Foreign stores to make up half of Jollibee sales by 2017

MANILA, Philippines – Fastfood giant Jollibee Foods Corp. (JFC) expects its overseas operations to account for half of total sales by 2017, a top company executive said.

JFC chief finance officer Ysmael Baysa said the group’s international businesses currently contribute 20 percent of groupwide revenues and are seen to rise to 25 percent in the next two to three years, and further to 50 percent by 2017.

He said the group’s plan to derive equal revenue contributions from foreign and local businesses would take three more years, from an earlier announced schedule of 2014 to due to delays in the completion of acquisitions.

Out of JFC’s total store network of 1,953 as of Sept. 30 this year, 1,578 are located in the Philippines while 375 are abroad.

China operations accounted for 12 percent while the US comprised six percent of JFC’s total systemwide sales as of the third quarter.

JFC posted the highest growth rate in Vietnam with 95.1 percent, followed by the Middle East with 36.8 percent; China, 23.5 percent; and United States, 12.4 percent.

Baysa said gross profit margins abroad are higher than in the Philippines due to higher consumer price points and lower raw material costs.

He said the group remains on the lookout for opportunities abroad, particularly in India, as part of an ambitious plan to scatter 3,000 Jollibee outlets outside the Philippines by 2020.

Baysa said the company has enough cash to fund its acquisitions and will tap the debt market only when up for a big acquisition.

In the nine months ending September this year, JFC reported a 16.3 percent hike in net earnings to P2.14 billion as systemwide sales edged up by 9.7 percent to P50.79 billion. Foreign sales rose 16.8 percent while domestic sales improved by 8.3 percent.

In the third quarter alone, JFC’s net profit grew 32.6 percent to P712 million on strong sales of its flagship Jollibee brand. Systemwide sales, a measure of all sales to consumers both from company-owned and franchised stores, rose to P16.88 billion from P15.33 billion a year ago.