Burger King earnings soar but stock falls

Burger King Holdings Inc. said Monday that its first-quarter earnings rose 23%, but shares of the world’s second-largest hamburger chain fell almost 4% as three big shareholders disclosed plans to sell about a third of their stakes.

The Miami-based fast-food company earned $49 million, or 35 cents a share, for the three months that ended Sept. 30, compared with $40 million, or 30 cents, a year earlier. Revenue increased 10% to $602 million.

Analysts were expecting profit of 33 cents a share on revenue of $597.1 million, according to a poll by Thomson Financial.

Meanwhile, the company said three private equity funds -- TPG Capital, Bain Capital Partners and the Goldman Sachs Funds -- would sell 26.5 million shares of the company’s stock, or about a third of their holdings in the company, at a proposed maximum price of $26.94 a share. The funds’ stake will be lowered from 58% to 39% after the offering is completed, according to a Securities and Exchange Commission filing.

The move seemed to have pressured shares, which fell $1.01, or 3.6%, to $26.72 on Monday.

Burger King’s strategy involves new products, aggressive marketing and a worldwide expansion that includes opening new restaurants and closing underperforming ones. Despite high fuel prices, rising food costs and the sluggish housing market, fast-food chains such as Burger King, McDonald’s Corp. and Wendy’s International Inc. have performed relatively well as consumers seek affordable options when they eat out.

“We are thriving in a challenging economic environment as consumers take advantage of our value and convenience,” Burger King Chief Executive John Chidsey said.