Connect with us

Business

Burger King parent's earnings top estimates, fueled by digital sales growth – CNBC

Published

 on


In this article

A Burger King restaurant seen in Milton, Pennsylvania.
Paul Weaver | SOPA Images | LightRocket | Getty Images

Restaurant Brands International on Tuesday reported quarterly earnings and revenue that topped analysts’ expectations as digital orders made up nearly a third of the company’s global sales.

Shares of the company rose more than 4% in morning trading.

Here’s what the company reported for the quarter ended Dec. 31 compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

  • Earnings per share: 74 cents adjusted vs. 70 cents expected
  • Revenue: $1.55 billion vs. $1.5 billion expected

The restaurant company reported fourth-quarter net income of $261 million, or 57 cents per share, up from $138 million, or 30 cents per share, a year earlier.

Excluding items, Restaurant Brands earned 74 cents per share, beating the 70 cents per share expected by analysts surveyed by Refinitiv.

Net sales rose 14% to $1.55 billion, topping expectations of $1.5 billion. Higher prices across its brands helped boost sales, and the company plans to keep hiking prices in 2022 to fight inflation.

The company said global digital sales climbed from $6 billion in 2020 to $10 billion in 2021, accounting for 30% of its system-wide sales. Its strong digital growth came as some of the company’s restaurants faced labor challenges, leading to reduced operating hours and shuttered dining rooms. More than half of sales in international markets came from digital orders in the fourth quarter, while home markets for Tims, Burger King and Popeyes were further behind.

Tim Hortons reported same-store sales growth of 10.3% in the quarter, falling shy of StreetAccount’s 10.6% estimate. The Canadian coffee chain has taken longer than Restaurant Brands’ other chains to bounce back from the pandemic because of its home market’s restrictions. And even before the health crisis, the chain was investing in new coffee-making equipment and revamping its menu to encourage Canadians to return to its stores.

A collaboration with Canadian singer Justin Bieber helped fuel Tims’ same-store sales growth in the quarter. The partnership included three flavors of Timbits, renamed Timbiebs for the collaboration. Executives said it was one of the top-performing promotions in recent memory.

“I’m a Belieber, and you can expect to see more from this exciting partnership in the years ahead,” Restaurant Brands CEO Jose Cil said on the company’s earnings call.

As the Canadian market matures, Tims has been expanding internationally. It opened its 400th location in China in January, less than three years after it opened its first restaurant there. The chain plans to add to its U.S. footprint, anticipating that it will open its first location in Houston this summer. New U.S. stores have smaller footprints and a more concentrated menu.

Burger King’s same-store sales climbed 11.3%, topping StreetAccount’s estimates of 10%. But U.S. same-store sales growth was just 1.8%. The burger chain has been struggling in its home market, outpaced by rivals like McDonald’s.

The chain completed a first wave of menu cuts in late December to speed up drive-thru times. So far, it hasn’t had any impact on Burger King’s same-store sales, executives said. Burger King has also been eliminating paper coupons in favor of mobile app deals and its loyalty program rewards.

Tom Curtis, president of Burger King U.S. and Canada, said the chain is reviewing its creative and media accounts. Restaurant Brands plans to present a broader plan for Burger King’s U.S. business later this year.

Popeyes Louisiana Kitchen was the only chain to report same-store sales declines. The fried chicken chain’s same-store sales shrank 0.4% globally and 1.8% in the U.S. A year earlier, its global same-store sales fell 5.8%. The popularity of its chicken sandwich helped the chain’s sales soar in 2019 and early 2020, but sales may finally be stabilizing. Wall Street was predicting same-store sales growth of 2.2% for the chain, according to StreetAccount estimates.

“Ongoing labor challenges led to reduced operating hours and service modes, impacting comparable sales by roughly 1%,” Cil said. “In addition, chicken sandwich volumes remain pressured by competitors, which as you may recall, started making their sandwich debuts in early 2021.”

Firehouse Subs, the newest addition to Restaurant Brands’ portfolio, saw its same-store sales climb 14.7% in the quarter. Restaurant Brands bought the sandwich chain in mid December for $1 billion, so its performance was only included in financial results from Dec. 15 to Dec. 26.

Read the full press release here.

Adblock test (Why?)



Source link

Continue Reading

Business

If Elon Musk scraps Twitter deal, here's what may happen to the stock – Yahoo Canada Finance

Published

 on


Twitter investors should brace for an all-out crash in the stock price if Tesla CEO Elon Musk abandons his bid for the social media platform, warns one veteran tech analyst.

In the absence of a bid, we would not be surprised to see the stock find a floor at $22.50,” said Jefferies analyst Brent Thill said Tuesday in a new note to clients. Such a price would be about 40% lower than Twitter’s current trading level.

Musk’s outstanding deal for Twitter is for $54.20 a share.

The path is being cut for that price put forth by Thill for Twitter shares, by Musk’s own doing.

In an early morning Tweet, Musk said “Yesterday, Twitter’s CEO publicly refused to show proof of <5%,” adding that “this deal cannot move forward until he does.”

The new tweet from Musk arrives after a tense exchange on the social media platform on Monday.

Twitter CEO Parag Agrawal wrote a long tweet thread to try to counter Musk’s claims the platform was chock full of fake accounts.

“We suspend over half a million spam accounts every day, usually before any of you even see them on Twitter,” Agrawal said in the 13-tweet thread. “We also lock millions of accounts each week that we suspect may be spam — if they can’t pass human verification challenges (captchas, phone verification, etc).”

Musk responded with a poop emoji.

Musk, the world’s richest person on paper, then followed up 14 minutes later with: “So how do advertisers know what they’re getting for their money? This is fundamental to the financial health of Twitter.”

Thill says Musk is simply trying to negotiate a lower price for Twitter. A fair value for Twitter in light of the rout in tech stocks in recent months would be $42 a share, Thill estimates.

Other analysts on Wall Street think a deal doesn’t get done.

“The chances of a deal ultimately getting done is not looking good now and it’s likely a 60%+ chance from our view Musk ultimately walks from the deal and pays the breakup fee,” Wedbush tech analyst Dan Ives said in a note to clients.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

Read the latest financial and business news from Yahoo Finance

Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube

Adblock test (Why?)



Source link

Continue Reading

Business

Why You Can’t Just Order Baby Formula From Canada – Lifehacker

Published

 on


Image for article titled Why You Can’t Just Order Baby Formula From Canada
Photo: The Toidi (Shutterstock)

With baby formula continuing to be in short supply, parents of infants are looking for creative ways to get their hands on that precious Enfamil—but a simple, seemingly ingenious solution that’s going viral right now will not work as described. The suggestion that’s spreading on Facebook and Twitter advises parents to go to Amazon and change their account’s country from the U.S. to Canada.

The claim is that if you do this, you will be rewarded with all kinds of baby formula-purchasing options—because Canada doesn’t have a major formula shortage. The problem, however, comes when you want to get the formula (or anything else) actually delivered from Amazon Canada. The company will only ship products within Canada, so unless you have a friend in Manitoba, it’s not going to work.

Amazon’s shipping restrictions page says:

Certain restrictions prevent us from shipping certain products to all geographical locations. Restrictions for specific items may require the purchaser to provide additional information in order to ship the item.

You might be able to find a third-party formula shipper on Amazon, but this is expensive in terms of shipping costs, and it might not be legal, depending on the kind of formula being imported.

The FDA’s role in all this

The larger issue of why the U.S. as a nation doesn’t import more baby formula is more complicated than Amazon’s rules. Only about 2% of the U.S.’s formula comes from foreign sources. February’s recall from major manufacturer Abbott threw off our delicate national formula supply chain, and correcting the problem presents some serious challenges.

If it was some other commodity, maybe more could have been imported quickly, but we’re particular about our baby formula. Formula has to meet the FDA’s nutritional standards and other requirements to be sold here. While European brands of formula generally meet or exceed the FDA’s nutritional requirements, (so much so that there’s a black market for foreign formula) the packaging and other aspects of the products are a different story.

The recall and FDA approval is only part of the story—the rest is economics.

Tariffs and dairy protection

In order to protect the U.S. dairy farming industry and U.S. formula manufacturers, the tariff on importing baby formula is set at 17.5% for most kinds of infant formula. The recently revamped NAFTA agreement actually raised the cost of importing Canadian formula, discouraging anyone from building a new plant there, and making it costly to import any excess from Canadian factories.

Light at the end of the tunnel?

While there’s no way to change tariffs quickly, the government is taking other steps to try to end the crisis. The FDA this week announced plans to ease the shortage through loosening up some of its rules (but not the ones covering nutritional requirements), and Abbot today announced its facility should be back online, with new safety standards in place, in a couple weeks.

Adblock test (Why?)



Source link

Continue Reading

Business

NS gas prices jump by 9.5 cents – CTV News Atlantic

Published

 on


Tuesday was another record-breaking day for gas prices in Nova Scotia after they jumped by 9.5 cents overnight — just four days after they had reached $2 per litre in some parts of the province.

The minimum price of regular self-serve is now $2.08 per litre in the Halifax area, or Zone 1. The new maximum price is $2.10.

The biggest jump was in Cape Breton, or Zone 6, where the minimum price of regular self-serve gas is now $2.10 per litre. The maximum price is $2.12.

There were long lineups at some Nova Scotia gas stations Monday night after the Utility and Review Board announced that it would invoke its interrupter clause at midnight.

The price of diesel did not change Monday. However, the UARB said Tuesday that it would invoke the interrupter clause, and the price of diesel oil would be adjusted at midnight.

The price of gasoline won’t be affected by the adjustment.

The UARB said the price adjustments are “necessary due to significant shifts in the market price” of gasoline and diesel.

Gas prices are showing no signs of letting up as the average price in Canada tops $2 a litre for the first time.

Natural Resources Canada says the average price across the country for regular gasoline hit $2.06 per litre on Monday for an all-time high.

The average was a nine-cent jump from the $1.97 per litre record set last week, and is up about 30 cents a litre since mid-April.

Gas prices have been climbing steadily since late February when oil spiked to around US$100 a barrel after Russia invaded Ukraine. The price jumped to over US$110 per barrel last week.

Record-high gas prices fuel frustration

When Sam Vatcher saw the price at the pumps in Halifax this morning, she was shocked.

“I don’t know how anyone is going to drive anywhere,” said Vatcher.

The latest prices have SUV driver Bill Foster wondering how he will be able to afford fuel going forward.

“I’ve got to get kids to sports and I’ve got to get kids to school,” said Foster. “Other stuff is going to have to get cut out just to pay for gas.”

In addition to the conflict in Ukraine, gas analyst Patrick Dehaan says the high gas prices are also largely linked to the pandemic.

“Canadians and Americans’ global consumption plummeted along with oil prices,” said Dehaan. “To the degree that oil companies started shutting down production. That was the problem.”

Dehaan said, during the pandemic, oil production went offline. Then, as the economy reopened, Canadians started leaving their homes and travelling more.

“Global demand started going back up,” he explained. “But because of the shutdowns, we very quickly developed an imbalance between supply-and-demand that has grown over time.”

As a result, some feel Canadian consumers will move away from oil and gas in favour of electric vehicles.

Electric vehicle advocate Kurt Sampson says he tells his children every day, “when you are older, and when you grow up it will be the opposite. Everybody will be driving electric vehicles.”

Sampson has an app on his phone that tracks fuel savings. By switching to an electric vehicle and not purchasing gas, he is on pace to have yearly savings in the range of $8,000.

“Electric vehicles are cheaper to own and operate,” said Sampson. “If you do the long-term calculation, not just a sticker price, they will save you money. They are also better for the environment.”

Sampson said drivers are increasingly switching to electric vehicles, and with fuel prices continuing to climb, he expects the trend to increase even more in the coming years.

Adblock test (Why?)



Source link

Continue Reading

Trending