IMVESCOR RESTAURANT GROUP INC. T.IRG

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[Finantial]

Pizza Delight’s business improving: CEO › Moncton-based chain has gone through some controversy, but Denis Richard is optimistic about the future AlAn CoChrAne Times & TranscripT The CEO of Mocton-based restaurant chain Imvescor says the company still faces challenges but is moving forward with improvements to revitalize the brand names, renovate the restaurants and beef up the marketing budget. In his report to the Imvescor annual general meeting in Moncton yesterday, Denis Richard said 2013 was a challenging year as the company closed 14 underperforming restaurants through the chain, which meant lost revenue. But he says the company should return to the business of opening new restaurants. Imvescor Restaurant Group is the parent company of Canadian restaurant chains Pizza Delight, Mikes, Scores and Baton Rouge. The company has a mix of restaurants, some owned by the company and others that are owned by franchisees. Richard reported revenues of $89 million for 2013, up from $74 million in 2012, versus expenses of $28 million in 2013 and $21 million in 2012. He reported a net debt of $29.3 million for 2013, down from $36 million in 2012. Yesterday, Imvescor Restaurant Group’s stock price was $2.20 per share. Richard is a native of Bouctouche who took over as CEO in 2011 with a mission of improving the company’s finances and soothing tension between the corporate head office and the franchisees. “The first year, we had to take care of the bankers, the second year we took care of the shareholders and this year we’re taking care of the franchisees,”Richard said in an interview following his presentation. He said the rift between head office and franchisees centred around the issues of funds for marketing and renovations. He said there are now incentive programs for franchisees to carry out renovations with their own money, with a promise of a bonus if and when their sales increase as a result. There’s also a program to give franchisees a voice on how marketing funds are spent. Another big move in 2013 was closing a plant in Moncton that produced sauces and other ingredients, and purchasing another 35,000 square foot plant. In this way, the ingredients will be produced for the restaurants at a plant owned by the parent company, as opposed to buying from other suppliers. It will also allow the company to sell products under its own commercial brand. Richard says his mandate to make changes comes from the shareholders. He started as president and CEO in February of 2011 and last year was fired by the board of directors. According to the annual report, he was paid a lump sum severance package of $1.2 million last July. He says the board’s decision to fire him had a lot to do with tensions between the head office and the franchisees. “I was about to change the senior management and not everybody was in agreement with that. I was clearly the CEO to fix the finances but was I the CEO to be the teddy bear for the franchisees?” He said he was asked by shareholders to return to the job as CEO. He did so, but didn’t pay back the severance package. Rather, he decided to work without accepting a bonus for a year. “I own $3 million worth of shares in this company, I have a big equity stake and I want this company to succeed. I asked the old board and the new board to go and look for a better CEO and they couldn’t find one.” The day before yesterday’s annual meeting, Robb Chase resigned as chairman of Imvescor’s board of directors. Yesterday’s meeting was chaired by another member of the board, Roland Boudreau. Also present at yesterday’s meeting was Bernard Imbeault, the company’s founder, who served as chairman of Imvescor up to 2009. Imbeault, of Shediac, acquired Pizza Delight in 1969 and built the chain over many years to the point where it became a publicly traded company. Imbeault’s wife Monique resigned from the board of directors in September, saying she could no longer function on the board with Richard as CEO. Although they are no longer involved with the management of the company, the Imbeaults remain shareholders. During the question period following the presentation, Monique Imbeault asked Richard whether there would be a dividend paid to shareholders. Richard replied there would not, since that money would be better spent being reinvested back into the company. Imvescor CEO Denis Richard speaks at the AGM at Delta Beauséjour Hotel yesterday. PHOTO: VIKTOR PIVOVAROV/TIMES & TRANSCRIPT

[Rainman]

Thanks for that Finantial.

[Rainman]

There is an updated presentation on the web site. https://imvescorweb.com/index.php?option=com_content&task=view&id=27&Itemid=62