Priszm Income Fund says it is developing a KFC value strategy and will introduce new innovative menu items to pull the restaurant franchisor and operator out of a disappointing first quarter.

Toronto-based Priszm, the fund behind most of Canada’s KFC, Pizza Hut and Taco Bell food outlets, said yesterday its loss for the three months ended March 31 widened to $4.8 million or 30.1 cents a share. That compared with a loss of $2.6 million or 17.7 cents a share in the same year-earlier period.

Restaurant sales from continuing operations slipped eight per cent to $83.5 million from $91 million.

“We are not happy with our recent sales performance,” executive chairman John Bitove said in a statement released yesterday.

“We are working closely with the franchisor, Yum! Canada, to improve performance for the balance of the year.”

Bitove said the lower restaurant sales stemmed from a drop in same store sales growth, which fell 7.1 per cent over the same quarter of 2009, and from operating nine fewer restaurants than at the end of the corresponding period last year.

The fund holds a 60 per cent interest in Priszm Limited Partnership, which owns and operates more than 400 KFC, Taco Bell and Pizza Hut restaurants in seven provinces across Canada.

Units of the fund dipped half a cent to 86 cents on the Toronto Stock Exchange.

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