OAKVILLE, Ontario – System-wide sales growth at Burger King and Tim Horton’s restaurants helped parent-company Restaurant Brands International Inc. swing to profit for the fourth quarter and full-year.
Net income for the most recent quarter ended Dec. 31, 2016, attributable to common shareholders was $118.4 million or $0.50 per diluted share, vs. $51.7 million, or $0.25 per diluted share in the prior year period.
Total revenues for the quarter were $1,111.4 million compared with $1,057.0 million reported a year ago.
For the full year, RBI reported net income of $345.6 million, or $.14 per diluted share, compared with $103.9 million, or $0.50 per diluted share a year ago. Revenues for the year were $4,145.8 million vs. $4,052.2 million in the prior year.
On a segment basis, system-wide sales at Burger King grew 8.5 percent in constant currency, while comparable sales advanced 2.8 percent, RBI reported.
CEO Daniel Schwartz said the company’s focus on menu innovations helped RBI to better results in the fourth quarter compared to the third quarter.
“In the fourth quarter, we launched the Bacon King, a premium priced product that stayed true to our core, which was well received by our guests and helped drive incremental sales at our restaurants,” Schwartz told analysts during an earnings call on Feb. 13. “We also continue to grow our breakfast daypart, a part of which was driven by a successful pancake promotion during the quarter.”
Schwartz added that the company made more progress in re-imaging restaurants in the United States which has unified the Burger King identity. Other highlights include a number of new development agreements, the formation of a new master franchise/joint venture (MFJV) in Belgium and the successful completion of several Quick restaurant conversions in France are expected to drive future Burger King restaurant remodels and openings.
These accomplishments will lead to further growth opportunities to be realized in 2017 and beyond,” CFO Josh Kobza told analysts. “We remain dedicated to working closely with our existing and new partners to achieve sustainable long-term growth in their respective markets.”
Tim Hortons also contributed gains in comparable sales and system-wide sales. For the fourth quarter, comparable sales edged 0.2 percent higher in constant currency, while system-wide sales increased 2.4 percent.
Growth in the breakfast, lunch and dinner dayparts led by notable growth in the US business fueled system-wide sales growth.
“In summary, 2016 was a busy year, in which numerous development agreements were signed to pave the way for our international expansion plans in the brand,” Kobza noted. “Since the formation of RBI, we have announced Tim Hortons development agreements in the US and Cincinnati, Columbus, Indianapolis and Minneapolis, the latter two of which were announced in 2016. We are pleased with the progress our partners have made and we look forward to continuing to grow with them for years to come.“On the international front, we signed three MFJV agreements for the TH brand in the last 12 months; the Philippines, Great Britain and Mexico,” he added. “Mexico is the most recent MFJV agreements, having been announced only a few weeks ago. Our Mexican MFJV is very exciting to us as it marks the brand’s first entry into Latin America. The country has a quickly growing coffee market and is a great starting point for developing the brand across the rest of Latin America due to its cultural alignment with both North America and Latin America.”