Meritage Announces Fourth Quarter Dividend: Margin Improvements Forecasted In 2024

Rhea-AI Summary

Meritage Hospitality Group Inc. (MHGU) announces a quarterly special dividend of $0.06 per share, payable on January 1, 2024. The company reported third quarter sales of $170.3 million, with a 6.4% increase in Earnings from Operations. They plan to build 52 new Wendy's restaurants by 2026 and acquired 25 Wendy's restaurants in North Carolina and Virginia, expecting to add $42.0 million to annual sales.

Positive

• The company reported a 6.4% increase in Earnings from Operations, showing positive growth.
• The acquisition of 25 Wendy's restaurants in North Carolina and Virginia is expected to add approximately $42.0 million to annual sales, indicating potential for increased revenue and profitability.

Negative

• None.

GRAND RAPIDS, Mich., Nov. 08, 2023 (GLOBE NEWSWIRE) -- Meritage Hospitality Group Inc. (OTCQX: MHGU), the nation’s premier franchise operator, announced today the Company’s Board of Directors approved a quarterly special dividend of $0.06 per share. The dividend is payable on January 1, 2024, to shareholders of record as of December 15, 2023.

“The Company recently reported third quarter sales of $170.3 million as well as results from operations that included margin improvements related to food and labor, as a percentage of sales. Our key ongoing metric, Earnings from Operations, increased +6.4% over last year, and we believe that improvements in food and labor will continue throughout 2024 as the rate of inflation subsides and restaurant margins normalize. Consumer demand in our Wendy’s restaurants continues to demonstrate resiliency and new store opening sales remain robust,” stated Meritage CEO, Robert E. Schermer, Jr.

The Company has committed significant long-term capital resources to support Wendy’s brand initiatives, including an expanded agreement to build a total of 52 new Wendy’s restaurants by the end of 2026 under the Groundbreaker Incentive Program. Newly built and re-imaged Wendy’s restaurants continue to deliver strong sales as guests continue to reward us for upgraded restaurant facilities and improved overall customer experience.

The Company completed the acquisition of 25 Wendy’s restaurants in North Carolina and Virginia during the fiscal year and expects the additional restaurants to add approximately $42.0 million to annual sales and be accretive to earnings going forward.

Meritage continues to distinguish itself as a national leader and innovator in the quick service industry, 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 restaurant operator, currently with 385 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 12,000 employees. As of the third quarter ended October 1, 2023, the Company had fully diluted weighted average common shares outstanding of 8,271,000 and reported EPS of $0.46.

The Company’s current and publicly available information pursuant to amended 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 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 at http://www.meritagehospitality.com.

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

FAQ

What is the special dividend announced by Meritage Hospitality Group Inc. (MHGU)?

The company announced a quarterly special dividend of $0.06 per share, payable on January 1, 2024.

What were the third quarter sales reported by Meritage Hospitality Group Inc. (MHGU)?

The company reported third quarter sales of $170.3 million.

How many new Wendy's restaurants does Meritage Hospitality Group Inc. (MHGU) plan to build by the end of 2026?

The company plans to build a total of 52 new Wendy's restaurants by the end of 2026 under the Groundbreaker Incentive Program.

How many Wendy's restaurants did Meritage Hospitality Group Inc. (MHGU) acquire in North Carolina and Virginia?

The company completed the acquisition of 25 Wendy's restaurants in North Carolina and Virginia.