Max’s Group, Inc. (MGI), the Philippines’ largest casual dining restaurant group, reported a net income of P392 million for the first half of 2021, a turnaround from its P603 million first-half loss last year.
In a disclosure to the Philippine Stock Exchange, the firm said net income amounted to just P15 million in the first half after being normalized to exclude one-offs booked mostly in the first quarter of 2021.
For the first half of 2021, MGI recorded total system wide sales of P5.75 billion, a 3 percent increase versus the P5.59 billion performance of 2020, which includes the pre-pandemic months of January and February.
Comparatively, revenues softened by 4 percent to P3.62 billion, as compared to the P3.79 billion reported for first half of 2020.
“We are heartened by the resilience demonstrated by our powerhouse portfolio of most -loved brands in protecting consumer relevance, even with headwinds against us,” said MGI President and Chief Executive Officer Robert Ramon F. Trota.
He noted that, “Despite ongoing challenges both locally and internationally, including heightened restrictions in the front-end of the second quarter, we take pride in the growth surge we achieved.”
“In fact, our total first-half sales via our Delivery channel nearly doubled pre-pandemic levels, even as the government allowed customers to return to Dine-In throughout much of these first six months. This proves the strongly-entrenched demand for the brands we operate,” Trota said.
This positive turn-out in financials reflected aggressive business remodeling initiated by the Group in 2020 to retool for the “new normal.” Versus pre-pandemic, gross margin improved by 100 bps or 3 percent and operating income margin was up by 140 bps or 18 percent versus the first half of 2019.
“We committed to our stakeholders that MGI would continue to represent financial viability and strong shareholder value as we accelerated three years of strategy into three quarters of execution,” said MGI Group Chief Operating Officer Ariel P. Fermin.
He added that, “Even in a volatile, uncertain market, the rigorous reinvention of our operations has yielded us significant improvements in profitability, designed to outpace any flex in system wide sales.” “Our contribution margins in the second quarter are back to pre-COVID levels; by June, we steered our monthly fixed costs to nearly half of what they used to be,” said Fermin.
He noted that, “Strategic management of our total supply chain, continued strong alliances with our lessor partners, margin management in our menus to combat raw material inflation, and efficiencies in our restaurant systems have all combined to create a business model that clearly works even with the tempered revenues in a pandemic. We believe that we are uniquely primed to come roaring out of this pandemic once the market opens up.”