In the last few parts of this series, we covered how Tim Hortons (THI) introduced new items on its menu and opened new locations. We also discussed THI’s other initiatives to grow revenues.
In this part of the series, we’ll see how effective these initiatives have been. THI’s overall revenues for the third quarter grew 5.2% to $835.9 million. Its overall revenues were $794.4 million during the same quarter last year.
Canada is THI’s main segment. It accounts for 82% of THI’s revenues. It reported $688 million in revenues in 3Q14—this is 5.6% growth year-over-year (or YoY). The US segment contributed 7% of THI’s revenues. It reported $55 million in revenues in 3Q14. This was a 22% increase YoY from $45 million last year.
THI also reports revenues from variable interest entities (or VIEs). VIEs reported a decline in revenue by 6%—from $95 million to $89 million. VIEs form THI’s interest in its equity investments. The company has the power to take benefits and absorb losses. However, THI noted that these VIEs don’t impact the earnings per share (or EPS) on consolidation.
Over the same period, Dunkin’ Donuts (DNKN) reported 3.3% revenue growth to $192 million. Starbucks (SBUX) reported 10% revenue growth to $4.1 billion. McDonald’s (MCD) reported 4.5% revenue loss to $6.9 billion.
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In the next part of this series, we’ll look at THI’s cost of operations. We’ll compare its 3Q14 results with the same period last year. We’ll also see how some of its peers managed costs during the same period.