Jollibee’s 1st-semester net profit in rises by 21% to P1.59B

MANILA, Philippines—The homegrown fast-food giant Jollibee Foods Corp. grew its first-semester attributable net profit by 21.2 percent to P1.59 billion on the back of improved margins as well as higher sales in the Philippines and foreign businesses.

System-wide sales, a measure of all sales to consumers both from company-owned and franchised stores, went up by 13.5 percent in the first semester to P44.5 billion. In the second quarter alone, system-wide sales expanded by 12.1 percent.

In the second quarter year on year, the Philippine business reported a 9.5 percent growth in system-wide sales while foreign business grew by 24.7 percent, with China growing by 30.9 percent. Southeast Asia grew by 22.5 percent and the United States by 13.3 percent.

The Jollibee group opened a total of 91 new stores in the first semester, of which 51 were in the Philippines and 40 were overseas.

JFC’s net operating income in the second quarter amounted to P1.07 billion, growing by 7.8 percent year on year.

Net income attributable to equity holders of parent increased by 33 percent year on year to P921 million in the second quarter alone.

JFC’s profit margin after tax improved from 4.6 percent of revenues in the second quarter of 2011 to 5.3 percent of revenues in the second quarter of this year.  For the first semester, the margin increased to 4.8 percent from 4.6 percent in the same period in 2011.

Ysmael Baysa, JFC chief finance officer, said healthy same store sales growth in most regions driven by higher volume and cost improvement as well as lower financing costs and tax savings helped the company grew its net profit.  In its China businesses, he said, the key challenges were same store sales growth as well as higher cost of labor, rent and utilities.

Baysa added that JFC has been closely watching price trends particularly of corn, wheat, soybean and rice, which have risen significantly in the past two and a half months.

During the previous global commodity price spike in 2008, JFC had to adjust its selling prices higher over a period of time to compensate for the cost increases.