| Once again I am pleased to report that Tim Hortons remains financially strong. Increasing cash flows, relatively low financial debt leverage, and ongoing business growth have all contributed over time to secure our significant financial strength and capacity.
We emerged from 2009 – a year in which much of the North American restaurant industry was challenged – as financially strong as ever before. Our Company generated $416 million in cash flow from operations and we had more than $100 million in cash and cash equivalents at year end.
During 2009 we invested $158 million, fully meeting the growth investment needs of our business, while also returning more than $200 million to shareholders through share repurchases and dividends.
Our Board has approved a 30% increase in our quarterly dividend for 2010 and a new $200-million share repurchase program. The dividend increase, to $0.13 per share, represents the third dividend increase since we went public, and the new share repurchase program is our fourth in that time.
Our ability to generate strong free cash flows, while maintaining relatively low levels of debt, gives us the financial strength and capacity that I believe set us apart from many in the restaurant industry.
We are able to successfully reinvest in our business to drive future growth and generate important system benefits for our franchisees because of our multi-layered business, which creates several high-quality income streams. These income streams have historically provided strong returns on investment and contributed to our overall financial performance.
Recent changes to our public company structure are expected to contribute positively to our net income and earnings per share growth during the next few years as well. Of shareholders who voted on our reorganization to become a Canadian public company, 99% did so in favour of the transaction. In addition to operational and administrative efficiencies over the long term, this reorganization enhances our ability to expand in Canada and internationally and improves our ability to take advantage of lower Canadian statutory tax rates.
As economic recovery appears ready to begin taking hold, we believe our prudent and disciplined approach to financial management will give us the strength and capacity that will continue to serve our franchisees, shareholders and company well.
Sincerely
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