Canada NewsWire
MONTREAL, Feb. 17, 2022
(1) | This is a non-GAAP measure. Please refer to the "Non-GAAP Measures" section at the end of this press release. |
(2) | This is a non-GAAP ratio. Please refer to the "Non-GAAP Ratios" section at the end of this press release. |
(3) | This is a supplementary financial measure. Please refer to the "Supplementary Financial Measures" section at the end of this press release. |
MONTREAL, Feb. 17, 2022 /CNW Telbec/ - MTY Food Group Inc. ("MTY", "MTY Group" or the "Company") (TSX: MTY), franchisors and operators of multiple restaurant concepts worldwide, reported today its results for the fourth quarter and fiscal year ended November 30, 2021.
"After nearly two years of navigating through the COVID-19 pandemic, the strength of our brands and sustainability of our business model, combined with the resilience of our franchisees and staff, allowed MTY to deliver robust financial results and further improve our balance sheet in fiscal 2021," said Eric Lefebvre, Chief Executive Officer of MTY. "We generated healthy free cash flows and profitability, highlighted by record adjusted EBITDA of $168.6 million in 2021."
"Altogether, system sales improved 5% year-over-year, as the entire team responded proactively to pandemic-related challenges along with global supply-chain and labour issues while capitalizing on opportunities such as the increased prevalence of digital sales and marketing. Although we faced significant quarterly variations in the US and Canada, annual system sales growth was relatively similar with increases of 6% and 4%, respectively, reflecting the depth and diversity of our North American network."
"In the fourth quarter, adjusted EBITDA increased 22% to $42.8 million, while system sales grew 8% over the same period last year," Mr. Lefebvre added. "We also reduced our long-term debt, paid out a quarterly dividend and repurchased shares under our NCIB program. Despite the ongoing pandemic and other temporary issues affecting MTY, our long-term growth strategy remains unchanged. We seek to deliver organic growth, based on a market recovery, investments in our network and a strong franchise pipeline, while searching for accretive acquisitions at reasonable valuations."
Financial Highlights (in thousands of $, except per | Q4-2021
| Q4-2020 | 2021 | 2020 |
Revenue | 146,285 | 127,163 | 551,903 | 511,117 |
Adjusted EBITDA(1) | 42,831 | 35,181 | 168,622 | 137,819 |
Net income (loss) attributable | 24,877 | 20,078 |
85,639 |
(37,108) |
Cash flows from operations | 31,898 | 44,841 | 139,299 | 133,652 |
Free cash flows(1) | 35,603 | 43,910 | 139,001 | 140,652 |
Free cash flows per diluted | 1.44 |
1.78 |
5.62 |
5.68 |
EPS basic | 1.01 | 0.81 | 3.47 | (1.50) |
EPS diluted | 1.00 | 0.81 | 3.46 | (1.50) |
System sales(3) | 962,500 | 891,400 | 3,631,300 | 3,459,100 |
Digital sales(3) | 193,700 | 194,200 | 803,600 | 636,400 |
(1) | This is a non-GAAP measure. Please refer to the "Non-GAAP Measures" section at the end of this press release. |
(2) | This is a non-GAAP ratio. Please refer to the "Non-GAAP Ratios" section at the end of this press release. |
(3) | This is a supplementary financial measure. Please refer to the "Supplementary Financial Measures" section at the end of this press release. |
FOURTH QUARTER RESULTS
Network:
Financial:
FISCAL 2021 RESULTS
Network:
Financial:
LIQUIDITY AND CAPITAL RESOURCES
NEAR-TERM OUTLOOK
The Company is closely monitoring the global situation surrounding COVID-19 and taking proactive steps to adapt to the changes for the well-being and safety of its employees, franchisees and customers, and the continuity of its operations and businesses. Given the dynamic nature of the situation, it is not possible to ascertain what impact there may be on the Company's long-term financial performance. MTY is taking the necessary steps to mitigate the potential consequences that this situation may have on its operations, franchisees, partners and service to MTY's customers. Please refer to the "Highlights of Significant Events" section of the Company's Management's Discussion and Analysis for the year ended November 30, 2021 ("MD&A") for further details on actions taken in response to COVID-19.
Despite the lingering impacts of the pandemic and the obvious obligations to address the related short-term challenges, management's focus is now shifting back to a longer-term growth perspective. Sales are back to pre-pandemic levels for many of the brands and progressing in the right direction for the others. The restaurant industry will remain challenging in the future, with labour shortages and supply chain disruptions being felt across the network, adding to the existing pressure of competing in a market approaching saturation. Management believes however that the brands' continued focus on innovation, product quality, consistency and store design combined with the adjustments made during the pandemic to adjust to new customer expectations positions the network well for the future.
Before the pandemic, MTY's objectives were to generate organic growth while actively seeking potential accretive acquisitions. Those objectives have not changed and remain at the center of MTY's actions. To the extent possible, MTY's teams are focused on helping franchise partners generate positive same-store sales, open new locations of existing concepts and ultimately achieve their profitability objectives. The individual success of franchisees is the basis for the success of MTY for the years to come. In the wake of COVID-19, MTY has diversified its sources of revenue by expanding into other sales channels, such as: launching multiple ghost kitchens in existing restaurant locations, thus benefitting from the synergies of shared costs, streamlined workflows as well as being able to respond to the increase in delivery and takeout orders; and launching new products in the retail division and expanding into new territories, in response to increased consumer spending in grocery stores that has continued throughout the waves of the pandemic.
Given the Company's capital allocation since the onset of the pandemic and the amount of debt that was repaid since, the Company is financially well positioned to seize acquisition opportunities that are presented to management. However, despite its appetite to make acquisitions and grow its network, the Company will remain disciplined in its search for the right acquisition targets, at the right price and with the right synergies. For further details, please refer to the Company's MD&A.
CONFERENCE CALL
The MTY Group will hold a conference call to discuss these results today at 8:30 AM Eastern Time. Interested parties can join the call by dialing 1-514-400-4402 (Montreal or overseas) or 1-800-399-9540 (elsewhere in North America). Parties unable to call in at this time may access a recording by calling 1-800-770-2030 and entering the passcode 4629934. This recording will be available today, as of 11:30 AM Eastern Time, until 11:59 PM Eastern Time on Thursday, February 24, 2022.
ABOUT MTY FOOD GROUP INC.
MTY Group franchises and operates quick-service, fast casual and casual dining restaurants under more than 80 different banners in Canada, the US and Internationally. Based in Montreal, MTY is a family whose heart beats to the rhythm of its brands, the very soul of its multi-branded strategy. For over 40 years, it has been increasing its presence by delivering new concepts of restaurants, making acquisitions, and forging strategic alliances, which have allowed it to reach new heights year after year. By combining new trends with operational know-how, the brands forming the MTY Group now touch the lives of millions of people every year. With 6,719 locations, the many flavours of the MTY Group hold the key to responding to the different tastes and needs of today's consumers as well as those of tomorrow.
NON-GAAP MEASURES
Adjusted EBITDA (net income (loss), excluding income tax, all other income (expenses), interest, depreciation and amortization, and net impairment charges), and free cash flows (sum total cash flows from operating activities less capital expenditures net of disposals) are widely accepted financial indicators but are not a measurement determined in accordance with International Financial Reporting Standards and may not be comparable to those presented by other companies. The Company believes that non-GAAP measures, non-GAAP ratios (defined below) and supplemental financial measures (defined below) are useful because they are consistent with the indicators management uses internally to measure the Company's performance, to prepare operating budgets and to determine components of executive compensation. The Company also believes that these measures are used by securities analysts, investors and other interested parties and that these measures allow them to compare the Company's operations and financial performance from period to period and provide them with a supplemental measure of the operating performance and financial position and thus highlight trends in the core business that may not otherwise be apparent when relying solely on GAAP measures. Refer to the "Compliance with International Financial Reporting Standards" section of the Company's MD&A.
NON-GAAP RATIOS
Management discloses non-GAAP ratios as they have been identified as relevant metrics to evaluate the performance of the Company. These include free cash flows per diluted share (free cash flows divided by diluted shares).
SUPPLEMENTARY FINANCIAL MEASURES
Management discloses supplementary financial measures as they have been identified as relevant metrics to evaluate the performance of the Company. These include system sales (sales of all existing restaurants including those that have closed or have opened during the period, as well as the sales of new concepts acquired from the closing date of the transaction and forward) and digital sales (sales made by customers through online ordering platforms).
FORWARD-LOOKING STATEMENTS
Certain information in this press release may constitute "forward-looking" information that involves known and unknown risks, uncertainties, future expectations and other factors, which may cause the actual results, performance or achievements of the Company or industry to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. This includes statements regarding the impacts that the novel COVID-19 pandemic may have on the Company's future operations as found in this release. When used in this press release, this information may include words such as "anticipate", "estimate", "may", "will", "expect", "believe", "plan" and other terminology. This information reflects current expectations regarding future events and operating performance and speaks only as of the date of this press release. Except as required by law, the Company assumes no obligation to update or revise forward-looking information to reflect new events or circumstances. Additional information is available in the Company's MD&A, which can be found on SEDAR at www.sedar.com.
Note to readers: The MD&A, consolidated financial statements and notes thereto for the fourth quarter and fiscal year ended November 30, 2021, are available on the SEDAR website at www.sedar.com and on the Company's website at www.mtygroup.com.
SOURCE MTY Food Group Inc.
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