I was first interested in Restaurant Brands International (QSR US) when a huge disconnect opened up between its listed subsidiaries and the parent company. The listed Brazilian operator of Burger King restaurants (Zampa) is down 90% over the last 5 years, while QSR is flat.
With Bill Ackman being a big owner of QSR US, and announcing a stake sale, I thought I would have another look. QSR gets most of its sales from Burger King, particularly in international sales, but even adding those numbers back, Tim Hortons, a Canadian coffee and bakery focused chain is the biggest profit contributor.
Reading between the lines, profitability is greater in North America than elsewhere for Burger King, something we have also seen at Domino’s Pizza. With Tim Hortons almost exclusively based in Canada and the USA, this leads it to be a much more profitable business.
