Max's Group's net profit up 11% to $8.2m in Q3
Its restaurant sales rose 13% to US$148.4m driven by revenue contribution of new stores and healthy same store sales.
Max’s Group Inc. has announced its systemwide sales increasing 14% to US$246.3m for the nine months ended 2017 from US$216.7m for the nine months ended 2016. Blended same store sales growth was at 5% for the covered period. Commissary sales went up 5% to US$20m indicating stable performance of the franchising business. Meanwhile, revenues from new franchises, royalty and continuing license fees gained 8% to US$8.5m compared to US$7.8m for the nine months ended 2016 resulting from higher recurring income and new franchising contracts. EBITDA stood at US$19m leading to a net income of $8.2m, up 11% versus US$7.4m year-on-year.
Max's Group's president and CEO Robert Trota SAID, “The results underscore our steady growth state notwithstanding the effects of cyclicality, rising input costs and heightened competition. As we channel this momentum into the Christmas season, we are primed for another strong finish to cap off the year."
As of the third quarter, Max’s Group opened 58 new stores both domestically and abroad bringing its overall network to 660 branches. The Company plans to establish 10-15 additional outlets for the remainder of the year.
On the international front, MGI continues to broaden its footprint in various geographies around the globe. To date, the Company opened 11 new stores to shore up its existing count to 57 outlets scattered throughout North America, Middle East and parts of Asia. It also inked a number of fresh development agreements for a combined 31 future sites across loved brands Max’s Restaurant, Yellow Cab Pizza and Sizzlin’ Steak.
Since 2015, MGI has secured a committed pipeline of 126 stores of which 16 are currently operational. It intends to concentrate efforts on further accelerating store-building activities beginning next year.
“The success of recent store openings has taken franchising interest in our brands to an all-time high particularly in Asia. We also have the necessary structure in place to seize this opportunity. At present, we have deployed regional teams to provide quick and focused support for all our markets,” added Peter King, CEO for International.
For the period, MGI encountered challenging industry conditions such as commodity price escalations, increased competitive pressure and wet climate. Nonetheless, the Company capitalized on its operational scale to derive cost advantages, streamlined menu mix and tactical marketing campaigns to cushion price hikes and boost customer frequency.
“While we expect to close 2017 on a high note, we remain confident of our growth prospects heading into next year. We plan to rollout around 80-90 stores including 25-30 offshore for 2018,” concluded Trota.
