News

Burger King opens 125 net new units in Q2

August 1, 2013

Burger King Worldwide Inc. reported financial results for the second quarter ended June 30. Highlights included a global comp sales increase of 0.6 percent, a sequential improvement from a 1.4 percent decline in Q1. Systemwide sales increased 2.8 percent in Q2.

Burger King's net restaurant growth was 125 units during the quarter, a 78.6 percent increase from the prior year.

CEO Daniel Schwartz said comp sales were driven by strength in the EMA and APAC regions.

"We continued to accelerate international growth with 125 net restaurant openings, primarily in China, Turkey, Russia and Brazil, which could not have been possible without the solid execution of our experienced joint venture and master franchisee partners on the ground," he added.

Additionally, the company refranchised 305 restaurants, which nearly completes its strategy to become a fully-franchised model.

By market

System comp sales in Q2 were:

• U.S. and Canada, down 0.5 percent;
• EMEA, up 2.9 percent;
• LAC, down 2.2 percent; and
• APAC, up 3.9 percent.

Net unit growth in each market was as follows during Q2:

• U.S. and Canada, closed 31;
• EMEA, opened 71;
• LAC, opened 26; and
• APAC, opened 59.

Highlights for U.S. and Canada

The company attributed the 0.5 percent sales decline in the U.S. and Canada to a "challenging macroeconomic environment, heightened competitive activity and a strong prior year comparison as we lapped the largest expansion of menu items in the brand's history," Schwartz said.

Traffic, however, was driven by value initiatives such as the $1.29 Whopper Jr. and 50-cent soft serve cone specials, as well as LTOs such as the Summer BBQ menu.

Schwartz said 40 percent of the U.S. and Canada system will be in the company's new restaurant image by 2015.

"We are encouraged that franchisees continue to sign up to complete remodels, reflecting the attractive sales uplifts that they have experienced from the initiative," he said.

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