Restaurant Brands tops sales estimates as Burger King deals draw diners
Oct 29 (Reuters) - Restaurant Brands International, beat Wall Street estimates for third-quarter comparable sales on Thursday, as value meals and new menu items drew more diners to its Burger King outlets
Value deals such as Whopper Wednesday, "2 for $5" and "3 for $7," alongside marketing campaigns and new drinks like matcha, have attracted diners who might otherwise eat at home, helping the company buck an industry-wide slowdown that has hurt sales at rivals including McDonald's and Wendy's.
Comparable sales at Burger King's US restaurants rose 8.4% in the quarter ended September 30, compared with a 3.2% rise a year earlier. The company's overall comparable sales of 3.8% beat analysts' estimates of 3.25%, according to data compiled by LSEG.
Burrito chain owner Chipotle Mexican Grill also beat third-quarter comparable sales estimates, helped by marketing efforts and limited-time menu items.
Burger King is investing up to $700 million through 2028 under its multi-year "Reclaim the Flame" plan to boost sales and franchisee profitability. Up to $550 million of that goes to "Royal Reset," a program of remodels, restaurant technology and kitchen equipment.
As of September 30, the company had funded $198 million of it.
Meanwhile, quarterly comparable sales at its Tim Hortons chain rose 1.8% in Canada, up from 0.1% in the second quarter. Comparable sales in its Popeyes Louisiana Kitchen business fell 2.2%, after declining 5.2% in the second quarter.
The company has been raising menu prices in the low-single-digit percentages to offset higher costs for commodities such as beef, it had said in its second-quarter earnings call.
Adjusted earnings per share for the third quarter were $1.10, up from $1.03 a year earlier. Analysts had expected $1.09 per share.
Third-quarter revenue of $2.53 billion came in slightly below analysts' estimates of $2.54 billion.
(Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Jonathan Ananda)