Max’s Group posts increase in recurring income

Miguel R. Camus
@miguelrcamusINQ

Max’s Group Inc., one of the country’s largest restaurant operators, said recurring profit were sharply higher in the first half of the year, with gains from the removal of most pandemic restrictions overcoming inflationary pressures.

Net income from January to June reached P281 million. This was down from P392 million in the same period last year, which included a one-off gain worth P377 million.

Removing the effects of the sale, “organic” income was up 18 times from the same period in 2021 as systemwide sales jumped 41 percent to P8.1 billion.

“Relaxation of dine-in restrictions from February onwards caused a significant boost in sales of dine-in brands Max’s Restaurant and Pancake House, supporting the performance of other core brands Yellow Cab Pizza Co. and Krispy Kreme, whose resilience in both delivery and take-out keyed the Group’s performance earlier on in the pandemic,” Max’s said in a stock exchange filing on Tuesday.

Total revenues rose 38 percent to P4.98 billion in the first half. The company said international sales were also up 27 percent.

The restaurant group said margins were also protected despite climbing raw material prices during the period, reflecting “historic highs” from the prepandemic period.

Max’s noted that its commissary provides “end-to-end upside across procurement of raw materials, manufacturing, and logistics, all of which contributed to tight controls in the company’s cost of sales.”

Gross profit margins in the first semester reached 34.7 percent, higher than the 27.7 percent in the first half of 2019.

“We are cautiously pleased with the results of the group throughout 2022 thus far,” Max’s president Ariel P. Fermin.

“Even with a very muted January that set a challenging tone for the start of the year, the business revolution we orchestrated throughout the pandemic continues to bear fruit in how our organization runs, how our brands perform, how our economic model delivers profit,” he added.

Max’s ended June with with 597 Philippine restaurants and 63 stores in North America, the Middle East, and the rest of Asia.