Core Insights - MTY Food Group reported a normalized adjusted EBITDA of CAD 87.7 million for Q4, a 48% increase year-over-year, primarily due to a one-time CAD 29.5 million increase in gift card breakage income from unredeemed balances [1][6] - The company ended fiscal 2025 with positive net unit growth for the first time since 2013, adding 19 locations in Q4 [4][5] - Free cash flow per share reached CAD 5.68, marking the strongest cash generation in the company's history [12][13] Financial Performance - Same-store sales declined by 1.7% in Q4, with Canada flat and the U.S. down 2.8% [2] - Net income attributable to owners was CAD 32.1 million, or CAD 1.40 per diluted share, improved due to a prior year's impairment loss and current year's gift card breakage [11] - Cash flow from operations was CAD 46.2 million, up from CAD 43.7 million year-over-year, while free cash flow increased by 38% to CAD 37.6 million [13] Operational Highlights - Franchise operations in Canada saw a 1% revenue increase, while U.S. operations experienced a decline, aligning with same-store sales trends [7] - Corporate store segment profit was CAD 7.9 million, a 23% year-over-year increase, with margins improving from 5% to 7% [9] - The food processing, distribution, and retail segment achieved a revenue growth of 27%, driven by a shift in the retail model [10] Strategic Focus - Management is prioritizing long-term investments to enhance guest and franchisee experiences [2] - The company is undergoing a strategic review, which is ongoing but does not have a defined timeline [15] - MTY expects franchisee EBITDA growth to outpace same-store sales growth as it adds higher-quality stores [8]

Core Viewpoint - Canada-based MTY Food Group is exploring a potential sale with the assistance of Toronto-Dominion (TD) Bank, as reported by Reuters [1] Company Overview - MTY Food Group operates a network of 7,061 units across North America and internationally, with 256 units owned by the company and the remainder operated by franchisees [1] - The company owns a diverse portfolio of restaurant brands, including Pinkberry and Cold Stone Creamery, and manages over 80 chains such as Wetzel's Pretzels, Papa Murphy's, and TacoTime [1] Financial Performance - MTY's market value is approximately $550 million, and any potential buyer would likely need to offer a premium over this valuation [2] - For the third quarter of 2025, MTY reported a net income attributable to owners of $27.9 million, a decrease of about 20% from $34.9 million in the same quarter the previous year, translating to $1.22 per diluted share compared to $1.46 [2] - The company's revenue increased roughly 1% year-on-year to $297 million [3] Leadership and Ownership - Stanley Ma, the chairman of MTY, founded the business in 1979 and holds a 13.9% stake, making him the largest shareholder [3] - Ma served as CEO from 2004 until 2018 [3] Recent Acquisitions - MTY Franchising USA, a subsidiary of MTY, acquired Wetzel's Pretzels in 2022 from CenterOak Partners [3] - The company also completed the purchase of BBQ Holdings in 2022 for $200 million, at a price of $17.25 per share, which took BBQ Holdings private [4]