Restaurant Brands International Inc. Reports First Quarter 2025 Results

PR Newswire

MIAMI, Fla., May 8, 2025

Consolidated system-wide sales grow 2.8% year-over-year, including 8.6% in International

Global comparable sales of 0.1%, or over 1% adjusting for Leap Day(a)

RBI remains on track for 8%+ organic Adjusted Operating Income growth in 2025

MIAMI, Fla., May 8, 2025 /PRNewswire/ - Restaurant Brands International Inc. ("RBI") (TSX: QSR) $(QSR)$ (TSX: QSP) today reported financial results for the first quarter ended March 31, 2025. Josh Kobza, Chief Executive Officer of RBI commented, "We are making solid progress executing the fundamentals of our business, despite a slower start to the year. We have clear growth plans across each of our brands and strong alignment with our franchisees. We're seeing encouraging momentum in Q2 and combined with responsible cost management, are on track to deliver stronger results through the balance of the year and achieve at least 8 percent organic adjusted operating income growth in 2025."

 
Consolidated Operational and Financial Highlights 
(in US$ millions, except per share and ratio data, unaudited) 
                                          Three Months Ended March 31, 
                                          -------------------------------- 
Operational Highlights                           2025             2024 
 System-Wide Sales Growth                              2.8 %         8.1 % 
 System-Wide Sales                         $          10,496  $     10,512 
 Comparable Sales                                      0.1 %         4.6 % 
 Net Restaurant Growth                                 3.3 %         3.9 % 
 System Restaurant Count at Period End                32,149        31,113 
 
Financial Highlights 
 Total Revenues                            $           2,109  $      1,739 
 Income from Operations                    $             435  $        544 
  Income from Operations Growth                     (20.0) %        21.7 % 
 Net Income from Continuing Operations     $             223  $        328 
 Diluted Earnings per Share from 
  Continuing Operations                    $            0.49  $       0.72 
 Adjusted Operating Income (AOI) (b)       $             539  $        540 
  Organic AOI Growth (b)                               2.6 %         7.7 % 
 Adjusted EBITDA (b)                       $             642  $        627 
 Adjusted Diluted Earnings per Share (b)   $            0.75  $       0.73 
 Net Leverage (b)                                   4.7x            4.8x 
 
 
(a)  Excludes an estimated 110 basis point consolidated impact on comparable 
     sales from Leap Day in the prior year period. 
(b)  Adjusted Operating Income, Organic AOI Growth, Adjusted EBITDA, Adjusted 
     Diluted Earnings per Share, and Net Leverage are non-GAAP financial 
     measures. Please refer to "Non-GAAP Financial Measures" for further 
     detail. 
 

Items Affecting Comparability and Restaurant Holdings Segment Reminder

Restaurant Holdings Segment

We completed the acquisitions of Carrols Restaurant Group Inc. ("Carrols") ("the Carrols Acquisition") and Popeyes China ("PLK China") ("the PLK China Acquisition") on May 16, 2024 and June 28, 2024, respectively. Our consolidated results include Carrols and PLK China revenues, expenses and segment income from their acquisition dates.

Following the Carrols and PLK China Acquisitions, RBI established a new operating and reportable segment, Restaurant Holdings $(RH)$, which includes results from the Carrols Burger King restaurants, the PLK China restaurants and, beginning in 2025, Firehouse Subs Brazil ("FHS Brazil"). RBI reports results under six operating and reportable segments consisting of four franchisor segments for the Tim Hortons, Burger King, Popeyes and Firehouse Subs brands in the U.S. and Canada (TH, BK, PLK, and FHS), a fifth franchisor segment for all of our brands in the rest of the world $(INTL.UK)$, and RH.

RBI plans to maintain the franchisor dynamics in its TH, BK, PLK, FHS and INTL segments ("five franchisor segments") to report results consistent with how the business will be managed long-term given RBI's plans to refranchise the vast majority of the Carrols Burger King restaurants and to find a new partner for PLK China and new investors for FHS Brazil in the future. RH results include Company Restaurant Sales and expenses, including expenses associated with royalties, rent, and advertising. These expenses are recognized, as applicable, as revenues in the respective franchisor segments (BK and INTL) and eliminated upon consolidation. For more information please review the "Restaurant Holdings Intersegment Dynamics" presentation dated August 8, 2024 posted on our IR website under "Events & Presentations".

Update to Presentation of Adjusted Operating Income

Beginning with our year-end 2024 results, RBI updated its presentation of Adjusted Operating Income by defining Segment Franchise and Property Expenses ("Segment F&P Expenses") which exclude Franchise Agreement Amortization and Reacquired Franchise Rights Amortization. These items were previously included in each segment's franchise and property expenses and added back as an adjustment to Adjusted Operating Income. This presentation change does not impact Adjusted Operating Income or Consolidated results.

Acquisition of Burger King China and Treatment as Held for Sale

On February 14, 2025, we acquired substantially all of the remaining equity interests in Burger King China ("BK China") from our former joint venture partners. BK China has been classified as held for sale and reported as discontinued operations, as we are actively working to identify a new controlling shareholder. This aligns with our long-term strategy of partnering with experienced local operators while maintaining a primarily franchised business.

Held for sale is defined as those assets and liabilities, or groups of assets and liabilities, for which management has committed to a plan for sale and that are available for immediate disposition in their current condition. These are expected to be sold within one year and are accounted for and reported separately from our continuing operations. Results for BK China are therefore reported as discontinued operations in our financial statements. That said, BK China KPIs continue to be included in our International segment KPIs.

Supplemental Disclosures

Please review the Trending Schedules posted on the RBI Investor Relations webpage under "Financial Information" for additional disclosures, including:

   -- Home Market and International KPIs by Brand and Company Restaurant Count 
      by Segment; 
 
   -- Segment Results with Disaggregated Franchise and Property Revenues 
      (Royalties, Property Revenue and Franchise Fees and Other Revenue); 
 
   -- Intersegment Revenue and Expense Eliminations; 
 
   -- BK China KPIs and Selected Financial Data; 
 
   -- Burger King US "Reclaim the Flame" Expenditures by Quarter; and 
 
   -- RH Burger King Carrols Restaurant-Level EBITDA Margins. 
 
TH Segment Results                          Three Months Ended March 31, 
                                          -------------------------------- 
(in US$ millions, unaudited)                    2025               2024 
                                          ----------------      ---------- 
 
System-wide Sales Growth                             0.0 %           7.8 % 
System-wide Sales                        $           1,631   $       1,725 
Comparable Sales                                   (0.1) %           6.9 % 
 Comparable Sales - Canada                           0.1 %           7.5 % 
Net Restaurant Growth                                0.4 %           0.0 % 
System Restaurant Count at Period End                4,523           4,505 
 
Supply Chain Sales                       $             611   $         627 
Company Restaurant Sales                 $              10   $          10 
Franchise and Property Revenues          $             219   $         231 
Advertising Revenues and Other Services  $              64   $          70 
                                          ----------------      ---------- 
Total Revenues                           $             903   $         939 
 
Supply Chain Cost of Sales               $             496   $         517 
Company Restaurant Expenses              $               9   $           9 
Segment F&P Expenses                     $              78   $          80 
Advertising Expenses and Other Services  $              66   $          70 
Segment G&A                              $              37   $          42 
Adjustments: 
 Cash Distributions Received from 
  Equity Method Investments              $               3   $           3 
                                          ----------------      ---------- 
Adjusted Operating Income                $             220   $         224 
 

The decrease in Total Revenues was primarily due to a $50 million unfavorable FX Impact. Excluding the FX Impact, Total Revenues increased $15 million, primarily driven by an increase in supply chain sales largely due to increases in commodity prices and an increase in CPG net sales.

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