Cost pressures pull down Jollibee income
Local fastfood giant Jollibee Foods Corp. (JFC) saw a 4.2-percent year-on-year decline in nine-month net profit to P2.06 billion due to cost pressures earlier this year.
But JFC’s net profit for July to September alone grew by 4.1 percent to P741 million from a year ago as margins started to improve in the past months.
The company reported that third quarter revenue rose by 19.1 percent year on year as system-wide sales—a measure of all sales to consumers—grew at the fastest pace so far this year at 18.4 percent.
Domestic sales growth of 19.7 percent was spearheaded by Chowking, Red Ribbon and Mang Inasal.
On the other hand, sales from foreign businesses grew by 13.5 percent, led by China where business grew by 21.4 percent. Sales in Vietnam and the Middle East also respectively expanded by 23.1 percent and 23.6 percent, partly making up for the slack in the United States.
JFC chairman and CEO Tony Tan Caktiong said the faster sales growth in the Philippines was driven by continued improvement in product quality and value offering across the brands and by the continued expansion of chicken restaurant chain Mang Inasal.
“We look forward to offering our consumers even better products and value proposition in the months ahead as we gain from the strength of our marketing, product research and development and supply chain,” Tan Caktiong said.
Mang Inasal grew its store network to 400, now matching the size of Chowking as the country’s largest fastfood brand next to flagship Jollibee, which has 733 stores.
For the first nine months of the year, JFC’s revenues and system-wide sales grew by 16.6 percent.
Meanwhile, JFC chief finance officer Ysmael Baysa noted that profit margins improved in the third quarter due to stabilizing raw material prices, price adjustments and cost management.
