GRAND RAPIDS, Mich., Feb. 26, 2020 (GLOBE NEWSWIRE) -- In a press release under the same headline issued Monday, Feb. 24, 2020 by Meritage Hospitality Group Inc. (OTCQX: MHGU), please be advised the number of common shares outstanding has changed to "9,032,790" rather than "9,033,570" as originally issued. In addition, other changes have been made throughout the document. Complete corrected text follows:
Meritage Hospitality Group Inc. (OTCQX: MHGU), one of the nation’s premier franchise restaurant operators and developers, today reported preliminary financial results for the fiscal year ended December 29, 2019.
2019 Full-Year Highlights:
- Sales increased 7.4% to $467.5 million compared to $435.3 million last year.
- Earnings from Operations were $21.2 million compared to $25.4 million last year.
(The change in Earnings from Operations reflects the current QSR labor environment that requires the Company to invest in wages, increasing base wages by 4.7% during the year. In addition, the current year included $2.1 million in additional depreciation, a non-cash expense)
- Net Earnings were $12.9 million compared to $13.2 million last year.
(The change in Net Earnings reflects a negative year over year non-cash GAAP charge of $2.5 million resulting from the Company’s interest rate swap agreements, which are measured at fair value based on mark-to-market)
- Consolidated EBITDA (a non-GAAP measure) increased 12.2% to $44.6 million compared to $39.7 million last year.
- The Company developed or acquired a net of 20 restaurants during the year, to finish with 337 restaurants in operation across 16 states.
- Common stock dividends increased 60% to $0.24 per share compared to $0.15 last year.
“Our operations and development performance in 2019 represented significant milestones in our 5-year growth plan, finishing the year strong with 337 restaurants in operation. Despite minor development delays and non-cash impacts to reported net earnings for fiscal 2019, we were pleased with fiscal 2019 results of achieving 12.2% EBITDA growth while developing and renovating a record number of new locations. We continue to transform our restaurant portfolio through the development of new locations and renovation of existing locations, offering both guests and employees more conveniences. Looking ahead to 2020, we are forecasting a transformative year, with robust sales growth of approximately $100 million that includes the rollout of breakfast in 316 of our Wendy’s restaurants, new restaurant development, modernizations and the continued development of our new Morning Belle breakfast, brunch and lunch restaurant concept. Operational excellence continues to be our inspiration, leveraging the Company’s best-in-class operating platform and restaurant development expertise, while delivering on the Wendy’s brand promise of quality, convenience, and value,” stated Meritage CEO Robert Schermer, Jr.
Fourth Quarter 2019 Highlights:
- Sales increased 12.5% to $121.2 million compared to sales of $107.8 million for the same period last year.
- Earnings from Operations were $3.6 million compared to $6.0 million for the same period last year.
(The change in Earnings from Operations was caused by labor pressure from market wage inflation that requires the Company to continue to invest in employee wages. In addition, depreciation, a non-cash expense, increased over prior year as modernization and development efforts continue)
- Net Income was $2.4 million compared to $2.4 million for the same period last year.
- Consolidated EBITDA (a non-GAAP measure) was $9.4 million compared to $10.1 million for the same period last year.
Meritage will continue to focus on Wendy’s capital investment and brand initiatives in 2020 with plans to build up to 18 new locations and modernize 24 locations across 16 states of operations.
Company 2020 Full-Year Financial Outlook: Robust Growth Ahead
- Sales growth of +20% to 25%
- Earnings from Operations growth of +20% to 25%
- Net Earnings growth of +15% to 20%
- EBITDA growth of +15% to 20%
- Dividend growth +17% to 33%
Meritage continues to distinguish itself as a leader and innovator in the QSR and Family Restaurant segments, striving for best in class results through a performance-based and employee-centric culture committed to operational excellence, strategic acquisitions and real estate development.
About Meritage
Meritage Hospitality Group is one of the nation’s premier restaurant operators, currently with 337 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. At fiscal yearend 2019, the Company had total weighted average fully diluted common shares outstanding of 9,032,790 and Fully Diluted EPS of $1.27.
The Company’s current and publicly available information as required under SEC Rule 15c2-11 and FINRA Rule 6432 can be found at www.otcmarkets.com, under the stock symbol MHGU\Disclosures or the Company’s website www.meritagehospitality.com.
SAFE HARBOR STATEMENT
Certain information in this new 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 at http://www.meritagehospitality.com.
CONTACT:
Robert E. Schermer, Jr., CEO
Meritage Hospitality Group Inc.
(616) 776-2600