Jollibee Foods Corporation (JFC), one of the largest Asian food service companies, is investing P20 billion to P23 billion for capital expenditures this year as it projects to sustain its growth to record-breaking levels in 2024.
In a disclosure to the Philippine Stock Exchange, the firm said capex will be allotted mainly to fund the planned opening of 700 to 750 company-owned and franchised stores this year.
Based on its target for 2024, JFC projects full year system-wide sales growth to be in the range of 10 percent to 14 percent, with same store sales growth of 5 percent to 7 percent, and store network increase of 7 percent to 8 percent. Operating profit growth will be in the range of 10 percent to 15 percent.
JFC reported a 16 percent improvement in attributable net income to P8.77 billion last year from the P7.56 billion earned in 2022 while net income rose 22.4 percent to P8.99 billion in 2023 from P7.34 billion in the previous year.
“Our full year 2023 results reflect the strength of our execution and resiliency of our brands. We achieved an all-time high revenue of P244.1 billion, a 15.2 percent increase year-over-year which translated to a new record operating profit of P14.4 billion, up by 45.0 percent compared to full year 2022.
“Year on year, we improved gross profit and operating profit margins each by 120 basis points (bps), reinforced by our cost efficiency initiatives and our ability to control non-inventory-related costs,” said JFC Chief Executive Officer Ernesto Tanmantiong.
He added that, “We closed the year with a new system-wide sales (SWS) record, surpassing the P300 billion mark. Overall system-wide sales for 2023 grew by 16.3 percent to P345.3 billion, driven by a 10.6 percent growth in same store sales (SSS) and 5.4 percent from new stores.”
JFC’s Philippine business, which accounts for 61.0 percent of consolidated SWS, delivered a 17.6 percent growth in SWS while the international business grew by 14.4 percent.
Notably, the Jollibee brand, which has over 1,600 stores globally and accounts for 49.0 percent of JFC’s system-wide sales grew by 18.5 percent in 2023.
JFC opened 658 stores during the year and grew its store network by 6.3 percent to 6,885 stores at year-end, both above its guidance for 2023 of 550-600 new stores and 5.0% increase in store network.
“I am pleased with our results for 2023 which showcased our continued ability to deliver sustainable sales and profit growth,” said Tanmantiong.
He noted that, “Looking ahead to 2024 and beyond, we will continue to focus on our priorities. We will scale the business with our four big focus areas: expand our Jollibee brand internationally; grow our coffee and tea business; exponentially grow in China in multiple lower tier cities; and sustain our strong growth and market leadership in the Philippines.”
“We will ramp up franchising to support our global expansion. We will also accelerate our digital transformation and bring capabilities on-par with global Quick Service Restaurant leaders to increase operational efficiency and further improve customer experience and revenue management,” Tanmantiong added.
He stressed that, “Our strategies combined with a portfolio of strong and valuable brands and the support of our talented global team give me the confidence that we will be able to achieve our goal to triple our value (in terms of net income attributable to equity holders of the Parent Company) in five years.”
JFC Chief Finance Officer Richard Shin said “2023 was another remarkable year, our strong execution drove sales and operating profit growth at the higher end of our guidance. We generated significant cash flow putting us in an excellent position to execute our growth strategy for 2024.”
“While we continue to open new stores this year, we remain focused on managing elements within our control, including driving top line through omni channels, effective cost management and operational efficiency. This gives us the confidence that we will continue to deliver revenue and profit growth, as well as margin and operating cash flow expansion in 2024,” he added.