Good morning everyone. And thank you for joining us for MTY’s 2021 fourth quarter results conference call.

The press release and the MD&A with complete financial statements and related notes as well as the annual information form were issued earlier this morning and are also available on our website, as well as on SEDAR. During the call, we will be referring to forward-looking statements and to certain indicators that are non-IFRS measures.

You can refer to our MD&A for more details. I also remind you that all figures presented on today’s call are in Canadian dollars unless otherwise stated.

After nearly two years of navigating through the COVID-19 pandemic, the incredible resilience of our franchise partners and staff made it possible for MTY to once again, deliver robust financial results in fiscal 2021, demonstrating the strength of its business model and the benefits of having a diversified portfolio of great brands. Those results were highlighted by recorded adjusted EBITDA and cash flows from operations of $168.6 million and $139.3 million respectively for the year ended November 30, 2021.

Altogether, system sales improved 5% in 2021 to reach $3.6 billion, despite the adverse impact of foreign exchange rates capitalizing on the momentum, some of our brands gained into during 2020 and on the opportunities offered by the growing appetite for online takeout or delivery ordering. All this, while many of our brands are still in recovery mode, following heavy restrictions resulting from the pandemic.

Turning to our fourth quarter results in 2021, adjusted EBITDA increased 22% year-over-year to $42.8 million, mainly driven by a sharp increase in high quality recurring revenue streams. Major brands, such as Cold Stone, SweetFrog, Taco Time, Thai Express and Sushi Shop, for example, continued to perform exceptionally well while many casual dining brands recovered their 2019 sales levels and food court restaurants were gradually stronger.

The networks overall scalability allowed margins to increase to 55% for the franchising division, highlighting the high quality of revenues generated in MTY’s discipline when it comes to cost management. System sales, meanwhile grew 8% in Q4 2021, mainly due to a reduction of the impact of government imposed restrictions during the period, which led to increased customer traffic in the most recent quarter.

The casual dining concepts contributed $41.7 million to the increase, a surge of 36% year-over-year, despite still facing some restrictions. The geographical split of MTY system sales remain relatively stable compared to 2020, with 62% in the United States, 35% Canada and 3% international.

For the fourth quarter, these proportions were 57% for United States, 40% for Canada and 3% for the United or international. Moving onto our network, we opened 60 locations and permanently closed 189 in the fourth quarter of 2021 for a net store loss of 129.

MTY ended the fourth quarter with 6,719 locations, of which 6,603 were franchises. 93 were corporate and 22 were joint ventures.

Although, delays to open new locations have significantly increased due to supply chain disruptions and scarcity of labor, we are very pleased with the strong pipeline of future new locations to be opened by new and existing franchise partners in North America and internationally. Altogether, 259 locations were closed at least one day of because of COVID-related issues during the fourth quarter of 2021, which resulted in approximately 9,500 lost business days.

Although, this number has fallen to its slowest level during the pandemic, we expect this figure to increase in Q1 2022 due to additional government mandated restrictions that started in December 2021 in Canada. On the bright side, many governments have since announced plans to lift these restrictions in upcoming weeks.

So the impact should be limited to the first quarter of 2022. The pandemic also had numerous side effects that are impacting our industry on a daily basis.

MTY has not been immune to supply chain and labor issues, which are affecting many industries worldwide. We are proactively helping staff and franchisees mitigate supply chain constraints by introducing novel workarounds and pricing increases on menu offerings while labor shortage issues are being addressed with a more global approach involving in some cases, menu reductions, or streamlining, working with suppliers to provide products requiring less employee hours in the restaurants, rethinking operations and enhanced training offered to our crews, et cetera.

We expect these headwinds to persist in 2022 and further solutions are being looked at to address the situation. During the fourth quarter of 2021, MTY repaid the further $22.7 million in long-term debt, bringing the total repayments for the year to $102.2 million into $211.4 million during the last two years, despite all the turbulence that affected our business.

These repayments bring our leverage to a very comfortable level, allowing us to repurchase MTY shares for cancellation, restore and subsequently increase the dividend paid to our shareholders and aggressively pursue new acquisitions. MTY's capital strategy or priority remains defined attractive strategic acquisitions to enhance our network and provide more opportunities to grow in the future.

Aligned with our growth strategy, we closed the acquisition of Küto Comptoir à Tartares, a fast-growing chain of tartare restaurants following Quadrant. I'll now turn the call over to Renee who will discuss MTY’s financial results in greater details.

Thank you, Eric, and good morning, everyone. Let's start with our network.

So as mentioned by Eric in total 259 locations were closed at least one day during the fourth quarter of 2021, which resulted in approximately 9,500 lost business days. Although this number has fallen to its lowest level during the pandemic, it’s still affected our recurring revenue streams and adjusted EBITDA.

Although we had an increase in temporary close locations during our first quarters due to additional government restrictions in Quebec, Ontario, and The Maritimes, we are happy to report that currently we have 71 restaurants temporarily closed, a decrease of 11 since November 30, 2021. We expect this number to further decrease over the course of the next couple of weeks as more of these government restrictions are lifted.

In the fourth quarter of 2021 total revenues grew by 15% to $146.3 million mainly due to the recovery in Canada from the onset of the pandemic second wage and related government imposed restrictions in the same period of 2020. Franchising revenues in Canada improved 22% year-over-year to $33.7 million, while food processing, distribution and retail revenues increased 40% to $34.6 million.

As mentioned by Eric, the growth in the Franchising segment comes primarily from recurring revenue streams, which we expect to continue to grow as restrictions are further lifted and the world adjusts to the new normal of living with COVID. In the U.S.

and international franchising revenues decreased 2% to $39.7 million largely caused by a negative foreign exchange impact. Recurring revenue streams were in fact up $1.8 million year-over-year in the U.S.

and International segments. What is promising is that although our recurring revenue streams increased by $6.3 million and $1.8 million for Canada and the U.S.

respectively during the quarter, our recurring controllable and non-controllable expenses only increased by $1.2 million and $0.3 million showcasing the true cost management efforts we put into place and the continued positive impacts it is having on our results. Quarterly adjusted EBITDA increased 22% year-over-over to $42.8 million in the fourth quarter of 2021.

The Canadian segment contributed 47% of total adjusted EBITDA in Q4 2021, representing a year-over-year increase of $5.8 million, while the U.S. and International segments contributed 53% of total adjusted EBITDA accounting for a year-over-year increase of $1.8 million.

We are extremely pleased with our overall franchising EBITDA margin of 55%, which not only surpass our 2020 margin of 46%, but also our 2019 margin of 51%. Our Retail Processing and Distribution segments, although we had drop in our margins from 16% to 11% due to an increase in input labor and transportation costs, we are happy to report a revenue growth of 39% for the segment.

Net income attributable to owners reached $24.9 million or $1 per diluted share in the fourth quarter of 2021 compared to $20.1 million or $0.81 per diluted share for the same period last year. Now turning to liquidity and capital resources.

Cash flow from operations amounted to $31.9 million in the fourth quarter of 2021 compared to $44.8 million in the fourth quarter of 2020. The decrease comes mostly from an increase in tax installments made during the fourth quarter of 2021, as well as higher than normal collection of accounts receivable in 2020 due to the deferred royalties we provided earlier in that year.

Free cash flows reached $35.6 million or $1.44 per diluted share in the fourth quarter of 2021 compared to $43.9 million or $1.78 per diluted share for the same period last year. During the fourth quarter, we used cash to reduce our debt by $22.7 million paid out a dividend of $18.5 per share and repurchased 36,600 shares for a total consideration of $2.2 million under our NCIB program.

Following the quarter end, we raised our dividend by 14% to $0.21 per share. This represents our ninth increase over the past 12 years when we first introduced dividends.

At the end of the fourth quarter, long-term debt, mainly in the form of bank facilities and holdbacks on acquisition stood at $347.6 million. We also ended the quarter with $61.2 million of cash on hand.

And with that, I’ll turn it back to Eric for the conclusion.

Thank you, Renée. So just a few takeaways before we open the lines for questions.

First, MTY delivered solid financial results in the fourth quarter and fiscal 2021, while still improving its balance sheet. Our balance sheet is in great shape and is ready for potential acquisitions, large or small.

Second, both staff and franchises have responded proactively to pandemic related challenges along with global supply chain and labor issues. Our teams are doing a phenomenal job every day to keep the lights on and make sure our franchisees face as little disruptions as possible.

Our sound growth strategy combined with the sustainable business model should generate profitable growth as key end markets begin to reopen on a large scale basis in 2022. Finally, I’m pleased to report that MTY will publish its first ESG report during fiscal 2022, highlighting our commitment to sustainability, diversity and good governance practices.

We are currently in the process of laying the foundation for our ESG objectives, understanding where we’re at and establishing priorities for the next months, years and decades. Our goal is to ensure our targets are measurable, tangible and that we work on what matters most to the communities we operate in and the various stakeholders that are involved with MTY.

Ultimately it will allow MTY to integrate ESG considerations into our daily operations and strategic decision making. In closing, I would like to sincerely thank our employees, franchise partners, customers, and suppliers for their ongoing support.

With that being said, we will now open the lines for questions. Operator?

Yes. Thanks and good morning, everybody.

Congratulations on a good quarter. I guess, my first question is, impressive growth on the distribution side.

Maybe you could just talk about some of those drivers. I think in the MD&A story, you also said that the improvement is tied to the higher restaurant sales.

So I was wondering if you could talk to that. And then finally, what is the long-term plan for this business in particular?

Yes. Good morning, Derek.

On the distribution side, we have two small distribution centers that that serve two of our brands Valentine and the other one is Casa Grecque. So Casa Grecque obviously in Q4 of this year was doing better than the year before.

So that that helped a great deal with growing the distribution revenues. But that being said, that segment also has the retail revenue in it and also has the manufacturing revenues in it.

And most of the increase you see obviously, Casa Grecque has caused a substantial amount of the growth, but retail is also a segment that’s very strategic for us. So a portion of the growth you’re going to see in the future is going to come from retail more than the distribution.

So, yes, retail is a key strategic component for us of our growth. We believe that there’s a really good market for breaded products, high quality products that we can sell to the end customers that might not be visiting restaurants.

So we’ll push on that for sure in the future.

That’s helpful Eric. And one more and I’ll requeue.

On your digital sales, I was just wondering if you think if the sales opportunity has peaked for you. I mean, the revenue was pretty flat year-over-year.

Yes. No, certainly not.

In the U.S., we’re still investing in new technologies. For example, at Papa Murphy’s, we’re investing heavily in new technologies to drive more digital.

We believe that digital is the way of the future. Not only because of the skip the line aspect of it, but more so with the amount of time customers are – have at their disposal, if they decide to go digital, they can look at the menu, spend a little bit more time on it and maybe buy different things.

So we’ll certainly push on digital. Papa Murphy’s investing for a lot of our brands in the U.S.

We are with Kahala, we have a number of our brands also where we’re changing certain aspects of the digital world marketing loyalty, online ordering. And then in Canada, it’s still untapped potential for us.

So we have basically undone everything we’ve done in the past because we wanted to start over in Canada for the most part. So that happened in November and now we’re relaunching digital and online ordering opportunities for a lot of our brands.

So we’re still working on the kinks here. But I think in the next few months, you’re going to see a little bit more marketing around it and there’s certainly very large opportunity.

And one of the aspects that’s really interesting is to look at the amount of our digital sales that are coming from aggregators versus the ones that are coming from our own platforms. And in the U.S., you’re looking at about a third of our orders coming from aggregators and two-thirds coming from our own platforms, which is really a desirable mix.

And in Canada, it’s about the opposite. So a lot more coming from aggregators, which is a lot less profitable and about a third coming from our own platforms, which is the segment that we want to push.

So it tells us that there’s ways to grow in Canada. And the fact that we’re now investing in the right technologies and that the brands have the capabilities to really expand on that I think is really promising for the future.

Thanks for that, Eric.

Thanks for taking the question. So maybe just to start, Eric with things transitioning to a more normalized environment, how do you think about where your corporate SG&A sits and where you would like that level to be?

Yes. I think in terms of SG&A, we’re pretty much where we’re going to be.

We obviously, like every other company have a number of vacant positions that we need to fill. But unfortunately, I think for every position we fill, we’re going to have another one that we’re going to need to fill.

So I think SG&A is probably at the right level now. There’s pluses and minuses here that go, there’s a certain portion of it that’s not necessarily controllable.

But I think now would be a good baseline for the SG&A.

Okay. And then your balance sheet, it looks like your sub 2x net debt to EBITDA.

Maybe correct me on that if I’m not right? What – is there something specific out there that’s perhaps holding up M&A for MTY?

Or is it a more competitive market? Is it the opportunity set, just trying to gauge what’s happening there?

Yes. It’s a little bit of everything you mentioned.

Certainly our balance sheet is not holding MTY back in terms of acquisition. So I think we need to see the deal flow become a little bit more dynamic.

And from the deals we’ve seen, a lot of it is very large companies owned by private equities that are in harvest mode now. And unfortunately you’ve seen some of the multiples that some of our competitors have paid for, for acquisitions.

MTY’s not – we’re not playing in these types of acquisitions where people pay over 20x EBITDA for a deal. So we’re going to be a little bit more patient here.

We are seeing some movement in terms of deal flow. So whether or not, it ends up into opportunities for MTY, time will tell.

But I think among the factors, the multiples and the competitive market is certainly one especially for the larger deals. And then the deal flow needs to become a little bit more dynamic, but I have a feeling that this is starting to become a little bit more normal.

And if we’re thinking about where M&A might be, do you have a preference right now between Canada and the U.S. for M&A?

No. We’re very agnostic when it comes to M&A geography.

I don’t think we’d go overseas necessarily. So we’re happy with North America for now.

But yes, there’s plenty of opportunities. I think naturally there’s going to be more deal flow in the U.S., just because of how deep the market is.

But there are still good companies in Canada that that we’re also interested in and if they ever become for sale, we’ll certainly be listening. So we’re very agnostic when it comes to geography.

But I think naturally the U.S. will become a little bit bigger just because of the depth of that market.

Okay. Thanks for taking the questions.

Thank you very much. Good morning.

I wanted to start with the impact of labor shortages and the supply chain that you referenced, Eric. And beyond the stores that were closed solely because of government restrictions, can you quantify the impact of reductions to operating hours from staffing shortages in the quarter and subsequent to it?

Is this being a drag on system sales?

Yes, for sure it’s a drag. There’s no question about it.

It’s really hard for us to quantify it because we don’t always know. And sometimes, we find out after the facts that operating hours were reduced or a day or two was closed during a certain week.

Labor shortages are everywhere. They’re affecting our suppliers, they’re affecting our distributors, they’re affecting even construction of restaurants.

So we’re seeing it a little bit everywhere, but to quantify the impact would be tough. I mean, we even had situations where our franchisee is short of staff and they have to work all the hours.

They catch COVID and they have nobody else to open the store. So they need to close for a week.

So we’ve had quite a few of those. So I wouldn’t necessarily speculate on how much it represents, but I can certainly say for sure that it’s a drag on system sales.

Okay. That’s helpful.

Thanks. I appreciate the disclosure on the different restaurant types year-over-year.

I was wondering if you can say where casual restaurants and malls and office towers are versus Q4 2019, even if just approximately just to get a sense of how those are varying versus pre-pandemic.

Yes. Well, the good news is for casual dining and not all of our concepts, but many of them have recovered 2019 levels or even exceeded them.

Unfortunately, we had to suffer more closures and more restrictions in Q1 for Quebec and Ontario and Atlantic provinces. But it’s really encouraging to see that our franchisees have been able to find staff and find a rhythm to be able to operate and generate sales.

And before we had to close again in December the sales were for a lot of our concepts exceeding 2019. Now that’s not for all our concepts, so that’s not for all our restaurants.

If we’re in major urban centers, for example workers and Christmas parties haven’t recovered. But for a lot of our concepts, it’s really positive.

When it comes to malls and food courts and office towers in general, that’s still a struggle. The sales are creeping up, so we’re going in the right direction.

And we’re certainly making leaps and bounds with pretty large numbers and in terms of increases, but we’re still way short of 2019. The traffic hasn’t recovered.

A lot of these are located in major urban centers, again, that are dependent on lunch hour for office workers or for tourists. And we just haven’t recovered that yet.

So we still have a little bit of struggle with these situations, but we’re also going in the right direction. And if we’re getting better every month I think we’ll eventually recover 2019 and exceed it.

But there there’s still a little bit of ways to go.

Okay. And as a follow-up to that you did see an elevated level of closures in the quarter, and that was disproportionately skewed towards office towers and food courts involved.

And I’m wondering when you have conversation with these franchisees do you get a sense that that elevated closure level could sustain in 2022 because of the roll off of subsidies or is there a level of confidence that that these franchisees actually have relatively healthy operations and you can keep operating even without the subsidy?

Yes. For the vast majority of our franchisees, financially they’re doing well.

I think the mental strain of opening and closing is probably more difficult than the financial aspect. So yes, the closures are related to a number of different items that happen.

It’s really case by case. But I will say in terms of closures, Q4 is always a little bit heavier than the other quarters historically.

So we always have a little bit more, our seasonal frozen treats for example, will tend to close after the summer if they have to close. So we’ve lost a few there.

We also – unfortunately, we have one of our partners internationally that’s not doing well financially. They’ve gotten insolvent.

So we have a certain number of closures that are related to that partner. They all happen at one time at the same time.

So it looks like a bigger number. And there’s also a pretty thorough review we did in Q4 of our temp closed locations because we wanted to see that after nearly two years of pandemic, these temp closed locations are they ever reopening.

And there were some adjustments there where we found out that that some of these restaurants will not reopen. So even though we had hope and even though our franchise partner kept saying that they were going to reopen, there were a certain number of them that after discussion, we come to the conclusion that they are not going to reopen.

So there was a certain adjustment there also in terms of which store we believe will reopen and which store we believe won’t. And obviously those I don’t expect to carry into 2022.

So I don’t have a crystal ball. I don’t know what’s going to happen in the future.

But I do expect that this very high number of closures, it’s going to be more a one timer than something that’s going to reoccur in the future.

Okay. That’s great color.

And then the last one for me a follow-up on a prior question, I wonder how you think about the leverage ratio with the balance sheet where it is? And in a period where you’re seeing maybe lighter M&A deal flow and higher valuations and you take a pause on M&A versus what you’ve done in the past.

Would you lean more on the NCIB and do you have a target leverage ratio in mind?

Yes. Well, the target ratio – right now, we're comfortable with our debt.

We'd like to have acquisitions and add a little bit more not because we like debt, but because we like acquisitions. So we're very comfortable where we are.

So we did continue to acquire shares of MTY after year-end. So you saw that we have a small number in November and we continued after November.

So we did buy back shares. We increased our dividend but in terms of capital allocation at the moment, the priorities really to find good strategic acquisitions that we can really make a difference for MTY and for the franchise partners.

So yes, we'd like to add leverage in the right circumstances for acquisitions. So that's top priority for us.

Okay. I appreciate the color.

I'll pass it on. Thank you.

Hi. Good morning, guys.

How did Papa Murphy do this quarter Eric on a year-over-year basis? And if I ask you to maybe look at your crystal ball, do you think we've seen the toughest of the comps for that banner or do you maybe think that they're coming up?

Yes, my crystal ball is pretty muddy, George, so I don't trust it much, but yes, Papa Murphy did better in Q4 than it did in Q3. So pretty reasonable Q4 comping against very difficult numbers, but in general comping well a little bit off of 2020 levels.

But in general, comping well, now the only thing I can say is Q1 return to more Q3 levels or Q1 at the moment is a little bit more off than we'd like it to be. But we seen the worst, I hope to thank – I hope we've seen the worst.

I think we have a lot of good stuff in store for Papa Murphy's. There are things that are happening in the markets that we don't control.

But I do believe that we're doing the right thing for this brand and I'm pretty bullish about the future. So I won't read into a week or a month or even a quarter, whether the brand is doing well or not, I'll evaluate the performance of the team over a longer period of time.

We're not off by numbers that are causing very big concerns for us. So it's not like we were off double-digits or something.

So we're not anywhere close to that. So doing the right things, keep trust the process and make sure you do everything right and everything you can and the rest will happen.

And we just need to keep plugging and figure it out.

Okay. I saw some activity on the corporate stores in that banner.

So can you maybe talk a little bit about where we are in terms of selling those or franchising those?

Yes, we franchise a large number of corporate stores in the last few months. So we have a few pockets of corporate stores left for that brand, but we don't have that many.

If you remember, when we acquired the brand, we had over 100 corporate stores and we're not anywhere close to that now. So we franchise some really good markets.

And Minneapolis was the latest with over 25 stores being franchised at one time. So we're really happy to have this new franchise partner in the MTY family and we're going to work with them to do the best we can.

And now the few markets that we have left are markets that are a little bit more difficult. So we're going to work hard to turn them around and make them franchisable.

Okay. That's helpful.

And on your commentary about the – I guess, store location that accelerated a little bit, can you comment a little bit on the temporary closed locations? I think there's a smidge over 70 there.

So can you talk a little bit about the likelihood, I guess, that those can close over the near-term or any commentary there?

Yes. Well, the temp close locations are I mean, they're not many, so now they're getting easier and easier to track a large number of those are for example, movie theaters in Canada.

And we do expect those to reopen at some point. But I guess the owners of movie theaters are waiting for the next blockbuster or they're waiting to be able to operate at full capacity.

I'm not sure exactly what's happening there and how their restaurants are performing, but there's a large number that are related to movie theaters. There's also a number of that are related to, for example, if you're familiar with Toronto, restaurants that are in the path where the path is supposed to be really busy at the moment if it's not that busy.

So we have some there, so major urban centers where you'd find normally a lot of tourists and a lot of office workers that are just not present at the moment. So those make up the bulk of our temp close locations and after very thorough review, we do believe that the ones that are temp close at the moment will reopen and we're working with our franchise partners to get that done.

So yes, we're pretty optimistic about the ones that are left.

Okay. And free cash flow conversion has been jumping around quite a bit, Eric, I guess in fiscal 2020 and fiscal 2021.

But if we were look at this year, how should we think of conversion from, I guess – free cash, is that kind more normalized or anything you can maybe provide there?

Yes. Well, free cash flow conversion has been really high in the last two years.

I think probably more than normal, normally you'd have your EBITDA and then you pay your interest on the debt and a normal rate of income taxes. And that should be pretty much our free cash flow conversion for MTY because we don't have much CapEx at all.

And in the past few years, in the past two years, we've paid less in taxes. We've really optimized the working cap.

So maybe numbers are a little bit higher than they should be in terms of percentage conversion. We'll probably go back to normal, I guess in 2022.

So the numbers should be a little bit lower than what we've experienced recently.

Okay. Just one last minute, before I go, on general on M&A, have you noticed the gap between acquisition multiples in Canada and the U.S., maybe widened more than usual and maybe as a result, should we expect maybe a higher cadence of smaller deals in Canada, just your thoughts there?

Well, for a certain period of time, the SPAC market was really hot for restaurants. So the expectations of multiples became really high in the U.S.

I think now that the SPAC market is not completely dry, but I think it's a little bit close back, close down on restaurants. So I think the multiples are going back to multiples that are numbers that are a little bit closer to historical averages.

So yes, there's always been certain gap between U.S. and Canada.

But it's not different than it was historically. I think the gap is more where in terms of the size of the deal where the smaller deals will come in normal multiples and the larger the deal, the larger the multiples going to get because private equities are getting more excited.

And then we've seen some going for over 20 times EBITDA, the size was gigantic but 20 times EBITDA has also really impressive. So I think the larger the deal, the higher the multiple regardless of geography at the moment.

So I think we're going back towards normal levels except for very large deal.

Okay. Thanks.

That’s helpful.

Great. Thanks and good morning.

Just a commentary earlier around some pricing that you took, I guess, what did you find net impact to be the consumers generally accepting a price in this environment? Was there any slowdown in traffic at all, any comments on maybe different trends by banner when you took pricing?

Yes. And we do take pricing.

We have taken pricing in last year and we are taking pricing at the moment as well. So it's something we can't avoid unfortunately, and our competitors are seeing the same thing.

So it's hard to know exactly the impact of pricing on traffic, because there's just so many other factors that are at play, especially at the moment with COVID and restrictions and the new variants and government saying one thing one day and saying a different thing the next day. It's hard to really isolate the impact of pricing on traffic.

So obviously customers prefer low prices. I'm certainly one of them but I think customers at the moment expect the price to go higher.

We are taking price the same way everybody else is taking price. So it doesn't necessarily mean anything in terms of our competitive positioning because everybody's taking very similar price increases.

So I don't believe the decline in traffic related to pricing is really material. I might be wrong.

Again, it's hard to measure with everything that's going on at the moment. But yes, I think customers are expecting pricing.

You go to the grocery store, you see your prices go through the roof. You go pretty much anywhere.

And the inflation is really important. So restaurants are no different.

And I don't think the impact on traffic is so material at the moment.

Okay, great. And then on the M&A, there's quite a bit of discussion on this earlier, but just in terms of the volume of deals, is it – relative to what you may have expected a little while ago, just – is there just a generally less deal activity in the space, giving it's because restaurants are generally feeling better coming out of the pandemic than maybe we would have thought, just to comment on the volume of activity across North America?

It's starting to get back to normal. For a while it was really quiet.

You had these restaurant operations that did really well that wanted to ride the wave a little longer, and you had these restaurant operations that really struggled that didn't want to go for fire sale prices. So everybody was just sitting on their assets, but I think now the deal flow is going back towards something a little bit closer to normal.

So pretty optimistic about the future, obviously there's no guarantees that we're going to be able to make deals, but we're certainly happy to see deal flow and to have discussions with owners and bankers about potential acquisitions.

Great. Thanks very much for the color.

Hey, Eric, as you think about the path and your franchisee recruitment network, like the desire among new franchisees to come in and open new restaurants, like how would you characterize that? Has there been a change there?

Do you see as strong demand in the past, do you think it could be improved like how would you think about that?

Yes, we're really happy with that in terms of – not only in terms of new franchisee acquisition, but also in terms of the desire of existing franchisees to open more stores. I think both are probably a close to historical highs that we've had.

So the pipeline is really good. It's a challenge now to find good real estate at reasonable prices and to build the stores, there are some pieces of equipment that just don't exist on the market anymore.

So we need to be patient. So it takes time to convert a sale of a franchise into an existing store where we used to have stores open.

And in three to six months now, we're talking about 18 to 24 months in some cases. So it takes a lot longer.

So a lot of the sales and the knowledge of the new franchises that we've signed in, even in 2020, some of them are not even in a store yet just because construction and real estate is a little bit more complicated, but we're really happy with where the pipeline sits. Then it's pretty good for the future.

And if we're thinking about this coming year, do you think that you can track closer to a net neutral type number on store openings and closures?

That's always our goal. I always said that it's hard to control the closures.

It's easier to control the opening, but at the moment, even the openings are hard to control because we have restaurants there, there's an example now of a restaurant, a casual dining restaurant that's ready to open and the HVAC equipment won't be available for another six months. So, I mean, it's hard to open without an HVAC system, even though the restaurant is ready.

So even the openings are a little bit more difficult to control now. So we're always pushing to be net positive and that's been an objective of ours for a long time.

I think we'll get there at some point but when exactly that's going to happen, I wouldn't be able to make a prediction on that.

Okay. That's all for me.