Pizza Pizza Royalty Corp. · TSX:PZA

Pizza Pizza Royalty — Investor Presentation (March 2018)

29 slides from Pizza Pizza Royalty's investor presentation, Mar 8, 2018

  1. Slide 1: Pizza Pizza Royalty Corp. Investor Presentation

    PIZZA PIZZA ROYALTY CORP. Investor Presentation March 8, 2018

  2. Slide 2: Forward-Looking Statements

    • This presentation will contain forward- looking statements. • Investors should be aware that any forward-looking statements are subject to FORWARD- risks and uncertainties that could cause LOOKING actual results to differ materially from those disclosed here today. STATEMENTS • Investors are direct

  3. Slide 3: Paul Goddard, Chief Executive Officer

    PAUL GODDARD Pizza Pizza Limited Chief Executive Officer 3

  4. Slide 4: Pizza Pizza Royalty Corp.

    PIZZA PIZZA ROYALTY CORP. Trademarks & trade names are the Company’s major assets

  5. Slide 5: Ownership Structure

    Shareholders Pizza Pizza Pizza Pizza Limited Royalty Corp. (22.3%) (77.7%) OWNERSHIP Pizza STRUCTURE Pizza Royalty Limited The Partnership has two partners and owns the trademarks and brand names. 5

  6. Slide 6: Ownership Structure

    Shareholders Pizza Pizza Pizza Pizza Limited Royalty Corp. (22.3%) (77.7%) OWNERSHIP Pizza STRUCTURE Pizza Royalty Limited The Partnership pays monthly distributions to its two partners. 6

  7. Slide 7: $35.6 Million in Royalty Revenue

    $35.6 MILLION IN ROYALTY REVENUE ($551 MILLION SYSTEM SALES) Licence and royalty agreements with Pizza Pizza Limited provide cash flow stability to investors, without exposure to operational risks.

  8. Slide 8: Monthly Dividend Growth

    MONTHLY DIVIDEND GROWTH +2.6% +1.9% +2.5% +2.3% +4.2% +4.0% $0.080 +2.7% $0.072 $0.0697 $0.0713 $0.0667 $0.0680 $0.0625 $0.0650 $0.064 $0.0600 $0.0584 $0.056 $0.048 $0.040 $0.032 $0.024 $0.016 $0.008 $0.000 Jan-11 May-12 Jan -13 Jun-13 Jan-14 Apr-15 Nov-15 Jun-16 PPRC increased dividends seven times

  9. Slide 9: 50th Anniversary: The Private Operating Company

    50TH ANNIVERSARY THE PRIVATE OPERATING COMPANY

  10. Slide 10: Core Business Fundamentals

    • Canada’s #1 pizzeria • Seasoned management CORE • Strong & proven business model BUSINESS • Powerful brands FUNDAMENTALS • Geographic diversification • Modernized restaurant chain • Innovation leader since 1967 Pizza Pizza Limited’s mandate is to grow and protect the brands.

  11. Slide 11: Canada's #1 Pizzeria

    CANADA’S #1 PIZZERIA Building a national presence outside our core Alberta and Ontario markets. 11

  12. Slide 12: Slide 12

  13. Slide 13: Restaurant re-imaging program underway

    Restaurant re-imaging program underway

  14. Slide 14: Alberta Pizza Market Leader

    GUITWEDE- -7 ALBERTA PIZZA MARKET LEADER

  15. Slide 15: Restaurant Growth

    RESTAURANT GROWTH 800 760 752 723 732 739 695 694 101 108 671 690 94 102 103 640 88 89 89 81 600 72 222 225 228 231 219 231 216 228 225 199 400 200 386 398 408 411 423 421 369 374 379 376 0 08 09 10 11 12 13 14 15 16 17 Traditional - Pizza Pizza Non-Traditional - Pizza Pizza Pizza 73

  16. Slide 16: Non-Traditional Partnerships

    NON-TRADITIONAL PARTNERSHIPS Sponsorships Non-Traditional Locations Special Events TM Partnering with major sports arenas, entertainment venues and special 16 community events provide marketing and business opportunities.

  17. Slide 17: Product Innovation

    PRODUCT INNOVATION NEW PRODUCT LAUNCHES ARE KEY TO SALES BUILDING 17

  18. Slide 18: Technological Innovation

    TECHNOLOGICAL INNOVATION INNOVATION + CONVENIENCE = SALES GROWTH

  19. Slide 19: Powerful Brands & Marketing

    POWERFUL BRANDS & MARKETING Mot «fresh www pizzapizza.c@ PIZZA 73> PF HR ee CINEPLEX See the Big Picture MOVIE ADMISSION PASS WITH EVERY ONLINE OR MOBILE APP ORDER LARGE PIZZA *3 TOPPINGS +3 FREE COKE SCORE SAVINGS! 7 : ig] 2Mepwe pizzas 49 a I od 5 2 +4 TOPPINGS (comeien) ta ; *6 FREE COKE 19 a"1 e

  20. Slide 20: Social Responsibility

    SOCIAL RESPONSIBILITY Our fundraising events have raised over $3,000,000 for various charities including the Children’s Miracle Network.

  21. Slide 21: Curt Feltner, Chief Financial Officer

    CURT FELTNER Pizza Pizza Limited Chief Financial Officer 21

  22. Slide 22: Shareholder Information

    • TSX exchange listing PZA • Publicly-traded shares outstanding 24,618,392 SHAREHOLDER • Fully Diluted shares 31,666,003 INFORMATION • Pizza Pizza Limited’s ownership 22.3% PPRC, A HIGH-YIELD DIVIDEND CORPORATION. • Market capitalization $450 million • Current monthly dividend $0.0713 • Credit facil

  23. Slide 23: 2017 Performance Highlights

    • Royalty Pool System Sales $551 M • SSSG -0.1%% 2017 • Royalty Revenues $35.6 M PERFORMANCE • Adjusted earnings per share $0.894 HIGHLIGHTS • Dividend increased in June 2016 SSSG IS THE KEY DRIVER OF SHAREHOLDER YIELD. • $5.1 million working capital reserve • Dividends per share $0.8556 • Pay-out r

  24. Slide 24: Royalty Pool System Sales

    ROYALTY POOL SYSTEM SALES 600 ($ millions) 450 300 $534 $545 $551 $482 $491 $505 $468 150 0 11 12 13 14 15 16 17 Royalty revenues are based on top-line Royalty Pool System Sales. 24

  25. Slide 25: Same Store Sales Growth

    SAME STORE SALES GROWTH 5% 3% 4.5% 2.6% 2.7% 1% 2.1% 1.9% 1.1% -0.1% -0.1% -1% 2011 2012 2013 2014 2015 2016 2017 SSSG is the key driver of shareholder yield growth. 25

  26. Slide 26: Monthly Dividend Growth

    MONTHLY DIVIDEND GROWTH +2.5% +2.3% +2.6% +1.9% $0.080 +4.0% +4.2% +2.7% $0.072 $0.0713 $0.0697 $0.0667 $0.0680 $0.0650 $0.064 $0.0625 $0.0584 $0.0600 $0.056 $0.048 $0.040 $0.032 $0.024 $0.016 $0.008 $0.000 Jan-11 May-12 Jan -13 Jun-13 Jan-14 Apr-15 Nov-15 Jun-16 PPRC increased dividends seven times

  27. Slide 27: Advantages of PZA

    • Royalty Structure • High-yield Dividend Corp ADVANTAGES • Sales Growth History OF PZA • Exceptional Brand Recognition • Stable Quick Service Industry • Strong cash position 27

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