Yeah I read it... News on Meritage Hospitality Group Reports Stronger Second Quarter Earnings On 13% Sales Increase
GRAND RAPIDS, Mich., June 18 /PRNewswire/ -- Meritage Hospitality Group Inc. (OTC Bulletin Board: MHGI - news), the nation's only publicly held Wendy's franchisee, today announced net sales for the second quarter ended May 31, 1999 increased 12.5% to $7,528,000, compared to $6,691,000 during the same period last year. The Company's net earnings increased 2.4 times to $224,000 or $0.04 per share, compared to net earnings of $66,000 or $0.01 per share for the same period last year.
The Company's net sales for the first six months of fiscal 1999 increased 10.3% to $14,021,000 compared to $12,714,000 during the same period last year. The Company's net earnings for the six months were $235,000 or $0.04 per share, compared to a loss of $1,134,000 or $0.27 per share during the same period last year.
Commenting on the Company's results, Robert E. Schermer, Jr., Meritage's President, stated, ''Our second quarter results confirm that our business strategy is effective. We remain committed to our five year Wendy's expansion plan previously announced. In the first half of 1999, we will have added three new Wendy's restaurants to our system. During the balance of the year, we expect to open both traditional free standing and non-traditional restaurants. Our non-traditional restaurants combine a full service Wendy's restaurant with a Meijer convenience store and gas station facility.''
Schermer added, ''In addition to the new stores, our results reflect a same store sales increase of 7.4% during the first half of fiscal 1999. We attribute the sales increase to a strong economy and a more balanced supply/demand environment in the quick service restaurant segment.''
Meritage's operating cash flow (EBITDA) for the second quarter increased 1.7 times to $628,000 from $233,000 for the same period last year. Operating cash flow for the six month period increased 6.9 times to $910,000 from a negative operating cash flow of $154,000 for the first half of fiscal 1998.
Meritage currently operates 27 Wendy's restaurants throughout Western and Southern Michigan. In addition to being quoted on the OTC Bulletin Board, Meritage is listed on the Chicago Stock Exchange.
Meritage Hospitality Group Inc. and Subsidiaries
Consolidated Statements of Operations
For the Three Month Periods Ended May 31,
(Unaudited)
1999 1998
Food and beverage revenue $7,527,506 $6,690,794
Costs and expenses
Cost of food and beverages 2,178,904 1,953,142
Operating expenses 4,355,593 3,882,603
General and administrative expenses 365,463 621,735
Depreciation and amortization 324,853 309,265
Total costs and expenses 7,224,813 6,766,745
Earnings (loss) from operations 302,693 (75,951)
Other income (expense)
Interest expense (339,001) (371,253)
Interest income 119,422 158,989
Other income --- 518,239
Gain on disposal of assets 140,592 ---
(78,987) 305,975
Earnings from continuing operations 223,706 230,024
Loss from discontinued operations --- (164,270)
Net earnings 223,706 65,754
Dividends on preferred stock 10,017 31,137
Net earnings on common shares $213,689 $34,617
Earnings (loss) per common share -
basic and diluted
Continuing operations $0.04 $ 0.04
Discontinued operations --- (0.03)
Net earnings $0.04 $0.01
Weighted average shares
outstanding - basic 5,747,404 5,006,008
Weighted average shares
outstanding - diluted 5,900,365 5,006,008
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