Burger King's parent company to invest $300 million more to modernize restaurants

By Emily Bary

Stock rallies as profit, sales and same-store sales all beat expectations, amid strength at Popeye's and Tim Hortons

Restaurant Brands International Inc. edged past earnings expectations with its latest results on Tuesday while announcing plans to invest further in Burger King remodels.

In September 2022, the company laid out plans to spend $250 million for remodels and relocations of Burger King restaurants. On Tuesday, the company said it would invest an additional $300 million from 2025 through 2028 to modernize the restaurants. That will put the chain on track to have 85% to 95% of its restaurants representing the "modern image" by 2028.

"We are committed to giving our guests the very best experience in all our restaurants and that includes a modern, exciting restaurant image and digital experience that exceeds their expectations," said Tom Curtis, president of Burger King North America.

The stock (QSR) rose 2.6% in premarket trading, which puts it on track for the biggest one-day post-earnings gain since Aug. 4, 2022.

The company reported first-quarter net income of $328 million, or 72 cents a share, compared with $277 million, or 61 cents a share, in the same period a year ago.

On an adjusted basis, Restaurant Brands posted 73 cents a share in earnings, down from 75 cents a share in the year-earlier quarter, but above the FactSet consensus of 72 cents a share.

Total revenue grew to $1.74 billion from $1.59 billion a year before, while analysts were modeling $1.70 billion.

Consolidated comparable-store sales, or sales from restaurants open more than a year, rose 4.6%, to beat the FactSet consensus for 3.7% growth.

Among the company's restaurant brands, Burger King's same-store sales rose 3.8% but missed the FactSet consensus of a 4.1% rise, while Popeye's Louisiana Kitchen's same-store sales growth of 5.7% beat expectations of 4.3% growth. Tim Hortons's same-store sales jumped 6.9% to beat forecasts of a 5.7% rise.

Overall sales for Burger King were up 2.6% to $2.75 billion. Tim Hortons's sales rose 7.8% to $1.73 billion and Popeye's sales climbed 10.4% to $1.52 billion.

The stock has lost 5.5% year to date through Monday, while the S&P 500 index SPX has gained 7.3%.

-Emily Bary

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

04-30-24 0841ET

Copyright (c) 2024 Dow Jones & Company, Inc.