RBI Reaffirms Growth Algorithm, including 8%+ Organic Adjusted Operating Income Growth and 5%+ Net Restaurant Growth by 2028, with Plans to Return $1.6 Billion of Capital to Shareholders in 2026

Executive Summary

• RBI reaffirmed its 2028 growth algorithm targeting ≥8% organic Adjusted Operating Income growth and ≥5% net restaurant growth, with a path to become an investment‑grade company by 2028.
• The company announced a $1.6 billion capital return program for 2026, including a $500 million share repurchase initiation and continuation of its dividend.
• Detailed expansion plans outline 1,800 net new restaurants per year by 2028 across the U.S./Canada, China, and international markets, supported by brand‑specific growth engines.

Key Details

• Growth Outlook: Reaffirmed ≥8% organic Adjusted Operating Income (AOI) growth annually from 2024‑2028; already delivered >8% in both 2024 and 2025.
• Net Restaurant Growth: Target ≥5% annual net restaurant growth through 2028 (~1,800 net new units per year).
• Capital Return Plan (2026):
• Total of >$1.6 billion to be returned to shareholders in 2026 via dividends and share repurchases.
• Initial $500 million share repurchase program launched in 2026; subsequent buybacks to use the majority of excess free cash flow.
• Investment‑Grade Goal: Aim to achieve corporate investment‑grade leverage (≈4.0× net debt/EBITDA) by 2026 and low‑mid‑3× by 2028.
• Simplification Roadmap:
• Sunset the Restaurant Holdings segment by end‑2027, refranchising most company‑owned Burger King U.S. restaurants (target 300‑500 retained).
• Place Popeyes China and Firehouse Brazil with long‑term local partners.
• Capital Expenditure Outlook:
• Capex & cash inducements projected at ~$400 million in 2026‑27, decreasing to ~ $300 million from 2028 onward.
• Brand‑Specific Expansion Plans:
• U.S./Canada (300‑400 net new units/yr): Firehouse Subs (~150‑200), Tim Hortons & Popeyes split the remainder.
• China (300‑400 net new units/yr): Burger King China partnership with CPE to add >200 units in 2028; Popeyes China & Tim Hortons China contribute additional 100‑200 units.
• International excl. China (~1,100 net new units/yr): Top 10 markets (India, UK, Mexico, France, Japan) ~700 units; remaining 175 brand‑market combos ~400 units.
• Burger King “Reclaim the Flame” Update:
• Four years of comparable sales outperformance since 2022; guest experience ranking improved from 10th to 6th.
• Franchisee profitability increased to ~$205k (2023‑24).
• 97% of franchisees voted to maintain a 4.5% ad fund contribution through at least 2027; continuation contingent on $230k profitability or further vote in 2028.
• Dividend Policy: Long‑term target payout ratio ~60%; dividend described as “durable and growing.”
• AI Initiative: Introduction of “BK Assistant,” an AI‑powered operational tool for managers (inventory, compliance, guidelines).

Notable Quotes

• Josh Kobza, CEO: Emphasized the company’s focus on a simpler, stronger, more franchised model delivering 5%+ net restaurant growth and double‑digit shareholder returns.
• Sami Siddiqui, CFO: Highlighted the commitment to become a 99% franchised, investment‑grade business with flexible capital allocation.
• Patrick Doyle, Executive Chairman: Stressed disciplined capital allocation and franchisee profitability as core to long‑term success.