Tim Hortons Q1 Profit Rises, But Misses View

(RTTNews) - Canadian quick-service restaurant chain Tim Hortons Inc. (THI.TO, THI) Wednesday reported improved profit for the first quarter, supported by growth in revenues with same-store sales increases in the U.S. and Canada. However, results missed estimates.

Marc Caira, president and CEO, said, ''We made continued progress in the first quarter as we focused on aspects of our business where we could make an immediate impact, including simplifying our operations, enhancing our restaurants and introducing menu innovations."

Net income attributable to the company increased to C$90.91 million from C$86.17 million in the previous year. Earnings per share grew to C$0.66 from C$0.56.

Prior-year earnings were negatively impacted by a corporate reorganization charge of C$0.05 per share.

On average, 13 analysts had a consensus estimate of earnings per share of C$0.68 for the quarter. Analysts' estimates typically exclude one-time items.

Total revenues grew 4.8 percent to C$766.40 million from C$731.54 million. Analysts estimated revenues of C$778.18 million for the quarter.

Systemwide sales increased 5.1 percent on a constant currency basis due to new restaurant development in Canada and the U.S., and same-store sales growth.

Distribution sales growth was 4.9 percent, in line with the increase in systemwide sales. Rents and royalties revenue grew 6.4 percent, helped primarily by the increase in systemwide sales.

Franchise fee revenue climbed 28.1 percent due to higher levels of standard restaurant openings in the first quarter.

Canadian same-store sales grew 1.6 percent due to gains in average cheque, driven by favourable product mix and pricing.

In the U.S. also, same-store sales grew 1.9 percent, influenced by gains in average cheque resulting from favourable product mix and pricing.

Further, the company said its Board recommended a dividend of $0.32 per common share payable on June 5 to shareholders of record as of May 22.

THI slipped 0.2 percent on Tuesday to settle at $54.85.