Burger King 2013 Annual Report Download - page 5

Table of Contents
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Burger King Worldwide, Inc. (“BKW,” the “Company,” “we,” “us” or “our”) is a Delaware corporation formed on April 2, 2012 and the indirect parent
of Burger King Corporation (“BKC”), a Florida corporation that franchises and operates fast food hamburger restaurants, principally under the Burger
King® brand. We are the world’s second largest fast food hamburger restaurant, or FFHR, chain as measured by the total number of restaurants. As of
December 31, 2013, we owned or franchised a total of 13,667 restaurants in 97 countries and U.S. territories worldwide. Of these restaurants, 13,615 were
owned by our franchisees and 52 were Company restaurants. Our restaurants are limited service restaurants that feature flame-grilled hamburgers, chicken
and other specialty sandwiches, French fries, soft drinks and other affordably-priced food items. We believe our restaurants appeal to a broad spectrum of
consumers, with multiple day parts and product platforms appealing to different customer groups. During our nearly 60 years of operating history, we have
developed a scalable and cost-efficient quick service hamburger restaurant model that offers guests fast, delicious food at affordable prices.
We generate revenue from three sources: (1) retail sales at Company restaurants, (2) franchise revenues, consisting primarily of royalties based on a
percentage of sales reported by franchise restaurants and initial and renewal fees paid by franchisees, and (3) property income from properties that we lease or
sublease to franchisees.
We believe that we can deliver value to our shareholders and enhance the Burger King® brand by focusing our efforts on the stewardship of our brand.
During 2013, we completed our global refranchising initiative to sell our Company restaurants to franchisees, and we believe we are one of the few pure
franchise and real estate companies in our quick service restaurant, or QSR, peer group. We continue to own and operate 52 restaurants in Miami, Florida,
which we expect to use as a base for the testing of new products and systems. We believe that our fully franchised business model will yield many benefits,
such as accelerating international expansion, helping to drive restaurant remodels, maximizing capital efficiency and increasing our profitability and cash
flow. Furthermore, we believe that our fully franchised business model will permit us to focus on narrowing the average restaurant sales gap with our peers,
through menu innovation, franchisee operational support and brand development.
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We were founded in 1954 when James McLamore and David Edgerton opened the first Burger King restaurant in Miami, Florida and in 1957 we
introduced our signature Whopper® sandwich. In October 2010, we were acquired by 3G Capital Special Situations Fund II, L.P. (“3G”), which is controlled
by 3G Capital Partners, Ltd., an investment firm based in New York (“3G Capital”). On June 20, 2012, upon our merger with a subsidiary of Justice
Holdings Limited (“Justice”), we changed our name to Burger King Worldwide, Inc. and listed our shares on the New York Stock Exchange under the symbol
“BKW”.
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We operate in the FFHR category of the QSR segment of the restaurant industry. In the United States, the QSR segment is the largest segment of the
restaurant industry and has demonstrated growth over a long period of time. According to The NPD Group, Inc. (“NPD Group”), which prepares and
disseminates CREST® data, QSR consumer spending has grown at an annual rate of 3% over the past 10 years, totaling approximately $254 billion for the
12-month period ended November 2013.
According to NPD Group, the FFHR category is the largest category in the QSR segment, generating consumer spending of $72.6 billion in the United
States for the 12-month period ended November 2013, representing 29% of total QSR consumer spending. According to NPD Group, for the 12-month period
ended November 2013, Burger King accounted for approximately 12% of total FFHR consumer spending in the United States.
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We believe there are significant growth opportunities for our Company and the Burger King system by:
•  : We have identified the four priorities, or “pillars,” that we believe will enable us to drive
future sales and traffic in the U.S. and Canada.
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Source: Burger King Worldwide, Inc., 10-K, February 21, 2014 Powered by Morningstar® Document Research℠
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