Burger King Worldwide Inc. today reported financial results for the first quarter ended March 31.
Although earnings per share grew 49 percent in Q1, the brand turned in negative comparable sales of 1.4 percent globally. CEO Bernardo Hees attributed this in part to a challenging economic and competitive environment.
The company also announced the increase of its dividend by 20 percent and initiated a $200 million share repurchasing program. This, Hees said, demonstrates the company's long-term prospects.
"While comparable sales growth was not up to our expectations, we made progress toward achieving our target business model and remain committed to executing our Four Pillar strategy in the U.S. and Canada and driving net restaurant growth internationally," he said.
North American highlights
U.S. and Canada comparable sales growth of negative 3.0 percent in the first quarter was due to the comparison to a strong first quarter in 2012, a challenging macroeconomic environment and heightened competitive activity.
After negative comparable sales growth early in the quarter, comparable sales growth in the U.S. and Canada was positive in March, as the company took a more balanced approach to value and premium offerings. Value-oriented promotions such as the $1.29 Whopper Jr. and "2 for $5" specials were successful when paired with premium limited time offers such as the Chipotle Whopper and Chipotle Chicken sandwiches, according to the company. Additionally, Burger King launched a turkey burger for the first time in the brand's history, which was one of the best performing limited-time offers during the first quarter.
As part of BKW's global refranchising strategy, the company refranchised 33 company-owned restaurants during the quarter in the U.S. and Canada segment. In connection with the refranchising transactions, BKW received cash proceeds of $9.3 million, development commitments and re-imaging commitments.
Q1 2013 by the numbers:
- Global comparable sales growth fell 1.4 percent and systemwide sales increased 1.1 percent in constant currency;
- Adjusted Diluted EPS increased 49 percent to $0.17;
- Adjusted EBITDA increased 4.5 percent on an organic basis to $144.3 million;
- Adjusted EBITDA margin increased 1,890 bps to 44.0 percent; and
- Completed U.S. refranchising initiative.
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