Accessibility Statement Skip Navigation
  • Resources
  • Blog
  • Journalists
  • Webcasts
  • Data Privacy
  • Français
  • my CNW 
    • Login
    • Register
  • Client Login 
    • Online Member Centre
    • Next Gen Communications Cloud
    • Cision Communications Cloud®
  • Sign Up
  • Send a Release
Return to PR Newswire homepage
  • News
  • Products
  • Contact
When typing in this field, a list of search results will appear and be automatically updated as you type.

Searching for your content...

No results found. Please change your search terms and try again.
Advanced Search
  • News in Focus
      • Browse News Releases

      • All News Releases
      • All Public Company
      • News Releases Overview

      • Multimedia Gallery

      • All Multimedia
      • All Photos
      • All Videos
      • Multimedia Gallery Overview

      • Trending Topics

      • All Trending Topics
  • Business
      • Auto & Transportation

      • All Automotive & Transportation
      • Aerospace, Defense
      • Air Freight
      • Airlines & Aviation
      • Automotive
      • Maritime & Shipbuilding
      • Railroads and Intermodal Transportation
      • Supply Chain/Logistics
      • Transportation, Trucking & Railroad
      • Travel
      • Trucking and Road Transportation
      • Auto & Transportation Overview

      • View All Auto & Transportation

      • Business Technology

      • All Business Technology
      • Blockchain
      • Broadcast Tech
      • Computer & Electronics
      • Computer Hardware
      • Computer Software
      • Data Analytics
      • Electronic Commerce
      • Electronic Components
      • Electronic Design Automation
      • Financial Technology
      • High Tech Security
      • Internet Technology
      • Nanotechnology
      • Networks
      • Peripherals
      • Semiconductors
      • Business Technology Overview

      • View All Business Technology

      • Entertain­ment & Media

      • All Entertain­ment & Media
      • Advertising
      • Art
      • Books
      • Entertainment
      • Film and Motion Picture
      • Magazines
      • Music
      • Publishing & Information Services
      • Radio & Podcast
      • Television
      • Entertain­ment & Media Overview

      • View All Entertain­ment & Media

      • Financial Services & Investing

      • All Financial Services & Investing
      • Accounting News & Issues
      • Acquisitions, Mergers and Takeovers
      • Banking & Financial Services
      • Bankruptcy
      • Bond & Stock Ratings
      • Conference Call Announcements
      • Contracts
      • Cryptocurrency
      • Dividends
      • Earnings
      • Earnings Forecasts & Projections
      • Financing Agreements
      • Insurance
      • Investments Opinions
      • Joint Ventures
      • Mutual Funds
      • Private Placement
      • Real Estate
      • Restructuring & Recapitalization
      • Sales Reports
      • Shareholder Activism
      • Shareholder Meetings
      • Stock Offering
      • Stock Split
      • Venture Capital
      • Financial Services & Investing Overview

      • View All Financial Services & Investing

      • General Business

      • All General Business
      • Awards
      • Commercial Real Estate
      • Corporate Expansion
      • Earnings
      • Environmental, Social and Governance (ESG)
      • Human Resource & Workforce Management
      • Licensing
      • New Products & Services
      • Obituaries
      • Outsourcing Businesses
      • Personnel Announcements
      • Real Estate Transactions
      • Residential Real Estate
      • Small Business Services
      • Socially Responsible Investing
      • Surveys, Polls and Research
      • Trade Show News
      • General Business Overview

      • View All General Business

  • Science & Tech
      • Consumer Technology

      • All Consumer Technology
      • Artificial Intelligence
      • Blockchain
      • Cloud Computing/Internet of Things
      • Computer Electronics
      • Computer Hardware
      • Computer Software
      • Consumer Electronics
      • Cryptocurrency
      • Data Analytics
      • Electronic Commerce
      • Electronic Gaming
      • Financial Technology
      • Mobile Entertainment
      • Multimedia & Internet
      • Peripherals
      • Social Media
      • STEM (Science, Tech, Engineering, Math)
      • Supply Chain/Logistics
      • Wireless Communications
      • Consumer Technology Overview

      • View All Consumer Technology

      • Energy & Natural Resources

      • All Energy
      • Alternative Energies
      • Chemical
      • Electrical Utilities
      • Gas
      • General Manufacturing
      • Mining
      • Mining & Metals
      • Oil & Energy
      • Oil and Gas Discoveries
      • Utilities
      • Water Utilities
      • Energy & Natural Resources Overview

      • View All Energy & Natural Resources

      • Environ­ment

      • All Environ­ment
      • Conservation & Recycling
      • Environmental Issues
      • Environmental Policy
      • Environmental Products & Services
      • Green Technology
      • Natural Disasters
      • Environ­ment Overview

      • View All Environ­ment

      • Heavy Industry & Manufacturing

      • All Heavy Industry & Manufacturing
      • Aerospace & Defense
      • Agriculture
      • Chemical
      • Construction & Building
      • General Manufacturing
      • HVAC (Heating, Ventilation and Air-Conditioning)
      • Machinery
      • Machine Tools, Metalworking and Metallurgy
      • Mining
      • Mining & Metals
      • Paper, Forest Products & Containers
      • Precious Metals
      • Textiles
      • Tobacco
      • Heavy Industry & Manufacturing Overview

      • View All Heavy Industry & Manufacturing

      • Telecomm­unications

      • All Telecomm­unications
      • Carriers and Services
      • Mobile Entertainment
      • Networks
      • Peripherals
      • Telecommunications Equipment
      • Telecommunications Industry
      • VoIP (Voice over Internet Protocol)
      • Wireless Communications
      • Telecomm­unications Overview

      • View All Telecomm­unications

  • Lifestyle & Health
      • Consumer Products & Retail

      • All Consumer Products & Retail
      • Animals & Pets
      • Beers, Wines and Spirits
      • Beverages
      • Bridal Services
      • Cannabis
      • Cosmetics and Personal Care
      • Fashion
      • Food & Beverages
      • Furniture and Furnishings
      • Home Improvement
      • Household, Consumer & Cosmetics
      • Household Products
      • Jewelry
      • Non-Alcoholic Beverages
      • Office Products
      • Organic Food
      • Product Recalls
      • Restaurants
      • Retail
      • Supermarkets
      • Toys
      • Consumer Products & Retail Overview

      • View All Consumer Products & Retail

      • Entertain­ment & Media

      • All Entertain­ment & Media
      • Advertising
      • Art
      • Books
      • Entertainment
      • Film and Motion Picture
      • Magazines
      • Music
      • Publishing & Information Services
      • Radio & Podcast
      • Television
      • Entertain­ment & Media Overview

      • View All Entertain­ment & Media

      • Health

      • All Health
      • Biometrics
      • Biotechnology
      • Clinical Trials & Medical Discoveries
      • Dentistry
      • FDA Approval
      • Fitness/Wellness
      • Health Care & Hospitals
      • Health Insurance
      • Infection Control
      • International Medical Approval
      • Medical Equipment
      • Medical Pharmaceuticals
      • Mental Health
      • Pharmaceuticals
      • Supplementary Medicine
      • Health Overview

      • View All Health

      • Sports

      • All Sports
      • General Sports
      • Outdoors, Camping & Hiking
      • Sporting Events
      • Sports Equipment & Accessories
      • Sports Overview

      • View All Sports

      • Travel

      • All Travel
      • Amusement Parks and Tourist Attractions
      • Gambling & Casinos
      • Hotels and Resorts
      • Leisure & Tourism
      • Outdoors, Camping & Hiking
      • Passenger Aviation
      • Travel Industry
      • Travel Overview

      • View All Travel

  • Policy & Public Interest
      • Policy & Public Interest

      • All Policy & Public Interest
      • Advocacy Group Opinion
      • Animal Welfare
      • Canadian Federal Government
      • Canadian Municipal Government
      • Canadian Provincial Government
      • Corporate Social Responsibility
      • Domestic Policy
      • Economic News, Trends, Analysis
      • Education
      • Environmental
      • European Government
      • FDA Approval
      • Federal and State Legislation
      • Federal Executive Branch & Agency
      • Foreign Policy & International Affairs
      • Homeland Security
      • Labor & Union
      • Legal Issues
      • Natural Disasters
      • Not For Profit
      • Patent Law
      • Public Safety
      • Trade Policy
      • Policy & Public Interest Overview

      • View All Policy & Public Interest

  • People & Culture
      • People & Culture

      • All People & Culture
      • Aboriginal, First Nations & Native American
      • African American
      • Asian American
      • Children
      • Diversity, Equity & Inclusion
      • Hispanic
      • Lesbian, Gay & Bisexual
      • Men's Interest
      • People with Disabilities
      • Religion
      • Senior Citizens
      • Veterans
      • Women
      • People & Culture Overview

      • View All People & Culture

  • Advanced Search
  • Overview
  • Cision Communications Cloud®
  • Monitoring
  • Distribution
  • Multimedia
  • Guaranteed Paid Placement
  • AI Tools
  • IR
  • Become a Client
  • Request a Demo
  • Editorial Bureaus
  • Partnerships
  • General Enquiries
  • Media
  • Worldwide Offices
  • Hamburger menu
  • Cision Canada
  • Send a Release
  • FR
    • Phone

    • 877-269-7890 from 8 AM - 10 PM ET

    • ALL CONTACT INFO
    • Contact Cision

      877-269-7890
      from 8 AM - 10 PM ET

  • Send a Release
  • Sign Up
  • Resources
  • Blog
  • Journalists
  • Webcasts
  • GDPR
  • News in Focus
    • Browse All News
    • Multimedia Gallery
    • Trending Topics
  • Business
    • Auto & Transportation
    • Business Technology
    • Entertain­ment & Media
    • Financial Services & Investing
    • General Business
  • Science & Tech
    • Consumer Technology
    • Energy & Natural Resources
    • Environ­ment
    • Heavy Industry & Manufacturing
    • Telecomm­unications
  • Lifestyle & Health
    • Consumer Products & Retail
    • Entertain­ment & Media
    • Health
    • Sports
    • Travel
  • Policy & Public Interest
    • Policy & Public Interest
  • People & Culture
    • People & Culture
  • Send a Release
  • Sign Up
  • Resources
  • Blog
  • Journalists
  • Webcasts
  • GDPR
  • Overview
  • Cision Communications Cloud®
  • Monitoring
  • Distribution
  • Multimedia
  • Guaranteed Paid Placement
  • AI Tools
  • IR
  • Send a Release
  • Sign Up
  • Resources
  • Blog
  • Journalists
  • Webcasts
  • GDPR
  • Become a Client
  • Request a Demo
  • Editorial Bureaus
  • Partnerships
  • General Enquiries
  • Media
  • Worldwide Offices
  • Send a Release
  • Sign Up
  • Resources
  • Blog
  • Journalists
  • Webcasts
  • GDPR

A&W Revenue Royalties Income Fund Announces Fourth Quarter 2017 Results


News provided by

A&W Revenue Royalties Income Fund

Feb 13, 2018, 12:30 ET

Share this article

Share toX

Share this article

Share toX

TRADING SYMBOL:  The Toronto Stock Exchange – AW.UN   

HIGHLIGHTS

  • Another strong quarter with same store sales up +3.1%
  • Royalty income increased by 6% for the quarter
  • Net income increased by 18% for 2017
  • Distributable cash increased 7% year over year

VANCOUVER, Feb. 13, 2018 /CNW/ - A&W Revenue Royalties Income Fund (the Fund) and A&W Food Services of Canada Inc. (A&W Food Services) today reported results for the fourth quarter and year ended December 31, 2017.  The Fund will hold a conference call to discuss the results on Tuesday, February 13, 2018 at 1:00 p.m. Pacific Time (4:00 p.m. Eastern Time).  The call can be accessed by dialling toll-free 1-800-263-0877 or (647) 794-1827 Passcode 9460268.  A replay will be available until February 20, 2018, by dialling toll-free 1-888-203-1112 or (647) 436-0148 Passcode 9460268. 

A&W reported strong same store sales growth of +3.1% for the fourth quarter of 2017, continuing the momentum from the previous two quarters, driven by a combination of successful marketing programs, the launch of natural A&W Root Beer and guest experience improvements. 

Annual royalty income for 2017 increased by 4.5% to $35,665,000 based on sales of $1,188,818,000.  The increase in sales and royalty income was due to the same store sales growth and the increase in the number of restaurants in the Royalty Pool on January 5, 2017 from 838 to 861.  Distributable cash increased by 4.1% and distributable cash per unit increased from $1.577 per unit to $1.641 per unit.  

"We are encouraged by the positive sales performance, despite the continuing challenge for the food service market, and the continued success of both our "better ingredients" strategy and our marketing programs.  We are also delighted with our expansion program - 45 new locations were opened in 2017, bringing the total number of restaurants to 918 at the end of the year," said Paul Hollands, Chairman and CEO of A&W Food Services.  "A&W is committed to being a leader in Canadian food service.  In the fourth quarter, A&W Food Services was proud to announce a substantial investment in the Canadian beef industry with a $5 million donation toward the University of Saskatchewan's Livestock and Forage Centre of Excellence - an investment that will be used to develop new approaches for healthy, sustainable agricultural practices. This cost is not borne by the Fund."

FINANCIAL HIGHLIGHTS






(dollars in thousands except per unit
amounts)

Period from
Sep 11, 2017 to
Dec 31, 2017

Period from

Sep 12, 2016 to
Dec 31, 2016

Period from
Jan 1, 2017 to
Dec 31, 2017

Period from
Jan 1, 2016 to
Dec 31, 2016

Same store sales growth(1)

+3.1%

+1.7%

+2.0%

+3.4%

Number of restaurants in the Royalty Pool

861

838

861

838

Sales reported by the restaurants in the Royalty Pool

$372,679

$351,494

$1,188,818

$1,137,830

Royalty income

$11,181

$10,545

$35,665

$34,135

General and administrative expenses

228

214

652

586

Net third party interest expense

789

781

2,583

2,574

Current income tax provision

1,879

1,982

5,985

6,500

Total distributable cash generated for
distributions and dividends(2)

$8,119

$7,568

$26,279

$24,475

Distributable cash per equivalent unit (2017 –
16,015,023 units; 2016 – 15,517,988 units)(2)(3)

$0.507

$0.488

$1.641

$1.577

Distributions and dividends declared per equivalent unit

$0.541

$0.532

$1.605

$1.558

Net income(4)

$8,160

$8,973

$28,220

$23,916

Net income, excluding non-cash items(4)

$8,430

$7,205

$26,816

$22,446



(1)

Same store sales growth does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers.  This information is provided as it is a key driver of growth in the Fund.  Same store sales growth is based on an equal number of days in each quarter.  

(2)

Distributable cash does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers.  This information is provided as it identifies the amount of actual cash available to pay distributions to unitholders and dividends to Food Services.  

(3)

The number of equivalent units and distributable cash per equivalent unit in 2017 includes the 150,665 LP units (as hereinafter defined) exchanged for 301,330 common shares of Trade Marks representing the final consideration paid in December 2017 for the January 5, 2017 adjustment to the Royalty Pool.  The number of equivalent units and distributable cash per equivalent unit in 2016 includes the 157,774 LP units exchanged for 315,548 common shares of Trade Marks representing the final consideration paid in December 2016 for the January 5, 2016 adjustment to the Royalty Pool. 

(4)

Net income in 2017 and 2016 includes non-cash losses on interest rate swaps, amortization of deferred financing fees and deferred income taxes.  These non-cash items have no impact on the Fund's ability to pay distributions to unitholders.  The Fund's net income excluding these non-cash items is presented for information purposes only.  Net income excluding non-cash items does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers.  

FINANCIAL RESULTS
Royalty income for the fourth quarter of 2017 was $11,181,000 based on sales of $372,679,000.  This was an increase of 6.0% from royalty income of $10,545,000 and sales of $351,494,000 for the fourth quarter of 2016.  There were 112 days of sales in the fourth quarter of 2017 as compared to 111 days in the same quarter of 2016.  Annual royalty income for 2017 was $35,665,000 based on sales of $1,188,818,000, an increase of 4.5% from royalty income of $34,135,000 and sales of $1,137,830,000 for 2016.  The increase in sales and royalty income was due to the combined impact of the additional net 23 new restaurants in the Royalty Pool and the same store sales growth of 3.1% for the quarter and 2.0% for the full year 2017 as compared to 2016.

Combined general and administrative expenses and interest increased by $22,000 in the quarter and $75,000 for the year.  Interest expense did not change significantly in 2017 year to date as compared to 2016.  General and administrative expenses were higher due to increased filing and professional fees. 

Distributable cash generated in the fourth quarter of 2017 to pay distributions to unitholders and dividends to Food Services was $8,119,000 compared to $7,568,000 in the fourth quarter of 2016.  Distributable cash generated per equivalent unit increased by 1.9¢ to 50.7¢ per unit in the fourth quarter of 2017 from 48.8¢ for the fourth quarter of 2016.  There were 112 days of sales in the fourth quarter of 2017 as compared to 111 days in the same quarter of 2016.

Distributable cash generated in 2017 was $26,279,000 compared to $24,475,000 in 2016.  The $1,804,000 annual increase in distributable cash was comprised of the $1,530,000 increase in royalty income, less the $241,000 increase in combined general and administrative, financing fees and interest expenses and a $515,000 decrease in the current income tax provision (excluding refundable income tax).  Distributable cash generated per equivalent unit increased by 6.4¢ to $1.641 per unit in 2017 from $1.577 for 2016. 

Four monthly distributions totalling 54.1¢ per unit were declared in the fourth quarter of 2017 compared to 53.2¢ per unit in the same quarter of 2016.  Total distributions declared in 2017 were $1.605 per unit compared to $1.558 per unit in 2016, an increase of 3.0%.  The annual payout ratio for 2017 was 97.8% compared to 98.8% for 2016.    

The cumulative surplus of distributable cash at the end of 2017 was $3,363,000, compared to a cumulative surplus of $2,417,000 at the beginning of the year, an increase of $946,000. 

As a result of the performance of the Fund and the underlying A&W restaurants in the Royalty Pool, the Fund increased the monthly cash distributions by 2.3% from 13.3¢ per unit to 13.6¢ per unit beginning with the November 2017 distribution.  The current monthly distribution rate of 13.6¢ per unit represents an annualized distribution rate of $1.632 per unit, an increase of 2.3% from the 2016 annualized rate of $1.596 per unit.  The Fund will continue to periodically review distribution levels and distribute available cash in order to maximize returns to unitholders and maintain uniformity of distributions.

About the Fund
The Fund is a limited purpose trust established to invest in Trade Marks, which through its interest in A&W Trade Marks Limited Partnership (the Partnership), owns the A&W trade-marks used in the A&W quick service restaurant business in Canada.  The A&W trade-marks comprise some of the best-known brand names in the Canadian foodservice industry.  In return for licensing A&W Food Services to use its trade-marks, Trade Marks (through the Partnership) receives royalties equal to 3% of the sales of A&W restaurants in the Royalty Pool.  A&W is the second largest quick-service hamburger restaurant chain in Canada.  Operating coast-to-coast, A&W restaurants feature famous trade-marked menu items such as The Burger Family®, Chubby Chicken® and A&W Root Beer®.

The Royalty Pool is adjusted annually to reflect sales from new A&W restaurants, net of the sales of any A&W restaurants that have permanently closed.  Additional limited partnership units (LP units) are issued to A&W Food Services to reflect the annual adjustment.  A&W Food Services' additional LP units are exchanged for additional shares of Trade Marks which are exchangeable for units of the Fund.  The 16th annual adjustment to the Royalty Pool took place on January 5, 2018 at which time the number of restaurants in the Royalty Pool increased from 861 to 896. 

A&W Food Services owns 24.7% of the common shares of Trade Marks, and therefore owns the equivalent of 24.7% of the units of the Fund on a fully-diluted basis.   

Trade Marks' dividends to A&W Food Services and the Fund, and the Fund's distributions to unitholders are based on top-line revenues of the A&W restaurants in the Royalty Pool, less interest, general and administrative expenses and current income taxes of Trade Marks, and are thereby isolated from many of the factors that impact an operating business.

Follow A&W on Facebook (www.facebook.com/AWCanada) and Twitter @AWCanada or visit www.awincomefund.ca.

Certain statements in this press release may contain forward-looking information within the meaning of applicable securities laws in Canada (forward-looking information).  The words "anticipates", "believes", "budgets", "could", "estimates", "expects", "forecasts", "intends", "may", "might", "plans", "projects", "schedule", "should", "will", "would" and similar expressions are often intended to identify forward-looking information, although not all forward-looking information contains these identifying words.  The forward-looking information is based on assumptions that management considered reasonable at the time it was prepared.  The forward-looking information is subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by the forward-looking information.  The factors which could cause results to differ from current expectations are described in the Fund's most recent Management Discussion and Analysis under the heading "Risks and Uncertainties" and the Fund's Annual Information Form under the heading "Risk Factors", available on SEDAR at www.sedar.com.

SOURCE A&W Revenue Royalties Income Fund

Don Leslie, Chief Financial Officer: (604) 988-2141 or [email protected]

Modal title

Organization Profile

A&W Revenue Royalties Income Fund

    Also from this source

  • A&W Revenue Royalties Income Fund and A&W Food Services of Canada Announce Successful Closing of Combination Transaction

  • A&W REVENUE ROYALTIES INCOME FUND ANNOUNCES THIRD QUARTER 2024 RESULTS

  • A&W ANNOUNCES TIMING OF THIRD QUARTER 2024 RESULTS AND CONFERENCE CALL

Related Organization(s)

A&W Food Services of Canada Inc.

    Also from this source

  • Introducing the Steakhouse Teen Burger™, a sweet and smoky twist on A&W's iconic Teen Burger

  • A&W FOOD SERVICES OF CANADA INC. ANNOUNCES RESULTS OF 2025 ANNUAL GENERAL MEETING

  • A&W FOOD SERVICES OF CANADA INC. ANNOUNCES FIRST QUARTER RESULTS FOR FISCAL 2025 AND UPDATED 2025 OUTLOOK

Contact Cision

  • 866-245-2317
    from 8 AM - 10 PM ET
  • Become a Client
  • Request a Demo
  • Editorial Bureaus
  • Partnerships
  • General Enquiries
  • Media

Products

  • Cision Communications Cloud®
  • Media Monitoring
  • Content Distribution
  • Multimedia Distribution
  • Measurement & Analytics
  • Investor Relations

About

  • About Cision Canada
  • About Cision
  • Media Partners
  • Careers
  • Accessibility Statement
  • APAC
  • APAC - Simplified Chinese
  • APAC - Traditional Chinese
  • Brazil
  • Canada
  • Czech
  • Denmark
  • Finland
  • France
  • Germany
  • India
  • Indonesia
  • Israel
  • Japan
  • Korea
  • Mexico
  • Middle East
  • Middle East - Arabic
  • Netherlands
  • Norway
  • Poland
  • Portugal
  • Russia
  • Slovakia
  • Spain
  • Sweden
  • United States
  • Vietnam

My Services

  • All News Releases
  • Online Member Centre
  • Next Gen Communications Cloud
  • Cision Communications Cloud®
  • my CNW

Do not sell or share my personal information:

  • Submit via [email protected] 
  • Call Privacy toll-free: 877-297-8921

Contact Cision

Products

About

My Services
  • All News Releases
  • Online Member Centre
  • Next Gen Communications Cloud
  • Cision Communications Cloud
  • my CNW
877-269-7890
from 8 AM - 10 PM ET
  • Terms of Use
  • Information Security Policy
  • Site Map
  • Cookie Settings
  • Accessibility Statement
Copyright © 2025 CNW Group Ltd. All Rights Reserved. A Cision company.