Jollibee net income up 4.1% in third quarter

MANILA, Philippines - Fastfood giant Jollibee Foods Corp. (JFC) said its net earnings rose 4.1 percent in the third quarter this year to P741 million even as revenues grew a hefty 19.1 percent.

Revenues amounted to P15.23 billion as systemwide sales, a measure of all sales to customers both from company-owned and franchised stores, increased 18.4 percent to nearly P20 billion, the fastest growth registered so far in 2011.

Sales growth in the Philippines accelerated to 19.7 percent, led by oriental food chain Chowking which grew 13.2 percent; bakery unit Red Ribbon, 11 percent; and grilled chicken outlet Mang Inasal 8.2 percent.

Foreign operations grew 13.5 percent, spearheaded by China which rose 21.4 percent, Vietnam, 23.1 percent; and the Middle East, 23.6 percent, which partly offset a slowdown of sales in the US.

Tony Tan Caktiong, chairman and chief executive officer of JFC, said the acceleration of sales growth in the country was driven mainly by the continued improvement in product quality and product value offering across the brands and by the continued expansion of its latest acquisition Mang Inasal.

“We look forward to offering our customers even better products and value proposition in the months ahead as we gain from the strength of our marketing, product research and development and supply chain,” Tan Caktiong said.

As of of end-September 2011, Mang Inasal has expanded its branch network to 400, matching Chowking, the second largest fastfood chain in the country in terms of number of stores, behind flagship Jollibee with 733 branches.

For the nine months ending September this year, JFC reported a 4.2 percent drop in net profit to P2.056 billion even as revenues and systemwide sales rose 16.6 percent.

The group’s higher expenses due to the acquisition of Mang Inasal and the building of its China corporate organization and commissary weighed down on earnings.

But JFC chief financial officer Ysmael Baysa said profit margins had improved in the last two quarters resulting from stabilizing raw material prices, price adjustments and cost management.

The Jollibee Group opened a total of 171 new stores, boosting its total branch network to 1,946 nationwide. Overseas, it operates another 437 stores for a total of 2,383 stores worldwide.