Restaurant Brands Stock Gains As Q2 Results Smash Estimates; Board Approves $1B Buyback

  • Restaurant Brands International Inc QSR reported second-quarter FY21 revenue growth of 37.2% year-on-year, to $1.44 billion, beating the analyst consensus of $1.15 billion. Consolidated System-wide sales growth was 31.9%.
  • Adjusted EPS of $0.77 beat the analyst consensus of $0.56.
  • Franchise and property revenue increased 36.4% Y/Y to $614 million, and advertising revenue rose 21.9% to $234 million.
  • Revenue from Tim Hortons (TH) segment rose 46.5% Y/Y to $831 million, Burger King (BK) increased 32.1% to $459 million, and Popeyes (PLK) expanded 10.4% Y/Y to $148 million.
  • Operating costs and expenses expanded 18% Y/Y to $950 million.
  • Adjusted EBITDA rose 61.2% Y/Y to $577 million. The operating margin was 33.9%, and operating income for the quarter rose 100.8% Y/Y to $488 million.
  • Restaurant Brands held $1.8 billion in cash and equivalents as of June 30, 2021. Net cash provided by operating activities amounted to $745 million for the six months. Net debt at the end of the quarter was $11.2 billion.
  • "We are encouraged by the momentum across our business – including sales increases driven by quality menu items, rapid adoption of our digital channels by our guests and an acceleration in new restaurant openings around the world by our franchisees who believe strongly in our brands and business model," said CEO José E. Cil.
  • Restaurant Brands announced an increase in its share buyback authorization to $1 billion over the next two years.
  • The company's dividend of $0.53 per share will be payable on October 5, 2021, to shareholders of record on September 21, 2021.
  • Price action: QSR shares traded higher by 2.07% at $66.24 in premarket on the last check Friday.
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