Tims News

[Flames9_RN 358]

Tim Hortons Inc. (TSX:THI) is not seeking to acquire a U.S. doughnut chain as part of its efforts to expand south of the border, but wouldn't rule it out "if it was attractive to acquire," CEO Paul House told shareholders at the retailer's first annual meeting Friday.

House said the company is looking first to become an established, well-known chain in one region, namely New York state, Michigan, Ohio and Maine, before it expands.

"Not that we wouldn't look at something if it was attractive to acquire, but that is not part of our strategy," House said in response to a shareholder who suggested there are strong chains in the U.S. that "may be ripe to be taken over."

But House replied that has never been part of Tim Hortons' strategy and noted the chain built up to more than 3,000 stores in Canada without a single acquisition.

"We want to be a strong regional player in the United States and we want to achieve that goal, and when we've met that goal we'll broaden our horizons," House said.

"There are difficulties, but they are opportunities, and we see them as great opportunities. That is one of the reasons we're concentrating on certain markets and not getting ambitious about a national chain or any of that."

The company's growth in the U.S. has been weaker than in Canada.

The firm posted earnings Thursday of $59.3 million for the first quarter, down from $63.6 million a year ago.

Sales at stores that have been open more than one year increased 6.3 per cent in Canada - above the company's long-term expectations - and four per cent in the U.S.

Tim Hortons' profits amounted to 31 cents a share and compared with 39 cents per share last year, due in part to a higher tax rate and a 17.8 per cent higher share count was as a result of the company's initial public offering in March 2006.

Total revenues were $424.6 million for the three months ended April 1, up 13.9 per cent from $372.8 million in the first quarter of 2006. Overall sales growth, which includes both franchised and company-operated restaurants, was 10.4 per cent.

The effective tax rate in the first quarter was 34.6 per cent, compared with 14.8 per cent in 2006.

Analyst Irene Nattel, with RBC Capital Markets, said the company is "firing on five cylinders," referring to the U.S. results which she said did not live up to expectations.

"Investors should remember, however, that the driver of Tim Hortons' earnings growth is the Canadian operations, as the U.S. remains in investment mode," Nattel wrote in a note to analysts. "For us, the real take-away from the (first quarter of 2007) results is that despite the tepid U.S. results, Tim Hortons delivered strong net income growth."

Nattel rates the company as a buy, with a target price of $41.

Meanwhile, analyst Peter Rozenberg, with UBS, set a price target of $42.

"We think Tim's is an exceptional business due to a strong brand, very profitable franchise income, high returns, strong cash flow, good same store sales and unit growth, and low risk business model," Rozenberg wrote in an investor's note, adding the company's balance sheet is solid.

"Canadian operations remain strong. However, we think that U.S. profitability will take time to meaningfully improve," Rozenberg said.

Tim Hortons opened a total of 21 restaurants in the quarter, compared with 27 in the first quarter last year. It still plans to open 500 stores in the U.S. by the end of 2008 and will contribute 60 to 80 stores to that goal this year.

It's also expanding its menu with new coffee beverages and wraps, soups and sandwiches.

In Canada, it expects to arrange electronic payments through MasterCard and a cash card by the end of 2007.

Tim Hortons, which has more than 70,000 employees in Canada and United States, began as a coffee-and-doughnut shop in 1964, with late NHL star Tim Horton as a co-founder.

On the TSX Friday, its shares closed down 51 cents at $34.99.

[MaydayDas 1]

I am too lazy to read all

[jg_am 0]

That's too bad. DD is the chain around me. In fact Krispy Kream opened up a bunch of stores and within a year or two, they were gone. Keep in mind this isn't too far from where the south, we're they're everywhere. I think it was the location more than anything but what do I know. I told my wife we should start writing to Wendy's to see if they're going to carry Tim's products in their restaurants. Then again, they screwed up the last two Frosties I've ordered so I'm sure they'd mess an iced-capp as well.

[Chica Yeyé 41]

WHAT?????????????? Lenina suffers.I wonder if there will be a Second Cup around where we move. Sniff.

p.s. Friends don't let friends go to Starbucks... he he

[Flames9_RN 358]

Never seen any Second Cups are the DC area

[Chica Yeyé 41]

Never seen any Second Cups are the DC area

Darn - wonder if they have any in Portland or Seattle (our two main possible destinations).... I also suffer about the possibility of NOT having access to LUSH cosmetics..... AAAAAAAAAAAAAAAAAA

[Flames9_RN 358]

http://www.secondcup.com/eng/index.php Does not appear so

[Chica Yeyé 41]

http://www.secondcup.com/eng/index.php Does not appear so

Ok flames, now you're just being mean.... he he he.... In any case, I can always (if we end up in Portland) run to Vancouver and get me some Second Cup Luv...... HA!

[Flames9_RN 358]

Of course u mean Vancouver Canada, and NOT vancouver Washington,lol Spent time in Vacouver Washington and Portland while in the Cdn Navy!1 Was down for the Rose festival. That was a blast!! I recall 1 night we met up with a Budweiser Rep!! Free bud all night long!!

[lynamon 0]

My fiance and I have discussed looking into opening a franchise in Cleveland, Ohio. My whole family has worked for Tim's at one point or another (my aunt used to own three stores in Hamilton). I just really wonder if it would be as successful there without the Canadian addicts!!!!

[Flames9_RN 358]

The dunkin by us does very well in the mornings!! I think it all depends on location.

[KarenCee 3]

WHAT?????????????? Lenina suffers.I wonder if there will be a Second Cup around where we move. Sniff.

p.s. Friends don't let friends go to Starbucks... he he

So true! Starbucks is better known as Charbucks. KK coffee is right up there with Charbucks too. Not sure about DD, so I just get my Tim's in the can shipped to me. *sigh* The South is *always* behind....

[Flames9_RN 358]

I dont mind starbucks, go for a venti no foam vanilla latte!! Best non-tims coffee I have ever had was in Italy on the Air Force base in Sigonella, was some good.

[Killer_Clown_2009 0]

I email Tim Horton's every once in awhile requesting that they open one up in Boston. The last email seemed more promising than the usual one:

Dear Valued Customer,

I would like to thank you for taking the time to write to us with your

location suggestion as well as for your valued patronage.

Your suggestion has been forwarded to our Real Estate Department for their

review and consideration. It is through feedback from valued customers,

such as yourself, that we are continually able to grow as a company.

If you have any further questions or comments please do not hesitate to

contact us.

Kind Regards,

Sheila

Operations Services

The TDL Group Corp

[jg_am 0]

All this talk wants me to email Tim's and suggest they sell their products(at least the coffe) through Wendy's in the States. This will get their name out there and then allow them to branch out to stand alone stores.