Diversified Royalty Revenue Jumps 72.7% to $31.5 Million on Mr. Lube + Tires Deal

Diversified Royalty Corp. reported third-quarter 2026 revenue of $31.5 million, up 72.7% from $18.3 million a year earlier, according to GlobeNewswire. The Vancouver-based multi-royalty corporation acquires top-line royalty streams from franchisors across North America and operates the Mr. Lube + Tires franchisor business in Canada.

Diversified Royalty's Q3 Results and Mr. Lube + Tires

Combined contribution was $24.9 million in Q3 2026, up 27.2% from $19.6 million in Q3 2025. Distributable cash rose 21.9% to $15.5 million, and the payout ratio fell to 86.9% on dividends of $0.0716 per share, compared with 91.9% on dividends of $0.0688 per share a year earlier.

Mr. Lube + Tires system sales were $126.4 million in Q3 2026, a 1.7% decrease from $128.5 million in Q3 2025, as reported by Mr. Lube Canada LP. Same-store-sales growth was negative 5.1% for the quarter, compared with 11.2% in the comparative period in 2025. Mr. Lube + Tires adjusted EBITDA contribution to Diversified Royalty was $13.4 million in Q3 2026.

Sean Morrison, Chief Executive Officer of Diversified Royalty, said: "Inflation in fuel and other vehicle operating costs is leading people to drive fewer kilometres, which has reduced demand for oil changes and maintenance services." Morrison said Mr. Lube + Tires remains on track to open 18 new locations in 2026 and to meet the previously disclosed estimate of $58.7 million in adjusted EBITDA contribution for the twelve months following the acquisition.

Mr. Lube + Tires Deal and Funding Figures

Diversified Royalty completed its acquisition of the Mr. Lube + Tires franchisor business on June 16, 2026, according to akta.pro company records, at a gross purchase price of $235 million. As part of the transaction, management rolled $20.6 million of equity into the purchaser entity and retained approximately 4% interest post-transaction, the same records show.

On July 6, 2026, Diversified Royalty closed a bought deal public offering of 12,339,500 common shares at $4.66 per share for gross proceeds of approximately $57.5 million. On July 7, 2026, the company used partial net proceeds to make a $38.5 million principal paydown on its Acquisition Facility, reducing the balance to nil.

Dividends Declared Before the Results

Diversified Royalty announced a $0.02375 per common share cash dividend for October 2026, payable October 30 to shareholders of record as of October 15, equal to $0.285 per share on an annualized basis, the Financial Post reported. The company approved a $0.02375 per common share dividend for September 2026, payable September 29 to shareholders of record as of September 15, Yahoo reported.

Mr. Lube + Tires' 2027 Location Plans

Mr. Lube + Tires is budgeting 16 new locations for 2027 and is considering bolt-on acquisition opportunities, Morrison said. The business added 9 new locations to date, and Diversified Royalty said Mr. Lube + Tires experiences seasonality where the fourth quarter is typically the strongest.