Jollibee income dips in 2019 amid new brand acquisitions

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Metro Manila (CNN Philippines, February 18) — Jollibee Foods Corporation (JFC) saw its net income drop in 2019, just as it assumed control of new brands.

The listed fast food giant booked a ₱6.33 billion net income for the year, down 14.4 percent from the ₱7.4 billion it made in 2018.

Gross sales grew by nearly 15 percent to ₱243.79 billion, but a surge in operating costs ate into the company's bottom line, according to a disclosure. Sales were particularly strong in the fourth quarter as it reflected the performance of Coffee Bean & Tea Leaf, which JFC acquired for $330 million (about ₱16.7 billion).

The retailer also tallied better sales from its Yonghe King franchise in China as well as Smashburger stores in the United States. The fourth quarter sales also reflected the opening of the first-ever Panda Express store in the Philippines in December, which JFC said performed "above expectation."

Businessman Tony Tan Caktiong secured the local franchise for the restaurant chain from California, known for its orange chicken dish.

JFC opened 497 new stores last year — 273 in the Philippines and 224 abroad, the company told the local bourse.

JFC Chief Executive Officer Ernesto Tanmantiong said 2019 was "a very tough year" for the conglomerate, but said increased customer visits and strong growth in its delivery business continue to pad earnings.

"We look forward to a much stronger sales and profit performance in 2020 and the years ahead as we consolidate the financial performance of CBTL into our financial results," Tanmantiong said in a statement.

This year, The Jollibee Group said it plans to open 600 stores, with 300 to 350 of these to be set up abroad. The company said this may be the first time for offshore branches to outstrip local expansion plans.

Among the other brands owned by JFC are Greenwich, Mang Inasal, Red Ribbon, Burger King, and Chowking in the local market, as well as global brands like Hard Rock Cafe and Pho 24 for a total of 5,971 stores worldwide.