PDM ROYALTIES INCOME FUND (TSX: PDM.UN, PDM.DB) reported its financial results for the second quarter ending June 30, 2008. Same store sales results for the royalty-pooled restaurants, Pizza Delight, Mikes, Scores, and Bâton Rouge was a positive 1.4% for the quarter compared to 2.7% in 2007.
Mikes led all brands with an increase of 3.8% (2007 = -2.5%). Management views this as a strong indication that the brand's turnaround strategy is gaining momentum through its concept update roll-out, continued focus on offer enhancement and creating more value for its customers. Pizza Delight continued its impressive run of quarterly same store sales increases with a positive 3.6% for the quarter (2007 = 5.2%). This is the 20th consecutive quarter or the fifth year of same store sales growth for Pizza Delight, a significant achievement for the brand which recently celebrated its fortieth anniversary. Scores was a negative 2.7% compared to an 11.8% increase in the second quarter of 2007. Same store sales for the quarter at Bâton Rouge was a 0.6% increase (2007 = 1.0%).
For the first six months of 2008 Imvescor same store sales were slightly negative at 0.4% (2007 = +1.9%). Pizza Delight achieved same store sales growth of 4.0% (2007 = 3.4%), Mikes was up 0.8%; (-3.2% in 2007). Scores was negative 5.1% (+11.3% in 2007), as was Baton Rouge at -0.4% (2007 = +0.6%).
Despite the significant increase in the price of gas which impacts customers' discretionary spending, Imvescor management is cautiously optimistic that same store sales will not be adversely affected in the long term because of the strength of each of the brands' marketing programs and the positive momentum gained from concept updates and renovations.
During the second quarter of 2008 sales for the royalty pooled restaurants grew to $104 million from $93 million. The Fund earned revenues of $3.7 million, compared to $3.6 million and net earnings before undernoted items increased to $3.1 million from $2.9 million for the quarter.
On a year to date basis sales for the royalty pooled restaurants grew to $201 million from $183 million. The Fund earned revenues of $7.2 million, compared to $7.1 million and net earnings before undernoted items increased to $6.0 million from $5.7 million for the comparable 6 month periods.
PDM Royalties Income Fund continues its monthly distributions of $0.12 per unit despite the mild slowdown which persisted into the second quarter of 2008. The Fund's cash position (including the PDM Royalties Limited partnership), after allowing for the debenture interest payment on June 30, 2008, increased by over $500,000 during the six month period. -- www.cnxmarketlink.com
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