RE:RE:SIR CORP RESULTS The Corp had all of September and partway thru October without lockdowns before Ford locked down Toronto and peel in mid October. And from there, restrictions in other areas have increased.
Not sure matters much, but I don't see much cash flow burn, as they have driven down the cost base so much with the help of govt subsidies that survival doesn't seem to be an issue with vaccines starting to roll in q1/2021. Moreover, sir hasn't touched its bdc $6 million line and if needed, they could find other lenders if BNS elected to bail on a multi year client months before mass vaccine rollout (likelihood - close to nil).
The total Corp debt is not onerous relative to the normalized earnings power of the business. For 15 years, Fowler ran a sustainable business which averaged 10 percent ebitda margins, generated enough capital to pay out $150 million to the partnership/fund while also spending on transitioning faxoolis to scaddabish, keeping jacks modern with interior refreshes and introducing new concepts like Red's. The total debt at the Corp level (even after pandemic still less than $40 million) is not egregious, relative to its normalized EbitdA. And SIR has NO DEBT at the fund level, unlike Boston Pizza. Recipe Unlimitrd has $500 million in debt on 2019 ebitda of a little over $200 million.
lastly, sir has never franchised a single restaurant , unlike Recipe and BP, among others. So all the capital commitments have been made by SIR Corp, not some franchisee. It isn't a bad track record.
for holders of the fund, we just need stability at the Corp level, since we get a royalty from the revenues at the Corp level, so the more stores open and thriving , the better for the distribution. I am hopeful that 2H/2021 will be a big return to normalcy.
good luck.