Jollibee net income down, builds record 303 stores in 2015

The bottom line of local fast-food giant Jollibee Foods Corp. (JFC) fell by double-digits for the fourth quarter and the full-year of 2015, as the listed company incurred extraordinary expenses after opening a record number of stores.

JFC said its net income for the last three months of 2015 dropped 45.8 percent to P960.987 million from P1.774 billion the same period in 2014, while total comprehensive income fell 73.2 percent to P527.777 million from P1.966 billion.

This, according to the company, was due to the more than 300 stores it opened last year.

“We are pleased to have opened 303 stores in 2015. This is the highest number of store opening in a single year in JFC’s history. The new stores are performing well, particularly those in the Philippines, exceeding their target sales and return on investments,” JFC CEO Ernesto Tanmantiong said in an emailed statement.

“These are marks of the strong health of the brands and of JFC’s increased organization capability,” he added.

For the fourth quarter, revenues rose 11.9 percent to P27.875 billion from P24.917 billion and expenses grew 26.4 percent to P3.968 billion from P3.139 billion.

“JFC’s operating income excluding extra-ordinary cost items would have grown by 20.9 percent for the fourth quarter of 2015 versus the same period a year ago, and by 4.8 percent for the entire year of 2015. These extra-ordinary expense items totalling P903 million resulted in a decline in operating income,” the company said.

This brought the full-year net income to P4.926 billion, 10.2 percent down from the P5.488 billion in 2014. Total comprehensive income also fell 16.2 percent to P4.751 billion from P5.666 billion.

“We expect margins to improve further in the months ahead as we experience the benefits of lower commodity prices. Our 2015 net income was adversely affected by significant short term costs amounting to almost P1.0-billion,” JFC CFO Ysmael V. Baysa said.

Baysa attributed these costs to the upgrades in the company’s information technology, the increase in network development organization, the acquisition of Smashburger, and the extra supply chain and logistics costs.

“These are necessary investments that are helping make possible JFC’s short and long term sales and profit growth. We do not expect the same rate of expense increases in 2016. We look forward to a strong profit recovery in 2016 and in the years ahead,” he said.

For 2015, JFC’s revenues were up 11.2 percent to P100.782 billion from the previous year’s P90.671 billion while expenses increased by 14.4 percent to P12.363 billion from P10.806 billion.

The company ended the year with a total of 2,475 operating restaurant outlets in the country: Jollibee (916); Chowking (439); Greenwich (231); Red Ribbon (374); Mang Inasal (459), and Burger King (56).

Looking forward, the company said that it “plans to continue to make substantial acquisitions in the coming years.”

Shares of JFC on Monday fell P0.80 or 0.38 percent to P209.60 apiece. — BAP, GMA News