| The Philippines

Coffee shops contribute to Jollibee’s strong second quarter earnings

Filipino owner of The Coffee Bean & Tea Leaf and Highlands Coffee brands indicates global sales recovery is underway and highlights the growing contribution of its coffee businesses to group sales

Jollibee highlighted the importance of its coffee shop businesses in aiding the group's sales recovery | Photo credit: The Coffee Bean and Tea Leaf

Filipino fast-casual restaurant group Jollibee Foods Corp (JFC) has reported net revenues of 976m Philippine pesos (P) ($19.4m) during the second quarter of 2021 – a 109.5% increase on the same period during 2020.
The results mark a reversal of fortunes for the international operator, which sustained P10.3m ($20.4m) loss in the same quarter in 2020.
However, despite the strong performance, JFC’s sales have yet to recover to pre-pandemic levels. Net income in the first half of 2021 was 54.9% lower compared to the same period in 2019, while system-wide sales were down 13.5%.
Although Jollibee did not report the performance of individual business units, like-for-like store sales across the group’s brands rose 48% in the Philippines, 48% in China, 27.7% in North America, and 21.2% in Europe, the Middle East, and other parts of Asia.
“The improvement in profitability ratios was driven by the growing contribution of foreign business to total sales, the higher contribution of the coffee business to the business portfolio, the increasing contribution of franchise stores versus company stores, and the cost improvement brought by the Business Transformation implemented in 2020,” JFC said in a statement.
The P6.2bn ($12.3m) Business Transformation programme has seen JFC pivot towards e-commerce, delivery and drive-thru to offset temporary store closures during the pandemic. The initiative also includes the permanent closure of 486 non-profitable stores across the group, the company reported.

At the end of the second quarter, JFC disclosed it operated a total of 5,816 outlets represented by 17 brands across 33 countries globally. These include 1,051 The Coffee Bean and Tea Leaf stores, which the firm acquired as part of a $350m deal in July 2019, and 476 Highlands Coffee stores.
In February 2021, JCF said it planned to open 100 Highlands Coffee stores in 2021, mostly in the brand’s native Vietnamese market, revealing the profitable business was the fastest growing unit in the group.

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