Burger King 2006 Annual Report Download - page 10

dayparts, as it makes economic sense for our restaurants. And we are
committed to growing again, expanding our presence throughout the
United States.
Expanding our international platform. With seasoned leaders now in
place, we’re extremely well positioned for growth outside the United States.
Internationally, we’re about one-fifth the size of our largest competitor,
which demonstrates significant opportunities for us. During fiscal 2007,
we anticipate opening at least 300 new restaurants internationally.
Continuing to improve relationships with franchisees. We succeed
when our franchisees succeed. I am committed to continuing to improve
our relationships with our franchisees so that our company and our
franchisees enjoy a cohesive organization focused on supporting the
Burger King brand globally.
Becoming a world-class global company. For fiscal 2007, we have
developed a global marketing calendar to create more consistent adver-
tising and brand positioning strategies across all our markets. We’ve also
established a global product development team to reduce complexity
and increase consistency in our worldwide menu. We expect to use our
global purchasing power to negotiate lower product costs and savings
for our restaurants outside of the United States and Canada.
Being an employer of choice. One of the ways that we’re accomplish-
ing this goal is by creating a culture that’s Bold, Accountable, Empowered
and Fun. “Bold” represents our determination to approach every situation
with dynamic, innovative thinking. “Accountable” means that we embrace
the responsibility we have as a public company to deliver value for our
shareholders and for our franchisees and to provide great service and
products to all our restaurant guests. “Empowered” says that we are
customer focused, whether that customer is a franchisee or a restaurant
guest. And “fun” says that we work as a team and strive to make every
Burger King worldwide – all 11,100-plus restaurants, our field teams and
our Restaurant Support Centers – a place where people love coming to
work every day.
If we are Bold, Accountable, Empowered and Fun, our restaurant guests
will know it from their first moment of contact with us. By delivering a
great guest experience, we’ll continue to accelerate the growth of our
business. And through our unwavering focus on the growth of our busi-
ness, we’ll succeed in turning our great brand into a great investment.
John W. Chidsey
Chief Executive Officer
October 27, 2006
On behalf of the entire Burger King® team,
I’d like to welcome you as a shareholder
and to our first-ever Annual Report.
Everything we’re doing at Burger King is
designed to grow the company with equally
high rates of speed and expertise. We are
well positioned for rapid global expansion.
We are actively driving franchisees’ growth
and motivating them to embrace their role
in our restaurant-count and single-store profitability goals. Add to this
the amplifying effect of top-flight marketing and operations teams that
are driving guests into restaurants and ensuring an excellent experience
when they get there. All considered, we believe we have the perfect
recipe for our investors.
BU Y T H E N U MBE R S. We are on a fiscal winning streak. High-
lights from fiscal year 2006 include record revenues of $2.05 billion,
up 6 percent. Average restaurant sales (ARS) reached $1.13 million in
North America and $1.11 million internationally – both all-time highs.
We’ve posted 10 consecutive quarters of comp sales growth worldwide.
Since the company’s IPO on May 18, the company has retired a total of
$435 million in debt, reducing our debt level by more than 30 percent.
By reducing debt, we’ve reduced interest expense and increased our
cash flow, which gives us more flexibility for future investment.
Our intention is not to ride this momentum, but to accelerate it. The entire
leadership team and I are intensely focused on delivering the following
key financial metrics in fiscal year 2007 and beyond:
• average annual revenue growth of 6–7 percent;
• average annual EBITDA growth of 10–12 percent;
• net income growth of 20 percent; and to
• drive ARS to $1.3 million in the United States over
the next four to five years.
GO IN G F OR WA R D. We’ll meet or exceed these targets by focusing
on five strategic areas:
Driving sales growth and profitability of our U.S. business. Our
purchasing scale, along with our initiatives to promote restaurant effi-
ciency, will further improve restaurant profitability. We will continue to
emphasize competitive hours of operations in the breakfast and late night
TO OUR SHAREHOLDERS
08
John W. Chidsey
Chief Executive Officer
B K C