Good morning and welcome to the Restaurant Brands International Third Quarter 2019 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Chris Brigleb, RBI’s Head of Investor Relations. Please go ahead.

Thank you, operator. Good morning, everyone and welcome to Restaurant Brands International’s earnings call for the third quarter ended September 30, 2019. As a reminder, a live broadcast of this call maybe accessed through the Investor Relations webpage at investor.rbi.com and a recording will be available for replay.Joining me on the call today are Restaurant Brands International’s CEO, José Cil, and CFO, Matt Dunnigan. José and Matt will also be joined by our COO, Josh Kobza, for the Q&A portion of today’s call.Today’s earnings call contains forward-looking statements, which are subject to various risks set forth in the press release issued this morning and in our SEC filings. In addition, this earnings call includes non-GAAP financial measures. Reconciliations of non-GAAP financial measures are included in the press release available on our website.Let’s quickly review the agenda for today’s call. José will start with some opening remarks and highlights for the third quarter and then discuss our performance at Tim Hortons, Burger King and Popeyes. Matt will then review financial results before opening the call up for Q&A.I would now like to turn the call over to José. José Cil: Thanks, Chris and good morning everyone. I would like to start with a quick summary of the third quarter results and then spend some time sharing my views on the key drivers of our performance and the confidence we have in our plans for each of our brands to continue driving significant system-wide sales growth around the world. Overall, we had a strong quarter with nearly 9% consolidated system-wide sales growth and 5% year-over-year unit growth to over 26,300 restaurants worldwide. This nearly 9% system-wide sales growth represents the highest rate we have achieved since the beginning of 2018 and was led by Burger King at approximately 11% and Popeyes at…

Thanks, José and good morning, everyone. In the third quarter, system-wide sales growth across each of our brands led to consolidated adjusted EBITDA of $602 million, up 6.7% organically year-over-year, representing our strongest quarter of growth in the past seven quarters going back to 2017. Our growth this quarter also reflected ad fund revenues exceeding expenses by $6 million less than they did in the third quarter of last year, resulting in an impact of approximately negative 1% to our consolidated organic adjusted EBITDA growth.As we have mentioned in the past, while in some quarters there may be a mismatch in the timing of revenues and expenses, in the long run, these ad funds are managed such that total cumulative revenues equal expenses. At the segment level, Tim Hortons’ third quarter adjusted EBITDA was $301 million which represents a 1.7% organic increase year-over-year. This increase was driven primarily by supply chain sales, which includes a combination of changes in product mix, growth in our retail business and growth in equipment related to our fresh brewer rollout as well as the timing of certain cost recoveries and G&A. Also, a majority of the negative impact to consolidated adjusted EBITDA, related to the timing of ad fund revenues and expenses was attributable to Tim Hortons.At Burger King, third quarter adjusted EBITDA was $254 million representing a year-over-year organic increase of approximately 12%, our strongest quarter since the fourth quarter of 2017. This increase was driven primarily by strong system-wide sales growth of approximately 11% with continued momentum in global net restaurant growth of nearly 6% and global comparable sales growth of nearly 5%. Finally at Popeyes, this quarter’s adjusted EBITDA was $47 million which was up nearly 12.5% organically year-over-year. This increase was driven by very strong system-wide sales growth of over…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] And today’s first question comes from Jeffrey Bernstein of Barclays. Please go ahead.

Great. Thank you very much. Just a question on Tim Hortons, José, I know you acknowledged another challenging quarter. Couple of things. I am just wondering maybe what are you looking for or what milestone will you maybe question the confidence of the Winning Together plan? And then I know you mentioned being excited about the long-term growth prospects in Canada in the release, I am just wondering at what point we talk more about North America and rest of the world or whether you think this is primarily to be focused just specifically on Canada? Any color on that as well as any feedback from franchisees in terms of concerns of the convention would be great? Thank you. José Cil: Hey, Jeff. Thanks a lot for the question. We were – as I mentioned in my opening remarks, we remain extremely confident in the Winning Together plan. I think we are creating a strong foundation to drive sales growth over the long run through the improvements in image, technology, product quality, the drive-through and overall customer experience. These things are not things that happen from one day to the next or quarter over quarter. It takes time and the focus areas as I mentioned in my remarks are leadership in coffee and we’re doing quite a few things that are structural. We are making some innovative changes to how we prepare and serve coffee which are changes that are – are changes in our technology for brewing that has been in place for about 40 years, so important, really, really structural important initiatives. Food quality and innovation is a big part of our plan and I touched on innovation cafe being a hub for really creative, innovative thinking, which is going to help us over the long haul in…

Our next question today comes from Dennis Geiger of UBS. Please go ahead.

Thanks. Good morning. José thanks for all the color on the factors impacting Hortons in the quarter as well as the key growth pillars looking forward just wondering if you could talk, though a bit more about the impact perhaps of loyalty on sales in the quarter, recognizing that some of the benefits are likely to build over time? And then at the risk of being a little repetitive, just thinking about the drivers of the four key areas of focus that you outlined, it seems like a mix of kind of compelling near and longer term sales contributors, but just your thoughts on those go forward initiatives relative to kind of what has been launched over the last 12 months and just kind of the differences there and why that can strengthen the brand going forward? Thank you. José Cil: Great. Thanks Dennis. On loyalty, as I’ve mentioned many times we’re super excited about the Tims Rewards program. It’s – with our existing dominant market share in Canada, we saw over the last two years as we started to work on this program, we saw an opportunity to reward our guests for their years of loyalty through personalized offers that are meaningful to them, and that help us drive incremental traffic and ticket growth from our restaurant owners. Now, we’re playing both offense and defense here. Most of our competitors have – they have loyalty programs that have already been deployed and with our existing traffic and loyalty, we see an opportunity to drive as I mentioned incremental traffic and ticket. So step one of the program was to attract as many existing guests as possible to join the loyalty program. And step two in our plan was always to make meaningful personalized offers to all of those guests…

Our next question today comes from John Glass of Morgan Stanley. Please go ahead.

Thanks. And I’m going to ask another one on Tims, or two parts. One is just if you look at the last 3 years, comps have been slack in Canada. So this isn’t a recent phenomenon and sometimes, it’s just a change in the market that’s occurring and we sort of lose it in the quarter-to-quarter cadence. When you look at the business over the last few years, do you think it’s more that the category is just slower in Canada or do you view this as a more of a competitive issue? How do you frame why sales are not as strong, given you’re doing a lot of things you have been doing a lot of things over the last year or two in that brand. And secondly specifically this quarter I think you had launched or you have the plant-based products in breakfast and as well as the lunch. And I think you pulled them out or at least decided to pause, why didn’t they drive sales? I think in Canada you had seen other brands have seen successes in that in those products, why didn’t they work? If your assessment is they didn’t work for Tims why didn’t they? José Cil: Thanks, John. I appreciate the question. I think in terms of overall market in Canada continues to be a great QSR market, we feel very good about the long-term prospects. Obviously over the last four or five years and even longer, new competitors have come into the market there is always competition in the quick service restaurant business, especially when you include the informal market. So we feel very good about our market position. It’s a dominant position. We have more than seven out of ten cups of coffee or had at a Tim Hortons. So…

Our next question comes from Nicole Miller of Piper Jaffray. Please go ahead.

Thank you and good morning. I wanted to switch gears to Popeyes for a minute. So, when you gave the BK Impossible Whopper information, you did talk about how that helped potentially driving a new customer, but also not just a customer for that product necessarily? So the question is around the Popeye’s Chicken Sandwich launch. How did that strengthen its daypart or other dayparts, other products around food or beverage platforms? And then just a second comment broadly if you could, how did it perform across markets and clearly it’s very successful? So what part of it was different in terms of results versus the test? Thank you. José Cil: Thanks for the call. I think as I mentioned in the prepared remarks or the opening remarks what was exciting about the Popeyes sandwich launch in the U.S. and the performance in the quarter is that it lifted all other parts of the business. So we saw a lift in our bone-in chicken business, we saw lift in tenders, we saw lift and ancillaries, we saw lift in beverages, quite a lift as well in desserts. So there was a lot of strong performance for the business and from a mix standpoint, across the entire business. We brought in, and we’re still working through the data, but we saw a lift in frequency from existing guests and customers and fans or super fans that know the Popeyes brand quite well and we also saw new folks come in to try it, a lot of it driven by the buzz online around the so-called chicken wars, people wanted to test and validate that in fact we had come up with the greatest Chicken Sandwich of all time. So that’s for people to decide and our guests to decide, but there was a lot of folks coming to the restaurants, specifically for the Chicken Sandwich, but a lot of those transactions included other products in the menu, which is one of the things that’s most important about Popeyes is that the overwhelming majority is still about 65% of the U.S. hasn’t tried Popeyes and we know when guests try the product, but when consumers try the product, it’s preferred over any other chicken QSR or most of the chicken QSR players in the market. So our goal through a bunch of different initiatives including delivery, including rapid expansion of our footprint as well as the expansion of our menu offering to make sure we can be enticing to a broad base of consumers. Our goal is to have people try the product. When they tried the product they come back for more. And that’s what we’re seeing and that’s what we’re excited about. Thanks a lot for the question.

Our next question today comes from Sara Senatore of Bernstein. Please go ahead.

Hi, thank you. I wanted to go back to Tims because you talked about – I think some of the disappointment in the LTOs – when I compare what I’ve heard from you versus some of your competitors, cold has been doing very well for some competitors. Likewise, I don’t think or recall seeing quite as much check pressure for example from loyalty launches for an extended period of time. So, just as I compare on an execution perspective, do you need to make more fundamental changes there with respect to whether it’s your approach to loyalty, the maybe broadening the team or who you have in place running the brand. I’m just trying to understand why there has been and seems to be such a distinction between some of the initiatives at Tims versus what we’ve seen elsewhere? Thanks. José Cil: Thanks, Sara. As it relates to Tims, I think I provided quite a bit of color on the rewards program. So our focus there is to evolve from step one or phase one of attracting guests into the program and to step two which is kind of evolving, getting more folks on the digital platform and then personalize the offers so that it becomes an incremental visit and/or add-on and it drives incremental growth for our franchise owners and for the business. So that’s going to be the focus and it’s not so much structural as it is kind of an evolution – a planned evolution of the program as I’ve mentioned earlier. On cold beverages, we continue to see growth of the platform year-over-year, but I think – and the team thinks that this is a huge opportunity for us to make it an even bigger part of our business in Canada. We have a strong, kind of dominant and kind of legacy-built heritage on hot coffee and brewed coffee. We’re evolving to make it a more modern kind of broad-based offering including cold beverages and the launch of a lot of the LTOs and kind of platforms that we included in Q2 and Q3. So our progress, creamy chills being one of them and we’ll continue to innovate there and drive improved growth in that platform which we think is important. And I feel really good about the team that we have in Canada. We are always looking for one of the hallmarks of our company and our culture is constantly looking for great talent to continue to build our amazing teams to drive the business forward. So we are excited about the team that we have, excited about the progress we’re making and look forward to keeping you guys updated on our progress. Thanks for the question.

Our next question today comes from David Palmer of Evercore ISI. Please go ahead.

Thank you. Great discussion on Tims, so thank you for this. A question on the digital elements of loyalty in the personalized marketing upside, you talked about going forward, it’s is my understanding, correct me if I’m wrong that most of the loyalty occasions are swipe cards and not in app at this moment. Could you talk about the connectivity and how you can improve engagement to that personalized consumer level that you’re talking about and where you are sort of technology wise versus maybe program wise in that goal? Thanks.

Hi, Dave. Good morning, it’s Josh and thanks for the question. You’re right that the majority of the program today is based on swipe cards as opposed to being in an in-app program, though there is a large part of the program that’s in the app. And you’re also right in – I think kind of thinking forward that where will likely go with the program is having a more digitally focused program, which will allow us to be more connected with our consumers and have a closer one-on-one interaction with those consumers. So it’s something we’re still working on. But I think likely as we look forward over the next 6 months to 12 months that is – will be a prominent part of the direction of the Tims Rewards program.

Our next question today comes from David Tarantino of Baird. Please go ahead.

Hi, good morning. Question on Burger King U.S. comps, I know you mentioned Impossible Whopper is likely one of the bigger drivers of the acceleration you’ve seen. So just wondering if you could elaborate on what you’re seeing as that program has moved on, I know you probably got a lot of trial upfront, but is that sustaining as you see it in the longer weeks of the program and I guess talk about the dynamics that maybe you saw when you launched it system wide versus what you saw in test as well? Thanks. José Cil: Hey, David. Thanks for the question. On Impossible, we saw a really good performance on the national launch. We were essentially in line with what we expected. We expected to see incremental traffic coming from existing guests and new guests. And as I mentioned in my opening remarks, there was a lot of traffic and trial that came in from new guests and even in my own experiences in the restaurants visiting during the quarter, I had a chance to speak to many customers and essentially new BK guests that were coming in specifically for that product and the feedback was really positive. I think both in terms of innovation, and bringing to the table and across the country of product that is innovative. It’s different and it takes great which is what’s most important about the Impossible Whopper. Over we don’t discuss specific performance and details of the product over the quarter beyond, but we continue to see good performance of the product of the Impossible Whopper and we are excited about it being a long term platform for the business we’re going to continue to invest behind it. We are going to continue to work closely with our franchise partners and the folks from Impossible to continue to drive great tasting innovation in that platform over time. Thanks for the question.

Our next question today comes from Will Slabaugh of Stephens, Inc. Please go ahead.

Yes, thanks guys. I had a question on Popeyes and curious what this did from a franchisee profitability standpoint as you look at the success of the Chicken Sandwich and what I’m assuming was generally higher check, and so how those guys are feeling and feedback you’ve gotten from the franchisees. And then can you speak a little bit more to the U.S. franchise unit expansion interest and I’m assuming this quarter didn’t do much to hurt that interest? José Cil: Hey, Will. Thanks for the question. We don’t really disclose our share too much from quarter to quarter on franchise profitability, because it tends to bounce around at times over the long haul. We’ve seen growth in the Popeyes four-wall margins and EBITDA in the U.S. and the performance of the Chicken Sandwich and a strong performance in the quarter as you say rightly say it didn’t hurt. So we saw a lot of positive momentum and the performance for the quarter was really good. Our franchisees – we just finished our convention late last week here in Miami and we had over a 1,000 – almost 1,500 owners and others that are close to the Popeyes system here in Miami. And there was a lot of excitement about the Popeyes Chicken Sandwich launch and the re-launch that we announced earlier this morning and we feel over time, a continued expansion of our menu, making the Chicken Sandwich available full time across 2,500 restaurants in the U.S. and growing. I think we will have a really positive impact in terms of the guest experience. That’s going to drive trial and growth in check and ultimately we know that that’s a key driver – seeing top line growth is going to be a key driver of four-wall EBITDA for the long haul. So we are really positive about that. And as it relates to the restaurant expansion in the U.S., there is a lot of excitement from existing franchisees as well as new franchisees that are looking to expand and partner with us to expand the brand in different parts of the country where we have quite a bit of white space and opportunity for growth for the Popeyes brand. So we’re looking forward to continuing to partner with great operators, great Investors with great management teams that are excited about building really good looking restaurants and building the Popeyes brand in the U.S. for the long time to come.

And our final question today comes from Eric Gonzalez of KeyBanc Capital Markets. Please go ahead.

Hey, thanks for squeezing me in. On Burger King U.S., I think in your Analyst Day, there was some discussion about your efforts to drive the morning business, if you could tell us what – what percentage of sales and what percentage of franchisee profit that breakfast represents today? And then how do you think about the impact on the industry as another large competitor plans to enter the marketplace? Thanks. José Cil: Hey, Eric. Thanks for the question. Breakfast as we mentioned in May is a big part of our plan, long-term after BK in the U.S. It’s one of the fastest growing dayparts in the U.S. It’s also one of the most profitable dayparts as well given very healthy margins in that business. We continue to invest behind it, both in terms of product quality innovation, beverage innovation and we’re investing in media over time. We’re excited about the long-term plans there. We have already a pretty healthy and strong business in breakfast right around 14%, 15% on average for the U.S. with some parts of the country, well north or north of 20% and we are excited about our position. We’ve already invested over decades behind the platform we have the people already working the daypart. We’ve already got customer or guest behaviors are in place to come to Burger King, they loved it for sandwich they love some of our anchor products at BK for breakfast. And we aim to continue to expand and innovate in the area to be able to drive more growth over time. Thanks for the question.

This concludes the question-and-answer-session. I’d like to turn the conference back over to José Cil for any closing remarks. José Cil: Thanks everyone. Overall, we had a strong quarter with about 9% system-wide sales growth, which led to adjusted EBITDA growth of 7%, the strongest we’ve seen since 2017. We’re excited to continue to show the progress of each of our amazing brands over the next quarters and look forward to keeping you posted. Thanks again to everyone for joining us this morning and thank you again for your support. Have a great day.

Thank you, sir. Today’s conference has now concluded and we thank you all for attending today’s presentation. You may now disconnect your lines and have a wonderful day.