UPDATE 3-Burger King beats estimates, but renovations weigh
May 1st, 2008 | by admin |(Recasts lead; updates share price; adds details on impact ofrenovation project; previous NEW YORK)
LOS ANGELES, May 1 (Reuters) - Burger King Holdings Inc(BKC.N: Quote, Profile, Research), posted better-than-expected earnings and raised itsfull-year profit-per-share growth forecast on Thursday but saidrestaurant renovation-related costs would weigh on margins inthe current quarter.
The world’s second-largest hamburger chain said net incomerose to $41 million, or 30 cents per share, in the thirdquarter ended on March 31, from $34 million, or 25 cents pershare, a year earlier.
Analysts, on average, had been expecting it to earn 27cents per share, according to Reuters Estimates.
Revenue rose 10 percent to $594 million from $539 million.Sales at established stores open at least 12 months were up 5.8percent worldwide. Same-store sales were up 5.4 percent in theUnited States and Canada.
Burger King, best known for its Whopper hamburgers, hasbeen sprucing up old outlets and expanding value menu items andbusiness hours in a bid to catch up with industry rivals.
It said in the fiscal fourth quarter the renovation projectand the resulting loss of sales from temporarily closed unitswill negatively affect restaurant margins.
It expects the renovations will improve sales beginning inthe 2009 fiscal year beginning in July.
During the current quarter, the company plans to beginrolling out price increases that should help offset the risingcosts for meat and other items.
