Jollibee reports lower net income in Q1 2019
System wide sales were up by 18.1%.
Jollibee Foods Corporation (JFC) reported that its earnings dropped by 14.7% in Q1 2019, citing losses from acquired burger chain Smashburger.
JFC said in a statement that net income attributable to the parent fell to PHP1.54 billion (US $29.3 million), against PHP1.8 billion (US $34.3 million) in the same period a year ago, after the company consolidated Smashburger into its financial statements starting April 2018.
Without Smashburger, JFC said operating income would have grown 9.1% for the quarter.
Meanwhile, system wide retail sales firmed up 18.1% to PHP54.28 billion (US $1 billion), resulting in a 14.1% increase in revenues to PHP40.35 billion (US $769.4 million).
“Our financial performance in 2019 by quarter will be mixed. Our sales and profit performance in the first and second quarters will not be as strong in previous years…Our profit is also being affected by the performance of Smashburger in the United States,” JFC Chief Financial Officer Ysmael V. Baysa said in a statement.
JFC’s net income from the Philippines, which contributes 73% of the company’s system wide sales worldwide, grew 11.1% year on year.
“We look forward to sales and profit recovery in the third and fourth quarters as consumers in the Philippines slowly regain their purchasing power after being adversely affected by high inflation in 2018,” Baysa explained.
The company also committed to spend PHP17.2 billion (US $327.4 million) in capital expenditures this year, as it plans to open at least 500 new stores.
