Tim Hortons Inc. announced results for the third quarter ended October 2. Third quarter systemwide sales increased 8.2% on a constant currency basis. Total revenues grew 8.4% to $726.9 million compared to $670.5 million in the prior year. The strength of systemwide sales helped drive rents and royalties revenues, which increased 6.8%, and distribution sales, which grew 11.9%. Higher distribution sales outpaced system growth due to higher pricing of underlying commodities, particularly coffee, moving through its supply chain.
The U.S. segment experienced robust same-store sales growth of 6.3%. Same-store sales performance benefited from increased average check, due to pricing in the system and favourable product mix, and also due to moderately higher transactions. Growth was supported by enhanced menu, marketing and promotional efforts designed to create higher brand awareness and increase guest traffic.
Restaurant development activity in the U.S. market, primarily focused on core growth markets, resulted in 23 new openings, including 12 full-serve restaurants and 11 self-serve locations.
Canadian segment same-store sales increased by 4.7% in the third quarter, outpacing growth in the first half of the year.
"Operating conditions in North America continued to be challenging and the strength of our sales performance is a great testament to our strong price-value brand position with our guests. We continued to innovate in the third quarter and execute our strategic growth plans to build our business," said Paul House, executive chairman, and president and CEO.
As of October 2, Tim Hortons had 3,871 systemwide restaurants, including 3,225 in Canada, 645 in the United States.