Leading local casual dining chain Max’s Group Inc. (MGI) turned unprofitable in the first quarter due to disruptions caused by the coronavirus pandemic, prompting the group to streamline operations and put on hold new store openings for the rest of the year.
MGI ended the quarter with a net loss of P169.28 million, a reversal of the net income of P138.57 for the same period last year. Three-month consolidated revenues declined by 18.8 percent year-on-year to P2.72 billion.
System-wide sales, comprised of sales generated by both company-owned and franchised stores, decreased by 12.9 percent year-on-year to P3.99 billion during the first quarter.
“With the safety of all our stakeholders as a top priority, we have ensured that security and health protocols remain bolstered at every aspect of our business. The cumulative impact of temporary store closures, dine-in restrictions and various fixed costs have resulted in a swift reversal from last year’s performance. We anticipate that this trend will continue through the second quarter as well,” MGI president and chief executive Robert Trota said on Wednesday.
The local COVID-10 outbreak in March reversed the upswing in business seen in the first two months. In January, system-wide sales grew by 8.2 percent, accompanied by a same-store sales growth of 1.9 percent. In February, system-wide sales and same-store sales likewise grew by 9.1 percent and 2.3 percent, respectively.
Starting mid-March, in line with the government’s enhanced community quarantine guidelines for COVID-19, MGI was forced to cease operations in malls and operate stand-alone stores only for delivery and take-away options. To reinforce containment, sanitation and safety procedures for commissaries, stores and offices, MGI temporarily paused all operations from March 26 to April 4.
At present, MGI has re-opened 573 stores representing 76 percent of its total store network. In the last months, MGI has rationalized menu offerings for each of its brands, while optimizing inventory and growing its delivery and take-away channels.
The group has in its portfolio household name brands such as Max’s Restaurant, Yellow Cab Pizza Co., Krispy Kreme and Pancake House,” he added. —Doris Dumlao-Abadilla