Boston Pizza Royalties Income Fund TSE: BPF.UN reported higher first-quarter franchise sales and distributable cash as Boston Pizza International said promotional activity and guest traffic supported results across its restaurant network.
On a May 13 conference call, Jordan Holm, president of Boston Pizza International, said franchise sales from restaurants in the royalty pool totaled CAD 238.4 million in the first quarter of 2026, up 3.1% from the same period a year earlier. Same-restaurant sales also increased 3.1%, which Holm said was mainly driven by higher guest traffic, sustained momentum in takeout and delivery, and promotional initiatives.
“Our continued performance, in spite of continued trade tensions and increasingly uncertain global backdrop, demonstrates the resilience and strength of our business and the Boston Pizza brand,” Holm said.
Promotions Help Drive First-Quarter Traffic
Holm said Boston Pizza began the year with its Pasta Tuesday all-month-long promotion in January, offering pastas every day of the week starting at CAD 11.99, with gourmet pastas available for CAD 15.99. The company also partnered with Pepsi on a promotion offering guests a chance to win NFL-related prizes.
Boston Pizza also held its annual Valentine’s Day heart-shaped pizza campaign. Holm said CAD 1 from every pizza sold on Feb. 14 was donated to support local charities, raising approximately CAD 650,000 for the Boston Pizza Foundation and local charities.
No new restaurants opened during the quarter, while two restaurants closed and 11 underwent renovations. During the question-and-answer portion of the call, Holm said the two closed locations were in Western Canada: one in the B.C. Lower Mainland and one in the Edmonton area. He said the Edmonton closure related to a redevelopment site, while the B.C. location had “a mix of issues.”
Holm said closures are sometimes part of the life cycle for a restaurant group of Boston Pizza’s size, adding that the company expects to capture a portion of the sales from those locations at nearby Boston Pizza restaurants.
Royalty Income and Distributable Cash Rise
Michael Harbinson, chief financial officer of Boston Pizza International, said the fund generated royalty income of CAD 9.5 million in the first quarter, compared with CAD 9.2 million a year earlier. Distribution income was CAD 3.1 million, compared with CAD 3.0 million in the prior-year period.
Both royalty income and distribution income were based on 372 Boston Pizza restaurants in the royalty pool. Those restaurants reported CAD 238.4 million in franchise sales during the quarter, compared with CAD 231.1 million from the same number of restaurants in the first quarter of 2025.
The fund reported net and comprehensive income of CAD 2.2 million, compared with CAD 6.3 million in the first quarter of 2025. Harbinson said management views net income and operating cash flow as less meaningful indicators of the fund’s ability to pay distributions because net income includes non-cash items and operating cash flow does not include all required cash outflows.
Distributable cash, a non-IFRS metric used by the fund, was CAD 7.5 million in the quarter, up from CAD 7.3 million a year earlier. Distributable cash per unit was CAD 0.354, compared with CAD 0.344 in the first quarter of 2025.
Payout Ratio and Distribution Increase
The fund’s payout ratio was 101.6% in the first quarter, compared with 100.2% a year earlier. On a trailing 12-month basis, the payout ratio was 102.2% as of March 31, 2026.
Harbinson said trustees increased the monthly distribution rate to CAD 0.124 per unit, beginning with the March 2026 distribution. The new rate represents an increase of CAD 0.004 per unit, or 3.3%, from the previous monthly distribution rate of CAD 0.12 per unit. On an annualized basis, the new rate equals CAD 1.488 per unit, up from CAD 1.44.
The March distribution was paid April 30 to unitholders of record as of April 21. Trustees also approved a CAD 0.124-per-unit distribution for April, payable May 29 to unitholders of record at the close of business on May 21.
Harbinson said the trustees’ objective is to set a sustainable monthly distribution amount and that they will continue to monitor cash balances given the uncertain economic outlook.
Development Pipeline and Renovations
In response to an analyst question from Nick Corcoran of Acumen Capital Partners, Holm said Boston Pizza has several development projects moving forward. He cited Revelstoke, British Columbia, where construction has started on a restaurant the company hopes to open later this year. He also mentioned projects in Dryden, Ontario, and The Pas, Manitoba, where permits have been obtained and construction is beginning as weather allows.
Holm said additional projects could open later in 2026 or in 2027, and that Boston Pizza’s development teams have identified underserved markets across the country for potential future locations.
On renovations, Holm said the company completed 11 in the first quarter after completing 40 full restaurant renovations in 2025. He said the company expects a similar number of renovations this year, possibly slightly more, depending on permitting, construction timelines and the ability to temporarily close restaurants for renovation work.
Outlook Focuses on Sports, Summer Promotions
Holm said Boston Pizza began the second quarter with a playoff promotion tied to hockey and basketball postseason activity. The campaign includes menu items such as the Philly Cheesesteak Pizza, The Most Valuable Platter and the Smokeshow Whisky Caesar, supported by national advertising under the “Feast Like a Hockey God” campaign.
In June, the company plans promotions tied to the World Cup of Soccer, as well as a summer campaign featuring a refreshed menu and another partnership with Live Nation Canada offering concert prizes and live music at Boston Pizza restaurants.
Holm said guest visitation remained encouraging into the start of the second quarter and has been the main contributor to year-over-year sales growth over the past six quarters. He said menu pricing has contributed as well, but Boston Pizza remains cautious on pricing as it seeks to maintain its position as an “affordable luxury” for Canadian consumers.
Holm also said the company is monitoring trade tensions, geopolitical developments and the conflict in the Middle East. He said the conflict has not yet caused material increases in restaurant input costs, though prolonged global supply-chain disruptions could increase costs in the future and affect discretionary consumer spending.
About Boston Pizza Royalties Income Fund TSE: BPF.UN
The Fund is a limited purpose open ended trust with an excellent track record for investors since its IPO in 2002. Including the December 2025 distribution which is payable on January 30, 2026, the Fund will have paid out 276 monthly distributions and four special distributions totaling $485.7 million or $28.97 per unit. The Fund earns revenue based on the franchise system sales of the 372 Boston Pizza restaurants in the Fund's royalty pool. Boston Pizza is the premier casual dining brand in Canada.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Before you consider Boston Pizza Royalties Income Fund, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Boston Pizza Royalties Income Fund wasn't on the list.
While Boston Pizza Royalties Income Fund currently has a Hold rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Enter your email address and we’ll send you MarketBeat’s list of ten stocks set to soar in Spring 2026, despite the threat of tariffs and what's happening in Iran. These ten stocks are incredibly resilient and are likely to thrive in any economic environment.
Get This Free Report
