The current monthly distribution is $0.133 per unit per month which equates to an annualized rate of $1.596 per unit. Distributions are paid on the last business day of each month. Click here to view recent distributions.
Distributions are taxed as non-eligible dividends. Click here for 2016 Tax Information.
The income reported on the 2016 T3s provided to unitholders of record on December 31, 2016 includes the distribution of 13.3 cents per unit for the period December 1 to 31, 2016. As distributions are paid monthly in arrears, this distribution of December's income was paid on January 31, 2017.
The ability to increase distributions depends on the same store sales growth of the restaurants in the royalty pool and management of the Fund's general and administrative expenses, as well as the accretion from the royalties of the new restaurants added to the pool each January.
We do not provide estimates of future sales. 2016 gross sales for the 838 A&W restaurants in the royalty pool during 2016 were $1,138 million. On January 5, 2017, the number of A&W restaurants for which royalties are paid was increased by 30 new restaurants less 7 restaurants which permanently closed during 2016, bringing the total number of restaurants in the royalty pool to 861.
There are no management fees charged by Food Services; however the Fund and Trade Marks incur general and administrative costs, as well as interest on a $60 million term loan.
Once per year, the Fund (through Trade Marks and the Partnership) will purchase the royalty stream from new restaurants opened by A&W Food Services of Canada Inc. (Food Services) in the prior year, net of the royalty stream of any A&W restaurants that have closed. The Partnership will pay Food Services, in the form of securities that are exchangeable for units of the Fund, 92.5% of an amount that is based on the royalty stream from the net new restaurants and the yield on the units of the Fund. The formula is designed to be accretive to unitholders. In 2016 royalties were based on 838 restaurants in the royalty pool. On January 5, 2017, the number of A&W restaurants for which royalties are paid was increased by 30 new restaurants less 7 restaurants which permanently closed during 2016, bringing the total number of restaurants in the royalty pool to 861.
Distributable cash is a common term used by income funds to describe the amount of cash that is available to meet distribution obligations of the Fund. Distributable cash is calculated as the operating cash flows of the Fund, adjusted for changes in non-cash working capital.
Effective March 3, 2017, Food Services owns the equivalent of 21.2% of the units of the Fund on a fully diluted basis.
The number of restaurant openings and closings will vary between Food Services and the Fund, as the period for which they are calculated varies slightly.
The royalty pool is adjusted in January of each year to include the revenue stream from restaurants which opened in the 12-month period ending September of the prior year. For example, on January 5, 2017, the number of restaurants for which royalties were paid to the Fund was increased by 30 new restaurants which opened prior to September 2016, less 7 restaurants which permanently closed during 2016. Restaurants that opened after September 2016 will not be included in the royalty pool until January 2018. Therefore at any given time there are A&W restaurants which are not in the royalty pool.
Units are traded on the Toronto Stock Exchange under the symbol AW.UN. There are currently 12,504,673 units outstanding. To purchase units, contact any Canadian brokerage firm.
No, but your brokerage firm may offer a feature simillar to a DRIP which allows investors to rollover monthly cash distributions for additional Fund units.
Share certificates are not issued for the units.
For more information about the A&W Revenue Royalties Income Fund, please contact:
A&W Revenue Royalties Income Fund
#300 - 171 West Esplanade
North Vancouver, BC V7M 3K9
Phone: (604) 988-2141
Fax: (604) 988-5531