of Burger King’s success to the introduction of the Royal Crispy Wraps, which resonated well with customers.
Popeyes, the fried chicken chain owned by Restaurant Brands International, experienced a same-store sales growth of 5.5% during the quarter. The company launched chicken wings as a permanent menu item, and they were prominently featured in Popeyes’ first-ever Super Bowl commercial.
Restaurant Brands International also reported a 4.6% growth in international same-store sales. The company’s global expansion continues to contribute to its overall success.
The positive quarterly results have encouraged optimism among investors. Shares of Restaurant Brands International remained unchanged in premarket trading following the announcement.
Looking ahead, Restaurant Brands International recently acquired Carrols Restaurant Group, Burger King’s largest U.S. franchisee, in a $1 billion deal. This acquisition will aid in the rapid renovation of Burger King locations across the country.
With its strong quarterly performance and strategic initiatives, Restaurant Brands International is poised for continued growth and success in the fast-food industry.