Restaurant Brands International Inc. Announces Full-Year and Q4 2024 Financial Results
Restaurant Brands International Inc. (RBI) today reported financial results for the full year and fourth quarter ended December 31, 2024. Josh Kobza, Chief Executive Officer of RBI, commented on the company’s performance:
“I am proud of our performance this year, reflecting the strong foundations we’re building across our businesses and the dedication of our teams and franchisees who are executing the fundamentals of quality, service, and convenience with excellence. As we look ahead, we remain focused on thoughtful marketing, operational improvements, and a modernized image to enhance the guest experience, drive franchisee profitability, and deliver long-term growth for our brands and shareholders.”
Items Affecting Comparability and Restaurant Holdings Segment Update
RBI successfully completed two major acquisitions in 2024:
- Carrols Restaurant Group Inc. (Carrols) on May 16, 2024
- Popeyes China (PLK China) on June 28, 2024
Following these acquisitions, RBI established a new operating and reportable segment, Restaurant Holdings (RH), which now includes results from the Carrols Burger King restaurants and the PLK China restaurants. RBI now reports results under six operating and reportable segments:
- Tim Hortons (TH)
- Burger King (BK)
- Popeyes Louisiana Kitchen (PLK)
- Firehouse Subs (FHS)
- International (INTL)
- Restaurant Holdings (RH)
RBI plans to maintain a franchisor model for five of its six segments (TH, BK, PLK, FHS, and INTL), while RH includes company-operated restaurant sales and associated expenses. RBI intends to refranchise most Carrols Burger King restaurants and secure a new partner for PLK China in the future.
Additionally, Burger King acquired non-Carrols franchise restaurants throughout 2023 and early 2024. By the end of 2024, Burger King owned and operated 160 company restaurants, compared to 138 at the end of 2023. Of these, 88 were acquired in Q4 2023.
RBI has also updated its financial reporting methodology for Adjusted Operating Income, now defining Segment Franchise and Property Expenses (Segment F&P Expenses) separately from amortization-related costs. This change does not impact Adjusted Operating Income or consolidated results.
Supplemental Disclosures
For further details, RBI has published additional disclosures on its Investor Relations website, including:
- Home Market and International KPIs by brand and company restaurant count by segment
- Segment results with disaggregated franchise and property revenues
- Intersegment revenue and expense eliminations
- Burger King U.S. “Reclaim the Flame” expenditures
- RH Burger King Carrols restaurant-level EBITDA margins
Financial Performance Overview
Revenue Growth
Total revenue for the full year and fourth quarter of 2024 increased, primarily due to:
- Higher system-wide sales across all brands
- Higher supply chain sales to franchisees
- Increased equipment sales in the full year
- Absence of a prior-year negative adjustment related to increased promotional activity in the TH consumer-packaged goods business
Adjusted Operating Income
The increase in Adjusted Operating Income for the full year and Q4 was driven by:
- Higher total revenues
- Decrease in Segment G&A due to lower compensation-related expenses
- Higher supply chain costs due to increased volumes
- Higher Segment F&P expenses
Total revenue and Adjusted Operating Income were affected by unfavorable foreign exchange (FX) movements. Excluding these movements:
- Total revenue for 2024 increased by $121 million
- Adjusted Operating Income for 2024 increased by $98 million
- Total revenue for Q4 increased by $32 million
- Adjusted Operating Income for Q4 increased by $39 million
Burger King U.S. “Reclaim the Flame” Initiative
Burger King continues to execute its multi-year “Reclaim the Flame” strategy to accelerate sales growth and improve franchisee profitability. This initiative includes investing up to $700 million by the end of 2028, with two key investment categories:
- “Fuel the Flame”: Completed in Q4 2024, focusing on advertising and digital investments
- “Royal Reset”: Includes remodels, relocations, restaurant technology, kitchen equipment, and building enhancements
As of December 31, 2024, RBI has funded $133 million out of the planned $550 million Royal Reset investment.
International Performance
For the full year 2024:
- Burger King International (BK INTL) system-wide sales grew 8.0%
- Popeyes International (PLK INTL) system-wide sales grew 47.5%
For Q4 2024:
- BK INTL system-wide sales grew 9.6%
- PLK INTL system-wide sales grew 40.3%
Despite these gains, Adjusted Operating Income was partially offset by increased bad debt expenses related to the Burger King China business and higher compensation-related expenses.
Excluding FX movements:
- Total revenue for 2024 increased by $84 million
- Adjusted Operating Income for 2024 increased by $42 million
- Total revenue for Q4 increased by $21 million
- Adjusted Operating Income for Q4 increased by $8 million
Dividend Declaration
RBI’s Board of Directors has declared a $0.62 per common share dividend for Q1 2025. The dividend will be payable on April 4, 2025, to shareholders of record as of March 21, 2025. RBI also announced a targeted total dividend of $2.48 per share for 2025.
2025 Financial Guidance
For 2025, RBI expects:
- Segment G&A (excluding RH): Between $650 million and $670 million
- RH Segment G&A: Approximately $100 million
- Adjusted Interest Expense (net): Between $500 million and $520 million
- Capital Expenditures (including RH): Between $400 million and $450 million
Long-Term Growth Targets (2024-2028)
RBI has outlined long-term performance expectations for 2024 to 2028:
- 3%+ Comparable Sales Growth
- 5%+ Net Restaurant Growth
- 8%+ System-Wide Sales Growth
- Adjusted Operating Income Growth at least as fast as system-wide sales growth
RBI noted that net restaurant growth expectations could be reassessed based on the resolution of ongoing issues with Burger King China’s master franchisee.
