Fast-food giant Jollibee Foods Corp. turned unprofitable in the first quarter as the coronavirus pandemic bludgeoned its restaurants in China, the Philippines and other overseas markets.
JFC incurred a three-month attributable net loss of P1.79 billion, reversing the P1.46 billion net profit in the same period last year.
“JFC’s financial performance in 2020 will not be a good one. It will incur even higher losses in the second quarter when the full impact of the lockdowns on the business will be felt,” JFC chief financial officer Ysmael Baysa said in a disclosure to the Philippine Stock Exchange on Thursday.
“We expect the business to start recovering in the third and fourth quarters but we assume that the recovery will be slow.”
But Baysa said JFC’s strong balance sheet would allow the company to withstand the current storm, “even in worse case scenarios.”
System-wide sales grew by a modest 1.6 percent year-on-year to P55.15 billion as JFC had to shut down a high number of stores in mainland China, where the pandemic started, and eventually in the Philippines and other major markets abroad.
System-wide sales contracted by 32.5 percent in March from 15.7 percent in February this year due to the lockdown measures in China, the Philippines, US and other countries. As of end-March, 69 percent of stores in the Philippines were temporarily closed, while 6 percent of stores were closed in China, 16 percent in North America, and 23 percent in Europe and Middle East.
Excluding the impact of the consolidation of Coffee Bean & Tea Leaf (CBTL), JFC’s system-wide sales contracted by 10 percent year-on-year in the first quarter. As of end-March, 32 percent of CBTL stores were closed.
Revenues contracted by 2.3 percent to P39.43 billion in the first quarter.