Restaurant Brands International (QSR), the parent company of Tim Hortons, has launched a new stock buyback program that will see it repurchase $1 billion U.S. of its common shares over the next two years.
The stock repurchase program will run until September 30, 2025, according to Restaurant Brands International, which also owns Burger King, Popeyes and Firehouse Subs.
The new plan, which has been approved by the company’s board of directors, follows the expiration of Restaurant Brands earlier stock buyback program for the same amount.
The company said that under terms of the new program, it may elect to buy and cancel up to 10% of its outstanding shares.
Restaurant Brands International last year received approval from the Toronto Stock Exchange to repurchase up to 30.3 million of its own stock, equivalent to 10% of its outstanding shares.
The company recently reported strong second-quarter financial results that showed its overall sales increased 10% from a year earlier.
With stock buybacks, companies reduce their equity base, spreading profits over fewer shares. That increases the return on equity and earnings per share.
Stock buybacks also increase the percentage of ownership that investors have in a company without them having to pay additional money to buy more stock.
Restaurant Brands International’s share price has risen 23% over the last 12 months and currently trades at $95.09 on the Toronto Stock Exchange.
