Business

COVID lockdown spells disaster for Jollibee, swings to P1.5B loss in Q1

Homegrown fastfood giant Jollibee Foods Corp. suffered a P1.5 billion loss in the first quarter as the lockdowns imposed in the Philippines and other countrie,s which resulted in the temporary closure of stores, dealt a deeper blow to its sales .

Systemwide retail sales, a measure of all sales to consumers both from company owned and franchised stores, went up by only 1.6% to P55.15 billion. Excluding the impact of the consolidation of the Coffee Bean & Tea Leaf, systemwide sales fell 10%.

About 69% of JFC stores in the Philippines were temporarily closed, China (6%), North America 16% , Europe, Middle East and other parts of Asia (23%).

Revenues dipped 2.3% to P39.4 billion due to the impact of the coronavirus pandemic.

From an operating income of P2.1 billion, JFC incurred an operating loss of P1.3 billion as it had to temporarily shut down a significant number of its restaurants in compliance with the government’s stay-home order.

Ysmael V. Baysa, CFO of JFC, is bracing for even higher losses for the second quarter when the full impact of the lockdowns will be felt.

“We expect the business to start recovering in the third and fourth quarters but we assume that the recovery will be slow,” Baysaid.

Baysa, nevertheless, believes that its strong balance sheet and new business strategy or structure will enable it to weather the current crisis and emerge as a stronger organization in 2021.

The company has earmarked P7 billion for its business continuity plan for the second quarter to respond to consumers’ changing behavior.

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