Jose Cil, CEO of Restaurant Brands International, speaks during an interview with CNBC on the floor at the New York Stock Exchange, November 6, 2019.
Brendan McDermid | Reuters
Restaurant Brands International is sending cash to franchisees and deferring rents as part of an effort to support its operators.
The coronavirus pandemic has put pressure on the restaurant industry as states close dining rooms and more U.S. consumers eat at home. Transactions at fast-food restaurants plummeted by 34% in the week ended March 22 compared to year ago, according to the NPD Group.
In North America, the Burger King parent is sending about $70 million in cash advances and rebates to franchisees.
“These initiatives have allowed us to unlock thousands of dollars of immediate liquidity per eligible restaurant,” CEO Jose Cil wrote an open letter on Monday.
Restaurant Brands acts as the landlord for roughly 3,700 Tim Hortons and Burger King locations in Canada and the United States. The company has temporarily converted rent to being entirely based on sales. Restaurant Brands has also deferred rent payments for up to 45 days and is working with North American landlords for further assistance.
Other restaurant franchisors, including Wendy’s and McDonald’s, are working to support franchisee liquidity. McDonald’s, for example, is giving some franchisees rent and royalty fee deferrals.
All workers at company-owned restaurants across its three brands will receive a $3 hourly bonus in April.
Burger King and Popeyes workers at company-owned restaurants will now be able to receive paid sick leave for up to 14 days if they are diagnosed with COVID-19 or have been asked to self-isolate. The company has established a support fund with franchisees to pay Tim Hortons workers in Canada if they have been affected by COVID-19.
The company is also sending 15,000 infrared thermometers to all Burger King, Popeyes and Tim Hortons restaurants to use on employees.
The company has roughly $2.5 billion in cash on hand after fully drawing down its $1 billion revolver.
Shares of Restaurant Brands closed down less than 1% on Monday. Its stock has fallen nearly 37% so far in 2020.