By James A. Loyola
Jollibee Foods Corporation (JFC), the largest Asian food service company, reported a 17.3 percent hike in attributable net income to P1.8 billion in the first quarter of 2018 from P1.53 billion in the same period last year.
In a disclosure to the Philippine Stock Exchange, the firm said its system wide sales, a measure of all sales to consumers both from company-owned and franchised stores grew by 19.3 percent to P45.98 billion in the first quarter of2018 from P38.54 billion a year ago.
Of this growth rate, global store network expansion accounted for 10.0 percent, same store sales contributed 7.6 percent and currency exchange rate changes added 1.7 percent. Same-store sales growth pertains to restaurants that were already open for at least 15 months. It excludes sales growth from new store opening.
The consolidation of the Super Foods Group contributed 2.8 percent to the 19.3 percent sales growth.
Philippine brands reported a 16.5 percent growth in system-wide sales compared to the first quarter of 2017 from continued strong same store sales growth, price adjustments implemented in 2017 and in January, 2018 and more product purchase per customer.
JFC also attributes the strong same store sales growth to its continuous product improvement, new product introductions, marketing campaigns, and restaurant renovations.
The foreign business reported a 16.7 percent growth (up 30.8 percent, with SuperFoods) in system-wide sales, with China growing by 17.9 percent, EMEAA (Europe, Middle East and Asia ex-SuperFoods) by 22.6 percent and North America by 8.5 percent.
“Same store sales growth in the Philippines remained strong and better than forecast, reflecting the country’s strong GDP growth rate,” said JFC Chief Financial Officer Ysmael V. Baysa.
He added that, “all key countries: Philippines, China and North America delivered slightly above 8 percent same store sales growth. Operating profit of businesses in the Philippines grew by 18 percent versus the same quarter last year.” Gross profit margins in the Philippines were only slightly below year-ago level despite rising inflation rate and cost increases brought by the tax reform and the peso depreciation.
“JFC’s gradual price adjustments which started in 2017 supported the profit margins. We expect Philippine gross profit margins to equal year-ago level by the fourth quarter of 2018,” said Baysa.