Pizza Pizza Royalty (PZA) investor relations material

Executive summary

• Same store sales grew 2.1% in Q2 2025, reversing prior declines, with both brands contributing positively despite a softening macroeconomic environment.

• Royalty Pool System Sales rose 3.9% to $161.4M in Q2, driven by increased guest traffic, higher average check, and successful marketing and menu innovation.

• Adjusted EPS increased 1.3% to $0.241 in Q2.

• Restaurant network expanded to 800 locations in Canada, with 3 net new locations year-to-date and 20 net new restaurants added to the Royalty Pool.

• Ongoing development in Mexico continues, though at a slower pace than initially targeted.

Financial highlights

• Q2 Royalty income was $10.3M, up 3.8% year-over-year; six-month royalty income reached $20.1M.

• Dividends declared totaled $5.7M (23.25¢ per share) in Q2, consistent with prior year.

• Payout ratio was 108% in Q2, utilizing $400K from working capital reserve, which ended at $4.8M.

• Adjusted earnings available for shareholder dividends were $5.3M in Q2.

• Working capital reserve stood at $4.8M at June 30, 2025, down $1.3M during the period.

Outlook and guidance

• Management expects 2–3% traditional restaurant network growth for 2025, with continued renovations and a focus on value messaging, digital investment, and customer retention.

• Dividend policy aims for consistent monthly distributions, funded by operations and cash reserves.

• Mexican expansion continues, though pace may be slower than initially targeted.