Restaurant Brands International sees same-store sales improvement in April | 2020-05-08

TORONTO – Comparable sales fell for both Burger King, down 3.7%, and Tim Hortons, down 10%, in the first quarter ended March 31, but executives at parent company Restaurant Brands International Inc. had bullish data to offer in a May 1 call result.

Digital usage and delivery is increasing amid the coronavirus (COVID-19) pandemic. Comparable sales in April improved from lows in March.

“In mid-March, we saw a sharp drop in comparable sales between brands and regions, coinciding with the global proliferation of COVID-19,” said José E. Cil, Managing Director of Restaurant Brands International (RBI) based in Toronto. “While many challenges remained in April and continue as we head into May, there is renewed optimism and confidence among our brand teams and restaurateurs as we have seen a strong improvement in comparable sales over the course of of April, small double-digit improvements for every brand in our home markets from the lowest levels we saw at the end of March. “

Joshua Kobza, COO of RBI, highlighted the growth in digital delivery and sales.

“From a base of a few hundred restaurants in North America delivered two years ago, we now have over 9,000 active restaurants across our three brands, most offering delivery through our own digital platforms as well as several aggregators, ”he said. noted.

He added that digital sales in domestic markets for the third week of April represented about 9% of total Burger King sales, 15% of total Popeyes sales and over 30% of total Tim Hortons sales.

Cil noted the time slot changes. Before COVID-19, people followed routines like going to work or taking children to school, he said.

“Times of the day like breakfast and snacks that fit into these routines saw a disproportionate decrease while lunch and dinner showed more strength,” Cil said. “Also, while we would typically see sales increase on Thursdays and continue at a higher rate throughout the weekend, we are now seeing better performance on weekdays, and although traffic has declined, we have generally seen a increase in the average size of checks due to more frequent bulk orders, both at drive and delivery.

Burger King’s overall sales fell 3% in the quarter to just under $ 5 billion. In the last two weeks of March, same-store sales fell by more than 30%, but the percentage decline fell to less than 20% at the end of April. Burger King’s drive-thru sales in the United States have been positive since the second week of April and are now up more than 15% year-over-year, Cil said.

“And on delivery, in the last few weeks of the quarter, we ramped up the rollout to several hundred restaurants, so we now have over 5,000 restaurants offering the service, most through multiple delivery partners as well as ‘Burger King mobile app,’ he said. .

To assist Burger King restaurant owners in the United States, cash advances on rebates were made immediately available up to $ 15,000 per restaurant.

Popeyes continued a hot streak that started with a chicken sandwich last year. Comparable sales increased 26% in the first quarter. Total sales increased 32% to $ 955 million. In the last two weeks of March, comparable sales were flat, but returned to pre-COVID-19 levels in late April. The average order size and number of tickets increased, particularly during dinner day due to orders for family meal packages.

Total Tim Hortons sales in the quarter fell 10% to $ 1.38 billion. In the last two weeks of March, same-store sales fell by more than 40%, but the percentage fell to less than 40% at the end of April. The Tim Hortons chain has grown from 250 restaurants offering delivery to more than 1,000 in less than two months, Cil said.

Company-wide, Restaurant Brands International posted first quarter net income of $ 224 million, or 48 per share, down 9% from $ 246 million, or 53 per share, in the first quarter of the previous year. Total revenue of $ 1.23 billion was down 3.3% from $ 1.27 billion.

All brands combined, more than 95% of American restaurants are open, Cil said. About 85% of Tim Hortons in Canada are open.

About half of restaurants in Europe, the Middle East, Africa and Latin America were temporarily closed due to COVID-19 at the end of the first quarter. In China, less than 10% of restaurants remain closed, Cil said.

RBI’s total debt was $ 13.4 billion as of March 31. Net debt, which is total debt less cash and cash equivalents, was $ 10.9 billion. The net leverage was 4.8x. The cash balance led the company to withdraw almost all of its $ 1 billion revolving credit facility in mid-March.

About Lolita Plowman

Check Also

Amesite (NASDAQ:AMST) vs. Lightspeed Commerce (NYSE:LSPD) Head to Head Review

Light trade (NYSE: LSPD – Get a rating) and Amesite (NASDAQ: AMST – Get a …

Leave a Reply

Your email address will not be published.