Restaurant Brands International's Strong Growth in System-wide Sales

By Bobby Samwell • Thursday, February 22 16:05 • Permanent Link

Restaurant Brands International Inc. has recently released its 10-K report, providing insights into its financial performance and operations for the year ended December 31, 2023. The company operates as a quick-service restaurant company with four segments: Tim Hortons, Burger King, Popeyes Louisiana Kitchen, and Firehouse Subs. It owns and franchises restaurants offering a variety of food and beverage products, including coffee, tea, donuts, burgers, chicken, and sandwiches.

Financial Metrics and Changes:

System-wide sales growth for Tim Hortons, Burger King, Popeyes, and Firehouse Subs in 2023 were 11.0%, 6.9%, 10.5%, and 7.1% respectively. This indicates an overall positive growth trend across all segments compared to the previous year.
Comparable sales for Tim Hortons, Burger King, Popeyes, and Firehouse Subs in 2023 were 10.4%, 7.4%, 4.8%, and 3.8% respectively, showing a consistent increase in sales for most segments.
Net restaurant growth for Tim Hortons, Burger King, Popeyes, and Firehouse Subs in 2023 were 0.1%, -3.3%, 4.9%, and 3.0% respectively, demonstrating varying growth rates across different segments.
The company's consolidated system-wide sales grew by 12.2% in 2023, reaching over $42.8 billion, compared to $38.7 billion in 2022 and $35.5 billion in 2021, indicating a steady increase in overall sales.
The total restaurant count for all segments reached 31,070 in 2023, compared to 29,902 in 2022 and 29,456 in 2021, reflecting continuous expansion.

Challenges and Macroeconomic Environment:

The company faced challenges related to increased commodity, labor, and energy costs, influenced by the macroeconomic impact of the War in Ukraine and residual impacts from COVID-19. These factors led to inflation, foreign exchange volatility, rising interest rates, and a general softening in the consumer environment.
The global crisis resulting from the spread of COVID-19 significantly impacted restaurant operations in 2022 and 2021, particularly in markets such as Canada and China, which experienced government-mandated lockdowns and restrictions on restaurant operations.

Overall, Restaurant Brands International Inc. exhibited positive financial performance and growth in system-wide sales and comparable sales across its segments in 2023, despite facing challenges related to macroeconomic factors and the lingering impacts of the COVID-19 pandemic. Today the company's shares have moved -0.4% to a price of $75.38. For more information, read the company's full 10-K submission here.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.