April 30, 2008 / 10:20 PM / 10 years ago

Tim Hortons profit up, makes management changes

VANCOUVER, British Columbia (Reuters) - Coffee and doughnut chain Tim Hortons THI.TO THI.N said on Thursday that first-quarter profit was 4.3 percent higher, as sales grew despite tough winter weather conditions.

A pedestrian walks past a Tim Hortons restaurant in Toronto October 26, 2007. REUTERS/Mark Blinch

The company also said it was making changes to its management structure, which will result in a C$3.8 million charge in the second quarter, but produce C$1.5 million in future annual savings.

Net earnings rose to C$61.8 million, or 33 Canadian cents per diluted share, in the quarter ended March 30, from C$59.2 million, or 31 Canadian cents a share, in the same period a year earlier, the company reported.

Analysts had expected earnings before exceptions of 36 Canadian cents a share, according to Reuters Estimates.

A household name in Canada, where it is affectionately called Tims, the company said revenue rose 8.4 percent to C$460.3 million, which it credited to promotions and menu changes that brought in customers despite tough weather in some of its key markets.

“Our first quarter performance was below our full-year targets but we expected a challenging quarter and have continued confidence in our ability to meet our sales growth targets for the full year,” Chief Executive Don Schroeder said in a statement.

Same-stores sales were up 3.5 percent in Canada and 1 percent in the United States, where the quick-service restaurant plans a bigger expansion this year.

The company said 25 restaurants were opened during the quarter, compared with 21 a year ago.

Reporting Allan Dowd, editing by Rob Wilson

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