The new owner of Tim Hortons Inc. gave its shareholders a taste of the coffee-and-doughnut chain's no-frills approach to its business.
Restaurant Brands International Inc. (RBI), which acquired Tim Hortons in December and also owns Burger King Worldwide Inc., held its first annual meeting on Wednesday – a lower-key affair than those of the past in a more remote location for many shareholders.
It took place at its new head office in Oakville, about a 50-minute drive west of Toronto, at 8 a.m., while in the past the meeting was held at times and places that were more convenient for many of its shareholders – generally at a Toronto hotel or event centre in the late morning.
Wednesday's meeting was more modest – no displays or video presentations – and sparsely attended, with roughly 35 people in the audience, including RBI employees, compared with crowded affairs of the past. The company served a few different pastries and croissants, each cut in half, and coffee, not quite the breadth of past offerings.
The meeting gave shareholders a flavour of the no-nonsense management style of RBI, which is owned by 3G Capital Partners LP of Brazil. It is known for its low-cost business strategy: At other companies it has taken over, such as H.J. Heinz Co. and Anheuser-Busch InBev SA (the parent of Labatt Brewing Co. Ltd.), 3G has been quick to cut expenses and staff. The same is happening at Tim Hortons.
Shareholder Lawson Huang said in an interview later that he was disappointed he had to drive from Toronto so early in the morning to attend the RBI annual meeting. Despite his frustration, he said he plans to hold on to his "few hundred" shares.
Another shareholder asked company executives what they could do to inject more "enthusiasm" into their presentations, suggesting the "passion" of the past was missing.
Daniel Schwartz, chief executive officer of RBI and former CEO of Burger King, insisted that "nothing has changed."
"In fact, we're trying to do even more than we did before," said Mr. Schwartz, wearing a sports jacket over an open-collar shirt and khakis.
Recent sales results have been strong, he noted. Same-store sales at Tim Hortons in its first quarter rose 5.3 per cent, including 8.9 per cent at its U.S. restaurants where it has often struggled in the past, and 4.9 per cent in Canada.
Early this year, the café chain chopped 350 jobs, or about 15 per cent of its 2,300 employees, at headquarters and regional offices. In May, it closed its U.S. head office, although it did not say how many jobs were affected.
Mr. Schwartz said the company is still intent on expanding Tim Hortons in the U.S. and beyond, partnering with experienced franchisees in other markets.
He cited the company's new "innovation centre" as an example of its improvements for employees. Serving as its corporate head office in Oakville, it's a former warehouse-office space of Tim Hortons across the street from its past headquarters, which are now vacant. The former head office is owned by the company but it has no plans "at this time" to list it for sale, spokeswoman Michelle Robichaud said.
The newly renovated space is a bright, white-painted, open-office concept with high ceilings and rows of staff at their desks facing a central foyer at the entrance.
Mr. Schwartz said the company is committed to making more charitable contributions and keeping in close contact with its restaurants' local communities, as it has in the past.
Another shareholder asked if RBI would consider increasing employee compensation, as U.S. discounter Wal-Mart Stores Inc. and other American retailers are doing in response to protests about low minimum wages.
In Canada, Tim Hortons and other chains have come under attack for using temporary foreign workers under a federal program that allowed them to be paid lower wages. Ottawa changed its legislation recently to restrict the scheme and send home the workers as their permits expire.
Mr. Schwartz said company executives discuss wage issues a lot. But he said most of its restaurants are run by franchisees, who manage their own business and employee pay. "It's for them to make their decisions."
He said the most important impact that corporate executives can have is to help franchisees increase their profits so that there is enough money in the future to pay staff better wages.