MONCTON, NB, Nov. 13 /CNW/ - PDM ROYALTIES INCOME FUND (TSX: PDM.UN, PDM.DB) (the "Fund") today reported its financial results for the third quarter ending September 30, 2008. Same store sales results for the royalty-pooled restaurants, Pizza Delight(R), Mikes(R), Scores(R), and Baton Rouge(R) was a positive 1.6% for the quarter compared to 1.8% in 2007.
Mikes led all brands with an increase of 4.1% (2007 (equal sign) -1.0%). This is the second quarter in a row of strong sales growth at Mikes providing Management further comfort that the brand's turnaround strategy is working for its customers and franchisees. Pizza Delight continues its impressive run with 21 consecutive quarterly same store sales increases with a positive 3.7% for the quarter (2007 (equal sign) +4.7%). Scores was a negative 1.4% compared to a 4.2% increase in the same quarter of 2007. Baton Rouge was a negative 1.2% compared to a 1.7% increase in the same quarter of 2007.
For the first nine months of 2008 Imvescor same store sales were positive at 0.4% (2007 (equal sign) +2.0%). Pizza Delight achieved same store sales growth of 3.9% (2007 (equal sign) +4.1%), Mikes was up 2.4%; (2007 (equal sign) -2.4%). Scores was negative 3.9% (2007 (equal sign) +8.9%), as was Baton Rouge at -0.7% (2007 (equal sign) +0.9%). The Scores challenges in 2008 include going against its own strong performance in 2006 and 2007 when the same store sales for each year were 7.5% and 6.3% respectively. Management has been testing several new products plus enhancements to the soup and salad bar as part of its sale generating programs.
Although the world markets have been on somewhat of a roller coaster ride Imvescor's diversity of brands and geographic locations provide somewhat of a cushion by providing the consumers with great products and great value.
During the third quarter of 2008 sales for the royalty pooled restaurants grew to $105.2 million from $95.6 million. The Fund earned revenues of $3.9 million, compared to $3.8 million and net earnings before undernoted items increased to $3.3 million from $3.2 million for the quarter.
On a year to date basis sales for the royalty pooled restaurants grew to $306 million from $278 million. The Fund earned revenues of $11.1 million, compared to $10.9 million and net earnings before undernoted items increased to $9.3 million from $8.9 million for the comparable nine month periods.
PDM Royalties Income Fund continues its monthly distributions of $0.12 per unit despite the market uncertainty. The Fund continues to generate cash in excess of the amounts required for current distributions and the interest on the convertible debentures and as announced on September 30, 2008 is continuing its repurchase of units for cancellation under the Normal Course Issuer Bid.
Complete financial statements are available at www.sedar.com
About the Fund
The Fund is a limited purpose open-ended trust established under the laws of Ontario. The Fund will make monthly distributions of its available cash to holders of units. The Fund indirectly owns the trade marks and intellectual property for the Pizza Delight, Mikes, Scores, and Baton Rouge brands and has licensed them to Imvescor in consideration for a royalty equal to 4% of system sales for Pizza Delight and Mikes restaurants, and a royalty rate of 6% for Scores and Baton Rouge restaurants.
Imvescor is a privately owned corporation, headquartered in Moncton, New Brunswick. It operates franchised and corporate restaurants under the brand names Pizza Delight(R), Mikes(R), Scores(R), and Baton Rouge(R) restaurants. Pizza Delight(R) operates primarily in Atlantic Canada, where it dominates the family/mid-scale segment. Mikes(R) and Scores(R) restaurants operate primarily in Quebec in the family and casual dining segments and the take-out and delivery segments. Baton Rouge(R) operates in Quebec and Ontario in the casual dining segment.
Certain information regarding the Fund contained herein may constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although the Fund believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. The Fund cautions that actual performance will be affected by a number of factors, many of which are beyond the Fund's control, and that future events and results may vary substantially from what the Fund currently foresees. Discussion of the various factors that may affect future results is contained in the annual information form of the Fund dated March 28, 2008 which is available at www.sedar.com. The Fund's forward-looking statements are expressly qualified in their entirety by this cautionary statement.