Shakey’s Pizza Asia Ventures, Inc. (PSE:PIZZA), one the largest casual dining chain of restaurants and food service groups in the Philippines, released a strong set of earnings for the first quarter of 2023 on the back of the continued return of dine in foot traffic and amidst the challenges of an inflationary environment.

Systemwide sales (SWS) hit Php 4.2 billion for the three-month period, increasing by 88% compared to SWS in the first quarter of 2022 and exceeding pre-pandemic levels by 79%. Notwithstanding the impact of its latest acquisition, Potato Corner, the group’s SWS grew by 39%, fueled by robust same store sales growth at 29%. Recall that in the first quarter of 2022, the Philippines saw a resurgence in COVID-19 due the spread of the Omicron variant, impacting foot traffic.

Likewise, revenues for the first three months of the year posted a strong double-digit growth of 94%, reaching Php 3.1 Billion.

The group also increased its number of outlets by 85 during the quarter, resulting in a total of 1,857 outlets by end March. Peri-Peri opened a mix of mall and independent stores, as well as continued the conversion of smaller format Peri Jrs. Into larger store formats. PeriPeri ended the quarter with a total of 72 stores. Potato Corner likewise increased its store footprint, concluding the period with a network of 1,506 outlets.

In terms of profitability, PIZZA’s robust results continued to be driven by the significant impact of sales leverage, a favorable mix, and cost discipline especially with respect to discretionary spend. All these helped mitigate the expected full impact of raw material input cost increases seen since 2022. As a result, gross profit grew by 62% while operating expenses only grew by 46%.

Net income for the first quarter of 2023 clocked in at Php 201 million, 2.6 times of PIZZA’s earnings in the first quarter of 2022. Net margin decently expanded by 170 basis points to 6.4%.

PIZZA will be releasing its Quarterly Report for the First Quarter of 2023 on May 15, 2023.