Jollibee posts 20.4% income growth in 9 months

MANILA, Philippines - Jollibee Foods Corp.  (JFC) the country’s largest food service company, posted nine-month net earnings of P2.47 billion, up 20.4 percent from the same period in 2011on the back of improved margins and higher sales in both domestic and foreign businesses.

In a statement, JFC said its system-wide sales, a measure of all sales to consumers both from company-owned and franchised stores, increased 13 percent to P66.92 billion while revenues, which pertain to sales from company-owned stores and commissaries and royalty income from franchised stores, rose 15 percent to P51.5 billion.

In the third quarter alone, JFC reported a net profit of P881.7 million, 18.9 percent higher than the previous year as system-wide sales climbed 12.1 percent to P22.42 billion.

The company said sales growth was broad-based and volume driven resulting from better-value-for-money recognition by consumers on its products and services. Sales of Philippine brands rose 9.6 percent while businesses overseas grew 22.6 percent.

The China business expanded 26.5 percent, the US by 12.6 percent and the Southeast Asia and Middle East region up a combined 24.7 percent.

JFC generated a gross profit margin of 17.9 percent in the third quarter, the highest level achieved in the past six quarters as a result of a slight decrease in the prices of raw materials, cost improvement projects at its commissaries in the Philippines, and greater cost efficiency of restaurants in the Philippines where sales per store grew faster than expenses.

Revenues likewise grew much faster than general and administrative expenses behind cost improvement programs at JFC’s head offices in the Philippines and China. Advertising and promotion expenses in the third quarter of 2012 were also lower as percent of revenues due to a more cost efficient marketing expenditure system.