GRAND RAPIDS –– Meritage Hospitality Group Inc. continues on a growth trajectory, even after feeling the effects of a devastating hurricane last month.
The Grand Rapids-based Meritage (OTCQX: MGHU), a franchisee of Wendy’s locations around the country and operator of casual sit-down restaurants, reported record third-quarter sales of $110.9 million, an increase of 28.1 percent from the same period last year. Earnings from operations grew 58.8 percent from a year ago to $6.3 million, according to a statement from the company.
Meritage Hospitality executives say the sales growth reflects the success of the company’s acquisition spree last year.
“The Company’s record sales in the third quarter were driven primarily by the successful integration of newly acquired and renovated restaurants,” Meritage Hospitality CEO Robert Schermer said in a statement.
Schermer noted that Hurricane Florence created some challenges last month for the company, as several Wendy’s restaurants it owns on the Eastern Seaboard were forced to close for more than a week due to flooding.
Going forward, the company plans to continue allocating capital to renovating older Wendy’s locations it owns, while also adding to its existing portfolio of 311 restaurants in 16 states. Executives believe they’ll close out the year with continued sales growth of 40 percent to 50 percent.
“We believe our newly built, reimaged and acquired Wendy’s will continue to provide significant long-term earnings catalyst, as we execute our 420-restaurant growth plan,” Schermer stated. “During the fourth quarter, we are planning to open a new Wendy’s restaurant every ten days for the remainder of the year.”