In this photo illustration, a Burger King Whopper burger is displayed on April 5, 2022 in San Anselmo, California.
Justin Sullivan | Getty Images
international restaurant brand Tuesday Report Quarterly earnings and revenue topped analysts’ expectations, driven by double-digit same-store sales growth at Tim Hortons and Burger King.
Comparing the company’s report with Wall Street’s expectations, based on a Refinitiv survey of analysts:
- EPS: Adjusted 75 cents vs. 64 cents expected
- Revenue: $1.59 billion vs. $1.56 billion expected
Restaurant Brands reported first-quarter net income of $277 million, or 61 cents a share, up from $270 million, or 59 cents a share, a year earlier.
Excluding items, the company earned 75 cents a share.
Net sales rose 9.6% year over year to $1.59 billion. The company’s same-store sales rose 10.3% in the quarter, driven by double-digit growth at Burger King and Tim Hortons.
Burger King’s same-store sales rose 12.3%, beating StreetAccount’s estimate of 6.8%. In the U.S., the burger chain’s same-store sales rose 8.7%, an early sign of a turnaround at home.
“This is one of the best results we’ve had in a long time,” Restaurant Brands CEO Josh Kobza told CNBC.
In April, Burger King U.S. President Tom Curtis told CNBC that the chain was seeing record sales of its Whoppers thanks to its new ad campaign and a Whopper-themed jingle that went viral on TikTok.
“Given these results, moderating cost inflation and investments in our brands, combined with strong operating leverage at the restaurant level, we are increasingly optimistic about BK’s path forward this year and going forward,” Kobza told analysts on Tuesday.
The turnaround strategy also focuses on improving franchisee profitability. Two of Burger King’s U.S. franchisees have filed for bankruptcy through 2023. Kobza said on the conference call that he expects more “short-term noise” as some locations move into the hands of its top operators.
Same-store sales at Tim Hortons rose 13.8%, topping StreetAccount’s estimate of 10.1%. In its home market of Canada, same-store sales rose 15.5%.
The Canadian coffee chain has undergone its own transformation in recent years to revive sales in its home market. Restaurant Brands revamped Tims’ menu and loyalty program and upgraded its coffee brewing equipment.Its mobile app is now the No. 2 e-commerce app in Canada, behind amazon.
Popeyes Louisiana Kitchen reported same-store sales growth of 5.6%, topping StreetAccount’s estimate of 4%. A year ago, the company reported a 3% drop in same-store sales.
In January, the fried chicken chain brought back Ghost Pepper Wings for the first time in three years, and they sold out within two weeks. Executives said chicken wings would encourage customers to spend more, improve franchisees’ profit margins and attract younger customers. Ghost Pepper Wings returned to the menu on Monday as a permanent addition.
Firehouse Subs, the newest addition to the Restaurant Brands portfolio, posted a 6.1% increase in same-store sales for the quarter.