MONTREAL, Dec. 11, 2018 /CNW Telbec/ - MTY Food Group Inc.
("MTY" or the "Company") (TSX: MTY) announced today that one of its wholly-owned subsidiaries has signed an agreement to acquire
the assets of South St. Burger (www.southstburger.com), a chain of gourmet burger restaurants.
The South St. Burger network currently has 26 franchised and 14 corporate restaurants in operation, most of which are located
in Canada. The network has generated over $28 million in system
sales in the last 12 months.
Eric Lefebvre, CEO of MTY, said: "MTY is proud to add another dynamic brand to its portfolio.
South St. Burger has great growth potential for the future and will solidify MTY's presence in the gourmet burger market."
The transaction is anticipated to close within the next 90 days but remains subject to multiple conditions customary for a
transaction of this nature. There is no assurance the transaction will be completed as described above, or at all, or that
the anticipated closing date will materialize.
Financing
Total consideration for the transaction will be financed using MTY's cash on hand and existing credit facilities.
Non?IFRS Measures
This News Release makes reference to certain non?IFRS measures. These measures are not recognized measures under IFRS, do not
have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other
companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further
understanding of the Company's results of operations from management's perspective. Accordingly, they should not be considered in
isolation nor as a substitute for analysis of the Company's financial information reported under IFRS. The Company uses non-IFRS
measures including "System Sales" to provide investors with supplemental measures of its operating performance and thus highlight
trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. The Company also
believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of
issuers. The Company's management also uses non-IFRS measures in order to facilitate operating performance comparisons from
period to period, to prepare annual operating budgets, and to determine components of management compensation.
"System Sales" represents the net sales received from restaurant guests at both corporate and franchise restaurants including
take-out and delivery customer orders. System Sales includes sales from both established restaurants as well as new restaurants.
Management believes System Sales provides meaningful information to investors regarding the size of MTY's restaurant network, the
total market share of the Company's brands and the overall financial performance of its brands and restaurant owner base, which
ultimately impacts MTY's consolidated financial performance.
Forward looking information
Certain information in this News Release constitutes "forward-looking" information that involves known and unknown risks,
uncertainties, future expectations and other factors which may cause the actual results, performance or achievements of the
Company to be materially different from any future results, performance or achievements expressed or implied by such
forward-looking information. When used in this News Release, this information may include words such as "anticipate",
"estimate", "may", "will", "expect", "believe", "plan" or variations of such words and phrases, or by the use of words or phrases
which state that certain actions, events or results may, could, would, or might occur or be achieved. In particular, this
News Release contains forward-looking information regarding: the completion of the acquisition, the potential closing date of the
acquisition and the potential impact of the acquisition on the Company's future operations; opportunities, growth and expansion;
the suitability of the acquisition by the Company; the effect of the acquisition on South St. Burger stakeholders; the potential
retention of South St. Burger management team; the expected EBITDA, revenue, system sales and potential growth of the combined
entity; potential future acquisition opportunities; and the continuing payment of dividends by the Company. This
forward-looking information reflects current expectations and assumptions regarding future events and operating performance and
speaks only as of the date of this News Release. These assumptions include, but are not limited to: currency
exchange rates used to derive Canadian dollar expectations; market acceptance of the acquisition; the satisfactory fulfilment of
all of the conditions precedent to the acquisition; the receipt of all required approvals and consents including regulatory, TSX,
shareholder and any other approvals; acceptable financing to complete the acquisition; future results of the South St. Burger
business and operations meeting or exceeding historical results; the success of the integration of the operations and management
team with the Company's operations and business; and market acceptance of potential future acquisitions by the Company.
Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual
results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied
by such forward-looking information. Such risks and other factors may include, but are not limited to: currency exchange
rates, general business, economic, competitive, political, capital market and social conditions and uncertainties; the intensity
of competitive activity, and the resulting impact on our ability to attract customers' disposable income; our ability to secure
advantageous locations and renew our existing leases at sustainable rates; the arrival of foreign concepts; our ability to
attract new franchisees; changes in customer tastes, demographic trends and in the attractiveness of our concepts, traffic
patterns, occupancy cost and occupancy level of malls and office towers; the level of consumer confidence and spending and the
demand for, and prices of, our products; our ability to implement our strategies and plans in order to produce the expected
benefits; events affecting the ability of third-party suppliers to provide to us essential products and services; labour
availability and cost or the loss of key individuals; stock market volatility; operational constraints and the event of the
occurrence of epidemics, pandemics and other health risks; delay or failure to receive board or regulatory approvals; changes in
legislation affecting the Company. Expected EBITDA, revenue, system sales and growth could vary due to fluctuations in
currency exchange rates.
A description of additional assumptions used to develop such forward-looking information and a description of additional risk
factors that may cause actual results to differ materially from forward-looking information can be found in the disclosure
documents on the SEDAR website at www.sedar.com. Readers are
further cautioned not to place undue reliance on forward-looking information as there can be no assurance that the plans,
intentions or expectations upon which they are placed will occur. Forward-looking information contained in this News Release is
expressly qualified by this cautionary statement. Except as required by law, the Company assumes no obligation to update or
revise forward-looking information to reflect new events or circumstances. Financial outlooks contained in this News Release were
approved by management of the Company on December 10, 2018. The purpose of this information is to
provide a potential financial outlook of the combined entity and this information may not be appropriate for other
purposes. Additional information is available in the Company's Management Discussion and Analysis, which can be found on
SEDAR at www.sedar.com.
On Behalf of the Board of Directors of
MTY Food Group Inc.
_____________________________________
Eric Lefebvre, Chief Executive Officer
SOURCE MTY Food Group Inc.
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