Meritage Announces New Annual Meeting Date; Update on COVID-19 Impact and Looking Ahead
GRAND RAPIDS, Mich., April 16, 2020 (GLOBE NEWSWIRE) -- Meritage Hospitality Group Inc. (OTCQX: MHGU), one of the nation’s premier restaurant operators, today announced the Annual Meeting of Shareholders originally scheduled for May 19th will be postponed due to COVID-19 safety and health concerns. The Annual Meeting of Shareholders will now be held at 8:30 am EST on June 25, 2020. Accordingly, the record date for determining shareholders to vote has been postponed to April 30, 2020. Other information about the Annual Meeting will be included in proxy materials which we expect to mail to shareholders on or about May 21, 2020.
Actions Taken in Response to COVID-19
The Company has taken significant proactive measures to ensure it remains strong, resilient and well-positioned to support employees, guests and other stakeholders through the COVID-19 crisis. The following is a list of select actions:
- Reinforced our strict food safety procedures, personal hygiene standards, handwashing requirements and sanitation protocols across all restaurants;
- Suspended all non-essential capital expenditures;
- Suspended new restaurant development, with the exception of six new restaurants already near completion;
- Benefitted from extended payment terms for royalties and marketing funds offered by Wendy’s over the next 90 days;
- Negotiated near-term landlord rent relief;
- Requested interest-only loan payment terms from syndicate lenders for a period of 90 days;
- Suspended all stock dividends for 90 days or until business normalizes, whichever is earlier.
- Approved by the SBA for a $29.1 M loan through the Coronavirus Aid, Relief and Economic Security (CARES) Act under the Paycheck Protection Program (PPP).
“Our geographical footprint and drive-thru operations have allowed us to continue serving the changing needs of guests as people adapt to local government orders. We are grateful to our employees, delivery drivers and supply-chain operators for continuing to deliver essential restaurant food items,” stated CEO, Robert E. Schermer.
Company Business Performance
- 329 of our Wendy’s restaurants remain open for drive-thru and delivery service across 16 states of operations.
- Beginning mid-March, COVID-19 related dining room closures negatively impacted our Wendy’s sales by approximately 20% to 25%.
- Company sales for Q1 2020 are estimated be 7% over the same period last year.
- Q1 2020 sales growth was driven by record same store sales associated with the introduction of the Wendy’s breakfast, which continues to perform well.
- The Wendy’s restaurant supply chain is keeping pace with drive-thru and delivery sales demand.
- Many of our Wendy’s markets are now hiring additional employees.
- We are assessing and participating in relief programs offered by the stimulus CARES Act, many of which apply directly to the restaurant industry.
Looking Ahead: Resilient Business Model
While the restaurant industry is at the epicenter of government mandated closures, we believe the quick service segment and the Company have distinct advantages in the future economic recovery.
- Speed, convenience and affordability have been differentiators in quick service restaurant operations in past times of economic stress.
- Wendy’s restaurants are built for off premise sales, with approximately 70% of our normal sales generated through the restaurant drive-thru, which remain open and operating.
- The Wendy’s system offers digital and delivery options for additional off-premise sales.
- Lower gas prices decrease supply delivery costs and increase consumer disposable income.
- Low interest rates provide efficient capital for future growth opportunities.
Meritage continues to distinguish itself as a leader and innovator in the quick service restaurant segment, striving for best in class results through a performance-based culture committed to operational excellence, strategic acquisitions and real estate development.
About Meritage
Meritage Hospitality Group is one of the nation’s premier restaurant operators, with 337 restaurants located in Arkansas, Connecticut, Florida, Georgia, Indiana, Massachusetts, Michigan, Missouri, Mississippi, North Carolina, South Carolina, Ohio, Oklahoma, Tennessee, Texas and Virginia. Meritage is headquartered in Grand Rapids, Michigan, operating a workforce of approximately 11,000 employees. The Company has approximately 9.0 million total weighted average fully diluted common shares outstanding. The Company’s current public information is available pursuant to SEC Rule 15c2-11 and FINRA Rule 6432 at , under the stock symbol MHGU, or the Company’s website
SAFE HARBOR STATEMENT
Certain information in this press release, particularly information regarding future economic performance and finances, plans, expectations and objectives of management, and the impacts that the novel coronavirus COVID-19 pandemic may have on our business operations and financial condition, constitutes forward-looking statements. Factors set forth in our Safe Harbor Statement, in addition to other possible factors not listed, could affect the Company’s actual results and cause such results to differ materially from those expressed in forward-looking statements. Please review the Company’s Safe Harbor Statement at .
FOR IMMEDIATE RELEASE:
CONTACT: Robert E. Schermer, Jr., CEO
Meritage Hospitality Group Inc.
(616) 776-2600
