Burger King rebounds, posts profit

Despite delayed openings in the Middle East and Germany, and early closures of restaurants in the UK, Burger King has posted a fourth quarter profit.

Although store-opening delays in the Middle East due to permitting issues contributed to a lower than expected rise, the company has completed its first year of being publicly traded with a five-fold profit rise, to $148 million.

For the three months ended June 30, Burger King earned $36 million, or 26 cents per share, versus a loss of $10 million, or 8 cents pershare a year ago. Sales rose 11% to $590 million from $533 million a year ago.

A modernisation campaign, which included longer opening hours, a new hip hop ad campaign and a possible move to trans-fat free cooking helped to raise worldwide comparable sales by 4.4% for the quarter and 3.4% for the fiscal year.

Worldwide restaurant sales reached a record $1.19 million in 2007, up from $1.13 million in 2006.

Burger King opened 441 restaurants in 2007, but store closings resulted in net openings of only 154 new restaurants.

The opening delays in the Middle East and closure of 30 struggling restaurants in the UK were responsible for the company's failure to meet it projected 200 openings in 2007.

The chain still faces an uphill battle to effectively manage food costs and fight stiff competition if it wants to continue its momentum. The restaurant hopes to open 300 new stores in 2008.

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