Jollibee Foods Corporation (JFC), one of Asia’s largest food service companies disclosed today that its system wide sales, a measure of all sales to consumers, both from company-owned and franchised stores increased by 26.6% for the third quarter and 18.4% for the first nine months of 2021 compared to the same periods last year. Revenues grew by 24.1% and 17.1% for the third quarter and for the first nine months of 2021, respectively. 

Same store sales in the Philippine business increased by 32.4% in the third quarter of 2021 compared to the same quarter last year while the international business grew by 12.4%. China grew by 2.9%, North America by 19.6%, Europe/Middle East/other parts of Asia by 8.8%, and The Coffee Bean & Tea Leaf® (CBTL) by 20.0%. SuperFoods declined by 53.1% primarily due to heightened restrictions imposed in Vietnam to prevent the spread of COVID-19. Worldwide same store sales growth was 23.6% versus the third quarter of 2020. 

JFC generated a net income attributable to equity holders of the parent company of Php1.6 billion, a reversal from the Php1.6-billion loss incurred in the same period last year on the back of a significant operating profit improvement of JFC’s Philippine business, resulting from its Business Transformation program. EBITDA (Earnings before interest expense, taxes, depreciation and amortization, an approximation of cash flow from operations) continued to rise, from Php1.4 billion in Q3 last year to Php5.0 billion this year. 

Compared with pre-pandemic levels, total system wide sales and revenues in Q3 2021 were still lower by 10.4% and 13.8%, respectively versus Q3 2019. Operating income and net income attributable to equity holders of the Parent Company were lower by 28.3% and 6.1%, respectively and EBITDA was lower by 24.0%. 

The JFC Group opened 249 new stores in the first nine months: 47 in the Philippines, 67 in China, 29 in North America and 15 in EMEAA. SuperFoods and CBTL opened 48 and 43 stores, respectively. A total of 221 stores were permanently closed during the quarter: 63 in the Philippines and 158 abroad. 

On September 23, 2021, Jollibee opened its first store in Madrid, Spain at Puerta del Sol, Calle Arenal no4. Jollibee Madrid is the brand’s largest restaurant in Europe, with a capacity for 200 diners. 

JFC is one of Asia’s largest food service companies with 17 brands operating in 34 countries. Its total store network reached 5,853 outlets as of September 30, 2021, of which 3,202 were in the Philippines and 2,651 were abroad. Its largest brands in terms of number of restaurant outlets are Jollibee with 1,501, The Coffee Bean & Tea Leaf® with 1,047, Chowking with 608, Mang Inasal with 584, Red Ribbon 538, Highlands Coffee with 474, Yonghe King 373, Greenwich 270 and Smashburger 241. 

Following were the key recent developments in JFC: 

On October 14, 2021, JFC issued to the public and listed on the Philippine Stock Exchange its first ever preferred shares. These are in the form of 12,000,000 Series A and Series B cumulative, non- voting, non-participating, non-convertible, redeemable, peso-denominated perpetual preferred shares under JFC’s 20,000,000 Preferred Shares Shelf Registration with the Philippine Securities and Exchange Commission. JFC’s preferred shares commanded the lowest dividend rates among all corporations in the Philippines in at least the past decade. 

On October 29, 2021, Yoshinoya Jollibee Foods, Inc., the joint venture established to operate and expand the Yoshinoya brand in the Philippines signed the franchise agreement with Yoshinoya International Philippines (YIPI) with effective date on November 1, 2021. YIPI is the Philippine subsidiary of Asia Yoshinoya International SDN BHD and Yoshinoya Holdings Co. Ltd., the trademark owner of the Yoshinoya system. 

On November 1, 2021, JFC announced that the fund size of Titan will increase from its current S$200.0 million to S$250.0 million to fund working capital requirements of Tim Ho Wan as well as facilitate the completion of other projects. Titan will also have additional investors, who will be taking up a 10% participating interest in the fund. With the increase in fund size and entry of additional investors, the total commitment of Jollibee Worldwide, Pte. Ltd. (JWPL) to the fund shall increase from S$134.0 million to S$225.0 million which will comprise 90% of the increased fund size and total commitments. Titan is a private equity fund which ultimately owns the Tim Ho Wan brand and company-owned Tim Ho Wan stores. 

On November 3, 2021, JFC disclosed that its wholly owned subsidiary, JWPL will purchase a majority stake in Milkshop International Co. Ltd. (Milkshop), the firm that owns Milksha, a popular Taiwanese bubble tea brand. JFC will purchase shares equivalent to 51% ownership in Milkshop for approximately USD12.8 million. One of the co-founders of Milkshop will continue to retain the 49% ownership of Milkshop. The completion of this transaction is subject to certain closing conditions, and the final closing price will be confirmed after closing. 

On November 5, 2021, JFC announced the final result from JWPL’s offer to purchase for cash (“Tender Offer”) a portion of its USD600.0 million Guaranteed Senior Perpetual Capital Securities. On November 3, 2021 (at 4:00 p.m. London time), a total of USD203.5 million in aggregate principal amount of the Securities were validly tendered and not validly withdrawn, representing 33.9% of the outstanding principal amount. This includes USD400.0 thousand tendered after the Early Tender Time. Immediately following the Settlement Date, USD396.5 million in principal amount of Securities remain outstanding. 

The Tender Offer, which was partially funded by JFC’s recent issuance of 12,000,000 preferred shares, provided a source of liquidity at a time of increased volatility in the broader credit markets, demonstrating JFC’s willingness to provide support to its noteholders. At the same time, the success of the buyback allowed JFC to pursue its proactive management strategy to prudently strengthen its balance sheet. 

On November 8, 2021, JFC declared a cash dividend of Php0.89 per share, 30.9% higher than the cash dividend declared in the same period of 2020. This brought the total cash dividend declared in 2021 to Php1.67 per share, 28.5% higher than in 2020.