Tim Hortons raises price of muffins, sandwiches due to operating costs
A server pours a cup of coffee at the Tim Hortons' AGM in Toronto on Thursday, May 10, 2012. (Chris Young / THE CANADIAN PRESS)
The Canadian Press
Published Friday, August 3, 2012 2:32PM EDT
Last Updated Friday, August 3, 2012 5:16PM EDT
TORONTO -- Your morning cup of java at Tim Hortons (TSX:THI) won't cost you more, but your midday snack might.
"Due to an increase in operating costs, Tim Hortons restaurants has changed the pricing on select baked goods and lunch items this week," a spokeswoman for the company said Friday.
The coffee and doughnut chain says the price of a muffin is five cents higher, while sandwiches have gone up by about 10 cents. The price of coffee has not changed.
Higher commodity prices -- on ingredients from wheat to canola oil -- are one factor in the hikes, which will affect most locations.
The price increases come just after Maple Leaf Foods Inc. (TSX:MFI) warned this week that drought conditions will inflate food prices well into next year and maybe beyond.
The last time Tim Hortons raised its prices was in April 2011, when menu prices jumped about 4.5 per cent to cover rising costs of commodities like coffee and the wheat and sugar used in its baked goods.
Based in Oakville, Ont., Tim Hortons is Canada's biggest restaurant chain and the fourth-biggest in North America with more than 3,700 restaurants.
The company will report its second quarter earnings on Thursday. Analysts are predicting, on average, earnings of 69 cents per share on revenue of $783 million, according to Thomson Reuters.
Tim Hortons shares closed up 58 cents, or one per cent, to $53.39 Friday on the Toronto Stock Exchange.