Rande
What are your thoughts on MHGI.(BB)..
Meritage Hospitality Group...Just reported good earnings
I don't own this...
Banchee
Meritage Hospitality Group Reports Earnings for
Fiscal Year Ended November 30, 1998
GRAND RAPIDS, Mich., Feb. 9 /PRNewswire/ -- Meritage Hospitality Group Inc. (OTC Bulletin Board: MHGI - news),
the Grand Rapids-based restaurant owner and operator, today announced net earnings of $1,131,000 or $0.21 per share for
the fiscal year ended November 30, 1998, compared to a net loss of $1,691,000 or $0.56 per share in the prior fiscal year.
Net sales for the fiscal year were $27,044,000 compared to $26,861,000 during the same period last year.
The Company's net earnings for the fourth quarter ended November 30, 1998 were $2,821,000 or $0.49 per share,
compared to a net loss of $17,000 or $0.01 per share in fiscal 1997. The net sales for the fourth quarter ended November 30,
1998 were $7,003,000 compared to $6,598,000 during the same period last year.
Robert E. Schermer, Jr., Meritage's President, stated, ''1998 was a pivotal year for the Company as we successfully
completed the previously announced plan of selling our under performing assets and shifting our focus to the rapid expansion of
our Wendy's franchise. The sale of these under performing assets, which included two full service hotels, caused significant non-
operating benefits to the 1998 results, consisting primarily of non-recurring pre-tax capital gains.''
Mr. Schermer added, ''Our development pipeline is the strongest it has been in our franchise history. We are now firmly
focused on expanding our Wendy's business through the development of new restaurants within our market area, and through
accretive acquisitions or joint ventures outside of our traditional market area.''
Meritage will be opening two new Wendy's restaurants (one in Grand Rapids and one in Holland, Michigan) within the six
weeks. Each store will employ approximately 40 people.''
The Wendy's franchise system is the third largest quick-service restaurant hamburger chain in the world with 5,266 units and
system-wide sales in excess of $6 billion. Meritage is currently the only publicly held ''Wendy's Old Fashioned Hamburgers''
restaurant franchisee in the United States. The Company operates 25 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 Months Ended November 30, 1998 and 1997
(unaudited)
1998 1997
Food and beverage revenue $7,002,616 $6,597,946
Cost and expenses
Cost of food and beverages 1,998,498 1,882,562
Operating expenses 3,852,771 3,752,032
General and administrative expenses 945,496 871,525
Depreciation and amortization 185,661 221,684
Total costs and expenses 6,982,426 6,727,803
Earnings (loss) from operations 20,190 (129,857)
Other income (expense)
Interest expense (376,490) (384,135)
Interest income 136,880 154,118
Other income (10,149) -
Loss on disposal of assets (25,000) (28,149)
Minority interest - (94,609)
Total other income (expense) (274,759) (352,775)
Loss from continuing operations
before income taxes (254,569) (482,632)
Income taxes - current 50,000 -
Loss from continuing operations (304,569) (482,632)
Discontinued operations (net of income tax)
Loss from operations - (836,178)
Gain on disposal of discontinued
operations 3,711,364 1,479,095
Earnings from discontinued
operations 3,711,364 642,917
Earnings before extraordinary item 3,406,795 160,285
Extraordinary item - loss on early extinguishment
of debt (no applicable federal income tax) 585,432 177,291
Net earnings (loss) 2,821,363 (17,006)
Preferred stock dividends 14,517 31,137
Net earnings (loss) on common shares $2,806,846 ($48,143)
Basic and diluted earnings (loss)
per common share $0.49 ($0.01)
Average shares outstanding 5,741,019 3,218,149
Meritage Hospitality Group Inc. and Subsidiaries
Consolidated Statements of Operations
For the Years Ended November 30, 1998 and 1997
1998 1997
Food and beverage revenue $27,043,954 $26,860,546
Cost and expenses
Cost of food and beverages 7,752,187 7,720,307
Operating expenses 15,647,438 15,856,833
General and administrative expenses 3,111,910 2,886,892
Depreciation and amortization 1,078,539 1,070,017
Total costs and expenses 27,590,074 27,534,049
Loss from operations (546,120) (673,503)
Other income (expense)
Interest expense (1,473,019) (1,440,192)
Interest income 184,614 592,850
Other income 509,590 -
Loss on disposal of assets (25,000) (218,602)
Minority interest 25,677 (195,639)
Total other income (expense) (778,138) (1,261,583)
Loss from continuing operations
before income taxes (1,324,258) (1,935,086)
Income taxes - current 50,000 -
Loss from continuing operations (1,374,258) (1,935,086)
Discontinued operations (net of income tax)
Loss from operations (479,232) (1,057,568)
Gain on disposal of discontinued
operations 3,711,364 1,479,095
Earnings from discontinued operations 3,232,132 421,527
Earnings (loss) before
extraordinary item 1,857,874 (1,513,559)
Extraordinary item - loss on early extinguishment
of debt (no applicable federal income tax) 727,172 177,291
Net earnings (loss) 1,130,702 (1,690,850)
Preferred stock dividends 107,928 101,714
Net earnings (loss) on common shares $1,022,774 ($1,792,564)
Basic and diluted earnings (loss)
per common share $0.21 ($0.56)
Average shares outstanding 4,932,738 3,214,836
SOURCE: Meritage Hospitality Group |
