MONCTON, NB, May 15 /CNW/ - PDM ROYALTIES INCOME FUND (the "Fund") reported today its financial results for the quarter ended March 31, 2007 and also announced that Pizza Delight Corporation Ltd. (PDC) reported its financial results for the quarter ended March 31, 2007.
Total revenues during the period were $3.5 million compared to $2.5 million for 2006. Distributable cash for the period was $0.391 per basic unit outstanding compared to actual distributions paid of $0.360 per unit. The revenue increase was generated by the acquisition of the Baton Rouge restaurants and the addition of new restaurants vended in January 1, 2007.
PDC achieved same store sales growth (SSSG) of 1.1% for the first quarter of 2007 (2006 (equal sign) 1.8%). Scores was the strongest division for the quarter with SSSG of 10.8% (2006 (equal sign) 9.8%) with Pizza Delight at 1.6% (2006 (equal sign) 4.8%), Mikes -4.0% (2006 (equal sign) -3.6%), and Baton Rouge was 0.1%.
System sales for the 261 restaurants (2006 - 251) included in the royalty pool increased to $89.1 million compared to $67.2 million for 2006. The growth reflects the addition of the Baton Rouge restaurants and the new restaurants added to the royalty pool on January 1, 2007.
In 2006, PDC completed significant brand research and evaluation of its Pizza Delight and Mikes brands to better understand its positioning in the market place. Based on the research, Pizza Delight has completed its design process for a new concept and opened its prototype restaurant in April 2007. The modified concept is an enhancement to its already well received decor while providing several new products and styles of service in a very inviting atmosphere. Sales results to date have been extremely positive. The Mikes brand is in the final stages of design of its new concept that is intended to focus the brand towards its core Italian offerings and expects to open a test location by the end of May.
Management expects significant SSSG from renovations to these new concepts in its current markets while the new format will provide a solid platform in the new markets where PDC plans to expand. The prototyping and testing of these new concepts will be completed in 2007 with a roll out of a renovation plan for existing restaurants to commence in 2008.
Having multiple brands enables PDC to continue opening new restaurants while the prototype is being completed. PDC has opened five Scores restaurants to date in 2007 and has an additional three Scores and three Baton Rouge restaurants under construction. PDC expects to open 10 Scores and five Baton Rouge restaurants plus renovate 10 restaurants in 2007.
The addition of Ron Magruder, a 36 year veteran of the restaurant industry, as the President and Chief Executive Officer of PDC adds substantial depth, knowledge and resources at the senior executive level. During the past few months Ron has gained a solid knowledge of PDC and its brands and is providing positive guidance in the expansion into new markets as well as providing increased direction and focus for each brand.
Complete financial statements are available at www.sedar.com
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 PDC 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.
PDC 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 the Province of Quebec and Ontario in the casual dining segment.