MTY Food Group Inc.
TSX VENTURE : MTY

MTY Food Group Inc.

October 13, 2005 15:17 ET

MTY Food Group Inc.: Third Quarter Results

MONTREAL, QUEBEC--(CCNMatthews - Oct. 13, 2005) - MTY Food Group Inc. (TSX VENTURE:MTY), franchisor and operator of over 428 quick service restaurants, with annual system-wide sales of over $100 million, under the banners of: Tiki Ming, Sukiyaki, La Cremiere, Cultures, Thai Express, Mrs. Vanellis, Pad Thai, Veggirama, Caferama, Au Vieux Duluth Express, Carrefour Oriental, Panini Pizza Pasta, Chick 'N' Chick, Franx Supreme, Croissant + Plus, Villa Madina and its most recent acquisition TCBY, reported its operating results for the nine-month period ended August 31, 2005.

MTY is pleased to announce net income for the nine-month period ended August 31, 2005 of $2.98 million or $0.19 per share compared to net income of $1.72 million or $0.11 per share for the same period last year, representing an outstanding increase of 73%.

For the quarter ended August 31, 2005, net income was $1.32 million or $0.08 per share, compared to $0.84 million or $0.06 per share for the same period last year, representing an impressive increase of 57%.

Included in the statement of income is a charge of $196,550 pertaining to the stock option compensation for the nine-month period ended August 31, 2005. There was no such expense for the same period last year.

Total revenues increased by 20% to $12.96 million for the nine-month period ended August 31, 2005 as compared to $10.81 last year.

Revenue from franchise locations increased by 31% to $10.21 million for the nine-month period ended August 31, 2005 from $7.78 million for the same period last year.

Earnings before income taxes and non-controlling interest increased to $4.63 from $2.72 million, representing an increase of 70% for the nine-month period ended August 31, 2005 compared to the same period last year.

The increase in earnings for the third quarter is attributable to the additional revenue from new outlets that have opened within the last year, the positive response to our revamped menus at the Mrs. Vanelli's locations, and the good weather we experienced this past summer has also had a great impact on the sales of the La Cremiere locations

MTY is in a strong cash-flow position. As at August 31, 2005, MTY had cash, term deposits and short-term notes, and marketable securities totaling $10.27 million compared to $5.5 million for the previous year. The increase is attributable to the positive cash-flows from operations as well as the proceeds of $3.5 million resulting from the subscription of 1 million shares.

On September 28, 2005, MTY completed the acquisition of the business assets of Les Aliments Tremlac Canada Ltee. which operated under the name of "The Country's Best Yogurt" (TCBY) for an all cash consideration of $1.3 million.

Management is aggressively but prudently looking for future growth opportunities in the restaurant and franchising sector.

On Behalf of the Board of Directors of

MTY Food Group Inc.

Stanley Ma, Chairman, President & CEO

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

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