Burger King, Tim Hortons Parent Restaurant Brands Sees Slowing First-Quarter Comparable Sales

Restaurant Brands International (QSR) reported slowing comparable-store sales across its Burger King, Tim Hortons and Popeyes chains on Monday as the company’s first-quarter results came in mixed.

Total revenue rose to $1.27 billion from $1.25 billion in the same period of 2018, in line with the consensus on Capital IQ. But adjusted earnings fell to $0.55 per share from $0.66 a share previously, three cents shy of the Street’s expectations.

Shares were down more than 5% in pre-market trading.

For coffee chain Tim Hortons, comparable sales contracted 0.6% from a 0.3% decrease in the same period of last year, while revenue fell to $749 million from $763 million previously. Burger King’s comps slowed to 2.2% growth from 3.8% expansion a year earlier, while revenue rose to $411 million from $390 million.

Popeyes’ comparable sales growth was just 0.6% from 3.2% a year earlier, with revenue at $106 million from $101 million previously.

Still, Chief Executive Jose Cil said system-side sales growth was strong at Burger King and Popeyes, driven by growth in restaurants and “reflecting the strength of our brands and business model around the world.”

System-wide sales, a measurement of the percentage change in sales at all franchise and company-owned restaurants year-on-year, rose 8.2% at Burger King compared with 11.3% a year earlier, and Popeyes was up 6.8% against 10.9% previously. Tim Hortons system-wide sales were up just 0.5% from 2.1% a year earlier.

“Underlying fundamentals at Tim Hortons remain strong and we are excited about our first three restaurants in China,” Cil said. “Overall, we are confident in the long-term growth prospects for each of our three iconic brands, and remain focused on providing a great guest experience while driving franchisee profitability.”

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