Restaurant Brands International, the new owner of Tim Hortons, said Tuesday it has largely completed cost-reduction efforts at the iconic Canadian coffee chain and is turning its focus toward growth.
The new company, which also owns Burger King, cut about 350 white-collar jobs across Canada last month, six weeks after taking Tims over.
“We don’t have any plans for additional changes at this time. That’s all that we’ll comment on at this point,” Josh Kobza, head of finance at Restaurant Brands said on a conference call.
Daniel Schwartz, the new head of the combined Burger King-Tim Hortons company added: “Any time you have a merger of two companies in the same industry, there will be some synergies.”
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Stronger sales
The job cuts at Tims’ Oakville, Ontario headquarters and regional offices came roughly six weeks after 3G Capital, a Brazil-based investment company, merged Burger King with Tim Hortons to create the new Restaurant Brands International, the third-largest fast food company in the world.
3G, the controlling owner of Restaurant Brands International, comes with a reputation for dramatically slashing budgets and head count at companies it takes over. About 450 middle managers and higher-ups were fired from Burger King when it was acquired by 3G in 2010.
Though largely expected by industry experts, last month’s cuts drew scrutiny from labour leaders and some advocacy groups who say 3G’s ownership of the Canadian chain will be defined by “painful” cutbacks and other changes at the Canadian organization.
Those reservations haven’t been noticed much by Canadian consumers, it seems, with sales at restaurants open more than a year climbing 4.1 per cent in the final three months of 2014.
MORE: Canadians are opening their wallets wider at Tim Hortons
About growth
Tim Hortons doesn’t directly employ the tens of thousands of full- and part-time staff members at the 3,600 or so franchisee-owned locations across Canada. But it does directly employ 2,150 people spread across its headquarters, five distribution centres and seven regional offices.
MORE: Tim Hortons confirms layoffs
About 1,400 of those behind-the-scenes workers were employed at Tims headquarters or regional offices before last month’s cuts.
Tims opened about 180 new locations inside and outside of Canada last year, a pace Restaurant Brands hopes to accelerate, Kobza said.
“We have big hopes, we do want to accelerate the pace of growth at Tims all around the world over the coming years. But it’s a process that will take time, much as it did at Burger King,” Kobza said.
No menu overlap
Those hoping to find chicken fries popping up at Tims locations, or timbits at Burger King any time soon will be disappointed.
“Going forward I can’t emphasize enough we plan to manage these brands as independent, standalone brands. There’s not going to be any cross-selling of marketing or promotions,” Schwartz said.
“With Tim Hortons, what’s going to define success in this transaction … is growth. That’s what this deal has been about from the beginning,” Schwartz said.
Some analysts on Tuesday’s call suggested there’s room for 3G to make additional cuts at Tims. “It seems like there’s a variety of opportunities,” Jeffrey Bernstein, an analyst at Barclays, said.
jamie.sturgeon@globalnews.ca
Follow @jasturgeon
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