Jollibee Foods to spend P12.2B for opening of 450 stores in 2021

Homegrown fast-food operator Jollibee Foods Corp. (JFC) has allocated P12.2 billion for its capital spending this year, mainly to finance the opening of about 450 stores as the company seeks to expand its footprint as business continues to recover amid the COVID-19 pandemic.

The latest capital spending program compares with the P5.9 billion in capital investments recorded in 2020 when 338 new stores were opened, including 81 in the Philippines and 257 overseas. It also compares with the P10 billion actual spending reported in 2019.

"We look forward to sustained recovery of the business as the world gradually returns to normalcy, aided by the introduction of new vaccines. We plan to open 400 plus new stores worldwide most of which will be outside of the Philippines, particularly in North America, Vietnam, and China," JFC chief executive officer Ernesto Tanmantiong said in a regulatory filing.

The company ended 2020 with 96% of its worldwide outlets operating -- 100% of stores in China open, 94% in North America, 95% for SuperFoods, and 90% for the Coffee Bean and Tea Leaf.

JFC started to report a net income in the last quarter of 2020 at P2.049 billion, reflecting a 34.5% drop from P3.128 billion the same quarter in 2019 but an improvement from the net losses in the past three quarters, bringing the year-to-date earnings down 257.4% to a net loss of P11.495 billion.

"All of our regions generated recurring profit in the fourth quarter, led by the Philippines. We have significantly improved the Smashburger and The Coffee Bean & Tea Leaf businesses that they are now in reasonable position to start generating profit in 2021," said Tanmantiong.

"Our strong profit recovery shows our organization's capability to execute  complex and massive undertaking in a very short time like the Business Transformation. It was a very difficult and painful program but the right thing to do for the long term good of the business and the organization," he added.

Launched in May 2020, the company's Business Transformation (BT) program covered the rationalization of worldwide operations. Four commissaries and a total of 486 stores, of which 262 covered by the BT program, were permanently closed.

As of December 31, 2020, JFC reported a total of 5,824 restaurants in its network under the brands Jollibee, Chowking, Greenwich, Red Ribbon, Mang Inasal, Burger King, PHO24, Panda Express in the Philippines; and Yonghe King, Hong Zhuang Yuan, Dunkin' Donuts, Tim Ho Wan, Jollibee, Red Ribbon, Chowking, Highlands Coffee, PHO24, Hard Rock Cafe, Smashburger, and CBTL overseas.

Shares in the company opened Monday at P180.3 apiece, up by P1.60 or 0.90% from its previous close of P178.70 last Friday. —KBK, GMA News