Tim Hor­tons boosts cof­fee price in some re­gions; rev­enue up

The Guardian (Charlottetown) - - Business -

VAN­COU­VER — Rockwell Di­a­monds Inc. (TSX:RDI) plans to dou­ble its pro­duc­tion in the next six to nine months, largely through ac­qui­si­tions, as the di­a­mond mar­ket re­cov­ers fol­low­ing a near col­lapse ear­lier this year.

The Van­cou­ver-based di­a­mond pro­ducer, with op­er­a­tions in South Africa, is back on track af­ter nearly a year of dis­trac­tions, in­clud­ing an un­suc­cess­ful hos­tile takeover and the re­ces­sion, which caused di­a­mond prices to fall by more than 50 per cent.

“ We see some very good op­por­tu­ni­ties to cherry pick and ac­quire,” Rockwell pres­i­dent and chief ex­ec­u­tive John Bris­tow said in an in­ter­view Fri­day be­fore the com­pany’s an­nual share­holder meet­ing. “ We see our­selves grow­ing into a stronger com­pany, big­ger com­pany, through a com­bi­na­tion of or­ganic growth and fairly se­lect ac­qui­si­tions.”

The com­pany cur­rently has a tar­get of 2,500 carats per month. TORONTO — Tim Hor­tons Inc. (TSX:THI) is boost­ing the price of a cup of cof­fee in Que­bec, Man­i­toba and the Mar­itimes early next month as it con­tends with higher costs for run­ning its fran­chised stores.

Ex­ec­u­tives for iconic cof­fee, dough­nut and sand­wich chain told an­a­lysts in a con­fer­ence call that the price in­crease would be rolled out dur­ing in the first two weeks of Novem­ber, and that it would range from five to seven cents for a cup on cof­fee.

The de­ci­sion comes as it grap­ples with higher op­er­a­tional costs that range from the price of cof­fee beans to a min­i­mum wage in­crease in some parts of the coun­try.

In Septem­ber, the com­pany in­creased the price of some of its prod­ucts at On­tario stores, mostly by five cents each.

“ This year our store own­ers prob­a­bly faced more of a com­bi­na­tion of pres­sures, not only on the raw ma­te­rial side of things, but also from a labour per­spec­tive,” said chief fi­nan­cial of­fi­cer Cyn­thia Devine.

“ They held the line on pric­ing for a very long time,” Devine said in an in­ter­view.

On Fri­day, Tim Hor­tons served in­vestors with an­other quar­ter of rev­enue growth, even as prof­its shrank com­pared with the same time last year, as it ate $23.1 mil­lion in costs as­so­ci­ated with con­vert­ing back into a Cana­dian cor­po­ra­tion.

Rev­enue in­creased to $563.6 mil­lion in the third quar­ter ended Sept. 27, up 10.7 per cent from just un­der $509 mil­lion in the com­pa­ra­ble quar­ter of 2008.

The big­gest in­crease was at Tim’s Cana­dian stores, which brought in $492 mil­lion, up $50 mil­lion from the third quar­ter of 2008.

But U.S. stores also in­creased to­tal sales, which grew by $7.8 mil­lion or nearly 25 per cent to $38.9 mil­lion.

Same-store sales, which mea­sure per­for­mance of lo­ca­tions open for at least a year, in­creased 3.1 per cent in Canada and 4.3 per cent in the United States.

De­spite the sales growth, net in­come fell to $61.2 mil­lion or 34 cents per share in the quar­ter, down 22.3 per cent from a year ago.

“Per­for­mance was de­liv­ered in a tough op­er­at­ing en­vi­ron­ment that con­tin­ued to be framed by per­sis­tently high un­em­ploy­ment lev­els as well as other pres­sures in the North Amer­i­can econ­omy,” pres­i­dent and CEO Don Schroeder said in a con­fer­ence call with an­a­lysts.

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