Restaurant Brands International recently reported quarterly revenue that exceeded analysts’ expectations, driven by strong sales at Tim Hortons and the company’s international restaurants. CEO Josh Kobza acknowledged that while they were aiming for better top-line results, they were pleased with their performance compared to competitors in major markets. As a result, shares of Restaurant Brands increased by 3% in morning trading.
In terms of financial figures, Restaurant Brands reported that earnings per share were 86 cents adjusted, slightly below the 87 cents expected by Wall Street analysts. However, revenue came in at $2.08 billion, surpassing the expected $2.02 billion. The company’s second-quarter net income was $399 million, or 88 cents per share, up from $351 million, or 77 cents per share, compared to the previous year. Even after excluding items, the company’s earnings per share were a solid 86 cents. Revenue experienced a notable 17% rise to $2.08 billion, driven by recent acquisitions in the U.S., particularly Burger King restaurants.
Among the four chains under Restaurant Brands, Tim Hortons stood out with a same-store sales growth of 4.6%. Their efforts to expand their customer base through the introduction of new menu items, such as flatbread pizzas and energy drinks, have been successful. Similarly, Popeyes experienced a modest 0.5% increase in same-store sales, primarily due to the popularity of their new boneless wings. On the other hand, both Burger King and Firehouse Subs reported a slight decline in same-store sales for the quarter.
Despite challenges faced by Burger King, such as softer sales and traffic results, the company is undergoing a significant turnaround. Burger King, along with other major fast-food chains, introduced a $5 value meal to attract customers and boost spending. This strategic move has proven profitable for franchisees and has been extended until October. Internationally, locations in Brazil, Australia, and Japan saw remarkable same-store sales growth, compensating for weaker performance in China and the Middle East.
Looking ahead, Restaurant Brands International is anticipating a same-store sales growth of approximately 2% for the second half of the year. The company recently acquired Popeyes China, which will be integrated into their financial results in the upcoming quarter. The addition of Restaurant Holdings, including Popeyes China and acquired restaurants from Carrols, indicates the company’s commitment to expansion and growth in the global market.
Restaurant Brands International’s strong financial performance, particularly in Tim Hortons and international markets, demonstrates their resilience and competitive edge in the fast-food industry. Despite challenges faced by some of their chains, the company’s strategic initiatives, innovative menu offerings, and global expansion efforts position them for continued success in the future.