Operations

Popeyes, Burger King parent turns in disappointing Q4 sales

Photo: iStock

February 11, 2021

Popeyes, Burger King and Tim Hortons parent company, Restaurant Brands International, turned in disappointing fourth-quarter earnings results, which fell below analysts' expectations.

Traffic declines brought on by the pandemic led to a huge drop in net income. Last year's Q4 saw $165 million, which fell to $91 million this year. Adjusted earnings for the Toronto-based company fell below analysts' predicted average of 66 cents per share to 53 cents per share, according to SEC filings. Adjusted earnings for last year's quarter — ending Dec. 31 — were 75 cents a share.

RBI reported that its revenue for the period fell from $1.48 billion last year's quarter to $1.36 billion this year. Comp sales fell for all three brands, although Popeyes accrued the least damage of the bunch, with its sales falling 5.8% (compared to growth of 34.4% last year's quarter). Burger King comp sales dropped 7.9% for the quarter (compared to 3.4% growth last year's quarter), while Tim Hortons fell 11% (compared to a 1.5% drop last year's quarter).

Other key results for the quarter include:

Consolidated sales of $8.213 billion, compared to $8.9 billion the previous year's quarter.
Tim Horton quarterly systemwide sales of $1.478 billion compared to $6.716 billion last year's quarter.
Burger King quarterly systemwide sales of $5.428 billion, compared to $5.905 billion last year's quarter.
Popeyes quarterly systemwide sale of $1.307 billion, compared to $1.327 billion last year's quarter.
Total revenues of $1.358 billion compared to $1.479 billion last year's quarter.

Annual (12-month) results include:

Consolidated sales of $30.669 billion, compared to $34.034 billion the previous year.
Tim Horton systemwide sales of $5.488, compared to $6.716 billion the previous year.
Burger King systemwide sales of $20.038 billion, compared to $22.921 billion the previous year.
Popeyes quarterly systemwide sale of $5.143 billion compared to $4.397 billion the previous year.
Total revenues of $4.968 billion compared to $5.603 billion last year's quarter.

Despite the results, RBI CEO Jose Cil said he was confident in the company's future.

"While we ended 2020 with about the same restaurant count as 2019, we have been working closely with our network of franchisees on restarting the development engine and expect to deliver net restaurant growth roughly in line with what we delivered in 2018 and 2019," he said. "Strong results in 2021 will help pave the way toward our aspiration of achieving 40,000 restaurants in the coming years. Driving rapid digital innovation has been essential to the recovery of our business. We increased support for and continued to build on our e-commerce platforms, reimagined service opportunities like curbside pickup and expanded delivery services into thousands of new restaurants. The outcome has been the more than doubling of digital sales in North America."

"The quality of our plans today is the result of a team that refused to be distracted by short-term barriers that we couldn't control and instead focused on the right long-term priorities to grow our restaurant brands for many years to come."