MTY Reports Third Quarter Results For Fiscal 2026, Announces End of Strategic Review and Increases Dividend by 35%
Key Highlights
- ➤Quarterly dividend increases 35% to $0.50 per share from $0.37
- ➤MTY ends strategic review, prioritizing buybacks, portfolio optimization, and asset-light franchising
- ➤Q3 net income falls to $24.8 million, or $1.08 per diluted share
- ➤Normalized adjusted EBITDA declines to $60.8 million from $74.0 million
- ➤Same-store sales decrease 1.9%; international sales fall 9.1%
- ➤MTY closes 74 net locations, including 50 corporate stores
Expert Statements
Eric Lefebvre, Chief Executive Officer of MTY
“During the third quarter, our franchising segment showed impressive resilience despite facing continued pressure on consumer spending and a challenging operating environment.”
Eric Lefebvre, Chief Executive Officer of MTY
“Despite these headwinds, our asset-light and diversified model continued to generate strong free cash flows, and we remained focused on executing our strategic plan.”
Eric Lefebvre, Chief Executive Officer of MTY
“Following the announcement last quarter that we would be closing corporate locations representing roughly 1% of our network, we closed 50 locations during the third quarter, with the remainder of the planned closures anticipated to happen during Q4.”
Eric Lefebvre, Chief Executive Officer of MTY
“This is a decisive step to address underperforming assets and improve the overall quality of our corporate store portfolio.”
Eric Lefebvre, Chief Executive Officer of MTY
“While this action will reduce our store count in the near term, we believe it will strengthen the business over the long term by reducing losses and allowing us to focus resources on our strongest opportunities.”
Eric Lefebvre, Chief Executive Officer of MTY
“We remain committed to disciplined execution, strong cash generation and creating long-term value for shareholders.”
Eric Lefebvre, Chief Executive Officer of MTY
“MTY is at an inflection point, well positioned to harvest the benefits of the investments made over the last two years in our new ERP, which was delivered on time and on budget, as well as in our data infrastructure and systems architecture.”
Eric Lefebvre, Chief Executive Officer of MTY
“We've also taken decisive action to strengthen our corporate restaurant portfolio and have begun franchising strong-performing restaurants, continuing our evolution toward the pure-play, asset-light franchisor that has long been the foundation of our success.”
Eric Lefebvre, Chief Executive Officer of MTY
“Our balance sheet is healthy, our cash generation remains strong, and we are entering this next phase with the discipline and focus needed to create lasting value.”
GAAP Measures: * Segment profits were $59.9 million during the 13-week period ended August 30, 2026 (the "third quarter"). * Net income attributable to owners of $24.8 million, or $1.08 per diluted share compared to $27.9 million, or $1.22 per diluted share in Q3-25. * Cash flows provided by operating activities decreased 4% or $1.4 million to $37.6 million compared the same period in 2025. * Long-term debt repayments of $14.0 million for the quarter with net repayments of $61.2 million since Q3-25. Management Key Performance Indicators: * Free cash flows net of lease payments((2) )were $28.5 million or $1.25 per diluted share compared to $25.8 million or $1.13 per diluted share in the same period in 2025. * 74 net store closures during the 13-week period of which 50 were related to the corporate store closures announced in the second quarter. Corporate store locations now represent 2.6% of the network compared to 3.6% last year. * Normalized adjusted EBITDA((1)) of $60.8 million during the 13-week period. * Normalized adjusted EBITDA and EBITDA margins for the franchising and processing, distribution and retail segments remained inline with prior year. Of note, franchising EBITDA increased by 1% with margins stable at 54%. Corporate store profitability was impacted by a decline in sales for some concepts as well as by the strategic closure project announced last quarter. * Adjusted earnings per share((1)) of $1.26 per diluted share compared to $1.19 in the same period in 2025. * System sales((3)) remained steady at $1.5 billion during the third quarter compared to last year. * Same-stores sales((3)) decreased by 1.9% during the third quarter with Canada remaining relatively flat to prior year, the US segment decreasing by 2.7% and International segment decreasing by 9.1%. ((1)) This is a non-GAAP measure. Please refer to the “Non-GAAP Measures” section at the end of this press release . ((2)) See section “Definition of supplementary financial measures” found at the end of this press release. ((3)) See section “Definition of non-GAAP ratios” found in the Supplemental Information section for definition.
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