Restaurant Brands reports sales growth, encouraged by Tim Hortons

Restaurant Brands International (RBI) reported strong quarterly revenue on Thursday that beat analysts’ expectations. Sales were driven by robust sales at Tim Hortons and international locations. The company’s stock rose 3% in morning trading following the announcement.

In a conference call with analysts, CEO Josh Kobza acknowledged that while the company was aiming for higher revenue numbers, RBI outperformed major competitors in key markets. The company’s revenue for the quarter was $2.08 billion, beating the $2.02 billion expected. However, adjusted earnings per share fell slightly short of forecasts, coming in at 86 cents versus the 87 cents expected.

RBI’s net income rose to $399 million, or 88 cents per share, in the second quarter, compared with $351 million, or 77 cents per share, a year earlier. The 17 percent increase in net sales was due to recent acquisitions, particularly of Burger King restaurants in the U.S. The company’s comparable-store sales rose a modest 1.9 percent.

Leading the company’s performance was Tim Hortons, with comparable-store sales growth of 4.6 percent, helped by new offerings such as flatbread pizza and an expanded cold beverage menu. Popeyes reported a 0.5 percent increase in comparable-store sales, driven by the popularity of its new boneless chicken wings, while Burger King and Firehouse Subs posted slight declines of 0.1 percent.

Kobza noted that while Burger King’s revenue and traffic remained below expectations, the brand continues to outperform other fast-food burger restaurants and is undergoing significant changes as part of a broader turnaround strategy.

For the second half of the year, RBI expects comparable store sales growth of around 2%. The recent acquisition of Popeyes China will be reflected in the company’s next quarterly results.