(Reuters) - Restaurant Brands International Inc (QSR.TO), (QSR.N) reported an unexpected drop in quarterly comparable-store sales at both coffee and doughnut chain Tim Hortons and fast-food chain Burger King, sending the company’s shares down nearly 8 percent.
Comparable sales for restaurants open for at least 13 months slipped 0.1 percent at both Tim Hortons and Burger King, Restaurant Brands said on Wednesday.
Analysts were expecting a 0.8 percent rise at Tim Hortons and a 1.5 percent increase in Burger King comparable sales, according to research firm Consensus Metrix.
The fall at Burger King was primarily due to a 2.2 percent drop in U.S. comparable sales, while Tim Hortons’ was impacted by a decline in Canada comparable sales.
Burger King’s U.S. comparable-store sales decline was slightly worse than our expectation and likely implies the chain underperformed the industry by 300 basis points, RBC Capital Markets analysts said in a client note.
However, the drop in comparable sales was offset by net restaurant growth of 5.1 percent at Burger King and 4.6 percent at Tim Hortons.
Restaurant Brands bought Popeyes Louisiana Kitchen for $1.8 billion in February to use its international reach to introduce Popeyes’ Louisiana-style fried chicken and buttermilk biscuits to more diners globally.
Popeyes revenues and segment income from the acquisition date of March 27 through March 31 were not material to Restaurant Brands’ results, the company said.
Net profit attributable to shareholders was $50.2 million in the first quarter ended March 31, largely unchanged from $50 million a year earlier.
Earnings per share was unchanged at 21 cents.
Excluding items, the company earned 36 cents per share, beating analysts’ average estimate of 35 cents, according to Thomson Reuters I/B/E/S.
Oakville, Ontario-based Restaurant Brands’ total revenue rose 8.9 percent to $1 billion (780.36 billion pounds), beating analysts’ average estimate of $990.3 million.
Reporting by Ahmed Farhatha in Bengaluru; Editing by Sriraj Kalluvila and Martina D'Couto