Burger King Worldwide on Friday announced that its first quarter profit more than doubled because of less expenses, which helped to offset negative sales in their same-stores and revenue that was lower. The company went public back in June of 2012 after it was acquired by 3G Capital a Brazilian private equity company in October of 2010. Since last June, Burger King has been making changes to its menu to help it better compete with its biggest rival McDonald’s.
Burger King’s first quarter profit was $35.8 million or $0.10 per share compared to last year’s profit during the same period of just $14.3 million or $0.04 per share. Revenue for the “Home of the Whopper” was lower by 42% and ended at $327.7 million, which was effected by global refranchising changes and weaker same-store sales than had been expected.
Revenues from comparable stores were down by 1.4% compared to an increase last year in the same quarter of 4.6%. In Canada and the U.S., revenue from same stores dropped by 3%, while in the Middle East, Africa and Europe growth was minimal at 0.8%. Store revenues in the Asia-Pacific region were up by 2.7%.
Operating costs and overall expenses fell by over 54% because of lower payroll and administrative expenses and the lower cost of food. However, franchise and property expenses increased during the quarter by over 53%.
Daniel Schwartz a Burger King executive will take the reins of CEO this July 1. Bernardo Hees, the current CEO, will step down at that time to take the CEO position at H.J. Heinz the maker of ketchup, which was acquired by Berkshire Hathaway and 3G Capital for $23 billion.
Get Analysts' Upgrades and Downgrades Daily - Enter your email address below to receive a concise daily summary of analysts' upgrades, downgrades and new coverage with MarketBeat.com's FREE daily email newsletter.