Shakey’s Q1 net income dips 35%

MANILA, Philippines — Shakey’s Pizza Asia Ventures Inc. (SPAVI)  ended the first quarter with a 35 percent drop in net income to P114 million due to a challenging environment brought about by the coronavirus disease 2019 or COVID-19.

SPAVI will cut its capital spending by 70 percent and suspend new store openings for the year.

Systemwide sales were flat at P2.3 billion as the company was forced to temporarily suspend operations of majority of its stores due to mall closures, limited public transportation, and the presence of checkpoints following various quarantine guidelines.

SPAVI president and chief executive officer Vicente Gregorio said the company implemented several operating adjustments - including limiting the menu, shortening store hours and reducing and reshuffling the workforce.

During the second half of March, SPAVI only had nine percent of its network operational out of a total of 280 outlets - comprised of 249 Shakey’s and 31 Peri stores - servicing delivery and carry-out.

“The temporary closure of a significant number of our stores, combined with the impact of operating leverage and various fixed costs, dampened our bottom line during the period. We expect the second quarter to be worse, possibly the most challenging I’ve experienced in my career as we feel the full effects of limited operations and incremental costs due to the crisis,” Gregorio said.

But the company has re-opened some of its stores to cater to both delivery and carry-out.

“Today, almost all of our stores have re-opened, with each one implementing the necessary physical distancing measures and World Health Organization guidelines,” Gregorio said.

According to the company, 37 percent of its systemwide sales were generated via delivery and carry-out.