SIR Royalty Income Fund to Resume Unitholder Distributions as Business Outlook Improves
̶ Fund Trustees appoint William Rogers as Chair and reconstitute Committees ̶
BURLINGTON, ON, July 15, 2021 /CNW/ - SIR Royalty Income Fund (TSX: SRV.UN) (the "Fund") today announced that the Trustees of the Fund have approved the resumption of monthly unitholder distributions effective July 30, 2021. The initial monthly distribution under the resumption will be in the amount of $0.07 per Fund Unit and will payable on July 30, 2021 to unitholders of record on July 22, 2021 and will be funded by a combination of the royalty payment for SIR Corp.'s ("SIR") four-week operating period ended July 4, 2021, recent interest on the SIR Loan and a portion of the $1.0 million payment from SIR that was paid in April 2021 for previously deferred royalties and interest of the SIR Loan. The Fund also announced the appointment of William (Bill) Rogers as Chair of the Board of Trustees and reconstitutes its committees.
"With the continued easing of pandemic-related operating restrictions across Canada, we look forward to gradually returning to a more normalized operating environment as we welcome our guests back for in-restaurant dining at all of our locations, while continuing to adhere to strict health and safety protocols," said Peter Fowler, CEO of SIR Corp. "We are grateful for the support we have received from the Fund, our business partners and government programs throughout this difficult period. The pandemic has been the greatest challenge that SIR has faced and the Fund's unitholders have also been impacted. We thank the Fund's unitholders for their ongoing support and we look forward to ongoing unitholder distributions as SIR's operations continue to ramp up."
"The Fund Trustees will continue to monitor the Fund's distributable cash as sales of SIR and the resulting royalty payment increase as business restrictions on restaurants are reduced or removed, with a view to adjusting the level of unitholder distributions accordingly," said Bill Rogers, the newly-appointed Chair of the Fund. "We anticipate being able to increase distributions over time as revenues from the SIR restaurants recover, provided that restaurant dining rooms in Ontario are permitted to commence re-opening starting July 16, 2021 and remain open thereafter. The Fund expects that SIR will have repaid all previously deferred royalties and interest on the SIR Loan by July 6, 2022."
The Fund has appointed the following Trustees to its Audit Committee: Stephen Dewis (Chair), Michael Fisher and Norm Mayr. The following Trustees have been appointed to the Corporate Governance Committee of SIR GP Inc.: Sandra Levy (Chair), Lembit Janes and William Rogers.
SIR Corp. suspended dine-in operations beginning on March 16, 2020 at all of its restaurants and bars in accordance with the directives of public health authorities due to the COVID-19 pandemic. As a result of the closure of SIR's dine-in operations, the Trustees of the Fund announced the suspension of unitholder distributions until further notice on March 23, 2020. Reduced services and restaurant closures resulted in material declines to sales at SIR restaurants throughout the pandemic. SIR was particularly impacted by the pandemic as the majority of its restaurants are located in the Greater Toronto Area, a jurisdiction that had some of the most prohibitive restaurant operating restrictions in North America.
About SIR Royalty Income Fund
The Fund is a trust governed by the laws of the province of Ontario that receives distribution income from its investment in the SIR Royalty Limited Partnership and interest income from the SIR Loan. The Fund intends to pay distributions to unitholders on a monthly basis.
About SIR Corp.
SIR Corp. ("SIR") is a privately held Canadian corporation that owns a portfolio of 53 restaurants in Canada. SIR's Concept brands include: Jack Astor's Bar and Grill®, with 37 locations; Scaddabush Italian Kitchen & Bar® with nine locations; and Canyon Creek®, with two locations. SIR also operates one-of-a-kind "Signature" brands including Reds® Wine Tavern, Reds® Square One and The Loose Moose®. All trademarks related to the Concept and Signature brands noted above are used by SIR under a License and Royalty Agreement with SIR Royalty Limited Partnership. SIR also owns one Duke's Refresher® & Bar locations in downtown Toronto, and one seasonal Signature restaurant, Abbey's Bakehouse®, which are currently not in consideration to be part of the Royalty Pool. For more information on SIR Corp. or the SIR Royalty Income Fund, please visit www.sircorp.com.
Caution concerning forward-looking statements
Certain statements contained in this report, or incorporated herein by reference, including the information set forth as to the future financial or operating performance of the Fund or SIR Corp. ("SIR Corp." or the "Corporation"), that are not current or historical factual statements may constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). Statements concerning the objectives, goals, strategies, intentions, plans, beliefs, expectations and estimates, and the business, operations, financial performance and condition of the Fund, SIR Holdings Trust (the "Trust"), SIR Royalty Limited Partnership (the "Partnership"), SIR Corp. or industry results, are forward-looking statements. The words "may", "will", "should", "could", "would", "expect", "believe", "plan", "anticipate", "intend", "estimate" and other similar terminology and the negative of such expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Fund, the Trust, the Partnership, SIR Corp. or industry results to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. These statements reflect SIR Corp. management's ("Management") current expectations, estimates and projections regarding future events and operating performance and are based on information currently available to Management, Management's historical experience, perception of trends and current business conditions, expected future developments and other factors which management considers appropriate. The forward-looking statements speak only as of the date hereof. Readers should not place undue importance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur, and readers should not rely upon this information as of any other date. By their nature, forward-looking statements involve known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated by such statements. Risks related to forward-looking statements include, among other things, challenges presented by a number of factors, including, without limitation: the impact of the COVID-19 pandemic, including a worsening of the COVID-19 pandemic, changes in governmental or customer responses to the COVID-19 outbreak, continued availability of required employees, business interruptions, access to restaurant locations and access to needed supplies and capital; market conditions; competition; changes in demographic trends; weather; changing consumer preferences and discretionary spending patterns; changes in consumer confidence; changes in national and local business and economic conditions; pandemics or other material outbreaks of disease or safety issues affecting humans or animals or food products; changes in tariffs and international trade; changes in foreign exchange or interest rates; changes in availability of credit; legal proceedings and challenges to intellectual property rights; dependence of the Fund on the financial condition of SIR Corp.; legislation and governmental regulation, including the cost and/or availability of labour as it relates to changes in minimum wage rates or other changes to labour legislation and forced closures of restaurants and bars; changes in laws affecting the sale and use of alcohol (including availability and enforcement); changes in cannabis laws; changes in tax laws; changes in accounting policies and practices; and the results of operations and financial condition of SIR Corp. The foregoing list of factors is not exhaustive. Many of these issues can affect the Fund's or SIR Corp.'s actual results and could cause their actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Fund or SIR Corp. There can be no assurance that SIR Corp. will remain compliant in the future with all of its financial covenants under the Credit Agreement (as defined herein) and otherwise, particularly amid the COVID-19 outbreak. Given these uncertainties, readers are cautioned that forward-looking statements are not guarantees of future performance and should not place undue reliance on them. The Fund and SIR Corp. expressly disclaim any obligation or undertaking to publicly disclose or release any updates or revisions to any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are based on Management's current plans, estimates, projections, beliefs and opinions, and the Fund and SIR Corp. do not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change, except as expressly required by applicable securities laws.
In formulating the forward-looking statements contained herein, Management has assumed that its businesses will be able to continue to operate following the resolution of the COVID-19 pandemic and that business and economic conditions affecting SIR Corp.'s restaurants and the Fund will return to normalcy within the medium term. However, the continuation or escalation of this public health crisis could create adverse impacts on the Fund's and SIR Corp.'s workforce, supply chain and customer access and could reduce revenue for the Fund and SIR Corp., which could have a material adverse effect on SIR Corp.'s business, financial condition and results of operations. Management has also assumed that SIR Corp. will remain compliant in the future with, or receive waivers from, all of its financial covenants under the Credit Agreement and otherwise. These assumptions, although considered reasonable by Management at the time of preparation, may prove to be incorrect. For more information concerning the Fund's risks and uncertainties, please refer to the Fund's annual information form dated March 31, 2021 for the period ended December 31, 2020, which is available under the Fund's profile at www.sedar.com.
All of the forward-looking statements made herein are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Fund or SIR Corp. In particular, there can be no assurance that restaurants will be able to reopen for indoor or patio dining or remain open as currently anticipated, or that current or deferred royalty payments will be able to be made as currently anticipated. See "Risk Factors" in the Fund's annual information form dated March 31, 2021 for the period ended December 31, 2020.
SOURCE SIR Royalty Income Fund
Company Codes: Toronto:SRV.UN
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