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Press release content from Globe Newswire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Meritage Reports Second Quarter 2021 Results; Strong Sales And Earnings Growth

July 16, 2021 GMT

GRAND RAPIDS, Mich., July 16, 2021 (GLOBE NEWSWIRE) -- Meritage Hospitality Group Inc. (OTCQX: MHGU), the nation’s premier franchise operator, today reported financial results for the second quarter ended July 4, 2021.

Second Quarter Highlights

  • Sales increased 21% to $147.3 million compared to $121.7 million for the same period last year.
  • Earnings from Operations were $8.5 million compared to $10.7 million for the same period last year. The prior year contains one-time prime cost benefits associated with the COVID pandemic operating environment.
  • Net Earnings increased 31.9% to $8.0 million compared to $6.1 million for the same period last year.
  • Consolidated EBITDA (a non-GAAP measure) increased 5.8% to $16.9 million compared to $15.9 million for the same period last year.

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“Our earnings growth was driven by strong same restaurant sales, restaurant renovations, new store openings as well as real estate sales and development. Company restaurant management teams have done a commendable job of managing operations in a tight labor market as U.S. consumers return to pre-covid activity levels. We have re-opened all of our Wendy’s dining rooms in 16 states, along with six of our independent brand restaurants located in Michigan. Looking ahead, our operating and development outlook remains very strong as we plan to complete 33 renovations and open 15 new Wendy’s locations this year. We have set the stage for future growth, as we build toward our goal of 400 Wendy’s and 600 total restaurants in operation by 2025,” stated Robert E. Schermer, Jr., the Company’s CEO.

Six-Month Highlights

  • Sales for the six months increased 17.4% to $281.1 million compared to sales of $239.5 million for the same period last year.
  • Earnings from Operations increased 41.3% to $14.8 million compared to $10.5 million for the same period last year.
  • Net Earnings increased 440.3% to $12.9 million compared to $2.4 million for the same period last year.  
  • Consolidated EBITDA (a non-GAAP measure) increased 43.2% to $29.2 million compared to $20.4 million for the same period last year.
  • Common stock dividends issued increased 128.5% to $0.16 per share compared to $0.7 for the same period last year.

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The Company has committed significant long-term capital resources to support Wendy’s brand initiatives, including a newly expanded agreement to build 50 new Wendy’s restaurants by the end of 2025 under the Groundbreaking Incentive Program. Newly built and re-imaged restaurants continue to deliver strong sales and earnings results as guests continue to reward us for upgraded restaurant facilities and improved overall customer experience.

Company 2021 Full-Year Outlook: Strong Growth Ahead

  • Sales growth of +10% to 15%
  • Earnings from Operations growth of +20% to 30%
  • Net Earnings growth of +20% to 30%
  • EBITDA growth of +15% to 20%
  • Dividend growth +100% to 125%

Meritage continues to distinguish itself as a national leader and innovator in the quick service and new restaurant segments, striving for best-in-class results through a performance-based culture committed to operational excellence, strategic acquisitions and real estate development.

About the Company

Meritage Hospitality Group is the nation’s premier franchise operator, with 342 restaurants in operation located in Arkansas, Connecticut, Florida, Georgia, Indiana, Massachusetts, Michigan, Missouri, Mississippi, North Carolina, South Carolina, Ohio, Oklahoma, Tennessee, Texas and Virginia. Meritage is headquartered in Grand Rapids, Michigan, operating with a workforce of approximately 11,000 employees. The Company has approximately 9.6 million diluted weighted average common shares outstanding. The Company’s public filings can be viewed at www.otcmarkets.com, under the stock symbol MHGU, or the Company’s website www.meritagehospitality.com.

SAFE HARBOR STATEMENT
Certain information in this news release, particularly information regarding future economic performance and finances, and plans, expectations and objectives of management, constitutes forward-looking statements. Factors set forth in our Safe Harbor Statement, in addition to other possible factors not listed, could affect the Company’s actual results and cause such results to differ materially from those expressed in forward-looking statements. Please review the Company’s Safe Harbor Statement athttp://www.meritagehospitality.com.

CONTACT:
Robert E. Schermer, Jr., CEO
Meritage Hospitality Group Inc.
616-776-2600 ext. 1012