Here’s What We Are Watching For In Restaurant Brands International’s Q3 2017 Results
Restaurant Brands International (RBI) (NYSE: QSR) will announce its Q3 2017 results on October 26th 2017 and we would be keenly watching the comparable sales numbers of its Tim Hortons segment. The company has been facing issues with its Tim Hortons franchisees for a while and comparable sales of this segment had declined by 0.8% in Q2 2107. While the company did not attribute this decline to the ongoing issues and believed that its growth will pick up in the second half of the year, franchisee troubles remain. These issues can slow down launch of new initiatives/menu items to attract customers, thus impacting the company’s revenue growth. In July the company was finally able to launch its mobile order and pay system for Tim Hortons, after several delays due to franchisee troubles. (Read Restaurant Brands: Here’s How Tim Hortons Can Benefit From Its Digital Initiatives).
Below is a summary of consensus analyst expectations for RBI for Q3 2017:
- Down 10% This Year, What’s Next For Restaurant Brands Stock?
- Down 8% YTD, Will Restaurant Brands Stock Recover Following Q2 Results?
- Restaurant Brands Stock Down 13% This Year, What’s Next?
- Down 6% YTD, Will Restaurant Brands Stock Gain Following Q1 Results?
- Will Q4 Results Help Extend The 20% Gain In Restaurant Brands’ Stock Since Early 2023?
- After A 9% Top-Line Growth In Q2 Will Restaurant Brands Stock Deliver Another Strong Quarter?
Source: Yahoo Finance
Challenging Industry Environment Remains
After a minor recovery in June, the restaurant industry remained challenging in Q3 2017 with comparable sales and comp traffic declining in all three months of the quarter, according to data published by TDn2K.
While quick service and fast casual restaurants are performing better than other formats, the two major hurricanes in the U.S. are likely to impact sales negatively. In the last week of August comparable sales in Texas declined by 15% due to the impact of Hurricane Harvey. The impact of Hurricane Irma is likely to be higher for Restaurant Brands International since Burger King operates nearly 700 restaurants in Florida, which is also its headquarters. Same store sales in Florida declined by 6.2% in September due to the impact of the storm. While consumer spending has increased after the hurricanes towards rebuilding efforts, this will not have a positive impact on restaurants.
We will be keenly watching the performance of the Tim Hortons segment and the impact of the hurricanes in RBI’s Q3 2017 results.
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