Burger King's first-quarter earnings more than doubled even though revenue fell, as the fast-food chain trimmed several restaurant-related expenses.
The Miami-based company had warned earlier this month that sales at established restaurants were expected to fall during the quarter, and they wound up declining 1.4 percent. That includes a 3 percent drop in the United States and Canada.
Burger King Worldwide Inc. said Friday its net income rose to $35.8 million, or 10 cents per share, in the quarter that ended March 31. That's up from $14.3 million, or 4 cents per share, in the previous year's quarter when it was still private.
The company previously said adjusted earnings totaled 17 cents per share in the most recent quarter.
Revenue fell about 42 percent to $327.7 million. Analysts expected $305.8 million, according to FactSet.
Total restaurant expenses, which include things like food costs and payroll expenses, fell nearly 70 percent in the quarter to $108.1 million.
Burger King has been undergoing a revamp since it was purchased and taken private in 2010 by 3G Capital, a private investment firm run by Brazilian billionaires. The company has been selling more restaurants to franchisees, a move that lowers overhead costs. Instead of booking sales from those restaurants, that means Burger King would collect franchise fees instead.
In the first quarter, the company's restaurant revenues tumbled 69 percent to $121.1 million, but its franchise and property revenues rose 19 percent to $206.6 million.
Burger King's selling, general and administrative expenses also fell about 30 percent to $66.7 million in the quarter.
3G Capital also has slashed costs, signed international expansion deals and changed the U.S. menu to appeal to a wider audience. The moves came ahead of the company's return to public trading the New York Stock Exchange last June.
The company also is adjusting its strategy to focus on more menu deals, such as an offer for a $1.29 Jr. Whopper. McDonald's has been particularly aggressive in touting its Dollar Menu to boost traffic at a time when the restaurant industry is barely growing. Wendy's also revamped its value menu recently.
Burger King says its efforts to revamp the brand remain on track. But CEO Bernardo Hees, a 3G partner, is moving on later this year to head Heinz, another 3G investment. Chief Financial Officer Daniel Schwartz, also a 3G partner, will succeed Lees as CEO at Burger King.
Burger King shares finished at $18.06 on Thursday. They have traded between $12.91 to $20.20 since relisting.
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