BK-Tim Hortons tie-up celebrates successful first year
Feb. 16, 2016
by Monica Watrous
Burger King's sales were boosted by new product launches like new Chicken Fries varieties.
OAKVILLE, Ontario – Restaurant Brands International Inc. finished its first year with strong comparable sales growth and international expansion at Burger King and Tim Hortons.
|Daniel Schwartz, CEO of Restaurant Brands International
“In our first year as RBI, we set the foundation for long-term growth at Tim Hortons, while building on the momentum at Burger King,” said Daniel Schwartz, CEO of Restaurant Brands International, during a Feb. 16 earnings call with financial analysts. “We continue to be focused on driving top-line growth and finding the right partners to bring great restaurants to our guests all around the world.”
For the fiscal year ended Dec. 31, 2015, the company had net income of $511.7 million, equal to $0.51 per share on the common stock, up 17 percent from net income on a pro forma basis of $437.1 million for the prior year. Revenues for the year totaled $4.052 billion, down 3.5 percent from pro forma revenues of $4.20 billion, due to the unfavorable impact of foreign currency translation. The pro forma amounts reflect consolidated financial information as if the merger between Tim Hortons and Burger King Worldwide had occurred at the beginning of 2014.
Net income for the fourth quarter advanced to $184.5 million, or $0.25 per share, up 242 percent from pro forma net income of $54 million for the year-ago period. Revenues declined 3.3 percent to $1.057 billion from pro forma revenues of $1.093 billion.
Comparable sales at Burger King increased 5.4 percent for the year and 3.9 percent for the quarter on a constant currency basis, behind successful new product launches and promotions, including new Chicken Fries varieties and the A.1. Halloween Whopper sandwich.
Burger King plans to launch its new flame-grilled hot dogs on Feb. 23.
“Our newest launch, grilled (hot) dogs, builds upon the momentum of our successful strategy of launching fewer and more impactful products,” Schwartz said. “Grilled dogs are a flame grilled take on one of America’s favorite foods, the hot dog, and with the launch of grilled dogs, we are now going to be serving hot dogs at more locations than any other restaurant chain in the United States.”
At Tim Hortons, comparable sales increased 5.6 percent for the year and 6.3 percent for the quarter in constant currency, driven by continued strength in beverages and new menu introductions such as Nutella pockets and grilled wraps.
Tim Hortons' sales growth was fueled by new menu item introductions, like Nutella pastry pockets.
“We had a truly historic year at Tim Hortons, with a number of successful product launches, accelerated restaurant development and strong financial results,” Schwartz said. “Our marketing success was due to a balanced strategy of defending our leadership in coffee while expanding our presence in different day parts with successful new product launches.”
During the year, the company opened 786 net new restaurants for a total of more than 19,000 restaurants around the world.