Chain restaurant and food service firm Shakey’s Pizza Asia Ventures, Inc. (SPAVI) reported a 15 percent drop in net income year-on-year to P171 million due to driven by higher operating expenses due to investments in the organization and in sales generating activities.
In a disclosure to the Philippine Stock Exchange, the firm said its systemwide sales amounted to P4.8 billion, marking a growth of 15 percent from the high base in the first quarter of 23.
“This performance was supported by the Group’s network expansion program and sustained same-store sales,” Shakey’s said adding that, “as margins improve from locked-in raw material costs, SPAVI expects an upswing in net income during the second half of 2024, with full year profits growing in the mid-teens.”
“Our Group remains optimistic with a healthy dose of caution when it comes to our outlook. Given that we have been operating in a strained consumer environment and are coming from a high base due to the reopening, we are grateful to be able to deliver double-digit topline growth, which we expect to be sustained for the balance of the year,” said SPAVI President and CEO Vicente Gregorio.
He added, “Our guests were more careful about when and how they choose to spend their money. They sought even more value. Therefore, it was crucial for us to ensure that our brands remained relevant through compelling offers and programs to sustain sales.”
During the first quarter, SPAVI benefited from gross margins improving by 160 basis points to 23.3 percent on the back of easing commodities since the end of 2023. Gross profits registered at P719 million, posting a 15 percent increase from the same period last year.
Anticipating gross margin gains and recognizing the need to deliver value to guests in a soft consumer market, the Group invested in topline growth and brand building activities to better capture demand.
SPAVI concluded the quarter with 2,232 stores and outlets in its global network. During the period, the Group ramped up expansion, adding 91 units to its network.
According to Gregorio, the Group’s network expansion program is progressing at a healthy pace. “We continue to capitalize on our brands’ attractive returns, which will support our Group’s growth performance moving forward.”