OAKVILLE, Ontario – Continued strong same-store sales growth in the United States helped drive earnings at Tim Hortons Inc. in the second quarter. Net income in the quarter ended July 1 rose 13 percent to C$108,067,000 ($108,960,000), equal to C$0.70 per share on the common stock, up from C$95,549,000, or C$0.58 per share, in the second quarter of fiscal 2011.
Net revenues rose 12 percent to C$785,581,000 ($792,124,000) from C$702,760,000. Same-store sales grew 4.9 percent in the United States and 1.8 percent in Canada.
Operating income in the second quarter of fiscal 2012 rose 11 percent to C$158,839,000 ($160,176,000) from C$143,218,000.
The US segment had operating income of C$5,617,000 ($5,664,000) in the second quarter of fiscal 2012, up 40 percent from C$4,008,000 in the same period a year ago. Revenues in the US segment increased 20 percent to C$43,217,000 from C$36,072,000.
“We experienced strong earnings growth in the second quarter although same-store sales growth in Canada reflected a challenging macro-economic environment and minimal pricing in the system,” said Paul House, executive chairman, president and chief executive officer. “We are confident about the strategic initiatives designed to grow our business and support our long-term objectives.”
The strategic initiatives to which House referred include a new organizational structure and executive management appointments, as well as Tim Hortons entrance into the single-serve, on-demand North American coffee market.
The new structure includes the establishment of a business unit with accountability for all of the company’s operating businesses.
“The Canadian business has developed significant scale, and we have important strategic initiatives in place designed to support future growth in this market,” Tim Hortons said. “At the same time, our US business, which is a key future growth engine for the company, has become more established and has also grown in scale. We are also seeding growth internationally. The new structure facilitates strategy execution and decision-making across our operating businesses.”
Among the personnel changes, David Clanachan has been named chief operating officer of Tim Hortons Inc., with executive accountability for all of the company’s operating businesses, including Canada, the US and International. Roland Walton has been named president of Tim Hortons Canada, with accountability for the Canadian business, while Mike Meilleur will take over as executive vice-president of Tim Hortons US, with accountability for the US business.
The company’s board also announced it is continuing with an external search for the position of president and chief executive officer to lead the entire team under the new organizational structure.
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