BOSTON PIZZA ROYALTIES INCOME FUND ANNOUNCES 2025 FIRST QUARTER RESULTS AND APRIL 2025 CASH DISTRIBUTION OF $0.115 PER UNIT

Cision Canada

09-05-2025

Toronto Stock Exchange: BPF.UN
HIGHLIGHTS
Franchise Sales 1 of $231.1 million for the Period, representing an increase of 4.1% versus the same period one year ago.
Same Restaurant Sales 2 of 4.4% for the Period.
Cash flows generated from operating activities of $9.3 million for the Period, representing an increase of 1.8% versus the same period one year ago.
Distributable Cash 3 increased 0.1% for the Period and Distributable Cash per Unit 4 remained unchanged for the Period.
Payout Ratio 5 of 100.2% for the Period and 100.7% on a trailing 12-month basis. Cash balance at the end of the Period was $4.6 million.
On May 8, 2025, the trustees of the Fund declared a distribution for the period of April 1, 2025 to April 30, 2025 of $0.115 per Unit, which will be payable on May 30, 2025 to unitholders of the Fund (" Unitholders") of record on May 21, 2025.
VANCOUVER, BC, May 9, 2025 /CNW/ - Boston Pizza Royalties Income Fund (the " Fund") and Boston Pizza International Inc. (" BPI") reported financial results today for the first quarter period from January 1, 2025 to March 31, 2025 (the " Period"). A copy of this press release, the unaudited condensed consolidated interim financial statements and related management's discussion and analysis (" MD&A") of the Fund and BPI are available at www.sedarplus.ca and www.bpincomefund.com. The Fund will host a conference call to discuss the results on May 9, 2025 at 8:30 am Pacific Time (11:30 am Eastern Time). The call can be accessed by dialling 1-833-821-3078 or [phone]. A replay will be available until June 9, 2025 by dialling 1-855-669-9658 or [phone] and entering the access code: 4873669 followed by the # sign. The replay will also be available at www.bpincomefund.com. Capitalized terms used in this press release that are not otherwise defined have the meanings ascribed to them in the Fund's MD&A for the Period.
"We're pleased with our first quarter performance, highlighted by record-high first quarter total franchise sales and strong same restaurant sales results," said Jordan Holm, President of BPI. "The positive response from our guests and the momentum in our business are especially encouraging as we prepare to navigate an increasingly complex economic environment in the quarters ahead. We're focused on building on this strong start by supporting our franchisees, delivering memorable dining experiences, and continuing to innovate in ways that drive long-term success."
PERIOD RESULTS
SRS, a key driver of distribution growth for Unitholders, was positive 4.4% for the Period compared to negative 1.0% reported in the first quarter of 2024. SRS for the Period was principally due to the positive performance of promotional initiatives, sustained momentum in the take-out and delivery business, and the benefit of being compared to softer performance in the first quarter of 2024.
Franchise Sales of Boston Pizza restaurants in the Royalty Pool were $231.1 million for the Period compared to $222.0 million for the first quarter of 2024. The $9.1 million increase in Franchise Sales for the Period was primarily due to positive SRS.
The Fund's net and comprehensive income was $6.3 million for the Period compared to $8.5 million for the first quarter of 2024. The decrease in the Fund's net and comprehensive income for the Period compared to the first quarter of 2024 was primarily due to a $3.2 million increase in fair value loss and a $0.1 million increase in current income tax expense, partially offset by a $0.7 million increase in deferred income tax recovery and a $0.5 million increase in Royalty Income 6 and Distribution Income 7.
Cash generated from operating activities for the Period was $9.3 million compared to $9.1 million in the first quarter of 2024. The increase of $0.2 million was primarily due to an increase in Royalty Income and Distribution Income of $0.5 million, partially offset by a decrease in changes in working capital of $0.3 million.
The Fund generated Distributable Cash of $7.3 million for the Period compared to $7.3 million for the first quarter of 2024. The nominal increase in Distributable Cash of 0.1% was primarily due to an increase in cash flows generated from operating activities of $0.2 million, partially offset by specified investment flow-through tax ("SIFT Tax") on Units adjustment of $0.1 million.
The Fund generated Distributable Cash per Unit of $0.344 for the Period, unchanged compared to the first quarter of 2024.
The Fund's Payout Ratio for the Period was 100.2% compared to 96.8% in the first quarter of 2024. The increase in the Fund's Payout Ratio for the Period was due to distributions paid increasing by $0.3 million or 3.6%, partially offset by Distributable Cash increasing by a nominal amount or 0.1%. Payout Ratio is calculated by dividing the amount of distributions paid during the applicable period by the Distributable Cash for that period. The Fund's Payout Ratio fluctuates quarter-to-quarter depending upon the amount of distributions paid during a quarter and the amount of Distributable Cash generated during that quarter. On a trailing 12-month basis, the Fund's Payout Ratio was 100.7% as at March 31, 2025.
DISTRIBUTIONS
During the Period, the Fund declared distributions on the Units in the aggregate amount of $4.9 million or $0.230 per Unit. During the first quarter of 2024, the Fund declared distributions on the Units in the aggregate amount of $4.8 million or $0.226 per Unit. During the Period, the Fund paid distributions on the Units in the aggregate amount of $7.3 million or $0.345 per Unit. During the first quarter of 2024, the Fund paid distributions on the Units in the aggregate amount of $7.1 million or $0.333 per Unit. The amount of distributions declared during the Period increased by $0.1 million or $0.004 per Unit due to the monthly distribution rate increasing from $0.113 per Unit to $0.115 per Unit commencing with the November 2024 distribution (the " November 2024 Distribution Increase"). The amount of distributions paid during the Period increased by $0.3 million or $0.012 per Unit due to the monthly distribution rate increasing from $0.107 per Unit to $0.113 per Unit commencing with the January 2024 distribution and the November 2024 Distribution Increase.
The Fund pays distributions on the Units in respect of any calendar month not later than the last business day of the immediately subsequent month. Consequently, monthly distributions payable by the Fund on the Units in respect of the Period were the January 2025 distribution (which was paid on February 28, 2025), the February 2025 distribution (which was paid on March 31, 2025), and the March 2025 distribution (which was paid on April 30, 2025). Similarly, the distributions payable by the Fund on the Units in respect of any other period are paid in the immediately subsequent month of such period.
On May 8, 2025, the trustees of the Fund declared a distribution for the period of April 1, 2025 to April 30, 2025 of $0.115 per Unit, which will be payable on May 30, 2025 to Unitholders of record on May 21, 2025. Including the April 2025 distribution, which will be paid on May 30, 2025, the Fund will have paid out total distributions of $463.1 million or $27.91 per Unit, which includes 268 monthly distributions and three special distributions.
FINANCIAL SUMMARY
The tables below set out selected information from the Fund's unaudited condensed consolidated interim financial statements together with other data and should be read in conjunction with the unaudited condensed consolidated interim financial statements and MD&A of the Fund for the three-month periods ended March 31, 2025 and March 31, 2024, and the Fund's audited annual consolidated financial statements for the year-ended December 31, 2024.
For the periods ended March 31
Q1 2025
Q1 2024
(in thousands of dollars – except restaurants, SRS, Payout Ratio and per Unit items)
Number of restaurants in Royalty Pool
372
372
Franchise Sales reported by restaurants in the Royalty Pool
231,142
222,032
Royalty Income
9,246
8,881
Distribution Income
3,036
2,919
Total revenue
12,282
11,800
Administrative expenses
(409)
(436)
Interest expense on debt and financing fees
(834)
(828)
Interest expense on Class B Unit liability
(730)
(729)
Interest income
47
66
Profit before fair value (loss) gain and income taxes
10,356
9,873
Fair value (loss) gain on investment in BP Canada LP (defined below)
(1,910)
2,128
Fair value gain (loss) on Class B Unit liability
851
(948)
Fair value (loss) gain on Swaps
(703)
188
Current and deferred income tax expense
(2,247)
(2,774)
Net and comprehensive income
6,347
8,467
Basic earnings per Unit
0.30
0.40
Diluted earnings per Unit
0.21
0.37
Distributable Cash / Distributions / Payout Ratio
Cash flows generated from operating activities
9,265
9,100
BPI Class B Unit entitlement 8
(1,076)
(1,072)
Interest paid on debt
(830)
(808)
Current income tax expense
(2,506)
(2,365)
Current income tax paid
2,473
2,462
Distributable Cash
7,326
7,317
Distributions paid
7,341
7,086
Payout Ratio
100.2 %
96.8 %
Distributable Cash per Unit
0.344
0.344
Distributions paid per Unit
0.345
0.333
Other
Same Restaurant Sales
4.4 %
(1.0 %)
Number of restaurants opened
0
1
Number of restaurants closed
0
3
Mar 31, 2025
Dec 31, 2024
Total assets
420,750
422,888
Total liabilities
139,074
142,665
SUMMARY OF QUARTERLY RESULTS
Q1 2025
Q4 2024
Q3 2024
Q2 2024
(in thousands of dollars – except restaurants, SRS, Payout Ratio and per Unit items)
Number of restaurants in Royalty Pool
372
372
372
372
Franchise Sales reported by restaurants in the Royalty Pool
231,142
234,215
238,613
236,792
Royalty Income
9,246
9,369
9,544
9,472
Distribution Income
3,036
3,077
3,135
3,111
Total revenue
12,282
12,446
12,679
12,583
Administrative expenses
(409)
(401)
(379)
(497)
Interest expense on debt and financing fees
(834)
(870)
(887)
(932)
Interest expense on Class B Unit liability
(730)
(1,681)
(1,033)
(1,063)
Interest income
47
68
71
69
Profit before fair value (loss) gain and income taxes
10,356
9,562
10,451
10,160
Fair value (loss) gain on investment in BP Canada LP
(1,910)
(382)
8,511
1,473
Fair value gain (loss) on Class B Unit liability
851
170
(3,792)
(656)
Fair value loss on Swaps
(703)
(200)
(1,923)
(672)
Current and deferred income tax expense
(2,247)
(2,593)
(3,863)
(2,841)
Net and comprehensive income
6,347
6,557
9,384
7,464
Basic earnings per Unit
0.30
0.31
0.44
0.35
Diluted earnings per Unit
0.21
0.28
0.44
0.33
Distributable Cash / Distributions / Payout Ratio
Cash flows generated from operating activities
9,265
9,419
9,990
9,613
BPI Class B Unit entitlement
(1,076)
(1,097)
(1,195)
(1,095)
Interest paid on debt
(830)
(840)
(758)
(871)
Current income tax expense
(2,506)
(2,523)
(2,584)
(2,521)
Current income tax paid
2,473
2,520
2,660
2,370
Distributable Cash
7,326
7,479
8,113
7,496
Distributions paid
7,341
8,852
7,214
7,213
Payout Ratio
100.2 %
118.4 %
88.9 %
96.2 %
Distributable Cash per Unit
0.344
0.351
0.381
0.352
Distributions paid per Unit
0.345
0.416
0.339
0.339
Other
Same Restaurant Sales
4.4 %
3.4 %
(0.6 %)
1.7 %
Number of restaurants opened
0
2
0
1
Number of restaurants closed
0
0
1
0
SUMMARY OF QUARTERLY RESULTS (continued)
Q1 2024
Q4 2023
Q3 2023
Q2 2023
(in thousands of dollars – except restaurants, SRS, Payout Ratio and per Unit items)
Number of restaurants in Royalty Pool
372
377
377
377
Franchise Sales reported by restaurants in the Royalty Pool
222,032
227,665
240,139
233,650
Royalty Income
8,881
9,106
9,606
9,346
Distribution Income
2,919
2,992
3,155
3,071
Total revenue
11,800
12,098
12,761
12,417
Administrative expenses
(436)
(347)
(350)
(401)
Interest expense on debt and financing fees
(828)
(839)
(838)
(843)
Interest expense on Class B Unit liability
(729)
(1,321)
(1,055)
(982)
Interest income
66
57
72
79
Profit before fair value gain (loss) and income taxes
9,873
9,648
10,590
10,270
Fair value gain (loss) on investment in BP Canada LP
2,128
928
(7,857)
8,511
Fair value (loss) gain on Class B Unit liability
(948)
(414)
3,501
(3,792)
Fair value gain (loss) on Swaps
188
(2,250)
333
1,373
Current and deferred income tax expense
(2,774)
(2,695)
(1,673)
(3,576)
Net and comprehensive income
8,467
5,217
4,894
12,786
Basic earnings per Unit
0.40
0.25
0.23
0.59
Diluted earnings per Unit
0.37
0.24
0.06
0.59
Distributable Cash / Distributions / Payout Ratio
Cash flows generated from operating activities
9,100
9,288
9,659
9,759
BPI Class B Unit entitlement
(1,072)
(1,081)
(740)
(1,006)
Interest paid on debt
(808)
(817)
(825)
(848)
Current income tax expense
(2,365)
(2,445)
(2,603)
(2,511)
Current income tax paid
2,462
2,424
2,770
2,456
Distributable Cash
7,317
7,369
8,261
7,850
Distributions paid
7,086
6,830
6,848
6,909
Payout Ratio
96.8 %
92.7 %
82.9 %
88.0 %
Distributable Cash per Unit
0.344
0.346
0.387
0.365
Distributions paid per Unit
0.333
0.321
0.321
0.321
Other
Same Restaurant Sales
(1.0 %)
0.6 %
5.3 %
6.6 %
Number of restaurants opened
1
1
0
0
Number of restaurants closed
3
4
0
1
SHORT-TERM OUTLOOK
The success of the Fund, BPI, Boston Pizza Canada Limited Partnership (" BP Canada LP"), and Boston Pizza restaurants, including the amount of Franchise Sales, Royalty Income, Distribution Income, and Distributable Cash available for distribution to Unitholders, depends on both consumer demand and restaurant-level operations. Consumer demand is driven by consumer confidence and discretionary spending, both of which are influenced by macroeconomic factors such as inflation and interest rates, wage growth and unemployment levels, recession risks, competition within the restaurant industry, evolving consumer preferences, changes in taxation and major geopolitical developments, including tariffs. At the restaurant level, success is also impacted by supply chain disruptions, labor availability, rising input costs, and other operational challenges.
The escalating trade tensions between Canada and the United States of America, including the imposition of tariffs and counter-tariffs, have created uncertainty and concern for Canada's macroeconomic outlook. The effects of these escalating trade tensions and associated uncertainty have the potential to increase input costs and decrease availability of goods for Boston Pizza restaurants, together with dampening consumer demand, confidence, and discretionary spending, and increasing unemployment rates. These dynamics can contribute to broader economic contractions or recessionary conditions that directly adversely affect the performance of consumer-facing industries like casual dining.
However, Boston Pizza's supply chain is currently well positioned to weather the volatility caused by trade tensions and threats of tariffs and counter-tariffs as the overwhelming majority of raw materials purchased by Boston Pizza restaurants in the day-to-day operation of their businesses are sourced within Canada and not subject to counter-tariffs. In addition, the trade tensions with the United States of America may result in Canadian consumers spending less on travel to the United States of America and more on supporting Canadian brands like Boston Pizza. Conversely, any degradation of consumer demand, confidence or discretionary spending, or increases in unemployment rates and recessionary fears may result in reduced guest visitation, average guest cheque amounts, Franchise Sales, Royalty Income, Distribution Income, the Fund's Distributable Cash available for distribution to Unitholders, and profitability of Boston Pizza restaurants, all of which would increase the risk of Boston Pizza restaurants closing.
Despite these obstacles, Boston Pizza restaurants have consistently generated strong Franchise Sales by providing guests with appealing dining options that emphasize quality, value, and convenience, both on-premise and off-premise. BPI, BP Canada LP, and Boston Pizza restaurants have demonstrated adaptability in navigating changing economic conditions and challenging operating environments. BPI's management remains proactive and committed to adjusting its business strategy to effectively address these challenges and sustain positive sales momentum in 2025.
The trustees of the Fund will continue to closely monitor the Fund's available cash balances and distribution levels to maintain a stable and sustainable return for the Unitholders.
BPI DISCLOSURES
The financial information relating to BPI (the " BPI Financial Information") contained in this press release has been derived from the financial statements and management's discussion and analysis of BPI (the " BPI Disclosures"), which have been filed by the Fund on behalf of BPI pursuant to an undertaking dated July 9, 2002 provided by BPI to the various securities commissions in Canada. BPI's senior management prepares the BPI Disclosures and provides them to the Fund for filing. The auditors of BPI report to the sole shareholder of BPI, and not to the trustees or Unitholders of the Fund. The Fund does not own, control, or consolidate BPI and therefore, the Fund's disclosure controls and procedures and its internal controls over financial reporting do not encompass BPI or BPI's internal controls over financial reporting. The BPI Disclosures are the responsibility of BPI and its directors and officers and not the Fund and its trustees and officers. The Fund provides no assurances as to its accuracy or completeness. The Fund disclaims any and all liability for the BPI Financial Information.
Forward Looking Information
Certain information in this press release constitutes "forward-looking information" that involves known and unknown risks, uncertainties, future expectations and other factors which may cause the actual results, performance or achievements of the Fund, Boston Pizza Holdings Trust, Boston Pizza Royalties Limited Partnership, Boston Pizza Holdings Limited Partnership, Boston Pizza Holdings GP Inc., Boston Pizza GP Inc., BPI, BP Canada LP, Boston Pizza Canada Holdings Inc., Boston Pizza Canada Holdings Partnership, Boston Pizza restaurants, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Fund or its trustees expect or anticipate will or may occur in the future, including such things as, our expectation of an increasingly complex economic environment in the quarters ahead, the potential impact on Boston Pizza Restaurants in Canada and adapting the business accordingly, our continued focus on enhancing guest experiences, supporting our franchisees, and driving sustainable long-term growth through innovation and operational excellence, the success of BPI, BP Canada LP and Boston Pizza restaurants, and the amount of Franchise Sales, Royalty Income, Distribution Income and Distributable Cash available for distribution to Unitholders, depending on both consumer demand and restaurant-level operations, consumer demand being driven by consumer confidence and discretionary spending, both of which are influenced by macroeconomic factors such as inflation and interest rates, wage growth and unemployment levels, recession risks, competition within the restaurant industry, evolving consumer preferences, changes in taxation and major geopolitical developments, including tariffs, restaurant-level success being impacted by supply chain disruptions, labor availability, rising input costs, and other operational challenges, increased input costs and decreased availability of goods for Boston Pizza restaurants due to escalating trade tensions and associated uncertainty, dampening consumer demand, confidence and discretionary spending, and increasing unemployment rates, Boston Pizza's supply chain being well positioned to weather the volatility caused by trade tensions and threats of tariffs and counter-tariffs as an overwhelming majority of raw materials purchased by Boston Pizza restaurants in the day-to-day operation of their businesses are sourced within Canada and not subject to counter-tariffs, trade tensions with the United States of America resulting in Canadian consumers spending less on travel to the United States of America and more on supporting Canadian brands like Boston Pizza, the impact of broader economic contractions or recessionary conditions on consumer-facing industries, BPI's management remaining proactive and committed to adjusting its business strategy to effectively address challenges and sustain positive sales momentum in 2025, the trustees of the Fund continuing to closely monitor the Fund's available cash balances and distribution levels to maintain a stable and sustainable return for the Unitholders, and other such matters are forward-looking information. When used in this press release, forward-looking information may include words such as "anticipate", "estimate", "may", "will", "expect", "believe", "plan", "should", "continue" and other similar terminology. The material factors and assumptions used to develop the forward-looking information contained in this press release include the following: the Fund maintaining the same distribution policy, expectations related to future general economic conditions and geopolitical developments, expectations related to guest traffic and average guest cheques, expectations related to the resiliency of the Boston Pizza system, the impact of and response to changing competitive landscapes and guest behaviours, strategies and efforts to strive for profitability of BPI, BP Canada LP and Boston Pizza Restaurants, ability to maintain a stable supply chain, ability to attract and retain qualified employees, key personnel and qualified franchisees and operators, and Boston Pizza restaurants maintaining operational excellence. Risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievement expressed or implied by the forward-looking information contained herein, relate to (among others): competition, demographic trends, business and economic conditions, interest rates and inflationary pressures, legislation and regulation, reliance on operating revenues, financial reporting and accounting controls, policies and practices, the results of operations and financial condition of BPI, BP Canada LP and the Fund, labour availability, cost and efficiency, extreme weather events, as well as those factors discussed under the heading "Risks and Uncertainties" in the most recent Annual Information Form of the Fund. This information reflects current expectations regarding future events and operating performance and speaks only as of the date of this press release. Except as required by law, neither the Fund nor BPI assumes any obligation to update previously disclosed forward-looking information. For a complete list of the risks associated with forward-looking information and the Fund's business, please refer to the "Risks and Uncertainties" and "Note Regarding Forward-Looking Information" sections included in the most recent Annual Information Form of the Fund available at www.sedarplus.ca and www.bpincomefund.com.
The trustees of the Fund have approved the contents of this news release.
_________________________
Notes – Non-GAAP, Specified Financial Measures and Other Information
1
" Franchise Sales" is the basis upon which Royalty Income and Distribution Income are payable, and means the gross revenue: (i) of the corporate Boston Pizza restaurants in Canada owned by BPI that are in the Royalty Pool; and (ii) reported to BP Canada LP by franchised Boston Pizza restaurants in Canada that are in the Royalty Pool, without audit or other form of independent assurance, and in the case of both (i) and (ii), after deducting revenue from the sale of liquor, beer, wine and revenue from BP Canada LP approved national promotions and discounts and excluding applicable sales and similar taxes. Nevertheless, BP Canada LP periodically conducts audits of the Franchise Sales reported to it by its franchisees, and the Franchise Sales reported herein include results from sales audits of earlier periods. Franchise Sales is reported on a quarterly basis in the Fund's financial statements, however, the financial statements do not report it on a monthly basis.
2
" Same Restaurant Sales" or " SRS" is a supplementary financial measure under NI 52-112 and therefore may not be comparable to similar measures presented by other issuers. The Fund defines SRS as the change in Franchise Sales of Boston Pizza restaurants as compared to the Franchise Sales for the same period in the previous year (where restaurants were open for a minimum of 24 months). The Fund believes that SRS provides Unitholders meaningful information regarding the performance of Boston Pizza restaurants.
3
" Distributable Cash" is a non-GAAP financial measure under NI 52-112. Distributable Cash is not a standardized financial measure under IFRS and may not be comparable to similar financial measures disclosed by other issuers. The Fund defines Distributable Cash to be, in respect of any particular period, the Fund's cash flows generated from operating activities for that period (being the most comparable financial measure in the Fund's primary financial statements) minus (a) BPI's entitlement in respect of its Class B general partner units (" Class B Units") of Royalties LP (defined below) in respect of the period (see note 8 below), minus (b) interest paid on long-term debt during the period, minus (c) principal repayments on long-term debt that are contractually required to be made during the period, minus (d) the current income tax expense in respect of the period, plus (e) current income tax paid during the period (the sum of (d) and (e) being " SIFT Tax on Units"). Management believes that Distributable Cash provides investors with useful information about the amount of cash the Fund has generated and has available for distribution on the Units in respect of any period. The tables in the "Financial Highlights" section of this press release provide a reconciliation from this non-GAAP financial measure to cash flows generated from operating activities, which is the most directly comparable IFRS measure. Current income tax expense in respect of any period is prepared using reasonable and supportable assumptions (including that the base rate of SIFT Tax will not increase throughout the calendar year and that certain expenses of the Fund will continue to be deductible for income tax purposes), all of which reflect the Fund's planned courses of action given management's judgment about the most probable set of economic conditions. There is a risk that the federal government of Canada could increase the base rate of SIFT Tax or that applicable taxation authorities could assess the Fund on the basis that certain expenses of the Fund are not deductible. Investors are cautioned that if either of these possibilities occurs, then the actual results for this component of Distributable Cash may vary, perhaps materially, from the amounts used in the reconciliation.
4
" Distributable Cash per Unit" is a non-GAAP ratio under NI 52-112. Distributable Cash per Unit is not a standardized financial measure under IFRS and may not be comparable to similar financial measures disclosed by other issuers. The Fund defines Distributable Cash per Unit for any period as the Distributable Cash generated in that period divided by the weighted average number of Units outstanding during that period. Management believes that Distributable Cash per Unit provides investors with useful information regarding the amount of cash per Unit that the Fund has generated and has available for distribution in respect of any period.
5
" Payout Ratio" is a non-GAAP ratio under NI 52-112. Payout Ratio is not a standardized financial measure under IFRS and may not be comparable to similar financial measures disclosed by other issuers. The Fund defines Payout Ratio for any period as the aggregate distributions paid by the Fund during that period divided by the Distributable Cash generated in that period. Management believes that Payout Ratio provides investors with useful information regarding the extent to which the Fund distributes cash generated on Units.
6
Boston Pizza Royalties Limited Partnership (" Royalties LP") licenses BPI the right to use various Boston Pizza trademarks in return for BPI paying Boston Pizza Royalties Limited Partnership a royalty equal to 4% of Franchise Sales of Boston Pizza restaurants (the " Royalty Income") in the Fund's royalty pool (the " Royalty Pool").
7
" Distribution Income" is income received indirectly by the Fund on Class 1 LP Units and Class 2 LP Units of BP Canada LP. See the "Overview – Purpose of the Fund / Sources of Revenue" section of the Fund's MD&A for the Period for more details.
8
" BPI Class B Unit entitlement" is a supplementary financial measure under NI 52-112 and therefore may not be comparable to similar measures presented by other issuers. The BPI Class B Unit entitlement is the interest expense on Class B Units in respect of a period plus management's estimate of how much cash BPI would be entitled to receive pursuant to the limited partnership agreement governing Royalties LP (a copy of which is available on www.sedarplus.ca) on its Class B Units if Royalties LP fully distributed any residual cash generated in respect of that period after the Fund pays interest on long-term debt, principal repayments on long-term debt and SIFT Tax on Units in respect of that period. Management believes that the BPI Class B Unit entitlement is an important component in calculating Distributable Cash since it represents the amount of residual cash generated that BPI would be entitled to receive and therefore would not be available for distribution to Unitholders. Management prepares such estimate using reasonable and supportable assumptions that reflect the Fund's planned courses of action given management's judgment about the most probable set of economic conditions.