Business
Pizza Pizza Royalty Income Fund Increases Distribution based on Sustained Growth in Same-Store Sales
Pizza Pizza Royalty Income Fund Increases Distribution based on Sustained Growth in Same-Store Sales.
About this update from Pizza Pizza Royalty Corp.
[{"type":"text","content":"\n\n\n\nTORONTO, Jan. 15 /CNW/ - Pizza Pizza Royalty Income Fund (the \"Fund\")\n(TSX: PZA.UN) today announced an increase in its monthly cash distributions to\nUnitholders. This is the fourth distribution increase since the Fund's 2005,\ninitial public offering.\n\n\nFor the period January 1 to January 31, 2007, the monthly distribution\nper unit will increase 2.8% to $0.073 from $0.071. It will be paid on\nFebruary 15, 2007 to Unitholders of record at the close of business on\nJanuary 31, 2007.\n\n\nBusiness activities underlying the Fund continued to be solid in the\nfourth quarter ended December 31, 2006 as Pizza Pizza Limited experienced a 5%\nsame-store sales growth over the same period last year. System Sales of the\nPizza Pizza restaurants in the Royalty Pool for the fourth quarter were\n$93.9 million and the payout ratio was 91%. For the year ended December 31,\n2006 the Fund's payout ratio was 95%.\n\n\nA percentage of the 2006 distributions received by Unitholders will be a\ntax-deferred return of capital. The return of capital percentage is estimated\nto be 53% with the remaining 47% being taxable.\n\n\nAbout the Fund, a publicly-traded entity\n\n\nThe Fund is a limited purpose, open-ended trust established under the\nlaws of Ontario to indirectly acquire the trademarks and trade names used by\nPizza Pizza Limited (\"Pizza Pizza\") in its restaurants. The trademarks were\nlicensed to Pizza Pizza in 2005 for 99 years, for which Pizza Pizza pays the\nFund a royalty equal to 6% of the system sales of its Pizza Pizza restaurants\nin the Royalty Pool. As of January 1, 2007, there were 531 Pizza Pizza\nrestaurants in the Royalty Pool.\n\n\nA key attribute of the Fund is that it is based on top-line, system sales\nof the Royalty Pool restaurants and not on the profitability of either Pizza\nPizza or the restaurants in the Royalty Pool. The success of the Fund depends\nprimarily on the ability of Pizza Pizza to maintain and increase system sales\nof the Royalty Pool and to meet its royalty obligations.\n\n\nThe Fund's trust units are listed on the Toronto Stock Exchange under the\nsymbol PZA.UN.\n\n\nAbout Pizza Pizza Limited, the privately-owned operating company\n\n\nPizza Pizza Limited, a privately-held Canadian corporation, is one of\nCanada's most successful operators in the quick service restaurant industry.\nFounded i...