JOLLIBEE FOODS Corp. (JFC) is eyeing to grow its sales this year through the aggressive expansion of its operations to offset the significant increase in the cost of raw materials that threatens to cut full-year profit.
Officials on Friday said profits this year were so far behind targets, despite a more than 10-percent growth in gross earnings. In the first quarter of the year, JFC’s net profit fell 8.8 percent, although sales rose by 14 percent.
“The second quarter is tracking better than the first. We are hoping this continues until the end of the year,” JFC chief finance officer Ysmael Baysa said.
“Our actual performance is still below target because of the increase in the costs of raw materials, particularly poultry, rice, sugar and flour,” Baysa said.
Sales growth has also been behind expectations following a dip in consumer confidence due to higher fuel prices. Crises in the Middle East and Japan have also weighed down on remittance-driven spending of Philippine consumers.
Baysa said the company’s goal was to post higher profit or at least match 2010 levels this year, banking on the country’s improving economic prospects and the continuous expansion of its network of stores.
JFC also hopes that the prices of raw materials will stabilize by the fourth quarter of the year.
JFC operates in the country through five “quick-service restaurant” brands, namely, Jollibee, Chowking, Greenwich, Red Ribbon and its recent acquisition, Mang Inasal.
Its second biggest market is China, where JFC is present through two brands, namely, Yonghe King and Hong Zhuang.
“We’re still hoping for a better profit performance this year,” JFC chair and founder Tony Tan Caktiong told reporters at the sidelines of the firm’s annual shareholders’ meeting.
JFC ended 2010 with 2,316 stores around the world, up by 23 percent from the year before. Its yearend 2010 profit hit P3.2 billion, up by 20.5 percent.