MTY Reports Second Quarter Results for Fiscal 2025

Core Viewpoint - MTY Food Group Inc. reported its financial results for Q2 2025, highlighting a mixed performance across its geographical segments, with challenges in the U.S. market contrasted by strong results in Canada. The company is implementing strategic initiatives to enhance guest experiences and improve profitability in its Corporate segment [2][3][18]. Financial Highlights - Revenue for Q2 2025 was $304.9 million, slightly up from $303.7 million in Q2 2024 [4][11]. - Adjusted EBITDA for Q2 2025 decreased to $69.3 million from $73.2 million in Q2 2024, while normalized adjusted EBITDA was $70.0 million, down from $73.7 million [4][11]. - Net income attributable to owners increased significantly to $57.3 million, or $2.49 per diluted share, compared to $27.3 million, or $1.13 per diluted share in Q2 2024 [4][11]. - Cash flows from operations were $40.2 million, a slight decrease from $40.6 million in Q2 2024 [4][18]. - Free cash flows net of lease payments were $23.6 million, down from $24.3 million in Q2 2024, but per diluted share increased to $1.03 from $1.01 [4][11]. Segment Performance - The franchise segment's normalized adjusted EBITDA increased by 3% to $54.0 million, while the Corporate segment saw a decline in normalized adjusted EBITDA to $11.3 million, down $5.5 million year-over-year [4][11][12]. - System sales for Q2 2025 reached $1.46 billion, a modest increase of 0.3% compared to Q2 2024, with a 1% decrease in the U.S. segment offset by a 3% growth in Canada [5][11]. - Same-store sales decreased by 1.9% year-over-year, with Canada growing by 1.4% and the U.S. declining by 3.8% [11][12]. Operational Insights - As of the end of Q2 2025, MTY operated 7,046 locations, with a stable geographical split of 57% in the U.S., 35% in Canada, and 8% internationally [11][19]. - The company opened 76 new locations during the quarter but closed 77, resulting in a net decrease of one location [11][19]. - Digital sales increased by 3% to $296.7 million compared to $287.7 million in Q2 2024 [5][11]. Dividend Declaration - MTY declared a quarterly dividend of $0.33 per share, payable on August 15, 2025, to shareholders registered by August 5, 2025 [2][15].