OAKVILLE Ontario Citing bad weather and earlier observation of Easter, bakery-cafe chain Tim Hortons Inc. reported first quarter results on Thursday that fell below both company and analyst expectations. The company also said Thursday that it had "streamlined" its management.
For the first quarter ended March 30, the company posted net income of $61.8 million Canadian ($60.5 million U.S.), or 33 cents a share, compared with $59.3 million Canadian ($51.4 million U.S.), or 31 cents a share, in the year-ago quarter. Analysts polled by Thomson Financial on average had expected a profit of 36 cents a share.
Total revenue rose 8.4 percent to $460.3 million Canadian ($450.4 million U.S.), the company reported. That reflected a 9.9-percent revenue increase for Canadian units and a 7.05 percent dip in revenues generated by U.S. locations.
Same-store sales at Canadian units rose 3.5 percent year-over-year for the quarter, Tim Hortons said. U.S. locations posted a 1.0 percent bump in same-store sales.
"Our first-quarter performance was below our full-year targets, but we expected a challenging quarter and have continued confidence in our ability to meet our sales growth targets for the full year," said Don Schroeder, president and CEO of Tim Hortons.
Also on Thursday, Tim Hortons announced a corporate restructuring that it said would streamline management and save the company an estimated $1.5 million a year after recording a one-time restructuring charge of about $3.8 million in the ongoing second quarter.
The restructuring included several executive promotions, along with changes below the management level that the company did not detail.
Roland Walton was promoted to chief operations officer for the Canada division. He had been executive vice president of operations, according to Tim Hortons' website. David Clanachan was named COO for the U.S. and international divisions after serving as executive vice president of training, operations standards, and research and development.
Bill Moir was promoted to chief brand and marketing officer from his previous role as executive vice president of marketing. He also was named president of the Tim Horton Children's Foundation.
Tim Hortons also said it had expanded chief financial officer Cynthia Devine's responsibilities to include oversight of the company's manufacturing operations.
Tim Hortons, based in Oakville, Ontario, operates or franchises 2,839 units in Canada and 399 in the United States. Most of the company's stores are franchised.
