The Keg Royalties Income Fund (TSX:KEG.UN) announced late last week that sales grew 3.1% to $111.2 million in the quarter ending June 30 but sales for the first half of 2010 declined 0.3% to $228.1 million compared with 2009.
The income fund’s net earnings grew 1.9% to $4.5 million in the quarter but decreased 1.2% to $9.2 million this year to date.
The fund receives 4% of system sales from the 102 Keg restaurants in the royalty pool. The fund is not affected by profits or losses posted by the David Aisenstat-owned Keg Restaurants Ltd. Instead, it generates revenue as a percentage of total sales.
Aisenstat said he is encouraged by his restaurants’ latest results for the quarter and is particularly pleased with relative same-store sales growth for Canada, where about 90% of his restaurants are located.
He expects his restaurants will continue this momentum as economic conditions improve.
BIV asked Aisenstat in May whether he was worried about a double-dip recession and potential fallout from a sluggish recovery in Europe.
“If I start worrying about stuff like that, I might as well just crawl in a hole and curl up,” he said. “Everybody should be concerned and aware about what’s happening. It’s an unfortunate thing that’s going on. But, it’s not a major factor in what we’re thinking of doing or what I think about every day.”