The company is dedicated to modernizing its system, CEO Josh Kobza said on Q4 call with analysts
Restaurant Brands International Inc., parent to the Burger King system, plans to continue its Burger King modernization and work on speed of service at its Time Hortons brand, executives said Wednesday.
“Our commitment to modernizing the Burger King system remains very strong,” Josh Kobza, RBI CEO, said in a Wednesday call with analysts after releasing earnings for the fourth quarter ended Dec. 31. “In 2024, we completed 370 remodels including about 60 Carroll's restaurants, bringing the system to 51% modern image.
“We have about 220 remodels that have been open for more than six months now and they continue to deliver an average of mid-teens year-one sales uplift net of control and even stronger improvements in franchisee profitability,” Kobza said. “We're on track to reach 85% plus modern image by 2028, and we are confident this transformation will further strengthen Burger King's position in the industry.”
RBI completed its acquisitions of Carrols Restaurant Group Inc., its largest Burger King franchisee, last May 16. On June 28, it acquired PLK China.
Following the Carrols and PLK China acquisitions, RBI established a new operating and reportable segment, Restaurant Holdings, which includes results from the Carrols Burger King restaurants and the PLK China restaurants.
Burger King is continuing to work on its multi-year "Reclaim the Flame" plan, first announced in 2022, to accelerate sales growth and drive franchisee profitability. This plan includes investing up to $700 million through year-end 2028, comprised of advertising and digital investments ("Fuel the Flame") and remodels and relocations, restaurant technology, kitchen equipment, and building enhancements ("Royal Reset").
The Fuel the Flame investments were completed in the fourth quarter. As of Dec. 31, RBI had funded $133 million out of up to $550 million planned toward the Royal Reset investments.
The company has built about 80 of its Sizzle prototype Burger King units, Kobza said.
“We're thrilled with the early results and excited to see how these restaurants will inspire both our franchisees and our guests with a transformed Burger King experience,” he said.
At Tim Hortons, RBI continues to work on speed of service. It has units that do 28 seconds per car in the drive-thru, Kobza said, and that helps profits.
“This solidifies times as one of the fastest drive-thru concepts in North America,” he said. “With the teams’ consistent focus on speed of service and enhancing guest satisfaction, boosting throughput, and driving sales, we estimate every one second reduction in drive through translates to approximately $30,000 of incremental annual sales per restaurant.”
For the fourth quarter ended Dec. 31, RBI’s net income was $361 million, or 79 cents a share, compared to $736 million, or $1.60 a share, in the prior-year period. Revenues were $2.296 billion compared to $1.82 billion in the same quarter a year ago.
Global same-store sales increased 2.5% in the fourth quarter. By reporting segment, Tim Horton’s same-store sales were up 2.2% in the United States, Burger King U.S. were up 1.5%, Popeyes U.S. up 0.1%, Firehouse Subs U.S. flat, and international units (which covers 15,639 restaurants) up 4.7%.
Restaurant Brands International has more than 30,000 restaurants in more than 120 countries and territories. Its brands include: Tim Hortons, Burger King, Popeyes Louisiana Kitchen and Firehouse Subs. It reports the international restaurants and the Carrols-Popeyes China segments separately.
Contact Ron Ruggless at [email protected]
Follow him on X/Twitter: @RonRuggless
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