Pizza Pizza Royalty (PZA) Q1 2025 earnings summary

Executive summary

• Achieved 1.2% same-store sales growth in Q1 2025, with Pizza Pizza at 0.6% and Pizza 73 at 4.3%, supported by increased guest traffic, higher average check, and menu innovation.

• Royalty Pool System Sales increased 1.6% to CAD 151.3 million year-over-year.

• Adjusted earnings per share remained flat at CAD 0.230, while basic EPS decreased 0.9% to CAD 0.233.

• Restaurant network expanded with 20 net new restaurants, totaling 794–797 locations.

• Continued innovation in menu and marketing, including new product launches and custom promotions.

Financial highlights

• Royalty income increased to CAD 9.7 million.

• Dividends declared totaled CAD 5.7 million (CAD 0.2325 per share), unchanged from the prior year.

• Adjusted earnings available for shareholder dividends were CAD 4.9 million, up from CAD 4.7 million in Q1 2024.

• Q1 payout ratio was 117%, reducing the working capital reserve by CAD 900,000 to CAD 5.2 million.

• System Sales: Pizza Pizza reported CAD 129.8 million (+1.2%), Pizza 73 reported CAD 21.5 million (+4.3%).

Outlook and guidance

• Management anticipates 2%-3% traditional restaurant network growth and continued renovations in the second half of 2025.

• Dividend policy is to distribute all available cash after reasonable reserves, with monthly payments to smooth income.

• Expects continued competition for consumer spending due to economic and tariff pressures.

• Ongoing investment in technology to enhance customer engagement and order frequency.