Asset sales pushed Jollibee’s first-quarter profit up 1,400%

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Fast food giant Jollibee Foods Corp. (JFC) of billionaire Tony Tan Caktiong reported a surge in profits in the first quarter, mainly due to one-time income from the sale of real estate, while its restaurants continued their recovery from the pandemic crisis.

In a Thursday filing, JFC said net profit from January to March soared more than 1,400% to 2.31 billion pesos.

This was after the company posted a 1.8 billion peso gain from land transfers to CentralHub industrial hubs, a subsidiary of DoubleDragon Properties Corp. of Tan Caktiong, and other real estate assets.

New points of sale

“The land transfer is part of JFC Group’s plan to invest in CentralHub, which JFC’s board of directors approved on July 7, 2021. CentralHub is an industrial real estate company,” the company said. in his file.

JFC’s first-quarter revenue also rose 23.6 percent to 42.86 billion pesos, thanks to better sales and the opening of new outlets.

System-wide sales, including those at franchise stores, also increased by 25.5% to nearly P60 billion.

JFC said inflationary pressures such as higher oil prices and raw material costs were weighing on margins, which were “slightly below the level of the previous year”. It supported earnings with price increases last year and in the first quarter of 2022.

“Costs are accelerating due to rising inflation and large-scale supply chain challenges. JFC will take the necessary steps to protect its margins, including implementing cost improvement initiatives and revenue management,” Richard Shin, JFC’s ​​chief financial officer, said in the filing.

JFC continued to expand during the quarter with the opening of 107 new stores and the closing of 58 outlets.

“Despite the challenges posed by the increase [COVID-19 cases caused by the Omicron variant] in some markets where JFC operates and the increase in raw material and energy prices, our business performed well and even set a new sales record for a first quarter,” said the company’s CEO, Ernesto Tanmantiong, on file.

—MIGUEL R. CAMUS

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