Jollibee says provincial reach around 15%

From AB Capital's The Opening Bell: Three Moves

Event

Management said that only around 15% of Jollibee's store network is currently located in provincial areas, highlighting that the bulk of its footprint remains concentrated in major cities and urban centers.

View

We view this as a positive long-term structural takeaway rather than an immediate earnings catalyst. While the domestic business is already highly penetrated in urban markets, a 15% provincial mix suggests management still sees substantial untapped demand. Combined with new formats and multi-brand expansion (e.g., Chowking, Mang Inasal, Greenwich, Coffee Bean, etc.), provincial growth could support sustainable same-store sales and unit expansion over the medium term. This also helps offset concerns that the Philippine business is approaching saturation.

Catalyst

The comment reinforces the long runway for domestic expansion. As infrastructure improves, incomes rise outside Metro Manila, and more secondary cities become commercially viable, JFC has significant white space to add stores across the Philippines. Provincial expansion also complements growth in delivery and digital ordering, which can improve the economics of new stores.

Action

Maintain positive stance on Jollibee Foods Corporation. The market remains focused on near-term margin recovery and the international business restructuring, but the low provincial penetration highlights an overlooked domestic growth driver. Investors should continue monitoring store rollout guidance, provincial same-store sales trends, and new store productivity, as successful execution could support higher long-term earnings growth and justify a stronger valuation for the Philippine business.

Disclaimer: The information, analyses, and views contained herein is based on sources which we, AB Capital Securities, believe are reliable, but is not guaranteed by us and is not to be considered all inclusive. It is not to be construed as an offer or solicitation of an offer to sell or buy the securities herein mentioned. AB Capital Securities and its Directors and Officers and/or members of their families may have a position in the securities herein mentioned and may make purchases and/or sales of the securities from time to time in the open-market and otherwise.