Vancouver-based A&W Revenue Royalties Income Fund (TSX:AW.UN) reported its second quarter results yesterday and boasted a 5.7% increase in royalty income to $5.6 million over the same period in 2010.
In a release, the company said same-store sales growth of 3.4% in the second quarter marked a return to A&W's historical growth levels.
Same-store sales are the most important driver of growth in the fund, A&W noted. The increases erased the negative results of the first quarter caused by poor weather.
Paul Hollands, president and CEO of A&W Food Services of Canada Inc., said, “As a strategy-driven company, we continue to focus on the increasing demand for premium hamburgers… and on accelerating the pace of growth of new restaurants.
“Despite continuing uncertain economic conditions, we are pleased that the A&W business demonstrated solid growth in the second quarter. Looking forward, we will continue to focus on strategic goals, but we will also continue to introduce advertising and promotional programs to respond to economic conditions.”
Total sales reported by restaurants in the royalty pool increased by 5.7% to $187.8 million in the second quarter of 2011, compared to $177.7 million in the same quarter of 2010.
The higher sales resulted from an increase in the number of restaurants in the pool from 700 to 715, as well as same-store sales growth.
At yesterday’s close, the fund was trading up $0.19 at $19.68.
Jennifer Harrison