Burger King Holdings Inc. said Thursday it swung to a net loss in its first quarter on charges from its going-private buyout in October, as well as negative same-store sales and reduced corporate revenue.
The owner of the No. 2 burger chain said cost-control efforts and a renewed focus on restaurant margins — driven by increased sales from new menu items and new pricing strategies — would be its focus moving forward.
The chain is looking to use its latest $1, $2, $3 BK Stacker promotion to maintain value recognition with the consumer, while also debuting new chicken tenders and a soft-serve ice cream offering, which is expected to hit U.S.-based units this summer.
“Our comparable sales growth performance and improvements to our company restaurant margins remain our top priority, particularly in North America, where we are focused on executing on the four priorities of our plan, which include operations, marketing, menu and image,” the company said in a statement.
Burger King has struggled of late, with first-quarter same-store sales falling 6 percent in the United States and Canada. One of the chain’s largest franchisees, Carrols Restaurant Group, said this week that repositioned marketing, new menu items, and a return to the promotion of the signature Whopper sandwich may help turn the tide in the second quarter.
For the quarter ended March 31, Burger King posted a net loss of $6.8 million, compared with a profit of $41 million in the same quarter a year earlier. The loss reflected increased interest expense, costs from restructuring and penalties for debt extinguishment.
Latest-quarter revenue fell 8 percent to $552 million. Systemwide same-store sales fell 2.8 percent, including a drop of 6 percent in the United States and Canada, and increases of 1.7 percent in the Europe, Middle East and Africa division, and 4 percent in Latin America.
Miami-based Burger King Holdings operates or franchises 12,301 locations worldwide.
Contact Sarah Lockyer at [email protected]
Follow her on Twitter: @slockyerNRN
