Jollibee profit slides by 50.2% on Smashburger losses

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MANILA, Philippines – Fast-food giant Jollibee Foods Corp. saw a 34.4 percent year-on-year drop in attributable net profit in the first semester to P2.66 billion, dragged down by losses from American hamburger chain Smashburger.

For the second quarter alone, net profit slid by 50.2 percent year-on-year to P1.1 billion. Aside from losses from American hamburger chain Smashburger, extraordinary manufacturing expenses related to Red Ribbon’s transition to a new plant gnawed on the company’s earnings.

Six-month revenues increased by 9.8 percent year-on-year to P79.52 billion, driven by systemwide sales which rose by 13.8 percent to P59.43 billion. However, revenue growth was outpaced by the 12.8 percent increase in direct costs to P70.86 billion alongside general and administrative expenses as well as advertising expenses which increased by 12.7 percent year-on-year to P10.26 billion.

Six-month net interest expenses also doubled to P651.34 million.