Restaurant Brands International Inc., the owner of Burger King and Tim Hortons, reported first-quarter comparable-store sales that topped analysts’ estimates, helped by new items such as hot dogs.
Same-store sales rose 4.6 percent at Burger King, the Oakville, Ontario-based company said in a statement on Thursday. Analysts projected a 3.2 percent increase, according to Consensus Metrix.
New grilled hot dogs and meal deals have helped Burger King boost same-store sales in a fiercely competitive fast-food market. McDonald’s Corp. and Wendy’s Co. both have advertised steep discounts, such as two sandwiches for $5. Burger King recently introduced chicken fries rings and brought back a deal on chicken nuggets -- a 10-pack for $1.49.
“Despite the competitive environment, we do see quite an opportunity to grow Restaurant Brands’ presence in the U.S.,” Chief Executive Officer Daniel Schwartz said in an interview. Along with new items, breakfast at Tim Hortons and Burger King is growing and helped drive first-quarter results, he said.
Still, revenue fell 1.6 percent to $918.5 million and trailed analysts’ average estimate of $928.2 million. Profit, excluding certain items, was 21 cents a share, compared with analysts’ average projection of 22 cents.
Restaurant Brands rose 1.6 percent to $43.10 at 9:49 a.m. in New York. The stock had gained 14 percent this year through Wednesday.
Tim Hortons comparable-store sales increased 5.6 percent. Analysts estimated a 4 percent gain. Beverages and grilled wraps helped fuel sales, and the chain is now advertising Nutella-filled cookies and iced coffees. Burger King bought Tim Hortons in 2014 for about $11 billion and is trying to expand the chain overseas and in the U.S.
The company also is pushing Burger King’s expansion abroad and is planning to double its restaurants in Japan. The chain will grow from about 98 stores to 200 by the end of 2017 and expects sales to grow 15 percent this year in Japan, Burger King Japan’s Chief Executive Officer Yasuyuki Murao said in an interview recently.