Jubilant FoodWorks Q2 Results: Profit Rises 74%, Beats Estimates
The company's net profit rose 74% sequentially to Rs 119.8 crore in the quarter ended September.
Jubilant Foodworks Ltd.'s quarterly profit rose, beating estimates, signalling a rise in out-of-home consumption in Asia's third-largest economy.
Net profit of the operator of Domino's Pizza and Dunkin' Donuts in India rose 74% sequentially to Rs 119.8 crore, it said in an exchange filing. Analysts polled by Bloomberg projected the metric at Rs 109.5 crore.
Consolidated revenue from operations rose 25% quarter-on-quarter to Rs 1,116.19 crore. Analysts were expecting Rs 1,058.9 crore.
The company said growth continues to be led by delivery and takeaway channels even as dine-ins recovered.
“As compared to the pre-Covid period of Q2 FY20, Domino’s system sales grew by 11.6%," the company said in its investor presentation. "This was driven by continued strong momentum in delivery and takeaway channels as they grew by 36.8% and 72.2% vs Q2 FY20 respectively.”
Highlights (QoQ)
Operating profit rose 35% to Rs. 287.59 crore sequentially compared with the estimate of Rs 273.5 crore
Ebitda margin came in at 25.8% vs 23.8%.
Gross margin improved 102 basis points to 78%.
Raw material costs rose 20.8% to Rs 230.6 crore.
Employee expenses increased sequentially but fell as a percentage of revenue to 17%. This compares with the pre-Covid average of 19-20% and 19% in the first quarter.
Same-store growth, which refers to the year-over-year growth in sales for restaurants opened before previous financial year, stood at 26.3% against 114.2% in the quarter ended June but contracted 20% year-on-year as restaurants weren’t allowed to operate in maximum capacity amid rising Covid-19 infections. That compares with the Bloomberg estimate of 30%.
Registered 7.2 million app downloads during the quarter.
In Sri Lanka and Bangladesh, the company registered a system sales growth of 88.4% and 33.2% year-on-year, respectively. In Sri Lanka, the company achieved record sales in the quarter.
Total number of Domino’s Pizza outlets stand at 1,435 across 307 cities, while the number of Dunkin stores was 28.
The company increased its stake in DP Eurasia and JGHL, Bangladesh. Post-acquisition, Jubilant Foodworks shall own 90% of JGHL.
“Notwithstanding the operating challenges and inflationary headwinds, we delivered robust topline growth, strong Ebitda margin and record new store openings," the company's Chief Executive Officer Pratik Pota was quoted as saying in a statement. "We're excited about the future and believe that we have the right strategy to lead growth in the exciting period that lies ahead.”
The company opened 60 new stores in the second quarter—its highest ever for a three-month period. That included 55 Domino’s stores, two outlets each for Dunkin’ and Hong’s Kitchen and one of Ekdum!
The company said it undertook a one-time loss of Rs 1.25 crore to support its employees affected by the Covid-19 pandemic during the quarter. That metric stood at Rs 5.6 crore in the preceding quarter. Besides, the company received a Rs 10-crore rent concession during the quarter. In the first half of the ongoing fiscal, the company has implemented capex amounting to Rs 170 crore, pointing to aggressive store expansion.
Shares of Jubilant Foodworks fell 8.51% on Tuesday compared with the S&P BSE Sensex's 0.74% dip.