Burger King parent Restaurant Brands International Inc. is looking to grow traffic and its franchised restaurant-unit count, executives said Tuesday.
The Toronto-based quick-service company, which also owns the Tim Hortons, Popeye’s Louisiana Kitchen and Firehouse Subs brands, reported solid earnings for the second quarter ended June 30.
Patrick Doyle, RBI executive chairman for the past nine months, said on an earnings call that Tim Hortons Canada and the brands’ international business were strong, with order and ticket growth.
However, the home markets for Burger King U.S., Popeyes U.S. and Firehouse Subs saw a second quarter with order counts flat to slightly negative.
“Ultimately bringing in more customers over time is the best measure of the strength of a brand’s comparisons,” Doyle said. “Order counts will get easier in the second half, but we need consistent growth across each of our brands and businesses.”
Distilling opportunities in each of the brands, Doyle added, was dependent on the P.M. daypart and broadening beverage offerings at Tim Hortons, improving operations and modernizing Burger King U.S., providing operational and kitchen improvements at Popeyes U.S. and developing Firehouse Subs domestically and internationally.
Doyle said Tim Hortons Canada remains strong, and opportunities remain for the Burger King U.S. business.
“It's about operational execution, modernization,” he said of Burger King U.S. “All the fundamental work the team and franchisees have done is paying off, led by wins in both operations and marketing. We already have our $400 million 'Reclaim the Flame’ investment being put to work, and I think that long term there is more we will consider doing especially around digital-centric remodels.”
At Popeyes in the U.S., “we're focused on easy — making our restaurants easy to run, our food easy to crave and our products easy to access.,” he added.
“As part of our easy to love plan,” Doyle added, “we're committing to redesigning the kitchen, and we unveiled the new kitchen remodel at our franchisee convention earlier this summer. We have a handful of locations that already have this in place.”
The corporate team is working with franchisees to gather feedback on Popeye’s simplified kitchens, he said.
As for Firehouse Subs, Doyle said, “You'll see a ramp up in our home market starting in 2024 as we look to the rest-of-world opportunities. The focus is on accelerating development with quality partners and generating great returns for those partners.”
Firehouse Subs recently opened its first overseas restaurant in Zurich, Switzerland, he said.
Josh Kobza, RBI CEO, said the Swiss “restaurant offers guests the Firehouse menu we know and love with a reimagined guest-centric restaurant design, including 100% digital ordering, and serves as a great showcase for future international development opportunities.”
Firehouse Subs fell victim to the NCR-Aloha ransomware attack in April, Kobza noted.
“This resulted in several Firehouse sales channels being down throughout April and May,” Kobza explained. “We and our franchisees are disappointed by the impact of the business and slow recovery by our vendor partner but are highly focused on improving system resilience for guests and our restaurant team members.”
All four concepts, Doyle said, are showing momentum. “I am confident we will get our net restaurant growth to the 5% plus level in 2024 and beyond,” he said.
For the second quarter ended June 30, RBI’s net income was $351 million, or 77 cents a share, up slightly from $346 million, or 76 cents a share, in the same period last year. Revenues rose to $1.775 billion from $1.639 billion in the prior-year quarter.
RBI’s consolidated same-store sales increased 9.6%, with growth of 12.5% at Tim Hortons Canada, 8.3% at Burger King U.S., 4.2% at Popeye’s U.S. and 2.6% at Firehouse Subs U.S.
As of June 30, Restaurant Brands International had 30,125 restaurants in more than 100 countries. Those restaurants included 18,935 Burger Kings, 5,662 Tim Hortons, 4,269 Popeyes and 1,259 Firehouse Subs.
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