In a November 3rd release, Restaurant Brands International Inc. (QSR) posted financial results for the 3rd quarter of fiscal 2023. Along with other QSRs and casual dining competitors, the Company and its franchisees among four operating divisions are subject to the pressures of increased costs for food, packaging and labor in a competitive environment restrained by inflation that is impacting discretionary spending by consumers.
For the 3rd Quarter of FY 2023 ending September 30th 2023 the Company disappointed on revenue against consensus estimates. Net income was $364 million on total revenue of $1,837 million. Comparable figures for the 3rd quarter of FY 2022 ending September 30th were net income of $530 million on total revenue of $1,726 million. Diluted EPS attained $0.79 for the most recent quarter compared to $1.17 for the corresponding quarter of FY 2022.
For the 3rd quarter, system-wide sales increased by 10.9 percent compared to 14.7 percent for Q2 of FY 2022.
Comparing Q3 of FY 2023 with 2022, revenue increased by 6.0 percent but operating margin declined from 35.2 percent in Q3 2022 to 30.6 percent for the most recent quarter.
Segment results comprised:-
Tim Horton’s: Revenue, $1,060 million; EBITDA, $311 million; Comparable store sales increase, 9.1 percent with 5,701 stores
Burger King: Revenue $538 million; EBITDA $298 million; Comparable store sales increase 10.3 percent with 19,035 stores
Popeye’s LA Kitchen: Revenue, $188 million; EBITDA, $75 million; Comparable store sales increase, 16.1 percent with 4,373 stores
Firehouse Subs: Revenue, $51 million; EBITDA, $14 million; Comparable store sales increase, 6.9 percent with 1,266 stores
Josh Kobza Chief Executive Officer of RBI commented, "I am proud of the strength we're seeing across our brands due to the efforts of our franchisees and our teams which helped drive another quarter of double-digit system-wide sales growth and home market franchisee profitability growth. These results reflect our focus on enhancing operations, delivering great guest and team member experiences, and providing great value with the best quality products in each of our brands' respective categories. I am confident we are well positioned to enter 2024 with momentum."
On September 30th 2023, QSR posted assets of $23,077 million of which $16,627 million comprised goodwill, lease obligations and intangibles against long-term debt and leases of $15,034 million. The Company had an intraday market capitalization of $21,420 million on November 10th. QSR trades with a forward P/E of 14.5 and has ranged over a 52-week period from $59.55 to $78.30 with a 50-day moving average of $66.51. Twelve-month trailing operating margin was 32.7 percent and profit margin 13.2 percent. Return on assets over the trailing twelve months was 5.8 percent and the return on equity 30.5 percent.