In This Article:
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Same-Store Sales Decline: 5.3% overall decline; Pizza Pizza restaurants down 5.9%, Pizza 73 restaurants down 1.5%.
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Royalty Pool System Sales: Decreased 4.6% to $155.8 million from $163.2 million in the same quarter last year.
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Pizza Pizza Sales: Decreased 5% to $134.9 million.
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Pizza 73 Sales: Decreased 1.8% to $20.8 million.
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Royalty Income: Decreased 4.4% to $10 million for the quarter.
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Interest Income: $93,000 earned on cash and short-term investments.
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Administrative Expenses: $176,000 for the quarter.
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Interest Expense: $322,000 paid on a $47 million credit facility.
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Dividends Declared: $5.7 million or $23.25 per share, compared to $5.5 million or $22.5 per share in 2023.
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Payout Ratio: 109% for the quarter.
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Working Capital: Decreased by $500,000, ending the quarter at $6.3 million.
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Store Openings: 33 new locations opened year-to-date; net increase of 16 locations.
Release Date: November 04, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Pizza Pizza Royalty Corp (PZRIF) has introduced new value offerings, such as the XXL pizza and the 'All for One' special, which have been well-received by customers.
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The company has successfully expanded its restaurant network, opening 33 new locations in 2024, including both traditional and nontraditional formats.
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Pizza Pizza Royalty Corp (PZRIF) has leveraged its strong digital footprint and marketing campaigns, such as the 'Pickup Artists' campaign, to drive growth in pickup orders.
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The company has engaged in strategic collaborations, like the partnership with Tabasco, to enhance menu variety and drive brand visibility.
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Pizza Pizza Royalty Corp (PZRIF) continues to focus on providing value and convenience, which are key differentiators in the competitive QSR landscape.
Negative Points
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Pizza Pizza Royalty Corp (PZRIF) reported a 5.3% decline in same-store sales for the third quarter of 2024, with Pizza Pizza restaurants experiencing a 5.9% decline.
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The company faces ongoing challenges from reduced consumer spending and heightened competition, impacting traffic and sales.
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There has been a shift from delivery to pickup orders, which typically have lower average checks, affecting revenue.
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The company anticipates higher interest rates on its new credit facility, which could impact financial performance.
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Pizza Pizza Royalty Corp (PZRIF) experienced a payout ratio of 109% for the quarter, resulting in a decrease in working capital.
Q & A Highlights
Q: Have you observed any changes in consumer behavior due to recent decreases in interest rates? A: Paul Goddard, CEO, noted that while the decrease in interest rates is a positive signal, many consumers are still cautious with their discretionary spending. There has been a shift from delivery to pickup orders, which affects revenue due to lower average checks. Consumers are also more selective with their purchases, often opting out of additional items like dips or drinks.