MIAMI Burger King Holdings Inc. said Wednesday that it would use the “strong and consistent cash flow” expected this fiscal year to fund share repurchases, debt repayment and a shareholder dividend.
The parent of the No. 2 burger brand, with a system of more than 11,200 namesake units worldwide, said its cash flow also would allow the company to increase capital expenditures to build and remodel corporate restaurants.
The comments from Burger King chief financial officer Ben Wells came on the heels of a fourth-quarter report last week that boasted improved profit, revenues and same-store sales, but left investors nervous about fiscal 2008 projections, especially related to corporate spending. Burger King’s fiscal 2008 began July 1.
During its earnings report, the company had said it planned to build and remodel more restaurants in its current fiscal year than it had in past years, when the company had been focused on closing underperforming units. After its fourth-quarter report on Aug. 24, Burger King shares fell 3.5 percent.
“We are committed to using our strong and consistent cash flow that is forecasted during fiscal 2008 to increase shareholder value,” Wells said in a statement. “At the same time, we believe that our substantial cash flow will enable us to increase our capital spending to build and remodel company restaurants that are expected to generate significant returns and grow the brand.”
The company’s board declared a regular quarterly dividend of 6.25 cents per share. The dividend is payable on Sept. 28 to shareholders of record as of Sept. 14.
