Max’s Group, Inc., the largest casual dining restaurant group in the Philippines, reported that its net income almost doubled to P42 million in the first quarter of 2022, despite one month of strict lockdown in January, from P22 million in the same period last year.
“The improved economic model of MGI amplified by an especially strong recovery in March allowed the Group to sustain profitability in the first quarter of 2022 with margins close to pre-pandemic levels despite headwinds faced in January,” the firm said in a disclosure to the Philippine Stock Exchange.
MGI posted first quarter systemwide sales—comprised of sales generated by both company- owned and franchised stores—of P3.55 billion and revenues of P2.17 billion.
These reflect comparable indices of 125 percent and 118 percent, respectively, versus the same period in 2021.
Local sales were still tempered as a result of the strict lockdown in January due to the Omicron surge, while international business continues to flourish, surpassing even pre-COVID levels.
March demonstrated significant growth in sales with a 14 percent month-on-month increase as restrictions on dine-in were loosened further.
The Group’s core brands Max’s Restaurant, Pancake House, Yellow Cab Pizza Co., and Krispy Kreme all realized upsides with the relaxed restrictions, and are expected to further realize gains as dine-in continues to surge amidst heightened mobility.
The Group posted same store sales growth of 23 percent in the first quarter of 2022 and is expected to further recover the rest of the year, proving the organic strength of its deep, diverse portfolio of powerhouse brands.
Revenues, which comprise of restaurant sales, commissary sales, franchising, and other revenue, increased by 18 percent to P2.17 billion from P1.84 billion in the first quarter of 2021.
“Our results for the first quarter, even more markedly so in March, are an indication of strong demand for our brands and patronage of our core of core, which are available both in traditional brick-and-mortar spaces, and expanded to business-to-business and off-premise platforms,” said MGI Chief Executive Robert Ramon F. Trota.
Given ongoing relaxation of government restrictions, dine-in which contributes healthier margins vis-à-vis other consumption channels, contributed to the Group’s recovery, while reaping the benefits of its strengthened off-premise channels that continue to protect and provide upsides in its topline.
“As planned, our dine-in brands Max’s and Pancake House, which have been managed for profitability during the pandemic, realized significant growth towards the back-end of the quarter. We are expecting that as the market continues to open up, the recovery of these brands will be even more vibrant, giving our margins a boost,” added Trota.
MGI President Ariel P. Fermin said “We also continue to expand our reach and market not only though brick-and-mortar stores but across all available channels, such as cloud kitchens, retail outlets, and e-commerce platforms.”
He noted that, “We are cautiously optimistic in the transformative possibilities for MGI, both for the balance of this year and over our next 3-5 year runway. The execution of our strategy will have long-term benefits for the Group as we nurtured demand from our fans, while crafting an economic model surpassing the margins of our pre-pandemic levels.”