Restaurant Brands International said it plans to focus on restaurant remodels and operational efficiencies to drive sales at its Burger King brand, following third-quarter results that fell short of expectations.
Burger King's U.S. same-store sales were down .7 percent for the quarter ended Sept. 30. Sister brands Tim Hortons and Popeyes Louisiana Kitchen were up .9 percent and down .2 percent, respectively. Burger King's consolidated same-store sales were up 1 percent. Tim Hortons and Popeyes also saw modest consolidated same-store sales gains in the quarter, at 0.5 percent and 0.6 percent, respectively.
“Burger King continues to center around focusing on the following priorities: Restaurant image, technology, operations and marketing, each of which we believe will help drive sustainable comparable sales over the long run,” said CEO Daniel Schwartz during an earnings call Wednesday.
Specifically, the chain is pinning its hopes in the Burger King of Tomorrow restaurant image.
“Our Burger King of Tomorrow image contemplates upgrading our restaurants to our most recent garden grill design, which has benefited strong benefits in guest satisfaction and dine-in comparable sales,” Schwartz said during the company’s earnings call.
The brand has completed roughly 100 of the renovations, which are designed to create a more efficient drive-thru and a tech-driven customer experience. Hundreds more renovations are planned for the fourth quarter, the company said.
“With the majority of our restaurant-level sales generated in the drive-thru, our new image also includes exterior guest-facing enhancements, like the construction of double drive-thru lanes and outdoor digital menu boards. Double drive-thrus allow for significantly-improved throughput and speed of service.
“Outdoor digital menu boards drive increased check, allow for integration with other technologies like mobile apps and provide franchisees cost savings on printed media and menu signage," he added. This image is also focused on building a digitally-integrated experience for our guests, including the implementation of outdoor digital menu boards and in-restaurant self-order kiosks.”
During the call, Schwartz also emphasized the brand's delivery initiatives. The Burger King delivery program is available at nearly 2,000 restaurants in North America and over 5,000 restaurants around the world.
Net income for the quarter was $133.6 million, or 53 cents per share, up from $91.4 million, or 37 cents per share, in the same period a year earlier. Total revenues for the quarter were up $1.38 billion, up from $1.21 billion in the same quarter a year earlier.
Burger King currently has over 17,000 restaurants. Tim Hortons has over 4,800 units, and Popeyes Louisiana Kitchen has more than 3,000.
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