Toronto Stock Exchange: BPF.UN
Franchise Sales of $221.5 million for the third quarter of 2017
increased by 2.8% versus one year ago
Highlights
- System-Wide Gross Sales1 of $286.7 million for the Period and $823.6 million YTD, representing increases of
1.8% and 1.7%, respectively, versus the same periods one year
ago.
- Franchise Sales2 from royalty pool restaurants of
$221.5 million for the Period and
$636.6 million YTD, representing
increases of 2.8% and 1.9%, respectively, versus the same periods
one year ago.
- Same Store Sales Growth of positive 0.4% for the Period and
negative 0.4% YTD.
- Distributable Cash3 per Unit increased 3.5% for the
Period and increased 0.2% YTD.
- Payout Ratio4 of 88.4% for the Period, 98.5% YTD,
and 99.2% on a trailing 12-month basis. Cash balance at the end of
the Period was $3.5 million.
- On November 9, 2017, the trustees
declared the October 2017
distribution to unitholders of 11.5
cents per Unit.
VANCOUVER, Nov. 14, 2017 /CNW/ - Boston Pizza Royalties
Income Fund (the "Fund") and Boston Pizza International Inc.
("BPI") reported financial results today for the third
quarter period from July 1, 2017 to
September 30, 2017 (the
"Period") and January 1, 2017
to September 30, 2017
("YTD"). A copy of this press release, the condensed
consolidated interim financial statements and related Management's
Discussion and Analysis ("MD&A") of the Fund and BPI are
available at www.sedar.com and www.bpincomefund.com. The Fund
will host a conference call to discuss the results on November 14, 2017 at 8:30
am Pacific Time (11:30 am Eastern
Time). The call can be accessed by dialling
1-800-319-4610 or 604-638-5340. A replay will be available until
December 14, 2017 by dialling
1-855-669-9658 or 604-674-8052 and entering the access code: 1684
followed by the # sign. The replay will also be available at
www.bpincomefund.com.
Same store sales growth ("SSSG"), a key driver of distribution
growth for unitholders of the Fund, was positive 0.4% for the
Period and negative 0.4% YTD compared with negative 0.5% and
positive 0.7%, respectively, for the same periods in 2016.
Franchise Sales, the basis upon which Royalty5 and
Distribution Income5 are paid to the Fund, exclude
revenue from the sale of liquor, beer, wine and approved national
promotions and discounts. On a Franchise Sales basis, SSSG
was positive 0.4% for the Period and negative 0.5% YTD compared
with negative 1.1% and positive 0.4%, respectively, for the same
periods in 2016. The positive SSSG for the Period was
principally due to menu re-pricing and increased online take-out
and delivery sales, partially offset by weak general economic
conditions in regions directly connected to the Canadian oil and
gas industry and the adverse impact of the Saskatchewan 6% provincial sales tax ("PST")
on restaurant purchased food. The negative SSSG YTD was principally
due to weak general economic conditions in regions directly
connected to the Canadian oil and gas industry, the adverse impact
of the Saskatchewan 6% PST on
restaurant purchased food and having one less day compared to the
same period one year ago due to 2016 being a leap year, partially offset by menu re-pricing
and increased online take-out and delivery sales. Franchise Sales
of restaurants in the Fund's Royalty Pool were $221.5 million for the Period and
$636.6 million YTD compared to
$215.6 million and $624.5 million, respectively for the same periods
in 2016. The $5.9 million
increase in Franchise Sales for the Period was primarily due to the
additional Franchise Sales from 11 Net New Restaurants added to the
Royalty Pool on January 1, 2017 and positive SSSG. The
$12.1 million increase in Franchise
Sales YTD was primarily due to the additional Franchise Sales from
11 Net New Restaurants added to the Royalty Pool on January 1,
2017, partially offset by negative SSSG.
"We are pleased with the growth in Distributable Cash per Unit
of 3.5% resulting in a solid Payout Ratio of 88.4% for the third
quarter", said Jordan Holm,
President of BPI. "Modest economic improvements in oil and
gas regions versus the third quarter in 2016 helped drive improved
sales results in the Period, despite the continued adverse impact
from the addition of a 6% PST on restaurant food in Saskatchewan. Our successful fire-grilled
pizza promotion, which started in the second quarter, and increased
online take-out and delivery sales driven by the launch of our new
Boston Pizza website during the Period also contributed positively
to our third quarter results."
The Fund's net and comprehensive income was $5.4 million for the Period compared to
$10.5 million for the third quarter
of 2016. The $5.1 million
decrease in the Fund's net and comprehensive income for the Period
compared to the third quarter of 2016 was primarily due to a
$6.4 million change in fair
value adjustments partially offset by lower non-cash deferred
income taxes of $1.4 million.
The Fund's net and comprehensive income was $19.9 million YTD compared to $29.0 million year-to-date in 2016. The
$9.1 million decrease in the
Fund's net and comprehensive income YTD compared to the same period
in 2016 was primarily due to a $10.0
million change in fair value adjustments and higher interest
expense on Class B Units of Boston Pizza Royalties Limited
Partnership (the "Class B Units") held by BPI of $0.5 million, partially offset by lower
non-cash deferred income taxes of $1.1 million and an increase in Royalty
income of $0.5 million. For a
detailed discussion on the Fund's net and comprehensive income,
please see the "Operating Results – Net and Comprehensive
Income / Basic and Diluted Earnings" section in the Fund's
MD&A for the Period. The Fund's net income under International
Financial Reporting Standards ("IFRS") contains non-cash items,
such as the fair value adjustments on financial instruments and
deferred income taxes, that do not affect the Fund's business
operations or its ability to pay distributions to unitholders. In
the Fund's view, net income is not the only or most meaningful
measurement of the Fund's ability to pay distributions.
Consequently, the Fund reports the non-IFRS metrics of
Distributable Cash and Payout Ratio to provide investors with more
meaningful information regarding the amount of cash that the Fund
has generated to pay distributions and the extent to which the Fund
has distributed that cash. Readers are cautioned that
Distributable Cash and Payout Ratio are non-IFRS financial measures
that do not have standardized meanings prescribed by IFRS and
therefore may not be comparable to similar measures presented by
other issuers. For a reconciliation between cash flow from
operating activities (the most directly comparable IFRS measure)
and Distributable Cash see the "Financial Summary" section of this
press release. For a detailed discussion on the Fund's
Distributable Cash and Payout Ratio, please see the "Operating
Results – Distributable Cash / Payout Ratio" section in the Fund's
MD&A for the Period and YTD.
The Fund generated Distributable Cash of $7.9 million for the Period compared to
$7.6 million for the third
quarter of 2016. The increase in Distributable Cash of
$0.3 million or 3.8%, was
primarily attributable to higher Royalty income. The Fund generated
Distributable Cash of $21.3 million YTD, relatively unchanged from
the same period in 2016. The nominal increase in
Distributable Cash of 0.2% was primarily due to higher Royalty
income, partially offset by higher interest expense on Class B
Units.
The Fund's Distributable Cash per Unit of the Fund ("Unit") was
$0.389 for the Period and
$1.049 YTD compared to $0.376 and $1.047,
respectively, for the same periods in 2016. The increases in
Distributable Cash per Unit of $0.013
or 3.5% for the Period and $0.002 or
0.2% YTD, are primarily attributable to the increases in
Distributable Cash noted above.
The Fund's Payout Ratio for the Period was 88.4% and 98.5% YTD
compared to 91.8% and 98.2%, respectively, in the same periods in
2016. The decrease in the Fund's Payout Ratio for the Period
compared to the same period in 2016 was due to the combined effects
of Distributable Cash increasing by $0.3
million or 3.8% and distributions paid during the Period
remaining unchanged compared to the same period in 2016. The
increase in the Fund's Payout Ratio YTD compared to the same period
in 2016 was due to the combined effects of distributions paid YTD
increasing by $0.1 million or 0.6%
and Distributable Cash YTD increasing by a nominal amount or
0.2%. The increase in distributions paid YTD compared to the
same period one year ago was due to the Fund increasing the monthly
distribution from 10.83 cents per Unit to 11.5 cents per
Unit beginning with the January 2016 distribution, which was
paid on February 29, 2016. The Fund strives to provide
unitholders with consistent monthly distributions, and as a result,
the Fund will generally experience seasonal fluctuations in its
Payout Ratio. The Fund's Payout Ratio is likely to be higher
in the first and fourth quarters each year compared to the second
and third quarters each year since Boston Pizza restaurants
generally experience higher Franchise Sales during the summer
months when restaurants open their patios and benefit from
increased tourist traffic. Higher Franchise Sales generally
result in increases in Distributable Cash. On a trailing
12-month basis, the Fund's Payout Ratio was 99.2% as at
September 30, 2017. A key
feature of the Fund is that it is a "top line" structure, in which
BPI and Boston Pizza Canada Limited Partnership
("BP Canada LP") pay the Fund an amount based on
Franchise Sales from restaurants in the Fund's royalty pool.
Accordingly, unitholders of the Fund are not directly exposed to
changes in the operating costs or profitability of BPI, BP Canada
LP or individual Boston Pizza restaurants. Given this
structure, and that the Fund has no current mandate to retain
capital for other purposes, it is expected that the Fund will
maintain a Payout Ratio close to 100% over time as the trustees of
the Fund continue to distribute all available cash in order to
maximize returns to unitholders.
On November 9, 2017, the trustees of the Fund approved a
cash distribution to unitholders of 11.5 cents per Unit in
respect of the period from October 1, 2017 to October 31,
2017. This distribution will be payable on November 30,
2017 to unitholders of record at the close of business on
November 21, 2017. The Fund periodically reviews distribution
levels based on its policy of stable and sustainable distribution
flow to unitholders. Including the October 2017 distribution,
which will be paid on November 30, 2017, the Fund will have
paid out 184 consecutive monthly distributions totaling
$271.6 million or $19.03 per Unit. Unitholders have
received 18 distribution increases since the Fund's initial
public offering of Units in 2002.
FINANCIAL SUMMARY
The tables below set out selected information from the Fund's
condensed consolidated interim financial statements together with
other data and should be read in conjunction with the condensed
consolidated interim financial statements and MD&A of the Fund
for the three and nine month periods ended September 30, 2017 and 2016.
|
Q3 2017
|
Q3 2016
|
YTD 2017
|
YTD 2016
|
(in thousands of
dollars – except restaurants, SSSG, Payout Ratio and per Unit
items)
|
|
|
|
|
System-Wide Gross
Sales
|
286,731
|
281,538
|
823,568
|
809,759
|
Number of restaurants
in Royalty Pool
|
383
|
372
|
383
|
372
|
Franchise Sales
reported by restaurants in the Royalty Pool
|
221,547
|
215,597
|
636,644
|
624,498
|
|
|
|
|
|
Royalty
income
|
8,862
|
8,624
|
25,466
|
24,980
|
Distribution
Income
|
2,863
|
2,790
|
8,107
|
8,083
|
Interest
income
|
304
|
452
|
1,208
|
1,356
|
Total
revenue
|
12,029
|
11,866
|
34,781
|
34,419
|
Administrative
expenses
|
(273)
|
(292)
|
(910)
|
(875)
|
Interest expense on
debt
|
(611)
|
(619)
|
(1,824)
|
(1,841)
|
Interest expense on
Class B Unit and Class C GP Unit liabilities
|
(1,727)
|
(1,551)
|
(4,680)
|
(4,208)
|
Profit before fair
value adjustments and income taxes6
|
9,418
|
9,404
|
27,367
|
27,495
|
Fair value adjustment
on investment in BP Canada LP
|
(7,455)
|
9,237
|
(5,587)
|
19,635
|
Fair value adjustment
on Class B Unit liability
|
4,929
|
(4,833)
|
3,515
|
(10,292)
|
Fair value adjustment
on interest rate swaps
|
668
|
171
|
1,160
|
(265)
|
Current and deferred
income tax expense
|
(2,115)
|
(3,473)
|
(6,515)
|
(7,554)
|
Net and comprehensive
income
|
5,445
|
10,506
|
19,940
|
29,019
|
|
|
Basic earnings per
Unit
|
0.27
|
0.52
|
0.98
|
1.43
|
Diluted earnings per
Unit
|
0.02
|
0.52
|
0.80
|
1.43
|
|
|
|
|
|
Distributable Cash /
Distributions / Payout Ratio
|
|
|
|
|
Cash flows from
operating activities
|
9,953
|
9,718
|
28,074
|
27,730
|
|
|
Class C GP Unit
distributions to BPI
|
(300)
|
(450)
|
(1,200)
|
(1,350)
|
|
|
BPI Class B Unit
entitlement
|
(1,113)
|
(1,108)
|
(3,747)
|
(3,388)
|
|
Interest paid on
long-term debt
|
(615)
|
(560)
|
(1,835)
|
(1,782)
|
|
SIFT Tax on
Units
|
(5)
|
27
|
15
|
44
|
Distributable
Cash
|
7,920
|
7,627
|
21,307
|
21,254
|
Distributions
paid
|
6,999
|
6,999
|
20,996
|
20,877
|
Payout
Ratio
|
88.4%
|
91.8%
|
98.5%
|
98.2%
|
Distributable Cash
per Unit
|
0.389
|
0.376
|
1.049
|
1.047
|
Distributions paid
per Unit
|
0.345
|
0.345
|
1.035
|
1.028
|
|
|
|
|
|
Other
|
|
|
|
|
Same store sales
growth
|
0.4%
|
(0.5%)
|
(0.4%)
|
0.7%
|
Number of restaurants
opened
|
2
|
4
|
4
|
8
|
Number of restaurants
closed
|
1
|
0
|
3
|
2
|
|
|
|
|
|
|
|
|
Sep 30,
2017
|
Dec 31,
2016
|
Total
assets
|
|
|
433,905
|
444,332
|
Total
liabilities
|
|
|
135,152
|
181,120
|
|
|
Notes:
|
|
|
|
1)
|
"System-Wide Gross
Sales" means the gross revenue: (i) of the corporate Boston
Pizza restaurants in Canada owned by BPI; and (ii) reported to BP
Canada LP by franchised Boston Pizza restaurants in Canada, without
audit or other form of independent assurance, and in the case of
both (i) and (ii), including revenue from the sale of liquor, beer,
wine and revenue from BP Canada LP approved national promotions and
discounts and excluding applicable sales and similar
taxes.
|
2)
|
"Franchise
Sales" is the basis upon which Royalty and Distribution Income
are payable, and means the gross revenue: (i) of the corporate
Boston Pizza restaurants in Canada owned by BPI; and (ii) reported
to BP Canada LP by franchised Boston Pizza restaurants in Canada,
without audit or other form of independent assurance, and in the
case of both (i) and (ii), after deducting revenue from the sale of
liquor, beer, wine and revenue from BP Canada LP approved national
promotions and discounts and excluding applicable sales and similar
taxes. Nevertheless, BP Canada LP periodically conducts audits of
the Franchise Sales reported to it by its franchisees, and the
Franchise Sales reported herein include results from sales audits
of earlier periods.
|
3)
|
Distributable Cash is
a non-IFRS financial measure that does not have a standardized
meaning prescribed by IFRS and therefore may not be comparable to
similar measures presented by other issuers. This non-IFRS
financial measure provides useful information to investors
regarding the amount of cash the Fund has generated for
distribution on the Units. The preceding table provides a
reconciliation from this non-IFRS financial measure to cash flows
from operating activities, which is the most directly comparable
IFRS measure. Investors are cautioned that this should not be
construed as an alternative to cash flows from operating
activities. For additional information regarding this
financial metric, see the heading "Description of Non-IFRS and
Additional IFRS Measures" in the Fund's MD&A for the Period and
YTD.
|
4)
|
Payout Ratio is
calculated by dividing the distributions paid by the Fund during a
period by the Distributable Cash generated in that period.
Payout Ratio is a non-IFRS financial measure that does not have a
standardized meaning prescribed by IFRS and therefore may not be
comparable to similar measures presented by other issuers.
This non-IFRS financial measure provides investors with useful
information regarding the extent to which the Fund distributes cash
on the Units. Investors are cautioned that this should not be
construed as an alternative net income measure of profitability. As
the Payout Ratio is calculated from a formula which includes
Distributable Cash, which is a non-IFRS measure, a reconciliation
of Payout Ratio to an IFRS measure is not possible. For
additional information regarding this financial metric, see the
heading "Description of Non-IFRS and Additional IFRS Measures" in
the Fund's MD&A for the Period and YTD.
|
5)
|
The Fund licenses BPI
the right to use various Boston Pizza trademarks in return for BPI
paying the Fund a royalty equal to 4% of Franchise Sales of Boston
Pizza restaurants in the Fund's royalty pool
("Royalty"). "Distribution Income" is income
received indirectly by the Fund on Class 1 LP Units and Class 2 LP
Units of BP Canada LP. See the "Overview – Purpose of the
Fund / Sources of Revenue" section of the Fund's MD&A for the
Period and YTD for more details.
|
6)
|
Profit before fair
value adjustments and income taxes is an additional IFRS
measure. For additional information regarding these financial
metrics, see the heading "Description of Non-IFRS and Additional
IFRS Measures" in the Fund's MD&A for the Period and
YTD.
|
7)
|
Other capitalized
terms used in this press release are defined in the Fund's MD&A
for the Period and YTD.
|
SUMMARY OF QUARTERLY RESULTS
|
Q3 2017
|
Q2 2017
|
Q1 2017
|
Q4 2016
|
(in thousands of
dollars – except restaurants, SSSG, Payout Ratio and per Unit
items)
|
|
|
|
|
System-Wide Gross
Sales
|
286,731
|
275,637
|
261,200
|
270,800
|
Number of restaurants
in Royalty Pool
|
383
|
383
|
383
|
372
|
Franchise Sales
reported by restaurants in the Royalty Pool
|
221,547
|
212,691
|
202,406
|
204,121
|
|
|
|
|
|
Royalty
income
|
8,862
|
8,508
|
8,096
|
8,165
|
Distribution
Income
|
2,863
|
2,686
|
2,558
|
2,617
|
Interest
income
|
304
|
452
|
452
|
452
|
Total
revenue
|
12,029
|
11,646
|
11,106
|
11,234
|
Administrative
expenses
|
(273)
|
(335)
|
(302)
|
(299)
|
Interest expense on
debt
|
(611)
|
(612)
|
(601)
|
(620)
|
Interest expense on
Class B Unit and Class C GP Unit liabilities
|
(1,727)
|
(1,756)
|
(1,197)
|
(2,184)
|
Profit before fair
value adjustments and income taxes
|
9,418
|
8,943
|
9,006
|
8,131
|
Fair value adjustment
on investment in BP Canada LP
|
(7,455)
|
2,575
|
(707)
|
5,098
|
Fair value adjustment
on Class B Unit liability
|
4,929
|
(1,561)
|
147
|
(2,668)
|
Fair value adjustment
on interest rate swaps
|
668
|
493
|
(1)
|
967
|
Current and deferred
income tax expense
|
(2,115)
|
(2,527)
|
(1,873)
|
(2,782)
|
Net and comprehensive
income
|
5,445
|
7,923
|
6,572
|
8,746
|
|
|
|
|
|
Basic earnings per
Unit
|
0.27
|
0.39
|
0.32
|
0.43
|
Diluted earnings per
Unit
|
0.02
|
0.39
|
0.26
|
0.43
|
|
|
|
|
|
Distributable Cash /
Distributions / Payout Ratio
|
|
|
|
|
Cash flows from
operating activities
|
9,953
|
9,379
|
8,742
|
9,128
|
|
|
Class C
GP Unit distributions to
BPI
|
(300)
|
(450)
|
(450)
|
(450)
|
|
|
BPI Class B Unit
entitlement
|
(1,113)
|
(1,304)
|
(1,330)
|
(1,134)
|
|
Interest paid on
long-term debt
|
(615)
|
(619)
|
(601)
|
(612)
|
|
SIFT Tax on
Units
|
(5)
|
53
|
(33)
|
(7)
|
Distributable
Cash
|
7,920
|
7,059
|
6,328
|
6,925
|
Distributions
paid
|
6,999
|
6,998
|
6,999
|
6,999
|
Payout
Ratio
|
88.4%
|
99.1%
|
110.6%
|
101.1%
|
Distributable Cash
per Unit
|
0.389
|
0.348
|
0.312
|
0.341
|
Distributions paid
per Unit
|
0.345
|
0.345
|
0.345
|
0.345
|
|
|
|
|
|
Other
|
|
|
|
|
Same store sales
growth
|
0.4%
|
(1.6%)
|
0.0%
|
(3.1%)
|
Number of restaurants
opened
|
2
|
1
|
1
|
5
|
Number of restaurants
closed
|
1
|
1
|
1
|
0
|
SUMMARY OF QUARTERLY RESULTS (continued)
|
Q3 2016
|
Q2 2016
|
Q1 2016
|
Q4 2015
|
(in thousands of
dollars – except restaurants, SSSG, Payout Ratio and per Unit
items)
|
|
|
|
|
System-Wide Gross
Sales
|
281,538
|
274,039
|
254,182
|
272,017
|
Number of restaurants
in Royalty Pool
|
372
|
372
|
372
|
366
|
Franchise Sales
reported by restaurants in the Royalty Pool
|
215,597
|
210,852
|
198,049
|
205,365
|
|
|
|
|
|
Royalty
income
|
8,624
|
8,434
|
7,922
|
8,215
|
Distribution
Income
|
2,790
|
2,728
|
2,565
|
2,708
|
Interest
income
|
452
|
452
|
452
|
452
|
Total
revenue
|
11,866
|
11,614
|
10,939
|
11,375
|
Administrative
expenses
|
(292)
|
(296)
|
(287)
|
(298)
|
Interest expense on
debt
|
(619)
|
(612)
|
(610)
|
(596)
|
Interest expense on
Class B Unit and Class C GP Unit liabilities
|
(1,551)
|
(1,573)
|
(1,084)
|
(1,862)
|
Profit before fair
value adjustments and income taxes
|
9,404
|
9,133
|
8,958
|
8,619
|
Fair value adjustment
on investment in BP Canada LP
|
9,237
|
6,511
|
3,887
|
3,584
|
Fair value adjustment
on Class B Unit liability
|
(4,833)
|
(3,407)
|
(2,052)
|
(1,634)
|
Fair value adjustment
on interest rate swaps
|
171
|
7
|
(443)
|
47
|
Current and deferred
income tax expense
|
(3,473)
|
(2,240)
|
(1,841)
|
(1,954)
|
Net and comprehensive
income
|
10,506
|
10,004
|
8,509
|
8,662
|
|
|
|
|
|
Basic earnings per
Unit
|
0.52
|
0.49
|
0.42
|
0.42
|
Diluted earnings per
Unit
|
0.52
|
0.49
|
0.42
|
0.42
|
|
|
|
|
|
Distributable Cash /
Distributions / Payout Ratio
|
|
|
|
|
Cash flows from
operating activities
|
9,718
|
9,323
|
8,689
|
9,259
|
|
|
Class C GP Unit
distributions to BPI
|
(450)
|
(450)
|
(450)
|
(450)
|
|
|
BPI Class B Unit
entitlement
|
(1,108)
|
(1,119)
|
(1,161)
|
(1,011)
|
|
Interest paid on
long-term debt
|
(560)
|
(617)
|
(605)
|
(617)
|
|
SIFT Tax on
Units
|
27
|
(20)
|
37
|
(23)
|
Distributable
Cash
|
7,627
|
7,117
|
6,510
|
7,158
|
Distributions
paid
|
6,999
|
6,998
|
6,880
|
6,642
|
Payout
Ratio
|
91.8%
|
98.3%
|
105.7%
|
92.8%
|
Distributable Cash
per Unit
|
0.376
|
0.351
|
0.320
|
0.350
|
Distributions paid
per Unit
|
0.345
|
0.345
|
0.338
|
0.325
|
|
|
|
|
|
Other
|
|
|
|
|
Same store sales
growth
|
(0.5%)
|
2.1%
|
0.6%
|
2.2%
|
Number of restaurants
opened
|
4
|
4
|
0
|
5
|
Number of restaurants
closed
|
0
|
0
|
2
|
2
|
OUTLOOK
Boston Pizza is well positioned for future growth and should
continue to strengthen its position as the number one casual dining
brand in Canada by achieving
positive SSSG and opening new Boston Pizza locations across
Canada.
The two principal factors that affect SSSG are changes in
customer traffic and changes in average guest cheque. BPI's
and BP Canada LP's strategies to drive higher guest
traffic include attracting a wide variety of guests into the
restaurant, sports bar and take-out/delivery parts of each
location, offering a compelling value proposition to guests and
leveraging a larger marketing budget versus the previous year along
with a revised calendar of national and local store
promotions. Increased average cheque levels are expected to
be achieved through a combination of culinary innovation and annual
menu re-pricing. In addition, the franchise agreement
governing each Boston Pizza restaurant requires a complete store
renovation every seven years. Restaurants typically close for
two to three weeks to complete the renovation and experience an
incremental sales increase in the year following the
re‑opening.
Boston Pizza remains well positioned for future expansion as
evidenced by the 11 Net New Restaurants that opened in 2016 and the
seven new locations that have opened to date in 2017. There
are currently four new locations under construction. BPI's
management believes that Boston Pizza will continue to serve more
guests in more locations than any other casual dining brand in
Canada by pursuing further
restaurant development opportunities across the country.
ABOUT US
The Fund is a limited purpose open ended trust with an
excellent track record for investors since its IPO in 2002.
Including the October 2017
distribution which is payable on November
30, 2017, the Fund has delivered 18 distribution increases
and 184 consecutive monthly distributions to unitholders totalling
$271.6 million or $19.03 per unit since 2002. The Fund earns
revenue based on the franchise system sales of the 383 Boston Pizza
restaurants included in the Fund's royalty pool.
BPI is Canada's number one
casual dining brand with annual gross sales in excess of
$1.0 billion serving more than 45
million guests through over 380 mainly franchisee operated
restaurants. The Boston Pizza brand has successfully existed
for over 50 years since opening its first restaurant in
Edmonton, Alberta in 1964.
BPI has been recognized as a Platinum Member of Canada's 50 Best Managed Companies and has
been a Franchisees' Choice Designation winner for six consecutive
years.
Certain information in this press release constitutes
"forward-looking information" that involves known and unknown
risks, uncertainties, future expectations and other factors which
may cause the actual results, performance or achievements of the
Fund, Boston Pizza Holdings Trust, Boston Pizza Royalties Limited
Partnership, Boston Pizza Holdings Limited Partnership, Boston
Pizza Holdings GP Inc., Boston Pizza GP Inc., BPI, BP Canada LP,
Boston Pizza Canada Holdings Inc., Boston Pizza Canada Holdings
Partnership, Boston Pizza restaurants, or industry results, to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
information. All statements, other than statements of
historical facts, included in this press release that address
activities, events or developments that the Fund or management of
BPI expects or anticipates will or may occur in the future,
including such things as, seasonal fluctuations in the Payout
Ratio, the Payout Ratio is likely to be higher in the first and
fourth quarters, higher Franchise Sales generally result in
increases in Distributable Cash, a Payout Ratio close to 100% will
be maintained, trustees of the Fund will continue to distribute all
available cash in order to maximize returns to unitholders, Boston
Pizza being well positioned for future growth, the strengthening of
Boston Pizza's position as the number one casual dining brand in
Canada, the achievement of
positive SSSG, opening of new restaurants, increases in average
guest cheques levels, incremental sales increasing after store
renovations, plans to pursue restaurant development opportunities
and other such matters are forward-looking information. When
used in this press release, forward-looking information may include
words such as "anticipate", "estimate", "may", "will", "expect",
"believe", "plan", "should", "continue" and other similar
terminology. The material factors and assumptions used to
develop the forward-looking information contained in this press
release include the following: future results being similar to
historical results, expectation related to future general economic
conditions, business plans, receipt of franchise fees and other
amounts, franchisees access to financing, pace of commercial real
estate development, protection of intellectual property rights of
Boston Pizza Royalties Limited Partnership and absence of changes
of laws. Risks, uncertainties and other factors that may cause
actual results, performance or achievements to be materially
different from any future results, performance or achievement
expressed or implied by the forward-looking information contained
herein, relate to (among others) competition, demographic trends,
consumer preferences and discretionary spending patterns, business
and economic conditions, legislation and regulation, Distributable
Cash and reliance on operating revenues, accounting policies and
practices, the results of operations and financial condition
of BPI, BP Canada LP and the Fund, as well as those factors
discussed under the heading "Risks and Uncertainties" in the most
recent Annual Information Form of the Fund. This information
reflects current expectations regarding future events and operating
performance and speaks only as of the date of this press release.
Except as required by law, the Fund and BPI assume no obligation to
update previously disclosed forward-looking information. For a
complete list of the risks associated with forward-looking
information and the Fund's business, please refer to the "Risks and
Uncertainties" and "Note Regarding Forward-Looking Information"
sections included in the Fund's MD&A for the Period and YTD
available at http://www.sedar.com/ and www.bpincomefund.com.
The trustees of the Fund approved the contents of this press
release.
SOURCE Boston Pizza Royalties Income Fund