Restaurant Brands sees profits rise 18%

As Tim Hortons and Burger King’s parent company saw its profit rise 18 per cent in its latest quarter, its chief executive noticed a broader trend taking hold across the industry: slowing sales.

Restaurant Brands International Inc.’s Joshua Kobza says consumers have become “a bit more sensitive to price,” pressuring the fast-food sector, even though inflation is easing.

The shift in behaviour has left fast-food chains looking to drive more traffic to their restaurants and convince customers to drop a bit more money on every order, but Kobza tempered expectations around how far the Toronto-based company will go to counter some of the price sensitivity.

“We know value is also top of mind, and while there are a few tactical things we can do on the margin, you should not expect us to reinvent the wheel on value,” he told analysts on a Tuesday call.

Kobza’s remarks were made hours after RBI, which also owns Popeyes Louisiana Kitchen and Firehouse Subs, revealed it earned a net income of $328 million (U.S.) or 72 cents per diluted share in its first quarter, up from $277 million or 61 cents per diluted share a year earlier.

The company, which keeps its books in U.S. dollars, said revenue totalled $1.74 billion for the quarter ended March 31, up from $1.59 billion in the same quarter last year.

On an adjusted basis, it earned 73 cents per diluted share in its latest quarter, down from 75 cents per diluted share a year earlier.