Burger King steers away from special menus as profit beats

Reuters

Oct 28 (Reuters) - Burger King Worldwide Inc, knownfor its Whopper hamburgers, on Monday said it plans tointroduce fewer seasonal and limited-time menu items in a bid tohelp restaurant operators improve profits and speed up service.

Burger King, which reported a better-than expectedthird-quarter profit, has recently added a string ofattention-getting products ranging from bacon sundaes and asummer BBQ menu to low-fat "Satisfries" french fries, which havebecome a permanent menu item.

The company is now "focused on introducing fewer, moreimpactful products. A good example of this is the recent launchof Satisfries," Chief Executive Daniel Schwartz said on aconference call with analysts.

Shares in the fast-food chain jumped 5.6 percent to $20.87in early trading on the New York Stock Exchange after the profitreport, helped by lower costs from selling restaurants tofranchisees.

The third-largest U.S. hamburger chain, behind McDonald'sCorp and Wendy's Co, said expenses fell about 90percent, mainly because it sold more than 500 restaurants in thelast year to franchisees.

Sales at established restaurants were up 3.7 percent for theAsia Pacific region including China, where rivals McDonald's andKFC parent Yum Brands Inc have seen sales soften.Analysts had expected growth of 2.7 percent for that region,according to Consensus Metrix.

That result was offset by weakness in other parts of theworld.

Burger King said same-restaurant sales in United States andCanada fell 0.3 percent due to continued weakness in consumerspending and intense pricing competition among fast-food chains.Analysts had expected a rise of 0.8 percent.

This was despite the launch of "Satisfries" late last monthdrawing more diners to U.S. restaurants during the last week ofSeptember. Executives said the U.S. government shutdown inOctober did not result in a meaningful impact to the business.

Burger King also reported a softer-than-expected 2.4 percentrise in sales in its Europe, Middle East and Africa business.

Burger King's third-quarter global same-store sales growthof 0.9 percent matched that of McDonald's, which reported lastweek and warned that global sales would be relatively flat inOctober because of stiff competition and a weak economicrecovery.

Burger King's net income grew to $68.2 million, or 19 centsper share, from $6.6 million, or 2 cents per share, a yearearlier, when it owned and operated hundreds more restaurants.

On an adjusted basis, it earned 23 cents per share, topping the average analyst estimate of 21 cents, according to ThomsonReuters I/B/E/S.

With almost all of its restaurants now franchised, totalsales fell about 40 percent to $275.1 million.

Shares in Burger King are up about 24 percent this year.

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