Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Oct. 18, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-36786 | |
Entity Registrant Name | RESTAURANT BRANDS INTERNATIONAL INC. | |
Entity Incorporation, State or Country Code | Z4 | |
Entity Tax Identification Number | 98-1202754 | |
Entity Address, Address Line One | 130 King Street West, Suite 300 | |
Entity Address, City or Town | Toronto, | |
Entity Address, State or Province | ON | |
Entity Address, Postal Zip Code | M5X 1E1 | |
City Area Code | 905 | |
Local Phone Number | 339-6011 | |
Title of 12(b) Security | Common Shares, without par value | |
Trading Symbol | QSR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 315,071,796 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001618756 | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 1,773 | $ 1,560 |
Accounts and notes receivable, net of allowance of $18 and $42, respectively | 537 | 536 |
Inventories, net | 96 | 96 |
Prepaids and other current assets | 178 | 72 |
Total current assets | 2,584 | 2,264 |
Property and equipment, net of accumulated depreciation and amortization of $963 and $879, respectively | 2,013 | 2,031 |
Operating lease assets, net | 1,118 | 1,152 |
Intangible assets, net | 10,652 | 10,701 |
Goodwill | 5,743 | 5,739 |
Net investment in property leased to franchisees | 79 | 66 |
Other assets, net | 739 | 824 |
Total assets | 22,928 | 22,777 |
Current liabilities: | ||
Accounts and drafts payable | 592 | 464 |
Other accrued liabilities | 910 | 835 |
Gift card liability | 137 | 191 |
Current portion of long-term debt and finance leases | 113 | 111 |
Total current liabilities | 1,752 | 1,601 |
Long-term debt, net of current portion | 12,379 | 12,397 |
Finance leases, net of current portion | 328 | 315 |
Operating lease liabilities, net of current portion | 1,056 | 1,082 |
Other liabilities, net | 1,898 | 2,236 |
Deferred income taxes, net | 1,407 | 1,425 |
Total liabilities | 18,820 | 19,056 |
Shareholders’ equity: | ||
Common shares, no par value; Unlimited shares authorized at September 30, 2021 and December 31, 2020; 315,065,839 shares issued and outstanding at September 30, 2021; 304,718,749 shares issued and outstanding at December 31, 2020 | 2,490 | 2,399 |
Retained earnings | 779 | 622 |
Accumulated other comprehensive income (loss) | (753) | (854) |
Total Restaurant Brands International Inc. shareholders’ equity | 2,516 | 2,167 |
Noncontrolling interests | 1,592 | 1,554 |
Total shareholders’ equity | 4,108 | 3,721 |
Total liabilities and shareholders’ equity | $ 22,928 | $ 22,777 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Financing receivable, allowance for credit loss, current | $ 18 | $ 42 |
Accumulated depreciation and amortization | $ 963 | $ 879 |
Common stock, par value (in usd per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | Unlimited | Unlimited |
Common stock, shares issued (in shares) | 315,065,839 | 304,718,749 |
Common stock, shares outstanding (in shares) | 315,065,839 | 304,718,749 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenues: | ||||
Total revenues | $ 1,495 | $ 1,337 | $ 4,193 | $ 3,610 |
Operating costs and expenses: | ||||
Cost of sales | 490 | 418 | 1,358 | 1,156 |
Franchise and property expenses | 121 | 125 | 358 | 380 |
Advertising expenses | 237 | 209 | 711 | 638 |
General and administrative expenses | 123 | 96 | 341 | 292 |
(Income) loss from equity method investments | 7 | 18 | 12 | 36 |
Other operating expenses (income), net | (16) | 54 | (50) | 59 |
Total operating costs and expenses | 962 | 920 | 2,730 | 2,561 |
Income from operations | 533 | 417 | 1,463 | 1,049 |
Interest expense, net | 128 | 129 | 378 | 376 |
Loss on early extinguishment of debt | 11 | 0 | 11 | 0 |
Total before tax | 394 | 288 | 1,074 | 673 |
Income tax expense | 65 | 65 | 83 | 62 |
Net income | 329 | 223 | 991 | 611 |
Net income attributable to noncontrolling interests | 108 | 78 | 332 | 216 |
Net income attributable to common shareholders | $ 221 | $ 145 | $ 659 | $ 395 |
Earnings per common share | ||||
Basic (in usd per share) | $ 0.71 | $ 0.48 | $ 2.14 | $ 1.31 |
Diluted (in usd per share) | $ 0.70 | $ 0.47 | $ 2.12 | $ 1.30 |
Weighted average shares outstanding | ||||
Basic (in shares) | 311 | 303 | 308 | 301 |
Diluted (in shares) | 465 | 470 | 465 | 469 |
Sales | ||||
Revenues: | ||||
Sales | $ 621 | $ 541 | $ 1,718 | $ 1,450 |
Franchise and property revenues | ||||
Revenues: | ||||
Sales | 639 | 577 | 1,801 | 1,552 |
Advertising revenues | ||||
Revenues: | ||||
Sales | $ 235 | $ 219 | $ 674 | $ 608 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 329 | $ 223 | $ 991 | $ 611 |
Foreign currency translation adjustment | (257) | 239 | (62) | (170) |
Net change in fair value of net investment hedges, net of tax of $(31), $40, $10 and $(12) | 143 | (198) | 101 | 39 |
Net change in fair value of cash flow hedges, net of tax of $(4), $7, $(32) and $99 | 13 | (17) | 68 | (268) |
Amounts reclassified to earnings of cash flow hedges, net of tax of $(9), $(8), $(21) and $(18) | 24 | 22 | 77 | 51 |
Gain (loss) recognized on other, net of tax of $0, $0, $0 and $0 | 0 | 0 | 2 | 0 |
Other comprehensive income (loss) | (77) | 46 | 186 | (348) |
Comprehensive income (loss) | 252 | 269 | 1,177 | 263 |
Comprehensive income (loss) attributable to noncontrolling interests | 83 | 94 | 395 | 91 |
Comprehensive income (loss) attributable to common shareholders | $ 169 | $ 175 | $ 782 | $ 172 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net change in fair value of net investment hedges, tax | $ (31) | $ 40 | $ 10 | $ (12) |
Net change in fair value of cash flow hedges, tax | (4) | 7 | (32) | 99 |
Amounts reclassified to earnings of cash flow hedges, tax | (9) | (8) | (21) | (18) |
Gain (loss) recognized on other, tax | $ 0 | $ 0 | $ 0 | $ 0 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Shareholders' Equity - USD ($) $ in Millions | Total | Issued Common Shares | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest |
Beginning balances (in shares) at Dec. 31, 2019 | 298,281,081 | ||||
Beginning balances at Dec. 31, 2019 | $ 4,259 | $ 2,478 | $ 775 | $ (763) | $ 1,769 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock option exercises (in shares) | 1,053,264 | ||||
Stock option exercises | 30 | $ 30 | |||
Share-based compensation | 19 | $ 19 | |||
Issuance of shares (in shares) | 255,325 | ||||
Issuance of shares | 6 | $ 6 | |||
Dividends declared | (156) | (156) | |||
Dividend equivalents declared on restricted stock units | 0 | $ 2 | (2) | ||
Distributions declared by Partnership on Partnership exchangeable units | (86) | (86) | |||
Exchange of partnership exchangeable units for RBI common shares (in shares) | 178,046 | ||||
Exchange of Partnership exchangeable units for RBI common shares | 0 | $ 2 | (2) | ||
Restaurant VIE contributions (distributions) | (1) | (1) | |||
Net income | 224 | 144 | 80 | ||
Other comprehensive income (loss) | (543) | (350) | (193) | ||
Ending balances (in shares) at Mar. 31, 2020 | 299,767,716 | ||||
Ending balances at Mar. 31, 2020 | 3,752 | $ 2,537 | 761 | (1,113) | 1,567 |
Beginning balances (in shares) at Dec. 31, 2019 | 298,281,081 | ||||
Beginning balances at Dec. 31, 2019 | 4,259 | $ 2,478 | 775 | (763) | 1,769 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 611 | ||||
Other comprehensive income (loss) | (348) | ||||
Ending balances (in shares) at Sep. 30, 2020 | 303,877,203 | ||||
Ending balances at Sep. 30, 2020 | 3,915 | $ 2,648 | 692 | (997) | 1,572 |
Beginning balances (in shares) at Mar. 31, 2020 | 299,767,716 | ||||
Beginning balances at Mar. 31, 2020 | 3,752 | $ 2,537 | 761 | (1,113) | 1,567 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock option exercises (in shares) | 316,172 | ||||
Stock option exercises | 11 | $ 11 | |||
Share-based compensation | 20 | $ 20 | |||
Issuance of shares (in shares) | 45,071 | ||||
Issuance of shares | 0 | ||||
Dividends declared | (158) | (158) | |||
Dividend equivalents declared on restricted stock units | 0 | $ 1 | (1) | ||
Distributions declared by Partnership on Partnership exchangeable units | (85) | (85) | |||
Exchange of partnership exchangeable units for RBI common shares (in shares) | 2,494,854 | ||||
Exchange of Partnership exchangeable units for RBI common shares | 0 | $ 33 | (9) | (24) | |
Restaurant VIE contributions (distributions) | (1) | (1) | |||
Net income | 164 | 106 | 58 | ||
Other comprehensive income (loss) | 149 | 97 | 52 | ||
Ending balances (in shares) at Jun. 30, 2020 | 302,623,813 | ||||
Ending balances at Jun. 30, 2020 | 3,852 | $ 2,602 | 708 | (1,025) | 1,567 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock option exercises (in shares) | 567,636 | ||||
Stock option exercises | 19 | $ 19 | |||
Share-based compensation | 16 | $ 16 | |||
Issuance of shares (in shares) | 63,686 | ||||
Issuance of shares | 0 | ||||
Dividends declared | (158) | (158) | |||
Dividend equivalents declared on restricted stock units | 0 | $ 3 | (3) | ||
Distributions declared by Partnership on Partnership exchangeable units | (84) | (84) | |||
Exchange of partnership exchangeable units for RBI common shares (in shares) | 622,068 | ||||
Exchange of Partnership exchangeable units for RBI common shares | 0 | $ 8 | (2) | (6) | |
Restaurant VIE contributions (distributions) | 1 | 1 | |||
Net income | 223 | 145 | 78 | ||
Other comprehensive income (loss) | 46 | 30 | 16 | ||
Ending balances (in shares) at Sep. 30, 2020 | 303,877,203 | ||||
Ending balances at Sep. 30, 2020 | $ 3,915 | $ 2,648 | 692 | (997) | 1,572 |
Beginning balances (in shares) at Dec. 31, 2020 | 304,718,749 | 304,718,749 | |||
Beginning balances at Dec. 31, 2020 | $ 3,721 | $ 2,399 | 622 | (854) | 1,554 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock option exercises (in shares) | 530,963 | ||||
Stock option exercises | 20 | $ 20 | |||
Share-based compensation | 22 | $ 22 | |||
Issuance of shares (in shares) | 1,636,858 | ||||
Issuance of shares | 9 | $ 9 | |||
Dividends declared | (163) | (163) | |||
Dividend equivalents declared on restricted stock units | 0 | $ 3 | (3) | ||
Distributions declared by Partnership on Partnership exchangeable units | (82) | (82) | |||
Exchange of partnership exchangeable units for RBI common shares (in shares) | 72,671 | ||||
Exchange of Partnership exchangeable units for RBI common shares | 0 | $ 1 | (1) | ||
Restaurant VIE contributions (distributions) | 1 | 1 | |||
Net income | 271 | 179 | 92 | ||
Other comprehensive income (loss) | 203 | 135 | 68 | ||
Ending balances (in shares) at Mar. 31, 2021 | 306,959,241 | ||||
Ending balances at Mar. 31, 2021 | $ 4,002 | $ 2,454 | 635 | (719) | 1,632 |
Beginning balances (in shares) at Dec. 31, 2020 | 304,718,749 | 304,718,749 | |||
Beginning balances at Dec. 31, 2020 | $ 3,721 | $ 2,399 | 622 | (854) | 1,554 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 991 | ||||
Other comprehensive income (loss) | $ 186 | ||||
Ending balances (in shares) at Sep. 30, 2021 | 315,065,839 | 315,065,839 | |||
Ending balances at Sep. 30, 2021 | $ 4,108 | $ 2,490 | 779 | (753) | 1,592 |
Beginning balances (in shares) at Mar. 31, 2021 | 306,959,241 | ||||
Beginning balances at Mar. 31, 2021 | 4,002 | $ 2,454 | 635 | (719) | 1,632 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock option exercises (in shares) | 958,671 | ||||
Stock option exercises | 37 | $ 37 | |||
Share-based compensation | 18 | $ 18 | |||
Issuance of shares (in shares) | 34,858 | ||||
Issuance of shares | 0 | ||||
Dividends declared | (164) | (164) | |||
Dividend equivalents declared on restricted stock units | 0 | $ 2 | (2) | ||
Distributions declared by Partnership on Partnership exchangeable units | (82) | (82) | |||
Exchange of partnership exchangeable units for RBI common shares (in shares) | 87,767 | ||||
Exchange of Partnership exchangeable units for RBI common shares | 0 | $ 1 | (1) | ||
Restaurant VIE contributions (distributions) | (3) | (3) | |||
Net income | 391 | 259 | 132 | ||
Other comprehensive income (loss) | 60 | 40 | 20 | ||
Ending balances (in shares) at Jun. 30, 2021 | 308,040,537 | ||||
Ending balances at Jun. 30, 2021 | 4,259 | $ 2,512 | 728 | (679) | 1,698 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock option exercises (in shares) | 93,012 | ||||
Stock option exercises | 4 | $ 4 | |||
Share-based compensation | 22 | $ 22 | |||
Issuance of shares (in shares) | 92,888 | ||||
Dividends declared | (167) | (167) | |||
Dividend equivalents declared on restricted stock units | $ 3 | (3) | |||
Distributions declared by Partnership on Partnership exchangeable units | (77) | (77) | |||
Exchange of partnership exchangeable units for RBI common shares (in shares) | 9,682,964 | ||||
Exchange of Partnership exchangeable units for RBI common shares | $ 131 | (22) | (109) | ||
Repurchase of RBI common shares (in shares) | (2,843,562) | ||||
Repurchase of RBI common shares | (182) | $ (182) | |||
Restaurant VIE contributions (distributions) | (3) | (3) | |||
Net income | 329 | 221 | 108 | ||
Other comprehensive income (loss) | $ (77) | (52) | (25) | ||
Ending balances (in shares) at Sep. 30, 2021 | 315,065,839 | 315,065,839 | |||
Ending balances at Sep. 30, 2021 | $ 4,108 | $ 2,490 | $ 779 | $ (753) | $ 1,592 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Common stock, dividends declared (in usd per share) | $ 0.53 | $ 0.53 | $ 0.53 | $ 0.52 | $ 0.52 | $ 0.52 |
Dividend distributions declared (in usd per share) | $ 0.53 | $ 0.53 | $ 0.53 | $ 0.52 | $ 0.52 | $ 0.52 |
Condensed Consolidated Statem_6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 991 | $ 611 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 150 | 139 |
Premiums paid and non-cash loss on early extinguishment of debt | 11 | 0 |
Amortization of deferred financing costs and debt issuance discount | 20 | 19 |
(Income) loss from equity method investments | 12 | 36 |
(Gain) loss on remeasurement of foreign denominated transactions | (58) | 54 |
Net (gains) losses on derivatives | 65 | 14 |
Share-based compensation expense | 62 | 55 |
Deferred income taxes | 35 | (120) |
Other | (14) | 23 |
Changes in current assets and liabilities, excluding acquisitions and dispositions: | ||
Accounts and notes receivable | 11 | (83) |
Inventories and prepaids and other current assets | (3) | (21) |
Accounts and drafts payable | 129 | (110) |
Other accrued liabilities and gift card liability | (78) | (12) |
Tenant inducements paid to franchisees | (5) | (7) |
Other long-term assets and liabilities | (73) | 10 |
Net cash provided by operating activities | 1,255 | 608 |
Cash flows from investing activities: | ||
Payments for property and equipment | (70) | (71) |
Net proceeds from disposal of assets, restaurant closures, and refranchisings | 14 | 9 |
Settlement/sale of derivatives, net | 2 | 29 |
Other investing activities, net | (15) | 0 |
Net cash (used for) provided by investing activities | (69) | (33) |
Cash flows from financing activities: | ||
Proceeds from revolving line of credit and long-term debt | 802 | 1,585 |
Repayments of revolving line of credit, long-term debt and finance leases | (865) | (1,071) |
Payment of financing costs | (7) | (10) |
Payment of dividends on common shares and distributions on Partnership exchangeable units | (730) | (716) |
Repurchase of common shares | (182) | 0 |
Proceeds from stock option exercises | 60 | 60 |
(Payments) proceeds from derivatives | (45) | (29) |
Other financing activities, net | (3) | (1) |
Net cash (used for) provided by financing activities | (970) | (182) |
Effect of exchange rates on cash and cash equivalents | (3) | (7) |
Increase (decrease) in cash and cash equivalents | 213 | 386 |
Cash and cash equivalents at beginning of period | 1,560 | 1,533 |
Cash and cash equivalents at end of period | 1,773 | 1,919 |
Supplemental cash flow disclosures: | ||
Interest paid | 281 | 315 |
Income taxes paid | $ 189 | $ 163 |
Description of Business and Org
Description of Business and Organization | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Organization | Description of Business and Organization Restaurant Brands International Inc. (the “Company”, “RBI”, “we”, “us” or “our”) is a Canadian corporation that serves as the sole general partner of Restaurant Brands International Limited Partnership (“Partnership”). We franchise and operate quick service restaurants serving premium coffee and other beverage and food products under the Tim Hortons ® brand (“Tim Hortons” or “TH”), fast food hamburgers principally under the Burger King ® brand (“Burger King” or “BK”), and chicken under the Popeyes ® brand (“Popeyes” or “PLK”). We are one of the world’s largest quick service restaurant, or QSR, companies as measured by total number of restaurants. As of September 30, 2021, we franchised or owned 5,137 Tim Hortons restaurants, 18,923 Burger King restaurants, and 3,607 Popeyes restaurants, for a total of 27,667 restaurants, and operate in more than 100 countries. Approximately 100% of current system-wide restaurants are franchised. All references to “$” or “dollars” are to the currency of the United States unless otherwise indicated. All references to “Canadian dollars” or “C$” are to the currency of Canada unless otherwise indicated. |
Basis of Presentation and Conso
Basis of Presentation and Consolidation | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation We have prepared the accompanying unaudited condensed consolidated financial statements (the “Financial Statements”) in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements. Therefore, the Financial Statements should be read in conjunction with the audited consolidated financial statements contained in our Annual Report on Form 10-K filed with the SEC and Canadian securities regulatory authorities on February 23, 2021. The Financial Statements include our accounts and the accounts of entities in which we have a controlling financial interest, the usual condition of which is ownership of a majority voting interest. All material intercompany balances and transactions have been eliminated in consolidation. Investments in other affiliates that are owned 50% or less where we have significant influence are accounted for by the equity method. We are the sole general partner of Partnership and, as such we have the exclusive right, power and authority to manage, control, administer and operate the business and affairs and to make decisions regarding the undertaking and business of Partnership, subject to the terms of the amended and restated limited partnership agreement of Partnership (the “partnership agreement”) and applicable laws. As a result, we consolidate the results of Partnership and record a noncontrolling interest in our consolidated balance sheets and statements of operations with respect to the remaining economic interest in Partnership we do not hold. We also consider for consolidation entities in which we have certain interests, where the controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity (“VIE”), is required to be consolidated by its primary beneficiary. The primary beneficiary is the entity that possesses the power to direct the activities of the VIE that most significantly impact its economic performance and has the obligation to absorb losses or the right to receive benefits from the VIE that are significant to it. Our maximum exposure to loss resulting from involvement with VIEs is attributable to accounts and notes receivable balances, outstanding loan guarantees and future lease payments, where applicable. As our franchise and master franchise arrangements provide the franchise and master franchise entities the power to direct the activities that most significantly impact their economic performance, we do not consider ourselves the primary beneficiary of any such entity that might be a VIE. Tim Hortons has historically entered into certain arrangements in which an operator acquires the right to operate a restaurant, but Tim Hortons owns the restaurant’s assets. We perform an analysis to determine if the legal entity in which operations are conducted is a VIE and consolidate a VIE entity if we also determine Tim Hortons is the entity’s primary beneficiary (“Restaurant VIEs”). As of September 30, 2021 and December 31, 2020, we determined that we are the primary beneficiary of 49 and 38 Restaurant VIEs, respectively, and accordingly, have consolidated the results of operations, assets and liabilities, and cash flows of these Restaurant VIEs in our Financial Statements. Material intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation have been included in the Financial Statements. The results for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the full year. The preparation of consolidated financial statements in conformity with U.S. GAAP and related rules and regulations of the SEC requires our management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities. Actual results could differ from these estimates. The carrying amounts for cash and cash equivalents, accounts and notes receivable and accounts and drafts payable approximate fair value based on the short-term nature of these amounts. Certain prior year amounts in the accompanying Financial Statements and notes to the Financial Statements have been reclassified in order to be comparable with the current year classifications. These consist of the quarter and year to date September 30, 2020 reclassification of advertising fund contributions from Franchise and property revenues to Advertising revenues and advertising fund expenses from Selling, general and administrative expenses to Advertising expenses, with General and administrative expenses now presented separately. Depreciation and amortization expenses related to the advertising funds for the three and nine months ended September 30, 2020 have also been reclassified from Franchise and property expenses to Advertising expenses. These reclassifications did not arise as a result of any changes to accounting policies and relate entirely to presentation with no effect on previously reported net income. |
New Accounting Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Simplifying the Accounting for Income Taxes – In December 2019, the FASB issued guidance which simplifies the accounting for income taxes by removing certain exceptions and by clarifying and amending existing guidance applicable to accounting for income taxes . The amendment is effective commencing in 2021 with early adoption permitted. The adoption of this new guidance in 2021 did not have a material impact on our Financial Statements. Accounting Relief for the Transition Away from LIBOR and Certain other Reference Rates – In March 2020 and as clarified in January 2021, the FASB issued guidance which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. This amendment is effective as of March 12, 2020 through December 31, 2022. The expedients and exceptions provided by this new guidance do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationships. During the third quarter of 2021, we adopted certain of the expedients as it relates to hedge accounting as certain of our debt agreements and hedging relationships bear interest at variable rates, primarily US dollar LIBOR. The adoption of and future elections under this new guidance did not and are not expected to have a material impact on our Financial Statements. We will continue to monitor the discontinuance of LIBOR on our debt agreements and hedging relationships. Lessors—Certain Leases with Variable Lease Payments – In July 2021, the FASB issued guidance that requires lessors to classify and account for a lease with variable lease payments that do not depend on a reference index or a rate as an operating lease if (a) the lease would have been classified as a sales-type lease or a direct financing lease in accordance with lease classification criteria and (b) the lessor would have otherwise recognized a day-one loss. This amendment is effective in 2022 with early adoption permitted. This guidance may be applied either retrospectively to leases that commenced or were modified on or after the adoption of lease guidance we adopted in 2019 or prospectively to leases that commence or are modified on or after the date that this new guidance is applied. We are currently evaluating the impact but do not expect that the adoption of this new guidance will have a material impact on our Financial Statements. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases Property revenues consist primarily of lease income from operating leases and earned income on direct financing leases and sales-type leases with franchisees as follows (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Lease income - operating leases Minimum lease payments $ 113 $ 112 $ 343 $ 333 Variable lease payments 91 82 241 191 Amortization of favorable and unfavorable income lease contracts, net 1 1 3 4 Subtotal - lease income from operating leases 205 195 587 528 Earned income on direct financing and sales-type leases 1 1 4 4 Total property revenues $ 206 $ 196 $ 591 $ 532 |
Leases | Leases Property revenues consist primarily of lease income from operating leases and earned income on direct financing leases and sales-type leases with franchisees as follows (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Lease income - operating leases Minimum lease payments $ 113 $ 112 $ 343 $ 333 Variable lease payments 91 82 241 191 Amortization of favorable and unfavorable income lease contracts, net 1 1 3 4 Subtotal - lease income from operating leases 205 195 587 528 Earned income on direct financing and sales-type leases 1 1 4 4 Total property revenues $ 206 $ 196 $ 591 $ 532 |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Contract Liabilities Contract liabilities consist of deferred revenue resulting from initial and renewal franchise fees paid by franchisees, as well as upfront fees paid by master franchisees, which are generally recognized on a straight-line basis over the term of the underlying agreement. We may recognize unamortized upfront fees when a contract with a franchisee or master franchisee is modified and is accounted for as a termination of the existing contract. We classify these contract liabilities as Other liabilities, net in our condensed consolidated balance sheets. The following table reflects the change in contract liabilities between December 31, 2020 and September 30, 2021 (in millions): Contract Liabilities TH BK PLK Consolidated Balance at December 31, 2020 $ 62 $ 427 $ 39 $ 528 Recognized during period and included in the contract liability balance at the beginning of the year (7) (30) (2) (39) Increase, excluding amounts recognized as revenue during the period 8 24 14 46 Impact of foreign currency translation — (10) — (10) Balance at September 30, 2021 $ 63 $ 411 $ 51 $ 525 The following table illustrates estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2021 (in millions): Contract liabilities expected to be recognized in TH BK PLK Consolidated Remainder of 2021 $ 3 $ 9 $ 1 $ 13 2022 9 34 4 47 2023 9 33 3 45 2024 8 32 3 43 2025 7 32 3 42 Thereafter 27 271 37 335 Total $ 63 $ 411 $ 51 $ 525 Disaggregation of Total Revenues Total revenues consist of the following (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Sales $ 621 $ 541 $ 1,718 $ 1,450 Royalties 412 362 1,149 968 Property revenues 206 196 591 532 Franchise fees and other revenue 21 19 61 52 Advertising revenues 235 219 674 608 Total revenues $ 1,495 $ 1,337 $ 4,193 $ 3,610 |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share An economic interest in Partnership common equity is held by the holders of Class B exchangeable limited partnership units (the “Partnership exchangeable units”), which is reflected as a noncontrolling interest in our equity. See Note 12, Shareholders’ Equity . Basic and diluted earnings per share is computed using the weighted average number of shares outstanding for the period. We apply the treasury stock method to determine the dilutive weighted average common shares represented by outstanding equity awards, unless the effect of their inclusion is anti-dilutive. The diluted earnings per share calculation assumes conversion of 100% of the Partnership exchangeable units under the “if converted” method. Accordingly, the numerator is also adjusted to include the earnings allocated to the holders of noncontrolling interests. The following table summarizes the basic and diluted earnings per share calculations (in millions, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Numerator: Net income attributable to common shareholders - basic $ 221 $ 145 $ 659 $ 395 Add: Net income attributable to noncontrolling interests 107 78 329 215 Net income available to common shareholders and noncontrolling interests - diluted $ 328 $ 223 $ 988 $ 610 Denominator: Weighted average common shares - basic 311 303 308 301 Exchange of noncontrolling interests for common shares (Note 12) 151 162 154 164 Effect of other dilutive securities 3 5 3 4 Weighted average common shares - diluted 465 470 465 469 Basic earnings per share (a) $ 0.71 $ 0.48 $ 2.14 $ 1.31 Diluted earnings per share (a) $ 0.70 $ 0.47 $ 2.12 $ 1.30 Anti-dilutive securities outstanding 5 8 5 8 (a) Earnings per share may not recalculate exactly as it is calculated based on unrounded numbers. |
Intangible Assets, net and Good
Intangible Assets, net and Goodwill | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, net and Goodwill | Intangible Assets, net and Goodwill Intangible assets, net and goodwill consist of the following (in millions): As of September 30, 2021 December 31, 2020 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Identifiable assets subject to amortization: Franchise agreements $ 725 $ (283) $ 442 $ 735 $ (264) $ 471 Favorable leases 106 (63) 43 117 (66) 51 Subtotal 831 (346) 485 852 (330) 522 Indefinite-lived intangible assets: Tim Hortons brand $ 6,675 $ — $ 6,675 $ 6,650 $ — $ 6,650 Burger King brand 2,137 — 2,137 2,174 — 2,174 Popeyes brand 1,355 — 1,355 1,355 — 1,355 Subtotal 10,167 — 10,167 10,179 — 10,179 Intangible assets, net $ 10,652 $ 10,701 Goodwill Tim Hortons segment $ 4,293 $ 4,279 Burger King segment 604 614 Popeyes segment 846 846 Total $ 5,743 $ 5,739 Amortization expense on intangible assets totaled $10 million and $11 million for the three months ended September 30, 2021 and 2020, respectively. Amortization expense on intangible assets totaled $31 million and $33 million for the nine months ended September 30, 2021 and 2020, respectively. The change in the brands and goodwill balances during the nine months ended September 30, 2021 was due to the impact of foreign currency translation. |
Equity Method Investments
Equity Method Investments | 9 Months Ended |
Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method Investments The aggregate carrying amount of our equity method investments was $199 million and $205 million as of September 30, 2021 and December 31, 2020, respectively, and is included as a component of Other assets, net in our accompanying condensed consolidated balance sheets. Except for the following equity method investments, no quoted market prices are available for our other equity method investments. The aggregate market value of our 15.4% equity interest in Carrols Restaurant Group, Inc. (“Carrols”) based on the quoted market price on September 30, 2021 was approximately $34 million. The aggregate market value of our 9.4% equity interest in BK Brasil Operação e Assessoria a Restaurantes S.A. based on the quoted market price on September 30, 2021 was approximately $39 million. We have evaluated recent declines in the market value of these equity method investments and concluded they are not other than temporary and as such no impairments have been recognized at September 30, 2021. We have equity interests in entities that own or franchise Tim Hortons, Burger King and Popeyes restaurants. Franchise and property revenues recognized from franchisees that are owned or franchised by entities in which we have an equity interest consist of the following (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Revenues from affiliates: Royalties $ 111 $ 68 $ 254 $ 171 Advertising revenues 22 14 50 38 Property revenues 8 8 24 24 Franchise fees and other revenue 4 4 12 10 Total $ 145 $ 94 $ 340 $ 243 At September 30, 2021 and December 31, 2020, we had $39 million and $52 million, respectively, of accounts receivable, net from our equity method investments which were recorded in Accounts and notes receivable, net in our condensed consolidated balance sheets. With respect to our TH business, the most significant equity method investment is our 50% joint venture interest with The Wendy’s Company (the “TIMWEN Partnership”), which jointly holds real estate underlying Canadian combination restaurants. Distributions received from this joint venture were $3 million and $2 million during the three months ended September 30, 2021 and 2020, respectively. Distributions received from this joint venture were $9 million and $6 million during the nine months ended September 30, 2021 and 2020, respectively. We recognized $5 million and $4 million of rent expense associated with the TIMWEN Partnership during the three months ended September 30, 2021 and 2020, respectively. We recognized $13 million and $11 million of rent expense associated with the TIMWEN Partnership during the nine months ended September 30, 2021 and 2020, respectively. |
Other Accrued Liabilities and O
Other Accrued Liabilities and Other Liabilities, net | 9 Months Ended |
Sep. 30, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Accrued Liabilities and Other Liabilities, net | Other Accrued Liabilities and Other Liabilities, net Other accrued liabilities (current) and Other liabilities, net (noncurrent) consist of the following (in millions): As of September 30, December 31, Current: Dividend payable $ 244 $ 239 Interest payable 86 66 Accrued compensation and benefits 77 78 Taxes payable 164 122 Deferred income 51 42 Accrued advertising expenses 55 59 Restructuring and other provisions 17 12 Current portion of operating lease liabilities 137 137 Other 79 80 Other accrued liabilities $ 910 $ 835 Noncurrent: Taxes payable $ 553 $ 626 Contract liabilities 525 528 Derivatives liabilities 618 865 Unfavorable leases 68 81 Accrued pension 66 70 Deferred income 33 28 Other 35 38 Other liabilities, net $ 1,898 $ 2,236 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consists of the following (in millions): As of September 30, December 31, Term Loan B (due November 19, 2026) $ 5,256 $ 5,297 Term Loan A (due October 7, 2024) 717 731 2017 4.25% Senior Notes (due May 15, 2024) — 775 3.875% First Lien Senior Notes (due January 15, 2028) 1,550 750 2020 5.75% Senior Notes (due April 15, 2025) 500 500 2020 3.50% Senior Notes (due February 15, 2029) 750 750 2019 4.375% Senior Notes (due January 15, 2028) 750 750 2020 4.00% Senior Notes (due October 15, 2030) 2,900 2,900 TH Facility and other 175 178 Less: unamortized deferred financing costs and deferred issue discount (138) (155) Total debt, net 12,460 12,476 Less: current maturities of debt (81) (79) Total long-term debt $ 12,379 $ 12,397 Revolving Credit Facility As of September 30, 2021, we had no amounts outstanding under our senior secured revolving credit facility (the “Revolving Credit Facility”), had $2 million of letters of credit issued against the Revolving Credit Facility, and our borrowing availability under our Revolving Credit Facility was $998 million. Funds available under the Revolving Credit Facility may be used to repay other debt, finance debt or equity repurchases, fund acquisitions or capital expenditures and for other general corporate purposes. We have a $125 million letter of credit sublimit as part of the Revolving Credit Facility, which reduces our borrowing availability thereunder by the cumulative amount of outstanding letters of credit. TH Facility One of our subsidiaries entered into a non-revolving delayed drawdown term credit facility in a total aggregate principal amount of C$225 million with a maturity date of October 4, 2025 (the “TH Facility”). The interest rate applicable to the TH Facility is the Canadian Bankers’ Acceptance rate plus an applicable margin equal to 1.40% or the Prime Rate plus an applicable margin equal to 0.40%, at our option. Obligations under the TH Facility are guaranteed by four of our subsidiaries, and amounts borrowed under the TH Facility are secured by certain parcels of real estate. As of September 30, 2021, we had outstanding C$217 million under the TH Facility with a weighted average interest rate of 1.83%. First Lien Senior Notes On July 6, 2021, two of our subsidiaries (the “Borrowers”) issued $800 million of 3.875% first lien senior secured notes due January 15, 2028 (the “Additional Notes”). No principal payments are due until maturity and interest is paid semi-annually. The Additional Notes were issued as additional notes under the indenture, dated as of September 24, 2019, (the “2019 3.875% Senior Notes Indenture”) pursuant to which the Borrowers previously issued $750 million in aggregate principal amount of 3.875% first lien senior secured notes due January 15, 2028 during 2019 (the “2019 3.875% Senior Notes” and together with the Additional Notes, the “3.875% First Lien Senior Notes”). The Additional Notes are treated as a single series with the 2019 3.875% Senior Notes and have the same terms for all purposes under the 2019 3.875% Senior Notes Indenture, including waivers, amendments, redemptions and offers to purchase. The Additional Notes were priced at 100.250% of their face value. The net proceeds from the offering of the Additional Notes were used to redeem the remaining $775 million principal amount outstanding of the 2017 4.25% Senior Notes on July 15, 2021, plus any accrued and unpaid interest thereon, and pay related redemption premiums, fees and expenses. In connection with the issuance of the Additional Notes, we capitalized approximately $7 million in debt issuance costs. In connection with the redemption of the remaining $775 million principal amount outstanding of the 2017 4.25% Senior Notes, we recorded a loss on early extinguishment of debt of $11 million that primarily reflects the payment of redemption premiums and the write-off of unamortized debt issuance costs. Obligations under the 3.875% First Lien Senior Notes are guaranteed on a senior secured basis, jointly and severally, by the Borrowers and substantially all of the Borrower's Canadian and U.S. subsidiaries, including The TDL Group Corp., Burger King Corporation, Popeyes Louisiana Kitchen, Inc. and substantially all of their respective Canadian and U.S. subsidiaries (the “Note Guarantors”). The 3.875% First Lien Senior Notes are first lien senior secured obligations and rank equal in right of payment with all of the existing and future first lien senior debt of the Borrowers and Note Guarantors, including borrowings and guarantees under our senior secured term loan facilities and Revolving Credit Facility (together the “Credit Facilities”). The 3.875% First Lien Senior notes may be redeemed in whole or in part, on or after September 15, 2022, at the redemption prices set forth in the 2019 3.875% Senior Notes Indenture, plus accrued and unpaid interest, if any, at the date of redemption. The 2019 3.875% Senior Notes Indenture also contains optional redemption provisions related to tender offers, change of control and equity offerings, among others. Restrictions and Covenants As of September 30, 2021, we were in compliance with all applicable financial debt covenants under our senior secured term loan facilities and Revolving Credit Facility (together the "Credit Facilities"), the TH Facility, and the indentures governing our Senior Notes. Fair Value Measurement The following table presents the fair value of our variable rate term debt and senior notes, estimated using inputs based on bid and offer prices that are Level 2 inputs, and principal carrying amount (in millions): As of September 30, December 31, Fair value of our variable term debt and senior notes $ 12,391 $ 12,477 Principal carrying amount of our variable term debt and senior notes 12,423 12,453 Interest Expense, net Interest expense, net consists of the following (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Debt (a) $ 117 $ 119 $ 345 $ 351 Finance lease obligations 5 4 15 14 Amortization of deferred financing costs and debt issuance discount 7 7 20 19 Interest income (1) (1) (2) (8) Interest expense, net $ 128 $ 129 $ 378 $ 376 (a) Amount includes $11 million and $15 million benefit during the three months ended September 30, 2021 and 2020, respectively, and $34 million and $56 million benefit during the nine months ended September 30, 2021 and 2020, respectively, related to the quarterly net settlements of our cross-currency rate swaps and amortization of the Excluded Component as defined in Note 13, Derivatives . |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our effective tax rate was 16.7% and 7.7% for the three and nine months ended September 30, 2021, respectively. The effective tax rate during these periods reflects the mix of income from multiple tax jurisdictions and the impact of internal financing arrangements. Additionally, the effective tax rate for the nine months ended September 30, 2021 included a net decrease in tax reserves of $87 million related primarily to expiring statutes of limitations for certain prior tax years which decreased the effective tax rate by 8.1%. Our effective tax rate was 22.6% and 9.2% for the three and nine months ended September 30, 2020, respectively. The effective tax rate during these periods reflects the mix of income from multiple tax jurisdictions and the impact of internal financing arrangements. Additionally, the effective tax rate during the nine months ended September 30, 2020 reflects a $64 million increase in deferred tax assets which decreased the effective tax rate by 9.5% during this period. Based on the analysis of final guidance related to the Tax Cuts and Jobs Act (the “Tax Act”) received during the nine months ended September 30, 2020, a deferred tax asset was recorded. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Noncontrolling Interests The holders of Partnership exchangeable units held an economic interest of approximately 31.6% and 33.7% in Partnership common equity through the ownership of 145,269,936 and 155,113,338 Partnership exchangeable units as of September 30, 2021 and December 31, 2020, respectively. During the nine months ended September 30, 2021, Partnership exchanged 9,843,402 Partnership exchangeable units, pursuant to exchange notices received. In accordance with the terms of the partnership agreement, Partnership satisfied the exchange notices by exchanging these Partnership exchangeable units for the same number of newly issued RBI common shares. The exchanges represented increases in our ownership interest in Partnership and were accounted for as equity transactions, with no gain or loss recorded in the accompanying condensed consolidated statement of operations. Pursuant to the terms of the partnership agreement, upon the exchange of Partnership exchangeable units, each such Partnership exchangeable unit is automatically deemed cancelled concurrently with the exchange. Share Repurchases On July 28, 2021, our Board of Directors approved a share repurchase program that allows us to purchase up to $1,000 million of our common shares until August 10, 2023. For the three and nine months ended September 30, 2021, we repurchased and cancelled 2,843,562 of common shares for $182 million. Accumulated Other Comprehensive Income (Loss) The following table displays the changes in the components of accumulated other comprehensive income (loss) (“AOCI”) (in millions): Derivatives Pensions Foreign Currency Translation Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2020 $ (69) $ (30) $ (755) $ (854) Foreign currency translation adjustment — — (62) (62) Net change in fair value of derivatives, net of tax 169 — — 169 Amounts reclassified to earnings of cash flow hedges, net of tax 77 — — 77 Gain (loss) recognized on other, net of tax — 2 — 2 Amounts attributable to noncontrolling interests (80) (2) (3) (85) Balance at September 30, 2021 $ 97 $ (30) $ (820) $ (753) |
Derivative Instruments
Derivative Instruments | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments Disclosures about Derivative Instruments and Hedging Activities We enter into derivative instruments for risk management purposes, including derivatives designated as cash flow hedges, derivatives designated as net investment hedges and those utilized as economic hedges. We use derivatives to manage our exposure to fluctuations in interest rates and currency exchange rates. Interest Rate Swaps At September 30, 2021, we had outstanding receive-variable, pay-fixed interest rate swaps with a total notional value of $3,500 million to hedge the variability in the interest payments on a portion of our senior secured term loan facilities (the “Term Loan Facilities”), including any subsequent refinancing or replacement of the Term Loan Facilities, beginning August 31, 2021 through the termination date of October 31, 2028. Additionally, at September 30, 2021, we also had outstanding receive-variable, pay-fixed interest rate swaps with a total notional value of $500 million to hedge the variability in the interest payments on a portion of our Term Loan Facilities effective September 30, 2019 through the termination date of September 30, 2026. At inception, all of these interest rate swaps were designated as cash flow hedges for hedge accounting. The unrealized changes in market value are recorded in AOCI and reclassified into interest expense during the period in which the hedged forecasted transaction affects earnings. During 2021, we extended the maturity of our $3,500 million receive-variable, pay-fixed interest rate swaps. The extension of the term resulted in a de-designation and re-designation of the interest rate swaps and the swaps continue to be accounted for as a cash flow hedge for hedge accounting. In connection with the de-designation, we recognized a net unrealized loss of $143 million in AOCI and this amount gets reclassified into Interest expense, net as the original forecasted transaction affects earnings. The amount of pre-tax losses in connection with this net unrealized loss in AOCI as of September 30, 2021 that we expect to be reclassified into interest expense within the next 12 months is $28 million. We had previously extended the term of our $3,500 million receive-variable, pay-fixed interest rate swaps in 2019 to align the maturity date of the interest rate swaps with the new maturity date of our Term Loan B. The extension of the term resulted in a de-designation and re-designation of the interest rate swaps and the swaps continue to be accounted for as a cash flow hedge for hedge accounting. In connection with the de-designation, we recognized a net unrealized loss of $213 million in AOCI and this amount gets reclassified into Interest expense, net as the original forecasted transaction affects earnings. The amount of pre-tax losses in connection with this net unrealized loss in AOCI as of September 30, 2021 that we expect to be reclassified into interest expense within the next 12 months is $50 million. Cross-Currency Rate Swaps To protect the value of our investments in our foreign operations against adverse changes in foreign currency exchange rates, we hedge a portion of our net investment in one or more of our foreign subsidiaries by using cross-currency rate swaps. At September 30, 2021, we had outstanding cross-currency rate swap contracts between the Canadian dollar and U.S. dollar and the Euro and U.S. dollar that have been designated as net investment hedges of a portion of our equity in foreign operations in those currencies. The component of the gains and losses on our net investment in these designated foreign operations driven by changes in foreign exchange rates are economically partly offset by movements in the fair value of our cross-currency swap contracts. The fair value of the swaps is calculated each period with changes in fair value reported in AOCI, net of tax. Such amounts will remain in AOCI until the complete or substantially complete liquidation of our investment in the underlying foreign operations. At September 30, 2021, we had outstanding fixed-to-fixed cross-currency rate swaps to partially hedge the net investment in our Canadian subsidiaries. At inception, these cross-currency rate swaps were designated as a hedge and are accounted for as net investment hedges. These swaps are contracts to exchange quarterly fixed-rate interest payments we make on the Canadian dollar notional amount of C$6,754 million for quarterly fixed-rate interest payments we receive on the U.S. dollar notional amount of $5,000 million through the maturity date of June 30, 2023. At September 30, 2021, we had outstanding cross-currency rate swaps in which we pay quarterly fixed-rate interest payments on the Euro notional value of €1,108 million and receive quarterly fixed-rate interest payments on the U.S. dollar notional value of $1,200 million. At inception, these cross-currency rate swaps were designated as a hedge and are accounted for as a net investment hedge. During 2018, we extended the term of the swaps from March 31, 2021 to the maturity date of February 17, 2024. The extension of the term resulted in a re-designation of the hedge and the swaps continue to be accounted for as a net investment hedge. Additionally, at September 30, 2021, we also had outstanding cross-currency rate swaps in which we receive quarterly fixed-rate interest payments on the U.S. dollar notional value of $400 million, entered during 2018, and $500 million, entered during 2019, through the maturity date of February 17, 2024. At inception, these cross-currency rate swaps were designated as a hedge and are accounted for as a net investment hedge. The fixed-to-fixed cross-currency rate swaps hedging Canadian dollar and Euro net investments utilized the forward method of effectiveness assessment prior to March 15, 2018. On March 15, 2018, we de-designated and subsequently re-designated the outstanding fixed to fixed cross-currency rate swaps to prospectively use the spot method of hedge effectiveness assessment. Additionally, as a result of adopting new hedge accounting guidance during 2018, we elected to exclude the interest component (the “Excluded Component”) from the accounting hedge without affecting net investment hedge accounting and elected to amortize the Excluded Component over the life of the derivative instrument. The amortization of the Excluded Component is recognized in Interest expense, net in the condensed consolidated statement of operations. The change in fair value that is not related to the Excluded Component is recorded in AOCI and will be reclassified to earnings when the foreign subsidiaries are sold or substantially liquidated. Foreign Currency Exchange Contracts We use foreign exchange derivative instruments to manage the impact of foreign exchange fluctuations on U.S. dollar purchases and payments, such as coffee purchases made by our Canadian Tim Hortons operations. At September 30, 2021, we had outstanding forward currency contracts to manage this risk in which we sell Canadian dollars and buy U.S. dollars with a notional value of $148 million with maturities to November 2022. We have designated these instruments as cash flow hedges, and as such, the unrealized changes in market value of effective hedges are recorded in AOCI and are reclassified into earnings during the period in which the hedged forecasted transaction affects earnings. Credit Risk By entering into derivative contracts, we are exposed to counterparty credit risk. Counterparty credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is in an asset position, the counterparty has a liability to us, which creates credit risk for us. We attempt to minimize this risk by selecting counterparties with investment grade credit ratings and regularly monitoring our market position with each counterparty. Credit-Risk Related Contingent Features Our derivative instruments do not contain any credit-risk related contingent features. Quantitative Disclosures about Derivative Instruments and Fair Value Measurements The following tables present the required quantitative disclosures for our derivative instruments, including their estimated fair values (all estimated using Level 2 inputs) and their location on our condensed consolidated balance sheets (in millions): Gain or (Loss) Recognized in Other Comprehensive Income (Loss) Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Derivatives designated as cash flow hedges (1) Interest rate swaps $ 15 $ (22) $ 100 $ (370) Forward-currency contracts $ 2 $ (2) $ — $ 3 Derivatives designated as net investment hedges Cross-currency rate swaps $ 174 $ (238) $ 91 $ 51 (1) We did not exclude any components from the cash flow hedge relationships presented in this table. Location of Gain or (Loss) Reclassified from AOCI into Earnings Gain or (Loss) Reclassified from Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Derivatives designated as cash flow hedges Interest rate swaps Interest expense, net $ (31) $ (30) $ (92) $ (71) Forward-currency contracts Cost of sales $ (2) $ — $ (6) $ 2 Location of Gain or (Loss) Recognized in Earnings Gain or (Loss) Recognized in Earnings Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Derivatives designated as net investment hedges Cross-currency rate swaps Interest expense, net $ 11 $ 15 $ 34 $ 56 Fair Value as of September 30, December 31, 2020 Balance Sheet Location Assets: Derivatives designated as cash flow hedges Foreign currency $ 2 $ — Prepaids and other current assets Derivatives designated as net investment hedges Foreign currency 16 — Other assets, net Total assets at fair value $ 18 $ — Liabilities: Derivatives designated as cash flow hedges Interest rate $ 265 $ 430 Other liabilities, net Foreign currency 1 5 Other accrued liabilities Derivatives designated as net investment hedges Foreign currency 353 434 Other liabilities, net Total liabilities at fair value $ 619 $ 869 |
Other Operating Expenses (Incom
Other Operating Expenses (Income), net | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Other Operating Expenses (Income), net | Other Operating Expenses (Income), net Other operating expenses (income), net consist of the following (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Net losses (gains) on disposal of assets, restaurant closures, and refranchisings $ 2 $ 4 $ 1 $ 2 Litigation settlements (gains) and reserves, net 4 4 7 5 Net losses (gains) on foreign exchange (23) 44 (58) 54 Other, net 1 2 — (2) Other operating expenses (income), net $ (16) $ 54 $ (50) $ 59 Net losses (gains) on disposal of assets, restaurant closures, and refranchisings represent sales of properties and other costs related to restaurant closures and refranchisings. Gains and losses recognized in the current period may reflect certain costs related to closures and refranchisings that occurred in previous periods. Net losses (gains) on foreign exchange is primarily related to revaluation of foreign denominated assets and liabilities. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation From time to time, we are involved in legal proceedings arising in the ordinary course of business relating to matters including, but not limited to, disputes with franchisees, suppliers, employees and customers, as well as disputes over our intellectual property. On October 5, 2018, a class action complaint was filed against Burger King Worldwide, Inc. (“BKW”) and Burger King Corporation (“BKC”) in the U.S. District Court for the Southern District of Florida by Jarvis Arrington, individually and on behalf of all others similarly situated. On October 18, 2018, a second class action complaint was filed against RBI, BKW and BKC in the U.S. District Court for the Southern District of Florida by Monique Michel, individually and on behalf of all others similarly situated. On October 31, 2018, a third class action complaint was filed against BKC and BKW in the U.S. District Court for the Southern District of Florida by Geneva Blanchard and Tiffany Miller, individually and on behalf of all others similarly situated. On November 2, 2018, a fourth class action complaint was filed against RBI, BKW and BKC in the U.S. District Court for the Southern District of Florida by Sandra Muster, individually and on behalf of all others similarly situated. These complaints have been consolidated and allege that the defendants violated Section 1 of the Sherman Act by incorporating an employee no-solicitation and no-hiring clause in the standard form franchise agreement all Burger King franchisees are required to sign. Each plaintiff seeks injunctive relief and damages for himself or herself and other members of the class. On March 24, 2020, the Court granted BKC’s motion to dismiss for failure to state a claim and on April 20, 2020 the plaintiffs filed a motion for leave to amend their complaint. On April 27, 2020, BKC filed a motion opposing the motion for leave to amend. The court denied the plaintiffs motion for leave to amend their complaint in August 2020 and the plaintiffs appealed this ruling. Oral arguments for the appeal were heard in September 2021 and the parties await a ruling on the appeal. While we currently believe these claims are without merit, we are unable to predict the ultimate outcome of this case or estimate the range of possible loss, if any. In July 2019, a class action complaint was filed against The TDL Group Corp. (“TDL”) in the Supreme Court of British Columbia by Samir Latifi, individually and on behalf of all others similarly situated. The complaint alleges that TDL violated the Canadian Competition Act by incorporating an employee no-solicitation and no-hiring clause in the standard form franchise agreement all Tim Hortons franchisees are required to sign. The plaintiff seeks damages and restitution, on behalf of himself and other members of the class. In February 2021, TDL filed and served an application to strike which was heard in May 2021. While we currently believe this claim is without merit, we are unable to predict the ultimate outcome of this case or estimate the range of possible loss, if any. On June 30, 2020, a class action complaint was filed against Restaurant Brands International Inc., Restaurant Brands International Limited Partnership and The TDL Group Corp. in the Quebec Superior Court by Steve Holcman, individually and on behalf of all Quebec residents who downloaded the Tim Hortons mobile application. On July 2, 2020, a Notice of Action related to a second class action complaint was filed against Restaurant Brands International Inc., in the Ontario Superior Court by Ashley Sitko and Ashley Cadeau, individually and on behalf of all Canadian residents who downloaded the Tim Hortons mobile application. On August 31, 2020, a notice of claim was filed against Restaurant Brands International Inc. in the Supreme Court of British Columbia by Wai Lam Jacky Law on behalf of all persons in Canada who downloaded the Tim Hortons mobile application or the Burger King mobile application. On September 30, 2020, a notice of action was filed against Restaurant Brands International Inc., Restaurant Brands International Limited Partnership, The TDL Group Corp., Burger King Worldwide, Inc. and Popeyes Louisiana Kitchen, Inc. in the Ontario Superior Court of Justice by William Jung on behalf of a to be determined class. All of the complaints allege that the defendants violated the plaintiff’s privacy rights, the Personal Information Protection and Electronic Documents Act, consumer protection and competition laws or app-based undertakings to users, in each case in connection with the collection of geolocation data through the Tim Hortons mobile application, and in certain cases, the Burger King and Popeyes mobile applications. Each plaintiff seeks injunctive relief and monetary damages for himself or herself and other members of the class. These cases are in preliminary stages and we intend to vigorously defend against these lawsuits, but we are unable to predict the ultimate outcome of any of these cases or estimate the range of possible loss, if any. On October 26, 2020, City of Warwick Municipal Employees Pension Fund, a purported stockholder of Restaurant Brands International Inc., individually and putatively on behalf of all other stockholders similarly situated, filed a lawsuit in the Supreme Court of the State of New York County of New York naming RBI and certain of our officers, directors and shareholders as defendants alleging violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933, as amended, in connection with certain offerings of securities by an affiliate in August and September 2019. The complaint alleges that the shelf registration statement used in connection with such offering contained certain false and/or misleading statements or omissions. The complaint seeks, among other relief, class certification of the lawsuit, unspecified compensatory damages, rescission, pre-judgement and post-judgement interest, costs and expenses. On December 18, 2020 the plaintiffs filed an amended complaint and on February 16, 2021 RBI filed a motion to dismiss the complaint. The plaintiffs filed a brief in opposition to the motion on April 19, 2021 and RBI filed a reply in May 2021. The motion to dismiss is scheduled to be heard in December 2021. We intend to vigorously defend. While we believe these claims are without merit, we are unable to predict the ultimate outcome of this case or estimate the range of possible loss, if any. On February 5, 2021, Paul J. Graney, a purported shareholder of Restaurant Brands International, individually and putatively on behalf of all other stockholders similarly situated, filed a lawsuit in the U.S. District Court for the Southern District of Florida naming RBI and certain of our current or former officers as defendants. This lawsuit alleged violations of Sections 10 and 20(a) of the Securities Exchange Act of 1934, as amended, in connection with certain statements made beginning in April 2019. On April 26, 2021, the lead plaintiff filed a stipulation voluntarily dismissing the case, which the Court so ordered on April 27, 2021. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting As stated in Note 1, Description of Business and Organization , we manage three brands. Under the Tim Hortons brand, we operate in the donut/coffee/tea category of the quick service segment of the restaurant industry. Under the Burger King brand, we operate in the fast food hamburger restaurant category of the quick service segment of the restaurant industry. Under the Popeyes brand, we operate in the chicken category of the quick service segment of the restaurant industry. Our business generates revenue from the following sources: (i) franchise and advertising revenues, consisting primarily of royalties and advertising fund contributions based on a percentage of sales reported by franchise restaurants and franchise fees paid by franchisees; (ii) property revenues from properties we lease or sublease to franchisees; and (iii) sales at restaurants owned by us (“Company restaurants”). In addition, our TH business generates revenue from sales to franchisees related to our supply chain operations, including manufacturing, procurement, warehousing and distribution, as well as sales to retailers. We manage each of our brands as an operating segment and each operating segment represents a reportable segment. The following tables present revenues, by segment and by country (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenues by operating segment: TH $ 885 $ 762 $ 2,426 $ 2,028 BK 467 433 1,333 1,168 PLK 143 142 434 414 Total revenues $ 1,495 $ 1,337 $ 4,193 $ 3,610 Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenues by country (a): Canada $ 808 $ 691 $ 2,200 $ 1,837 United States 500 499 1,493 1,392 Other 187 147 500 381 Total revenues $ 1,495 $ 1,337 $ 4,193 $ 3,610 (a) Only Canada and the United States represented 10% or more of our total revenues in each period presented. Our measure of segment income is Adjusted EBITDA. Adjusted EBITDA represents earnings (net income or loss) before interest expense, net, loss on early extinguishment of debt, income tax (benefit) expense, and depreciation and amortization, adjusted to exclude (i) the non-cash impact of share-based compensation and non-cash incentive compensation expense, (ii) (income) loss from equity method investments, net of cash distributions received from equity method investments, (iii) other operating expenses (income), net and, (iv) income/expenses from non-recurring projects and non-operating activities. For the periods referenced, this included costs incurred from professional advisory and consulting services associated with certain transformational corporate restructuring initiatives that rationalize our structure and optimize cash movements, including services related to significant tax reform legislation, regulations and related restructuring initiatives (“Corporate restructuring and tax advisory fees”). Adjusted EBITDA is used by management to measure operating performance of the business, excluding these non-cash and other specifically identified items that management believes are not relevant to management’s assessment of our operating business. A reconciliation of segment income to net income consists of the following (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Segment income: TH $ 278 $ 258 $ 738 $ 594 BK 272 245 755 605 PLK 57 58 171 164 Adjusted EBITDA 607 561 1,664 1,363 Share-based compensation and non-cash incentive compensation expense 25 19 71 63 Corporate restructuring and tax advisory fees 4 3 8 11 Impact of equity method investments (a) 11 20 22 42 Other operating expenses (income), net (16) 54 (50) 59 EBITDA 583 465 1,613 1,188 Depreciation and amortization 50 48 150 139 Income from operations 533 417 1,463 1,049 Interest expense, net 128 129 378 376 Loss on early extinguishment of debt 11 — 11 — Income tax expense 65 65 83 62 Net income $ 329 $ 223 $ 991 $ 611 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Dividends On October 5, 2021, we paid a cash dividend of $0.53 per common share to common shareholders of record on September 21, 2021. On such date, Partnership also made a distribution in respect of each Partnership exchangeable unit in the amount of $0.53 per exchangeable unit to holders of record on September 21, 2021. |
Basis of Presentation and Con_2
Basis of Presentation and Consolidation (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | We have prepared the accompanying unaudited condensed consolidated financial statements (the “Financial Statements”) in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements. Therefore, the Financial Statements should be read in conjunction with the audited consolidated financial statements contained in our Annual Report on Form 10-K filed with the SEC and Canadian securities regulatory authorities on February 23, 2021. |
Consolidation, Policy | The Financial Statements include our accounts and the accounts of entities in which we have a controlling financial interest, the usual condition of which is ownership of a majority voting interest. All material intercompany balances and transactions have been eliminated in consolidation. Investments in other affiliates that are owned 50% or less where we have significant influence are accounted for by the equity method. |
Consolidation, Variable Interest Entity | We also consider for consolidation entities in which we have certain interests, where the controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity (“VIE”), is required to be consolidated by its primary beneficiary. The primary beneficiary is the entity that possesses the power to direct the activities of the VIE that most significantly impact its economic performance and has the obligation to absorb losses or the right to receive benefits from the VIE that are significant to it. Our maximum exposure to loss resulting from involvement with VIEs is attributable to accounts and notes receivable balances, outstanding loan guarantees and future lease payments, where applicable. As our franchise and master franchise arrangements provide the franchise and master franchise entities the power to direct the activities that most significantly impact their economic performance, we do not consider ourselves the primary beneficiary of any such entity that might be a VIE. |
Use of Estimates | The preparation of consolidated financial statements in conformity with U.S. GAAP and related rules and regulations of the SEC requires our management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities. Actual results could differ from these estimates. The carrying amounts for cash and cash equivalents, accounts and notes receivable and accounts and drafts payable approximate fair value based on the short-term nature of these amounts. |
New Accounting Pronouncements | New Accounting Pronouncements Simplifying the Accounting for Income Taxes – In December 2019, the FASB issued guidance which simplifies the accounting for income taxes by removing certain exceptions and by clarifying and amending existing guidance applicable to accounting for income taxes . The amendment is effective commencing in 2021 with early adoption permitted. The adoption of this new guidance in 2021 did not have a material impact on our Financial Statements. Accounting Relief for the Transition Away from LIBOR and Certain other Reference Rates – In March 2020 and as clarified in January 2021, the FASB issued guidance which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. This amendment is effective as of March 12, 2020 through December 31, 2022. The expedients and exceptions provided by this new guidance do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationships. During the third quarter of 2021, we adopted certain of the expedients as it relates to hedge accounting as certain of our debt agreements and hedging relationships bear interest at variable rates, primarily US dollar LIBOR. The adoption of and future elections under this new guidance did not and are not expected to have a material impact on our Financial Statements. We will continue to monitor the discontinuance of LIBOR on our debt agreements and hedging relationships. Lessors—Certain Leases with Variable Lease Payments – In July 2021, the FASB issued guidance that requires lessors to classify and account for a lease with variable lease payments that do not depend on a reference index or a rate as an operating lease if (a) the lease would have been classified as a sales-type lease or a direct financing lease in accordance with lease classification criteria and (b) the lessor would have otherwise recognized a day-one loss. This amendment is effective in 2022 with early adoption permitted. This guidance may be applied either retrospectively to leases that commenced or were modified on or after the adoption of lease guidance we adopted in 2019 or prospectively to leases that commence or are modified on or after the date that this new guidance is applied. We are currently evaluating the impact but do not expect that the adoption of this new guidance will have a material impact on our Financial Statements. |
Contract Liabilities | Contract liabilities consist of deferred revenue resulting from initial and renewal franchise fees paid by franchisees, as well as upfront fees paid by master franchisees, which are generally recognized on a straight-line basis over the term of the underlying agreement. We may recognize unamortized upfront fees when a contract with a franchisee or master franchisee is modified and is accounted for as a termination of the existing contract. We classify these contract liabilities as Other liabilities, net in our condensed consolidated balance sheets |
Earnings Per Share, Basic & Diluted | Basic and diluted earnings per share is computed using the weighted average number of shares outstanding for the period. We apply the treasury stock method to determine the dilutive weighted average common shares represented by outstanding equity awards, unless the effect of their inclusion is anti-dilutive. The diluted earnings per share calculation assumes conversion of 100% of the Partnership exchangeable units under the “if converted” method. Accordingly, the numerator is also adjusted to include the earnings allocated to the holders of noncontrolling interests. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Schedule of Property Revenues | Property revenues consist primarily of lease income from operating leases and earned income on direct financing leases and sales-type leases with franchisees as follows (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Lease income - operating leases Minimum lease payments $ 113 $ 112 $ 343 $ 333 Variable lease payments 91 82 241 191 Amortization of favorable and unfavorable income lease contracts, net 1 1 3 4 Subtotal - lease income from operating leases 205 195 587 528 Earned income on direct financing and sales-type leases 1 1 4 4 Total property revenues $ 206 $ 196 $ 591 $ 532 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Change in Contract Liabilities | The following table reflects the change in contract liabilities between December 31, 2020 and September 30, 2021 (in millions): Contract Liabilities TH BK PLK Consolidated Balance at December 31, 2020 $ 62 $ 427 $ 39 $ 528 Recognized during period and included in the contract liability balance at the beginning of the year (7) (30) (2) (39) Increase, excluding amounts recognized as revenue during the period 8 24 14 46 Impact of foreign currency translation — (10) — (10) Balance at September 30, 2021 $ 63 $ 411 $ 51 $ 525 |
Schedule of Estimated Revenues Expected to be Recognized | The following table illustrates estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2021 (in millions): Contract liabilities expected to be recognized in TH BK PLK Consolidated Remainder of 2021 $ 3 $ 9 $ 1 $ 13 2022 9 34 4 47 2023 9 33 3 45 2024 8 32 3 43 2025 7 32 3 42 Thereafter 27 271 37 335 Total $ 63 $ 411 $ 51 $ 525 |
Disaggregation of Total Revenues | Total revenues consist of the following (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Sales $ 621 $ 541 $ 1,718 $ 1,450 Royalties 412 362 1,149 968 Property revenues 206 196 591 532 Franchise fees and other revenue 21 19 61 52 Advertising revenues 235 219 674 608 Total revenues $ 1,495 $ 1,337 $ 4,193 $ 3,610 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Earnings Per Share | The following table summarizes the basic and diluted earnings per share calculations (in millions, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Numerator: Net income attributable to common shareholders - basic $ 221 $ 145 $ 659 $ 395 Add: Net income attributable to noncontrolling interests 107 78 329 215 Net income available to common shareholders and noncontrolling interests - diluted $ 328 $ 223 $ 988 $ 610 Denominator: Weighted average common shares - basic 311 303 308 301 Exchange of noncontrolling interests for common shares (Note 12) 151 162 154 164 Effect of other dilutive securities 3 5 3 4 Weighted average common shares - diluted 465 470 465 469 Basic earnings per share (a) $ 0.71 $ 0.48 $ 2.14 $ 1.31 Diluted earnings per share (a) $ 0.70 $ 0.47 $ 2.12 $ 1.30 Anti-dilutive securities outstanding 5 8 5 8 (a) Earnings per share may not recalculate exactly as it is calculated based on unrounded numbers. |
Intangible Assets, net and Go_2
Intangible Assets, net and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Goodwill | Intangible assets, net and goodwill consist of the following (in millions): As of September 30, 2021 December 31, 2020 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Identifiable assets subject to amortization: Franchise agreements $ 725 $ (283) $ 442 $ 735 $ (264) $ 471 Favorable leases 106 (63) 43 117 (66) 51 Subtotal 831 (346) 485 852 (330) 522 Indefinite-lived intangible assets: Tim Hortons brand $ 6,675 $ — $ 6,675 $ 6,650 $ — $ 6,650 Burger King brand 2,137 — 2,137 2,174 — 2,174 Popeyes brand 1,355 — 1,355 1,355 — 1,355 Subtotal 10,167 — 10,167 10,179 — 10,179 Intangible assets, net $ 10,652 $ 10,701 Goodwill Tim Hortons segment $ 4,293 $ 4,279 Burger King segment 604 614 Popeyes segment 846 846 Total $ 5,743 $ 5,739 |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of Franchise and Property Revenues | Franchise and property revenues recognized from franchisees that are owned or franchised by entities in which we have an equity interest consist of the following (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Revenues from affiliates: Royalties $ 111 $ 68 $ 254 $ 171 Advertising revenues 22 14 50 38 Property revenues 8 8 24 24 Franchise fees and other revenue 4 4 12 10 Total $ 145 $ 94 $ 340 $ 243 |
Other Accrued Liabilities and_2
Other Accrued Liabilities and Other Liabilities, net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Accrued Liabilities (Current) and Other Liabilities (Non-Current), Net | Other accrued liabilities (current) and Other liabilities, net (noncurrent) consist of the following (in millions): As of September 30, December 31, Current: Dividend payable $ 244 $ 239 Interest payable 86 66 Accrued compensation and benefits 77 78 Taxes payable 164 122 Deferred income 51 42 Accrued advertising expenses 55 59 Restructuring and other provisions 17 12 Current portion of operating lease liabilities 137 137 Other 79 80 Other accrued liabilities $ 910 $ 835 Noncurrent: Taxes payable $ 553 $ 626 Contract liabilities 525 528 Derivatives liabilities 618 865 Unfavorable leases 68 81 Accrued pension 66 70 Deferred income 33 28 Other 35 38 Other liabilities, net $ 1,898 $ 2,236 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Summary of Long-Term Debt | Long-term debt consists of the following (in millions): As of September 30, December 31, Term Loan B (due November 19, 2026) $ 5,256 $ 5,297 Term Loan A (due October 7, 2024) 717 731 2017 4.25% Senior Notes (due May 15, 2024) — 775 3.875% First Lien Senior Notes (due January 15, 2028) 1,550 750 2020 5.75% Senior Notes (due April 15, 2025) 500 500 2020 3.50% Senior Notes (due February 15, 2029) 750 750 2019 4.375% Senior Notes (due January 15, 2028) 750 750 2020 4.00% Senior Notes (due October 15, 2030) 2,900 2,900 TH Facility and other 175 178 Less: unamortized deferred financing costs and deferred issue discount (138) (155) Total debt, net 12,460 12,476 Less: current maturities of debt (81) (79) Total long-term debt $ 12,379 $ 12,397 |
Summary of Fair Value Measurement | The following table presents the fair value of our variable rate term debt and senior notes, estimated using inputs based on bid and offer prices that are Level 2 inputs, and principal carrying amount (in millions): As of September 30, December 31, Fair value of our variable term debt and senior notes $ 12,391 $ 12,477 Principal carrying amount of our variable term debt and senior notes 12,423 12,453 |
Schedule of Interest Expense, Net | Interest expense, net consists of the following (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Debt (a) $ 117 $ 119 $ 345 $ 351 Finance lease obligations 5 4 15 14 Amortization of deferred financing costs and debt issuance discount 7 7 20 19 Interest income (1) (1) (2) (8) Interest expense, net $ 128 $ 129 $ 378 $ 376 (a) Amount includes $11 million and $15 million benefit during the three months ended September 30, 2021 and 2020, respectively, and $34 million and $56 million benefit during the nine months ended September 30, 2021 and 2020, respectively, related to the quarterly net settlements of our cross-currency rate swaps and amortization of the Excluded Component as defined in Note 13, Derivatives . |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Summary of Change in Components of Accumulated Other Comprehensive Income (Loss) ("AOCI") | The following table displays the changes in the components of accumulated other comprehensive income (loss) (“AOCI”) (in millions): Derivatives Pensions Foreign Currency Translation Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2020 $ (69) $ (30) $ (755) $ (854) Foreign currency translation adjustment — — (62) (62) Net change in fair value of derivatives, net of tax 169 — — 169 Amounts reclassified to earnings of cash flow hedges, net of tax 77 — — 77 Gain (loss) recognized on other, net of tax — 2 — 2 Amounts attributable to noncontrolling interests (80) (2) (3) (85) Balance at September 30, 2021 $ 97 $ (30) $ (820) $ (753) |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Quantitative Disclosures of Derivative Instruments | The following tables present the required quantitative disclosures for our derivative instruments, including their estimated fair values (all estimated using Level 2 inputs) and their location on our condensed consolidated balance sheets (in millions): Gain or (Loss) Recognized in Other Comprehensive Income (Loss) Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Derivatives designated as cash flow hedges (1) Interest rate swaps $ 15 $ (22) $ 100 $ (370) Forward-currency contracts $ 2 $ (2) $ — $ 3 Derivatives designated as net investment hedges Cross-currency rate swaps $ 174 $ (238) $ 91 $ 51 (1) We did not exclude any components from the cash flow hedge relationships presented in this table. Location of Gain or (Loss) Reclassified from AOCI into Earnings Gain or (Loss) Reclassified from Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Derivatives designated as cash flow hedges Interest rate swaps Interest expense, net $ (31) $ (30) $ (92) $ (71) Forward-currency contracts Cost of sales $ (2) $ — $ (6) $ 2 Location of Gain or (Loss) Recognized in Earnings Gain or (Loss) Recognized in Earnings Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Derivatives designated as net investment hedges Cross-currency rate swaps Interest expense, net $ 11 $ 15 $ 34 $ 56 |
Summary of Fair Value Measurements | Fair Value as of September 30, December 31, 2020 Balance Sheet Location Assets: Derivatives designated as cash flow hedges Foreign currency $ 2 $ — Prepaids and other current assets Derivatives designated as net investment hedges Foreign currency 16 — Other assets, net Total assets at fair value $ 18 $ — Liabilities: Derivatives designated as cash flow hedges Interest rate $ 265 $ 430 Other liabilities, net Foreign currency 1 5 Other accrued liabilities Derivatives designated as net investment hedges Foreign currency 353 434 Other liabilities, net Total liabilities at fair value $ 619 $ 869 |
Other Operating Expenses (Inc_2
Other Operating Expenses (Income), net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Other Operating Expenses (Income), net | Other operating expenses (income), net consist of the following (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Net losses (gains) on disposal of assets, restaurant closures, and refranchisings $ 2 $ 4 $ 1 $ 2 Litigation settlements (gains) and reserves, net 4 4 7 5 Net losses (gains) on foreign exchange (23) 44 (58) 54 Other, net 1 2 — (2) Other operating expenses (income), net $ (16) $ 54 $ (50) $ 59 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Revenues by Operating Segment and Country | The following tables present revenues, by segment and by country (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenues by operating segment: TH $ 885 $ 762 $ 2,426 $ 2,028 BK 467 433 1,333 1,168 PLK 143 142 434 414 Total revenues $ 1,495 $ 1,337 $ 4,193 $ 3,610 Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenues by country (a): Canada $ 808 $ 691 $ 2,200 $ 1,837 United States 500 499 1,493 1,392 Other 187 147 500 381 Total revenues $ 1,495 $ 1,337 $ 4,193 $ 3,610 (a) Only Canada and the United States represented 10% or more of our total revenues in each period presented. |
Reconciliation of Segment Income to Net Income (Loss) | A reconciliation of segment income to net income consists of the following (in millions): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Segment income: TH $ 278 $ 258 $ 738 $ 594 BK 272 245 755 605 PLK 57 58 171 164 Adjusted EBITDA 607 561 1,664 1,363 Share-based compensation and non-cash incentive compensation expense 25 19 71 63 Corporate restructuring and tax advisory fees 4 3 8 11 Impact of equity method investments (a) 11 20 22 42 Other operating expenses (income), net (16) 54 (50) 59 EBITDA 583 465 1,613 1,188 Depreciation and amortization 50 48 150 139 Income from operations 533 417 1,463 1,049 Interest expense, net 128 129 378 376 Loss on early extinguishment of debt 11 — 11 — Income tax expense 65 65 83 62 Net income $ 329 $ 223 $ 991 $ 611 |
Description of Business and O_2
Description of Business and Organization - Additional Information (Details) | Sep. 30, 2021countryrestaurant |
Basis Of Presentation [Line Items] | |
Number of restaurants in operation | 27,667 |
Number of countries in which company and franchise restaurants operated (more than) | country | 100 |
Percentage of franchised Tim Hortons, Burger King, and Popeyes restaurants | 100.00% |
TH | |
Basis Of Presentation [Line Items] | |
Number of restaurants in operation | 5,137 |
BK | |
Basis Of Presentation [Line Items] | |
Number of restaurants in operation | 18,923 |
PLK | |
Basis Of Presentation [Line Items] | |
Number of restaurants in operation | 3,607 |
Basis of Presentation and Con_3
Basis of Presentation and Consolidation - Additional Information (Details) - restaurant | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Restaurant VIEs | ||
Summary Of Accounting Policies [Line Items] | ||
Number of consolidated restaurants | 49 | 38 |
Leases - Property revenues (Det
Leases - Property revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Lease income - operating leases | ||||
Minimum lease payments | $ 113 | $ 112 | $ 343 | $ 333 |
Variable lease payments | 91 | 82 | 241 | 191 |
Amortization of favorable and unfavorable income lease contracts, net | 1 | 1 | 3 | 4 |
Subtotal - lease income from operating leases | 205 | 195 | 587 | 528 |
Earned income on direct financing and sales-type leases | 1 | 1 | 4 | 4 |
Total property revenues | $ 206 | $ 196 | $ 591 | $ 532 |
Revenue Recognition - Change in
Revenue Recognition - Change in contract liabilities (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Contract Liabilities | |
Beginning balance | $ 528 |
Recognized during period and included in the contract liability balance at the beginning of the year | (39) |
Increase, excluding amounts recognized as revenue during the period | 46 |
Impact of foreign currency translation | (10) |
Ending balance | 525 |
TH | |
Contract Liabilities | |
Beginning balance | 62 |
Recognized during period and included in the contract liability balance at the beginning of the year | (7) |
Increase, excluding amounts recognized as revenue during the period | 8 |
Impact of foreign currency translation | 0 |
Ending balance | 63 |
BK | |
Contract Liabilities | |
Beginning balance | 427 |
Recognized during period and included in the contract liability balance at the beginning of the year | (30) |
Increase, excluding amounts recognized as revenue during the period | 24 |
Impact of foreign currency translation | (10) |
Ending balance | 411 |
PLK | |
Contract Liabilities | |
Beginning balance | 39 |
Recognized during period and included in the contract liability balance at the beginning of the year | (2) |
Increase, excluding amounts recognized as revenue during the period | 14 |
Impact of foreign currency translation | 0 |
Ending balance | $ 51 |
Revenue Recognition - Estimated
Revenue Recognition - Estimated revenue recognition (Details) $ in Millions | Sep. 30, 2021USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 525 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 3 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 13 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 47 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 45 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 43 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 42 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 335 |
TH | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 63 |
TH | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 3 |
TH | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 9 |
TH | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 9 |
TH | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 8 |
TH | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 7 |
TH | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 27 |
BK | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 411 |
BK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 9 |
BK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 34 |
BK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 33 |
BK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 32 |
BK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 32 |
BK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 271 |
PLK | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 51 |
PLK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 1 |
PLK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 4 |
PLK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 3 |
PLK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 3 |
PLK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | 3 |
PLK | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Contract liabilities expected to be recognized in | $ 37 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of total revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||||
Property revenues | $ 206 | $ 196 | $ 591 | $ 532 |
Total revenues | 1,495 | 1,337 | 4,193 | 3,610 |
Sales | ||||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||||
Sales | 621 | 541 | 1,718 | 1,450 |
Royalties | ||||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||||
Sales | 412 | 362 | 1,149 | 968 |
Franchise fees and other revenue | ||||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||||
Sales | 21 | 19 | 61 | 52 |
Advertising revenues | ||||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||||
Sales | $ 235 | $ 219 | $ 674 | $ 608 |
Earnings per Share - Basic and
Earnings per Share - Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Numerator: | ||||
Net income attributable to common shareholders - basic | $ 221 | $ 145 | $ 659 | $ 395 |
Add: Net income attributable to noncontrolling interests | 107 | 78 | 329 | 215 |
Net income available to common shareholders and noncontrolling interests - diluted | $ 328 | $ 223 | $ 988 | $ 610 |
Denominator: | ||||
Weighted average common shares - basic (shares) | 311 | 303 | 308 | 301 |
Exchange of noncontrolling interests for common shares (in shares) | 151 | 162 | 154 | 164 |
Effect of other dilutive securities (in shares) | 3 | 5 | 3 | 4 |
Weighted average common shares - diluted (in shares) | 465 | 470 | 465 | 469 |
Basic earnings per share (in usd per share) | $ 0.71 | $ 0.48 | $ 2.14 | $ 1.31 |
Diluted earnings per share (in usd per share) | $ 0.70 | $ 0.47 | $ 2.12 | $ 1.30 |
Anti-dilutive securities outstanding (in shares) | 5 | 8 | 5 | 8 |
Intangible Assets, net and Go_3
Intangible Assets, net and Goodwill - Schedule of Intangible Assets, Net and Goodwill (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 831 | $ 852 |
Accumulated Amortization | (346) | (330) |
Net | 485 | 522 |
Indefinite-lived Intangible Assets [Line Items] | ||
Intangible assets, net | 10,652 | 10,701 |
Goodwill [Line Items] | ||
Goodwill | 5,743 | 5,739 |
Tim Hortons brand | ||
Goodwill [Line Items] | ||
Goodwill | 4,293 | 4,279 |
Burger King brand | ||
Goodwill [Line Items] | ||
Goodwill | 604 | 614 |
Popeyes brand | ||
Goodwill [Line Items] | ||
Goodwill | 846 | 846 |
Trade Names | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets: | 10,167 | 10,179 |
Trade Names | Tim Hortons brand | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets: | 6,675 | 6,650 |
Trade Names | Burger King brand | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets: | 2,137 | 2,174 |
Trade Names | Popeyes brand | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets: | 1,355 | 1,355 |
Franchise agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 725 | 735 |
Accumulated Amortization | (283) | (264) |
Net | 442 | 471 |
Favorable leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 106 | 117 |
Accumulated Amortization | (63) | (66) |
Net | $ 43 | $ 51 |
Intangible Assets, net and Go_4
Intangible Assets, net and Goodwill - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense on intangible assets | $ 10 | $ 11 | $ 31 | $ 33 |
Equity Method Investments - Add
Equity Method Investments - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | |||||
Equity method investments | $ 199 | $ 199 | $ 205 | ||
Equity Method Investee | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Accounts receivable from equity method investments | 39 | 39 | $ 52 | ||
Wendy's Company TIMWEN Partnership | Tim Hortons brand | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Cash distributions | 3 | $ 2 | 9 | $ 6 | |
Rent expense | 5 | $ 4 | 13 | $ 11 | |
Carrols Restaurant Group, Inc. | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Quoted market price | $ 34 | $ 34 | |||
BK Brasil | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 9.40% | 9.40% | |||
Quoted market price | $ 39 | $ 39 | |||
Canada | Wendy's Company TIMWEN Partnership | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 50.00% | 50.00% | |||
United States | Carrols Restaurant Group, Inc. | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 15.40% | 15.40% |
Equity Method Investments - Sum
Equity Method Investments - Summary of Franchise and Property Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenues from affiliates: | ||||
Property revenues | $ 206 | $ 196 | $ 591 | $ 532 |
Total revenues | 1,495 | 1,337 | 4,193 | 3,610 |
Affiliates | ||||
Revenues from affiliates: | ||||
Total revenues | 145 | 94 | 340 | 243 |
Royalties | ||||
Revenues from affiliates: | ||||
Revenues | 412 | 362 | 1,149 | 968 |
Royalties | Affiliates | ||||
Revenues from affiliates: | ||||
Revenues | 111 | 68 | 254 | 171 |
Advertising revenues | ||||
Revenues from affiliates: | ||||
Revenues | 235 | 219 | 674 | 608 |
Advertising revenues | Affiliates | ||||
Revenues from affiliates: | ||||
Revenues | 22 | 14 | 50 | 38 |
Property Revenue | Affiliates | ||||
Revenues from affiliates: | ||||
Property revenues | 8 | 8 | 24 | 24 |
Franchise fees and other revenue | ||||
Revenues from affiliates: | ||||
Revenues | 21 | 19 | 61 | 52 |
Franchise fees and other revenue | Affiliates | ||||
Revenues from affiliates: | ||||
Revenues | $ 4 | $ 4 | $ 12 | $ 10 |
Other Accrued Liabilities and_3
Other Accrued Liabilities and Other Liabilities, net - Schedule of Other Accrued Liabilities (Current) and Other Liabilities (Noncurrent), Net (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Current: | ||
Dividend payable | $ 244 | $ 239 |
Interest payable | 86 | 66 |
Accrued compensation and benefits | 77 | 78 |
Taxes payable | 164 | 122 |
Deferred income | 51 | 42 |
Accrued advertising expenses | 55 | 59 |
Restructuring and other provisions | 17 | 12 |
Current portion of operating lease liabilities | 137 | 137 |
Other | 79 | 80 |
Other accrued liabilities | 910 | 835 |
Noncurrent: | ||
Taxes payable | 553 | 626 |
Contract liabilities | 525 | 528 |
Derivatives liabilities | 618 | 865 |
Unfavorable leases | 68 | 81 |
Accrued pension | 66 | 70 |
Deferred income | 33 | 28 |
Other | 35 | 38 |
Other liabilities, net | $ 1,898 | $ 2,236 |
Long-Term Debt - Summary of Lon
Long-Term Debt - Summary of Long-Term Debt (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Other | $ 175 | $ 178 |
Less: unamortized deferred financing costs and deferred issue discount | (138) | (155) |
Total debt, net | 12,460 | 12,476 |
Less: current maturities of debt | (81) | (79) |
Total long-term debt | 12,379 | 12,397 |
Term Loan B (due November 19, 2026) | ||
Debt Instrument [Line Items] | ||
Term loan facility | 5,256 | 5,297 |
Term Loan A (due October 7, 2024) | ||
Debt Instrument [Line Items] | ||
Term loan facility | $ 717 | 731 |
2017 4.25% Senior Notes (due May 15, 2024) | ||
Debt Instrument [Line Items] | ||
Stated interest rate (as a percent) | 4.25% | |
Senior notes | $ 0 | 775 |
3.875% First Lien Senior Notes (due January 15, 2028) | ||
Debt Instrument [Line Items] | ||
Stated interest rate (as a percent) | 3.875% | |
Senior notes | $ 1,550 | 750 |
2020 5.75% Senior Notes (due April 15, 2025) | ||
Debt Instrument [Line Items] | ||
Stated interest rate (as a percent) | 5.75% | |
Senior notes | $ 500 | 500 |
2020 3.50% Senior Notes (due February 15, 2029) | ||
Debt Instrument [Line Items] | ||
Stated interest rate (as a percent) | 3.50% | |
Senior notes | $ 750 | 750 |
2019 4.375% Senior Notes (due January 15, 2028) | ||
Debt Instrument [Line Items] | ||
Stated interest rate (as a percent) | 4.375% | |
Senior notes | $ 750 | 750 |
2020 4.00% Senior Notes (due October 15, 2030) | ||
Debt Instrument [Line Items] | ||
Stated interest rate (as a percent) | 4.00% | |
Senior notes | $ 2,900 | $ 2,900 |
Long-Term Debt - Revolving Cred
Long-Term Debt - Revolving Credit Facility - Revolving Credit Facility (Details) - Line of Credit | Sep. 30, 2021USD ($) |
Revolving Credit Facility | |
Line of Credit Facility [Line Items] | |
Letters of credit issued against credit facility | $ 0 |
Remaining borrowing capacity | 998,000,000 |
Letter of Credit | |
Line of Credit Facility [Line Items] | |
Letters of credit issued against credit facility | 2,000,000 |
Letter of credit sublimit as part of revolving credit facility | $ 125,000,000 |
Long-Term Debt - TH Facility (D
Long-Term Debt - TH Facility (Details) $ in Millions | 9 Months Ended | ||
Sep. 30, 2021USD ($)subsidiary | Sep. 30, 2021CAD ($)subsidiary | Dec. 31, 2020USD ($) | |
Line of Credit Facility [Line Items] | |||
Amount outstanding | $ 12,460 | $ 12,476 | |
TH Facility | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Number of subsidiaries | subsidiary | 1 | 1 | |
Maximum borrowing capacity | $ 225,000,000 | ||
Number of guaranteed subsidiaries | subsidiary | 4 | 4 | |
Amount outstanding | $ 217,000,000 | ||
Weighted average interest rate | 1.83% | 1.83% | |
TH Facility | Canadian Bankers' Acceptance Rate | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 1.40% | ||
TH Facility | Prime Rate | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.40% |
Long-Term Debt - First Lien Sen
Long-Term Debt - First Lien Senior Notes (Details) | Jul. 06, 2021USD ($)subsidiary | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 24, 2019USD ($) |
Debt Instrument [Line Items] | ||||||
Loss on early extinguishment of debt | $ 11,000,000 | $ 0 | $ 11,000,000 | $ 0 | ||
3.875% First Lien Senior Notes (due January 15, 2028) | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate (as a percent) | 3.875% | 3.875% | ||||
2017 4.25% Senior Notes (due July 15, 2021) | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate (as a percent) | 4.25% | |||||
Principal amount redeemed | $ 775,000,000 | |||||
Capitalized debt issuance costs | 7,000,000 | |||||
Loss on early extinguishment of debt | $ 11,000,000 | |||||
Senior Notes | 3.875% First Lien Senior Notes (due January 15, 2028) | ||||||
Debt Instrument [Line Items] | ||||||
Number of subsidiaries | subsidiary | 2 | |||||
Debt instrument, face amount | $ 800,000,000 | $ 750,000,000 | ||||
Stated interest rate (as a percent) | 3.875% | 3.875% | ||||
Principal payments | $ 0 | |||||
Redemption price percentage | 100.25% |
Long-Term Debt - Summary of Fai
Long-Term Debt - Summary of Fair Value Measurement (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
Fair value of our variable term debt and senior notes | $ 12,391 | $ 12,477 |
Principal carrying amount of our variable term debt and senior notes | $ 12,423 | $ 12,453 |
Long-Term Debt - Schedule of In
Long-Term Debt - Schedule of Interest Expense, Net and Other (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Debt Disclosure [Abstract] | ||||
Debt | $ 117 | $ 119 | $ 345 | $ 351 |
Finance lease obligations | 5 | 4 | 15 | 14 |
Amortization of deferred financing costs and debt issuance discount | 7 | 7 | 20 | 19 |
Interest income | (1) | (1) | (2) | (8) |
Interest expense, net | 128 | 129 | 378 | 376 |
Cross-currency rate swaps | Derivatives designated as net investment hedges | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Gain (loss) reclassified to earnings, net investment hedge | $ 11 | $ 15 | $ 34 | $ 56 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 16.70% | 22.60% | 7.70% | 9.20% |
Expiring statutes of limitation for certain prior tax years | $ 87 | |||
Effective tax rate, period decrease | 8.10% | 9.50% | ||
Deferred tax asset, period increase (decrease) | $ 64 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Jul. 28, 2021 | |
Stockholders Equity [Line Items] | ||||
Number of shares authorized to be repurchased (in shares up to) | 1,000,000,000 | |||
Number of shares repurchased and cancelled | 2,843,562 | 2,843,562 | ||
Amount of shares repurchased and cancelled | $ 182 | $ 182 | ||
Partnerships Exchangeable Units | ||||
Stockholders Equity [Line Items] | ||||
Exchange of partnership exchangeable units for RBI common shares (in shares) | 9,843,402 | |||
Restaurant Brands International Limited Partnership | ||||
Stockholders Equity [Line Items] | ||||
Partnership exchangeable units economic interest | 31.60% | 33.70% | ||
Partnership exchangeable units economic interest (in shares) | 145,269,936 | 145,269,936 | 155,113,338 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Change in Components of AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balances | $ 4,259 | $ 3,852 | $ 3,721 | $ 4,259 |
Foreign currency translation adjustment | (257) | 239 | (62) | (170) |
Net change in fair value of derivatives, net of tax | 169 | |||
Amounts reclassified to earnings of cash flow hedges, net of tax | 24 | 22 | 77 | 51 |
Gain (loss) recognized on other, net of tax | 0 | 0 | 2 | 0 |
Amounts attributable to noncontrolling interests | (85) | |||
Ending balances | 4,108 | 3,915 | 4,108 | 3,915 |
Derivatives | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balances | (69) | |||
Net change in fair value of derivatives, net of tax | 169 | |||
Amounts reclassified to earnings of cash flow hedges, net of tax | 77 | |||
Amounts attributable to noncontrolling interests | (80) | |||
Ending balances | 97 | 97 | ||
Pensions | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balances | (30) | |||
Gain (loss) recognized on other, net of tax | 2 | |||
Amounts attributable to noncontrolling interests | (2) | |||
Ending balances | (30) | (30) | ||
Foreign Currency Translation | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balances | (755) | |||
Foreign currency translation adjustment | (62) | |||
Amounts attributable to noncontrolling interests | (3) | |||
Ending balances | (820) | (820) | ||
Accumulated Other Comprehensive Income (Loss) | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balances | (679) | (1,025) | (854) | (763) |
Ending balances | $ (753) | $ (997) | $ (753) | $ (997) |
Derivative Instruments - Additi
Derivative Instruments - Additional Information (Details) € in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2021CAD ($) | Sep. 30, 2021EUR (€) | Dec. 31, 2018USD ($) | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Net unrealized loss recognized in AOCI | $ (13,000,000) | $ 17,000,000 | $ (68,000,000) | $ 268,000,000 | ||||
Interest Rate Swaps - Beginning October 31. 2019 | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional value | 3,500,000,000 | 3,500,000,000 | ||||||
Interest Rate Swaps - Beginning September 30, 2019 | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional value | 500,000,000 | 500,000,000 | ||||||
Interest rate swaps | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional value | 3,500,000,000 | 3,500,000,000 | $ 3,500,000,000 | |||||
Net unrealized loss recognized in AOCI | 143,000,000 | 213,000,000 | ||||||
Loss reclassified from AOCI to income | 28,000,000 | 50,000,000 | ||||||
Cross currency interest rate contract | Fixed income interest rate | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional value | 5,000,000,000 | 5,000,000,000 | $ 6,754 | |||||
Cross currency interest rate contract | Fixed income interest rate | Derivatives designated as net investment hedges | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional value | $ 500,000,000 | $ 400,000,000 | ||||||
Cross currency interest rate contract | Fixed income interest rate | Hedge Funds | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional value | 1,200,000,000 | 1,200,000,000 | € 1,108 | |||||
Foreign Exchange Contract | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional value | $ 148,000,000 | $ 148,000,000 |
Derivative Instruments - Quanti
Derivative Instruments - Quantitative Disclosures of Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Derivatives designated as cash flow hedges | Interest rate swaps | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain or (Loss) Recognized in Other Comprehensive Income (Loss) | $ 15 | $ (22) | $ 100 | $ (370) |
Derivatives designated as cash flow hedges | Interest rate swaps | Interest expense, net | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain or (Loss) Reclassified from AOCI into Earnings | (31) | (30) | (92) | (71) |
Derivatives designated as cash flow hedges | Forward-currency contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain or (Loss) Recognized in Other Comprehensive Income (Loss) | 2 | (2) | 0 | 3 |
Derivatives designated as cash flow hedges | Forward-currency contracts | Cost of sales | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain or (Loss) Reclassified from AOCI into Earnings | (2) | 0 | (6) | 2 |
Derivatives designated as net investment hedges | Cross-currency rate swaps | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain or (Loss) Recognized in Other Comprehensive Income (Loss) | 174 | (238) | 91 | 51 |
Gain or (Loss) Recognized in Earnings (Amount Excluded from Effectiveness Testing) | 11 | 15 | 34 | 56 |
Derivatives designated as net investment hedges | Cross-currency rate swaps | Interest expense, net | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain or (Loss) Recognized in Earnings (Amount Excluded from Effectiveness Testing) | $ 11 | $ 15 | $ 34 | $ 56 |
Derivative Instruments - Summar
Derivative Instruments - Summary of Fair Value Measurements (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Derivative [Line Items] | ||
Derivatives assets | $ 18 | $ 0 |
Derivatives liabilities | 619 | 869 |
Derivatives designated as cash flow hedges | Foreign currency | Prepaids and other current assets | ||
Derivative [Line Items] | ||
Derivatives assets | 2 | 0 |
Derivatives designated as cash flow hedges | Foreign currency | Other accrued liabilities | ||
Derivative [Line Items] | ||
Derivatives liabilities | 1 | 5 |
Derivatives designated as cash flow hedges | Interest rate | Other liabilities, net | ||
Derivative [Line Items] | ||
Derivatives liabilities | 265 | 430 |
Derivatives designated as net investment hedges | Foreign currency | Other assets, net | ||
Derivative [Line Items] | ||
Derivatives assets | 16 | 0 |
Derivatives designated as net investment hedges | Foreign currency | Other liabilities, net | ||
Derivative [Line Items] | ||
Derivatives liabilities | $ 353 | $ 434 |
Other Operating Expenses (Inc_3
Other Operating Expenses (Income), net - Other Operating Expenses (Income), Net (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Other Income and Expenses [Abstract] | ||||
Net losses (gains) on disposal of assets, restaurant closures, and refranchisings | $ 2 | $ 4 | $ 1 | $ 2 |
Litigation settlements (gains) and reserves, net | 4 | 4 | 7 | 5 |
Net losses (gains) on foreign exchange | (23) | 44 | (58) | 54 |
Other, net | 1 | 2 | 0 | (2) |
Other operating expenses (income), net | $ (16) | $ 54 | $ (50) | $ 59 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2021brand | |
Segment Reporting [Abstract] | |
Number of brands | 3 |
Segment Reporting - Revenues by
Segment Reporting - Revenues by Operating Segment and Country (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue, Major Customer [Line Items] | ||||
Total revenues | $ 1,495 | $ 1,337 | $ 4,193 | $ 3,610 |
Canada | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenues | 808 | 691 | 2,200 | 1,837 |
United States | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenues | 500 | 499 | 1,493 | 1,392 |
Other | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenues | 187 | 147 | 500 | 381 |
TH | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenues | 885 | 762 | 2,426 | 2,028 |
BK | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenues | 467 | 433 | 1,333 | 1,168 |
PLK | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenues | $ 143 | $ 142 | $ 434 | $ 414 |
Segment Reporting - Reconciliat
Segment Reporting - Reconciliation of Segment Income to Net Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||
Adjusted EBITDA | $ 607 | $ 561 | $ 1,664 | $ 1,363 | ||||
Impact of equity method investments | 7 | 18 | 12 | 36 | ||||
Other operating expenses (income), net | (16) | 54 | (50) | 59 | ||||
EBITDA | 583 | 465 | 1,613 | 1,188 | ||||
Depreciation and amortization | 50 | 48 | 150 | 139 | ||||
Income from operations | 533 | 417 | 1,463 | 1,049 | ||||
Interest expense, net | 128 | 129 | 378 | 376 | ||||
Loss on early extinguishment of debt | 11 | 0 | 11 | 0 | ||||
Income tax expense | 65 | 65 | 83 | 62 | ||||
Net income | 329 | $ 391 | $ 271 | 223 | $ 164 | $ 224 | 991 | 611 |
Unallocated Management G&A | ||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||
Share-based compensation and non-cash incentive compensation expense | 25 | 19 | 71 | 63 | ||||
Corporate restructuring and tax advisory fees | 4 | 3 | 8 | 11 | ||||
Impact of equity method investments | 11 | 20 | 22 | 42 | ||||
Other operating expenses (income), net | (16) | 54 | (50) | 59 | ||||
TH | Operating Segments | ||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||
Adjusted EBITDA | 278 | 258 | 738 | 594 | ||||
BK | Operating Segments | ||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||
Adjusted EBITDA | 272 | 245 | 755 | 605 | ||||
PLK | Operating Segments | ||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||
Adjusted EBITDA | $ 57 | $ 58 | $ 171 | $ 164 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - $ / shares | Jan. 05, 2022 | Oct. 05, 2021 | Oct. 25, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 |
Subsequent Event [Line Items] | |||||||||
Common stock, dividends declared (in usd per share) | $ 0.53 | $ 0.53 | $ 0.53 | $ 0.52 | $ 0.52 | $ 0.52 | |||
Forecast | |||||||||
Subsequent Event [Line Items] | |||||||||
Common stock, dividends paid (in usd per share) | $ 0.53 | ||||||||
Subsequent Event | |||||||||
Subsequent Event [Line Items] | |||||||||
Common stock, dividends paid (in usd per share) | $ 0.53 | ||||||||
Common stock, dividends declared (in usd per share) | $ 0.53 | ||||||||
Partnerships Exchangeable Units | Restaurant Brands International Limited Partnership | Subsequent Event | |||||||||
Subsequent Event [Line Items] | |||||||||
Distribution in respect of each Partnership exchangeable unit (in usd per share) | $ 0.53 | $ 0.53 |