Business

Burger King profits up as costs fall

  • 28 October 2013
  • From the section Business
Burger King, Glendale, California
Burger King sales outside North America jumped

Fast food vendor Burger King has reported higher profits as sales increased outside the US.

The US restaurant chain said its better-than-expected profits for the July-to-September period of this year were due to cost reductions and more franchising.

Burger King's net profit rose to $68.2m (£42.2m), as against $6.6m in the same period a year earlier.

However, sales at its North American branches fell 0.3%.

The company has recently introduced Satisfries, a lower-fat variety of chips, in the US and Canada, in an effort to offer a healthier alternative after criticisms of the high fat content of its food,

Costs cut

The firm, which is the third-largest burger chain in the US, behind rivals McDonalds and Wendy's, said it has succeeded in reducing costs by 90%, through greater use of franchising instead of owning its restaurants.

In the past year, it refranchised more than 500 restaurants.

Burger King saw sales rise 2.4% in Europe, Africa and the Middle East for the three months to 30 September, with a successful online coupon-driven marketing push in Germany and Spain.

In the Asia Pacific region, Burger King sales rose 3.7%.

Burger King was taken over by Brazilian investment firm 3G in 2010.

Last week, Burger King's biggest rival, McDonald's, warned of flat profits and a "challenging" market ahead.

Burger King shares have risen 16% over the past 12 months, and were up 2.7% in pre-market trading following the results.

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