Jollibee income rises 14.6% to P2.66 billion in 2009

MANILA, Philippines - Fastfood giant Jollibee Foods Corp. reported a 14.6 percent growth in net income last year to P2.66 billion, backed by steady strong sales, lower raw material costs and income taxes, and efficient marketing spending.

In a financial report submitted to the Philippine Stock Exchange, Jollibee said revenues expanded 9.5 percent to P48.06 billion while system-wide sales, a measure of all sales to consumers both from company-owned and franchised stores, rose 9.6 percent to P63.73 billion.

In the fourth quarter of 2009, Jollibee posted a net profit of P813 million, up 23.1 percent from P661 million while its system-wide sales went up 5.4 percent to P17.44 billion.

Tony Tan Caktiong, chairman and chief executive officer of JFC, said: “In 2009, the company grew the business by almost 10 percent, achieved its net profit target and exceeded its cash flow objective. The results were strong overall, considering the stressed and changing economic conditions in markets where we do business.”

He said sales growth in the fourth quarter was healthy for most brands in the Philippines, China, Vietnam and the Middle East.

The business in the US, however, was adversely affected by weak consumer spending, he said.

“We look forward to a more robust growth in 2010 particularly in the Philippines and China as we now have there even better products, price points, store quality and marketing campaigns driven by even stronger organizations,” he said.

Tan Caktiong said Jollibee is allotting P4.8 billion this year for the continued expansion of its local and overseas operations and acquisition The amount is almost double the P2.5 billion spent in 2009.

He, however, was quick to point out that the company is prepared to significantly reduce its investment plans if economic conditions would warrant.

As of end-December 2009, the Jollibee Group opened a total of 168 stores worldwide – 110 in the Philippines and 58 overseas including 38 stores added from the acquisition of Hong Zhuang Yuan in Beijing.

Jollibee chief finance officer Ysmael Baysa said the fastfood firm opened fewer stores in 2009 as a matter of financial conservatism in the face of slowing economic growth.

The company also closed its Chun Shui Tang Tea House in Shanghai which was performing below expectations and terminated the Lao Dong joint venture in Taiwan due to a change of its expansion plans in China.

The Jollibee Group operates the country’s largest fastfood network with a total of 1,557 stores in the country: The flagship Jollibee brand (686), Chowking (399), Greenwich (226), Red Ribbon (207), Delifrance (24) and Manong Pepe’s (15).

It was also operating 325 stores abroad – Yonghe King in the People’s Republic of China 160 stores, Jollibee, 57 (mainly in the US with 27, Vietnam with 14 and Brunei with 11), Red Ribbon 35, all in the US, Chowking (32) mostly (mostly in the US with (16) and Dubai with 14 and Hong Zhuang Yuan (41) for a total of 1,882 stores worldwide.