MTY Food Group Inc Q2 2021 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Vishal Shreedhar - National Bank Financial, Inc., Research Division - Analyst : I just wanted to follow up on some of the questions asked earlier, particularly on inflation. I was noticing that inflation at restaurants, in general, seems to be meaningfully higher than inflation at grocery stores. And I'm wondering if you -- in general, if you agree with that perspective for your banners? And number two, if as a result of this higher inflation at restaurants, if you see the restaurant sector eventually grabbing back all the shares that have lost to grocery stores, is that viable? Or is that still on the open?

Question: Vishal Shreedhar - National Bank Financial, Inc., Research Division - Analyst : Okay. And continuing along the same theme. I noticed that the grocery stores are seeing a little bit more pressure year-over-year in their recent months. But the food processing business at MTY seems to still be doing quite well. So wondering what you attribute that to? Is it market share gains? Is it new products? And how should we think about that business going forward?

Question: Vishal Shreedhar - National Bank Financial, Inc., Research Division - Analyst : Okay. And hoping to expand upon your thoughts on acquisitions. Has this pandemic changed the way MTY thinks about acquisitions? And when you talked about your sweet spot earlier, wondering what is your sweet spot in terms of region of acquisition? In terms of types of acquisitions that turn around? Is it a larger chain? Smaller chain? Is there any more color you can give us on what constitutes a good deal for MTY?

Question: Vishal Shreedhar - National Bank Financial, Inc., Research Division - Analyst : Okay. And maybe lastly, you commented that Papa Murphy's performance flowing -- flung a little bit subsequent to quarter end, if I got that right. I was just wondering if you could comment on some of the initiatives -- the improvement initiatives you implemented at the brand? And whether you're pleased with those initiatives? If they're working or not in your estimation? And what next brands should we anticipate MTY to roll out its improvement initiatives, too? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 09, 2021 / 12:30PM, MTY.TO - Q2 2021 MTY Food Group Inc Earnings Call

Question: George Doumet - Scotiabank Global Banking and Markets, Research Division - Analyst : Congratulations on a strong quarter. I just wanted to ask about the store openings, so the 61 in the quarter. Eric, can you maybe give us a little bit of flavor in terms of what's being opened by maybe by banners or by geographies? Maybe some flavor there.

Question: George Doumet - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. And maybe focusing on the closures, they're obviously lower than what we've seen in the past. But I'm just wondering to what extent do you think that will pick up again when the aid -- the government aids subsides or continues to subside into the fall?

Question: George Doumet - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. Great. And just going back to your commentary about Papa Murphy's kind of moving steam, exiting the quarter. Obviously, there's a COVID hangover. But I'm just wondering how much of that is maybe due to aggressive promotions we're seeing by some of our more delivery-focused competitors in the pizza category? And do you guys, at all, plan on responding to that?

Question: George Doumet - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. And just last one for me, Eric. On the credit reversals that you guys called out, do you have that number for this quarter? How much the total number was? And maybe, I guess, more importantly, maybe if you look at Q3 and Q4, should we expect similar level of reversals, like half the reversal this quarter? Anything you can give us there would be appreciated.