Shakey’s Philippines net profit grows to P843M in 2018

MANILA, Philippines — The country’s leading pizza parlor chain operator Shakey’s Pizza Asia Ventures Inc. grew its net profit last year by 10 percent to P843 million as it managed to expand its same-store sales despite a high-inflation environment that gnawed on consumer sentiment.

System-wide sales last year rose by 12 percent, sustaining the double-digit growth momentum in the previous year. Combined company-owned and franchised stores hit sales of P9.36 billion, driven primarily by the opening of 20 new stores locally that brought its Philippine store count to 228 as of end-2018, Shakey’s disclosed to the Philippine Stock Exchange on Wednesday.

Excluding the impact of new outlets, same-store sales growth likewise remained healthy at 4 percent, in line with the company’s annual target of 3 to 5 percent. This was amid what the company described as a challenging period in the second half of 2018 as higher inflation weakened consumer sentiment.

Shakey’s president and chief executive officer Vicente Gregorio said: “2018 marks our 15th year of consecutive double-digit sales growth. The sustainability of our expansion is a commendable feat by all measures. Last year, however, was especially challenging given the headwinds in consumer spending and the continued entry of new competitors in the dining out space. Thankfully, we managed to weather these due to a loyal brand following, various value-for-money promotions, new product launches, and the reliable service execution that Shakey’s has always been known for.”

In 2018, Shakey’s total revenues grew by 8 percent to P7.58 billion. Gross profit was up by 4 percent to P2.16 billion, translating to a 100-basis point drop in gross profit margins to 28.5 percent. The decline was attributed to various cost pressures, including higher raw material prices and a weakened local currency, combined with the impact of various sales-supporting initiatives.