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Tim Hortons' comeback takes maintain as espresso chain forecasts one other yr of Canadian same-store gross sales progress

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Restaurant Brand International eating places’ Tim Hortons and Popeyes.

Randy Risling | Toronto Star | Getty Images

Tim Hortons is anticipating Canadian same-store gross sales progress within the mid-to-high single digits in 2022 because the espresso chain’s turnaround takes maintain in its house market.

The Restaurant Brands International chain additionally mentioned Tuesday throughout an investor presentation that it set a long-term aim for same-store gross sales progress of two% to three% yearly. Tims reported Canadian same-store gross sales progress of 10.8% in 2021 and same-store gross sales declines of 16.5% in 2020.

Because of its massive Canadian footprint, Tim Hortons sometimes accounts for greater than half of Restaurant Brands’ income, however latest sluggish gross sales have weighed on the restaurant firm’s total outcomes.

Over the previous couple of years, Tims has shuffled its govt group, up to date its espresso and breakfast choices, and revamped its loyalty program within the hopes of as soon as once more driving gross sales progress in its house market. Even earlier than the Covid pandemic, gross sales and site visitors had been stagnating as Canadians selected Starbucks or McDonald’s for his or her espresso as a substitute.

“In Canada, it’s gotten more competitive over the last 10, 15 years than it was 30 years ago,” Restaurant Brands CEO Jose Cil mentioned.

The pandemic served as one other roadblock to its comeback as outbreaks in Canada led to extra restrictions, though Tim Hortons President Axel Schwan mentioned mobility is now returning.

“Canada had some of the longest lockdowns, really, in the world,” Schwan mentioned. “Coming out of [the first quarter], we see a lot of momentum, traffic picking up, people getting out again.”

Earlier on Tuesday, the espresso chain reported same-store gross sales progress of 8.4%, falling wanting StreetAccount estimates of 9.6%. Canadian same-store gross sales rose by double digits in the course of the first quarter.

Executives laid out their technique in the course of the presentation to go “back to basics” to attract in prospects. The strategy focuses on its meals and beverage choices, digital engagement and the in-restaurant expertise.

“Over the next few years, we will remain focused on expanding into high-growth dayparts and products, enhancing our leading digital ecosystem and maintaining our leading operations and optimizing our restaurant performance,” Schwan informed buyers.

Technology performs a key function in these plans, like rolling out digital menus nationwide for drive-thru lanes. In addition to with the ability to counsel menu objects based mostly on climate and different components, these menu boards will show digital variations of Tims’ bakery circumstances. Executives famous that drive-thru prospects sometimes purchase fewer baked items than prospects who order inside, the place pastries and different baked items are showcased.

Shares of Restaurant Brands fell 2% in afternoon buying and selling, regardless of the corporate topping Wall Street’s estimates for its first-quarter earnings and income.

Correction: Jose Cil is CEO of Restaurant Brands. An earlier model misstated his title.

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