Jollibee earnings surge 29%

MANILA, Philippines - Higher same-store sales and new branches allowed fastfood giant Jollibee Foods Corp. (JFC) to jack up its earnings in the first quarter.

In a regulatory filing, JFC said its net income grew 29 percent to P881 million from P682 million a year ago.

Its continuous network expansion amid increasing demand will allow the country’s largest fastfood chain to post healthy sales growth this year, the company’s top official said.

“In the Philippines, practically all same-store sales growth came from increased volume from higher consumer visits,” said JFC CEO Tony Tan Caktiong.

“The healthy growth of the economy and election spending also contributed to our strong sales performance,” he added.

“Strong same-store sales growth and improvement in operating margin drove significant increase in profit,” JFC said.

Systemwide sales, a measure of all sales to customers both in company-owned and franchised stores, picked up 10.6 percent to P23.83 billion in the first three months of the year.

The fastfood giant’s Philippine business expanded 9.7 percent while China grew 18.9 percent, Southeast Asia and Middle East, 22.9 percent. US sales, however, declined 0.7 percent.

JFC said it enjoyed stable commodity prices and low inflation rates, allowing it to keep prices stable.

For this year, JFC committed to spend P5.5 billion to put up 300 new stores across all its brands here and abroad like in Indonesia and China. The company is banking on higher consumer spending, new stores and election spending to grow its sales anew this year.

“Our planned network expansion in 2013, along with strong same-store sales performance should enable us to achieve healthy sales growth both in the Philippines and abroad for the balance of the year,” said JFC chief finance officer Ysmael Baysa.

JFC operates the largest fastfood service network in the Philippines with 2,090 branches composed of 783 flagship Jollibee branches, 389 Chowking, 197 Greenwich, 228 Red Ribbon, 464 Mang Inasal and 29 Burger King.

The foreign operations of JFC has 562 stores: Yonghe King with 306 stores, Hong Zhuang Yuan with 46 and San Pin Wang with 39, all in China; 94 Jollibee, 31 Red Ribbon, 43 Chowking, and three Chow Fun located in US, Southeast Asia and the Middle East.