Good day, everyone, and welcome to today's A&W Revenue Royalties Income Fund Q1 2024 financial results. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing the star and one on your telephone keypad. You may withdraw yourself from the queue by pressing star two. Please note this call is being recorded, and I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Susan Senecal. Thank you, Shelby, and good afternoon, everyone. Thank you for taking the time to attend our call today. I'm Susan Senecal. I'm President and CEO of A&W Food Services of Canada and the A&W Revenue Royalties Income Fund. Unfortunately, Kelly Blankstein, who's the Chief Financial Officer of A&W Food Services and the fund, is unable to make the call today, but we have Lisa Marzocco, A&W's Director of Finance, who will be filling in. Today, we're presenting the fund's results for the first quarter ended March 24th, 2024. I'm pleased to report that A&W started off the year with positive growth, achieving royalty pool same-store sales growth of 0.6% in the first quarter the very first quarter, actually, of the implementation of our new strategy. A&W's mission is together to excite Canada's most avid burger lovers wherever they are with the best-tasting burgers they crave, earning even more of their visits, and making A&W restaurants even more successful. By maintaining focus on this mission and our strategy that was launched in the fall of 2023, A&W has been able to navigate challenging economic conditions such as increased interest rates and inflation, which have impacted consumer discretionary spending in Canada. In response to these economic conditions, we continue to seek new and innovative ways to offer A&W guests a delicious and affordable experience that will, in turn, increase guest traffic in our restaurants. Now I'll turn things over to Lisa, who will touch on the fund's structure and go through the financial results for the first quarter. Lisa? Thank you, Susan. Before we can tell you more about our results, I need to read the following comment on forward-looking information. "Certain statements in this presentation may be forward-looking in nature. These include statements with respect to plans to increase guest traffic, Food Services' ability to strengthen A&W's brand loyalty and positioning, and the timing for releasing the interim unaudited financial statements and MD&A of the fund. Actual results may differ from those expressed or implied in these forward-looking statements." The forward-looking statements contained in this presentation are subject to a number of risk factors, including the ability of A&W Food Services to implement its strategies as planned, general economic and business conditions, financial and political instability, international conflict, and other factors disclosed previously and from time to time in the fund's public filings. Any forward-looking statements in this presentation should be evaluated in light of these important factors and, except as required by applicable securities laws, will not be updated if management's beliefs, estimates, or opinions or other factors should change. Now I'll speak to the fund's structure and then go through the financial results. After that, Susan will provide an update on A&W restaurants and some of A&W's key corporate developments. We will be happy to answer any questions at the end of our call. The fund is a top-line fund, meaning the distributable cash available to make distributions to unit holders is based on the sales of the restaurants in the royalty pool, with only minimal operating expenses associated with operating the fund. For a more comprehensive description of the fund's structure, please refer to the About the Fund section of the fund's website. Now I will go through our financial results for the first quarter of 2024 as compared to the first quarter of 2023. The interim unaudited financial statements and MD&A were released on SEDAR+ this morning, and the news release issued today summarizes the selected financial results of the fund. The Royalty Pool same-store sales growth of 0.6% in the quarter was a product of an increase in average check size due to industry-wide inflation on goods, services, and labor, partially offset by a decline in guest traffic. Food Services believes that the decline in guest traffic is primarily attributable to increased interest rates and inflation, which have impacted consumer discretionary spending. Royalty income for the first quarter of 2024 was CAD 11.6 million based on gross sales reported by restaurants in the royalty pool of CAD 385.1 million, compared to royalty income of CAD 11.4 million and gross sales reported by A&W restaurants in the royalty pool of CAD 381.3 million for the first quarter of 2023. The 1% increase in royalty income was driven by the royalty pool same-store sales growth of 0.6% and the gross sales from the 10 net new restaurants that were added to the royalty pool on January 5th, 2024. The increase was partially offset by there being one less day in the first quarter of 2024 as compared to the first quarter of 2023. Royalty pool same-store sales growth is based on an equal number of days in the quarter and year. Of significant interest to unit holders is the amount of distributable cash that the fund has generated to pay distributions and the payout ratio. Distributable cash generated in the first quarter of 2024 of CAD 8 million was consistent with the CAD 8.1 million of distributable cash generated in the first quarter of 2023, with minor offsetting increases in current tax expense and royalty income. Two monthly distributions totaling CAD 0.32 per unit were declared in the first quarter of both 2024 and 2023. The current monthly distribution rate of CAD 0.16 per unit translates to an annualized distribution rate of CAD 1.92 per unit. I'll now turn to discussing a payout ratio, which is a key metric to unit holders. The fund's long-term objective is to maintain an annual payout ratio at or below 100%. However, the fund strives to provide unit holders with regular monthly distributions, and as a result of seasonality of sales in A&W restaurants and the timing of current income taxes, the quarterly and annual payout ratio fluctuates. The payout ratio for the first quarter of 2024 was 114% compared to 112.9% for the first quarter of 2023. The 114% payout ratio for the first quarter of 2024 is higher than the trailing four-quarter payout ratio of 91.9% due to both the seasonality of sales and the timing impact of current income taxes. Now I'll turn things back over to Susan. Great. Thanks, Lisa. Food Services has continued to grow the A&W chain. We had 6 new A&W restaurants opened during the first quarter of 2024, bringing the total number of A&W restaurants in Canada to 1,060 as of March 24th, 2024. An additional 10 restaurants were under construction as at March 24th, 2024 as well. Continued growth of new restaurants, along with a stable supply chain and industry-leading innovation, and our unwavering commitment to consistently delivering great-tasting food and a positive guest experience are all expected to contribute to a stronger brand loyalty and positioning for A&W. I'd like to thank you for your attention, and we would now be happy to answer your questions. At this time, if you would like to ask a question, please press the star and one on your telephone keypad. You may remove yourself from the queue at any time by pressing star two. Once again, that is star and one to ask a question. We will pause for a moment to allow questions to queue. W e'll take our first question from Thomas Burke with Canaccord Genuity. Your line is open. Hey, guys. Thanks for taking my question. Hi, Tom. What are you seeing out there in terms of the economic environment? I mean, I think we all know that, you know, certain demographics are kinda stretched and becoming very, very budget-oriented here. Y ou know, what are you guys seeing, and how do you kinda respond to, you know, these types of challenges? O bviously, there's no question that, you know, food inflation, and just what appears to be a general economic malaise is really hitting home. I t's funny because we would think A&W would have some of that defensive characteristics to it, but while that may be there, you know, to a certain degree, there are challenges for sure? Yeah, definitely. Thanks for the question. Something we give a lot of thought to. A few things that I can share that we've noticed. One is, you know, I think there's two components to people's tightening of their wallets. One is their actual disposable income that's under a lot of pressure, given things like interest rates and rentals and food inflation, as you mentioned, and other types of things that eat away at people's disposable income, which is always a factor for QSR. T he other one is the worry that those factors might impact, you know, impact them in the near future. Even people that don't necessarily have any of those things coming into play at the moment, at the same time, there's concern, you know, from what they're reading and what they're hearing and what they're seeing from others, and legitimate concern, I'd say, about what their short-term prospects are as they think about income and disposable income in particular over the next little while. I think people are being more cautious. A couple of other things I'll share. One is that families are certainly feeling the impact more when you think about things like dining out. If there's an increase and someone is a single diner going out for lunch at work, you know, that might be an easier number to absorb or to sort of internalize in terms of how they balance their budget. With a family, a family of four eating out, can really be pressured, and that's why we're really focused right now on offerings that give great value and, in particular, great value for families. Right. D o you, like, when you do your numbers and your testing and everything and throwing things out there, do you, are you sort of, the whole demand elasticity thing, like, there's a breaking point where, yes, you need pricing power for margin and all the other things to just go along with, you know, surviving and thriving as an organization. A lso, like, you know, is it really a journey of you gotta test and sort of stick your neck out a little bit in terms of what your pricing initiatives are and all that type of stuff, or, you know, and then the other thing on the other type of question is. Like how do you kind of strategize to get, you know, that traffic back for families? Can you bundle up specials and that type of stuff? How do you respond to that? Yeah, you're asking all the kinds of questions that we ask ourselves. There's lots of ways to, you know, you mentioned testing. With price, I think it's a little bit different from testing products where you might ask people what they think of the taste, and is it spicy enough? Is it too spicy? Those types of questions that are much more subjective. With price, we have a lot of, things that we do every day in order to give great value to our guests. W hether that's offers on our mobile app, whether that's coupon offers that might arrive in people's mailboxes, whether it's special offers in restaurant or things that we put on our menu board. A s you say, it could be bundles for things that make it easier for families. We're pouring a lot of our promotional efforts into those types of deals that help people make it more affordable for people. A t the same time, it also allows us to understand what are the most appealing of those deals, and how do we get those available to people more often? Affordability is probably the key word here that people still have a real desire. Dining out has a lot of appeal. How do we make sure that it's affordable for people and that they're able to enjoy it as often as they'd like? Right. C an you share with us any updates on sort of the evolution of the Pret A Manger relationship? This is obviously not an insignificant development in the food service organization. H ow does that reflect back into the incumbent, you know, franchisee network across Canada and ultimately for the unit holders? Is there something to be gained for unit holders, or how do you see this playing out, if things come to a final conclusion, I guess, sometime in the next couple of months? Sure. Well, I can share. You know, we don't have all of the details ironed out yet, but one of the ideas that we have is that, you know, Canada's a big country, and A&W is present in a lot of communities across across Canada. W e are in a very good position to start to share information and experience with the brand. W e think that our current restaurants can do some of that work for us in terms of making it available as widely and as quickly as possible. W e're working on how that might look and feel. We're not at the conclusion point or the announcement point yet, but that's something that's in our mind, is what, what could we do that could help people understand what the Pret brand is in Canada. W here people have less familiarity with it, and how do we leverage our, our restaurants, and how do we in, you know, involve our operators in helping to give people that experience, even if it's in a smaller way, to start out with. Right. A re there already there must be plans for some sort of TV campaign awareness or something like that. Like, how does that kinda play out in terms of creating that brand awareness? Well, I'd say that the first thing is experience. You know, people need; it's a bit of a different kind of an idea and something that might be unexpected from A&W and from quick service restaurants. I think our first bet is, like we always do with our food and our own beverage launches and so on, like we did with the Brew bars, you know, giving people a nice opportunity to be able to taste and understand and start to get familiar with. I think it's not the kind of process that you can just, you know, snap your fingers at and put something on TV and say it's gonna happen overnight. We would prefer to see experiences sort of rolled out slowly but, you know, but well so that people can start to figure out what they like and add another layer or another dimension to what they already like about A&W. Right. D o you see any cross-pollination of ideas or menu ideas or new ingredients or sourcing or any of that type of stuff that, that would come with this, sort of, new arrangement and, and new acquisition of sorts, and how it can lend into sort of, the traditional footprint of the A&W network? I'm not seeing sort of hybrid things. I think that, you know, the power of a brand is really doing what each brand does supremely well. I think that's what we're trying to launch and have people experience. F or sure, there's always some ideas that come out of anything that we do that's new. R ight now, it really is about, for us, what can we do that could help enhance our A&W restaurant performance? T hat's where we're gonna start, and that should be work that we're gonna do. Y ou know, again, it's early to state any conclusions or anything, but we are hard at work in seeing what could be some first steps that we might take there. Right. A re there any because obviously, we've been through kind of, just say, a decade of, you know, the healthy food, the Beyond Meat, you know, a lot of different initiatives. Obviously, A&W is a pioneer on many fronts of hormone-free, steroid-free, and all these sort of better-for-you ingredients. It almost feels like things have flatlined. Like, there's almost nothing new to get excited about in food and food service. Do you have any comments around that? It's just that there seems to be a fatigue out there. Now, it's better to be A&W than it is to be maybe, say, a company like Beyond Meat that suffered, like, you know, just an incredibly hot trend and is really trying to re-practically build itself and redefine itself to a certain degree. You know, even for a pioneer or a company like A&W that does almost thrive on being a first mover in some novelties, like, it almost seems like there's not a lot of excitement out there. What do you think? I'd say stay tuned. I think we're gonna bring some excitement to the summer, certainly, as in our plans. I would also say, though, that at times when things are sometimes a little bit tougher for people personally and so on, familiarity is also a very big driver. Y ou know, we have that long-term relationship with Canadians. Many Canadians' first experiences with quick service restaurants were at A&W. And so we've seen also a sort of a reversion to some of the old favorites as well as interest in innovation. I think you'll see a combination of those coming from us as our way to both, you know, enrich the relationship with some of the familiar things that we've been serving for years and years as well as to introduce some new and exciting spurts of energy that can get people away from their screens maybe and into our restaurants or our drive-throughs. Right, right. Okay, great. All right. Good luck, guys. Thank you. Thanks very much. Once again, if you would like to ask a question, please press star and one on your telephone keypad. It appears that we have no further questions at this time. Oh, we did just have a question pop up here from Marco Tang with Leith Wheeler. Your line is open. Hi, Susan. Hi. Good to hear from you guys. Hi. I was just wondering if I could hear any comments you have on traffic and what the promotional landscape looks like from a competition perspective. I think, you know, everyone's under pressure in terms of traffic and visits just because of, you know, affordability is probably the key reason. T hat creates an environment where, you know, people are looking for value. They're finding value. I think our primary area right now that we're working on is making sure that there's always that type of value available at A&W from an affordability perspective, which tends to get more visits, more traffic. T hat's how we've sort of positioned our promotions for the next little while, is to keep on ensuring that when people come in, they feel like they can afford it. They feel like they wanna come back. Okay. Great. Thank you. Thank you. Nice to hear from you. Thank you. It appears that we have no further questions at this time. I will now turn the program back over to Susan Senecal for closing remarks. Thank you, Shelby. T hanks, everyone, for attending our call today. We look forward to updating you on our results after the second quarter. I n the meantime, if anyone does have questions that weren't answered on our call today, please feel free to call either Kelly Blankstein or myself at 604-988-2141. Thanks very much. That concludes today's teleconference. Thank you for your participation. You may now disconnect.