Meritage Reports First Quarter 2025 Results; Reaffirms Full-Year 2025 Earnings Outlook
GRAND RAPIDS, Mich., April 18, 2025 (GLOBE NEWSWIRE) -- Meritage Hospitality Group Inc. (OTCQX: MHGU), one of the nation's premier franchise operators, today reported financial results for the first quarter ended March 30, 2025.
First Quarter Highlights:
Sales were $154.5 million compared to $162.8 million for the same period last year.
Earnings (loss) from Operations were $(3.7) million compared to $3.9 million for the same period last year, resulting from multiple severe weather-related closures.
Net Earnings (loss) were $(4.3) million compared to $1.6 million for the same period last year.
Consolidated EBITDA (a non-GAAP measure) was $2.2 million compared to $9.9 million for the same period last year.
'As previously reported, Company sales and earnings were significantly impacted by atypical weather that impacted all of its markets during the first quarter of the year, with severe weather events in its southern US markets that resulted in decreased consumer traffic and numerous temporary restaurant closures from record snow, ice and floods. Looking ahead, we are reaffirming our 30% to 40% growth in diluted EPS for the full-year 2025, driven by robust new product offerings at Wendy's in the second half of the year, highlighting protein-led innovations and marketing collaborations', stated Meritage CEO, Robert E. Schermer, Jr.
During the second quarter, we are launching the Company's first restaurant location using Wendy's Fresh AI – the generative AI Bot technology that brings a digital automated ordering experience to the drive-thru customer. The Company is committed to leveraging technology and delivery options designed to improve customer experience as well as employee efficiency within the restaurants. The Company opened three new Wendy's during the first quarter and plans to open 7-10 new Wendy's through the remainder of the year as new unit-level economics continue to generate leading results, and higher guest frequency continues to reward us for contemporary restaurant designs and digital enhancements.
Morning Belle the Company's proprietary single shift, breakfast/brunch concept, reported a strong same store sale increase of +21.9% for the first quarter as compared to last year, outperforming industry segment trends. The Company plans to open 3-5 new Morning Belle locations during the year, as proof of concept continues.
2025 Outlook: Better Earnings Outlook Ahead:
Sales growth up to +3%
Earnings from Operations growth of +40% to +50%
Net Earnings growth up to +50%
EBITDA growth up to +15%
Diluted EPS growth of +20% to +30%
The Company is focused on leveraging its robust operating platform and unique in-house restaurant development expertise to deliver consumers the highest level of quality, convenience, and affordability. Acquisitions, renovations, and new restaurant development are integral parts of our restaurant business model.
The Company's five-year growth plan includes the acquisition and development of new Wendy's and Morning Belle restaurants. As we plan for the next generation of growth, including new capital partners, we remain actively engaged in planning for future strategic events to enhance shareholder value and liquidity.
About the Company:
Meritage Hospitality Group is the nation's premier restaurant operators, currently with approximately 381 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 across 15 States. The Company had 8,520,000 diluted weighted average shares outstanding as of fiscal year ended December 29, 2024.
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 STATEMENTCertain 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.
Robert E. Schermer, Jr.Meritage Hospitality Group Inc.(616) 776-2600 ext. 1012
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