Pancake House earnings down to P31.75 M in Q1

MANILA, Philippines - Costlier operations and more expensive raw materials cut through the earnings of listed restaurant chain Pancake House Inc., which is now a part of the Max’s Group of Companies.

Pancake House said net income attributable to equity holders of the parent firm slipped by nearly a quarter to P31.75 million in the first three months from P41.56 million a year ago.

Consolidated revenues rose 4.81 percent to P926.73 million from P884.19 million.

“The growth was attributed to a sustained growth in same base store sales and increase in store network by 4.54 percent or 22 stores to 310 stores as of Mar. 31, 2014 from 288 stores as of March 2013,” Pancake House said.

Specifically, store sales rose 4.54 percent to P778.20 million while commissary sales climbed 11 percent to P120.93 million in the first quarter.

However, franchise revenues, or the continuing license fee and franchise income, dropped 12 percent to P27.59 million “due to lesser number of franchise stores opened this quarter versus last year,” Pancake House said.

But costs and expenses grew faster than revenues, increasing 6.4 percent to P895.45 million from P841.52 million.

For instance, cost of sales increased six percent to P340.1 million from P320.85 million “due to increase in the price of Japanese rice caused by importation problem,” the company said.

Consolidated operating expenses jumped nearly 10 percent to P292.68 million from P266.23 million “mainly attributable to change in electricity and LPG rates, heavy repairs in stores, and increase in local tax rates on some cities and municipalities,” Pancake House said.

As of end-March, the listed firm had 310 co-owned and franchised stores: 114 Pancake House, 15 Dencio’s Bar and Grill, 37 Teriyaki Boy, 16 Sizzlin’ Pepper Steak, 14 Le Coeur de France, two Chicken Rice Shop, 109 Yellow Cab and three Maple.

“The company’s clear vision is to dominate the casual dining industry in the Philippines and significantly penetrate the international market in the next five years,” Pancake House earlier said.

Following a board meeting last week, the company’s directors approved the increase in authorized capital stock to P4 billion from P400 million that will be funded by stock dividends.

To cover the capital hike, Pancake House declared a 100-percent stock divident amounting to 259.21 million common shares at a par value of P1 each.