The owner of Burger King and Tim Hortons said both chains suffered drops in a key sales figure in the first three months of the year amid fierce competition in the fast-food industry.
Restaurant Brands said new food items, such as Burger King's revamped fried chicken sandwich, were added too late in the quarter to affect sales. The loss of a leap-day this year also hurt sales, the company said.
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Sales fell 0.1 percent at Burger King's established locations in the first quarter compared with the same period a year ago. Sales at established Tim Hortons locations fell by the same amount. By contrast, Rival McDonald's this week said that its global sales rose 4 percent at established restaurants during the same period.
Shares of Restaurant Brands International Inc. fell $2.58, or 4.4 percent, to $55.89 in morning trading Wednesday.
Fast food restaurants have been trying to improve their offerings to attract customers. McDonald's, for example, has added all-day breakfast and said it would soon start making its Quarter Pounders with fresh beef instead of frozen. Besides the revamped Crispy Chicken sandwich, Burger King is also selling a shake made with Froot Loops cereal, and Tim Hortons has added espresso drinks to its menu in Canada. Restaurant Brands also plans to expand its recently-acquired fried chicken chain Popeyes outside the U.S.
Overall, the Oakville, Ontario-based company reported earnings that beat Wall Street expectations.
It had first-quarter net income attributable to shareholders of $50.2 million, or 21 cents per share, which was essentially flat from the same period a year ago.
Adjusted earnings came to 36 cents per share, beating Wall Street expectations of 35 cents per share, according to Zacks Investment Research.
The company said its revenue rose 9 percent from a year ago to $1 billion.
Elements of this story were generated by Automated Insights using data from Zacks Investment Research. Access a Zacks stock report on QSR at https://www.zacks.com/ap/QSR
Keywords: Restaurant Brands, Earnings Report