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Second Cup Royalty Income Fund Announces Fourth Quarter Same Cafe Sales Growth and Annual Adjustment to Royalty Pool
MISSISSAUGA, ON, Jan. 17 /CNW/ - Second Cup Royalty Income Fund (the "Fund") and The Second Cup L...
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[{"type":"text","content":"\n\n\n\nMISSISSAUGA, ON, Jan. 17 /CNW/ - Second Cup Royalty Income Fund (the\n"Fund") and The Second Cup Ltd. ("Second Cup") announced today their unaudited\nsame cafe sales results for the fourth quarter and the annual adjustment to\nthe number of Second Cup cafes in the royalty pool (the "Royalty Pool"). The\nsystem sales of Second Cup cafes in the royalty pool is the basis on which the\nFund's indirect wholly-owned limited partnership, Second Cup Trade-Marks\nLimited Partnership ("MarksLP") receives royalty payments from Second Cup. The\nFund expects to release its audited annual financial results on or before\nMarch 14, 2008.\n\n\nUnaudited Same Cafe Sales Growth\n\n\nSame cafe sales growth for cafes in the Royalty Pool for the fourth\nquarter and the year ended December 31, 2007 is expected to be 0.7% and 3.0%\nrespectively.\n\n\n"Same cafe sales growth was particularly challenging in the quarter given\nthe comparatively strong results from the fourth quarter of 2006," commented\nBruce Elliot, President of Second Cup. "The poor weather across Canada in the\nmonth of December, compared to a very mild December the year before, also had\na negative impact on our cafes during our most important sales period of the\nyear. Cafes located on street fronts and strip centres, which comprise more\nthen 40% of our network, were the most affected."\n\n\nThe same cafe sales growth achieved in the fourth quarter represents the\n12th consecutive quarter of positive same cafe sales growth since the\ninception of the Fund, and the 17th consecutive quarter for Second Cup. Second\nCup also reported that cafes undergoing renovations in the quarter negatively\nimpacted sales by approximately 0.5% due to their temporary closure while\nunder renovation. In total, 40 cafes were renovated in 2007 compared to 11 in\n2006.\n\n\nRoyalty Pool Adjustment\n\n\nThe Royalty Pool is adjusted on January 1 of each year to include sales\nfrom new cafes that have been open for at least 60 days prior to November 1 of\nthe preceding year, after deducting sales of any Second Cup cafes that have\nclosed since the previous adjustment date. The Fund (through MarksLP) pays\nSecond Cup for the additional royalty stream, if any, from the sales of the\nnew cafes vended in to the Royalty Pool, based upon a formula...