Burger King second-quarter net income, sales up
February 4, 2010
by Bryan Salvage
MIAMI — Burger King Holdings Inc. announced for the second quarter of fiscal 2010, earnings per share were $0.37 compared to $0.33 in the same period last year; up 12%. Net income was $50.2 million compared to $44.3 million from the second quarter one-year earlier. Revenues for the second quarter of fiscal 2010 were up 2% at $645.4 million, compared to $634.1 million in the same quarter last year.
Revenues were aided by a worldwide net restaurant growth rate of 2.7%, among the highest in the industry, and by currency translation, which positively impacted quarterly revenues by $22.8 million, the company said.
Worldwide traffic was positive and increased quarter-over-quarter largely driven by the brand’s $1 ¼ lb. Double Cheeseburger promotion in the U.S. The promotion positively impacting traffic and gross profit dollars, the company said.
The company posted positive comparable sales of 0.9% in its E.M.E.A./A.P.A.C. business segment lapping a strong same-store-sales comparison of 5.0% in the same period last year. Leading this performance were the U.K., Spain and the company’s major A.P.A.C. markets including Korea, Australia and New Zealand offset by negative comparable sales in Germany and the Netherlands.
Marketing in the U.S. continued to focus on value with the six-month limited-time-offer national launch of the $1 ¼ lb. Double Cheeseburger on Oct. 19. The company augmented this promotion during the holiday season with 'BK Dollar Holidays' featuring 20 greeting cards containing a dollar bill for a $1 ¼ lb. Double Cheeseburger.
In the second quarter, the company increased its worldwide net restaurant count by 95 and reached a significant milestone with the grand opening of its 12,000th restaurant located in Beijing’s Joy City. The company also unveiled its new 20/20 restaurant design at Schiphol Airport in Amsterdam, and opened its first Whopper Bar in both the Asia-Pacific and Latin America regions. During the last 12 months, the company opened a total of 321 net new restaurants and is on target to open 250 to 300 new restaurants during fiscal 2010.
“The Q.S.R. industry is expected to face strong macroeconomic headwinds throughout 2010, as unemployment conditions are not likely to improve,” said John W. Chidsey, chairman and chief executive officer. “Therefore, we will continue to focus on our guests’ desire for extreme affordability with promotions such as the $1 ¼ lb. Double Cheeseburger and other value promotions we will be introducing in the near-term. We will balance those offerings with a strong indulgent product mix including our Steakhouse XT burger, which launches nationally this month with the full implementation of our new batch broilers across the U.S. system.”