Restaurant Manufacturers Worldwide (QSR) Q1 2023 outcomes

In this photo illustration, a Burger King Whopper hamburger is on display on April 05, 2022 in San Anselmo, California.

Justin Sullivan | Getty Images

Restaurant Brands International on Tuesday reported quarterly earnings and sales that beat analysts’ expectations, driven by double-digit same-store sales growth at Tim Hortons and Burger King.

Here’s what the company reported, compared to Wall Street expectations, based on a poll of analysts by Refinitiv:

  • Earnings per share: 75 cents adjusted vs. 64 cents expected
  • Revenue: $1.59 billion versus $1.56 billion expected

Restaurant Brands reported net income of $277 million, or 61 cents a share, in the first quarter, up from $270 million, or 59 cents a share, a year ago.

Excluding items, the company earned 75 cents per share.

Net sales increased 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 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 that the turnaround is taking hold domestically.

“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’s US President Tom Curtis told CNBC the chain was selling a record number of whoppers thanks to its new ad campaign and a whopper jingle that went viral on TikTok.

“Given these results, moderate cost inflation and our investment in the brand, coupled with strong operational leverage at the restaurant level, we are increasingly positive about BK’s journey this year and into the future,” Kobza told analysts on Tuesday.

The turnaround strategy also focuses on improving franchisee profitability. So far in 2023, two of Burger King’s US franchisees have filed for bankruptcy. Kobza said on the conference call that he expects more “short-term noise” as some sites transition into the hands of its top operators.

Tim Hortons same-store sales rose 13.8%, beating StreetAccount’s estimate of 10.1%. In Canada, its home market, the company reported same-store sales growth of 15.5%.

The Canadian coffee chain has had its own turnaround in recent years to revitalize sales in its home market. Restaurant Brands revamped Tim’s menu and loyalty program and upgraded their coffee brewing equipment. Its mobile app is now the second largest e-commerce app in Canada, just behind Amazon.

Popeye’s Louisiana Kitchen reported same-store sales growth of 5.6%, beating StreetAccount’s estimate of 4%. A year earlier it was reported that same-store sales were down 3%.

In January, the fried chicken chain brought back Ghost Pepper Wings for the first time in three years and sold out in two weeks. Executives said the wings encouraged customers to spend more, improved franchisees’ profit margins and attracted younger customers. The Ghost Pepper Wings returned Monday as a permanent addition to the menus.

Firehouse Subs, the latest addition to Restaurant Brands’ portfolio, posted 6.1% same-store sales growth for the quarter.

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