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Burger King 2Q net falls 12.7%

Burger King Holdings Inc. posted second-quarter results including declines in sales and profit, leading executives to discuss major menu changes aimed at broadening BK’s consumer appeal.

Jonathan Fitzpatrick, Burger King’s chief brand and operations officer, revealed on a conference call Thursday that testing of a variety of new products — such as smoothies, parfaits, salads and oatmeal — began about 30 days ago at 100 locations. The menu testing phase also includes crew training and new equipment, he said.

Fitzpatrick said between 20 percent and 35 percent of the Burger King menu could consist of new products a year from now.

EARLIER: BK’s menu overhaul goes beyond burgers

The moves come at a time of consistently sluggish sales for the No. 2 burger brand, behind McDonald’s.

For the quarter ended June 30, Burger King’s net income declined 12.7 percent to $42.8 million. Miami-based Burger King cited the interest on the debt that was incurred from its sale to 3G Capital in October 2010, and $12 million in transaction costs for the drop in profit.

Second-quarter revenue fell 4 percent to $596.2 million, which the company attributed to its refranchising activity and negative same-store sales. In U.S. and Canadian markets same-store sales fell 5.3 percent. Abroad, same-store sales rose 6.8 percent in Latin America and 2.2 percent in the Europe, Middle East, Africa and Asia Pacific division.

Some of the first, new BK products include soft-serve ice cream, which will be rolled out in the United States in a month, executives said.

Contact Alan Snel at [email protected].
Follow him on Twitter: @AlanSnelNRN

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