MTY Food Group reports Q1 profit up, acquisitions help revenue more than double

The Groupe MTY offices are seen in Montreal on January 23, 2020. THE CANADIAN PRESS/Ryan Remiorz

Republished April 12, 2023 - 8:05 AM

Original Publication Date April 12, 2023 - 4:26 AM

MONTREAL - MTY Food Group Inc. reported a first-quarter profit of $18.4 million, up from $16.6 million a year earlier, as acquisitions helped its revenue more than double.

The restaurant franchisor said Wednesday s its profit amounted to 75 cents per diluted share for the quarter ended Feb. 28, up from 68 cents per diluted share a year earlier.

Revenue at MTY totalled $286.0 million for the quarter, up from $140.5 million in the same quarter last year, while system sales totalled a record $1.36 billion, up from $885.7 million.

MTY said the increase in revenue was mainly due to recent acquisitions in the United States.

“Our acquisitions of Wetzel’s Pretzels and Sauce Pizza and Wine during the quarter, along with the earlier BBQ Holdings transaction, largely contributed to 69 per cent year-over-year growth in system sales in the U.S. market," MTY CEO Eric Lefebvre said in a statement.

"On the Canadian side, we delivered 32 per cent system sales growth as the business rebounded from pandemic-related restrictions in the first quarter last year."

During a call with analysts, Lefebvre said the company is expecting continued growth this spring.

"We need patio season to start for sales to go up in some of our concepts," he said. "It's a slow start to spring so far."

The recent power outage in Quebec affected several of the company's restaurants, Lefebvre said.

While some restaurants lost power and were closed for several days, others with power "crushed it during the weekend and ran out of food," he said.

"As far as the power outage in Quebec is concerned, a lot of our restaurants were affected, some very positively and some very negatively," Lefebvre added.

MTY franchises and operates restaurants under more than 85 different banners in Canada, the United States and internationally.

At the end of its first quarter, MTY's network had 7,128 locations in operation, including 6,895 that were franchised or under operator agreements and 233 corporate locations.

This report by The Canadian Press was first published April 12, 2023.

Companies in this story: (TSX:MTY)